UPDATE 1-LATAM Airlines posts loss on weak economic growth, World Cup
(Adds company's comments, details)
SANTIAGO Nov 13 (Reuters) - LATAM Airlines, Latin America's largest airline, on Thursday reported a larger-than-expected net loss for the third quarter, due to a fall in business travelers and cargo traffic during soccer's World Cup in Brazil and weakening regional economic growth.
A foreign exchange loss of $144 million, mostly due to a depreciating Brazilian real, also weighed on the carrier's bottom line.
The net loss was $107.8 million in the three months to the end of September, traditionally its strongest quarter, the company said. That compared with a profit of $52 million a year ago and market forecasts for a $1 million loss, according to a Reuters survey.
Revenues in the third quarter were $3.05 billion, versus $3.27 billion in the year-ago period.
The market is still waiting for LATAM to fulfill the promise of its 2012 merger, when it was formed in a tie-up between Chile's LAN and Brazil's TAM to create a regional giant that could ward off potential competition from U.S. airlines.
It has been deleveraging and cutting capacity in Brazil as it has tried to fill planes and shore up margins, but weak economic growth in its key markets has taken a toll.
"We acknowledge that results have not met our expectations, mainly because we are facing a context with increased competition, a weaker macroeconomic scenario in South America, especially in Venezuela and Argentina, and depreciated local currencies. All of these have put significant pressure on yields throughout the region for all players in the industry," LATAM said.
The airline, which has domestic operations in Argentina, Brazil, Chile, Colombia, Ecuador and Peru, said it expects total passenger capacity growth based on available seat-kilometers of between 2 percent and 4 percent for full-year 2015. Continuación...