LATAM Airlines Group's merger anniversary marked by USD300 million loss in tough operating dynamics

LATAM Airlines Group during 2Q2013 marked the first anniversary of its landmark merger between South America's largest airline groups LAN and TAM with an overall loss of USD300 million for the historically weaker quarter, which also reflects the continuing struggles LATAM faces in the depreciation of the BRL against the USD.

But against those challenges LATAM has seen improvement in its domestic Brazilian operations as unit revenues in those markets grew 14% mainly driven by load factor growth.

Unlike Brazil's second largest carrier Gol, LATAM's scale is providing opportunities for the company to reduce its exposure to currency fluctuations, decrease its capital commitments and realign its fleet in certain operations to improve unit costs. All those initiatives allow LATAM's management to remain confident that all the reasons behind their tie-up remain sound, and the underlying potential to deliver long-term financial benefits remains intact.