Brazil airline TAM's 1st-quarter net slumps 96 pct

SAO PAULO, May 12 (Reuters) - Brazil's biggest airline TAM Linhas Aereas (TAMM4.SA)(TAM.N) said late on Monday its first-quarter net profit tumbled 96 percent because of a surge in jet fuel costs and marketing expenses.

Net income fell to 2.6 million reais ($1.57 million) from 59.2 million reais in the same period in 2007, TAM said in a securities filing. Sales jumped 23.2 percent to 2.26 billion reais.

TAM said operating expenses rose 28.5 percent to 2.24 billion reais in the first quarter, led by a 48.1 percent jump in aviation fuel costs to 844.8 million reais.

Marketing and selling expenses rose 29.1 percent to 241.7 million reais, while personnel costs climbed 50.4 percent to 402.7 million reais as the airline hired more people and raised wages, also affecting the bottom line.

TAM flew 7.55 million people in the first quarter, compared with 6.66 million in the same period of 2007.

The number of passengers in domestic flights rose 9.2 percent to 6.38 million, while passengers in international flights grew 42.5 percent to 1.16 million.

The company said its share of Brazil's domestic market grew to 50 percent from 48.4 percent a year earlier. ($1=1.655 Brazilian reais)

(Reporting by Elzio Barreto, Editing by Jacqueline Wong)