LATAM posts strong Q1 results

Victoria
By Victoria May 24, 2013 12:46

LATAM posts strong Q1 results

LATAM Airlines Group has reported an operating income of US$114.2 million for first quarter 2013, a 149.8% increase compared to the US$45.7 million pro forma operating income in first quarter 2012. Operating margin reached 3.4%, an increase of 2.0 points compared to 1.4% in 2012. This result reflects a steady recovery in business operations as the group begins to realise the expected synergies from the merger between LAN and TAM.

Net income reached US$42.7 million for first quarter 2013, compared to a pro forma consolidated net income of US$83.7 million for the same period 2012, which represents a decrease of 48.9% mainly due to a foreign exchange gain of US$133.4 million recognized at TAM during the first quarter 2012.

TAM has maintained capacity discipline with a 9.2% reduction in ASKs during the first quarter 2013 as compared to the first quarter 2012. Traffic grew by 3.4%, with strong load factor improvements of 9.5 percentage points as compared to the first quarter 2012, reaching 77.7%. This led to a significant increase in revenue per ASK, as measured in Brazilian reais. Results in US dollars were affected by a 13% depreciation of the Brazilian currency during the quarter as compared to the first quarter 2012.

The group has reiterated its synergy target of between US$600 and US$700 million to be fully achieved by the fourth year after the merger (June 2016).

Total revenues in the first quarter 2013 reached US$3,409.0 million compared to pro forma revenues of US$3,360.2 million in first quarter 2012. The increase of 1.5% is a result of a 1.5% increase in passenger revenues and a 38.6% increase in other revenues, partially offset by a 3.2% decrease in cargo revenues. The slight increase in revenues reflects capacity reductions in the domestic Brazil passenger operations and a more challenging environment for international passenger operations, as well as weak market demand in the cargo business. Passenger and cargo revenues accounted for 84.2% and 13.5% of total revenues, respectively, in first quarter 2013.

During the first quarter 2013, LATAM received a total of five A320 family aircraft and one Boeing 767-300 passenger aircraft. The airline returned one A320-200 and sold two Airbus A318 aircraft.

Victoria
By Victoria May 24, 2013 12:46
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