Photo: LATAM Airlines Group.
LATAM Airlines Group recorded a net income of $267 million for the first half of the year, according to the financial results reported today to the United States Securities and Exchange Commission (SEC).
During the first half of 2023, LATAM Airlines Group registered total operating revenue of $5.48 billion, a 31% increase versus the same period in 2022. The airline company (which has branches in Brazil, Chile, Colombia, Ecuador, and Peru, as well as an only-cargo operator) saw an increase in demand across the region.
This increase in revenue, plus other actions taken by the company, led to a net income of $267 million at the end of the half. The management said this is a clear demonstration of LATAM group, post-restructuring, which has an ever-strengthened network, a leading value proposition for customers, diversified revenue streams, a competitive cost structure, and a strong balance sheet. The company’s Chapter 11 case file was officially closed on June 29.
Roberto Alvo, Chief Executive Officer (CEO) at LATAM Airlines Group, said,
“LATAM has been working systematically and with a long-term focus. Our financial results are the result of the combination of an effective business strategy, an attractive value proposition for customers, cost discipline, a robust network in the region, a globally-leading punctuality worldwide, and a solid balance sheet.”
Increasing routes across the board
LATAM Airlines was particularly active with regard to network expansion during the second quarter of 2023. The Peruvian branch of the company announced new routes such as Lima-Aruba and Lima-Caracas.
Within the Joint Venture Agreement with Delta Air Lines, the group announced three new routes (Medellín-Miami, Lima-Atlanta, and Cartagena-Atlanta) and a second daily flight between Bogota and Atlanta. Moreover, LATAM has already launched two new routes under this JVA: Bogota-Orlando and Sao Paulo-Los Angeles (inaugurated this week). In total, six new routes have been announced in the Delta-LATAM JVA.
Additionally, LATAM Airlines Brazil announced a new interline agreement with Airlink, a South African carrier. This new partnership, which will give access to over 40 destinations across Africa, will be available from September 2, when LATAM Brasil will resume its service to Johannesburg from Sao Paulo.
LATAM Cargo announced two new routes, Miami-Guayaquil and Miami-San José Dos Campos. This strengthened the Miami cargo hub and expanded the group’s dedicated cargo network in the region.
Finally, LATAM Colombia increased its capacity by approximately 20%. It added five aircraft to its market. As a result, the branch reached a domestic market share of 33% this quarter, following the exit of ultra-low-cost companies Viva Air and Ultra Air. LATAM Colombia was also recently allocated new slots in Bogota’s El Dorado International (BOG) for the winter season, allowing the branch to maintain its increased capacity.
LATAM closed the second quarter with a fleet comprised of 239 Airbus narrowbody aircraft, 54 Boeing widebody aircraft and 18 Boeing cargo freighters, totaling 311 planes. Additionally, LATAM has fleet commitment agreements with Airbus, Boeing, and lessors to receive both new narrow and widebody aircraft in the coming years. LATAM’s A320neo family should increase from 31 to 56 between 2023 and 2025; the 787 family should grow from 37 to 41.
