American Airlines Group, Inc. · NASDAQ:AAL
American Airlines — Investor Day (March 2024)
118 slides from American Airlines's investor day presentation, Mar 4, 2024
Slide 1: Investor Day, March 4, 2024
Exhibit 99.1 InvestorDay = AMICON American Airlines “¢ MARCH 4, 2024
Slide 2: Safe Harbor Statement
2 Safe Harbor Statement Certain of the statements contained in this presentation should be considered forward-looking statements within the meaning of the Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. Th
Slide 3: Creating shareholder value
3 Creating shareholder value ROBERT ISOM CHIEF EXECUTIVE OFFICER
Slide 4: The time is now
4 The time is now Constructive environment • Demand has returned • Favorable backdrop for American American is a changed airline • Delivering on commitments • Driving value through execution and performance Opportunities ahead • Value-creating drivers • Margin expansion and free cash flow growth
Slide 5: Demand for air travel has returned
5 Demand for air travel has returned.
Slide 6: Demand for travel has accelerated
6 2014 2019 2023 Demand for travel has accelerated Note: U.S carriers industry revenue. Compound annual growth rate (CAGR). Source: Airline financials. Total airline industry revenue $B $161 $187 $227 3% CAGR 5% CAGR
Slide 7: Consumer spending continues to shift to experiences
7 Consumer spending continues to shift to experiences Growth in spending on goods and experiences1 % 1. Nominal spending YoY growth. Source: Bureau of Economic Analysis, Mastercard Economics Institute. 3.2% 6.1%5.3% 15.2% Avg. 2014–2019 Avg. 2022–2023 Goods Experiences
Slide 8: Revenue opportunity remains
8 0.88% 0.78% 0.83% Historical average2 0.88% Every basis point of recovery is worth ~$2.5 billion in industry revenue. 1. U.S. carriers industry revenue. 2. Historical average 2010-2019. Source: Philadelphia Federal Reserve and FRED database (GDP), Airline financials (Industry revenue). Revenue opp
Slide 9: Industry constraints persist
9 Industry constraints persist Engine issues OEM delivery delays Supply chain constraints Air Traffic Control challenges
Slide 10: We are a changed airline
10 We are a changed airline.
Slide 11: People, plan, process
11 People, plan, process Rebuilt senior leadership team Industry experience External expertise
Slide 12: Delivered a reliable operation
12 Delivered a reliable operation Completion factor % 97.4% 97.6% 98.9% 2018 2019 2023 Source: Internal data.
Slide 13: Returned American to profitability
13 Returned American to profitability Adj. pre-tax income (loss)1 $B $2.9 ($12.2) ($6.9) $0.5 $2.5 2019 2020 2021 2022 2023 1. Adjusted pre-tax income (loss) excludes the impact of pre-tax net special items and is a non-GAAP measure. See GAAP to non-GAAP reconciliation in Appendix. Source: Airline f
Slide 14: Strengthened our balance sheet
14 $54 $46 $43 2Q 2021 YE 2022 YE 2023 Strengthened our balance sheet Total debt1,2 $B 1. As of respective period end. 2. Total debt includes debt, finance and operating lease liabilities and pension obligations. Source: Airline financials. $11.4B Peak
Slide 15: Awards and accolades
15 Awards and accolades Achieved rating upgrades from all three major credit rating agencies Won Best U.S. Airline Loyalty Program at the 2023 TPG Awards Best Elite Program for the 11th consecutive year at the 2023 Freddie Awards Named to the Dow Jones Sustainability North America Index for the thir
