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LATAM Airlines making progress in Brazil
“The company is strong; we are making solid progress - not only in Brazil, also internationally,” Cueto told reporters at the sidelines of a press conference in Santiago’s airport.
“We are confident that we are going to get back our rhythm in terms of market value, good results, and more flights that have been the tonic of LAN and now LATAM,” he said.
LATAM, the region’s biggest airline, was created last year in a tie-up between Chile’s LAN and Brazil‘s TAM. It reported a larger than expected second quarter loss due to Brazil‘s weak economy, sending its shares sharply lower.
The problems are a far cry from the record of the pre-merger LAN that was an investor darling, based on its efficiency investment grade debt.
However, many analysts believe it can still turn itself around, with 13 out of 15 brokers taking a ‘buy’ or ‘hold’ stance on its U.S.-listed depositary shares, according to Reuters estimates.
Its shares have begun to recover in recent weeks in anticipation of improved results when it reports its third quarter earnings next month.
The airline, which has cut its TAM workforce by around 4 percent in recent months, is looking to spend around $11 billion to boost its fleet.
To that end, it is making efforts to wrap up a planned $1 billion capital increase in December, Cueto said.
The hike, originally slated for September, was delayed by administrative issues, Cueto said.
He also welcomed Brazil‘s possible plans to open up its skies to foreign airlines during the World Cup next year, calling the move “interesting.”
The host of the soccer tournament will decide in December, after the draw that decides who plays where, whether it will open up domestic routes to companies that fly internationally to Brazil. (Reuters)
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