The group said the decrease continues to reflect “a weak macroeconomic environment” in South America, especially in Brazil, and the devaluations of Latin American currencies during the period.
Latam reported operating income of US$1.3 million for second quarter and US$220.4 for the first half of 2016.
Operating margin reached 0.1% for the quarter, representing a slight decrease of 0.7 percentage points as compared to the second quarter 2015.
Operating margin for the first half of 2016 reached 5.0%, “in-line with guidance” and 0.3% above the same period of 2015.
As of August 2016, Latam Airlines Group has reduced fleet assets for 2017-2018 by US$1.1 billion, in line with the company’s previously announced plans to achieve a decrease of US$2.0 to US$3.0 billion in its expected fleet assets for 2018.
Latam Airlines Group said in a statement: “Over the last year we have implemented significant changes with the objective of transforming Latam into a simpler, leaner and more efficient group.
“We have made these changes amidst a challenging and volatile macroeconomic scenario in the region, and we acknowledge that results have not fully met our expectations.
“For that reason, and in order to prepare ourselves for future market challenges and opportunities, we recognise the need to become more innovative and to continue working at an accelerated pace to address the changing dynamics of customers and the industry, as well as the economic situation in South America.
“With this is mind, and as previously announced, Latam and its affiliate carriers have further advanced in the redesign of their domestic passenger business model, in order to increase competitiveness and ensure the sustainability of domestic operations in the long term.”
