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LAN Airlines net income of $4.2 million in 2nd quarter

Written by thomas · Filed Under Commercial 

August 3, 2009

thomas

LAN (Latin America Network) “model airline” reported $4.2 million in net income in the second quarter of 2009, down 93% compared to $60.5 million in the same period last year. This is the direct result of the fuel hedging cost of $52.6 million compared to the fuel hedging gain of $29.2 million last year. If you exclude the negative impact of the fuel hedging, operating income was $87.6 million in the quarter compared to $56.1 million in 2008, for a 56.2% increase. The operating margin, excluding fuel hedging was a record 11.2% in the second quarter. The airline has continued to expand its presence in the region launching twice-weekly service from its hub in Lima to Cartagena during the quarter and starting daily service from Santiago to Lima via Iquique on July 10. On August 15 it will begin operating Lima-Quito-Cali three times weekly. It has also expanded its domestic operation with 13 weekly flights in Argentina from Buenos Aires to Tucuman. In addition LAN Ecuador continues to develop its domestic service, currently operating 46 weekly flights between Guayaquil and Quito as well as daily service between Guayaquil and Cuenca. During the second quarter the airline continued its passenger growth over the same period in 2008, increasing traffic by 13.5% and load factor 1.7 points to 73.6%. Cargo revenues have fallen 43.4% – in line with the trend in cargo markets worldwide. During the quarter it received two B777 freighters which are replacing B767 freighters on long haul markets. It will take delivery of two B767-300s by the end of 2009. Its total fleet will grow from 85 passenger and 11 cargo aircraft for a total fleet of 96 by the year end to 103 in 2010, 115 in 2011 and 119 in 2012.

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