Issuer Free Writing Prospectus
Filed pursuant to Rule 433(d)
Registration No. 333-194685-01
September 10, 2015
Series 2015-2 EETC Investor Presentation
September 10, 2015
Cautionary Statement Regarding Forward-Looking
Statements and Information
TM
This document includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements may be identified by words such as “may,” “will,” “expect,” “intend,” “anticipate,” “believe,” “estimate,” “plan,” “project,” “could,” “should,” “would,” “continue,” “seek,” “target,” “guidance,” “outlook,” “if current trends continue,” “optimistic,” “forecast” and other similar words. Such statements include, but are not limited to, statements about future financial and operating results, the Company’s plans, objectives, estimates, expectations and intentions, and other statements that are not historical facts. These forward-looking statements are based on the Company’s current objectives, beliefs and expectations, and they are subject to significant risks and uncertainties that may cause actual results and financial position and timing of certain events to differ materially from the information in the forward-looking statements. These risks and uncertainties include, but are not limited to the following: significant operating losses in the future; downturns in economic conditions that adversely affect the Company’s business; the impact of continued periods of high volatility in fuel costs, increased fuel prices and significant disruptions in the supply of aircraft fuel; competitive practices in the industry, including the impact of low cost carriers, airline alliances and industry consolidation; the challenges and costs of integrating operations and realizing anticipated synergies and other benefits of the merger transaction with US Airways Group, Inc.; the Company’s substantial indebtedness and other obligations and the effect they could have on the Company’s business and liquidity; an inability to obtain sufficient financing or other capital to operate successfully and in accordance with the Company’s current business plan; increased costs of financing, a reduction in the availability of financing and fluctuations in interest rates; the effect the Company’s high level of fixed obligations may have on its ability to fund general corporate requirements, obtain additional financing and respond to competitive developments and adverse economic and industry conditions; the Company’s significant pension and other post-employment benefit funding obligations; the impact of any failure to comply with the covenants contained in financing arrangements; provisions in credit card processing and other commercial agreements that may materially reduce the Company’s liquidity; the impact of union disputes, employee strikes and other labor-related disruptions; any inability to maintain labor costs at competitive levels; interruptions or disruptions in service at one or more of the Company’s hub airports; costs of ongoing data security compliance requirements and the impact of any significant data security breach; any inability to obtain and maintain adequate facilities, infrastructure and slots to operate the Company’s flight schedule and expand or change its route network; the Company’s reliance on third-party regional operators or third-party service providers that have the ability to affect the Company’s revenue and the public’s perception about its services; any inability to effectively manage the costs, rights and functionality of third-party distribution channels on which the Company relies; extensive government regulation, which may result in increases in the Company’s costs, disruptions to the Company’s operations, limits on the Company’s operating flexibility, reductions in the demand for air travel, and competitive disadvantages; the impact of the heavy taxation on the airline industry; changes to the Company’s business model that may not successfully increase revenues and may cause operational difficulties or decreased demand; the loss of key personnel or inability to attract and retain additional qualified personnel; the impact of conflicts overseas, terrorist attacks and ongoing security concerns; the global scope of the Company’s business and any associated economic and