LATAM Airlines Group in 2021

Let’s look at the financial results of LATAM Airlines Group in 2021. Overall, the airline group had total revenues worth US$5,011.3 million during 2021, a 51.0% decrease compared to 2019 due to the heavy impact of the COVID-19 pandemic and the company’s Chapter 11 proceedings. Financial results in a nutshell This is how LATAM Airlines Group performed in 2021: For full-year 2021, LATAM had a US$4.64 billion net loss, a 2.2% increase compared to 2020’s net loss (US$4.54 billion). In 2019, the group had a net profit worth US$190,430. LATAM carried 40.1 million passengers in 2021, a 42% increase compared to 2020, but still 45.8% below 2019 levels, prior to the COVID-19 pandemic, when it reached 74.1 million travelers, its highest level ever. The airline had passenger revenue worth US$3.34 million, still 62.9% below 2019 levels. The airline carried 802,000 tons of cargo, still 11.3% below pre-pandemic traffic levels. Nonetheless, cargo revenue soared by 44.8% compared to 2019. Total operating expenses were US$6.2 billion. At the end of the quarter, LATAM reported US$1,047.2 million in cash and cash equivalents. In addition, LATAM has access to US$1.25 billion of committed liquidity in the DIP financing as part of its Chapter 11 proceedings. Finally, LATAM’s EBITDA margin was 0.9% (in 2020 was -6.4%). Improvement to close the year Nonetheless, by 2021’s fourth quarter, the economic performance of the airline had improved significantly compared to the previous months. LATAM said, “Notably, for the first time since the start of the pandemic, the group posted a positive quarterly operating result, which amounted to US$73.4 million during the quarter.” At the operational level, and despite the changing scenarios related to COVID-19 and the affected passenger demand, LATAM ramped up its operations, measured in ASKs compared to 2019, from 39.8% in January to 70.1% at the end of the year in December 2021. Roberto Alvo, CEO of LATAM said, “We hope that the operation continues to recover to reach the magnitudes that we knew in 2019. We cannot lose sight of the fact that we find ourselves in an uncertain time, not only due to the effects of the new COVID-19 variants but now also due to the tension of a warlike conflict that has the world on alert and that has an impact on the price of oil”. Chapter 11 Currently, LATAM Airlines Group is awaiting the approval of its Disclosure Statement by the Court in the United States. LATAM is targeting to emerge from Chapter 11 during the second half of 2022, the last among the three Latin American carriers, after Avianca and Aeromexico. Once LATAM exits Chapter 11, it would close “a stage of important transformation that has allowed the establishment of a renewed organization, more agile, with a solid balance sheet, a very competitive cost structure and a good level of liquidity, which will allow it to tackle future business challenges on a sound footing,” said the airline. Finally, LATAM closed the year with a fleet composed of 304 aircraft. Moreover, it expects to receive 72 new planes between 2022 and 2028. The airline has orders for two Boeing 787-9 Dreamliners and 70 Airbus A320neo aircraft.

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Financial results in a nutshell

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