LATAM Airlines Group (LTM) Q2 2024 earnings summary

Executive summary

• Achieved robust revenue and net income growth in Q2 2024, with net income of $146 million and 13.2% revenue growth year-over-year, despite seasonally weaker demand and macroeconomic pressures.

• Transported over 39.4 million passengers in the first half, up 15.5% year-over-year, surpassing pre-pandemic levels.

• Relisted on the NYSE after more than four years, enhancing liquidity and visibility, with a secondary ADR offering.

• Customer satisfaction at historic highs, recognized as the best airline in South America for the fifth consecutive year and received multiple industry awards.

Financial highlights

• Q2 2024 revenues reached $3.03 billion, a 13.2% increase year-over-year, with net income of $146 million and adjusted EBITDAR of $619 million.

• Net income for H1 2024 totaled $405 million, up 52.9% from 2023.

• Adjusted operating income was $274 million, negatively impacted by $25 million due to Porto Alegre airport flooding.

• Adjusted passenger CASK ex-fuel decreased 4.7% year-over-year to $0.041 (4.1 cents).

• Positive cash flow generation of $177 million before dividend payment in Q2-24.

Outlook and guidance

• Confident in meeting full-year 2024 guidance, supported by stable demand and strong first-half results.

• 2024 guidance: ASK growth 14–16%, revenue $12.8–13.1 billion, adjusted EBIT $1.4–1.6 billion, adjusted EBITDAR $2.75–3.05 billion.

• Minor ongoing impact from Porto Alegre closure expected in Q3, with full capacity redeployment by August and airport reopening anticipated in October.

• No significant risks identified that would prompt a downward revision of guidance.

• Focus on refinancing a significant portion of non-fleet debt in Q4-24, expected to improve earnings.