political instability or adverse effects of events, circumstances or government actions beyond its control, including the impact of foreign currency exchange rate fluctuations and limitations on the repatriation of cash held in foreign countries; the impact of environmental regulation; the Company’s reliance on technology and automated systems and the impact of any failure of these technologies or systems; challenges in integrating the Company’s computer, communications and other technology systems; losses and adverse publicity stemming from any accident involving any of the Company’s aircraft or the aircraft of its regional or codeshare operators; delays in scheduled aircraft deliveries, or other loss of anticipated fleet capacity, and failure of new aircraft to perform as expected; the Company’s dependence on a limited number of suppliers for aircraft, aircraft engines and parts; the impact of changing economic and other conditions beyond the Company’s control, including global events that affect travel behavior such as an outbreak of a contagious disease, and volatility and fluctuations in the Company’s results of operations due to seasonality; the effect of a higher than normal number of pilot retirements and a potential shortage of pilots; the impact of possible future increases in insurance costs or reductions in available insurance coverage; the effect of a lawsuit that was filed in connection with the merger transaction with US Airways Group, Inc. and remains pending; an inability to use net operating losses carried forward from prior taxable years (NOL Carryforwards); any impairment in the amount of goodwill the Company recorded as a result of the application of the acquisition method of accounting and an inability to realize the full value of the Company’s and American Airlines’ respective intangible or long-lived assets and any material impairment charges that would be recorded as a result; price volatility of the Company’s common stock; the effects of the Company’s capital deployment program and the limitation, suspension or discontinuation of the Company’s share repurchase program or dividend payments thereunder; delay or prevention of stockholders’ ability to change the composition of the Company’s board of directors and the effect this may have on takeover attempts that some of the Company’s stockholders might consider beneficial; the effect of provisions of the Company’s Restated Certificate of Incorporation and Amended and Restated Bylaws that limit ownership and voting of its equity interests, including its common stock; the effect of limitations in the Company’s Restated Certificate of Incorporation on acquisitions and dispositions of its common stock designed to protect its NOL Carryforwards and certain other tax attributes, which may limit the liquidity of its common stock; and other economic, business, competitive, and/or regulatory factors affecting the Company’s business, including those set forth in the Company’s Quarterly Report on Form 10-Q for the period ended June 30, 2015 (especially in Part II, Item 1A, Risk Factors and Part I, Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations sections) and other risks and uncertainties listed from time to time in the Company’s other filings with the SEC. There may be other factors of which the Company is not currently aware that may affect matters discussed in the forward-looking statements and may also cause actual results to differ materially from those discussed. Any forward-looking statements speak only as of the date hereof or as of the dates indicated in the statements. The Company does not assume any obligation to publicly update or supplement any forward-looking statement to reflect actual results, changes in assumptions or changes in other factors affecting these forward-looking statements other than as required by law.
2
TM
This Investor Presentation highlights basic information about the issuer and this offering. Because it is a summary, it does not contain all of the information that you should consider before investing.
The issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the issuer has filed with the SEC for more complete information about the issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by calling Morgan Stanley at 1-866-718-1649
