LATAM
GROUP
2024
› 1
LATAM GROUP ANNUAL INTEGRATED REPORT
LATAM
GROUP
2024
› 2
INDEX
INDEX
03
PRESENTATION
07
Highlights
09
Letter from the CEO
13
WHO WE ARE
14
LATAM group
16
Purpose
17
Strategy
18
Value generation model
19
A journey through history
21
Awards and recognitions
23
OUR BUSINESS
25
Industry context
26
Financial results
28
Debt profile
29
Investment Plan
31
Stock information
32
CORPORATE GOVERNANCE
34
Ownership structure
40
Board of Directors
49
Organizational chart
50
Management Team
55
Corporate guidelines
67
Stakeholder engagement
70
Financial policies
75
OPERATIONS
77
Passenger operations
79
Cargo operations
83
Joint Venture with Delta Air Lines
84
Fleet
89
CLIENTS
91
Passenger operations
100 Cargo operations
102 Innovation
103 Technology, cybersecurity and data
protection
111 EMPLOYEES
112 Who makes up LATAM group
115 Talent management
121 Diversity and inclusion
124 COMMITMENT TO
SUSTAINABILITY
125 Sustainability strategy
132 Environmental management
140 Climate change management
151 Circular economy
159 Shared value
163 SAFETY
165 Customer safety
171 Occupational safety
177 Civil aviation and property security
181 SUPPLIERS
182 Supply chain management
186 Supplier selection and evaluation
194 Guidelines
195 Payment policies
197 ABOUT THE REPORT
198 Double materiality analysis
201 GRI and SASB content index
206 NCG N°519 content index
207 Glossary
208 External assurance
210 ANNEXES
211 Who we are
216 Corporate government
225 Our business
256 Suppliers
257 Commitment to sustainability
269 Employees
280 About the report
284 FINANCIAL REPORTS
285 Financial statements
372 Affiliates and subsidiaries
410 Financial analysis
418 Sworn statement
419 Corporate structure
› 3
LATAM
GROUP
2024
01 / PRESENTATION
01
07 HIGHLIGHTS
09 LETTER FROM THE CEO
_PRESENTATION
LATAM
GROUP
2024
01 / PRESENTATION
FOREWORD
NCG 519: 12. FINANCIAL REPORTS
GRI 2-2 AND 2-3
In this Integrated Report, LATAM Airlines Group S.A.
is presenting the main achievements and challenges
throughout 2024, considering the different areas of the
business (economic, social and environmental), as well as
the relationship with its stakeholders.
Global Corporate Sustainability Assessment (CSA)
and Ecovadis, taken annually on a voluntary basis
by the LATAM group.
It should be noted that the Consolidated Financial
Statements of LATAM Airlines Group S.A., which
include the financial position as at December
31, 2023 and 2024, are an essential part of this
Integrated Report and have been externally audited
by PricewaterhouseCoopers (PwC). These are available
on the websites of the CMF and LATAM group’s
Investor Relations, together with this Integrated
Report, as at March 2025.
The information provided covers the period from
January 1, 2024 to December 31, 2024 and complies
with the requirements of General Standard (NCG, for
its Spanish acronym) No. 519 of the Chilean Financial
Market Commission (CMF, for its Spanish acronym),
which amended NCG No. 461 and NCG No. 30, in
terms of their requirements for sustainability and
corporate governance information in annual reports.
In addition, sustainability information includes the
metrics defined by the Sustainability Accounting
Standards Board (SASB) for the transportation industry,
specifically the airline sector. It also considers the
Global Reporting Initiative (GRI), globally recognized
as a key standard for sustainability disclosure.
Likewise, it incorporates indicators from the S&P
› 4
LATAM
GROUP
2024
› 5
LATAM
GROUP
2024
01 / PRESENTATION
CONVENTIONS
Currency and Exchange Rate
LATAM Airlines Group S.A. maintains accounting
records and prepares its financial statements in US
dollars (US$). At the same time, some of its affiliates
use Chilean pesos (CLP$), Colombian pesos (COP$)
or Brazilian reals (BRL$). However, their Consolidated
Financial Statements include the results of these
affiliates converted into US$.
On the other hand, in accordance with the International
Accounting Standards (IASB), assets and liabilities
consider the exchange rate at the end of the period.
In turn, the income and expense accounts take
into account the exchange rate at the date of the
transaction; however, a monthly exchange rate may
be adopted if the rates do not vary widely.
Names
References to “LATAM”, “LATAM Airlines Group”,
the “Company” or the “parent company” are for
LATAM Airlines Group S.A., and references to “the
LATAM group”, or the “group” are for LATAM Airlines
Group S.A. and its consolidated passenger and cargo
affiliates. These are Transporte Aéreo S.A. (LATAM
Airlines Chile); LAN Airlines Perú S.A. (LATAM Airlines
Peru), Aerolane, Líneas Aéreas Nacionales del Ecuador
S.A. (LATAM Airlines Ecuador); LAN Argentina S.A.
(LATAM Airlines Argentina, formerly Aero 2000 S.A.);
Aerovías de Integración Regional, Aires S.A. (LATAM
Airlines Colombia); TAM S.A. (TAM or LATAM Airlines
Brazil); Transportes Aéreos del Mercosur S.A.(LATAM
Paraguay); and the cargo subsidiaries, which are: LAN
Cargo S.A. (LATAM Cargo) Línea Aérea Carguera de
Colombia S.A. (LANCO or LATAM Cargo Colombia);,
and Aerolinhas Brasileiras S.A. (ABSA or LATAM
Cargo Brazil).
Other references to LATAM, as the context may
require, refer to the LATAM brand, launched in 2016,
and comprises, under one internationally recognized
name, all of the affiliate brands, such as LATAM
Airlines Chile, LATAM Airlines Peru, LATAM Airlines
Argentina, LATAM Airlines Colombia, LATAM Airlines
Ecuador, and LATAM Airlines Brazil.
● Cargo Affiliates
This refers to the group of cargo operators, i.e. LAN
Cargo S.A. (LATAM Cargo), Línea Aérea Carguera de
Colombia S.A. (LANCO or LATAM Cargo Colombia)
and Aerolinhas Brasileiras S.A. (ABSA or LATAM
Cargo Brasil).
● LAN
Mentions of LAN refer to LAN Airlines S.A., currently
LATAM Airlines Group S.A. This is due to circumstances
and events occurring prior to the completion date
of the combination between LAN Airlines S.A. and
TAM S.A.
● TAM
Unless the context requires another form, mentions
of TAM refer to TAM S.A. and its consolidated
subsidiaries, including TAM Linhas Aéreas S.A. (TLA),
which operates under the name LATAM Airlines
Brazil, Fidelidade Viagens e Turismo Limited (TAM
Viagens) and Transportes Aéreos del Mercosur S.A.
(TAM Mercosur).
Independent assurance
NCG 519: 9.2 INDEPENDENT ASSURANCE
GRI 2-5
The contents and indicators associated with the
standards of the Sustainability Accounting Standards
Board (SASB), the Global Reporting Initiative (GRI),
and those suggested by the S&P Global Corporate
Sustainability Assessment (CSA) have been subjected
to external verification by PricewaterhouseCoopers
(PwC), ensuring an independent, thorough and
comprehensive evaluation.
Meanwhile, the set of information that has been
verified and the standards used for each metric are
indicated in the letters provided by the auditors,
available in chapter “About this Report”.
LATAM
GROUP
2024
Guide to reading the report
In this Integrated Report, LATAM group presents the
information corresponding to each standard used, organized
according to the labels listed below. In addition, for easier
access to information, a consolidation of metrics is included
in two content-specific indices, available in chapter “About
this Report”.
NCG 519
Contents of General Standard No. 519 (which amended
No. 461) applicable to Chilean Annual Reports.
SASB
Contents for the transportation industry, specifically
the airline sector, in the Sustainability Accounting
Standards Board (SASB).
GRI
Contents of the international standard Global Reporting
Initiative (GRI).
CSA
Suggested content from the 2024 S&P Global
Corporate Sustainability Assessment.
More information
GRI 2-3
Any suggestions, comments and/or concerns about this
Integrated Report can be submitted to the following
e-mail addresses: investorrelations@latam.com and/or
sostenibilidad@latam.com
› 6
01 / PRESENTATION
LATAM
GROUP
2024
› 7
LATAM
GROUP
2024
HIGHLIGHTS
FINANCIAL
PERFORMANCE
TOTAL REVENUE
US$13,034MILLION
+10.6% VS. 2023
ADJUSTED EBITDAR
US$3,108MILLION
+22.7% VS. 2023
NET INCOME
US$977MILLION
+67.9% VS. 2023
Financial highlights 2024
Historic financial results for LATAM group.
Return to the New York Stock Exchange
(NYSE).
Successful refinancing of a large portion
of non-fleet-related debt, totaling
US$1.4 billion at a 7.875% rate.
First sustainability-linked loan for an
airline in South America, totaling
US$300 million.
2022
2023
2024
ADJUSTED NET LEVERAGE
(Net Debt / Adjusted EBITDAR)
4.0X
2.1X
1.7X
SEE MORE
In the “Our business” chapter
LIQUIDITY
(US$ millions)
● Liquidity (Measured with the last twelve months of total revenue)
● Cash and cash equivalents
● Available revolving credit lines (RCF)
23.9%
24.3%
27.1%
2022
1,217
1,715
2023
2,317
1,815
3,533
2024
1,958
1,575
1,100
1,100
01 / PRESENTATION
LATAM
GROUP
2024
82MILLION PASSENGERS
+11.0% vs. 2023
OPERATIONS
CUSTOMERS
SUSTAINABILITY
Passenger Business
+ 15.1%
Increase in capacity (ASKs)
Cargo Business
+ 12.5%
Increase in capacity (ATKs)
347
aircraft in LATAM
group’s fleet
16AIRCRAFT
received in 2024
AROUND 5,000
people transported under the Avión Solidario
program in 2024
NEARLY 500,000
tons of CO2e managed through reduction
and offsets.
THE FOURTH MOST
PUNCTUAL AIRLINE
IN THE WORLD
(SOURCE: CIRIUM)
49MILLION
members in the LATAM Pass
loyalty program
› 8
THE MOST SUSTAINABLE
AIRLINE IN THE AMERICAS
AND THE 5TH WORLDWIDE,
ACCORDING TO THE 2024 CSA
RESULTS FROM S&P GLOBAL
51
Passenger Business
POINTS
NPS
POINTS
NPS
50
Cargo Business
NPS: Net Promoter Score
01 / PRESENTATION
LATAM
GROUP
2024
› 9
LATAM
GROUP
2024
01 / PRESENTATION
LETTER FROM THE CEO
GRI 2-22
We ended 2024 proud to have made significant
progress and achievements for LATAM group.
During the year, LATAM group achieved significant
improvements for employees, customers and the
environment in a context of solid growth, which
allowed us to generate record financial results.
LATAM group continues to offer unparalleled
connectivity, operating 163 destinations in 27
countries and having carried 82 million individuals,
which represents the largest number of passengers
transported by the group in its history. These results
were the consequence of the group having increased
its passenger operations by 15.1% compared to 2023.
The cargo business also made significant progress.
The group was able to transport 998 thousand tons,
generating a 12.3% increase in revenues compared
to the previous year. Specifically, the affiliates
showed outstanding performance on routes to and
from Europe—a segment in which they increased
their corresponding market shares. All of these
achievements were possible, thanks to the group’s
ability to rapidly adapt to changing and competitive
markets, where we seized opportunities to expand
and consolidate our operations.
At the financial level, we achieved solid financial
results. Total revenues reached US$13,034 million,
translating into a 10.6% increase compared to the
previous year. In this context, our profitability also
showed significant improvements. Our adjusted
EBITDAR was US$3,108 million, exceeding our
guidance published at the beginning of the year.
During the year (2024), LATAM
group made significant achievements
for employees, customers and the
environment, in a context of solid
growth, which allowed us to generate
record financial results.
During the year, we also met LATAM Airlines Group
S.A.’s important objective of returning to trade on the
New York Stock Exchange (NYSE) and resuming the
American Depositary Receipts (ADRs) program. On
October 22, we held our Bell Ringing Ceremony—a
milestone that marked our long-awaited return to
the world’s leading stock market. On that same
day, we held our first Investor Day in New York,
which focused on LATAM group’s value proposition
in the region and our plan to drive sustained and
profitable growth. In turn, in December, the first ever
Sustainability-Linked Loan was arranged, for a total
of US$300 million, becoming the only airline in South
America to have carried out a financial transaction
of this type to date.
› 10
LATAM
GROUP
2024
01 / PRESENTATION
Just, empathetic, transparent and
straightforward(JETS)
Aligned with our principle of being Just, Empathetic,
Transparent and Straightforward (JETS), we have
continued to strengthen our relationship with our
employees and customers, and 2024 confirms this
as a year of good results. In the case of the group’s
employees, the Organizational Health Index (OHI),
which measures internal employee satisfaction,
reached 79 points—the highest level recorded since
we began measuring it, in 2012—reflecting the
commitment and dedication of the group’s nearly
39,000 workers.
On the other hand, our efforts and focus on improving
our customers’ experience also show important
advances. For the fifth consecutive year, LATAM
group was one of the five most punctual airlines in
the world. This achievement, together with multiple
changes and improvements in operational and
customer service processes, allowed us to reach a
Net Promoter Score (NPS) of 51 points in 2024—3
points higher, compared to 2023.
The improvement in passenger satisfaction was
complemented by a decrease in the complaint
rate. In Chile, LATAM reduced the rate by 21.8%
compared to 2023 and has had a 70% reduction in
complaints over the last five years, according to the
report prepared by the Civil Aeronautics Board (JAC,
for its Spanish acronym) based on figures from the
National Consumer Service (SERNAC, for its Spanish
acronym).
LATAM Airlines Colombia also lowered its complaints
rate. In the case of the Superintendence of
Transportation, 1,103 claims were filed—down 11%
from 2023—which corresponds to 0.01% of the total
passengers carried by the airline in 2024. On the SIC
Facilita platform of the Superintendency of Industry
and Commerce, 51% fewer complaints were filed
compared to 2023.
On the other hand, LATAM Airlines Brazil was chosen
as the airline with the “Best Service in Brazil”,
according to the Reclame Aqui portal. This recognition
is considered one of the most relevant in terms of
service and reputation in Brazil and is the result of
a series of investments made for passengers.
To improve our customers’ travel experience, the
aircraft renovation process continued last year with
a full overhaul of the cabin interiors with new seats,
in-flight entertainment and design improvements.
At yearend, 100% of the group’s narrow-body
fleet and 54% of its wide-body fleet had been
overhauled. In turn, the group also made progress
in the implementation of free Wi-Fi for LATAM Pass
customers on domestic and regional flights in the
narrow-body fleet—a service that covers 100% of the
fleet in the Brazilian affiliate and 75% in the Chilean,
Peruvian, Colombian and Ecuadorian affiliates.
Aligned with our principle of being
Just, Empathetic, Transparent and
Simple (JETS), we have continued
to strengthen our relations with our
employees and customers, and 2024
confirms this as a year of good results
Last, with regard to LATAM Pass, the loyalty program,
already has 49 million members globally—the seventh
largest in the world. At the same time, important
changes to the program were announced during 2024
(effective as of 2025) to provide more options for
earning and redeeming points and miles, making it
more appealing to frequent flyers.
Commitment to Sustainability
Last year was a key year for reaffirming the
group’s commitment to sustainability. In addition
to achieving significant results with regards to the
group’s roadmap, the strategy continued to be
strengthened, incorporating recent scientific evidence
and considering the outcome of regulatory definitions
and public policies, to ensure that it remains up to
date and addresses the current challenges of the
industry and the environment.
Among the outstanding results, the environmental
management system implemented in LATAM group’s
operations was recertified as IENVA stage II—the
highest level of the IATA environmental assessment
program—and also integrated the energy management
system for operations in Chile. In climate change
management, through new technologies and continuous
improvement in operations focused on fuel savings
and efficient use LATAM group achieved a reduction
of more than 98 thousand tons of CO2e in 2024,
in addition to nearly 400 thousand tons of CO2e
emissions offset through the conservation of more
than 278,903 hectares of savannah floodplains and
forests in the Colombian Orinoco region.
On the other hand, in the circular economy pillar,
initiatives to eliminate single-use plastic continue to
be strengthened. Thanks to this, a 97% elimination
rate was achieved in the group’s operations in 2024.
Moreover, with the goal of becoming a zero-waste-
to-landfill group, we managed to divert 57% of the
waste managed out of the 5,174 tons per year that
are now part of LATAM group’s waste management
system.
Last, within the framework of the Avión Solidario
program, in addition to working with 47 organizations
across the region to improve access to healthcare and
environmental conservation, we continue to make
ourselves available to collaborate in transporting
humanitarian aid in emergency situations. A prime
example was the response during the 2024 floods in
Brazil, where we mobilized resources to assist both
› 11
LATAM
GROUP
2024
the affected communities and the Brazilian affiliate’s
employees, and where nearly 200 tons of supplies
and basic care items were transported.
Thanks to the work done and to
LATAM’s outstanding performance
in the S&P Global Corporate
Sustainability Assessment (CSA),
LATAM Airlines Group S.A. returned
to the prestigious Dow Jones
Sustainability Indexes (DJSI) in
2024, positioning itself as the most
sustainable airline in the Americas and
the fifth most sustainable worldwide.
All of this would have been impossible without the
tireless commitment of all our employees, who met
every challenge with resilience and a common sense
of purpose. Their efforts are undoubtedly the basis
of our solid results.
To our shareholders, I also wish to express our
gratitude for their trust and support. Together, we
are building a stronger LATAM group, increasingly
connected to its customers, its employees and its
environment.
We are aware of the challenges we face, but also of
the opportunities that lie ahead. Therefore, every step
is geared towards growth in the different markets,
improving operations and generating shareholder
value.
Undoubtedly, the future poses significant challenges,
but at the same time, it is promising. I have no
doubt that, with your support, the LATAM group will
continue to soar to new heights. Let us continue to
work together to turn opportunities into tangible
successes and remain a benchmark of excellence in
the airline industry.
ROBERTO ALVO
CEO OF LATAM AIRLINES GROUP S.A.
01 / PRESENTATION
RETURN TO
THE NEW
YORK STOCK
EXCHANGE
On October 22, 2024, LATAM Airlines
Group S.A. rang the market opening bell
on the New York Stock Exchange (NYSE),
marking a new chapter in its history and
reaffirming its commitment to both growth
and consolidation in the global airline
industry.
› 12
01 / PRESENTATION
LATAM
GROUP
2024
› 13
LATAM
GROUP
2024
02 / WHO WE ARE
02
_WHO WE ARE
14 LATAM GROUP
16 PURPOSE
17 STRATEGY
18 VALUE GENERATION MODEL
19 A JOURNEY THROUGH HISTORY
21 AWARDS AND RECOGNITIONS
› 14
LATAM
GROUP
2024
02 / WHO WE ARE
18
CENTRAL AND NORTH
AMERICA
1
AFRICA
10
EUROPE
3 OCEANIA
163
Destinations
12 exclusively for cargo
31
Countries, total
4 exclusively for cargo
LATAM GROUP
NCG 519: 6.1.I INDUSTRIAL SECTOR AND 6.2.I BUSINESSES
GRI 2-1, 2-6 AND 3-3
LATAM group has domestic operations in five
countries: Brazil, Chile, Colombia, Ecuador and Peru.
Likewise, it connects the Americas, Europe, Africa
and Oceanía through an extensive network.
Passenger agreements
with 57 airlines
Commercial passenger
agreements with 55
airlines
Passenger code share
agreements with 30
airlines
BRASIL
PERÚ
CHILE
Santiago
Lima
Sao Paulo
ECUADOR
COLOMBIA
SOUTH
AMERICA
131
› 15
LATAM
GROUP
2024
02 / WHO WE ARE
MAIN BUSINESSES OF
LATAM GROUP
NCG 6.1.I “INDUSTRIAL SECTOR” AND “BUSINESSES”
LATAM Airlines is the passenger business of LATAM and its affiliates; together, they
are the largest group of airlines in South America and one of the largest in the world1.
With a global network spanning more than 150 destinations across four continents,
it is the leader in the regional market, with more than twice the share of its closest
competitor. Its fleet of 326 aircraft, including 58 wide-body, connects millions of
passengers from, to and within Latin America, providing a unique travel experience.
LATAM Cargo is LATAM group’s cargo unit, whose main purpose is to offer air freight
transportation solutions to, from, and within Latin America. As the largest air cargo
carrier in the region, it has a network of 163 destinations (12 cargo-only). It has a
fleet of 21 freighter aircraft, together with the capacity in the holds of passenger
flights, creating synergies between both businesses and allowing for a flexible and
efficient operation.
LATAM Pass is LATAM group’s loyalty program and the largest in South America, with
more than 49 million members. Recognized as the leading frequent flyer program
in the region, LATAM Pass allows members to earn miles on flights, purchases and
services, which can then be redeemed for tickets, upgrades and exclusive experiences.
1 In terms of capacity measured in ASK (Acronym for “Available seats-kilometer”).
› 16
LATAM
GROUP
2024
PURPOSE
ELEVATE
EVERY
SINGLE
JOURNEY.
NCG 519: 2.1. MISSION, VISION, PURPOSE AND VALUES
To connect Latin America to itself and to the
world through a broad passenger and cargo
transportation network, operating with safety
and customer service, and maintaining a
balance between economic growth, efficiency,
environmental care and social well-being.
To be the leading airline group in Latin
America, recognized for its commitment to
social responsibility and its focus on being fair,
empathetic, transparent and straightforward
(JETS, for its Spanish acronym) in its interactions
with employees, customers and other key
stakeholders.
MISSION
VISION
VALUES
SAFETY
To ensure, at all
times, the safety of
both employees and
customers.
BE CARING
To genuinely care
about people’s needs
and offer a fair,
empathic, transparent
and straightforward
experience (JETS, for its
Spanish acronym).
SUSTAINABILITY
To continually seek
balance between
economic growth,
efficiency, environmental
care and social well-being
for a more sustainable
future.
For a decade, LATAM group’s purpose was to “Take clients’ dreams to their
destinations.” Meanwhile, during 2024, after a process of deep reflection and
review, LATAM group overhauled its organizational purpose, focusing on something
more profound and connected to the experiences it provides.
This new purpose reflects that the LATAM group is not only focused on transporting
people and cargo, but also on providing a complete experience at all times.
Moreover, it encompasses various stakeholders, including employees, customers,
and the environment, among others.
02 / WHO WE ARE
LATAM
GROUP
2024
01
02
03
STRATEGY
NCG 519: 4.2 STRATEGIC OBJECTIVES
UNIQUE PRODUCT AND CONNECTIVITY
To offer the best range of destinations to, from and within Latin America,
providing an attractive frequent flyer program and alternatives that cover
passengers’ various reasons for travel. In addition, to offer an excellent freight
service, optimizing the assets deployed throughout the continent and across
the world.
Unique network
Diversified product
Strategic agreements
CUSTOMER EXPERIENCE AS A FOCAL POINT
To offer a customer-centric service, guaranteeing reliability, operational
safety and generating loyalty through the LATAM Pass program, increasing
the benefits for passengers.
Comprehensive and personalized experience
Investments in technology
Reliability
CULTURE OF COMMITTED INDIVIDUALS
To maximize employee motivation and commitment to offer a close, cheerful
and caring service, capitalizing on their passion and dedication to offer constant
care to both passengers and cargo customers
Development culture
Diversity and Inclusion (D&I)
Efficiency in talent management
To be a dedicated airline group focused on
providing the best solution to its customers
Annually, LATAM group undertakes an annual cross-cutting
strategic planning process to review and/or establish strategic
objectives for both the medium and long term, which are currently
provided below:
To be a financially sound and healthy
airline group
OPERATIONAL EXCELLENCE
To continue to offer a frictionless and safe operation for employees, as
well as passengers and cargo customers alike.
Safety
On-time performance
Proactive risk management
Good relationships with suppliers
EFFICIENT PERFORMANCE AND AN OPTIMAL CAPITAL
STRUCTURE
To maintain a solid capital structure that will ensure long-term sustainability
through a robust financial structure, efficient operations, and sustainable
growth.
Operating efficiency
Sound financial indicators
To be an airline group that takes on
the challenges of the future
SOCIAL AND SUSTAINABLE ASSET
To become a key player in promoting social, environmental and economic
development in the countries where it operates. In addition, to work to
contribute to the well-being of communities and environments, through
partnerships and the establishment of long-term connections with the
various stakeholders.
Sustainability Strategy
DIGITAL INTEGRATION
To transform the way we work to leverage digital integration, achieving
greater daily efficiency.
Continuous innovation
Security and data protection
Cybersecurity
› 17
GRUPO
LATAM
2024
02 / WHO WE ARE
› 18
LATAM
GROUP
2024
Governance
and
Management
— Ethics
— Financial responsibility
— Safety and efficiency
— Developing employees
Sustainability — Environmental management
— Climate Change
— Circular Economy
— Shared Value
Customer
orientation
— Digital experience and
innovation
— Flexible sales model
— Trade agreements and
partnerships
— Loyalty programs
01
INPUTS
02
ACTIVITIES
LATAM group transforms these inputs
into results and impacts through its
activities.