Slide 16: Opportunities ahead drive value
16 Opportunities ahead drive value.
Slide 17: Compelling value-creating drivers
17 Compelling value-creating drivers Reengineering the business Asset utilization, productivity, procurement Operational excellence Strong, reliable operation Rewards Leading travel rewards program & co-branded credit card opportunity Network Strongest domestic & short-haul international network Fle
Slide 18: Key target metrics
18 2024E 2025E 2026E+ Adj. EBITDAR margin1 ~ 14% ~ 14%–16% ~ 15%–18% Free cash flow2 ~ $2B > $2B > $3B Key target metrics Note: The Company is unable to fully reconcile certain forward-looking guidance to the corresponding GAAP measure because the full nature and amount of net special items cannot b
Slide 19: Agenda
19 Agenda Commercial execution Vasu Raja, Chief Commercial Officer Operational excellence David Seymour, Chief Operating Officer Reengineering with technology Ganesh Jayaram, Chief Digital & Information Officer Leading performance and accountability Cole Brown, Chief People Officer Maximizing value
Slide 20: American is well-positioned to create value
20 Commercial opportunities Fleet Network Rewards Focused execution Operational excellence Reengineering the business Margin expansion Long-term free cash flow generation American is well-positioned to create value
Slide 21: Commercial execution
21 Commercial execution VASU RAJA CHIEF COMMERCIAL OFFICER
Slide 22: Airline revenues trend with GDP
22 Airline revenues trend with GDP 104% 107% 111% 117% 122% 121% 134% 146% 155% 100% 99% 104% 111% 116% 44% 76% 125% 141% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Gross domestic product (GDP) Airline industry revenue Source: Philadelphia Federal Reserve (GDP), Airline financials (Industry r
Slide 23: Some sources of revenue have grown faster and more consistently
23 Some sources of revenue have exhibited faster and more consistent growth 1. Total frequent flyer program (FFP) related revenue, including passenger and non-passenger components. Source: Company reports, internal analysis. 2.1% 2.9% 4.3% Long-haul passenger Short-haul passenger FFP Revenue annuali
Slide 24: Uniquely positioned to produce durable earnings
24 We are uniquely positioned to produce durable earnings Our short-haul network is the foundation of value for customers and investors AAdvantage® — our travel rewards program — is our source of value growth for customers and investors
Slide 25: Grow value for customers and investors
25 Grow value for customers and investors Building the best network Building the best travel rewards program Conclusion
Slide 26: Building the best network
26 Building the best travel rewards program Conclusion Building the best network Grow value for customers and investors
Slide 27: Global hub-and-spoke network carrier
27 LAX PHX DFW ORD MIA CLT NYC PHL DCA We are a uniquely positioned global hub-and-spoke network carrier
Slide 28: The customer landscape is changing
28 124.0% 89.0% 86.0% Sun Belt Other States NYC, Boston, LA, Bay Area 2.6% 1.0% 0.2% Sun Belt Other States NYC, Boston, LA, Bay Area The customer landscape is changing 1. Sun Belt includes AL, AR, AZ, FL, GA, KY, LA, MS, NC, NM, NV, SC, TN, TX. Source: Census Bureau, Bureau of Economic Analysis. … a
Slide 29: The competitive landscape is also changing
29 The competitive landscape is also changing Note: Largest/smallest markets based on 2019 seats, industry includes 11 largest U.S. carriers. Source: Cirium. > 10% fewer seats in the smallest markets 102% 89% 25 largest markets 200 smallest markets Industry seats 2022 vs 2019 %
Slide 30: Changing trends create opportunity
30 Changing trends create opportunity Source: Yield: internal analysis, FY 23 % of Continental U.S. average among spokes served by American (25/25 largest, 103/200 smallest); Average daily demand: GDD, Continental U.S. airports with FY 23 >10 average passengers daily each way (PDEW). … and over 60%
Slide 31: Our hub structure creates a unique network advantage
31 Our hub structure creates a unique network advantage Source: Cirium, internal analysis (March 2024). Our hubs provide the best service for customers in higher-growth markets at competitive economics LAX PHX DFW ORD El Paso, TX Example: El Paso, TX (ELP) • 14 peak-day departures • Nonstop flights
Slide 32: Regional jets create access to more markets at low cost
32 Aircraft operating cost Regional jets create access to more markets at low cost … Mainline narrowbody Regional jet ~60% lower Our fleet structure enhances this advantage Note: Trip cost, B737/A321 vs 76-seat regional jet. Source: Internal analysis.