3
American Airlines TM
Group
American Airlines, Inc.
2015-2 EETC Offering
American 2015-2 EETC
TM
American Airlines, Inc. (“American”) intends to issue $888,740,000 in aggregate face amount of Pass Through Certificates, Series 2015-2 (“American 2015-2”), in three classes, as follows:
– Class AA: $488,182,000
– Class A: $200,279,000
– Class B: $200,279,000
The proceeds from the offering will be used by American to finance 19 aircraft currently owned by American:
– Three Airbus A319-100 aircraft delivered from April 2015 to June 2015
– Nine Airbus A321-200 aircraft delivered from April 2015 to August 2015
– Three Boeing 737-800 aircraft delivered from March 2015 to June 2015
– One Boeing 777-300ER aircraft delivered in February 2015
– Three Boeing 787-8 aircraft delivered from February 2015 to July 2015 – selected from a pool of five such aircraft(1)
The collateral for this transaction represents a broad cross-section of American’s newest, most efficient, and strategically core aircraft to the current and future fleet
Sole Structuring Agent and Lead Bookrunner: Morgan Stanley
Active Bookrunners: Citi, Credit Suisse, Deutsche Bank, and Goldman Sachs
Liquidity Facility Providers:
– For Class AA Certificates: Commonwealth Bank of Australia, New York Branch, rated Aa2/AA-
– For Class A and Class B Certificates: Crédit Agricole Corporate and Investment Bank, rated A2/A, acting through its New York branch
1 American expects to finance the first 3 of 5 delivered Boeing 787-8 aircraft to be part of the collateral pool for this transaction
5
American 2015-2 EETC Structural Summary
TM
Class AA Class A Class B
Face Amount $488,182,000 $200,279,000 $200,279,000
Expected Ratings Aa3 / AA A2 / A Baa3 / BBB
(Moody’s / S&P)
Initial LTV / Maximum LTV(1) 39.0% / 39.6% 55.0% / 55.8% 71.0% / 72.1%
Initial Average Life 9.0 years 9.0 years 5.6 years
Regular Distribution Dates March 22 & September 22 March 22 & September 22 March 22 & September 22
Final Expected Distribution Date(2) September 22, 2027 September 22, 2027 September 22, 2023
Final Legal Distribution Date March 22, 2029 March 22, 2029 March 22, 2025
Section 1110 Protection Yes Yes Yes
Liquidity Facility 18 months 18 months 18 months
1 Initial Loan to Value ratio calculated as of Issuance Date. Maximum Loan to Value ratio calculated as of first regular distribution date, March 22, 2016
2 Each series of Equipment Notes will mature on the Final Expected Distribution Date for the related class of Certificates
6
Key Structural Elements
American 2015-2 is structured similar to recent precedents
Three Classes of Certificates Offered
Three tranches of amortizing debt are being offered, with the Class AA, Class A, and Class B each benefiting from a separate liquidity facility covering three semiannual interest payments Cross-Default and Cross-Collateralization
The Equipment Notes will be cross-collateralized by all Aircraft
All Indentures will include cross-default provisions Waterfall
Interest on Eligible Pool Balance of the Class A and Class B tranches is paid ahead of principal on the Class AA tranche and interest on Eligible Pool Balance of the Class B tranche is paid ahead of principal on the Class A tranche Buy-Out Rights
Subordinated Certificateholders have the right to purchase all (but not less than all) of then outstanding
Certificates ranking senior to such subordinated Certificates at par plus accrued and unpaid interest upon certain events during an American bankruptcy Collateral
Strategically core aircraft types to American’s fleet operations; represents a cross-section of American’s go-forward fleet
Weighted average aircraft age of ~0.3 years(1) Liquidity Facility
The Liquidity Facility for each of the Class AA Certificates, Class A Certificates, and Class B Certificates is expected to be sufficient to cover up to three consecutive semiannual interest payments with respect to such Class
1 At September 24, 2015
7
American Airlines TM
Group
Overview of the Collateral Pool
Attractive Aircraft Pool
Aggregate aircraft appraised value of approximately $1,252 million(1)
Appraisals indicate collateral cushion as of the first regular distribution date of 60.4%, 44.2%, and 27.9% on the Class AA, A, and B Certificates, respectively,(2) which is expected to increase over time as the debt amortizes