What we do and how we do it.
04
— Financial results
— Operational
excellence
— Broad destination
network
— Customer base
diversity
— Organizational
health and
development
opportunities
IMPACTS
LATAM group’s added value lies in its
capacity to generate lasting positive impacts
for the business and its stakeholders.
Customer-centric value
proposition
For LATAM
Different customer profiles and
segments, as well as revenue
diversification.
For stakeholders
Offering adjusted to different
needs and expectations, as well
as autonomy and freedom of
choice.
Connectivity
Market share in
the region
— Mobility and economic
momentum.
Safety
Reliability
— Natural resource economy,
and less environmental and
noise impact.
Eco-efficience
Strategic
dialog
Commitment to
the region
Knowledge sharing,
industry development and
compliance
Competitive edge and
cost reduction
— Confidence
— Joint construction and
topics of interest of the
various audiences
To be a relevant player in
society, and to have an
identity and purpose
— Economic development,
social strengthening and
environmental care
VALUE GENERATION MODEL
LATAM group uses capital of various natures
(human, financial, natural, intellectual, social and
relational, and industrial) that serve as inputs to
carry out its own business.
03
RESULTS
Materialization of the work:
The results are the most visible
dimensions of the operation.
Human
Capital
Employees
Financial
Capital
Jet Fuel
— Revenues
— Capital
— Assets
Natural
Capital
Intellectual
Capital
— Fleet
— Maintenance
Bases
— Hangars
Industrial
Capital
Knowledge of the region
and the business
Operating licenses and
slot rights at airports
Management Systems
(environmental and
security)
Analytics (customizing the
customer experience)
— Frequent Flyer
Programs
— LATAM brand
— Relations with
authorities and
industry
— “Avión Solidario”
program
Social and
Relational
Capital
—
—
—
—
—
—
—
—
—
—
—
GRUPO
LATAM
2024
02 / WHO WE ARE
› 19
LATAM
GROUP
2024
02 / WHO WE ARE
A JOURNEY THROUGH HISTORY
NCG 519: 2.2 HISTORICAL INFORMATION
1947
LAN made its
first international
flight to Buenos
Aires (Argentina),
and later, in 1958,
began operations
in Miami (United
States).
1929
Establishment
of LAN Línea
Aérea Nacional
de Chile (LAN)
by Commander
Arturo Merino
Benitez.
Creation of Taxi
Aéreo Marília (TAM),
by five charter flight
pilots.
1961
1970
LAN begins to
offer flights to
Europe.
1985
After its
establishment
through CORFO,
LAN is transformed
into a corporation
(LAN Chile).
Establishment of
TAM Transportes
Aéreos Regionais
by Captain Rolim
Adolfo Amaro.
1975
Opening of the cargo
terminal in Miami
(United States).
Likewise, TAM opens
the Technology
Center and Service
Academy in São
Paulo (Brazil).
2001
TAM is listed
on the New
York Stock
Exchange(YSE).
2006
Start of cargo operations
in Colombia and
passenger operations
in the domestic market
by LATAM Airlines
Ecuador, in Ecuador. In
addition, TAM launches
the “Multiplus” miles
program.
2009
Brasil Central is
renamed TAM
(Transportes Aéreos
Meridionais).
1990
TAM buys airline
Lapsa from the
Paraguayan
government and
creates TAM
Mercosur, opening
the São Paulo
(Brazil) - Asunción
(Paraguay) route.
1996
Following the signing of a
binding agreement between
LAN Airlines and TAM in
2011, LATAM Airlines Group
S.A. was created. After this
milestone, 2.9 million shares
were issued.
2012
LATAM group’s history began 95 years ago in Chile, where it grew to
become the leading airline group in Latin America. The following is a
summary of the most important milestones in its history.
TAM acquires VOTEC
(Brasil Central
Linhas Aéreas),
another regional
airline operating in
the northern and
central sectors of
Brazil.
1986
1997
LAN Chile publicly
lists its shares
on the New York
Stock Exchange
(NYSE), becoming
the first Latin
American airline
to trade American
Depositary Receipts
(ADRs).
2000
LAN Chile joins
oneworld®, an
alliance of fourteen
commercial airlines.
2003
LAN Chile’s
expansion process
continues: start of
LAN Ecuador.
2004
Corporate Image
Change: LAN Chile
becomes LAN
Airlines, which
launches the new
business class for
flights to Paris
(France) and Miami
(United States).
Meanwhile, TAM
begins to fly to
Santiago (Chile).
2005
LAN Airlines makes progress
on its regional expansion with
the launch of LAN Argentina,
while TAM is listed on the
São Paulo Stock Exchange
(Bovespa) and announces
flights to Buenos Aires and
New York.
2007
LAN Airlines
receives a capital
increase of
US$320 million
and implements
the low-cost
model in domestic
markets.
2010
LAN Airlines acquires
Colombian airline Aires
and TAM officially joins
Star Alliance, the airline
alliance founded in 1997.
1999
LAN Chile’s
expansion process
begins: start of LAN
Peru.
1994
The privatization
of LAN Chile is
completed with the
acquisition of 98.7%
of the company by
private shareholders.
› 20
LATAM
GROUP
2024
02 / WHO WE ARE
2013
LATAM Airlines
Group S.A.
carries out a
capital increase of
US$940.5 million.
2014
TAM joins
oneworld®, making
oneworld® the
global alliance for
LATAM group.
Capital increase of
US$608 million,
with which Qatar
Airways acquires
9.999999918% of
LATAM group’s total
subscribed and paid-in
shares.
2016
Launch of LATAM group’s new
Sustainability Strategy and
release of the group’s five-year
business plan (2022-2027),
as well as of its reorganization
plan under Chapter 11 of the
US Bankruptcy Act.
2021
LATAM group completed the
transformation process of its narrow-
body fleet, implementing the latest cabin
standards to serve different customer
segments. In addition, it reduced single-
use plastics by 97%, equivalent to 1,700
tons. Furthermore, the joint venture with
Delta Air Lines was expanded to include
the Ecuador and cargo affiliates.
2023
2019
Announcement of a strategic
agreement with Delta Air Lines
to provide more and better
options to passengers through
a complementary network of
connections between Latin
America and North America. In
turn, LATAM group announces
its exit from the oneworld®
alliance as of May 1, 2020, to
begin offering miles/benefits
with airlines with which it has
some type of partnership.
2020
Due to the reduction in
operations as a result of the
COVID-19 pandemic, LATAM
group enters the financial
reorganization process
under Chapter 11 of the US
Bankruptcy Act and obtains
access to up to USD$2.45
billion in debtor-in-possession
(DIP) financing. Moreover, the
E-Business unit launched,
with the aim of improving the
digital customer experience.
In addition, initiatives are
developed to support the fight
against COVID-19 in South
America.
2022
LATAM group successfully exit
Chapter 11 of the US Bankruptcy
Act. On the other hand, the joint
venture with Delta Air Lines,
which applies to the markets of
Brazil, Canada, Chile, Colombia,
the United States, Paraguay,
Peru and Uruguay, is made
official.
2024
LATAM Airlines Group S.A. Implemented
the reopening and re-listing of its
American Depositary Shares (ADRs)
program on the New York Stock Exchange
(NYSE), following a US$456 million
secondary offering.
In addition, it refinanced part of its non-
fleet debt, lowering the interest rate to
7.785%.
LATAM
GROUP
2024
02 / WHO WE ARE
AWARDS AND
RECOGNITIONS
⚫ WORLD AIRLINE AWARDS | SKYTRAX
LATAM group was awarded “Best Airline in South
America” for the fifth time, and “Best Airline Staff
in South America” for the third consecutive year
at the World Airline Awards 2024, known as the
“Oscars of the aviation industry”. In addition, it won
other outstanding awards, such as “Best Economy
Class in South America 2024”; “Best Business Class
in South America 2024”; “Best In-Flight Business
Class Catering Service in South America 2024”; “Best
In-Flight Economy Class Catering Service in South
America 2024”; “Best Cabin Crew in South America
2024”; and “Best Business Class Lounge in South
America 2024”.
⚫ APEX
For the third consecutive year, APEX awarded LATAM
group the prestigious “Five Star Global Airline” and
“Best In-flight Food and Beverage Service” awards in
2024. It was also recognized as the “South American
Airline with the Best In-flight Entertainment”. These
achievements were possible thanks to the comments
and evaluations of more than one million passengers
from 600 airlines, collected through Concur®’s
TripIt®, the world’s top-rated travel management
application.
GRUPO
LATAM
2024
› 21
LATAM
GROUP
2024
02 / WHO WE ARE
› 22
⚫ WORLD TRAVEL AWARDS (WTA)
The continuous cabin overhauls, the integration of
technology at every stage of the travel experience,
and the new gastronomic proposal were some of the
features that led passengers to choose LATAM group
as the “Leading Airline of South America 2024” and
the “Leading Airline Brand of South America 2024”
at the World Travel Awards, the competition known
as the “Oscars of the travel industry”.
⚫ ONBOARD HOSPITALITY AWARDS
For the second consecutive year, LATAM group was
recognized in the Sustainability category of the
Onboard Hospitality Awards 2024, thanks to the
implementation of its “Recycle Your Trip” program in
the Brazilian domestic market. In addition, it received
the “Highly Recommended” airline acknowledgement
in the “Best In-flight Entertainment” and “Catering
Innovation of the Year” categories.
⚫ PAX INTERNATIONAL AWARDS
For the fifth consecutive year, LATAM group received
the award for “Outstanding Food Service by a Carrier
in South America 2024” at the Pax International
Awards.
⚫ BUSINESS TRAVEL AWARDS
LATAM group took third place (bronze medal) in the
Cellars in the Sky 2024 category, an international
ranking that evaluates the best wines offered in
the premium cabins of airlines around the world,
standing out with the La Piu Belle red wine from
the VIK winery, served in Business Class.
⚫ AIR CARGO NEWS AWARDS
Through LATAM Cargo, LATAM group was recognized
at the Air Cargo News Awards 2024 in the Environment
category, thanks to its CO2 emissions compensation
program, “1+1: Offset to Conserve”, which invites its
cargo clients to collaboratively offset the emissions
of their shipments.
⚫ FREIGHTWEEK SUSTAINABILITY AWARDS
Through LATAM Cargo Chile, LATAM group was chosen
as the cargo airline with the best sustainability
practices in the Americas by Freightweek, one of
the leading global air cargo and logistics industry
carriers, in its 2024 edition of the Sustainability
Awards.
⚫ FREQUENT TRAVELER AWARDS (FTA)
For the second consecutive year, LATAM group’s
frequent flyer program (LATAM Pass) was recognized
at the Frequent Traveler Awards (FTA) 2024 as the
“Airline Loyalty Program of the Year in the Americas”
among 300 loyalty programs. In addition, for the
first time, LATAM Pass was warded for the “Best
Earning and Redemption Capability”.
⚫ MERCO CHILE
In 2024, Merco Chile ranked LATAM group in fourth
place among the top five organizations with the best
reputation in the country. Likewise, it was recognized
as the second best company in the Merco Talento
Chile 2024 ranking, thanks to its outstanding ability
to attract and retain talent.
⚫ MEMBERS OF THE DOW JONES BEST-IN-CLASS MILA PACIFIC
ALLIANCE & CHILE 20241
In 2024, LATAM Airlines Group S.A. returned to the prestigious Dow Jones Best-in-
Class Indexes thanks to its outstanding performance in the S&P Global Corporate
Sustainability Assessment (CSA). With a score of 67 out of 100 (+3 points compared
to 2023), and a 93rd percentile (+3 vs. 2023), it ranked fifth worldwide and first in
the Americas in the airline industry.
In addition, after five years of absence due to the reorganization process, LATAM
Airlines Group S.A. was again listed in Dow Jones Best-in-Class MILA and Dow
Jones Best-in-Class Chile. Nonetheless, during those years, it maintained its
voluntary participation in the evaluation, integrating the CSA as a key management,
measurement and benchmarking tool.
These indices annually select the companies with the best environmental, social
and governance (ESG) performance in their sector, evaluated by S&P Global under
cross-cutting and industry-specific sustainability criteria.
⚫ S&P GLOBAL SUSTAINABILITY YEARBOOK
LATAM group was also spotlighted in S&P Global’s Sustainability Yearbook 2024,
the prestigious publication that annually highlights sustainability leaders, based on
their performance in the CSA.
1 Figure updated based on information from the S&P Global CSA website as at December 31, 2024.
GRUPO
LATAM
2024
› 23
LATAM
GROUP
2024
03 / OUR BUSINESS
03
_OUR BUSINESS
25 INDUSTRY CONTEXT
26 FINANCIAL RESULTS
28 DEBT PROFILE
29 INVESTMENT PLAN
31 STOCK INFORMATION
LATAM
GROUP
2024
03 / OUR BUSINESS
LATAM GROUP’S STRENGTHS
HUB STRATEGY AND CONSOLIDATED
PRESENCE IN SOUTH AMERICA
LATAM group has an expansive network and operations
and flexibility in the management of its fleet, which
enables it to redeploy aircraft among different
geographies and take advantage of opportunities in
an agile manner.
Santiago (Chile)
Lima (Peru)
São Paulo (Brazil)
SUPERIOR PRODUCT
LATAM group provides
premium product quality while
maintaining cost efficiency.
LATAM group offers its customers
an unparalleled range of options.
LATAM group stands out for having
one of the most reliable operations in
the aviation industry.
REVENUE DIVERSIFICATION
1 Acronym meaning “Spanish-speaking countries” and referring to Chile, Colombia, Ecuador and Peru.
2 Including revenues in dollars, euros, and currencies pegged or indexed to the U.S. dollar. Additionally, it considers
revenue with rates indexed or denominated in U.S. dollars, euros, and currencies pegged or indexed to the U.S. dollar.
86%
Passenger operations
Passenger operations
by segment
12%
Cargo
operations
2%
Others
By business
(% of LATAM
group’s revenues)
33%
Domestic (Brazil)
19%
Domestic (SSC1)
48%
International
62%
Non-local
currencies2
38%
Local
currencies
By currency
› 24
› 25
LATAM
GROUP
2024
03 / OUR BUSINESS
INDUSTRY CONTEXT
NCG 519: 6.2.viii BUSINESSES
In 2024, the aviation industry in the Americas
experienced sustained growth in air traffic, driven
by the consolidation of domestic and international
routes. The region stood out for its dynamism, with
an increase in the number of domestic flights and
the expansion of international connections, especially
in Latin America, for which the International Air
Transport Association (IATA) estimated that passenger
traffic, which is measured in RPK (revenue passenger
kilometers), increased 8.5% vs. 2023.
As for passenger behavior, there was a preference
for premium services rather than low-cost options.
This was revealed in a report by consulting firm
Deloitte, entitled “A World in Motion,” which added
that, in the post-pandemic period, new trends have
emerged and existing ones have accelerated. Among
others, these include the growing influence of social
media on travelers’ decisions, the demand for flexible
booking policies that include payment options when
planning a trip, and a growing trend toward travel
that combines work and leisure.
OPPORTUNITIES
During 2024, several strategic opportunities arose
within the aviation industry. Firstly, the strengthening
of connectivity between key markets in Latin America
and the rest of the world, which enabled a significant
expansion of international routes.
In addition, fuel prices began to follow a downward
trend, which is relevant as fuel is the largest component
of the costs for airlines, accounting for 30% of the
total, according to the International Air Transport
Association (IATA).
On the other hand, worldwide, airlines took advantage
of trends toward digitization and service customization,
which enabled them to strengthen their presence
in the growing premium market and adapt more
effectively to travelers’ changing needs.
CHALLENGES
Despite the above, the aviation industry faced several
key challenges in 2024 that impacted its overall
performance. These included macroeconomic factors,
such as currency depreciation, especially in emerging
and developing economies, as in the case of Latin
America, according to the International Monetary
Fund (IMF). This situation increased operating costs
and reduced purchasing power.
Moreover, the International Air Transport Association
(IATA) noted that limitations in airport infrastructure
in several countries caused bottlenecks and affected
operating efficiency. Another significant challenge
was the shortage of aircraft as a result of disruptions
in global supply chains, which have limited airlines’
ability to expand their fleets to meet the growing
demand.
In turn, issues related to Environmental, Social and
Governance (ESG) criteria put increasing regulatory
pressures on airlines, as well as creating the need
to move towards more sustainable operations, in
an environment of higher stakeholder expectations.
EXPECTATIONS
Industry forecasts for 2025 are optimistic, with 8%
growth expected in air traffic for Latin America,
according to the International Air Transport Association
(IATA). At the same time, the cargo sector will
continue to expand, driven by the consolidation of
e-commerce and the growing demand for more agile
logistics solutions.
On the other hand, accelerated adoption of new
technologies to optimize the efficiency and sustainability
of air operations, as well as the modernization of
fleets with more efficient aircraft, are expected.
Furthermore, the focus on premium services will
continue, aligned with passengers’ growing preference
for a more personalized, high-quality travel experience.
+8% in 2025
in air traffic for Latin America, according
to IATA estimates.
LATAM
GROUP
2024
03 / OUR BUSINESS
Adjusted EBITDAR (US$ million)
2022
1,314
2023
2,533
2024
3,108
Adjusted EBITDAR margin
2022
13.8%
2023
21.5%
2024
23.8%
Passenger CASK ex fuel (US$ cents)
2022
4.3
2023
4.3
2024
4.2
Adjusted net leverage
2022
4.0x
2023
2.1x
2024
1.7x
Total revenues
US$13,034 Mn. +10.6% vs. 2023
This increase was largely due to a 10.0% increase in passenger revenues,
in addition to a 12.2% rise in cargo revenues, supported by 15.1% growth
in operations for the year.
Passenger CASK ex-fuel
US$4.2 cents (1.2%) vs. 2023
Remaining within the guidance range and once again reflecting the group’s
ability to effectively contain its cost base and maintain its operating
efficiency.
Adjusted operating income
US$1,660 Mn. +25.0% vs. 2023
This translated into an adjusted operating margin of 12.7%, an increase
of 1.5 pps over 2023, above guidance—a record annual figure for LATAM
Airlines Group.
Net income1
US$977 Mn +67.9% vs. 2023
Sound net income reflecting stability and profitability down through
the bottom line.
Liquidity
27.1% +1.2 pps vs. 2023
Efforts were made to raise liquidity through an increase and extension
of available revolving credit lines and US$243 million in cash generation.
FINANCIAL RESULTS
1 This corresponds to the net income attributable to owners of the parent company that serves as the basis for calculating the dividend distribution.
› 26
LATAM
GROUP
2024
03 / OUR BUSINESS
HISTORICAL FINANCIAL INDICATORS
(US$ THOUSAND)
2021
2022
2023
2024
Operating revenues
5,111,346
9,516,807
11,789,182
13,033,712
Adjusted operating costs
-6,230,630
-9,381,941
-10,461,281
-11,373,490
Adjusted operating income
-964,284
134,866
1,327,894
1,660,222
Adjusted operating margin
-18.9%
1.4%
11.3%
12.7%
Net income1
-4,653,142
-340,724
581,550
976,972
Net Margin
N/S
-3.6%
4.9%
7.5%
Adjusted EBITDAR
201,110
1,314,379
2,533,274
3,107,878
EBITDAR margin
3.9%
13.8%
21.5%
23.8%
Liquidity as a % of revenues2
20.5%
24.3%
23.9%
27.1%
Adjusted Net Leverage3
N/S
4.0x
2.1x
1.7x
ECONOMIC VALUE GENERATED AND DISTRIBUTED4
(US$ THOUSAND)
2024
GRI 201-1
a) Direct economic value generated (income, financial investments, sale of assets)
13,176,123
b) Economic value distributed
12,491,769
Operating Costs
9,561,518
Employee salaries and benefits
1,738,474
Payment to capital providers (interest payment to lenders and dividend distribution)
1,175,042
Payments to government (taxes)
16,489
Community investments
246
b) Retained economic value (a-b)
684,354
N/S Not significant.
1 Net profit attributable to the owners of the parent company. For the full
year 2022, excluding the positive accounting impact of U$1.68 billion on
net income related to the exit from Chapter 11.
2 Liquidity calculated as cash and cash equivalents and revolving credit
facility lines for US$1.575 million divided by Last Twelve Months revenues.
3 Adjusted net debt/Adjusted EBITDAR (last 12 months).
4 This indicator provides an overview of how an organization generates
value for its stakeholders.
More information:
Risk Factors (page 238)
› 27
› 28
LATAM
GROUP
2024
03 / OUR BUSINESS
As part of its efficient capital allocation guidance
and efforts to reduce its financial expense, LATAM
Airlines Group S.A. successfully refinanced both
its US$450 million bond maturing in 2027 and its
US$1,081 million Term Loan B, also maturing in 2027,
which were part of the Chapter 11 Exit Financing.
Gross Debt Distribution
62%
Fleet debt
19%
Senior secured notes
due 2030
10%
Senior secured notes due
2029
4%
Credit line for replacement
engines (SEF)
5%
Other debt
Total debt
US$7.150Mn
2028
2026
2025
2029
2027
2030
This refinancing enables LATAM Airlines Group S.A. to
reduce its cost of debt by securing a significantly lower
interest rate, which translated into annual savings from
lower interest payments of approximately US$120
million and a one-time impact on the company’s
Income Statement of approximately US$134 million,
US$45 million of which was a cash impact during
Non-fleet amortization profile
US$ MILLION
1,400
700
275
the fourth quarter of 2024. In addition, by using
US$207 million from cash at hand, LATAM Airlines
Group S.A. has reduced its non-fleet debt levels.
LATAM Airlines Group S.A. does not face refinancing
risks in the short term. The nearest principal maturities
are scheduled for 2029 and 2030.
DEBT PROFILE
It is important to mention that the 2029 notes
are callable in October 2025, and LATAM Airlines
Group S.A.’s objective is to continue working to
reduce interest rates.
› 29
LATAM
GROUP
2024
03 / OUR BUSINESS
INVESTMENT PLAN
NCG 519: 4.3 INVESTMENT PLANS
TOTAL CAPITAL EXPENDITURES NET OF
FINANCING
Total Capital Expenditure Net of Financing is
defined as the total capital expenditure incurred
by the company for the acquisition, maintenance,
or improvement of strategic assets, net of any third
party financing specifically used for these purposes.
This metric serves as a direct reflection of the cash
outflows committed to these activities.
This is calculated as the sum of maintenance CapEx
and CapEx for growth and fleet net of financing. The
definition of each line is as follows:
Maintenance CapEx
Primarily includes engine shop visits, aircraft C-checks,
and restocking of parts for existing operations, as
well as CapEx associated with fleet projects that
do not contribute additional capacity to the group’s
operations or add new features to the existing offered
product.
CapEx for growth and fleet net of financing
Includes CapEx associated with additional spare parts
and engines, engine shop visits, aircraft C-checks,
and restocking of parts for additional operations,
pre-delivery payments (PDPs), fleet projects that
contribute additional capacity or new features to the
existing offered product, and certain other strategic
projects that add value, and fleet arrivals, net of
their associated financing.
The division between Maintenance CapEx and CapEx
for growth & Fleet is calculated internally based on
the company’s different strategic investments. This
division is not publicly available.
LATAM Airlines Group’s total capital expenditures net
of financing can be reconciled through the following
lines: Purchase of Property, Plant and Equipment,
Purchases of Intangible Assets, leased maintenance
capitalizations, along with the net impact of financing
and other accounts. The reconciliation of this metric
can be found in the quarterly Earnings Release
publication.
The company provides a quarterly update of this
metric through its earnings release, in the adjusted
free cash flow section of the document.
Historical capital expenditures AS OF DECEMBER 31, 2024
US$ MILLION
2022
2023
2024
Maintenance CapEx
-779
-703
-639
Growth CapEx and Fleet CapEx Net of Financing1
-237
-467
-901
Total CapEx net of financing
-1,015
-1,170
-1,540
Estimated CapEx by year AS AT DECEMBER 31, 20242
US$ MILLION
2025
2026
2027
Total CapEx net of financing
-1,412
-1,479
-1,535
1 The figure for 2022 has been corrected.
2 Subject to change and may differ from actual capital expenditures.
LATAM
GROUP
2024
03 / OUR BUSINESS
FLEET COMMITMENTS
The total of fleet commitments is calculated utilizing
LATAM’s purchase price from manufacturers and
the present value of commitments for aircraft to be
received from lessors as operating leases according
to International Financial Reporting Standards (IFRS
16). These fleet commitment amounts are calculated
based upon the fleet commitments consistent with
the fleet arrivals considered in the fleet plan published
in the quarterly Earnings Releases, which are based
on the best estimates of fleet arrivals from both
aircraft manufacturers and lessors.
It should be noted that, in general, LATAM evaluates
financing alternatives to meet its fleet commitments
and, therefore, the amounts presented are not
necessarily indicative of a cash outflow.
Aircraft arriving under an operating lease do not
represent a cash outflow upon arrival, but rather
represent the recognition of a right-of-use asset and
a lease liability. On the other hand, aircraft arriving
under finance lease will represent a cash outflow
equivalent to the cost of the aircraft net of the total
financing raised. This cash outflow from aircraft
arriving under finance leases is included within the
total CapEx net of financing.
