LATAM Airlines Raises Earnings Forecast After Strong First Quarter Performance

LATAM Airlines Raises Earnings Forecast After Strong First Quarter Performance

Chilean carrier LATAM Airlines raised its earnings forecasts for the year on Thursday, citing a strong first-quarter performance and increased demand.

LATAM now expects revenues for the year to range from $12.8 billion to $13.1 billion, up from the previous estimate of $12.4 billion to $12.8 billion. The adjusted EBITDAR for the year is estimated at a record $2.75 billion to $3.0 billion, a 10% to 22% increase from 2023. This is higher than the previous estimate of between $2.6 billion and $2.9 billion in December.

LATAM Airlines Raises Earnings Forecast After Strong First Quarter Performance

The airline attributed the improved outlook to boosted operations, cost-containment measures, and an improved capital structure. In the first quarter, LATAM reported $796 million in EBITDAR and a net profit of $258 million, more than double the previous year, from revenues of $3.32 billion, an 18% increase.

LATAM also saw a 17.5% growth in passenger traffic, as measured by available seat kilometers (ASK), surpassing the pre-pandemic capacity logged in 2019. The increase was attributed to a record number of passengers and higher occupation levels on flights.

Despite these gains, LATAM’s passenger costs remained steady in the quarter at 4.3 cents per ASK, while the carrier generated $137 million in cash. Chief Financial Officer Ramiro Alfonsin stated that LATAM’s liquidity allows it to be competitive, grow steadily, take on new projects calmly, and obtain better terms with providers.

The carrier, currently operating a 330-plane fleet, is expecting several aircraft deliveries this year. LATAM Airlines recently announced it was no longer seeking to acquire Boeing B737 planes, opting to look for alternative narrowbody aircraft after failed talks. Alfonsin mentioned that LATAM was considering Airbus’ A320 or A321 aircraft but remained open to alternatives.

Looking ahead, Alfonsin stated that LATAM plans to deleverage “more than expected” after closing the quarter with a financial net debt to adjusted EBITDAR ratio of 1.9 times. He also mentioned that the firm was contemplating a debt refinancing later this year.

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Pooja Chauhan: Your Source for Entertainment and Box Office News Pooja Chauhan is a passionate writer and dedicated journalist specializing in delivering the latest updates and insights from the world of entertainment and box office. With a keen eye for detail and a deep love for cinema, Pooja brings her readers accurate and engaging coverage of all things related to movies, celebrities, and the dynamic world of showbiz. Her commitment to keeping her audience well-informed and entertained makes her a valuable voice in the realm of entertainment journalism. When she's not busy uncovering the latest scoops, Pooja enjoys exploring classic films and indulging in creative writing." Contact us: [email protected]

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