August 21, 2018 / 12:01 AM / 2 months ago

Chile's LATAM Airlines reports 2nd qtr loss of $114 mln

Aug 20 (Reuters) - LATAM Airlines, the biggest airline group in Latin America, reported a net loss of $114 million in its second quarter, a period that is usually the weakest for air travel companies throughout the region.

But this year has brought additional challenges for airlines, including rising oil prices and a weak Brazilian real that makes international travel more costly for Brazilians, a top market for LATAM together with Chile. The company said the weaker real had netted a $79 million loss.

LATAM has struggled in recent years, amid a merger with Brazilian airline TAM in 2012 that has not boosted profits and a more intensely competitive market that prompted the airline to adopt a low-cost model for its domestic flights, including new charges for checked luggage and preferred seating options.

The company’s stock is down 27 percent so far this year in the Santiago Stock Exchange and, before the earnings release, had hit its lowest point since February 2017.

LATAM also saw losses in its second quarter results in 2017 and 2016.

Amid increasing oil prices, LATAM spent an increasing portion of its $2.3 billion revenue on fuel, 29 percent compared to 27 percent in 2017. (Reporting by Marcelo Rochabrun)

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