Fleet commitments per year as
AT DECEMBER 31, 2024
US$ 1,116MM
2025
US$ 1,303MM
2026
US$ 1,085MM
2027
› 30
LATAM
GROUP
2024
03 / OUR BUSINESS
STOCK INFORMATION
NCG 519: 2.3.4.iii STOCKS, THEIR CHARACTERISTICS AND RIGHTS
Stock Market Presence
Santiago Stock Exchange: 100%
Nueva York Stock Exchange1: 44%
LATAM Airlines Group S.A. is an open stock corporation
registered before the Financial Market Commission
(CMF, for its Spanish acronym), under Nº 306, whose
shares are traded in Chile on the Santiago Stock
Exchange, (BCS, for its Spanish acronym) and the
Chilean Electronic Exchange-Stock Exchange (BEC,
for its Spanish acronym).
During 2024, LATAM Airlines Group S.A. resumed
trading on the New York Stock Exchange (NYSE)
through its American Depositary Receipts (ADR)
program, after previously trading on the Over-the-
Counter (OTC) market in the United States.
ANNUAL RETURN
ADR
S&P 500
LOCAL
STOCKS
IPSA S&P
+11.66%
+23.31%
+43.77%
+8.27%
2024
N° OF SHARES
TRADED
AVERAGE PRICE
TOTAL AMOUNT
TRADED
(QUARTERLY AVERAGE)
Volumes traded by quarter—Local stock (Santiago Stock Exchange)
(MILLION CLP)
(CLP)
(MILLION USD)
First quarter
47,341
11.2
8.9
Second quarter
57,750
12.8
12.4
Third quarter
63,477
11.9
13.4
Fourth quarter
60,761
13.2
13.8
Volumes traded by quarter - ADR (New York Stock Exchange).
(MILLION USD)
(USD)
(MILLION USD)
First quarter
N/A
N/A
N/A
Second quarter
N/A
N/A
N/A
Third quarter
31.0
24.9
16.2
Fourth quarter
11.6
27.3
5.0
N/A: Not applicable. LATAM Airlines Group S.A. traded on the Over-the-Counter (OTC) market prior to the relisting of its ADRs
in July 2024.
1 The return of LATAM Airlines Group S.A. to the NYSE took place on July 25, 2024, explaining its trading presence in the period.
LOCAL STOCK– 2024
– IPSA – LTM
01/02/2024
12/31/2024
ADR – 2024
– S&P 500 – ADR
50%
40%
30%
20%
10%
0%
-10%
01/02/2024
12/31/2024
50%
40%
30%
20%
10%
0%
-10%
› 31
LATAM
GROUP
2024
› 32
04 / CORPORATE GOVERNANCE
04
_CORPORATE GOVERNANCE
34 OWNERSHIP STRUCTURE
40 BOARD OF DIRECTORS
49 ORGANIZATIONAL CHART
50 MAIN EXECUTIVES
55 CORPORATE GUIDELINES
67 STAKEHOLDER ENGAGEMENT
70 FINANCIAL POLICIES
› 33
COMPONENTS OF
CORPORATE GOVERNANCE
NCG 519: 3.1 GOVERNANCE FRAMEWORK & 3.3.I BOARD COMMITTEES
GRI 2-9 AND 2-23
COMMITTEES
FINANCE
SUBCOMMITTEE
Supervision and
recommendations to
the Board regarding
financial performance.
SUBCOMMITTEES
DIRECTORS
COMMITTEE
Supervision, oversight
and recommendations
to the Board on specific
topics required by law.
(Committee required by
Chilean regulation).
AUDIT COMMITTEE
Supervision, oversight
and recommendations
to the Board on specific
topics required by law.
(Committee required by
U.S. regulation).
STRATEGY &
SUSTAINABILITY
SUBCOMMITTEE
Analysis and
recommendations
to the Board and
strategic decisions, as
well as supervision in
sustainability matters.
LEADERSHIP
SUBCOMMITTEE
Analysis and
recommendations
to the Board on the
organizational structure
and compensation policy.
BOARD OF DIRECTORS
⚫ The board of directors consists of nine directors
⚫ Defines and monitors strategic guidelines.
⚫ Elected by the Shareholders' Meeting through cumulative voting.
EXECUTIVES
⚫ Executive Committee, comprised by the top executives.
⚫ Executes strategic guidelines.
› 33
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
› 34
04 / CORPORATE GOVERNANCE
OWNERSHIP STRUCTURE
NCG 519: 2.3.1 CONTROL SITUATION, 2.3.4.I AND 2.3.4.III
STOCKS, THEIR CHARACTERISTICS AND RIGHTS AND 2.3.5
OTHER SECURITIES
LATAM Airlines Group S.A. needs to maintain
a suitable level of capitalization to ensure safe
access to financial markets, and thus, to develop its
medium- and long-term goals, optimizing returns to
its shareholders and maintaining a sound financial
position.
Along these lines, by December 31, 2024, the statutory
capital of LATAM Airlines Group S.A. is represented
by 604,441,789,335 shares, all issued, common, and
without par value. Of this amount, at that time,
604,437,877,587 shares had been subscribed and
paid up. Meanwhile, paid-in capital at December
31, 2024 was ThUS$5,003,534.
A year earlier, that is, by December 31, 2023, the
paid-in capital was ThUS$5,003,534 divided among
604,437,877,587 shares, also from the same and
only nominative, ordinary series, without par value.
We should note that there are no special series of
shares, nor preferences. Thus, the form of the stock
certificates, their issuance, exchange, disablement,
loss, replacement, and any other circumstance,
as well as the transfer of shares, are ruled by the
provisions included in the Chilean Corporations Act
(LSA, for its Spanish acronym) and its Regulations.
On the other hand, at the Extraordinary Shareholders'
Meeting of LATAM Airlines Group S.A. held on April
25, 2024, the following resolutions, among others,
were adopted:
⚫ Elimination of the Fourth Transitory Article of
the Company's Bylaws: This article, which regulated
the first renewals of the Board of Directors after the
restructuring under the Chapter 11 proceeding, was
deleted, allowing elections for the Board of Directors
to be governed henceforth by the permanent general
articles of the Bylaws.
⚫ Decrease in Share Capital: The Bylaws reflect the
reduction of the share capital of LATAM Airlines Group
S.A. By US$123,605,757, representing 1,965,903,665
shares, as a consequence of the expiration of the
terms for the issuance of convertible bonds issued
in 2022 in the context of the exit from the Chapter
11 proceeding.
⚫ Bylaws Update: The Bylaws of LATAM Airlines
Group S.A. were amended to reflect the above
changes regarding the share capital and the term
of the Board of Directors.
⚫ Powers of the Board of Directors: The Board of
Directors was granted broad powers to implement
the adopted agreements, including representation
before regulatory entities and the formalization of
changes in the relevant registries.
OTHER SECURITIES
NCG 519: 2.3.4.I STOCKS, THEIR CHARACTERISTICS AND RIGHTS
AND 2.3.5 OTHER SECURITIES
The details of all "Other securities" as of the closing
date of the 2024 fiscal year are presented in the
Financial Statements included in this Annual Report,
in Notes 3 and 18.
› 34
At December 31, 2024,
LATAM Airlines Group
S.A. has no controlling
shareholder and the number
of registered shareholders
totals 2,131.
LATAM
GROUP
2024
LATAM
GROUP
2024
› 35
04 / CORPORATE GOVERNANCE
SHAREHOLDER STRUCTURE
NCG 519: 2.3.2 MAJOR CHANGES IN OWNERSHIP OR CONTROL, 2.3.3 IDENTIFICATION OF MAJORITY PARTNERS OR SHAREHOLDERS
CATEGORY
2023
2024
American Depositary Receipt (ADR)
0.01%
22.7%
Pension funds
2.2%
7.0%
Other shareholders
97.7%
70.3%
24.1%
145,646,987,995
Sixth Street Partners
Management Company
13.8%
83,600,686,000
Strategic Value
Partners - ADR
10.0%
60,722,284,826
Delta Air Lines, Inc
10.0%
60,640,769,249
Qatar Airways
Investments (UK) LTD.
21.1%
127,399,572,542
Others
8.9%
53,508,318,978
Other ADRs
7.0%
42,529,701,772
AFP
5.0%
30,389,556,225
Cueto Group
As at December 31, 20241
The information reflects LATAM Airlines Group S.A.’s shareholder structure as reflected in shareholder’s registry from the
“Depósito Central de Valores (DCV)” and complemented by scheduled 13F filings with the Securities Exchange Commission
(SEC). From the total number of shares registered in the name of "Banco de Chile por Cuenta de State Street", Banco de Chile
confirms the amount of shares corresponding to Sixth Street Partners Management Company.
1 At December 31, 2024, LATAM Airlines Group S.A. has no majority or controlling shareholders, nor other funds aside from
those stated. For this reason, the "other shareholders" category represents 70.3% of the total, while the total percentage of
American Depositary Receipts (ADRs) of LATAM Airlines Group S.A. is 22.7% while for Pension Funds it is 7.0%.
As at December 31, 2023
100%
0.01%
86,064,978
ADR
27.9%
168,669,825,995
Sixth Street Partners
Management Company
16.0%
96,815,692,279
Strategic Value Partners
10.0%
60,722,284,826
Delta Air Lines, Inc
28.7%
173,601,946,765
Others
2.2%
13,511,737,270
AFP
5.0%
30,389,556,225
Cueto Group
10.0%
60,640,769,249
Qatar Airways
Investments (UK) LTD.
100%
604,437,877,587
SHARES
604,437,877,587
SHARES
BOARD MEMBERS’ AND SENIOR EXECUTIVES’
SHAREHOLDING
NCG 519: 3.4.IV SENIOR EXECUTIVES
As in 2023, Ignacio Cueto (Chairman of the LATAM
Airlines Group S.A. BOD), Enrique Cueto (member
of the LATAM Airlines Group S.A. BOD), and certain
other members of the Cueto family and companies
controlled by them, comprise the Cueto Group.
Along these lines, at December 31, 2024, the Cueto
Group's shareholding stands at 5.03% of the shares.
However, just as at the end of the previous year, no
other LATAM Airlines Group S.A. Board Members or
chief executives hold a stake in the issuer.
LATAM
GROUP
2024
› 36
04 / CORPORATE GOVERNANCE
CHANGES IN OWNERSHIP
NCG 519: 2.3.2 MAJOR CHANGES IN OWNERSHIP OR CONTROL
In the last three years (i.e., 2022, 2023 and 2024),
the main changes in the percentage of ownership
held by the major shareholders of LATAM Airlines
Group S.A. (with more than a 5% stake) have been
the following:
YEAR
SHAREHOLDER
TYPE OF
CHANGE
BREAKDOWN OF CHANGE VS. PREVIOUS YEAR
FINAL STAKE
2022
Sixth Street Partners Management Company
Entry
New stake
27.9%
Strategic Value Partners
Entry
New stake
16.0%
Sculptor Capital
Entry
New stake
6.6%
Delta Air Lines, Inc.
Decrease
-10.0pp
10.0%
Cueto Group
Decrease
-11.4pp
5.0%
ADR
Decrease
-13.1pp
0.01%
2023
Sculptor Capital
Decrease
-4.1pp
2.5%
2024
ADR
Increase
+22.69pp (including transfer of Strategic Value Partners)
22.7%
AFP
Increase
+4.8pp
7.0%
Sixth Street Partners Management Company
Decrease
-3.8pp
24.1%
Strategic Value Partners
Decrease
-2.2pp
13.8%
Note: In the table, "pp" stands for "percentage points.
› 36
› 36
Laguna Verde, Bolivia
LATAM
GROUP
2024
› 37
04 / CORPORATE GOVERNANCE
MAIN SHAREHOLDERS
NCG 519: 2.3.2 MAJOR CHANGES IN OWNERSHIP OR CONTROL, 2.3.3 IDENTIFICATION OF
MAJORITY PARTNERS OR SHAREHOLDERS, 2.3.4.I STOCKS, THEIR CHARACTERISTICS AND RIGHTS
As at December 31, 20241
NAME
RUT
SHARES
SUBSCRIBED
AND PAID
PERCENTAGE OF
OWNERSHIP
Banco de Chile on behalf of State Street
97.004.000-5
156,734,468,639
25.9%
JP Morgan Chase Bank (ADR)
40.000.535-4
137,109,004,978
22.7%
Delta Air Lines, Inc.
59.288.750-9
60,722,284,826
10.0%
Qatar Airways Investments (UK) Ltd.
59.222.850-5
60,640,769,249
10.0%
Banco Santander on behalf of. foreign investors
97.036.000-K
27,549,036,179
4.6%
Costa Verde Aeronáutica S.A.
81.062.300-4
23,789,209,717
3.9%
Banco de Chile on behalf of non-resident third parties
97.004.000-5
19,372,014,431
3.2%
Banco Santander Chile
97.036.000-K
10,515,677,491
1.7%
Banco de Chile on behalf of Citi NA New York Client
97.004.000-5
7,500,916,423
1.2%
Banchile Corredores de Bolsa S.A.
96.571.220-8
6,885,944,595
1.1%
Costa Verde Inversiones Financieras S.A.
76.183.853-9
6,592,460,617
1.1%
Larrain Phial S.A. Corredora de Bolsa
80.537.000-9
5,982,898,602
1.0%
As at December 31, 20231
NAME
RUT
SHARES
SUBSCRIBED
AND PAID
PERCENTAGE OF
OWNERSHIP
Banco de Chile on behalf of State Street
97.004.000-5
277,500,905,697
45.81%
Banco de Chile on behalf of non-resident third parties
97.004.000-5
70,343,556,555
11.94%
Delta Air Lines, Inc.
59.288.750-9
60,722,284,826
10.05%
Qatar Airways Investments (UK) Ltd.
59.222.850-5
60,640,769,249
10.03%
Banco Santander on behalf of. foreign investors
97.036.000-K
25,550,380,291
3.94%
Costa Verde Aeronáutica S.A.
81.062.300-4
23,789,209,717
3.94%
Banco Santander Chile
97.036.000-K
15,382,571,149
3.02%
Larrain Phial S.A. Corredora de Bolsa
80.537.000-9
7,394,408,211
1.19%
Costa Verde Inversiones Financieras S.A.
76.183.853-9
6,592,460,617
1.09%
Banchile Corredores de Bolsa S.A.
96.571.220-8
5,240,203,041
0.82%
Banco de Chile on behalf of Citi NA New York Client
97.004.000-5
4,407,844,262
0.73%
AFP Habitat S.A. C-type Pension Fund
98.000.100-8
2,232,103,282
0.41%
1 Note: All LATAM Airlines Group S.A. shares are issued, ordinary and without par value, and therefore, there are no special or preferred series.
LATAM
GROUP
2024
› 38
04 / CORPORATE GOVERNANCE
DIVIDENDS
NCG 519: 2.3.4.II Y 2.3.4.III STOCKS, THEIR
CHARACTERISTICS AND RIGHTS
In accordance with the Chilean Corporations Act
(LSA, for its Spanish acronym), LATAM is required
to distribute cash dividends equal to at least 30%
of its annual consolidated net profit, calculated in
accordance with International Financial Reporting
Standards (IFRS), provided that there are no losses
accrued and subject to limited exceptions. If in a
given year there are no net profits, LATAM may elect
to distribute dividends out of retained earnings,
although it is not legally required to do so. The
Board of Directors may declare interim dividends
from profits earned during such period, to the extent
that the Company's financial condition permits. This
policy is intended to be sustained over the next two
years.
According to LATAM's bylaws, the annual cash
dividend must be approved by the shareholders at
the annual Ordinary Shareholders' Meeting, which is
held within the first four months of the year following
the year in which the dividend is proposed. All shares
outstanding of common stock are entitled to receive
dividends on equal terms, except for those that have
not been fully paid by the shareholder after having
been subscribed.
LATAM declares dividends in U.S. dollars, but makes
payments in Chilean pesos, converted from U.S.
dollars at the observed exchange rate five business
days prior to the first payment to shareholders.
Holders of ADSs will be entitled to receive dividends
on the underlying ordinary shares on an equal basis
with holders of ordinary shares. Holders of ADRs on
the relevant record dates will receive dividends paid
on the ordinary shares represented by the ADSs
evidenced by such ADRs. Dividends payable to ADS
holders will be paid by LATAM to the depositary in
Chilean pesos and remitted by the depositary to
the holders, net of foreign currency conversion fees
and other expenses of the depositary, and will be
subject to Chilean withholding tax, currently set at
35% (subject to credit in certain cases). The amount
of U.S. dollars distributed to ADS holders may be
adversely affected by a devaluation of the Chilean
currency prior to the conversion and remittance of
such dividends. Holders of ADSs will not be subject
to dividend remittance charges by the depositary
in connection with cash dividends.
Chilean law requires holders of shares of Chilean
companies that are not residents of Chile to register as
foreign investors under one of the foreign investment
regimes provided by Chilean regulations to remit
dividends, sale proceeds or other sums related to their
shares outside Chile through the Formal Exchange
Market.
During 2023, LATAM Airlines Group S.A. reported
US$582 million in net profit attributable to the
owners of the controlling company. Thus, the Board
of Directors agreed and the Ordinary Shareholders'
Meeting approved the distribution of definitive,
minimum mandatory Dividend No. 52, corresponding
to 30% of the net profits for financial year 2023.
This translated into an equivalent sum in Chilean
pesos of US$174,549,442.99, which represented a
dividend of US$0.0002887797894 per share.
Thus, the payment was made on May 16, 2024,
in the Chilean peso equivalent at the "observed"
exchange rate published in the Official Gazette on
the fifth business day prior to the distribution; i.e.,
on May 10, 2024.
Shareholders registered in the Shareholders' Registry
by midnight on May 10, 2024 were the beneficiaries
of this payment.
YEAR
PAYMENT
DATE
TYPE
TOTAL DIVIDEND PAID
(US$ MN)
NUMBER OF SHARES
DIVIDEND PER SHARE
2021
N/A
N/A
No dividend distribution1
606,407,693
N/A
2022
N/A
N/A
No dividend distribution1
604,437,877,587
N/A
2023
16/5/24
Definitive
174.4
604,437,877,587
US$0.0002887797894
1 LATAM Airlines Group S.A. had accrued losses until 2023, so no dividend payments were made until 2024.
LATAM
GROUP
2024
› 39
04 / CORPORATE GOVERNANCE
CAPITAL MARKETS
NCG 519: 3.7. I AND 3.7.II RELATIONSHIP WITH STAKEHOLDERS
AND THE GENERAL PUBLIC
LATAM Airlines Group S.A. maintains an ongoing dialog
with its shareholders, others players in the debt and
capital markets, and the press. It also has Investor
Relations and Corporate External Communications
departments.
Specifically, the Investor Relations department
of LATAM Airlines Group S.A. makes it possible
to clarify the concerns of shareholders, investors
and other players of the capital markets regarding
the company’s financial and economic situation,
the main risks, strategy and other aspects of the
business. In fact, on the Investor Relations website,
LATAM group offers a breakdown of the corporate
governance structure, and publishes updated financial
statements, quarterly reports, and other relevant
data to assist shareholders, investors and market
SHAREHOLDERS’ MEETINGS
NCG 519: 3.7.IV RELATIONSHIP WITH STAKEHOLDERS AND
THE GENERAL PUBLIC
All shareholders may participate in the so-called
Shareholders’ Meetings, and have the right to voice
and vote therein. In order to carry them out, LATAM
Airlines Group S.A. complies with the times and
information required by the LSA, its Regulations and
other applicable regulations (including CMF General
Standard 30).
Likewise, prior to the Shareholders’ Meetings, with
the agreement of the BOD, LATAM Airlines Group S.A.
uploads all the relevant information to said process
to the Investor Relations website. Meanwhile, with
regard to the election of Board members, LATAM
Airlines Group S.A publishes the names of the
shareholders’ nominees, along with their nomination
and acceptance letters or sworn statements, as
may be the case. Thus, it is worth noting that no
information is published on the Board’s opinion
regarding the experiences, visions and skills that
are advisable for new members as, under Chilean
regulations, it is shareholders who nominate and
elect the Board members.
The most recent Shareholders’ Meetings have been
held remotely or in hybrid format, and shareholders
have been able to participate and exercise their
right to vote both remotely or on site. It should be
noted that LATAM Airlines Group S.A. does not have
a real-time audio and video streaming service for
non-shareholder audiences.
More information
Shareholders’ Agreement, page 216.
analysts in their decision-making processes. Generally,
all these contents are available in English, Spanish,
and Portuguese.
On the other hand, without the assistance of external
experts, the Investor Relations department internally
reviews on an annual basis the information presented
to the market by other players in its industry to
evaluate improvement opportunities for the data
and information presented to the public.
More information
Manual for Handling Relevant Information for Markets
Forms of Contact
Investor Relations - website: latamairlinesgroup.net
Contact
InvestorRelations@latam.com or
ComunicacionesExternas@latam.com
› 39
Camino a Los Yungas, Bolivia
LATAM
GROUP
2024
› 40
04 / CORPORATE GOVERNANCE
BOARD OF DIRECTORS
The Board of Directors defines and monitors the
strategic guidelines of LATAM Airlines Group S.A.
The BOD is comprised by nine incumbent directors,
who are elected individually for two-year terms by
the cumulative voting system—i.e., each shareholder
has one vote per share and may cast all their votes
in favor of one candidate or distribute them among
several. This system enables shareholders of at least
10% of the shares outstanding to choose at least
one representative.
It should be noted that this is a fixed structure, and
in cases of contingency or crisis (mainly in aviation
emergencies), the Board of Directors remains unchanged
and continues to function normally, supporting the
continuity of business operations.
The last election of Board members was held on April
25, 2024, following the resignation of Mr. Bouk Van
Geloven as member at the ordinary Board meeting
held on April 3, 2024, effective as of 23:59 hours on
April 24, 2024. As a result, the Board of Directors
was renewed at the following ordinary shareholders'
meeting and was composed of the following members:
Ignacio Cueto Plaza, Enrique Cueto Plaza, Frederico
F. Curado (independent), William de Wulf, Antonio
Gil Nievas, Bornah Moghbel, Michael Neruda, Sonia
Villalobos and Alexander D. Wilcox.
MEETINGS
NCG 519: 3.2.X AND 3.2.XII BOARD OF DIRECTORS
The Board of Directors holds both ordinary and
extraordinary meetings on a regular basis, depending
on the company’s needs, following legal requirements.
They do not have a minimum time commitment,
whether on-site or remote. Regular meeting notices
are issued at the beginning of each calendar year,
while extraordinary meetings are convened based
on corporate requirements.
In accordance with the provisions of the Bylaws of
LATAM Airlines Group S.A., the Board of Directors
must meet at least once a month in ordinary
meetings. In 2024, the average attendance at the
21 ordinary and extraordinary meetings held was
96%. Specifically, attendance at the meetings was
100% for Board members Enrique Cueto, Frederico
Curado, Antonio Gil, Michael Neruda and Alexander
Wilcox, while attendance was 95% for Board members
Ignacio Cueto and William de Wulf, 91% for Sonia
Villalobos, and 81% for Bornah Moghbel.
For each meeting, the members of the Board
of Directors are summoned with due notice and
have access to a digital information system where
documents with relevant background information
for their preparation, minutes of previous meetings,
and the matters to be discussed at the meeting
are all centralized. This system keeps a record of
the historical data of the Board's documents since
2016 and is updated roughly one month after each
meeting with the corresponding minutes, remaining
available going forward.
In addition, Board members, as well as all LATAM
group stakeholders, can access the Confidential
Channel available online. (See more in the Confidential
Channel section of this chapter).
INDUCTION, TRAINING AND EVALUATION OF
THE BOARD OF DIRECTORS
NCG 519: 3.2.V AND 3.2.IX BOARD OF DIRECTORS
GRI 2-17 AND 2-18
Following each election and in observance of the
Induction Policy, new members of the Board receive
the information and background related to matters
under evaluation and analysis by the Board, as well as
training on the regulatory framework and the duties
involved in the position as Members of the Board.
This includes, among other aspects: sustainability
issues (including social responsibility); policies and
guidelines, particularly the Code of Conduct; business
affairs; risks; and financial and accounting aspects
for LATAM group.
Following the repeal of NCG No. 385 and the
incorporation of several of its topics into the Annual
Report, the Board of Directors has not implemented
additional performance evaluations.
NCG 519: 3.2.I AND 3.2.XI BOARD OF DIRECTORS
GRI 2-9, 2-10, 2-11 Y 2-17
96% average
attendance at Board
meetings in 2024
DIVERSITY IN BOARD SELECTION
PROCESSES
NCG 519: 3.7.III RELATIONSHIP WITH STAKEHOLDERS AND
THE GENERAL PUBLIC
Under the Chilean Corporations Law, the power to
elect Board members rests exclusively with the
shareholders, through Shareholders' Meetings. In
this regard, LATAM Group does not establish gender
quotas nor does it interfere in this process, except in
the specific case of vacancy, where current legislation
grants the Board of Directors the power to appoint
a replacement.
In this context, the Board of Directors has agreed
that, for the appointment of the replacement who
will hold the position until the next Shareholders'
Meeting—when the total renewal of the members
of the Board will take place—factors that contribute
to greater diversity, such as nationality, age and
gender, in addition to the capacity and suitability
of the candidate, will be considered.