Slide 33: Our network creates the most value for customers
33 As a result, our network creates the most value for customers American Other carriers Network carrier with superior network offering Source: Cirium, March 2024 schedules; superior network offering based on peak day departures and/or nonstop destinations among network carriers, domestic originatin
Slide 34: Competitive advantage will continue to grow
34 The strength of this competitive advantage will continue to grow Source: Cirium, March 2024; Continental U.S. + short-haul Latin America spokes where American offers most peak day departures and/or most nonstop routes among network carriers. (American + US Airways) 51% 59% 68% 2014 2019 2023 Perc
Slide 35: Partnerships with high-quality carriers worldwide
35 Our short-haul network also drives valuable partnerships with other high-quality carriers around the world Note: Select airline partners depicted. Source: Long-haul demand coverage based on Cirium selling schedules for July 2024, demand based on YE October 2023 (GDD). American network + partners
Slide 36: Partnerships serve highest-yielding global markets
36 Rest of Asia Tokyo +13% And these partnerships enable us to serve customers in the highest-yielding global markets Note: FY 19 stage length adjusted yield, LHR/TYO vs other markets in the geography served year-round. Source: Cirium. American long-haul yield Rest of Europe London +24%
Slide 37: Fleet investment enables growth flexibility
37 Fleet investment enables growth flexibility while also providing a hedge against demand volatility Widebodies: fleet simplification > seasonal hub flexibility > higher utilization Atlantic: Demand peaks in summer South Pacific & South America: Demand peaks in winter B787 crew bases in DFW, MIA &
Slide 38: A321XLR versatility and improved economics
38 Fleet investment enables growth flexibility while also providing a hedge against demand volatility A321XLR: versatility & improved economics Transcontinental revenue/trip Trans-Atlantic cost/seat ~ 15% higher ~ 25% lower LAX JFK Note: A321XLR economics compared to existing aircraft deployed in tr
Slide 39: Building the best network
39 Building the best network Travel demand is growing in small and mid-size markets Our short-haul network is uniquely advantaged in serving these customers at scale We are building a profitable long-haul franchise for customers in these markets based on our short-haul network strength, durable air
Slide 40: Building the best travel rewards program
40 Building the best network Conclusion Building the best travel rewards program Grow value for customers and investors
Slide 41: Revenue driven by AAdvantage customers demanding premium content
41 Our revenue is increasingly driven by AAdvantage® customers who demand premium content Note: Percentages rounded, revenue excludes cargo, premium content includes products other than the lowest selling fare and revenue enabled by air/currency partnerships. > 80% of revenue from AAdvantage® member
Slide 42: Revenue from AAdvantage customers and premium content
42 Our revenue is increasingly driven by AAdvantage® customers who demand premium content Note: Percentages rounded, revenue excludes cargo, premium content includes products other than the lowest selling fare and revenue enabled by air/currency partnerships. 70% 80% 2017 2024 Percentage of revenue
Slide 43: More premium seats than any other airline
43 2026E 2023 premium seats 2023 +20% We offer more premium seats than any other airline Note: First class, business class and premium economy scheduled seats. Source: FY 23 Cirium, FY 26 internal analysis.
