LATAM Airlines Group closed the third quarter of 2023 with a net profit of USD 232 million, and a net margin of 7.6%, a substantial improvement from the figures of the same period of the previous year, when they registered net losses of USD 263 million.
Operational revenues reached USD 3.05 billion, a growth of 18.1%, strongly driven by the passenger segment, which grew by 25.6% to reach USD 2.69 billion. The cargo unit had revenues of USD 329 million, a decrease of 20.2%.
Adjusted operational costs grew by 6.3%, reaching USD 2.65 billion. Salaries (35.5%), Agent commissions (67.3%), Passenger services (32.7%), and other operational costs (42.3%) were the items with the greatest increase, explained by the expansion of operations. The adjusted operational margin was 13.4%.
The adjusted EBITDAR of LATAM Airlines in the third quarter was USD 726 million, while cash increased by USD 104 million, bringing liquidity to USD 2.73 billion.
“We are very proud of the financial performance that the group has been showing during this third quarter and throughout the year, which has been progressively improving thanks to systematic work with a long-term vision. At the end of this quarter, the group reported a record result in revenue after a consistent recovery in passenger transport. Moreover, the capital structure of LATAM Airlines Group S.A. remains unmatched in the region, in terms of liquidity and leverage, which, combined with the unparalleled connectivity offered by the LATAM group at the regional level, shows that it is on the right path,” said Ramiro Alfonsín, CFO of LATAM.
The company maintained its guidance for all of 2023, projecting international capacity growth between 35% and 37% in 2023, between 8% and 10% in the Brazilian domestic market, and between 6% and 8% in Spanish-speaking domestic markets. Likewise, revenues are expected to be between USD 11.3 and 11.6 billion, with an EBIT margin of between 9% and 10%.
Global demand (in RPK) grew by 18.5% between July and September 2023, while capacity (ASK) increased by 15.2%, resulting in a load factor of 85.3%, an increase of 2.4 percentage points.
LATAM‘s international operations grew by 29.2% and were 13 percentage points from pre-pandemic levels, while domestically, the Brazilian subsidiary grew by 1.3% compared to 2022 (and 7.3% vs 2019), while subsidiaries in Colombia, Chile, Peru, and Ecuador grew by 9.5% (8 percentage points from pre-pandemic levels).
During the third quarter, LATAM Airlines received four Boeing 787-9s, three Airbus A320neos, three A320ceos, and one A321neo. Their fleet thus increased to 321 aircraft.
Regarding their network, daily flights to Rapa Nui were resumed, and the Santiago – Melbourne and Sao Paulo-Johannesburg routes were reopened, in addition to the announcement of the new route between Lima and London starting on December 1. Thus, their network reaches 144 destinations in 24 countries.