In addition, for each shareholders' meeting at which
Board members are to be elected, LATAM group
makes relevant information on the candidates
available to shareholders and the general public
through its website.
It should be noted that LATAM group does not have
a Nominating Committee to assist shareholders in
the search and selection of candidates to the Board
of Directors, nor does it provide a diversity approach
in these processes.
› 41
04 / CORPORATE GOVERNANCE
LATAM
GROUP
2024
COMPOSITION OF THE BOARD
NCG 519: 3. 2.IV, 3.2.VIII AND 3.2.XIII BOARD OF DIRECTORS
GRI 2-9, 2-10, 2-11
Matrix of knowledge and previous experience of Board members
IGNACIO
CUETO
BORNAH
MOGHBEL
ENRIQUE
CUETO
FREDERICO
CURADO
MICHAEL
NERUDA
ANTONIO GIL
NIEVAS
SONIA
VILLALOBOS
WILLIAM DE
WULF
ALEXANDER
WILCOX
IGNACIO
CUETO
BORNAH
MOGHBEL
ENRIQUE
CUETO
FREDERICO
CURADO
ANTONIO GIL
NIEVAS
MICHAEL
NERUDA
SONIA
VILLALOBOS
ALEXANDER
WILCOX
WILLIAM DE
WULF
AIRLINE INDUSTRY
●
●
●
●
●
CORPORATE
STRATEGY
●
●
●
●
●
●
●
RISKS
●
●
●
●
●
●
●
ECONOMICS AND
FINANCE
●
●
●
●
●
●
COMPLIANCE
●
●
●
ESG
●
CYBERSECURITY
●
04 / CORPORATE GOVERNANCE
Field visits
In 2024, the Board of Directors had no field visits.
Average length of service
GRI 2-9
The average length of service of the members of
the Board of Directors at the date of publication,
(March 2025) is 4.2 years.
Other mandates
None of the Board members hold senior positions
(director or CEO) in four or more other publicly listed
external companies.
MEN
WOMEN
BY SEX
8
1
BY NATIONALITY
Brazil
1
1
Chile
2
-
Spain
1
-
United States
3
-
France
1
-
BY AGE GROUP
Under 30 years
-
-
Between 31 and 40 years old
-
-
Between 41 and 50 years old
3
-
Between 51 and 60 years old
2
Between 61 and 70 years old
3
1
Over 70 years old
-
-
BY SENIORITY GROUP
Under 3 years
5
-
Between 3 and 6 years old
2
1
More than 6 and up to 9 years
1
-
More than 9 and up to 12 years
-
-
Over 12 years
-
-
PEOPLE WITH DISABILITIES
-
-
1 There are no deputy board members; they are all incumbent members.
› 42
CHARACTERISTICS OF THE BOARD OF DIRECTORS
NCG 519: 3.2.VIII AND 3.2.XIII BOARD OF DIRECTORS
LATAM
GROUP
2024
› 43
LATAM
GROUP
2024
IGNACIO CUETO
CHAIRMAN OF THE BOARD*
Ignacio Cueto has been a member of the Board of Directors and Chairman
of LATAM Airlines Group S.A. since April 2017, and has been reelected
to the Board of Directors since then, the last time being in May 2024.
With over 30 years of experience in the airline industry, he started
in 1985 as Vice President of Sales at Fast Air Carrier, a national cargo
airline, and held key roles as Service Manager and Commercial Manager
of the Miami sales office. Throughout his career, he has been a member
of the Board of Directors of Ladeco (1994-1997) and LAN (1995-1997),
President of LAN Cargo (1995-1998) and CEO of the Passenger Business
(1999-2005). Along these lines, in 2005, he stepped in as President
and COO of LAN, a position he held until the combination with TAM
in 2012. After the combination, he was CEO of LAN until April 2017,
playing a key role in the expansion of the LATAM Airlines Group S.A.
affiliates in South America and in the implementation of strategic
alliances with other airlines. In addition, Ignacio Cueto is a member
of the Colunga Foundation, which is dedicated to child welfare, and
is part of the Cueto Group. Until December 31, 2024, he held a 5.03%
stake in the outstanding shares of LATAM Airlines Group S.A. through
the Cueto Group.
7.040.324-2
BORNAH MOGHBEL
VICE-CHAIRMAN OF THE BOARD*
Bornah Moghbel has been the Vice-Chairman of the Board at LATAM
Airlines Group since November 2022. He is co-founder and partner of
Sixth Street, a leading global investment firm that provides capital
solutions to companies at all stages of their development. Based in
New York, Moghbel leads Sixth Street's corporate investments in public
markets and its global asset investment business. After co-founding
the firm in 2009, he established a presence in Europe before returning
to the United States in 2016. Previously, he was an investor at Silver
Point Capital and began his career in the Financial Sponsors group of
UBS Investment Bank. Moghbel earned a B.A. in Economics, with high
honors, and a minor in Business Administration from UC Berkeley.
Foreign
ENRIQUE CUETO
BOARD MEMBER*
Enrique Cueto has been a member of the Board at LATAM Airlines
Group since April 2020. Previously, he held the position of CEO since
the combination of LAN and TAM in June 2012. From 1983 to 1993,
he was the CEO of Fast Air, a Chilean cargo airline, and from 1993 to
1994, he was a member of the Board of Directors of LAN Airlines.
Subsequently, Enrique Cueto became the CEO of LAN until the
combination with TAM in 2012. In addition, Enrique Cueto is a member
of the Board of Directors of the Colunga Foundation, which works in
child welfare, and for the past 15 years, he has also been a member
of the Board of Directors of the Endeavor Foundation, an organization
dedicated to fostering entrepreneurship in Chile. He holds a degree in
Economics from the Catholic University of Chile and is the brother of
Ignacio Cueto, Chairman of the Board of Directors of LATAM Airlines
Group S.A. In addition, Enrique Cueto is part of the Cueto Group. Until
December 31, 2024, he held a 5.03% stake in the outstanding shares
of LATAM Airlines Group S.A. through the Cueto Group.
6.694.239-2
*LATAM group's Board of Directors was last elected on April 25, 2024.
NCG 519: 3.2.I BOARD OF DIRECTORS
GRUPO
LATAM
2024
04 / CORPORATE GOVERNANCE
› 44
04 / CORPORATE GOVERNANCE
FREDERICO CURADO
BOARD MEMBER*
(Independent under Chilean and U.S. regulations)*
Frederico Curado has been on the Board of LATAM Airlines Group S.A.
since November 2022 as an independent director. He has also been an
independent director of Transocean since 2013, where he chairs its HSE
and Sustainability Committee and serves on the Corporate Governance
Committee. In addition, he has been an independent director of ABB
since 2016, serving as chairman of its Compensation Committee.
Frederico Curado was CEO of Embraer from 2007 to 2016 and CEO
of Ultrapar from 2017 to 2021. He holds a degree in Mechanical-
Aeronautical Engineering from Instituto Tecnológico de Aeronáutica
(ITA) and an Executive MBA from Universidade de São Paulo (USP).
Foreign
ANTONIO GIL NIEVAS
BOARD MEMBER*
Antonio Gil Nievas joined the Board of LATAM Airlines Group S.A.
in November 2022. He is also a member of the Board of Sociedad
Química y Minera de Chile S.A., a Chilean company listed on the New
York Stock Exchange (NYSE). With over 25 years of experience in
strategic, managerial, financial and investment leadership at the global,
European and Latin American levels, Gil Nievas was CEO of Moneda
Asset Management for more than eight years, leading the management
of more than US$10.5 billion in assets. In addition, he worked at JP
Morgan, where he held key positions as Managing Director, Global CFO,
and member of several global executive committees. Previously, he
was a strategic consultant at Boston Consulting Group (BCG). He holds
a degree in Industrial Engineering with a specialization in Electronics
from ICAI (Universidad Pontificia Comillas, Spain), and obtained an
MBA from Harvard Business School. He also completed the Stanford
Executive Program.
23.605.789-5
MICHAEL NERUDA
BOARD MEMBER*
Michael Neruda has been a member of the Board at LATAM Airlines
Group S.A. since November 2022. He is a partner at Sixth Street, a
global investment firm that provides capital solutions to companies
at all stages of growth. Neruda leads restructuring and investments in
situations of distress, as well as Sixth Street's cross-cutting investments
in companies where public markets expertise and private equity financing
are combined to improve their balance sheets. Before joining Sixth
Street in 2015, he was a director at Watershed Asset Management,
where he led the firm's investments in the consumer and energy sectors.
Previously, he was an investment analyst at MHR Fund Management,
Silver Point Capital and Merrill Lynch. Neruda holds a BSc degree in
Management Science and Engineering from Stanford University and
is a CFA charterholder. He has been a Board member and investor
representative on several corporate boards, including LATAM Airlines
Group S.A., Neiman Marcus and Stallion Infrastructure Services, and
has also served on the Board of Governors of the Boys & Girls Clubs
of San Francisco.
Foreign
*LATAM group's Board of Directors was last elected on April 25, 2024.
NCG 519: 3.2.I BOARD OF DIRECTORS
04 / CORPORATE GOVERNANCE
LATAM
GROUP
2024
› 45
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
WILLIAM DE WULF
BOARD MEMBER*
William de Wulf joined the Board of Directors of LATAM Airlines Group
S.A. in April 2024. De Wulf is a Managing Director and member of the
North America Investment Team. Prior to joining Strategic Value Partners
(SVP), he worked at Goldman Sachs for over 10 years, serving in the
Americas and Europe Special Situations Groups. He holds a bachelor's
and a master's degree in Applied Mathematics and Economics from
the École Polytechnique in France, as well as a master's degree in
Financial Engineering from Columbia University. He currently serves
on the Boards of LATAM Airlines and Swissport, and previously served
on the boards of Vallourec and Vita.
SONIA VILLALOBOS
BOARD MEMBER*
(Independent under U.S. regulations)*
Sonia J.S. Villalobos joined the Board of Directors of LATAM Airlines
Group S.A. in August 2018. A Brazilian citizen and founding partner
of the firm Villalobos Consultoria, she has been a regular member of
the Board of Directors of several listed Brazilian companies, such as
Petrobras and Telefonica Vivo, since 2016. Between 2005 and 2009, she
was a fund manager at Larrain Vial AGF in Chile, where she managed
mutual and institutional funds. From 1996 to 2002, she was responsible
for Private Equity investments in Brazil, Argentina and Chile for Bassini,
Playfair & Associates, LLC, and since 1989, she was head of research
at Banco de Investimentos Garantia. Sonia Villalobos graduated in
Public Administration from Escola de Administração de Empresas de
São Paulo in 1984 and obtained a master's degree in Finance from the
same institution in 2004. She was the first person to become a CFA
charterholder in Latin America in 1994.
21.743.859-4
ALEXANDER WILCOX
BOARD MEMBER*
Alexander Wilcox has been a member of the Board at LATAM Airlines
Group S.A. since October 2020. With over 20 years of experience in
the aviation industry, was one of the founders of JetBlue Airways
and Founding President and COO of an airline in India. He is also co-
founder and CEO of JSX, a public charter airline in the United States,
recognized as the best in North America by NPS. Wilcox has been a
member of the Aspen Institute's Henry Crown Fellowship since 2011
and belongs to the Dallas Chapter of the Young Presidents' Organization
(YPO Gold). He has been a private pilot since 1987 and serves on the
Board of The Compass School of Texas in Dallas. He holds a degree in
Political Science and English from the University of Vermont.
Foreign
Foreign
*LATAM group's Board of Directors was last elected on April 25, 2024.
NCG 519: 3.2.I BOARD OF DIRECTORS
04 / CORPORATE GOVERNANCE
LATAM
GROUP
2024
LATAM
GROUP
2024
› 46
04 / CORPORATE GOVERNANCE
BOARD MEMBERS’ REMUNERATION
NCG 519: 3.2.II BOARD OF DIRECTORS AND 3.3.III BOARD COMMITTEES
GRI 2-19
Remuneration reported corresponds to fixed per diems for attendance to Board of Directors and Directors'
Committees and Subcommittees' meetings, while variable remuneration is presented as Remuneration
Units (URA, for its Spanish acronym), explained in detail on the Annexes chapter. These were approved in
the Ordinary Shareholders’ Meeting held on April 25, 2024.
1 Gross sums.
2 Directors Bornah Moghbel, William de Wulf and Michael Neruda waived their compensation as members of the Board of
Directors, the Directors' Committee and subcommittees.
3 Director William de Wulf was not on the Board of Directors of LATAM Airlines Group S.A. in 2023 and his predecessor
(Bouk van Geloven) had waived his compensation as a member of the Board of Directors and subcommittees.
More information
Annexes to chapter “Corporate Governance”, page 216.
NAME
POSITION
BOARD
DIRECTORS’
COMMITTEE
SUBCOMMITTEE
VARIABLE
REMUNERATION
TOTAL
Ignacio Cueto Plaza
Chairman
160,000
-
28,542
127,234
315,776
Bornah Moghbel2
Vice-chairman
-
-
-
-
-
Enrique Cueto Plaza
Board member
80,000
-
40,000
127,234
247,234
Frederico Curado
Board member
80,000
85,417
54,167
169,645
389,229
Antonio Gil Nievas
Board member
80,000
-
54,167
127,234
261,401
William de Wulf3
Board member
-
-
-
-
-
Michael Neruda2
Board member
-
-
-
-
-
Sonia J. S. Villalobos
Board member
80,000
50,001
40,000
169,645
339,646
Alexander D. Wilcox
Board member
80,000
-
25,000
127,234
232,234
Bouk Van Geloven3
Board member
-
-
-
-
-
Remuneration– per diems1 2024 (US$)
NAME
POSITION
BOARD
DIRECTORS’
COMMITTEE
SUBCOMMITTEE
VARIABLE
REMUNERATION
TOTAL
Ignacio Cueto Plaza
Chairman
160,336
0
50,778
80,802
291,916
Bornah Moghbel2
Vice-chairman
-
-
-
-
-
Enrique Cueto Plaza
Board member
80,174
0
40,081
80,802
201,057
Frederico Curado
Board member
80,174
76,839
50,778
107,736
315,527
Antonio Gil Nievas
Board member
80,174
0
50,778
80,802
211,754
William de Wulf3
Board member
-
-
-
-
-
Michael Neruda2
Board member
-
-
-
-
-
Sonia J. S. Villalobos
Board member
80,174
50,110
40,081
107,736
278,101
Alexander D. Wilcox
Board member
80,174
0
40,081
80,802
201,057
Bouk Van Geloven3
Board member
-
-
-
-
-
Remuneration– per diems1 2023 (US$)
SALARY RATIO (WOMEN/MEN)4
NCG 519: 3.2.XIII BOARD OF DIRECTORS
The fixed per diem for participation on the Board
of Directors is determined by the Shareholders’
Meeting and is the same for all Board members,
except the Chairman, who receives twice the sum
of other Board members.
AVERAGE5
MEDIAN6
Regular
members
100%
100%
Deputy
members
N/A
N/A
N/A: Not Applicable, since there are no deputy members.
4 The proportion of women’s gross hourly wages vs. men’s gross hourly wages in each functional category.
5 For the calculation of the average, the average income is considered.
6 For the calculation of the median, the values of the gross hourly per diem for women and men are ordered from lowest to highest, and the central
value of the first group is divided by the central value of the second group.
LATAM
GROUP
2024
› 47
04 / CORPORATE GOVERNANCE
More information
Annexes to chapter “Corporate Governance”, page 216.
DIRECTORS’ COMMITTEE
NCG 519: 3.3.I, 3.3.II, 3.3.VI, 3.3.VII BOARD OF DIRECTORS
COMMITTEES AND 3.2.VI Y 3.2.VII BOARD OF DIRECTORS
Until 2023, LATAM Airlines Group S.A. had a
Directors' Committee that also served as the Audit
Committee to comply with the Sarbanes-Oxley Act
of the United States of America and the guidelines
of the Securities and Exchange Commission (SEC).
In 2024, in the context of the re-listing of LATAM
Airlines Group S.A. securities on the New York Stock
Exchange in the United States, the Board of Directors
approved on July 17, 2024 the proposal of the
Directors' Committee to create an Audit Committee
specifically for U.S. law purposes, separating both
committees.
Along these lines, the Directors' Committee continues
to report monthly to the Board of Directors, through
a presentation made by its Chair during the ordinary
meetings. In these meetings, they cover topics related
to internal audit and control, such as the approval
of the internal audit plan, external audit oversight
and SOX certification, as well as risk management.
Meanwhile, social responsibility issues are also
presented annually to the Directors’ Committee and
the Board. In these sessions, the Corporate Affairs
and Sustainability department, presents its annual
report highlighting advances in the implementation
of LATAM group's Sustainability Strategy, including
social responsibility topics. This strategy encompasses
the pillars of environmental management, climate
change management, circular economy and shared
value.
All meetings of the Directors' Committee are
regularly attended by the Vice President of Legal &
Compliance and the executives responsible for the
matters discussed. It should be noted that the CEO
does not participate in these meetings on a regular
basis.
Up to December 31, 2023 and December 31, 2024,
the Directors' Committee consisted of Frederico
Curado, Sonia J. S. Villalobos and Michael Neruda. In
accordance with the Chilean Corporations Law (LSA),
only Frederico Curado, Chairman of the Committee,
qualifies as an independent director, as he has no
significant ties to LATAM Airlines Group S.A. or to
the senior executives.
In addition to the Directors' Committee and the
Audit Committee, LATAM Airlines Group S.A. also
has three other subcommittees that support the
Board of Directors in making decisions, which are:
Finance; Strategy & Sustainability; and Leadership.
It is important to mention that all the Board meetings
mentioned above are regularly attended by the
CEO, the CFO, and the Vice President of Legal &
Compliance, as well as by the senior executives in
charge of the different subjects to be reviewed at
each Board meeting.
Meetings of the Board of Directors
and the Directors' Committee with the
Auditors of the Financial Statements
The Directors' Committee meets on a quarterly
basis with the external auditors to review both
the quarterly and annual financial statements of
LATAM Airlines Group S.A., as established in Article
50 bis of the Chilean Corporations Law (LSA, for
its Spanish acronym). During these meetings, the
planning of the audit work, its scope, focus areas
and the relationship with regulatory requirements,
among other topics, are reviewed.
The audit firm also presents to the Board of Directors,
at least once a year, the work plan for the following
year and the results of the audit, including the main
recommendations.
Audit committee
In 2024, LATAM Airlines Group S.A. created an
Audit Committee composed of directors Frederico
Curado and Sonia J.S. Villalobos, which reports on
a quarterly basis to the Board of Directors.
Some of the main objectives of the Audit Committee
are to assist the Board of Directors in supervising
the integrity of the financial statements of LATAM
Airlines Group S.A., the evaluation of the performance,
independence and qualifications of the external
auditors, and the performance, planning and
initiatives of the internal audit team. In addition, it
oversees LATAM Airlines Group S.A.’s compliance
with legal and regulatory requirements, among
other responsibilities.
› 48
04 / CORPORATE GOVERNANCE
GUIDELINES FOR ENGAGING SERVICES
NCG 519: 3.2.III BOARD OF DIRECTORS AND 3.3.V BOARD
COMMITTEES
Both the Board of Directors and the Directors'
Committee may hire experts to provide advice on
specific matters such as accounting, finance, tax,
legal or others; however, the member or members
who require the hiring of an expert must justify
it in a meeting. Along these lines, the hiring of an
advisor must follow LATAM Airlines Group S.A.'s
policies for hiring suppliers, conflicts of interest and
market conditions. In addition, management must
propose a list of candidates for the Board members
to choose from, and it is possible that one or more of
its members can veto the engagement of a specific
advisor.
During 2024, the Board of Directors did not report
any expenses for accounting, tax, financial, legal
or other advisory services. Likewise, the Directors'
Committee did not record any expenses for advisory
services in these areas.
On the other hand, with regard to the services
contracted with the firm in charge of auditing the
financial statements, it must be made clear that
their contracting is not financed with the budget of
the Board of Directors. In this regard, in fiscal year
2024, LATAM Airlines Group S.A. paid for these
services a total of ThUS$2,011 to external auditors
PricewaterhouseCoopers Consultores Auditores
y Compañía Limitada. Of this total, ThUS$2,007
corresponded to audit fees, while fees for other
services amounted to US$4 thousand. There were no
payments for audit-related services or tax services
during the period.
SUSTAINABILITY GOVERNANCE FRAMEWORK
NCG 519: 3.1.II GOVERNANCE FRAMEWORK, 3.2.VI AND
3.2.VII BOARD OF DIRECTORS, 3..6.V RISK MANAGEMENT
AND 4.2 STRATEGIC OBJECTIVES
GRI 2-12 AND 2-13
The commitment to sustainability is a comprehensive
part of the business and of decision-making at all
levels of LATAM group. Accordingly, the Corporate
Affairs and Sustainability Directorate, together with
the organization's leaders and in accordance with
the objectives of LATAM group and best practices
worldwide, defines the strategy for that matter and
promotes its implementation in the countries where
the group operates.
To ensure compliance with the objectives, Corporate
Affairs consolidates information on the main
progress and gaps associated with Sustainability
on a quarterly basis. Thus, based on their criticality
and relevance, the results are regularly presented to
the members of the Executive Committee and the
CEO of LATAM group for decision-making, and in
addition, Management carries out an annual review
of the results of the Environmental Management
System (EMS).
Nonetheless, the Board of Directors’ Strategy and
Sustainability Subcommittee, which reports to
the Board of Directors, is the highest authority for
analyzing results and making strategic decisions on
sustainability, and it reports annually on the progress
on the aspirations and commitments in this arena,
including social responsibility topics. Likewise, these
matters are presented on an annual basis to the
Directors’ Committee and the Board. (See more in
the chapter on Commitment to Sustainability).
› 48
LATAM
GROUP
2024
› 49
ORGANIZATIONAL CHART
NCG 519: 3.1.VII GOVERNANCE FRAMEWORK
EXECUTIVE SPHERE
GRI-13
The CEO is the highest-ranking executive in LATAM
Airlines Group S.A. and reports directly to its Board
of Directors. Their main responsibility is to supervise,
direct and control the overall management of the
business.
Meanwhile, the executive sphere of LATAM Airlines
Group S.A. is divided into six large areas. These
are: Cargo, Customers, Commercial, Finance,
Operations and Human Capital. Each has clearly
divided responsibilities to execute and monitors
the strategy. Along these lines, the executives in
these six areas, in addition to the Vice-Presidents of
Legal & Compliance, Technology & Digital, Corporate
Affairs and the CEO of LATAM Airlines Brazil form an
Executive Committee that meets on a weekly basis
with the CEO of LATAM group. Likewise, the Strategic
Planning area supports the Executive Committee,
and other vice-presidencies participate in meetings
to address specific issues.
It should be noted that each affiliate has a CEO, as
well as a group of executives. They are responsible
for each of the operations, respectively.
› 49
LATAM AIRLINES
CHILE
LATAM AIRLINES
COLOMBIA
LATAM AIRLINES
ECUADOR
LATAM AIRLINES
PERU
LATAM AIRLINES
BRAZIL
CEO
Digital and IT Vice-Presidency
Finance Vice-Presidency
Includes Management Control and Investor Relations
Vice-presidency of Operations
Legal Affairs and
Compliance Vice-Presidency
Commercial Vice presidency
People Vice-Presidency
Client Vice-Presidency
LATAM Cargo Group
Strategic Planning Management
Safety Management
Corporate Affairs Management
includes External Communications and Sustainability
BOARD OF
DIRECTORS
Directors
committee
Risk, Audit and
Internal Control
Audit
Committee
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
› 50
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
MANAGEMENT TEAM
NCG 519: 3.4.I SENIOR EXECUTIVES
ROBERTO ALVO
LATAM AIRLINES GROUP CEO
Roberto Alvo has been the CEO of LATAM
Airlines Group S.A. since March 31, 2020.
Prior to taking on this position, he was
the CCO, in charge of passenger and cargo
revenue management, in addition to
serving as Vice-President of International
and Alliances and Vice-President of
Strategic Planning and Development for
LATAM Airlines Group S.A. He joined LAN
Airlines in November 2001, holding various
positions such as Director of Administration
and Finance at LAN Argentina, Head of
Development and Financial Planning, and
Deputy Finance Manager. Previously, he
worked at Sociedad Química y Minera
de Chile S.A. He is a civil engineer and
holds an MBA from IMD in Lausanne,
Switzerland.
8.823.367-0
RICARDO BOTTAS
CHIEF FINANCIAL OFFICER*
Ricardo Bottas has nearly three decades
of experience in various industries,
including audits, energy, oil and gas,
insurance and healthcare. Throughout
his career, he has played key roles in
management, control, corporate finance,
mergers and acquisitions, as well as
investor relations, which has allowed him
to develop a comprehensive vision of the
market. Over the past 12 years, Ricardo
has held CEO and CFO positions in public
companies and regulated markets in Brazil,
leading major transformations in highly
competitive companies and industries in
challenging contexts. He holds a degree in
Business Administration from Universidad
de Salvador, Brazil, and has an MBA in
Corporate Finance from IBMEC in Rio de
Janeiro, Brazil.
