By DAVID KOENIG
FORT WORTH, Texas (AP) — American Airlines reported a record profit for the fourth quarter and all of 2015 as a sharp drop in fuel prices more than offset lower revenue.
The world's biggest airline said Friday that its full-year earnings were the highest for any carrier when one-time items were excluded. American is poised for another big year: airline officials said they expect to save another $2 billion on fuel in 2016.
American executives said the outbreak of the Zika virus and a government warning to pregnant women about traveling to Latin America and the Caribbean seemed to be having no effect on their business.
Like other airlines, American says it will give refunds or rebook pregnant women who were planning trips to areas affected by the virus, which has been linked to birth defects in Brazil. American officials said they didn't know how many customers have asked for refunds, but airline president Scott Kirby said "it has not been a meaningful number."
Kirby said he doesn't expect Zika to be as damaging to the airline industry as past outbreaks such as the respiratory disease SARS in 2003, because the mosquito-borne virus is not transmitted through the air on planes. CEO Doug Parker added that he is not concerned about the effect on airlines because Zika "only has an impact on pregnant women, not the entire traveling public."
The comments from Kirby and Parker echoed those of a JetBlue executive, who said Thursday that his airline did not see a measurable effect on trip bookings or refunds.
The quarter also provided further evidence that airfares are falling, welcome news for passengers. American did not disclose its average fare. However, in the fourth quarter, passengers flew 3.8 percent more miles than a year earlier but paid 8.9 percent less per mile, a sign of lower prices. Investors prefer to look at how much passengers pay for every seat flown one mile — that accounts for unsold seats — and that figure also fell, by 6 percent.
American Airlines Group Inc. posted net income of $3.28 billion in the fourth quarter. The results were inflated by an accounting gain from a tax item, a $3 billion credit because American reversed a tax valuation now that it is making money after losses in earlier years. Delta and United have made the same accounting change.
Without that and other one-time items, American said it earned $1.3 billion or $2 per share, compared with $1.1 billion, or $1.52 per share, a year earlier. That was still a record and beat Wall Street expectations. Analysts surveyed by FactSet predicted $1.97 per share.
Revenue fell 5.2 percent to $9.63 billion, matching the FactSet forecast.
American more than offset the $530 million decline in revenue with savings of nearly $1.1 billion — 41 percent — on jet fuel. The steep drop in oil prices since mid-2014 has been a boon to airlines. They have passed some of the savings on to consumers in lower fares but kept much of it.
For all of 2015, American earned $7.6 billion. Excluding one-time items, adjusted profit was $6.3 billion, which Parker, the CEO, said was more than any airline had ever earned.
American topped Delta Air Lines Inc.'s highest adjusted profit, reported last week, of $5.9 billion for 2015. Delta had also posted a higher overall net income of $10.5 billion in 2013, but excluding a big tax gain gave it an adjusted profit of $2.7 billion.
Shares of Fort Worth-based American rose 85 cents, or 2.2 percent, to close at $38.99. The shares ended the day down 8 percent since the beginning of the year and 25 percent in the last 12 months.
David Koenig can be reached at http://twitter.com/airlinewriter
(Copyright 2016 by The Associated Press. All Rights Reserved.)