LATAM FY2023 cargo revenue down 17% on softening yields

While capacity was up 15%, revenue tonne kms (RTKs) was up only 5% and revenue per RTK declined 28% in 2023

LATAM FY2023 cargo revenue down 17% on softening yields

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LATAM reported a 17.4 percent decline in cargo revenue for 2023 at $1.4 billion on softening of yields.

"The revenue, however, still remains above pre-pandemic levels," says an official release.

While capacity was up 15 percent at seven billion, revenue tonne kms (RTKs) was up only five percent at 3.7 billion. Tonnage increased five percent to 946,000 tonnes and revenue per RTK declined 28 percent to $19.9 cents for 2023, the release added.

Total revenue for the year increased 24 percent to $11.8 billion, driven by a 34 percent increase in passenger revenues. Net income was $582 million compared to a loss of $341 million in 2022.

“This performance is a reflection of a culture where we prioritise the customer, work to deliver better service, maintain a competitive cost structure, incorporate innovation and technology, strive for a sustainable business, and contribute to the societies where LATAM group companies operate. This focus enables us to deliver a better product, which has translated into very good financial results," says Roberto Alvo, CEO, LATAM Airlines Group.

For the full year 2023, LATAM group generated $498 million in cash, increasing liquidity to $2.8 billion.

Q4 cargo revenue at $364mn
For the fourth quarter ended December 31, 2023, cargo revenue came in at $364 million, down 13 percent compared to Q42022. Cargo revenue accounted for 11 percent of overall revenue of $3.3 billion in Q42023, the release added. "Despite the above, cargo revenues compared to the same period of 2019 outperformed it by 30 percent. In the quarter, cargo yields were $35.5 cents per RTK, and despite the cyclical softening of the business, were still situated 17.3 percent above 2019 levels."

LATAM fleet
LATAM group’s fleet includes 256 Airbus narrow-body aircraft, 57 Boeing wide-body aircraft and 20 Boeing cargo freighters (Boeing 767-300F), totaling 333 aircraft. "LATAM Cargo Chile, LATAM Cargo Colombia and LATAM Cargo Brazil are the LATAM group cargo subsidiaries. In addition to having access to the bellies of the passenger affiliates' aircraft, they have a fleet of 20 freighters. They operate on the LATAM group network as well as international routes that are solely used for freighters. They offer modern infrastructure, a wide variety of services and protection options to meet all customer needs."

2024 outlook
LATAM is expecting revenue of $12.4-12.8 billion in 2024, and an adjusted EBIT of $1.25-1.50 billion.

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