LATAM Airlines Group reported last Tuesday, March 9, its financial results for the last quarter of 2020 and the consolidated results for the whole year, in which it reached record negative numbers as a result of the impact of the pandemic on its operations.
Total operating revenue reached USD 897 million, a 68.7% drop from the last three months of the previous year, but a 74% recovery compared to the third quarter of 2020, marking the pace of recovery. The operating loss reached USD 501.8 million (USD 350 million operating profit in the fourth quarter of 2019).
The group’s net losses reached USD 962.5 million in the last quarter when during the same period of 2019 it had obtained profits of USD 227 million.
Between October and December, passenger traffic (in RPK) registered a 71.2% drop compared to the same period of the previous year, while capacity (in ASK) fell 67.1% resulting in a load factor of 72.4%, 10.5 percentage points less. In all cases, there was a significant improvement -fifteen points approximately- compared to the third quarter.
The number of passengers transported was 7.4 million, 62.9% less than between October and December 2019 but 4.8 million more than between July and September 2020.
On the other hand, cargo incomes reached USD 354 million, 26.7% more than during the same period of 2019, even when capacity was reduced by 24.1% due to the lack of belly cargo (RTK demand was decreased by 10%, causing the load factor to stand at 66.9%, an increase of 10.5 percentage points).
2020
Regarding the consolidated data for last year, LATAM Airlines Group recorded revenues of USD 4.33 billion, a drop of 58.4% compared to 2019.
Operating costs reached USD 5.99 billion (-38.1%), giving an operating result of -1.65 billion compared to profits of USD 741 million registered the previous year.
Taking into account taxes, costs and financial incomes, the group closed with a net loss of USD 4.54 billion, when in 2019 it had obtained profits of USD 190 million.
Regarding operational data, in 2020 LATAM recorded a 65.8% drop in passenger traffic (in RPK) while seat offering (in ASK) fell 62.7%, resulting in a 76.5% load factor (-7 percentage points).
In total, 28.2 million passengers were transported, a drop of 61.9% compared to the 74.18 million on board in 2019.
Cargo transport, which produced revenues of USD 1.2 billion (+ 13.7%), registered a 25.9% drop in capacity and 12.7% in demand, causing the load factor to rise by 9, 9 percentage points, standing at 65.4%. The group will continue betting on this business unit with special attention. An agreement with Boeing was recently confirmed to convert eight passenger Boeing 767-300s to freighters.
As of December 31, 2020, LATAM had USD 1,695 million in cash in addition to another USD 1,300 million in DIP financing lines within the framework of the restructuring process under Chapter 11 of the United States Bankruptcy Law.
«2020 was the most challenging year in history for the aviation industry and for LATAM. Although the COVID-19 crisis had profound effects on the group and its operations, and will continue to have them for a while, this context allowed us to make reform decisions. We will emerge as a closer, simpler, more agile and more efficient company. We have no doubts that when the crisis passes, LATAM will operate as a strengthened group» Roberto Alvo said, CEO of LATAM Airlines Group.