Slide 44: Among the largest co-branded travel credit cards
44 We have among the largest co-branded travel credit cards Source: External analysis. U.S. co-branded credit card programs by estimated purchase volume, 2023
Slide 45: AAdvantage has significant growth potential
45 Despite its size, AAdvantage® has significant growth potential 2023 population Note: Unique customers, active AAdvantage® members and AAdvantage® co-brand members based on YE November 2023. Source: Census Bureau, A4A, internal analysis. All U.S. air travelers American unique customers AAdvantage®
Slide 46: Re-imagining AAdvantage to drive value
46 We are re-imagining AAdvantage® to drive value Making it easy to be an AAdvantage® customer Making AAdvantage® the most rewarding program Differentiating the travel experience for AAdvantage® customers Refreshing our AAdvantage® partnerships
Slide 47: New AAdvantage makes earning easy
47 New AAdvantage® program makes earning easy 0 miles/$ Non-preferred agencies 2 miles/$ Basic Economy in direct channels1 5 miles/$ Modern retailers Main fare 7-11 miles/$ Modern retailers Main fare Status 8-16 miles/$ Modern retailers Main fare Status Co-branded card >16 miles/$ Promotions & offer
Slide 48: Easier for companies and more efficient for American
48 The new AAdvantage®: Easier for companies and more efficient for American Source: The Beat Research (January 2020), internal analysis. AAdvantage Business¨ More rewarding for customers & businesses Both earn miles & customer earns up to 3x Loyalty Points per dollar Travel management company (TMC)
Slide 49: Modern distribution gives better content and servicing
49 The new AAdvantage®: Modern distribution gives customers better content and better servicing +9 pts Customers who use our distribution tools are more satisfied … … and this drives them to purchase premium content Customer satisfaction Premium content contribution to customer revenue Note: Custome
Slide 50: Miles take you further
50 The new AAdvantage®: Miles take you further Source: NerdWallet. 1.7 1.5 1.5 1.4 1.2 Third-party currency valuation (¢/mi) AAdvantage® offers the most redemption value of any rewards points >20 flight partners >50 non-flight partners
Slide 51: Unique and unmatched benefits across the travel journey
51 Shopping • More miles and exclusive content in digital channels • 24-hour booking hold • Status members: unique redemption offers Servicing • 100% of purchases can be serviced digitally • Expedited call center service Airport • Same-day standby • Status members: faster access • Status members: fi
Slide 52: Life is better as an AAdvantage member
52 The new AAdvantage®: Life is better as an AAdvantage® member 1H 2024 2H 2024 2025+ • Simplest way to earn miles • Best value for redeeming miles • Unique and unmatched benefits • Expand cash and miles redemption for vacations, events and experiences • Superior redemption benefits for status custo
Slide 53: Largest card program with the best rewards network
53 The new AAdvantage®: Creating the largest card program with the best rewards network Source: External analysis U.S. co-branded credit card programs by estimated purchase volume
Slide 54: New card program will drive greater value
54 ~ 7% ~ 10% 2019–2023 2023–2026E Our new card program will drive value at a greater rate than it does today Note: Co-branded revenue remuneration based on cash earned. Co-branded remuneration annualized growth GDP 4.9%
Slide 55: Building the best travel rewards program
55 Building the best travel rewards program 80% of our revenues1 come from customers who demand quality travel experiences rather than the cheapest fare AAdvantage® satisfies this demand by rewarding customers who spend on higher- value products and services in exchange for unique and unmatched trav
Slide 56: Grow value for customers and investors
56 Grow value for customers and investors Building the best network Building the best travel rewards program Conclusion
Slide 57: Uniquely positioned to produce durable earnings
57 We are uniquely positioned to produce durable earnings Our short-haul network is the foundation of value for customers and investors AAdvantage® — our travel rewards program — is our source of value growth for customers and investors
Slide 58: American growing value for customers and investors
58 American growing value for our customers and investors Competitively advantaged short-haul network and air partnerships Sustainable long-haul network growth Re-imagined and competitively unique travel rewards program Industry-leading revenue growth that is durable across the business cycle
Slide 59: Operational excellence
59 Operational excellence DAVID SEYMOUR CHIEF OPERATING OFFICER
Slide 60: Compelling value-creating drivers
60 Compelling value-creating drivers Reengineering the business Asset utilization, productivity, procurement Operational excellence Strong, reliable operation Rewards Leading travel rewards program & co-branded credit card opportunity Network Strongest domestic & short-haul international network Fle