Maintenance Adjusted
Aircraft Aircraft Narrow / Wide Manufacturer’s Registration Engine MTOW Aircraft Age Base Value ($MM)
Month of Delivery
No Type Serial Number Number Type (lbs) (years)
AISI BK MBA LMM(1)
1 A319-100 Narrow 6552 N8030F CFM56-5B7 166,400 Apr-15 0.4 46.51 35.77 37.18 37.18
2 A319-100 Narrow 6595 N8031M CFM56-5B7 166,400 May-15 0.4 46.69 35.86 37.29 37.29
3 A319-100 Narrow 6644 N4032T CFM56-5B7 166,400 Jun-15 0.3 46.54 36.07 37.41 37.41
4 A321-200 Narrow 6520 N135NN V2533-A5 206,100 Apr-15 0.5 53.48 51.98 53.76 53.07
5 A321-200 Narrow 6532 N136AN V2533-A5 206,100 Apr-15 0.4 53.67 52.12 53.76 53.18
6 A321-200 Narrow 6650 N138AN V2533-A5 206,100 Jun-15 0.2 54.15 52.54 54.04 53.58
7 A321-200 Narrow 6687 N139AN V2533-A5 206,100 Jul-15 0.2 54.36 52.68 54.18 53.74
8 A321-200 Narrow 6667 N140AN V2533-A5 206,100 Jul-15 0.2 54.33 52.65 54.18 53.72
9 A321-200 Narrow 6656 N141NN V2533-A5 206,100 Jul-15 0.2 54.35 52.66 54.18 53.73
10 A321-200 Narrow 6711 N142AN V2533-A5 206,100 Jul-15 0.2 54.44 52.71 54.18 53.78
11 A321-200 Narrow 6745 N143AN V2533-A5 206,100 Aug-15 0.1 56.43 53.35 54.31 54.31
12 A321-200 Narrow 6723 N144AN V2533-A5 206,100 Aug-15 0.1 56.43 53.35 54.31 54.31
13 B737-800 Narrow 31214 N967NN CFM56-7B 158,500 Mar-15 0.5 47.43 46.67 46.65 46.67
14 B737-800 Narrow 33241 N968NN CFM56-7B 158,500 Apr-15 0.4 47.62 47.07 46.80 47.07
15 B737-800 Narrow 31219 N973NN CFM56-7B 158,500 Jun-15 0.3 47.99 47.37 47.09 47.37
16 B777-300ER Wide 33524 N733AR GE90-115 700,000 Feb-15 0.6 152.97 167.70 157.37 157.37
17 B787-8 Wide 40619 N801AC GEnx-1B70 502,500 Feb-15 0.6 118.40 120.43 115.93 118.25
18 B787-8 Wide 40624 N806AA GEnx-1B70 502,500 May-15 0.4 119.85 122.28 116.93 119.69
19 B787-8 Wide 40625 N807AA GEnx-1B70 502,500 Jul-15 0.2 120.26 122.23 117.59 120.03
Assumed
Total 19 Aircraft 0.3 $1,251.75
Note: American expects to finance the first 3 of 5 delivered Boeing 787-8 aircraft to be part of the collateral pool for this transaction. Table above assumes this will occur
1 Lesser of the mean and median (“LMM”) of the maintenance adjusted Base Values of the aircraft as appraised by Aircraft Information Services, Inc. (“AISI”), BK Associates, Inc. (“BK”) and Morten
Beyer & Agnew (“mba”) in September 2015
2 Collateral cushion calculated as of first regular distribution date, March 22, 2016, which coincides with date of maximum LTV
9
Young and Diversified Portfolio
By Aircraft Type (% of base value)(1) By Body Type (% of base value)(1)
A319-100
9%
B787-8
29%
Wide
41%
Narrow
A321-200 59%
B777-300ER 39%
12%
B737-800
11%
By Delivery Date: 0.3 Years Average Age(1)(2)
30%
25%
20% 10%
9%
15% 4%
10%
13% 8% 10% 4% 17%
5% 4% 9%
0% 4% 3% 3% 3%
Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15
A319-100 A321-200 B737-800 B777-300ER B787-8
1 By LMM Base Value. Assumes that American elects to finance the first 3 of 5 delivered Boeing 787-8 aircraft to be part of the collateral pool for this transaction
2 At September 24, 2015
10
Collateral Aircraft Assessment
TM
A319-100
Modern, reliable aircraft with large fleet and good operating economics
Good size for frequency-driven or lower-traffic markets; popular with some low-cost carriers
Sharklets (enhanced wings) give value and lease rate premium
Good “hot and high” performance driving demand in emerging markets, 2nd and 3rd tier operators
Importance to American:
125 currently in American’s fleet
MD80 domestic network replacement for small, medium or high frequency markets
Fitted with the latest in the new American product offering including wi-fi, personal seat entertainment, universal AC power outlets and main cabin extra seating
A321-200
Benefits from airlines up-gauging as it has lower seatmile costs than 150-seaters; provides more capacity at slot-constrained airports
Sharklets increase payload / range, for US transcontinental capability; 230-seat option available
Increasingly used as a 757 replacement
Low storage rate
Importance to American:
• 165 currently in American’s fleet with 54 more on order
737-800
Considered the most liquid narrowbody to date
A total of 150+ operators – proven very popular among a good mix of mainline, charter, and low-cost carriers; good regional distribution, and a favorite with the leasing community