Foreign
EMILIO DEL REAL
VICE-PRESIDENT OF HUMAN CAPITAL
Emilio del Real is the Vice-President of
Human Resources of LATAM Airlines Group
S.A., a position he has held since August
2005. Prior to joining, he was human
resources manager at D&S, a Chilean
retailer, from 2003 to 2005. Between 1997
and 2003, he served in various positions
at Unilever, including Human Resources
Manager at Unilever Chile, and Manager
of Training, Recruitment and Executive
Development for Latin America. Emilio
Del Real has a degree in Psychology from
the Gabriela Mistral University.
9.908.112-0
JUAN CARLOS MENCIÓ
LEGAL AFFAIRS AND COMPLIANCE
OFFICER
Juan Carlos Menció, has been the Vice-
President of Legal Affairs and Compliance
at LATAM Airlines Group S.A. since
September 1, 2014. Previously, he served
as general counsel for North America for
LATAM Airlines Group S.A. and its related
companies, as well as general counsel for
worldwide cargo operations—positions he
held since 1998. Prior to joining LAN, he
was in practice in New York and Florida,
representing various international airlines.
Mencio obtained a Degree in International
Finance and Marketing from the School
of Business at the University of Miami
and his Juris Doctor Degree from Loyola
University.
24.725.433-1
* In December 2024, Ricardo Bottas was appointed Vice President of Finance. His appointment will be effective once the corresponding
immigration requirements are met. In the meantime, Roberto Alvo remains responsible for the position on an interim basis.
RAMIRO ALFONSÍN
CHIEF COMMERCIAL OFFICER
Ramiro Alfonsín is the Chief Commercial
Officer (CCO) of LATAM Airlines Group
S.A. He was previously the CFO for
almost 9 years, leading the company's
transformation, its reorganization under
Chapter 11 and its return to the New
York Stock Exchange. Prior to LATAM,
he held senior positions in the energy
sector in Spain, Italy and Latin America,
and worked in investment banking. He
holds a degree in Business Administration
from the Pontificia Universidad Católica
de Argentina and has studied at Harvard
Business School and the University of
Chicago Booth School of Business.
22.357.225-1
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
› 51
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
HERNAN PASMAN
VICE-PRESIDENT OF OPERATIONS
AND MAINTENANCE
Hernán Pasman has been the Vice-
President of Operations, Maintenance and
Fleet at LATAM Airlines Group S.A. since
October 2015. He joined LAN Airlines in
2005 as Head of Strategic Planning and
Financial Analysis of the technical areas.
Between 2007 and 2010, he was COO of
LAN Argentina, and in 2011, he became
CEO of LAN Colombia. Formerly, Pasman
worked as a consultant at McKinsey &
Company in Chicago, and held positions
at Citicorp Equity Investments, Telefónica
de Argentina, and Motorola de Argentina.
He holds an Industrial Engineering degree
from ITBA (1995) and an MBA from Kellogg
Graduate School of Management (2001).
21.828.810-3
JULIANA RIOS
VICE PRESIDENT OF IT & DIGITAL
Juliana Rios has been the Vice President
of IT & Digital at LATAM Airlines Group
S.A. since January 2021, leading the
digital transformation efforts. With
more than 20 years of experience in
services and technology in the financial
and airline industries, she has excelled in
areas such as business transformation,
mergers and acquisitions, digitization,
IT and large-scale project management,
including PSS migration. Prior to joining
LATAM Airlines Group S.A., Rios held an
executive position at Banco Santander,
Brazil, where she led the retail business
strategy and customer experience, as
well as heading integration programs in
Brazil, Italy and the Netherlands. She
holds a degree in Business Administration
and an MBA in Corporate Management
from IBMEC.
Foreign
JUAN JOSÉ TOHÁ
DIRECTOR OF CORPORATE AFFAIRS
AND SUSTAINABILITY
Juan Jose Toha is a journalist with a
specialty in Sustainability from Oxford
University, as well as a Master's and PhD
in Communication from the Universidad
Autónoma de Barcelona. He has vast
experience in the design and implementation
of communication strategies and the
interaction of organizations with their
environment. He has served in the
regional office of the United Nations
Food and Agriculture Organization (FAO)
for Latin America and the Caribbean in
Santiago, Chile, and has held positions
as Communications Manager for Codelco
and BHP South America, among others.
In 2019, he joined LATAM Airlines Group
S.A. as Director of Corporate Affairs
and Sustainability, reporting directly to
the CEO, and he is at the head of the
corporate strategy of public affairs, external
communications, and sustainability.
16.655.612-0
ANDRÉS BIANCHI
CEO LATAM CARGO GROUP
Andres Bianchi has been the CEO of
LATAM Cargo Group since 2017, where he
manages and coordinates the air freight
activities of the affiliates of LATAM Airlines
Group S.A. He joined LATAM Cargo Group
in 2010 and has held several leadership
positions prior to his current position,
including CCO for North America, Europe
and Asia, VP of the Cargo Network, and
CFO. Prior to joining LATAM Cargo Group,
he worked as a consultant at McKinsey &
Company and, between 2002 and 2006,
he was head of Investor Relations at LAN
Airlines. Andres Bianchi holds a degree
in Business Administration from the
Pontificia Universidad Católica de Chile
and an MBA from The Wharton School
of the University of Pennsylvania.
8.867.785-4
PAULO MIRANDA
CLIENTS VICE-PRESIDENT
Paulo Miranda has been the Clients Vice-
President of LATAM Airlines Group S.A.
since May 2019. With over 20 years of
experience in the aviation industry, he has
held different positions at Delta Air Lines
in the United States, and at Gol Linhas
Aéreas in Brazil. In his last role, he was
in charge of the Customer Experience
department, having previously worked
in finance and alliances, as well as in the
negotiation and implementation of joint
ventures. Miranda holds a Bachelor of
Business Administration degree from the
Carlson School of Management, University
of Minnesota.
Foreign
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
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04 / CORPORATE GOVERNANCE
EXECUTIVES’ REMUNERATION
NCG 519: 3.4.II AND 3.4.III SENIOR EXECUTIVES, 3.6.XI AND
3.6.XII RISK MANAGEMENT
GRI 2-19 AND 2-20
LATAM group has a compensation policy for wage
structures that applies to all positions, and consists
of the methodology of weighting positions (points
and grades) and salary scales (based on market
research), which guides all salary movements, both
for merit and promotions within the organization.
The Leadership Committee, comprised of four directors,
is responsible for analyzing LATAM group's top-level
organizational structure and corporate compensation
policy. Its function is to align remunerations
with the company's strategic objectives, reward
good performance and behavior, and prevent the
compensations policy from generating any type of
incentive for key executives to act contrary to the
interests of LATAM group, its policies, guidelines and
current regulations. Along these lines, the Committee’s
work includes the review and evaluation of models and
best practices available in the market (benchmarking).
Thus, the Leadership Subcommittee reviews these
topics prior to submitting these proposals to the
Directors’ Committee.
Likewise, according to the legislation applicable to
LATAM group as an open corporation (Article 50 bis
of the Corporations Act), the Directors’ Committee
has the obligation and power, among other things, to
examine the remunerations systems and compensation
plans for the Company’s managers, senior executives
and employees.
In turn, each time there is a change, LATAM group’s
VP of Human Resources must present it to the
Directors’ Committee. Furthermore, once a year, the
Directors’ Committee presents the compensation
for senior management to the Board of Directors.
It should be noted that the policy is not disclosed
to the general public, but it is published on LATAM
group’s internal portal for employees. Along these
lines, neither the policy nor the salary structures
of the CEO and senior executives are subject to
shareholder approval.
The Leadership Committee is
responsible for analyzing LATAM
group's top-level organizational
structure and corporate
compensation policy.
Executives’ remuneration
2024
2023
US$
CLP$
US$
CLP$
Fixed remuneration
22,574,793
22,070,472,322
24,768,065
21,537,317,664
Variable remuneration1
20,943,756
20,475,872,938
13,919,794
12,104,095,859
Total
43,518,550
42,546,345,260
38,687,858
33,641,413,523
1 The calculation of variable remuneration considers the profit-sharing bonus and two Management Protection Plan (MPP) payments as part of the CIP GEM
retention program.
› 52
During 2024, executive remuneration totaled
USD$43,518,550 (USD$22,574,793 from remuneration
and USD$20,943,756 from profit-sharing in March
2024). In turn, in 2023, USD$24,768,065 were paid as
remuneration and USD$13,919,794 as profit-sharing,
totaling USD$38,687,858 as gross remuneration.
Huacachina, Peru
LATAM
GROUP
2024
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
CIP GEM
LATAM group implemented a talent retention and
alignment program for GEM executives (CEO and
employees whose job description is "vice presidents"
or "directors"). Those who participants may opt
to receive cash payments as Remuneration Units
whose value is considered, by way of reference, to
be equivalent to the value of one share of LATAM
Airlines Group S.A., and consequently, in the event
that they are paid, they entitle the employee to
receive the cash payment resulting from multiplying
the number of Units paid by the value per share
of LATAM Airlines Group S.A. to be considered in
accordance with the CIP GEM program. Said Units
are the following:
1. Retention Shares Units (RSUs)
Retention Shares Units (RSUs) are units associated
with the employee's permanence in LATAM group
and, consequently, are associated with the passing
of time. Thus, overall, the CIP considers up to
2,346,862,183 RSUs, payable in installments per
the terms stated below.
It should be noted that, as a general rule, RSUs will
be eligible for vesting at the rate of one-third on
each of the following dates: month 24, month 36
and month 42, in each case, counted from LATAM
group’s exit date from the U.S. Chapter 11 proceeding
(hereinafter, the “Exit Date”). The foregoing, subject
to the occurrence of a triggering event related to the
volume of transactions of securities issued by LATAM
Airlines Group S.A. under the terms considered in the
CIP (hereinafter, a "VTE"—Volume Triggering Event).
Therefore, the number of RSUs that actually vest will
be determined based on the net resources accrued
as a result of a VTE on the respective determination
date (hereinafter, this adjustment will be referred
to as the "Pro Rata Factor").
Notwithstanding the above, the CIP GEM also
considers a "Guaranteed Minimum Vesting" pursuant
to which the percentage of RSUs set forth below
will vest on each date indicated, even if no VTE has
occurred. The foregoing, net of any RSUs that may
have vested previously.
2. Performance Shares Units (PSUs)
Performance Shares Units (PSUs) are the units linked
to both employee permanence and the performance
of LATAM Airlines Group S.A. measured based on the
stock price. Consequently, as with RSUs, these units
are related to the passage of time. However, PSUs
also consider the market value of LATAM Airlines
Group S.A. stock, considering a liquid market. Still, in
the absence of such a liquid market, the stock price
will be determined on the basis of representative
transactions.
Overall, the CIP considers up to 4,251,780,158 RSUs,
payable in installments, per the terms stated below.
It should be noted that, as a general rule, PSUs will
be eligible for vesting at the rate of one-third on
each of the following dates: month 24, month 36
and month 42, in each case, counted from the Exit
Date. The foregoing, subject to (i) the occurrence of
a VTE; and (ii) that the ratio (hereinafter, the "Net
Price/ERO Price Ratio” (ERO is the acronym for
Equity Rights Offering)) between the net price of
the sales originated in a VTE, divided by the price
per share at which the shares were issued by virtue
of the capital increase agreed at the LATAM Airlines
Group S. A. Extraordinary Shareholders' Meeting (i.e.,
USD$0.01083865799—hereinafter, the “ERO Price”),
is greater than 50%. The number of PSUs that will
actually vest will be determined based on the Pro
Rata Factor and the Net Price/ERO Price Ratio).
It follows that the PSUs constitute a contingent
and non-guaranteed payment. In addition, certain
of the GEM Executives will also be entitled to
receive a fixed, guaranteed cash payment ("MPP" -
Management Protection Plan) on certain dates under
the Reorganization Plan approved and confirmed
under the Chapter 11 Proceeding, at a rate of 33%
in the 18th month from the Exit Date, 34% in the
24th month from the Exit Date, and 33% in the 30th
month from the Exit Date. On the other hand, those
employees who are eligible for this MPP will also
be eligible for a limited number of additional RSUs
("MPP Based RSUs"). In total, the CIP considers
1,438,926,658 MPP Based RSUs. As a general rule,
MPP Based RSUs will be eligible to vest under the
same terms and conditions as the RSUs provided,
however, that they will be eligible for vesting at a
rate of one-third on each of the following dates:
month 18, month 24 and month 30, in each case,
counted from the “Exit Date”.
Guaranteed minimum vesting of RSUs
PERCENTAGE OF UNITS TO VEST
Month 30 from “Exit Date”
20%
Month 42 from “Exit Date”
30%
Month 60 from “Exit Date”
50%
In addition, an alternative modality is considered
so that up to 50% of the PSUs may vest when the
return per share, expressed as a percentage of the
ERO Price, is equal to or greater than 160%. The
foregoing, insofar as it occurs on or before the 60th
month from the Exit Date. Specifically, 25% of the
PSUs may vest as long as said return is equal to or
greater than 160%; and another 25% may vest as
long as said return is equal to or greater than 200%.
The number of PSUs that will ultimately vest under
this alternative modality, as well as the proportions
at which this will take place, will depend on the date
when said return levels are reached. PSUs that do
not ultimately vest under this alternative modality
will not be forfeited, and will be eligible for vesting
under the general CIP rules.
In both cases, the respective employees must have
remained as such in LATAM group at the corresponding
accrual date to be eligible to receive these benefits.
Given the characteristics of this program, it has
been recorded in accordance with IFRS 2 (Share-
Based Payments) and has been considered as a cash
settlement award and, therefore, recorded at fair
value as a liability under line items Trade Accounts
Payable, Other Accounts Payable and Provisions for
Non-Current Employee Benefits, which is restated
at the closing date of each financial statement,
affecting the income for the period classified in the
line item Administrative Expenses of the Consolidated
Income Statement by function.
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
Nonetheless, the fair value has been determined based
on the current value and the best estimate of the
future value of LATAM Airlines Group S.A.’s shares,
multiplied by the number of base units awarded.
This estimate was based on the Business Plan and
its main indicators, such as EBITDAR, adjusted net
debt.
CIP (CORPORATE INCENTIVE PLAN)
In order to encourage talent retention among the
employees of LATAM group’s companies and in
response to the exit from the Chapter 11 Proceeding,
our Board of Directors approved on April 25, 2023,
the extension of an extraordinary and exceptional
incentive called Corporate Incentive Plan ("CIP"). The
CIP includes incentives divided into three categories
adapted to three different groups or categories of
employees, hired directly by LATAM group companies.
These categories are: Non-executive employees;
Non-Global Executive Meeting or "GEM" Executives;
and GEM Executives. Employees in each of these
groups are only eligible for the CIP that corresponds
to their own category. The terms of each of these CIP
categories were communicated to the corresponding
employees between January and December 2023.
In all cases, the respective employees must have
remained as such in the companies of LATAM group
at the corresponding accrual date to be eligible to
receive these benefits.
During 2024, through December, the amount accrued
by the CIP was US$78.79 million, which is recorded
in the line item "Administrative Expenses" in the
Consolidated Income Statement by function. At the
end of December 2024, the provisioned balance of
this plan is US$152.6 million.
For a detailed description, see Note 22 (Employee
Benefits) in our audited consolidated financial
statements.
› 54
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
CORPORATE GUIDELINES
GRI 2-24, 2-26, 2-27, 206-1 AND 3-3
More information
⚫ Corporate Governance Practices Manual
⚫ Code of Conduct
⚫ Corporate Anti-Corruption Policy
⚫ Policy for Monitoring Related-Party Transactions
⚫ Code of Conduct for Third Parties and Third Party
Intermediaries
GUIDELINES FOR THE OPERATION OF CORPORATE
GOVERNANCE
NCG 519: 2.3.4.III STOCKS, THEIR CHARACTERISTICS AND
RIGHTS, 3.1.I. AND 3.1.III GOVERNANCE FRAMEWORK, 3.5
ADHERENCE TO NATIONAL OR INTERNATIONAL CODES, 3.6.VII
RISK MANAGEMENT
LATAM group's parent company is LATAM Airlines
Group S.A., a corporation with securities registered
in the Securities Registry of the Financial Market
Commission (CMF, for its Spanish acronym) in Chile,
and as such, an open corporation in Chile. LATAM
Airlines Group S.A.’s shares are traded on the Santiago
Stock Exchange, the Chilean Electronic Stock Exchange
and in American Depositary Receipt (ADR) form on
the New York Stock Exchange (NYSE). Therefore,
its corporate governance model is governed by the
applicable existing regulation, the Stock Market
laws (N° 18,045) and Corporations Act (N° 18,046),
the CMF rules, the US SEC regulations, and specific
regulations of the five countries where it runs
domestic operations (Chile, Brazil, Peru, Colombia
and Ecuador).
At the same time, LATAM group prioritizes the adoption
of good corporate governance practices through a
constant evaluation of available international and
national standards, considering their applicability
to its operations, which are carried out in multiple
jurisdictions and under diverse regulatory frameworks.
In this context, it has a Corporate Governance
Practices Manual, published in 2019 and recently
updated, whose purpose is to establish the corporate
governance principles governing the Board of
Directors and to make them known to the market.
This document lays the foundation for the processes
implemented for the continuous adoption of best
practices in this arena and is available to employees
on LATAM group's internal website, and on LATAM
group's public website for the market, shareholders
and other stakeholders.
Likewise, LATAM group has integrated into its
Corporate Governance Practices Manual the principles
of recognized international codes, such as the UK
Corporate Governance Code and the Principles
of Corporate Governance of the Organization for
Economic Cooperation and Development (OECD)
and of the G20, among others, such as local anti-
corruption laws. However, LATAM group does not
formally adhere to any specific code.
This strategy responds to the need to adopt a flexible
approach that will facilitate the incorporation of
effective practices aligned with the structure and
global operation. For this reason, LATAM Airlines
Group S.A. also maintains a Code of Conduct that
includes the most relevant principles of these
international and national standards, ensuring a
corporate governance model that adapts to the best
practices available and the applicable regulatory
framework in the territories where it operates.
Meanwhile, a series of corporate guidelines direct
employee behavior, in accordance with standards
of ethics, integrity, transparency, accountability,
and combating illegal acts (corruption, bribery,
antitrust, and money laundering). Along these lines,
LATAM group constantly evaluates the possibility of
implementing best practices, such as adherence to
national or international codes.
In fact, the group’s Code of Conduct applies to all
employees and collaborators of its companies, branches,
subsidiaries and offices. Indeed, the Compliance
Program, managed by the Compliance department
attached to the Legal Affairs & Compliance Vice-
Presidency, directs monitoring and control processes
and their ongoing evolution.
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
PENALTIES
NCG 519: 8. LEGAL AND REGULATORY COMPLIANCE IN RELATION
TO CUSTOMERS: 8.2 IN RELATION TO ITS EMPLOYEES AND 8.4
FREE COMPETITION , 9. SUSTAINABILITY - 9.1 SASB METRICS
SASB TR-AL-520A.1
LATAM group has internal policies in place to prevent
and detect regulatory breaches related to the rights
of its employees and customers, or that may affect
free competition. In this regard, there are a series of
trainings to prepare professionals on the specified
matters.
More information
See sections: Compliance and Ethics, Confidential Channel,
Supplier and Third Party Intermediaries (TPI) Compliance
Program.
Free Competition
It is worth noting that, during 2024, there were no
enforceable penalties or monetary losses as a result
of legal proceedings related to free competition or
unfair competition rulings against LATAM Airlines
Group S.A. or its related affiliates in Chile or abroad.
Consumer
The number of penalties enforced against LATAM
Airlines Group S.A. and/or any of its affiliates in Chile
during 2024, in relation to Law No. 19,496 on Consumer
Rights Protection, is 21. In the related affiliates in the
territories where LATAM group operates, there are 238
enforceable penalties related to legislation equivalent
to Law 19,496. The total of the penalties indicated
in this paragraph translates into CLP$758,623,645.
Labor
The number of labor penalties enforced against
LATAM Airlines Group S.A. and/or any of its affiliates
in Chile during 2024 is 17. In the related affiliates
in the territories where LATAM group operates,
there are 65 enforceable penalties. The total of the
penalties indicated in this paragraph translates into
CLP$167,494,150. Only Chile, Colombia and Brazil
were subject to labor protection actions, with no
penalties to date.
CONFLICT OF INTEREST
NCG 519: 3.1.III GOVERNANCE FRAMEWORK, 3.6.XIII
RISK MANAGEMENT AND 8. LEGAL AND REGULATORY
COMPLIANCE – 8.5 OTHERS
GRI 205-3 AND 2-15
LATAM group has an internal process to detect and
manage conflicts of interest. In fact, all candidates
for employment with LATAM group must fill out a
Conflict of Interest Statement prior to hiring. Likewise,
on a regular basis, LATAM group employees must fill
out a Conflict of Interest form each time they take
the Code of Conduct course (which is mandatory
every two years), as well as updating this document
when a potential conflict is considered.
In addition, the Code of Conduct for Third Parties and
Third Party Intermediaries establishes guidelines on
this matter for suppliers and third parties, who must
also answer a questionnaire on the subject.
It should be noted that, in the event that a potential
or actual conflict is identified, whether involving
candidates, employees or suppliers, it is reviewed
by the Compliance team and submitted to the
corresponding authorities for evaluation.
On the other hand, both employees and collaborators
of LATAM group must request prior authorization for
non-routine meetings with competitors and public
officials. This is done through the Approvals System,
which is operated by the Compliance department, by
submitting a request and an order of the day, which
must be previously approved by the Legal department.
In addition, LATAM group updated its Corporate Crime
Prevention Policy with the purpose of preventing crimes
of bribery, money laundering, financing of terrorism,
handling stolen goods, incompatible negotiations,
corruption between individuals, misappropriation and
unfair administration, among other crimes considered
in Chilean Law No. 20,393 and its amendments.
In 2024, LATAM group had no penalties related to
Law No. 20,393.
LATAM
GROUP
2024
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RELATED-PARTY TRANSACTIONS
LATAM group has a Related-Party Transactions Control
Policy applicable to the parent, all affiliates and all
members (of the Board of Directors and employees).
This was duly updated in 2024 in line with the relevant
regulatory changes and approved by the Board of
Directors. The document states that related-party
transactions must be conducted in accordance with
applicable laws, under market conditions at the time
of the transaction, and must contribute to the social
interest. Likewise, the document establishes that, where
appropriate, these transactions must be submitted
for evaluation by the Directors’ Committee and the
Audit Committee, as well as for the approval of the
Board of Directors or the Shareholders' Meeting.
In addition, on January 8, 2024, the Financial Market
Commission (CMF) published General Rule 501, which
establishes (i) the minimum conditions to be met by
the policy on ordinary related-party transactions,
to facilitate the approval of such transactions; and
(ii) the public disclosure in January and July of each
year of all related-party transactions carried out in
the immediately preceding six-month period. The
standard became effective in September 2024.
Meanwhile, on August 8, 2024, pursuant to the new
Rule 501 and upon the recommendation of the
Directors' Committee, the Board of Directors approved
amendments to (i) the Policy on Ordinary Related-
Party Transactions for LATAM Airlines Group S.A.; and
(ii) the Policy on Related-Party Transactions Control
for LATAM Airlines Group and its affiliates.
Thus, in compliance with the new Rule 501, LATAM group
issued its first report on Related-Party Transactions
(RPT). This report, as well as the aforementioned
Ordinary Transactions Policy, is available on LATAM's
website, in LATAM group’s Investor Relations section.
› 57
In turn, the consolidated Financial Statements for the
financial year ended on December 31, 2024, report
the transactions carried out in 2024 between LATAM
group and its affiliates. For more information, see
“Financial Reports” chapter.
POLITICAL CONTRIBUTIONS
NCG 519: 3.1.III GOVERNANCE FRAMEWORK
GRI 415, 3-3: 205
The main guidelines regarding political contributions
allowed by LATAM group are contained in the
Corporate Anti-Corruption Policy since 2024, after
the Political Contributions Policy released in 2016 was
repealed. Likewise, the process for validating political
contributions was merged with that of donations
within the Donations and Political Contributions
Procedure. In compliance with current local regulations
and LATAM Group’s Code of Conduct, this procedure
establishes the criteria and procedures for political
contributions—both direct and indirect—to prevent
their use as a channel for bribery, corruption or other
illicit practices. See more information in the "Annexes"
chapter, Corporate Governance section.
In financial year 2024, LATAM Airlines Group S.A.
did not make any type of contributions to political
parties, party officials or candidates for public office.
Desierto de Atacama, Chile
LATAM
GROUP
2024
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ETHICS AND COMPLIANCE
NCG 519: 3.2.IX BOARD OF DIRECTORS, 3.6.VIII RISK
MANAGEMENT AND 3.1.III GOVERNANCE FRAMEWORK
GRI 2-25, 205-2 AND 205-3
Upon joining the company, all LATAM group employees
receive training on integrity and compliance guidelines
during the induction process. In addition, the annual
training agenda for the different teams includes
topics such as ethics, corruption prevention and free
competition. There is also specific training on the
content of LATAM group’s Code of Conduct, which is
mandatory and must be revalidated every two years.