Slide 61: Delivering a reliable operation — efficiently
61 Delivering a reliable operation — efficiently.
Slide 62: Investing in operational resilience
62 Plan Execute Recover Investing in operational resilience
Slide 63: A strong operational foundation
63 A strong operational foundation Historic full-year completion factor % Source: Representative internal data. 2014–2019 2023 97.4 98.9 +1.5 points 30,000 Additional flights 3 million Passengers ~ $100 million Net operating income benefit ~ $350 million Revenue
Slide 64: A strong operational foundation
64 2023 full-year completion factor %, Major network carriers’ combined operation 98.9 98.8 98.2 Airline #2 Airline #3 Average scheduled daily departures 5,511 4,507 4,174 A strong operational foundation Source: Internal data. Source: Internal data and masFlight. Historic full-year completion factor
Slide 65: Our customers are noticing
65 Our customers are noticing 2019 2023 +11 points Source: Net Promoter Score. Net Promoter Score 2023 vs 2019
Slide 66: Driving further efficiencies
66 Driving further efficiencies Workforce and schedule planning Decision support tools Asset utilization
Slide 67: Improved utilization of our assets
67 Improved utilization of our assets Younger, simplified fleet Predictive maintenance work Electronic maintenance records
Slide 68: Increasing engine overhaul capacity by 60%
68 Increasing engine overhaul capacity by 60%. Source: Internal data.
Slide 69: Using technology and big data to solve optimally
69 Everyday decisions Irregular operations Using technology and big data to solve optimally
Slide 70: Mastering the turn
70 Mastering the turn Catering Servicing lavatories Deplaning/boarding Fueling Unloading/loading bags Cleaning
Slide 71: Visibility into performance
71 Visibility into performance Note: Data shown is illustrative.
Slide 72: Using technology and big data to solve optimally
72 Using technology and big data to solve optimally Everyday decisions Irregular operations
Slide 73: The entire team is pursuing operational excellence
73 The entire team is pursuing operational excellence.
Slide 74: Reengineering with technology
74 Reengineering with technology GANESH JAYARAM CHIEF DIGITAL & INFORMATION OFFICER
Slide 75: Bringing experience of tech transformation to American
75 Bringing experience of tech transformation to American Better, faster, happier and > 100% ROI over three years Reduced time to market - 68% Increased deploy frequency + 382% Improved employee NPS + 63 pts Better and greater output + 166% Source: Scrum Inc.
Slide 76: Driving to an organization-wide tech-first mindset
76 Driving to an organization wide tech-first mindset Added leadership with deep technical expertise and cross- industry exposure Shifting from projects to product model with persistent teams Top-down approach to re- imagine what we do and ensure we use technology to its fullest potential
Slide 77: Smart Gating and HEAT
77 Leveraging technology to enable the strategy and reengineer the airline • Launched in November 2021 and developed in-house at American • Uses real-time flight data and machine learning to improve performance • Helps shorten taxi times by 17 hours/day and saves >1.4M gallons of fuel/year Smart Gat
Slide 78: eAML: Electronic Aircraft Maintenance Log
78 Leveraging technology to enable the strategy and reengineer the airline • Developed in-house at American • Digital replacement of an aircraft’s physical maintenance logbook, utilizing best-in-class satellite Wi-Fi • Less customer disruption and higher NPS due to fewer delays and higher completion
Slide 79: GET STAT and mobile app
79 Leveraging technology to enable the strategy and reengineer the airline • Simpler, more intuitive user interface for customers and team members • Microservices, platforms and cloud hosting to enable scalability • Agile development and delivery mindset GET STAT Situational Turn Awareness Tool Mobi
Slide 80: Technology driving efficiencies and best-in-class products
80 Launching industry-leading digital products with higher levels of personalization, resiliency and security Leveraging technology to enable the strategy and reengineer the airline Driving to an organization wide tech-first mindset Technology is driving efficiencies and delivering best-in-class pro
Slide 81: Leading performance and accountability
81 Leading performance and accountability COLE BROWN CHIEF PEOPLE OFFICER
Slide 82: Fostering accountability and high-performing teams
82 Fostering accountability and high-performing teams Introduction and joining American Hiring: The right talent in the right place Culture of performance and accountability
Slide 83: Fostering accountability and high-performing teams
83 Fostering accountability and high-performing teams Introduction and joining American Hiring: The right talent in the right place Culture of performance and accountability
Slide 84: Officer team
84 Internal: Incumbents Internal: New position External Source: Internal data. Officer team
Slide 85: We continue to attract talent
85 We continue to attract talent for roles across the airline In the past 18 months, we hired more than 40,000 team members across the workgroups representing the airline. Source: Internal data. Since the pandemic, 25% of the team is new to American.
