MIAMI – LATAM Airlines (LA), Latin America’s largest airline group, reported losses of US$691,9m in the third quarter on Tuesday. The findings show that the company is still suffering from the fallout of the coronavirus pandemic.

LATAM explained that the group’s total revenues increased by 156% between July and September, compared to the same period the previous year; however, they were still 50% lower than before the pandemic.

“Despite the pandemic, which has yet to end and is still having an impact, we were able to close off the third quarter with a better operational performance across the board,” said Ramiro Alfonsín, LATAM Airlines’ vice president of finance.

The outcome was bolstered by improved domestic market performance over international markets and strong freight business. As such, the operating capacity for Q3 was over 50% more than it was before the pandemic. LA expects it to reach 65% by the end of the year.

Ramiro Alfonsín also stated that the group expects the Brazilian operation to return to pre-pandemic levels by the end of the year or the beginning of 2022.

According to the CEO, the company now has a cash reserve of US$2.400m. In all, the airline reported an operating loss of US$479,2m inQ3, while fuel costs increased by 258%.

LATAM Brazil Airbus A320-200ceo Photo: João Pedro Santoro/Airways

LATAM Restructuring Update

LATAM accepted bankruptcy protection in the US in May 2020, citing the impact of pandemic restrictions, and Alfonsn stated that the reorganization plan would be presented this month.

“Right now, we’re finalizing the last details of our reorganization plan,” the CEO said. “To that end, we’re meeting with stakeholders and expect to present by November 26th.”

Alfonsín went on to say that the company has the authority to use another tranche of US$750m from the DIP (Debtor in Possession) financing plan for any liquidity needs that arise.

The airline, which was formed by the merger of Chile’s LAN and Brazil’s TAM in 2012, has operational hubs in Chile, Brazil, Colombia, and Peru.

Featured image: João Pedro Santoro/Airways/Airways