More than 3,600 in service, 1,100 on order
Very active leasing market
Importance to American:
257 currently in American’s fleet with 47 more on order
Core medium density narrowbody aircraft in fleet
Note: Order count inclusive of unfilled orders. Statistics exclude government, executive and private jets as well as undisclosed customers
Source: Ascend, Airbus, American, Boeing as of August 2015
11
Collateral Aircraft Assessment
TM
777-300ER
Best-selling widebody variant to date – almost 800 sold, with nearly 30% still on backlog; two-thirds of these are for existing customers
Popular in all regions, especially Asia-Pacific and Middle East
Has become a core long-haul type worldwide
None in storage, no immediate availability
Importance to American:
17 currently in American’s fleet with 3 more delivering
Current and future medium/heavy density long-range widebody of choice
787-8
Range of three variants pioneering the next generation; all-composite fuselage widebody. New standards in cabin comfort
The 787 program has almost 1,100 orders already received from more than 60 airline customers. Key customers and lessors across all world regions
Importance to American:
The 787 family of aircraft (including -8 and -9 variants) will be American’s new generation of long range aircraft – American has committed orders for 42 787 family aircraft, including 20 787-8s
American expects 15% lower operating costs with the 787 family aircraft
The 787-8 enables American to serve city pairs previously not accessible with 767-300ER aircraft
Note: Order count inclusive of unfilled orders. Statistics exclude government, executive and private jets as well as undisclosed customers
Source: Ascend, American, Boeing as of August 2015
12
Fleet Replacement Plan
TM
Building one of the most modern and fuel-efficient fleets in the industry
2015 2016 2017 2018 Beyond 2018 Total
A320 Family 42 25 20 - - 87
A320 Family Neo - - - - 100 100
A350-900 - - 6 10 6 22
B737-800 18 20 20 - - 58
B737-8 Max - - 3 17 80 100
B777-300ER 2 2 - - - 4
B787 Family 13 8 13 8 - 42
Mainline Total 75 55 62 35 186 413
Average Mainline Age (yrs) 11.0 9.9 9.6 10.2
CRJ-900 25 20 - - - 45
E175 29 24 12 - - 65
Regional Total 54 44 12 - - 110
Note: New aircraft deliveries by type. Regional inductions include aircraft owned by third party operators
Source: American
13
Airbus A319-100
TM
125 aircraft are currently in the American fleet
MD-80 domestic network replacement for small, medium, or high frequency markets
Aircraft of choice for American in “hot and high” performance in emerging markets with less frequency or markets with lower traffic
Top 10 Operators
Operator # of Aircraft %
1 Easyjet 149 11.0%
2 American Airlines 125 9.3%
3 Delta Air Lines 57 4.2%
4 United Airlines 55 4.1%
5 British Airways 44 3.3%
6 Germanwings 43 3.2%
7 China Southern Airlines Company 39 2.9%
8 Air Canada 38 2.8%
9 Air France 38 2.8%
10 China Eastern Airlines 36 2.7%
91 other operators 725 53.7%
Total in Operation 1,349 100.0%
Key Characteristics
Firm Orders 1,422
# Delivered 1,374
# Backlog 48
# In Operation 1,349
# of Customers 118
# of Current Airline Operators 101
A319 Range Map (from DFW)
Note: Aircraft statistics exclude government, executive and private jets as well as undisclosed customers
Source: American, Airbus as of August 2015
14
Airbus A321-200
TM
165 aircraft are currently in the American fleet
Benefits from airlines up-gauging as it has lower seatmile costs than 150-seaters; provides more capacity at slot-constrained airports
Increasingly used as a Boeing 757 replacement
Top 10 Operators
Operator # of Aircraft %
1 American Airlines 165 14.9%
2 China Southern Airlines Company 79 7.1%
3 Lufthansa 64 5.8%
4 Air China 51 4.6%
5 Turkish Airlines 49 4.4%
6 Vietnam Airlines 49 4.4%
7 China Eastern Airlines 42 3.8%
8 Sichuan Airlines 27 2.4%
9 Aeroflot 26 2.3%
10 Asiana Airlines 25 2.3%
76 other operators 533 48.0%
Total in Operation 1,110 100.0%
Key Characteristics
Firm Orders 2,206
# Delivered 1,125
# Backlog 1,081
# In Operation 1,110
# of Customers 128
# of Current Airline Operators 86
A321 Range Map (from DFW)
Note: Aircraft statistics exclude government, executive and private jets as well as undisclosed customers.