Slide 86: We continue to attract talent
86 We continue to attract talent for roles across the airline Source: Internal data. Since the pandemic, 25% of the team is new to American. In the past 18 months, we brought on more than 40,000 team members, including: • 4,200 Pilots • 2,300 Dispatchers and Technical Operations
Slide 87: Fostering accountability and high-performing teams
87 Fostering accountability and high-performing teams Introduction and joining American Hiring: The right talent in the right place Culture of performance and accountability
Slide 88: Changing culture: performance, measurement and accountability
88 Fostering accountability and high-performing teams Changing culture: Performance, measurement and accountability • Revamped our talent, planning and performance management processes • More rigorous approach to assess, select, hire, promote and reward talent Note: Data shown is illustrative.
Slide 89: We are a different airline
89 We are a different airline. Our culture has changed to one focused on performance, delivery and accountability.
Slide 90: A culture of performance and accountability
90 A culture of performance and accountability Unleash and empower team members Right talent in the right place Accountability Winning for our stakeholders
Slide 91: Maximizing value creation
91 Maximizing value creation DEVON MAY CHIEF FINANCIAL OFFICER
Slide 92: Compelling value-creating drivers
92 Compelling value-creating drivers Reengineering the business Asset utilization, productivity, procurement Operational excellence Strong, reliable operation Rewards Leading travel rewards program & co-branded credit card opportunity Network Strongest domestic & short-haul international network Fle
Slide 93: Fleet transformation: 2014–2022
93 Fleet transformation: 2014–2022 • 630 new deliveries and 580 retirements • Largest reconfiguration program in aviation history • 505 aircraft • Added premium seats • Optimized configuration • Wi-Fi, large bins • Result is incredibly consistent and efficient fleet Source: Internal data.
Slide 94: Fleet simplification: nine fleet types
94 Fleet simplification Prior to simplification, American operated nine different fleet types MD-80 E190 737 787 A320 family 777 767 A330 757 2019 Aircraft Families
Slide 95: Mainline fleet reduced to four aircraft families
95 Fleet simplification Mainline fleet reduced to four aircraft families MD-80 E190 737 787 A320 family 777 767 A330 757 Today Average age: 13 years 2019 Aircraft Families 737 787 A320 family 777 Aircraft Families
Slide 96: Order supports gauge and premium growth
96 Order supports gauge and premium growth Large narrowbody and dual-class regional share1New aircraft order Dual-class regional shareLarge narrowbody share 33% ~ 50% 2023 2030+ 82% 100% 2023 2030+ New aircraft order for 85 Airbus A321neo, 85 Boeing 737 MAX 10 and 90 Embraer E175 Smooths deliveries
Slide 97: Fleet plan enables flexibility
97 839 ~ 860 ~ 880 ~ 900 126 ~ 130 ~ 150 ~ 165 Widebody/A321XLR Narrowbody Regional Fleet plan enables flexibility No mainline retirements required through 2030 Focus on larger regional aircraft will continue to drive network connectivity 1. Fleet counts at year end. 2023 regional count is inclusive
Slide 98: Modest aircraft capex requirements
98 Modest aircraft capex requirements ~ $3.0–$3.5 $1.9 $2.3 2023 2024E 2025–2030E $B Aircraft capex Source: Airline financials.
Slide 99: Improved aircraft utilization
99 Optimized fleet and strong operation allows for improved aircraft utilization Mainline aircraft utilization 9.6 9.9 10.2 > 10.2 2022 2023 2024E 2025E+ Source: Internal data.
