LATAM Airlines Group has announced its financial results for the fourth quarter of 2021, which show continuous improvement in air traffic levels as a result of the easing of travel restrictions, and the progress of vaccinations.
During the last quarter, total operating income reached US$1,995.9 million, 30.5% below 2019 levels, but 51.9% higher than the third quarter of 2021. For the first time since the pandemic began, the group recorded a positive operating result, amounting to US$73.4 million during the quarter.
Overall, total revenues reached US$5,111.3 million during 2021, a 51.0% decrease compared to 2019.
LATAM’s operations reached 63.5% of 2019 levels during the quarter (measured in ASK), corresponding with a capacity increase of 29.6% compared to the third quarter of 2021, mainly driven by the reactivation of domestic traffic.
As in previous quarters of 2021, the operation of LATAM’s cargo subsidiaries continued to show solid performance, with revenues that increased 66.0% compared to the same period in 2019, amounting to US$464.8 million. The slow recovery of international flights has prevented the return to pre-pandemic levels of capacity.
Total operating expenses were $1,992.4 million in the fourth quarter of 2021, representing a decrease of 23.7% compared to the same period in 2019, following the group’s cost restructuring efforts. The CASK (cost per ASK) ex-fuel improved 25.0% compared to the third quarter of 2021, from US$7.4 cents to US$5.6 cents. Operation-related costs remain below pre-2019 pandemic levels however have shown an increase in recent quarters, driven by operational recovery and strong fuel price increases.
Roberto Alvo, CEO of LATAM Airline Group, said “We hope that the operation continues to recover to reach the magnitudes that we knew in 2019. We cannot lose sight of the fact that we find ourselves in an uncertain time, not only due to the effects of the new COVID-19 variants but now also due to the Ukraine conflict that has impacted the price of oil”.
The group is awaiting the approval of its Disclosure Statement by the Court in the United States. In addition, LATAM is aiming to come out of Chapter 11 during the second half of 2022 with a more agile, restructured organisation with a solid balance sheet, a competitive cost structure and strong liquidity, which will allow it to tackle future business challenges on a sound footing.
In 2021, LATAM group simplified processes, redesigned fleet strategies, renegotiated contracts and restructured costs. In the midst of the pandemic, LATAM presented its sustainability strategy for 2050 with a focus on climate change, the circular economy, and shared value.
The sustainability strategy includes well-defined goals: zero waste to landfill by 2027, carbon neutral by 2050, and the protection of iconic ecosystems in South America. In support of the protection of iconic ecosystems, LATAM has formed an alliance with the Cataruben Foundation, a project focusing on the conservation and restoration of an iconic ecosystem that covers 200,000 hectares of floodable savannah located in the Orinoquía region of Colombia.
LATAM’s “Solidarity Plane” program, which seeks to generate value to society through the transportation of medical supplies, personnel and cargo at no cost, the group has transported more than 232 million COVID-19 vaccines, in addition to carrying more than 3,400 health professionals to address urgent needs related to the pandemic.
