- Planetary alignment peaks with celestial show this weekend
- UK fighters escort Pakistan plane to airport, two arrests
- Arizona jury foreman says believed Jodi Arias was abused
- Judge rules against 'America's toughest sheriff' in racial profiling lawsuit
- Stockholm calmer but violence spreads outside Swedish capital |
UPDATE 1-LATAM Airlines 2012 net profit nosedives on merger, taxes
* LATAM says sees operating results in Brazil improving this year
* Airline slashes planned 2013-2015 fleet plan by $1.2 bln
* Costs from LAN's takeover of TAM, Chile tax reform weigh
SANTIAGO, March 19 (Reuters) - Newly-merged LATAM Airlines Group SA's net profit dived 96.6 percent in 2012 to $10.96 million, hammered by the cost of Chilean airline LAN's takeover of Brazil's TAM and higher taxes in Chile, the company said late on Tuesday.
Latin America's largest carrier said it saw a "significant improvement" in major market Brazil this year, however it was still slashing its planned capital expenditures for the 2013 to 2015 fleet by $1.2 billion.
"LATAM Airlines Group is in the process of adjusting its fleet plan in order to match its capacity expansion plans to the expected competitive and macroeconomic environment on international and domestic Brazil passenger markets," the company said in a statement.
"The company continues to evaluate alternatives to rationalize its fleet orders."
Fleet investment will total $2.047 billion this year, $1.993 billion next year and 806 million in 2015, LATAM added.
The carrier said the cost of its future planes would be partly financed by debt issues.
Total merger synergies should reach between $600 million and $700 million, and will be fully achieved by June 2016, LATAM said. Synergies are seen between $250 million and $300 million this year.
"We expect to continue to incur certain costs related to the integration process," LATAM added.
MERGER TAKES TOLL
LATAM was seen posting a $34.7 million net profit for all of 2012, according to a Reuters poll.
But costs associated with LAN's takeover of TAM last year, a tax overhaul in Chile and higher costs hit the airline hard.
LATAM's fourth quarter net profit was $8.5 million, excluding "special items" such as the merger cost as well as aircraft sale and redelivery costs. That compares with $114.9 million in the same period of 2011, before the merger.
The carrier has domestic operations in Argentina, Brazil, Chile, Colombia, Ecuador and Peru.
- Tweet this
- Share this
- Digg this