American Airlines 2002 Annual Report Download - page 65

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63
4. Goodwill and Other Intangible Assets (Continued)
The following tables provide information relating to the Company’s amortized intangible assets as of
December 31 (in millions):
2002
Cost
Accumulated
Amortization
Net Book
Value
Amortized intangible assets:
Airport operating rights $ 516 $ 178 $ 338
Gate lease rights 204 79 125
Total $ 720 $ 257 $ 463
2001
Cost
Accumulated
Amortization
Net Book
Value
Amortized intangible assets:
Airport operating rights $ 516 $ 157 $ 359
Gate lease rights 209 72 137
Total $ 725 $ 229 $ 496
Airport operating and gate lease rights are being amortized on a straight-line basis over 25 years to a zero
residual value. For the years ended December 31, 2002 and 2001, the Company recorded amortization expense
of approximately $28 million and $29 million, respectively, related to these intangible assets. The Company
expects to record annual amortization expense of approximately $28 million in each of the next five years related to
these intangible assets.
The pro forma effect of discontinuing amortization of goodwill and route acquisition costs under SFAS 142
- assuming the Company had adopted this standard as of January 1, 2000 – results in an adjusted net loss of
approximately $1,722 million, or $11.17 per share for the year ended December 31, 2001, and adjusted net
income of approximately $838 million, or $5.59 per share basic and $5.18 per share diluted for the year ended
December 31, 2000.
The Company had route acquisition costs of $829 million as of December 31, 2002 and 2001.
5. Investments
Short-term investments consisted of (in millions):
December 31,
2002 2001
Overnight investments and time deposits $ 572 $ 461
Corporate and bank notes 832 506
U. S. Government agency notes 285 687
U. S. Government agency mortgages 142 43
Asset backed securities 3 185
U. S. Treasury notes 2 490
Other 10 14
$ 1,846 $ 2,386