Source: American, Airbus as of August 2015
15
Range of Boeing 737-800, 787-8, and 777-300ER
Aircraft
TM
777-300ER(1)
351,530-kg (770,000-lb) MTOW(2)
386 three-class passengers
787-8(1)
227,930-kg (502,500-lb) MTOW
242 three-class passengers
737-800
70,010-kg (158,500-lb) MTOW
162 three-class passengers
Hong Kong
Shanghai
Tokyo
Mumbai
Dubai
Moscow
Addis Ababa
London
Anchorage
Los Angeles
DFW
Mexico City
New York
Lagos
Sydney
Auckland
Panama City
Lima
Buenos Aires
Rio De Janeiro
Cape Town
1 777-300ER and 787-8 have similar range
2 Represents Maximum Takeoff Weight (“MTOW”) for American specific aircraft. Aircraft included in transaction have 700,000-lb MTOW
Source: Boeing
16
Boeing 737-800
TM
Today, the 737-800 is the workhorse of the American fleet, accounting for over 30% of domestic ASMs
– In the combined American network, the 737-800 accounts for more domestic ASMs than the MD-80 and regional fleet combined
Over the last decade, the 737-800 has replaced the MD-80 as the backbone of the American fleet
The 737-800 operates out of every legacy American hub to most major spokes and also accounts for a significant portion of hub-to-hub flying
– In addition, the fleet type is used for missions to Central America, the Caribbean, and the northern rim of South America
737-800 Scheduled Deployment
Change in Fleet Size of the 737-800
284 304 304
246 264
226
195
152 169
2010 2011 2012 2013 2014 2015 2016 2017 2018
Source: American
17
Boeing 777-300ER & Boeing 787-8
TM
17 Boeing 777-300ER aircraft are currently in the American fleet
Best-selling widebody variant to date; current & future medium/heavy density long-range widebody of choice
10 Boeing 787-8 aircraft are currently in the American fleet
The Boeing 787 is delivering up to 20% better fuel burn than the Boeing 767 variant; enables American to serve city pairs previously not accessible with 767-300ER aircraft
777-300ER Top 10 By Order
Operator # of Aircraft %
1 Emirates 120 15.3%
2 Cathay Pacific Airways 49 6.2%
3 GECAS 49 6.2%
4 Air France 36 4.6%
5 Qatar Airways 34 4.3%
6 Turkish Airlines 32 4.1%
7 AerCap 28 3.6%
8 All Nippon Airways 28 3.6%
9 Singapore Airlines 27 3.4%
10 ALC 21 2.7%
34 other operators 362 46.1%
Total in Order 786 100.0%
777-300ER Key Characteristics
Firm Orders 786
# Delivered 581
# Backlog 205
# of Customers 44
787-8 Top 10 By Order
Operator # of Aircraft %
1 All Nippon Airways 36 7.9%
2 Qatar Airways 30 6.6%
3 Air India 27 5.9%
4 Japan Airlines 25 5.5%
5 Aeroflot - Russian Airlines 22 4.8%
6 American Airlines 20 4.4%
7 Delta Air Lines 18 3.9%
8 Gulf Air 16 3.5%
9 Avianca 15 3.3%
10 LATAM Airlines Group 14 3.1%
38 other operators 234 51.2%
Total in Order 457 100.0%
787-8 Key Characteristics
Firm Orders 457
# Delivered 264
# Backlog 193
# of Customers 48
Source: American, Boeing as of August 2015
18
American Airlines TM
Group
American Airlines, Inc.