In 2016, LATAM group created the Compliance
Ambassadors Program, which aims to have Compliance
representatives in all areas of LATAM group, regardless
of the position or function they hold. They help to
disseminate the Compliance culture, guide other
employees and collaborators, identify opportunities
for improvement and guide and point out cases to
the Compliance department, when necessary. Along
COMPLIANCE PROGRAM
During 2024, 100% of the Board of
Directors, 88.3% of the Executive
Committee (COMEX), and 88.3%
of the employees have passed their
trainings on the Code of Conduct.
COMPLIANCE SYSTEMS AND PROCEDURES
⚫ Compliance as a key factor in employee
remuneration
LATAM group's Compliance system reinforces its
commitment to integrity and ethics by associating the
remuneration of certain key positions with specific
compliance-related indicators. For example, the
incentives of the Vice-Presidency of Legal Affairs
& Compliance and the Internal Audit Department
are linked to the fulfillment of specific goals. In
the case of the Internal Audit Department, part of
the short-term (annual) performance incentive is
conditioned to the improvement of internal control.
Likewise, in the Legal department, certain Compliance
indicators, such as the management of the Code of
Conduct and the Confidential Channel, are included
in the KPIs that have a direct impact on employee
compensation.
⚫ Employee performance evaluation systems
integrate Compliance and the Code of Conduct
LATAM Group's performance evaluation system
includes a competency evaluation section applicable
to all employees. In this framework, Compliance is
recognized as one of the key behaviors assessed
within the competency called "Security and Risk
Management & Compliance." Specifically, employees
are expected to display behavior that is consistent
with the Code of Conduct, as well as with the policies
and procedures affecting the safety of LATAM
group. This involves understanding that their actions
directly impact customers, processes, facilities and
the environment.
⚫ Periodic audits of the Compliance program
NCG519: 3.6.XIII RISK MANAGEMENT
During 2024, LATAM group updated its Crime
Prevention Model in order to incorporate into
LATAM group's policies and Compliance Program the
regulatory changes introduced by Chilean Law No.
21,595 (Economic Crimes Law) into Law No. 20,393
on Criminal Liability of Legal Entities. As part of
this process, the Corporate Crime Prevention Policy
was also updated and duly approved by the Board
of Directors.
It should be noted that, according to the new
regulations, certifications to the model are no longer
applicable. However, periodic audits by independent
agencies are required. Although they have not yet
been carried out due to the recent implementation of
the changes, the Corporate Crime Prevention Policy
establishes that LATAM group will carry out these
audits every two years, in line with the flexibility
allowed by law regarding their frequency.
TONE AT THE TOP
How top executives support the
implementation of the Compliance Program.
1
2
3
4
6
7
REGULATORY ENVIRONMENT
What laws and regulations apply to LATAM
group.
POLICIES AND PROCEDURES
How the periodic review and updating of
internal Policies and Procedures work.
TRAINING AND COMMUNICATION
Annual Training and Communication Plans.
MONITORING AND TESTING OF CONTROLS
How controls and monitoring function.
COMPLIANCE MANAGEMENT
Understanding how Compliance
management is structured within
LATAM group.
REPORTING
Different ways to communicate risks
to Senior Management.
5
this line, the program currently has more than 400
Compliance Ambassadors worldwide.
During 2024, 100% of the Board of Directors, 88.3%
of the Executive Committee (COMEX), and 88.3% of
the employees have passed their trainings on the
Code of Conduct.
On the other hand, based on the Compliance Program,
vendors are informed of and given the Code of Conduct
for Third Parties and Third-Party Intermediaries at
the start of the business relationship, and they must
commit to the anti-corruption clauses contained in
contracts and purchase orders.
It should be noted that there were no cases of corruption
in 2024. Likewise, LATAM uses the Foreign Corrupt
Practices Act (FCPA) definition of corruption. Within it,
an act of corruption is incurred when there is an offer,
promise, or authorization of payment, or a payment in
fact, made to a public official, with the aim to induce
the receiver to abuse their official position, regardless
of whether the corrupt act succeeds in its purpose.
LATAM
GROUP
2024
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WORKPLACE HARASSMENT AND VIOLENCE
NCG 519: 5.5 WORKPLACE HARASSMENT, SEXUAL
HARASSMENT AND VIOLENCE, 8.2 WITH REGARD TO ITS
WORKERS
GRI 406-1
LATAM group's Code of Conduct prohibits all harassing
behavior in the workplace, sexual harassment and
violence, and specifies the agencies for escalating
and reporting incidents through the Confidential
Reports Channel.
Each country where LATAM group is based has its
own workplace harassment, sexual harassment and
violence protocols. In the case of Chile, the process
is explained in the Internal Regulations for Order,
Hygiene and Safety, as required by local regulations.
In 2024, LATAM group received 61 complaints of sexual
harassment, 32.8% of which were substantiated, and
505 complaints of workplace harassment, 8.91% of
which were substantiated. All complaints were handled
in accordance with the procedures established in
each jurisdiction.
In turn, there were 11 substantiated cases of
discrimination and conflicts of interest. In response
to these cases, LATAM group began a review of
processes, created and reinforced control, auditing
and training systems as mitigation measures, and
levied sanctions under local labor regulations, as
remediation.
It is important to note that LATAM group trains
its employees on workplace harassment, sexual
harassment and violence issues, as part of its Code
of Conduct trainings. Along these lines, LATAM group
conducted a new course focused on the subject with
8,785 employees in Chile in 2024, representing 89.1%
of the total workforce. The training will remain in
place for new employees during 2025.
Effective date of Chilean Law No. 21.643
Chilean Law No. 21,643 (Karin Law) became
effective in August 2024, implying the
adaptation of the procedures of LATAM group's
companies in Chile to ensure compliance with
the provisions to strengthen the prevention,
investigation and punishment of workplace
harassment, violence and discrimination in
the workplace.
In this context, LATAM group's operation
in Chile has implemented the necessary
measures to align its internal processes with
these regulations, reinforcing its commitment
to a safe, inclusive and respectful work
environment for all its employees.
More information
Web access to LATAM group's Confidential Channel
Reports at LATAM Group in 2024
Confidential channel
NCG 519: 3.6.IX RISK MANAGEMENT
GRI 2-16, 2-25 AND 2-26
LATAM group has a Confidential Channel to receive
potential reports on breaches of laws and internal rules;
breaches of the Code of Conduct; labor irregularities;
discrimination; workplace and sexual harassment;
fraud; corruption; and bribery, among others. In fact,
LATAM group’s stakeholders can access this channel
anonymously, per local regulations, and the principle
of “non-retaliation” is guaranteed when reports are
in good faith.
When a report is made through this channel, which
is available through the Investor Relations site and
hosted on the platform of an external and non-
LATAM group provider, the complainant receives an
identification number with which they can monitor
their case. Note that the information provided only
refers to the status of the case (whether it is open,
under investigation or closed with findings of fact).
Along these lines, no information is disclosed of the
possible penalties that might be levied against the
individuals reported.
In the case of investigations, they are carried out
internally by the Compliance team, with support
from HR, Legal and any other individuals necessary.
The channel is constantly strengthened and made
known through monthly communications, trainings
carried out by the Compliance team, e-learning
and LATAM group policies. In addition, contracts
with suppliers include access to this document, as
well as to the Code of Conduct for Suppliers and
Third Party Intermediaries (TPIs) (See more in the
Suppliers chapter).
100%
OF THE REPORTS WERE ADDRESSED
FOLLOWING THE PROCEDURES ESTABLISHED
IN EACH JURISDICTION
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
CHILE REPORTS CHANNEL (Law No. 21,643)3,4
NCG 519: 5.5 WORKPLACE HARASSMENT, SEXUAL HARASSMENT AND VIOLENCE
FILED WITH THE AGENCY
FILED WITH THE MINISTRY
OF LABOR
TYPE OF REPORT
MEN
WOMEN
MEN
WOMEN
TOTAL
Workplace
harassment
3
5
2
4
14
Sexual harassment
0
0
0
0
0
Violence in the
workplace
0
4
0
2
6
Total
3
9
2
6
20
LATAM group reports channel
GRI 205-3, 406-1 AND 418-1
BRAZIL
TOTAL
SUBSTANTIATED
REPORTS
TYPE OF REPORT
REPORTS
FILED
SUBSTANTIATED
REPORTS
REPORTS
FILED
SUBSTANTIATED
REPORTS
Corruption or bribery2
3
0
3
0
0
Discrimination
8
2
141
82
84
Workplace harassment
82
16
423
29
45
Sexual harassment
15
3
46
17
20
Confidentiality of
information or privacy
policy
1
0
9
1
1
Conflicts of interest
11
1
94
10
11
Money laundering or insider
trading2
2
0
3
0
0
1 Includes Chile and other countries of Latin America, Europe, North America (US, MX, etc.), the Caribbean and Oceania.
2 Only cases among Private Individuals were received, and no cases involving Public Officials.
3 The number is based on the gender of the individual who filed the report.
4 Law No. 21,643 came into effect on August 1, 2024.
SPANISH-SPEAKING COUNTRIES
AND OTHER COUNTRIES 1
› 60
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
Employees trained in the protocol for the prevention of
sexual harassment, workplace harassment and violence
at the workplace and the procedure for investigation
and sanctions
NCG 5.5 WORKPLACE HARASSMENT, SEXUAL HARASSMENT AND VIOLENCE IN THE
WORKPLACE
PERCENTAGE (%) OF EMPLOYEES
TRAINED IN CHILE
Senior Management
82.5%
Management
83.5%
Leadership
82.1%
Operators
88.6%
Sales Force
89.9%
Administrative staff
82.7%
Other professionals
85.5%
Other technicians
94.3%
Total
89.1%
Note: LATAM group does not have any professionals in the auxiliary category.
Employees trained1 on the code of conduct 2024
NCG 519: 3.6.IX RISK MANAGEMENT
GRI 205-2
BRAZIL
CHILE
COLOMBIA
ECUADOR
UNITED
STATES2
PERU
OTHERS
LATAM
GROUP
Senior Management
93.3%
82.5%
100.0%
N/A
66.7%
100.0%
100.0%
84.8%
Management
95.4%
89.5%
89.3%
100.0%
82.4%
82.6%
85.7%
90.2%
Leadership
96.6%
87.2%
86.2%
90.3%
83.5%
84.3%
84.9%
91.0%
Operators
96.8%
79.4%
95.3%
98.1%
75.0%
88.5%
93.7%
93.2%
Sales Force
95.0%
69.3%
70.4%
100.0%
0.0%
70.2%
71.9%
80.5%
Administrative staff
98.0%
88.1%
85.7%
96.4%
100.0%
89.5%
86.8%
91.3%
Other professionals
95.4%
89.2%
94.7%
92.9%
93.4%
84.5%
91.2%
91.4%
Other technicians
96.8%
79.0%
96.2%
98.3%
100.0%
94.0%
88.6%
92.2%
Note: LATAM group does not have any professionals in the auxiliary category.
1 This percentage does not include personnel on permanent medical leave.
2 Percentage based on the personnel to whom the course is made available; i.e., direct personnel hired by LATAM group.
FUNCTIONAL CATEGORIES
⚫ Senior Management
CEOs, Vice-Presidents and directors.
⚫ Management
Senior managers, manager and assistant
managers.
⚫ Leadership
Area managers and department manager.
⚫ Operators
Cargo Operations, Maintenance, Airport and
Operations Control Center.
⚫ Sales Force
Sales Operations and Customer Care.
⚫ Administrative staff
Support activities and general roles.
⚫ Other professionals
Middle management in support activities.
⚫ Other technicians
Command and cabin crew.
Note: LATAM group has no employees under the “Auxiliary” personnel, as defined under Chile's NCG N°519.
BRAZIL
EMPLOYEES TRAINED ON THE CODE OF CONDUCT IN 2024
NCG 519: 3.6.IX RISK MANAGEMENT
CHILE
COLOMBIA
ECUADOR
PERU
OTHERS
UNITED
STATES
82.0%
94.7%
LATAM GROUP
92.2%
96.7%
97.6%
88.2%
91.3%
90.9%
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GROUP
2024
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04 / CORPORATE GOVERNANCE
RISK MANAGEMENT
NCG 519: 3.6.I, 3.6.III, 3.6.IV, 3.6.V, 3.6.VI RISK
MANAGEMENT
GRI 3-3
At LATAM Group, risk management and governance
are based on the Comprehensive Risk Management
Policy. This instrument establishes a cross-cutting
framework to address sustainability, business
continuity, customer, financial and reputational risks.
Likewise, it defines key functions and strategies
that ensure efficient management aligned with the
organization's strategic objectives.
In line with this approach, during 2024, LATAM
group presented the Board of Directors with a
commitment to strengthen this management model.
This initiative sought to raise the level of maturity
in the identification, evaluation and mitigation of
risks. At the same time, it prioritized the delivery
of more timely and relevant information to senior
management, contributing to better informed and
strategically aligned decisions.
Among the year's most noteworthy advances
was the strengthening of corporate governance,
achieved through the optimization of monitoring
and communication processes between the different
areas of LATAM group. This effort placed special
emphasis on the units in charge of managing the
most critical risks, promoting greater cohesion and
operating efficiency.
On the other hand, LATAM group made significant
progress in risk management through the incorporation
of innovative technologies that boosted the automation
and digitization of analysis processes. These tools
significantly increased efficiency and made it possible
to design more effective plans to mitigate key risks,
strengthening the capacity to respond to possible
contingencies.
Predictive analytics
A highlight of the 2024 period was the progress
in implementations of predictive analytics and
the use of data for risk management, which
represents a significant change, as well as a
great opportunity in the risk management
approach.
Predictive analytics combines internal and
external data to identify patterns and anomalies
that make it possible to foresee critical risks.
This is done using models supported by
historical information, sophisticated analytical
tools and automated reporting systems, and
incorporating emerging technologies such
as artificial intelligence (AI). An example of
this is what has been applied to risks with
reliable information for their analysis, such
as those related to operational safety. As
its development progresses, its application
is expected to be expanded to other areas
of the organization.
Roles and responsibilities
The Board of Directors is responsible for ensuring
the existence of a comprehensive risk management
process, as well as for approving related policies and
promoting a risk-oriented organizational culture.
To carry out this task, it delegates to the Directors'
Committee and the Audit Committee the supervision
of the development and evaluation of risks relevant
to LATAM group.
In turn, the Directors’ Committee and the Audit
Committee rely on the Risk Management Department
to manage the model, which involves the detection,
oversight and consolidation of the most significant
risks for the companies in LATAM group. To achieve
this, Risk Management assists and centralizes the
information gathered by the different leaders of
the various areas of LATAM group, who are directly
responsible for identifying, assessing, monitoring and
managing the risks pertaining to their corresponding
areas.
In this regard, LATAM group executives play a key
role in the identification and analysis of corporate
risks within their areas. They are responsible for
identifying singular events that may significantly
affect the fulfillment of strategic objectives. In
addition, they oversee the handling of these risks
and foster a culture of risk awareness both in their
area and throughout LATAM group.
On the other hand, LATAM group has an Internal Audit
department, which is responsible for independently
ensuring the operation, effectiveness, and compliance
with the Risk Management Model. This team, headed
by the Audit and Internal Control Director, reports
directly to the Directors' Committee and the Audit
Committee, thus ensuring an impartial and strict
monitoring of the policies implemented.
04 / CORPORATE GOVERNANCE
Meetings between Risk Management and the Board of Directors, the Directors' Committee and the Audit
Committee
NCG N°519: 3.2.VI BOARD OF DIRECTORS AND 3.3.VI BOARD COMMITTEES
PERIODICITY1
During 2024, Risk Management made two presentations to the Board of Directors and one to the Directors' Committee.
In addition, there were sessions where Risk Management participated, in which those responsible for the risks—i.e., the vice-presidents of LATAM group—made
presentations. These situations arose in the Board of Directors, Directors' Committee and in some Board Subcommittees. In all these spaces, the current status of the
risks in their care was presented, as were the strategies underway and the key issues to be addressed and managed.
MAIN TOPICS
ADDRESSED
⚫ Methodology
⚫ Risk map update
⚫ Emerging risks
⚫ Compliance with standards and regulations
⚫ Planning and resilience scenarios
⚫ Risk/mitigation strategy
⚫ Mitigators
⚫ Focal points and action plans
Meetings between Internal Audit and the Board of Directors, the Directors' Committee and the Audit Committee
NCG N°519: 3.2.VI BOARD OF DIRECTORS AND 3.3.VI BOARD COMMITTEES
PERIODICITY1
The Risk, Audit and Internal Control Director meets with the Board of Directors at least twice a year, while the Directors' Committee meets monthly.
The Vice President of Legal Affairs and Compliance participates in all meetings with the Directors' Committee.
The CFO participates in Financial Statement review meetings and other vice presidents participate according to the corporate risk review agenda.
In addition, the CEO participates in presentations to the Board of Directors.
It is worth noting that the Director of Risk, Audit, and Internal Control serves as the Secretary in meetings with the Directors’ Committee.
MAIN TOPICS
ADDRESSED
⚫ Directors Committee:
- Approval and monitoring of the annual Internal Audit Plan,
- status of SOX (Sarbanes Oxley Act) Certification Plan
- Status of relevant projects
- Status of Fraud Desk
- Other matters.
⚫ Board of Directors
- Provide an overview of Corporate Risks.
- Other matters
1 The LATAM group CEO participated in all Board meetings where risks were presented.
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Cataratas del Iguazú, Argentina-Brasil
LATAM
GROUP
2024
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2024
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THREE LINES OF DEFENSE MODEL
Using international risk management methodologies
as a benchmark, LATAM group has established a Three
Lines of Defense model to maintain an adequate
process for risk identification and mitigation.
In this structure, the first line of defense comprises
business process owners, who are primarily responsible
for identifying, assessing, managing and monitoring
their risks.
In addition, areas have been established that operate
as a second line of defense, in order to provide
specialized support and advice to business units.
These areas manage risks through the application of
specific frameworks and methodologies. For example,
the Operational Safety department does so by
following the Safety Management System (SMS); the
Sustainability Management applies double materiality
to identify, evaluate and prioritize environmental,
social, economic or corporate governance risks;
and the Information Security Management follows
standards based on ISO/IEC 27001 and NIST, among
others.
The areas in the second line of defense also carry out
inspection, verification and external audit processes.
Examples of this are the external inspections and
audits for the certification process under the IATA
Environmental Assessment (IEnvA) standard for the
subsidiaries in Brazil, Chile, Colombia, Ecuador and
Peru, as well as the system checks and stress tests
carried out by the cybersecurity team.
In addition, external audits are included for IATA
Operational Safety Audit (IOSA) certification, which
ensures that LATAM group's operations meet the
highest operational safety standards. These activities
are complemented with the assurance functions of
Internal Audit, which acts as a third line of defense.
Once the risk exposure is assessed, Risk Management
presents the information to the Board of Directors,
classified by severity level, using specific metrics
and visual tools such as heat maps and interactive
dashboards. This classification not only streamlines
the effective prioritization and assessment of risks,
but also makes it possible to identify patterns and
trends that could influence the organization's strategic
decisions. The information is delivered in a clear and
structured manner, highlighting the most critical
risks and their potential impacts on key areas such
as operations, finance, reputation and regulatory
compliance. In addition, recommendations for the
implementation of specific mitigation measures and
action plans are included, ensuring that Board members
and senior management have a comprehensive
overview to make informed decisions.
This approach allows the Board of Directors not only
to focus its efforts on the most relevant risks, but
also to align corporate strategy with risk management
plans, strengthening organizational resilience and
anticipating possible contingencies. It also fosters
greater interaction between operational areas and
leadership, ensuring that mitigation strategies are
aligned with LATAM group's long-term objectives.
LATAM group’s three lines of defense model
1
FIRST LINE 2
SECOND LINE 3
THIRD LINE
⚫ PERSON RESPONSIBLE
Business process owners.
⚫ ROLE
Directly responsible for identifying,
evaluating, monitoring and
reporting them, as well as
establishing mitigation measures
so that risks remain at adequate
levels, as defined by the Board of
Directors.
⚫ PERSON RESPONSIBLE
Risk Management and other
departments associated with
specific models, such as: Security,
Compliance, Comptrollership,
Information Security, or
Sustainability, among others.
⚫ ROLE
Provide methodological support
and specialized advice, supervise
and monitor the first line in its risk
management process.
⚫ PERSON RESPONSIBLE
Internal Audit.
⚫ ROLE
Independently evaluate the
effectiveness of the comprehensive
risk management process, as well
as the proper application of policies
and procedures.
BOARD OF DIRECTORS
FINANCE, LEADERSHIP,
STRATGY AND OTHER
COMMITTEES
DIRECTORS'
COMMITTEE
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
RISK ASSESSMENT AND MITIGATION
NCG 519: 3.6.I RISK MANAGEMENT
Integral Risk Management is an essential process
for LATAM group, making it possible to address
uncertainty by identifying risks and opportunities,
optimizing the capacity to generate value and achieve
strategic objectives. This process is continuous
and must be maintained over time, given that Risk
Management is dynamic, structured, methodical and,
at the same time, flexible to adapt to the internal
and external contexts of LATAM group. In addition,
it is strengthened by learning and experience gained
over time.
For that purpose, LATAM group has implemented a
comprehensive risk management model that uses
benchmark methodologies such as ISO 31,000 and
COSO ERM. This model focuses on the evaluation and
weighting of potential impacts and the probability
of occurrence of risks. The impact assessment
considers several dimensions, such as financial and
reputational, while probabilities are classified on a
scale from “remote” to “near certain”.
As part of this process, LATAM group defines its
risk appetite considering its corporate strategy and
level of risk aversion, establishing a framework
that balances growth and security in its decision
making. Supervised by the Board of Directors, this
appetite is defined according to the scalability of
risk management, assigning responsibilities based
on the exposure to each type of risk. Its definition
combines the impact and likelihood of occurrence
(inherent risk) with the evaluation of existing controls
(residual risk), in accordance with LATAM Group's
Risk Management Procedure.
Risk Management periodically, or at least once a
quarter, updates the exposure status of the main
corporate risks, constantly monitoring changes that
may require a new revision. This exercise incorporates
external and internal information from different
sources, including regulatory changes. The information
is consolidated in a report that is delivered to the
relevant persons in charge, facilitating its review
and coordinated management with the respective
areas involved.
It is important to note that, in 2024, Risk Management
presented an update of LATAM group's risks to the
Directors' Committee in June, and made two other
presentations to the Board of Directors in August
and December.
LATAM group also implements specific strategies
to mitigate risks and ensure operational stability.
Along these lines, in the financial arena, there is, for
example, a manual for fuel and exchange rate hedging,
which helps to reduce exposure to the variability of
these factors. Meanwhile, in the operational arena,
the organization has solid insurance coverage and
adopts proactive safety measures, such as the Safety
Management System (SMS) and the Emergency
Response Plan.
As part of these measures, LATAM group establishes
that a risk analysis be performed each time a new
operation is initiated or the conditions of an existing
operation are modified (e.g., a change of aircraft).
This analysis enables the identification of possible
undesirable conditions to implement action plans
to ensure that the operation remains within an
acceptable level of safety.
This analysis is developed through the Change
Management Analysis Procedure, which is part of
LATAM group's SMS. Its main objective is to identify
the hazards associated with changes—both internal
and external—evaluate them and establish the
necessary barriers for their implementation in the
operational areas. In this way, the aim is to mitigate
those risks that represent an unacceptable level for
the companies in LATAM group.
RISK MANAGEMENT SYSTEM CONTROL
An annual control is reviewed under the Sarbanes-
Oxley Act (SOX), which requires demonstrating risk
management that is presented to the Board of
Directors, the Directors' Committee and the Audit
Committee. This control is reviewed on an annual
basis with an external auditor (which, in 2024, was
PricewaterhouseCoopers) and the Internal Control
department, ensuring transparency and compliance
with applicable regulations.
These actions reflect LATAM group's firm commitment
to comprehensive risk management and the continuity
of its operations. Many of these initiatives are
explained in other chapters of this Annual Report.
For example, the "Employees” chapter describes
measures implemented to assess organizational climate,
benefits offered and various initiatives targeting talent
management and organizational culture. Likewise,
the "Commitment to Sustainability" chapter presents
the strategies aimed at mitigating environmental
risks. On the other hand, the "Operations", "Safety"
and "Customers" chapters describe the plans and
initiatives developed by the organization to address
operational and safety risks, among others.
It is important to note that, on an annual basis,
LATAM group presents the main risk factors both in
the 20-F Annual Report and in this Annual Report,
in the Annexes section, under the heading "Risk
Factors".
More information
In the "Annexes" chapter ("Risk Factors"), pages 238-255
LATAM Group has
implemented a comprehensive
risk management model that
uses benchmark methodologies
such as ISO 31,000 and COSO
ERM.
› 66
RISK CULTURE
NCG 519: 3.6.I RISK MANAGEMENT
LATAM Group's risk management model focuses
on strengthening the capacity to anticipate risks,
manage them the appropriately and promote a culture
that values its employees’ skills and capacities in
the face of risks, encouraging self-assessment and
prevention.
Along these lines, LATAM group actively promotes
this culture through training and outreach programs,
proactive risk identification and its inclusion in
employee performance evaluation criteria. It also
implements specific channels for risk escalation, such
as the Confidential Channel, and internal committees
such as the Executive Committee for Technological
Risks and the Operational Security Committee,
responsible for detecting and escalating technological
and operational security risks, respectively.