Slide 100: Capacity expectations
100 Capacity expectations Fleet flexibility allows us to match capacity with demand Capacity growth % Mid-single digits 2024E 2025E+ In line with demand
Slide 101: Reengineering the business
101 Reengineering the business
Slide 102: Targets over $1B in run-rate savings
102 Reengineering the business targets over $1B in run- rate savings Asset utilization Productivity Procurement
Slide 103: Improve asset utilization
103 Improve asset utilization Full supportability of the regional fleet Increase productive aircraft counts Network efficiency 2023 2024E 2025E 2026E Regional aircraft underutilized IT Operations Planning Network Planning
Slide 104: Enhancing productivity
104 Enhancing productivity Underpinned by modern technology and streamlined processes Modern planning & scheduling tools Onboarding & training Self-service tools Individual data & accountability Day-of optimization
Slide 105: Growing efficiently and enhancing productivity
105 7.3% 6.7% Mid-single digits 11.1% 2.4% ~ 1% 2014–2019 2023 2024E Total ASMs Avg. mainline FTE Growing efficiently and enhancing productivity Capacity growth and average headcount growth % New tools and processes enable efficient and productive growth to drive unit cost improvement Source: Intern
Slide 106: Transforming procurement
106 Fuel Other third-party spend Modernize procurement operating model Strategic category management Improve net working capital Digital automation Transforming procurement Our focus Third-party spend category ~ $30B Source: Internal data.
Slide 107: Best-in-class unit cost performance
107 3.5% 4.2% 5.2% Best-in-class unit cost performance Focus on cost control and fleet-related efficiencies has resulted in the lowest unit cost growth among network carriers CASM-ex1 CAGR 2019–2023 % 1. CASM excluding fuel, special items, third party, refinery, and profit sharing and is a non-GAAP
Slide 108: CASM-ex growth
108 CASM-ex1 growth YoY % Note: The Company is unable to fully reconcile certain forward-looking guidance to the corresponding GAAP measure because the full nature and amount of net special items cannot be determined at this time. 1. CASM excluding fuel, special items and profit sharing and is a non
Slide 109: Financial targets
109 Financial targets
Slide 110: Adj. EBITDAR margin expansion
110 ~ 14% ~ 14%–16% ~ 15%–18% 2024E 2025E 2026E+ Adj. EBITDAR margin expansion We expect to expand margins with continued operational outperformance, commercial innovation and unit cost efficiency Adj. EBITDAR margin1 % Note: The Company is unable to fully reconcile certain forward-looking guidance
Slide 111: Free cash flow generation
111 $1.8 ~ $2 > $2 > $3 2023 2024E 2025E 2026E+ Free cash flow generation Earnings targets coupled with moderate capex profile are expected to result in FCF of at least $2B per year through 2025 Free cash flow1 $B Note: The Company is unable to fully reconcile certain forward-looking guidance to the
Slide 112: Balance sheet strengthening
112 2Q 2021 YE 2024E YE 2025E Longer term Balance sheet strengthening Total debt reduced by ~ $11.4 billion1 from peak levels and have achieved over 75% of our $15 billion debt reduction goal2 Peak ~ $13 ~ $15 Total debt3 $B 1. As of December 31, 2023. 2. Goal to reduce total debt from peak levels i
Slide 113: Financial targets
113 Financial targets Note: The Company is unable to fully reconcile certain forward-looking guidance to the corresponding GAAP measure because the full nature and amount of net special items cannot be determined at this time. 1. Adjusted EBITDAR margin is a non-GAAP measure. Adjusted EBITDAR is def
Slide 114: American is well-positioned to create value
114 Commercial opportunities Fleet Network Rewards Focused execution Operational excellence Reengineering the business Margin expansion Long-term free cash flow generation American is well-positioned to create value
Slide 115: Appendix
115 Appendix
Slide 116: GAAP to non-GAAP reconciliation
116 GAAP to non-GAAP reconciliation The Company sometimes uses financial measures that are derived from the condensed consolidated financial statements or otherwise provided in the form of guidance but that are not presented in accordance with GAAP to understand and evaluate its current operating pe
Slide 117: GAAP to non-GAAP reconciliation
117 GAAP to non-GAAP reconciliation Footnotes: (1) The 2019 twelve month period mainline operating special items, net principally included $271 million of fleet restructuring expenses, a $213 million non-cash impairment charge principally related to the retirement of the Company's Embraer E190 fleet
Slide 118: Free cash flow summary
118 The Company's free cash flow summary is presented in the table below, which is a non-GAAP measure that management believes is useful information to investors and others in evaluating the Company's ability to generate cash from its core operating performance that is available for use to reinvest