Business Overview
American Airlines Group Overview(1)
TM
American Airlines Group Inc. (“AAG”) continued its phenomenal progress in the second quarter of 2015
– Net income of $1.9 billion – highest quarterly profit in AAG history
– Record pretax margin of 17.2 percent
Integration continues to go smoothly
– Received single operating certificate from FAA
– In July began cutover to single reservation system
– Began negotiations with our Dispatchers
Investing in our product
– Acquired 24 new mainline aircraft, including four new 787 Dreamliners. Retired 34 aircraft
– Inducted nine new regional aircraft, retired/parked eight aircraft
Source: American
Note: Profit excludes net special charges. Please refer to the company’s GAAP to Non-GAAP reconciliation on SEC Form 8-K issued July 24, 2015
1 The Certificates and the Equipment Notes are obligations of American and will not be obligations of AAG
20
Uses of Cash
TM
Our cash position will allow us to
Integrate the airline
Invest in our operation and our product
Pay down debt that is more expensive than our current cost of debt
Source: American
21
Integration Update – Notable Milestones
US Airways and American Airlines Codeshare
Largest Codeshare in history
Completed within two months of the merger close
US Airways Joins oneworld
oneworld now serves 1,015 destinations in 154 countries
Completed within four months of the merger close
Single Operating Certificate
Awarded on April 8 by the FAA. Exactly to schedule
Starting point for operational integration
Single Frequent Flyer Program
World’s largest airline loyalty system integration completed on April 19th
Zero customer impact
Single passenger service system (PSS)
Process started on July 18th
Will be complete on October 17th
Source: American
22
Investing In Our Operation
TM
Operational mindset
- Focus on on-time departures
- Improve baggage handling performance
- Reduce aircraft out of service
Increased recruitment
- Over 200 new employees in planning, supply chain, and quality control
- Over 300 new employees in line maintenance
- Additional mechanics in base maintenance
- Over 1,000 new reservations employees
Capital expenditures
- Investment in new ground support equipment
- Investment in new bag handling technology
Source: American
23
Investing in Our Product
TM
Announced $2 billion in additional customer experience improvements
Aircraft retrofits
- Fully lie-flat seats on the entire long-haul, international fleet
- International Wi-Fi
- AC power outlets and USB power in all cabins on new and retrofitted aircraft
- Enhanced in-seat entertainment
- Main Cabin Extra seating
Airports
- Improved and updated kiosks
- Admirals Club refurbishment program
Source: American
24
Paying Down Debt TM
We have paid down over $3.5B in high-cost debt since the merger closed in December 2013
Transaction Amt Paid Off ($M) Date expected to be paid off under normal debt payment schedule Avg. Coupon
7.5% Senior Secured Notes $1,000 3/15/2016 7.500%
Aircraft Leases $1,053 Various 6.547%
AAdvantage $433 1/1/2017
Aircraft Debt $199 Various 6.748%
Airport Bonds $898 Various 7.422%
Total $3,584
Source: American
25
American Airlines TM
Group
American Airlines, Inc.
