Cash Flow Statement

The cash flow statement provides information about a company cash receipts and cash payments during an accounting period, showing how these cash flows link the ending cash balance to the beginning balance shown on the company balance sheet.

The cash flow statement consists of three parts: cash flows provided by (used in) operating activities, cash flows provided by (used in) investing activities, and cash flows provided by (used in) financing activities.

American Airlines Group Inc., consolidated cash flow statement

US$ in millions

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income (loss)	822)	127)	(1,993)	(8,885)	1,686)
Depreciation and amortization	2,254)	2,298)	2,335)	2,370)	2,318)
Debt extinguishment costs	267)	3)	31)	—)	—)
Special items, net non-cash	41)	226)	52)	1,599)	376)
Pension and postretirement	(13)	(405)	(321)	(319)	(178)
Deferred income tax provision (benefit)	299)	65)	(555)	(2,568)	560)
Share-based compensation	102)	78)	98)	91)	94)
Net gains from sale of property and equipment and sale-leaseback transactions	—)	—)	(22)	(95)	(112)
Other, net	(205)	(37)	38)	47)	(62)
(Increase) decrease in accounts receivable	95)	(637)	(304)	538)	73)
(Increase) decrease in other assets	(11)	(775)	(402)	(38)	(373)
Increase (decrease) in accounts payable and accrued liabilities	873)	585)	461)	(626)	327)
Increase (decrease) in air traffic liability	(545)	658)	1,454)	(51)	469)
Increase (decrease) in loyalty program liability	182)	10)	(60)	580)	76)
Contributions to pension plans	(73)	(5)	(247)	(9)	(1,230)
Increase (decrease) in other liabilities	(285)	(18)	139)	823)	(209)
Changes in operating assets and liabilities	236)	(182)	1,041)	1,217)	(867)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities	2,981)	2,046)	2,697)	2,342)	2,129)
Net cash provided by (used in) operating activities	3,803)	2,173)	704)	(6,543)	3,815)
Capital expenditures, net of aircraft purchase deposit returns	(2,596)	(2,546)	(208)	(1,958)	(4,268)
Proceeds from sale of property and equipment and sale-leaseback transactions	230)	147)	374)	1,016)	904)
Sales of short-term investments	8,861)	14,972)	13,923)	2,803)	4,144)
Purchases of short-term investments	(7,323)	(11,257)	(19,454)	(5,873)	(3,184)
(Increase) decrease in restricted short-term investments	51)	1)	(401)	(308)	(3)
Purchase of equity investments	—)	(321)	(28)	—)	—)
Other investing activities	275)	(360)	(189)	(22)	164)
Net cash (used in) provided by investing activities	(502)	636)	(5,983)	(4,342)	(2,243)
Payments on long-term debt and finance leases	(7,718)	(3,752)	(7,343)	(3,535)	(4,190)
Proceeds from issuance of long-term debt	4,822)	1,069)	12,190)	11,780)	3,960)
Proceeds from issuance of equity	—)	—)	460)	2,970)	—)
Dividend payments	—)	—)	—)	(43)	(178)
Other financing activities	(310)	52)	(19)	(178)	(1,160)
Net cash provided by (used in) financing activities	(3,206)	(2,631)	5,288)	10,994)	(1,568)
Net increase (decrease) in cash and restricted cash	95)	178)	9)	109)	4)
Cash and restricted cash at beginning of year	586)	408)	399)	290)	286)
Cash and restricted cash at end of year	681)	586)	408)	399)	290)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Profitability Trends: Net income exhibited significant volatility over the five-year period. The company realized a strong profit of $1,686 million in 2019 before facing a substantial loss of $8,885 million in 2020, reflecting the impact of external challenges during that year. Although still negative in 2021, the loss narrowed to $1,993 million. Subsequently, the company returned to profitability with a modest net income of $127 million in 2022, improving to $822 million in 2023.
Depreciation and Amortization: Depreciation and amortization expenses remained relatively stable, declining slightly from $2,318 million in 2019 to $2,254 million in 2023, indicating consistent asset usage and capital expenditure patterns.
Special and Non-Cash Items: Special items, net non-cash, showed a large spike in 2020 at $1,599 million, likely associated with restructuring or impairment events, before subsiding in subsequent years. Debt extinguishment costs were negligible until 2021 but markedly increased in 2023 to $267 million, suggesting significant debt repayments or refinancing activity. Pension and postretirement expenses remained negative throughout the period, with a notable decrease in impact from -$405 million in 2022 to -$13 million in 2023.
Income Tax Provision: The deferred income tax benefit was significantly negative in 2020 at -$2,568 million but improved to positive figures in 2022 and 2023, marking a reversal that may reflect improved profitability or deferred tax asset utilization.
Working Capital Movements: Changes in accounts receivable and other assets mostly exhibited decreases in 2021 and 2022, implying asset reductions, followed by a partial reversal in 2023. Accounts payable and accrued liabilities fluctuated substantially, with pronounced increases in 2022 and 2023, reflecting improved short-term liquidity management or vendor payment deferrals. Air traffic liability showed a large increase in 2021, likely related to customer prepayments, which declined sharply in 2023. Loyalty program liability varied considerably, rising in 2020 and 2023 but dipping in 2021, indicating changing customer loyalty program activities.
Cash Flow from Operations: Net cash from operating activities sharply declined into negative territory in 2020, consistent with the losses in that year, then recovered to positive cash flow in 2021 and improved further through 2023, signaling operational resilience and recovery over time.
Investing Activities: Capital expenditures fluctuated modestly but remained substantial, with a peak net outflow of $2,596 million in 2023. Proceeds from asset sales declined after 2020, reflecting reduced disposals or sale-leaseback transactions. Notably, short-term investments were actively managed, with large sales in 2021 and 2022 partially offset by significant purchases particularly in 2021. Other investing activities were mixed, shifting from negative to positive values by 2023. Overall, net cash used in investing activities was negative in most years except for 2022 when it generated positive cash flow.
Financing Activities: Debt management was highly active, with large payments on long-term debt and finance leases each year, particularly in 2023 at $7,718 million, exceeding proceeds from debt issuance that year. The issuance of long-term debt peaked in 2021 at $12,190 million before decreasing substantially in subsequent years. Equity issuances occurred in 2020 and 2021 but ceased thereafter. Dividend payments were minimal and ceased after 2020. Overall, financing activities generated positive cash flow in 2020 and 2021 but were negative in 2022 and 2023, reflecting a net repayment or deleveraging phase.
Liquidity Position: Cash and restricted cash balances increased modestly from $290 million at the end of 2019 to $681 million by the end of 2023, supporting a cautious liquidity management approach. The net change in cash reflected recovery from negative cash flow in 2020 to consistent increases thereafter.
Summary: Overall, the data reveal a company that experienced significant financial stress and losses during 2020 and 2021, with gradual operational and financial recovery beginning in 2022. The management of capital expenditures, operating cash flow, and financing activities shows a strategic focus on deleveraging and liquidity preservation in response to earlier challenges. The gradual return to profitability and positive operating cash flow from 2022 onwards suggests improving financial health and operational stability.

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American Airlines Group Inc. (NASDAQ:AAL)

Cash Flow Statement