In 2024, two key internal campaigns were carried out
to strengthen risk management in the organization.
The first, in May, consisted of a series of posts on the
internal portal, with the aim of raising awareness among
all employees of the Integrated Risk Management
Policy. In July, through the "Líderes al Día” (Leaders
of the Day) report, a detailed analysis of the risk
policy was shared, reinforcing employees’ roles and
responsibilities in the detection, management and
mitigation of risks.
In addition, LATAM group conducted Corporate
Governance training for all its executives, which
included a specific chapter on Corporate Risks to
strengthen executives' understanding of the strategic
importance of risk management.
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04 / CORPORATE GOVERNANCE
LATAM
GROUP
2024
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2024
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04 / CORPORATE GOVERNANCE
STAKEHOLDER
ENGAGEMENT
NCG 519: 3.1.V GOVERNANCE FRAMEWORK, 3.7.I
STAKEHOLDER ENGAGEMENT, 6.1.V INDUSTRIAL SECTOR
AND 6.3 STAKEHOLDERS
GRI 2-25, 2-28 AND 3-3
LATAM group seeks to build solid, long-lasting
relationships of trust with all its stakeholders. To
this end, it prioritizes the identification of its key
audiences, the understanding of their expectations,
and the creation of connections that will allow them
to move forward together towards common goals.
Each stakeholder group is defined by LATAM group
based on its influence on operations and its ability
to impact the sustainability of the business.
See more on next page.
1
AUTHORITIES
AND
GOVERNMENT
2
1
3
4
5
6
7
8
9
TRADE
ASSOCIATIONS
INTERNATIONAL
ORGANIZATIONS
CAPITALS
MARKET
1
COMMUNITIES
EMPLOYEES
1
SUPPLIERS
CLIENTS
PRESS AND
SOCIAL MEDIA
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
AUTHORITIES AND GOVERNMENT
Definition of the regulatory framework and public
policies that influence operations.
⚫ Impactful activities: Participation in sectoral
roundtables, ensuring regulatory compliance, regulatory
reporting and collaboration in initiatives related to
operational safety and sustainability.
⚫ Mechanisms to address their interests: Ongoing
dialog with regulators, compliance with local and
international regulations, periodic reporting, and
participation in public and private forums related
to aviation policies, among others.
TRADE ASSOCIATIONS
Cooperation on common issues for the development
of the aviation sector.
⚫ Impactful activities: Active participation in
associations, contribution to the definition of industry
standards, and development of collaborative initiatives.
⚫ Mechanisms to address their interests: Technical
and regulatory contribution in sectoral committees,
participation in conferences, and collaboration in
initiatives for the development and improvement
of the industry.
INTERNATIONAL ORGANIZATIONS
Establishment of global standards and sector
benchmarks.
⚫ Impactful activities: Implementation of safety,
quality and sustainability standards defined by the
International Civil Aviation Organization (ICAO) and
the International Air Transport Association (IATA).
⚫ Mechanisms to address their interests: Collaboration
in global studies and reports, compliance with international
certifications, and attendance to strategic meetings.
CAPITALS MARKET
Access to financing and support for business
sustainability.
⚫ Impactful activities: Publication of financial and
non-financial results.
⚫ Mechanisms to address their interests: Transparency
in financial and non-financial information, meetings
with analysts and participation in roadshows with
investors.
COMMUNITIES
Generation of shared value with localities in the
five countries where LATAM group has domestic
operations.
⚫ Impactful activities: Proper management of
potential external impacts (social, environmental
and health), support in emergency situations, and
collaboration in social and environmental initiatives.
⚫ Mechanisms to address their interests: Adherence
to high environmental, social and governance (ESG)
standards, mapping and management of potential
impacts on the environment, and Shared Value
programs (Avion Solidario).
EMPLOYEES
Fundamental pillar of the business, essential for
operations and service.
⚫ Impactful activities: Job generation, implementation
of professional development and training programs,
and promotion of good working conditions.
⚫ Mechanisms to address their interests: Application
of work climate surveys, strengthening of internal
communication channels, implementation of training
programs and benefits, as well as occupational safety
and wellness initiatives.
SUPPLIERS
Strategic business relationships to ensure operational
continuity.
⚫ Impactful activities: Selection and evaluation
processes, fulfillment of payment deadlines and
ensuring operational continuity.
⚫ Mechanisms to address their interests: Direct
and indirect communication channels, meetings with
strategic suppliers and monitoring compliance with
contractual payments.
CLIENTS
Focus on offering a reliable and satisfactory passenger
experience.
⚫ Impactful activities: Guaranteed service quality,
punctuality and security, together with an efficient
management of claims and adequate protection of
personal data.
⚫ Mechanisms to address their interests: Conducting
satisfaction surveys, continuous development of
innovative solutions to improve customer experience,
multi-channel support and implementation of
Information Security policies and plans.
PRESS AND SOCIAL MEDIA
Management of requests and communication of
milestones through the External Communications
Department(ComunicacionesExternas@latam.com).
⚫ Impactful activities: Press releases, conferences
and media interviews.
⚫ Mechanisms to address their interests:
Liaison with journalists, delivery of information in
a transparent and clear manner, as well as regular
updates on the business.
1
2
3
4
5
6
7
8
9
LATAM
GROUP
2024
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04 / CORPORATE GOVERNANCE
CHILE
Asociación Chilena de Aerolíneas (ACHILA)
Asociación Latinoamericana y del Caribe de Transporte Aéreo
(ALTA)
Cámara Chileno Norteamericana de Comercio (Amcham – Chile)
Cámara de Comercio de Santiago (CCS)
Federación de las Empresas de Turismo de Chile (Fedetur)
Fundación Chilena del Pacífico
Instituto Chileno de Administración Racional de Empresas
(ICARE)
Global Compact
Sociedad de Fomento Fabril (SOFOFA)
COLOMBIA
Asociación de Líneas Aéreas Internacionales en Colombia
(ALAICO) – Carga
Asociación de Transporte Aéreo de Colombia (ATAC)
Asociación Nacional de Empresarios de Colombia (ANDI)
Federación Nacional de Comerciantes (FENALCO)
ECUADOR
Cámara de Industrias de Guayaquil
Cámara de Industrias y Producción (CIP)
Club 30% (OPEV)
American Chamber of Commerce
Global Compact
Cámara Ecuatoriano Alemana
FIDEICOMISO YPO ECUADOR
YPO-WPO INTERNATIONAL
MEMBERSHIP IN ASSOCIATIONS
NCG 519: 6.1.VI INDUSTRIAL SECTOR AND 6.3
STAKEHOLDERS
GRI 2-28
LATAM group participates, through memberships, in
representative agencies that promote initiatives for
strategic debate and the joint construction of solutions.
It also collaborates in the discussion of public policies
and regulations relevant to the sector. In fact, in
2024, financial contributions to the different agencies
totaled US$1,545,987. All of these amounts went
to trade associations, with the largest contributions
going to Associação Brasileira das Empresas Aéreas
(Abear), which received USD$909,733; Asociación
Latinoamericana de Transporte Aéreo (ALTA), which
received US$90,160; and Asociación Chilena de
Aerolíneas (ACHILA), which received USD$62,000.
More information
in Chapter "Annexes" under Corporate Governance, page 216.
BRASIL
Associação Brasileira das Empresas Aéreas (Abear)
Associação Brasileira das Empresas de Mercado de Fidelização
(Abemf)
Associação Brasileira de Comunicação Empresarial (Aberje)
Câmara Americana de Comércio para o Brasil (Amcham Brasil)
G100 Brasil (G100 Brasil)
Junta dos Representantes das Companhias Aéreas
Internacionais do Brasil (Jurcaib)
Sindicato Nacional das Empresas Aeroviárias (Snea)
Asociación Latinoamericana de Transporte Aéreo (ALTA)
Centro Indústria do Estado de São Paulo (CIESP)
PERÚ
Asociación de Empresas de Transporte Aéreo Internacional
(AETAI)
Confederación Nacional De Instituciones Empresariales Privadas
(CONFIEP)
Asociación Peruana de Empresas Aéreas (APEA)
Cámara de Comercio Americana del Perú (AMCHAM PERÚ)
Cámara Nacional de Turismo (CANATUR)
Cámara Regional de Turismo de Cusco (CARTUC)
Instituto Peruano de Economía (IPE)
Perú Sostenible
Sociedad de Comercio Exterior del Perú (COMEX PERÚ)
Asociación Peruana de Hidrógeno (H2 PERÚ)
REF: CEO advisory boards
Patronato Hombro a Hombro
Asociación Femenina de Ejecutivas de Empresas Turísticas
Grupo Pro Amazonía
ARGENTINA
Cámara de Compañías Aéreas en Argentina (JURCA)
LATAM
GROUP
2024
› 70
04 / CORPORATE GOVERNANCE
FINANCIAL POLICIES
FINANCING POLICY
LATAM Airlines Group S.A. also has a Financial Policy
and the Corporate Finance Department is responsible
for designing, implementing and supervising it. This
policy makes it possible to effectively respond to
changes in the environment, and conditions under
which LATAM group operates, maintaining a stable
flow of funds to ensure the operation’s continuity
and sustainable growth, and the fulfillment of its
financial obligations.
Moreover, the Finance Subcommittee, comprising
the Executive Vice-Presidency and members of the
Board of Directors, meets periodically to evaluate
the financial situation of LATAM Airlines Group S.A.
and its compliance with this Financial Policy, and to
propose to the Board the approval of said policy,
and bring up issues that are not regulated by the
Financial Policy.
During 2024, the solid financial achievements in
recent years prompted LATAM Airlines Group S.A.
to review its Financial Policy, with the purpose of
strengthening the clear framework for action on its
capital allocation. These achievements include strong
cash flow generation, a significant reduction in debt,
a decrease in financing costs due to the successful
2024 refinancing, and a substantial improvement
in credit ratings from Moody's, S&P and Fitch. The
process of revising this policy was discussed at several
Board meetings, culminating in a renewed framework
that integrates previous principles with more specific
and strategic guidelines to govern future decisions.
In line with this financial policy, LATAM management
and its Board of Directors recurrently analyze
alternatives for an additional capital return program
for shareholders including, among other possible
options, incremental dividends, share repurchases
and/or growth capital and strategic investments
for an effective allocation of capital in 2025 and
beyond. Along this line, the new Financial Policy
of LATAM Airlines Group S.A. is structured around
three fundamental pillars, namely: i) maintaining a
solid balance sheet position; ii) financing profitable
and attractive growth; and, iii) improving shareholder
returns, integrating both recent achievements and
the essential principles of the previous policy.
Maintaining a strong balance sheet position
⚫ Optimize the cost of debt through refinancing,
aiming to achieve a BB+/Ba1 credit rating.
⚫ Maintain an adjusted net leverage level below 2.0x.
⚫ Preserve adequate cash levels to guarantee
operations, growth and compliance with financial
obligations, striving towards a liquidity between
21% and 25%.
Investment in profitable and attractive growth
⚫ Finance new discretionary projects with high returns
on investment.
⚫ Renew the fleet with new technology aircraft
to improve operational efficiency and customer
experience.
Improve shareholder returns
⚫ Distribute at least the mandatory minimum of
30% of the previous year’s annual net income as
dividends.
⚫ Evaluate additional increases in shareholder returns
based on financial performance.
In addition to the pillars mentioned above, the
new Financial Policy of LATAM Airlines Group S.A.
includes key dimensions that were already part of its
previous structure, but which remain fundamental
to its management. These points are:
⚫ To reduce the effects of market risks, such as
variations in fuel prices, exchange rates, and interest
rates, on the net margin and cash position of LATAM
Airlines Group S.A.
⚫ To maintain a suitable level of credit lines with
local and foreign banks to gain access to additional
liquidity to face contingencies.
⚫ To manage counterparty risk through the diversification
and limits on investments and transactions with
counterparties.
⚫ To maintain visibility of the projected financial
situation of LATAM Airlines Group S.A. in the short,
medium, and long term, anticipating possible scenarios
of low liquidity or deterioration of financial ratios.
⚫ To capitalize excess cash flow through financial
investments that will guarantee a good balance
between risk and liquidity levels, consistent with
the Financial Investment Policy.
⚫ To provide clear guidelines and restrictions to manage
Liquidity and Financial Investment transactions,
Financing Activities, and Market Risk Management.
During 2024, the solid financial
achievements in recent years
prompted LATAM Airlines Group S.A.
to review its Financial Policy, with the
purpose of strengthening the clear
framework for action on its capital
allocation.
04 / CORPORATE GOVERNANCE
FINANCIAL POLICY
LATAM Airlines Group S.A. has a Financing Policy
whose scope is to meet LATAM group’s financing needs,
including working capital financing, the acquisition
of fleet assets, such as aircraft and engines, and
the financing of other investments.
During 2024, LATAM Airlines Group S.A. had access
to the international capitals market, issuing a US$1.4
billion note at an interest rate of 7.875% and a 5.5-year
maturity. These funds were fully used to prepay a
significant portion of the non-fleet debt. Specifically,
the instruments that were prepaid with this issuance
correspond to the Term Loan B Facility for US$1,081
million and the 2027 Note for US$450 million, which
were fully prepaid. For this prepayment, LATAM
Airlines Group S.A. used US$200 million of its cash
reserves. As a result of this, LATAM Airlines Group
S.A. estimated annual savings from lower interest
payments of approximately US$120 million and a
one-off impact on the company's Income Statement
of approximately US$134 million, US$45 million of
which were cash impacts during the fourth quarter
of 2024.
Additionally, by December 31, 2024, LATAM Airlines
Group S.A. had three committed revolving lines
for a total of US$1.85 billion. One was for US$800
million, another for US$750 million and another for
US$300 million.
It is important to mention that the first two lines
are fully available. The former is secured by and
subject to the availability of collateral (such as
aircraft, engines and spare parts), while the latter
is secured by certain intangible assets of LATAM
Airlines Group S.A., which share collateral with
outstanding international notes. Meanwhile, the
third line is partially drawn and is backed by spare
engines, with US$25 million remaining available to
LATAM Airlines Group S.A. Thus, the total available
between the three committed lines amounts to
US$1,575 million.
Most of the recurring investments made by LATAM
Airlines Group S.A. are related to the fleet acquisition
programs. Normally, LATAM Airlines Group S.A.
finances between 80% and 95% of the value of the
assets through bank loans, notes covered by the
export promotion agencies, or covered bonds, where
the remaining part is funded through commercial
loans, capital investments, or the Company’s own
funds. However, during the last few years, LATAM
Airlines Group S.A. has been able to finance up to
100% of the value of the assets thanks to its excellent
credit capacity recognized by the market.
Meanwhile, the payment maturities of the various
aircraft financing structures are mostly for 12 years.
In addition, LATAM Airlines Group S.A. contracts a
large part of its fleet purchase commitments through
operating leases as an additional source of financing.
During 2024, LATAM Airlines Group S.A. financed the
acquisition of aircraft via a combination of structures,
commercial loans, operating leases, and own funds.
It is worth mentioning that another of the Financing
Policy’s objectives is to ensure a stable debt maturity
and leasing commitment profile, including debt
servicing and payments on fleet leasing consistent
with the operating cash flow of LATAM Airlines
Group S.A.
GRUPO
LATAM
2024
› 71
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
LIQUIDITY POLICY
The main purpose of LATAM Airlines Group S.A. is
to maintain an adequate liquidity position that will
allow it to face potential external shocks, as well
as to mitigate the effects of volatility and cycles
inherent to the industry in which it operates. Along
this line, it also has a Liquidity Policy, which seeks
to guarantee financial stability and support the
long-term sustainability of operations.
At year-end, LATAM Airlines Group S.A. reported
total liquidity of US$3,533 million, comprised of
US$1,958 million in cash and cash equivalents, and
US$1,575 million in three fully available lines of
credit, per its Financial Policy. This translates into
a liquidity indicator of 27.1%.
In this context and in line with the solid cash flow
generation observed in 2024, LATAM Airlines Group
S.A. is evaluating the best use of excess cash based
on its Financial Policy prioritizing the allocation of
capital, to maintain a solid balance sheet within
the levels of the Financial Policy, make strategic
investments and generate shareholder value, aligned
with the objectives of financial sustainability and
profitable growth.
FINANCIAL INVESTMENT POLICY
At the same time, LATAM Airlines Group S.A. has
a Financial Investment Policy, whose main purpose
is to centralize investment decisions to optimize
profitability adjusted for exchange rate risk, while
maintaining an proper level of security and liquidity.
Moreover, it aims to mitigate risks through the
diversification of counterparties, maturities, currencies,
and instruments.
In this regard, in 2024, LATAM Airlines Group S.A.
witnessed a downward trend in interest rates, reflecting
a shift in global monetary policies. This contrasts
with 2023, a year marked by high rates due to the
upward adjustment cycle initiated in previous years.
› 72
LATAM
GROUP
2024
› 73
04 / CORPORATE GOVERNANCE
MARKET RISK MANUAL
Due to the nature of its operations, LATAM Airlines
Group S.A. is exposed to market risks such as: i) fuel
price risk; ii) interest rate risk; and iii) exchange rate
risk. However, it operates with financial derivatives to
hedge all or part of the risks and reduce the adverse
effects that they could generate.
Along this line, market risk is managed holistically
and considers the correlation with each market factor
to which LATAM Airlines Group S.A. is exposed.
I. Fuel price risk
LATAM Airlines Group S.A. buys aircraft fuel, known
as jet fuel. However, for the execution of fuel hedges,
a benchmark index is used in the international market
for this underlying asset: Jet Fuel 54 US Gulf Coast.
In addition, LATAM Airlines Group S.A. has the ability
to trade in derivatives based on Jet Fuel, as well as
other underlying assets, such as Jet Fuel, Brent, WTI
and Heating Oil.
Likewise, variations in fuel prices depend largely on
factors such as global oil supply and demand, as well
as the decisions made by the Organization of the
Petroleum Exporting Countries (OPEC), the refining
capacity worldwide, available inventory levels, the
occurrence of climatic phenomena or geopolitical
factors.
In this context, LATAM Airlines Group S.A. has
developed a Fuel Hedging Manual, which establishes
a minimum and maximum range for fuel consumption
hedging in different time frames. This range is
determined by aspects such as the capacity to pass
on price variations to fares, sales anticipation and
the competitive context, among other factors.
In addition, this Manual defines the areas of
coverage, the premium budget and other strategic
considerations. These are periodically evaluated and
presented to the LATAM Airlines Group S.A. Finance
subcommittee for review.
Last, with regard to the instruments used for fuel
hedging, the Manual allows the use of Swaps and
Combined Options to mitigate the risks associated
with price fluctuations.
II. Interest rate risk on cash flows
The existing uncertainty regarding market behavior,
government and central bank policies and, therefore,
the evolution of interest rates, generates a risk mainly
associated with the debt of LATAM Airlines Group
S.A.—especially debt subject to variable interest
rates—as well as the investments it holds. This
is because the risk derived from interest rates on
current debt materializes as the impact on future
cash flows related to financial instruments. Thus,
an increase in interest rates could translate into a
higher cash flow from interest payments, and vice
versa.
LATAM Airlines Group S.A.’s exposure to the risk from
market interest rate fluctuations is closely linked to
long-term obligations with variable rates, mainly.
On the other hand, the variation in interest rates is
strongly influenced by the state of the global and
local economy in each country where LATAM group
operates. A change in the long-term economic outlook
could alter rates, in addition to possible government
interventions that could increase or reduce them,
among other measures adopted in response to
specific situations or to manage inflation targets.
Therefore, in order to mitigate the impact of a
possible increase in interest rates, LATAM Airlines
Group S.A. may resort to the use of interest rate
swaps, swaptions or other financial derivatives.
LATAM
GROUP
2024
04 / CORPORATE GOVERNANCE
III. Exchange rate risks
The functional currency used by LATAM Airlines
Group S.A. is the U.S. dollar, and there are two types
of risks associated with the exchange rate: cash flow
risk and balance sheet risk.
Cash flow risk is a consequence of the net revenue
position and costs denominated in currencies other
than the U.S. dollar. In this sense, LATAM Airlines
Group S.A. sells its services in both U.S. dollars and
in local currencies. In the international passenger
business, most of the fares are based on the U.S.
dollar, while a smaller proportion is based on the
euro. On the other hand, in its domestic businesses,
most fares are found in local currency.
As for expenses, some of them are denominated in
U.S. dollars or in currencies equivalent to the U.S.
dollar, such as fuel and aircraft leases. Instead,
other expenses, such as remuneration, are mainly
denominated in local currencies.
Thereby, LATAM Airlines Group S.A. is exposed to
the fluctuations in various currencies—mainly, the
Brazilian real. In fact, up to December 31, 2024, LATAM
Airlines Group S.A. held hedges for the Brazilian real
totaling USD$180 million for 2025.
On the other hand, balance sheet risk arises when
the items recorded in the balance sheet are exposed
to exchange rate variations. This happens because
these items are expressed in a monetary unit other
than the functional currency and must be translated
into the relevant functional currency. In this context,
the main mismatch factor occurs in LATAM Airlines
Brasil S.A., whose functional currency is the Brazilian
real, and most of whose assets and liabilities are
denominated in U.S. dollars. This difference has
a direct impact on the income of LATAM Airlines
Group S.A. in the event of changes in the value of
the Brazilian real.
While LATAM Airlines Group S.A. may sign hedging
derivatives contracts to protect against the impact
of a potential currency appreciation or depreciation
vs. the functional currency used, during 2024, no
hedges were made against balance sheet risk.
› 74
LATAM
GROUP
2024
› 75
05 / OPERATIONS
05
_OPERATIONS
77 PASSENGER OPERATIONS
79 CARGO OPERATIONS
83 JOINT VENTURE WITH DELTA AIR LINES
84 FLEET
LATAM
GROUP
2024
› 76
05 / OPERATIONS
PASSENGER
OPERATIONS IN 2024
CARGO OPERATIONS
IN 2024
MILLION PASSENGERS
TRANSPORTED
82
OPERATIONS
NCG 519: 6.1.I INDUSTRIAL SECTOR AND 6.2.I BUSINESSES
COUNTRIES
27
DESTINATIONS
151
THOUSAND TONS
TRANSPORTED
998
COUNTRIES, 4 CARGO-ONLY
DESTINATIONS
DESTINATIONS, 12 CARGO-ONLY
DESTINATIONS
31
163
1RPK: Acronym for “revenue passenger-kilometers”.
2ASK: Acronym for “available seat kilometers”.
3RTK: Acronym for “revenue ton-kilometers”.
4ATK: Acronym for “available ton-kilometers”.
+16.8%
vs. 2023
CONSOLIDATED
TRAFFIC (RPK1)
CAPACITY (ASK2)
vs. 2023
+15.1%
vs. 2023
vs. 2023
CONSOLIDATED
TRAFFIC (RTK3)
+16.9%
CAPACITY (ATK4)
+12.5%
05 / OPERATIONS
PASSENGER OPERATION
NCG 519: 6.1.II SECTOR INDUSTRIAL
GRI 3-3, 2-1 AND 2-6
In 2024, LATAM group transported more than 82
million passengers—an 11.0% increase from the
previous year. Meanwhile, capacity, which is measured
in ASK (acronym for “available seat-kilometers”),
grew by 15.1% compared to 2023.
BRAZIL
Domestic operations in Brazil reached an ASK (acronym
for “available seat-kilometers”) capacity 7.1% higher
in 2024 vs. the previous year, transporting a total of
34.8 million passengers. On the other hand, demand,
measured in RPK (acronym for “revenue passenger-
kilometers”), grew 9.1% vs. 2023, with a load factor
of 82.4%—1.5 percentage points higher than in the
previous year.
SPANISH-SPEAKING COUNTRIES
In turn, in theSpanish-speaking countries (Chile,
Colombia, Ecuador and Peru), domestic supply
measured in ASK (acronym for “available seat-
kilometers”) grew 11.4%, while demand measured in
RPK (acronym for “revenue passenger-kilometers”)
increased 11.8% during 2024. At the same time, load
factor was 82.3%, 0.3 percentage points higher than
in 2023. In addition, a total of 31.1 million passengers
were transported.
INTERNATIONAL MARKET
On the other hand, in the international market, which
considers flights within the Americas (North, Central
and South America) and to three other continents
(Africa, Europe and Oceania), the supply for LATAM
group passengers, measured in ASK (acronym for
“available seat kilometers”), increased by 21.7% in
2024 compared to 2023, while passenger demand,
measured in RPK (acronym for “revenue passenger-
kilometers”) rose by 23.4% during the same period.
Within this framework, 16 million passengers flew
to international destinations in 2024, reaching a
load factor of 86.1%—1.2 percentage points higher
than in 2023.
NEW ROUTES
In 2024, LATAM introduced 23 new routes: 10
international, 8 domestic in Brazil and 5 in Spanish-
speaking countries (Chile, Colombia, Ecuador and
Peru). These include the restart of the flight between
Santiago (Chile) and Sydney (Australia)—the longest
route in its network—allowing passengers to complete
the journey in less than 15 hours without stopovers,
as well as the direct flight between Lima (Peru) and
Montego Bay, Jamaica’s main tourist destination.
