American Airlines said demand remained strong in the just-ended quarter in terms of both passengers and cargo, but results were hit by higher jet fuel expenses (Daniel SLIM)

New York (AFP) – American Airlines announced Thursday that it would trim travel capacity and defer deliveries of some planes after surging fuel prices hit second-quarter profits.

American reported net income of $566 million, down 34.5 percent from the year-ago level.

Revenues rose 3.7 percent to $11.6 billion.

American said demand remained strong in the just-ended quarter in terms of both passengers and cargo, but results were hit by higher jet fuel expenses. 

The airline expects fuel costs to increase by more than $2 billion in 2018 compared with last year.

“This was perhaps the most challenging quarter for the American team since our merger with US Airways in 2013,” said chief executive Doug Parker.

Parker cited the increase in fuel prices, a computer glitch at its PSA Airlines subsidiary that led to cancellation of thousands of flights, and revenue trends that “while increasing, have begun to trail the rate of increase at our largest competitors for the first time since early 2016.”

To boost profitability, American said it would add fewer flights than previously planned in the second half of 2018 and defer some aircraft deliveries. 

American has ordered 22 Airbus A321neos over three years starting in 2019. But the carrier plans to spread the deliveries out beyond that timeframe, saving $1.2 billion.

Shares were flat at $38.20 in pre-market trading.

Disclaimer: This story has not been edited by Siliconeer and is published from a syndicated feed. Siliconeer does not assume any liability for the above story. Validity of the above story is for 7 Days from original date of publishing. Content copyright AFP.