Financial Update
2Q15 Consolidated Passenger RASM TM
Consolidated PRASM was down 6.9% in the second quarter due to high capacity growth, large currency devaluations, and continued weakness in Latin America
2Q15 YOY Change
in Consolidated PRASM
1.4% -4.6% -4.6% -5.3% -5.6% -6.9%
jetBlue AIRWAYS Southwest Alaska Air UNITED TM
Source: American; other airline filings
27
2Q15 Mainline CASM TM
Mainline CASM excluding fuel and special items was up 2.5 percent year-over-year, due primarily to recent labor contracts and other investments to improve operating reliability
2Q15 YOY Change in
Mainline CASM
(excluding fuel and special items)
4.2% 3.3% 2.7% 2.5% -0.1% -3.8%
jetBlue AIRWAYS UNITED TM Southwest Alaska Air
Source: American; other airline filings. Excludes net special items. Please refer to the company’s GAAP to Non-GAAP reconciliation on SEC Form 8-K issued July 24, 2015
28
2Q15 Pretax Margin TM
American’s second quarter pretax margin of 17.2 percent, up 4.4 points. Year-over-year, was the highest of the network airlines
2Q15 Pretax Margin
(ex special items)
25.7% 21.7% 17.2% 15.5% 15.3% 12.7%
Alaska Air Southwest TM jetBlue AIRWAYS UNITED
2Q15 YOY Pretax Margin
(ex special items)
(pts)
8.6 7.4 6.2 4.4 3.8 1.8
jetBlue AIRWAYS Alaska Air Southwest TM UNITED
Source: American; other airline filings. Excludes net special items. Please refer to the company’s GAAP to Non-GAAP reconciliation on SEC Form 8-K issued July 24, 2015
29
Total Relative Liquidity Position TM
American had $11.5B in available liquidity, or 27% of LTM Revenues at the end of the second quarter
2Q15 Relative Liquidity1
27.3% 24.8% 21.8% 21.6% 16.4% 13.7%
TM jetBlue AIRWAYS Alaska Air Southwest UNITED
Source: American; other airline filings
1 Data includes total on balance sheet cash as of June 30, 2015 plus available undrawn revolver capacity at that date
30
American Airlines TM
Group
Appendix
GAAP to non-GAAP Reconciliation TM
American Airlines Group Inc. (1) 3 Months Ended June 30, Percent Change
Reconciliation of Income Before Income Taxes Excluding Special Items 2015 (In millions) 2014
Income before income taxes as reported $1,719 $1,204
Special items:
Special items, net 144 251
Regional operating special items, net 10 2
Nonoperating special items, net (11) 2
Income before income taxes as adjusted for special items $1,862 $1,459 28%
3 Months Ended June 30,
Calculation of Pre-Tax Margin Excluding Special Items 2015 2014
Income before income taxes as adjusted for special items $1,862 $1,459
Total operating revenues $10,827 $11,355
Pre-tax margin excluding special items 17.2% 12.8%
3 Months Ended June 30, Percent Change
Reconciliation of Net Income Excluding Special Items 2015 2014
Net income as reported $1,704 $864
Special items:
Special items, net 144 251
Regional operating special items, net 10 2
Nonoperating special items, net (11) 2
Non-cash income tax provision 7 337
Net income as adjusted for special items $1,854 $1,456 27%
Source: American
1 The Certificates and the Equipment Notes are obligations of American and will not be obligations of AAG
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GAAP to non-GAAP Reconciliation TM
3 Months Ended June 30,
Reconciliation of Operating Cost per ASM Excluding Special Items and Fuel - Mainline only 2015 2014
(in millions)
Total operating expenses $8,906 $9,956
Less regional expenses:
Fuel (349) (535)
Other (1,208) (1,122)
Total mainline operating expenses 7,349 8,299
Special items, net (144) (251)
Mainline operating expenses, excluding special items 7,205 8,048
Aircraft fuel and related taxes (1,774) (2,830)
Mainline operating expenses, excluding special items and fuel $5,431 $5,218
(in cents)
Mainline operating expenses per ASM 11.87 13.61
Special items, net per ASM (0.23) (0.41)
Mainline operating expenses per ASM, excluding special items 11.64 13.19
Aircraft fuel and related taxes per ASM (2.86) (4.64)
Mainline operating expenses per ASM, excluding special items and fuel 8.77 8.55
Note: Amounts may not recalculate due to rounding.
Source: American
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