› 77
GRUPO
LATAM
2024
DETAILS BY AFFILIATE AS AT 2024
NCG 519: 6.1.II INDUSTRIAL SECTOR
BRAZIL
52
Domestic
destinations
39%
Market
share
Main competitors
Gol and Azul
17
COLOMBIA
Market
share
Domestic
destinations
18
29%
Domestic
destinations
Market
share
ECUADOR
7
45%
PERU
17
Domestic
destinations
64%
Market
share
CHILE
Market
share
Domestic
destinations
63%
Main competitors
SKY Airlines and JetSMART
Main competitors
Avianca, JetSMART, EasyFly, Satena and
Copa Airlines Colombia (Wingo)
Main competitors
Avianca and Aeroregional
Main competitors
SKY Airlines Peru, JetSMART, Atsa
Airlines and Star Peru
Source: ANAC website (Brazil) and market share considers RPKs as at December 2024.
Source: JAC website (Chile) and market share considers RPKs as at December 2024.
Source: DGAC website (Peru) and market share considers the number of passengers as at
December 2024.
Source: Diio.net and market considers ASK as at December 2024.
Machu Picchu, Peru
› 78
GRUPO
LATAM
2024
05 / OPERACIONES
› 79
05 / OPERATIONS
LATAM
GROUP
2024
1 2 3 4
CARGO OPERATION
GRI 2-6, 3-3 AND 203-2
The strategy of LATAM group’s cargo affiliates is
aimed to position them as the preferred option for
transportation to, from and within Latin America,
ensuring high safety standards and a competitive
cost structure.
Along this line, the spotlight to strengthen customer
preference is based on reliability, convenience and
the building of relationships that drive joint growth.
On the other hand, cost competitiveness is based
on high productivity levels, efficient fleet utilization
and capacity optimization. In addition, LATAM group
prioritizes agility to adapt to changes in demand
and market needs, combining robust management
processes with a close relationship with its customers.
In terms of risk management, LATAM group’s cargo
affiliates focus on key challenges such as shocks on
demand, shifts in competition and excessive customer
concentration. In this regard, they participate actively
in LATAM group’s Risk Board, where risks are assessed
and mitigated on a quarterly basis, ensuring the
adaptation of the business and achievement of its
strategic goals.
METRICS AND OBJECTIVES
For LATAM group’s cargo affiliates,
the main goals are established
quantitatively in the second quarter
of each year and cover four key
areas:
Business profitability
and return on
investment in the
cargo fleet
Customer
preference
Service quality
Sustainability
These indicators are monitored on a
quarterly basis to ensure compliance
with goals, but they are also reviewed
on a monthly basis in greater detail.
05 / OPERATIONS
NCG 519: 6.1.I INDUSTRIAL SECTOR
LATAM group’s cargo operations, which represent
12.3% of consolidated revenues, stand out for their
broad network coverage and density, as well as
their expertise in cargo handling and care. Among
the most relevant products transported are flowers,
fish and fruits in exports from the region, as well
as technological products, critical spare parts and
pharmaceutical products in imports to the region.
In absolute terms, throughout 2024, 998 thousand
tons of cargo were transported, translating into an
increase of 5.6% compared to the figure reported
in 2023. Meanwhile, cargo revenues increased by
12.2% in the period compared to 2023. At the same
time, load factor was 53.7%, while cargo capacity,
which is measured in ATK (acronym for “available
ton-kilometers”), increased by 12.5% vs. 2023.
On the other hand, during 2024, LATAM group increased
its capacity on the Europe-South America route
with the addition of two new weekly frequencies,
totaling 12 frequencies. In Chile, LATAM group began
operations at the Fast Export warehouse, one of the
three export terminals in Santiago, after obtaining
the corresponding concession.
These advances reflect the commitment of LATAM
group’s cargo operators to innovation and excellence
in their services, strengthening their network and
improving their customer experience.
LATAM group’s cargo affiliates are
strategic players in Latin American
trade and supply.
› 80
LATAM
GROUP
2024
05 / OPERATIONS
CERTIFICATIONS
Since 2022, LATAM group has been a pioneer in the
global industry by obtaining the Center of Excellence
for Independent Validators (CEIV) certification for
Lithium Batteries, awarded by the International Air
Transport Association (IATA).
This certification guarantees the safe handling and
transportation of lithium batteries throughout the
supply chain, given their high combustibility. In fact,
the transportation process must meet stringent
international standards ranging from manufacturing,
testing and packaging to labeling and the corresponding
documentation.
In this context, LATAM group’s cargo affiliates
successfully passed the audit process, confirming
the quality of their controls and risk mitigation
measures, which also apply to passenger operations.
Moreover, since 2017, LATAM group has also held
IATA’s CEIV Pharma certification, which ensures
the integrity of pharmaceutical products during
transport, especially those requiring temperature
control. In fact, LATAM group’s cargo operators and
its warehouse in Miami (United States) recently
renewed this certification, meeting the highest quality
standards. This warehouse was also recertified in
October 2024 under ISO 14001:2015.
In addition, expanding its scope, the Fast Air import
warehouse in Santiago (Chile) became CEIV Pharma
certified, consolidating its position as a reliable
partner in the transportation of pharmaceuticals to
Chile and guaranteeing compliance with the strictest
standards of safety and reliability.
SECURITY MEASURES
LATAM group’s cargo operators have procedures
in place to ensure the integrity of operations and
compliance with international regulations, avoiding
the transport of weapons, drugs, or unauthorized
species. Some of the main measures implemented
are:
⚫ Pre-Loading Advance Cargo Information
(PLACI):
It makes it possible to provide detailed information on
cargo prior to shipment, enabling early identification of
risks in compliance with European Union requirements.
⚫ Air Cargo Advance Screening (ACAS):
This requires advance submission of cargo security
data to U.S. authorities, allowing for pre-shipping
risk analysis.
⚫ ACC3 Certification:
It ensures that airlines transporting cargo into the
European Union from third-country airports comply
with strict security standards.
⚫ Cargo Inspections:
Detailed inspections are performed using certified
technology such as X-ray, explosive trace detection
(ETD) equipment and K9 teams.
⚫ Access Control and Surveillance:
It ensures that only authorized personnel have access
to loading areas through the use of access badges
(TILAN), surveillance cameras (CCTV) and controlled
security perimeters.
⚫ Security Audits:
Regular audits are carried out to evaluate and tighten
the security measures implemented.
⚫ Staff Training:
The personnel of LATAM group’s cargo operators
is trained to identify suspicious items, implement
security procedures and handle emergencies.
In addition, the company works closely with suppliers
to prevent risky shipments.
⚫ Collaboration with Authorities and Agencies:
LATAM group’s cargo operators work alongside local
and international authorities to share information and
ensure compliance with global security regulations.
With these measures, LATAM group’s cargo operators
reinforce their commitment to safety, positioning
themselves as a benchmark of reliable and safe
freight transportation.
› 81
LATAM
GROUP
2024
SUPPORT TO EXPORT INDUSTRIES IN SOUTH AMERICA
Market shares
GRI 203-2
Source: WorldACD, including affiliates ABSA, LANCO, LATAM Cargo and LATAM group’s passenger affiliates up to 2024.
Pharmaceutical shipments
Due to its sound specialized network, in 2024, LATAM group’s cargo affiliates
managed to transport 34% more pharmaceutical shipments, representing a 22%
increase in “ pharma tons” compared to 2023.
Likewise, thanks to coordination with clients, authorities and suppliers, LATAM group’s
cargo operators opened a new route in Chile to transport radiopharmaceuticals.
This is intended to support cancer diagnoses, marking an important step forward
in its commitment to the health sector.
BRAZIL
CHILE
94%
of fish
of fish
28%
of fruits and
vegetables
54%
75%
of fruits and
vegetables
COLOMBIA ECUADOR
PERU
44%
of flowers
71%
of flowers
55%
of fruits and
vegetables
Galapagos, Ecuador
› 82
COMPETITIVE ENVIRONMENT
6.1.ii INDUSTRIAL SECTOR
The cargo business in the region is highly competitive, as
international and regional carriers often have available
capacity in their cargo operations. In the region, LATAM
group has been able to maintain solid market shares
through efficient fleet and network utilization.
The main competitors can be divided into three categories:
1. Hybrid airlines, which operate mixed fleets of belly
and freighter aircraft, such as Air France-KLM-MartinAir,
Lufthansa, Qatar, Ethiopian, Korean Airlines and Avianca.
2. Pure freight carriers, such as Atlas and Cargolux.
3. Carriers that only use belly-plane cargo holds, such
as IAG Group (British Airways, Iberia and its affiliates),
American Airlines and United Airlines.
05 / OPERACIONES
LATAM
GROUP
2024
LATAM
GROUP
2024
05 / OPERATIONS
⚫ Capacity growth:
Capacity (ASK, which stands for “available seat
kilometers”) increased by 19% in 2024 vs. 2023,
driven by growth on existing routes and the launch
of the new Santiago (Chile) - Orlando (United States)
route, operated by LATAM group.
⚫ Improved travel experience:
Several initiatives were implemented to optimize
customer experience, such as seat selection on flights
operated by Delta Air Lines and marketed by LATAM
group, the opening of Joint Venture Desks (JV Desks)
at major airports and in-flight recognition of Top Tier
passengers in frequent flyer programs (passengers
with categories such as Platinum, Black, and Black
Signature within the LATAM Pass program).
In 2024, significant strategic progress was made in
the framework of the joint venture between LATAM
group and Delta Air Lines, which has celebrated
its second year. Some of the most outstanding
milestones are:
⚫ Expansive connectivity for customers:
Access to over 300 destinations between the United
States/Canada and South America.
⚫ Broader reach:
In February 2024, Ecuador and the cargo business
were added to the scope of the joint venture,
significantly improving connectivity between South
America (Brazil, Chile, Colombia, Ecuador, Paraguay,
Peru and Uruguay) and North America (Canada and
the United States).
JOINT VENTURE WITH DELTA AIR LINES
GRI 2-6
trips
32,000
seats
8 MILLION
passengers transported
5 MILLION
PERCENTAGE OF SHARED CAPACITY1
NEW ROUTES LAUNCHED
São Paulo (Brazil) - Los Angeles (USA)
Bogota (Colombia) - Orlando (USA)
Lima (Peru) - Atlanta (USA)
Santiago (Chile) - Orlando (USA)
LATAM Group
Delta Air lines
Atlanta (USA) - Cartagena (Colombia)
New York (USA) - Rio de Janeiro (Brazil)
1 Based on ASKs (acronym for “available seat-kilometers”) and calculated in the countries where the joint venture operates, which
include Brazil, Canada, Colombia, Chile, Ecuador, the United States, Paraguay, Peru and Uruguay. Ecuador is included in the 2023
base for comparative purposes. / Source: Diio.net.
37%
+4 pp vs 2023
› 83
05 / OPERACIONES
LATAM
GROUP
2024
05 / OPERATIONS
FLEET
GRI 3-3
SASB TR-AL-000.F
By December 31, 2024, LATAM group’s fleet consisted
of 347 aircraft used for both passenger and cargo
operations. It has a fleet of wide-body aircraft for
international flights and a fleet of narrow-body
aircraft for regional operations in South America, in
addition to a dedicated cargo freighters.
FLEET RENEWAL
In 2024, LATAM group continued to make progress on
its commitment to have a fleet prepared to offer a
safer, more comfortable and efficient travel experience.
Thus, during the period, it incorporated a Boeing
787-9 wide-body aircraft, a last-generation model
that emits 20% less CO2 than an average aircraft of
previous generations, according to its manufacturer’s
data. It also incorporated two additional wide-body
aircraft under short-term leases.
Likewise, LATAM group acquired six A320neo and
seven A321neo—models that are equipped with
more fuel-efficient technology compared to older
versions, and therefore have lower associated carbon
emissions. In fact, according to the manufacturer’s
data, both are 20% more fuel efficient and reduce
their acoustic footprint by at least 50% compared
to previous generations.
The group also added a Boeing 767-300F freighter
to its fleet in 2024, through the conversion of a
passenger aircraft, a model with a modern air-
conditioning system for transporting perishable
products, enhancing versatility and efficiency in
freight transportation.
Along this line, overall, LATAM group’s new fleet
reflects the company’s commitment to efficiency and
innovation in sustainability, prioritizing investment in
modern aircraft that contribute favorably to climate
change mitigation in the aviation industry.
Sixteen aircraft were received in
2024, 3 of which are wide-body
and 13 are narrow-body.
268
NARROW- BODY
58
WIDE -BODY
21
CARGO
› 84
Approx. US$1.50 billion in unencumbered assets
(including additional aircraft and engines)
AIRCRAFT
11.97
Average fleet age
347
LATAM
GROUP
2024
05 / OPERATIONS
MAINTENANCE
Aircraft maintenance, planning, and return activities
across LATAM group are performed primarily at
Maintenance, Repair, and Operation (MRO) bases in
São Carlos (Brazil) and Santiago (Chile), which also
offer services to third parties. Along these lines,
these facilities, which are equipped and certified
to serve Airbus and Boeing fleets, provided 88% of
all heavy maintenance services required by LATAM
group, totaling 1.54 million man-hours.
The São Carlos MRO can simultaneously service up to
nine aircraft and has 23 technical component shops.
In 2024, LATAM Airlines Brazil invested US$7 million
in its modernization. On the other hand, the Santiago
MRO (Chile) has two hangars that can simultaneously
service two wide-body and two narrow-body aircraft,
and has 11 support workshops for maintenance.
LATAM also performs inspections in Lima (Peru) for
the Airbus A320 fleet and in Guarulhos (Brazil) for
the Airbus A320 family and the Boeing 777 fleet.
During 2024, LATAM MRO performed 435 services,
including 209 C-checks and 226 Special Checks on
LATAM group’s fleet.
On the other hand, line maintenance, with preventive
and corrective tasks, operates in several bases across
South America and the United States, totaling 2.8
million man-hours in 2024.
It should be noted that LATAM group also invests
in engine modernization to improve efficiency and
reduce its carbon footprint. Within this framework,
it has implemented the APU 131-9A in its A320-200
fleet, achieving fuel savings of 2.5% per year.
Implementation of advanced technology
In recent years, LATAM group’s Maintenance
area has obtained positive and stable results;
however, the future challenges facing the industry
increasingly demand significant progress in
performance. Therefore, e-Mantto, a technology
designed to efficiently manage the maintenance
of its aircraft, was implemented as part of
LATAM group’s digital transformation strategy.
In this context, in 2024, LATAM group consolidated
15 squads—multidisciplinary teams directly
linked to e-Mantto. In fact, these teams are
characterized by their autonomy and their focus on
specific objectives related to the management and
optimization of aircraft maintenance, combining
various skills to solve problems efficiently and
quickly. As a result, the achievements were
compelling: fewer operational interruptions, a
significant reduction in inventory, lower costs and
streamlined processes that benefited hundreds
of employees.
Thus, e-Mantto proved to be so efficient that its
impact on productivity is equivalent to operating
an additional aircraft, reflecting its contribution
to LATAM group’s overall performance. By
the end of the year, this technology had been
implemented in two B777 aircraft.
Also, since 2019, the São Carlos Maintenance
Center (MRO) has been using drones for aircraft
inspection, making this process 12 times more
efficient than the traditional method.
The drones take detailed images of the fuselage
and use artificial intelligence to accurately
identify potential damage.
AeroShark
In addition, LATAM group implemented AeroShark,
an innovative biomimetic coating technology
inspired by shark skin, which reduces fuselage
friction in flight. This solution enables lower fuel
consumption and CO2 emissions. (see more in
chapter “Commitment to Sustainability”).
Bionic adhesive film
inspired by shark skin
Measuring around 50
micrometers
› 85
LATAM
GROUP
2024
05 / OPERATIONS
Operating fleet as at december 31, 2024
RIGHT-OF-USE ASSET
UNDER IFRS 16
(QUANTITY)
PROPERTY, PLANT
AND EQUIPMENT
(QUANTITY)
TOTAL
(QUANTITY)
PASSENGER FLEET 1
Narrow-body
Airbus A319-100
13
27
40
Airbus A320-200
86
49
135
Airbus A320neo
3
27
30
Airbus A321-200
19
30
49
Airbus A321neo
0
14
14
Wide-body
Boeing 767-300ER
9
0
9
Boeing 777-300ER
10
0
10
Boeing 787-8
4
6
10
Boeing 787-9
2
25
27
Total
146
178
324
SHORT-TERM LEASES
Airbus A330-200
0
2
2
Total
0
2
2
CARGO FLEET
Boeing 767-300F
20
1
21
Total
20
1
21
Total fleet
166
181
347
1 All passenger aircraft bellies are available for cargo.
2 Includes 2 Airbus A319-100 aircraft classified as non-current assets and available for sale.
3 Includes 2 Airbus B767-300 Freighter aircraft classified as non-current assets and available for sale.
For more information on 2 and 3, see the Consolidated and Audited Financial Statements.
› 86
LATAM
GROUP
2024
05 / OPERATIONS
Fleet characteristics
LENGTH
(M)
WINGSPAN
(M)
SEATS
CRUISE
SPEED
(KM/H)
MAXIMUM
TAKE-OFF WEIGHT
(KG)
Passenger Operation – short haul/narrow-body fleet as at December 31, 2024
Airbus A319-100
33.8
34.1
144
830
70,000
Airbus A320-200
37.6
34.2
180
830
77,000
Airbus A320 -200neo
37.7
34.3
180
830
77,000
Airbus A321-200
44.5
34.4
224
830
89,000
Airbus A321- neo
44.5
35.8
224
800
93,500
Passenger operation – Long haul as at December 31, 2024
Boeing 767 -300ER
54.9
47.6
233
851
186,880
Boeing 777 -300ER
73.9
64.8
410
894
346,500
Boeing 787-8
56.7
60.2
247
903
227,900
Boeing 787-9
62.8
60.3
300
903
252,650
Cargo operation - Fleet as at December 31, 2024
Boeing 767 – 300F
54.9
47.6
NA
851
186,880
› 87
LATAM
GROUP
2024
05 / OPERATIONS
Snapshot
UNIT
2021
2022
2023
2024
NCG 519: 9.SUSTAINABILITY - 9.1 SASB METRICS
PASSENGER OPERATIONS
SASB TR-AL-000.A, TR-AL-000.B, TR-AL-000.C, TR-AL-000.E
Capacity
ASK1 - million
67,636
113,852
137,251
157,931
Revenue passenger-kilometer
RPK2 - million
50,317
92,588
114,007
133,138
Load factor
ASK1 (%)
74.4
81.3
83.1
84.3
Revenues/ASK1
USD cents
4.9
6.7
7.4
7.1
Total passengers transported
Thousands
40,195
62,467
73,898
82,007
Passenger flights per year
Thousands
N/A
439,309
522,558
567,170
CARGO OPERATIONS
SASB TR-AL-000.D
Capacity
ATK3 - million
4,788
6,256
7,171
8,066
Revenue tons-kilometer
RTK4 - million
3,035
3,532
3,704
4,330
Load factor
ATK3 (%)
63.4
56.5
51.7
53.7
Revenues/ATK3
USD cents
32.2
27.6
19.9
19.8
Tons transported
Thousand tons
801.5
900.6
945.5
998.1
1 ASK: Acronym for “available seat kilometers”.
2 RPK: Acronym for “revenue passenger-kilometers”.
3 ATK: Acronym for “available ton-kilometers”.
4 RTK: Acronym for “revenue ton-kilometers”.
› 88
LATAM
GROUP
2024
LATAM
GROUP
2024
› 89
06 / CLIENTS
06
_CLIENTS
91 PASSENGER OPERATIONS
100 CARGO OPERATIONS
102 INNOVATION
103 TECHNOLOGY, CYBERSECURITY AND DATA PROTECTION
LATAM
GROUP
2024
06 / CLIENTS
GRI 3-3
LATAM group’s companies, which have customers
in both their passenger and cargo operations, have
always believed in the transformative power of travel,
a conviction that has led them to commit to a purpose
that transcends the mere role of being a form of
transportation. For a decade, their mission was to
“ensure that dreams reach their destination”. This
message, which inspired LATAM group’s companies
even at the most challenging times, reflected its
connection to people’s goals, loved ones, aspirations
and dreams.
Today, that purpose has evolved. LATAM group
aspires to be much more than a travel and business
facilitator; it seeks to become an integral part of
its customers’ dreams, committing to something
deeper, more ambitious and meaningful in every
experience it provides. In this framework, its purpose
is redefined as to: “elevate every single journey”.
ELEVATE EVERY SINGLE JOURNEY
Ranked in 4th place in on-time
performance for global airlines, being
the only South American airline among
the five most punctual
airlines worldwide
(Source: Cirium).
ON-TIME
PERFORMANCE
51 points of NPS in passengers
and 56 points of NPS in premium
travelers.
HISTORICAL NPS
They highlighted the capacity
delivered to and from Europe,
commercial service and service
quality.
CARGO
CUSTOMERS
For the fifth time, LATAM group
was recognized at the World Airline
Awards 2024 - SKYTRAX.
BEST AIRLINE IN
SOUTH AMERICA
This change represents a significant improvement
from its previous purpose. While “ensure” alludes
to a momentary act, “elevate” embodies an
ongoing commitment to improvement, progress and
achievement—principles that are an essential part
of LATAM group’s DNA.
Framed in a process that is moving towards its
integration into both internal strategy and external
communication, this purpose seeks to impact not only
customers’ experience, but also that of employees
and local communities. Moreover, it bolsters LATAM
group’s commitment to provide an exceptional service
that meets the needs of its customers, both in its
passenger and cargo operations, at every stage of
the journey or logistics process.
CHOICE
Offer a diverse value proposition
tailored to the preferences of each
customer.
DEPENDABLE
Execute services with efficiency,
reliability and following the principles
of fairness, empathy, transparency
and straightforwardness (JETS, for
its Spanish acronym).
CARE
Focus on hospitality, assuming the
role of travel host to meet the needs
of customers in a personalized way.
› 90
LATAM
GROUP
2024
06 / CLIENTS
Optimization of the
LATAM Pass program
Modernization of the
fleet to raise service
standards
Better in-flight
experience
Increase in premium
services
PASSENGER OPERATIONS
GRI 3-3
During 2024, LATAM group redoubled its efforts
to transform the travel experience, always putting
passengers at the center of every improvement. It
focused on offering greater comfort, personalized
services and cutting-edge technology that provides
autonomy and agility, ensuring a unique and pleasant
experience.
More technology
and customization
More exclusive
and sustainable
lounges
Improved
baggage
handling
Automation and
customer service
1
5
2
6
3
7
4
8
› 91
THESE ARE SOME OF THE INITIATIVES THAT
MARKED THIS COMMITMENT:
06 / CLIENTS
2. Modernization of the fleet to raise service
standards
⚫ Incorporation of four Boeing 787-9 aircraft into
the operation, which feature new cabin interiors, a
revamped in-flight entertainment system (IFE)—
including screens and entertainment options such
as movies, music and games—and technology
enhancements, such as Bluetooth connectivity for
personal headsets in Economy Class.
⚫ Overhaul of thirteen narrow-body aircraft,
renovating the cabin interior and installing a new
Premium Economy class, with more space and
recline, blocked middle seat, and a differentiated
service. The entertainment and Wi-Fi system was
also upgraded to the latest generation.
⚫ Retrofit of nine used aircraft acquired. This process
adapts the aircraft to LATAM group’s operating
characteristics and conditions, improving the passenger
experience with a full cabin renovation. By January
2025, one aircraft remained to be modified.
1. Optimization of the LATAM Pass program
⚫ Launch of the LATAM Pass app in Spanish-speaking
countries.
⚫ Incorporation of significant improvements into the
web platform to keep members better connected
and offer them an exceptional digital experience.
⚫ Elimination of the Gold Plus category as of 2025,
to adjust the thresholds for achieving elite status.
⚫ Introduction of LATAM Pass Bonus in 2025. This
will allow all members to customize their trip by
choosing additional benefits beyond their category.
Indeed, each time a qualifying points target is
achieved, it will activate a list of possible benefits
that members can use on a future trip, enhancing
their experience with benefits such as free baggage,
VIP lounge access, qualifying points accumulation
or better performance on favorite routes.
⚫ Elimination of restrictions to accumulate qualifying
points exclusively on LATAM flights, thanks to the
expansion of the alliance network. This enables
members to accumulate points without limitations when
flying with partner airlines, expanding opportunities
to reach elite status and enjoy more benefits.
› 92
LATAM Pass, LATAM group’s loyalty program, stands out as a
strategic asset and a key source of value. It is a central pillar of
LATAM group’s marketing and loyalty strategy, rewarding customer
loyalty, generating additional revenue and promoting user retention.
The program has five elite categories in 2024: Gold, Gold Plus,
Platinum, Black and Black Signature. These categories offer exclusive
benefits such as mileage accrual bonuses, free upgrades, VIP lounge
access and boarding and check-in privileges. Members earn LATAM
Pass miles based on the sum spent on tickets, which can be redeemed
for future free tickets, products or services available in the partner
ecosystem and in the LATAM Pass Shopping Marketplace.
49 MILLION
LATAM Pass members
(+9% vs 2023)
LATAM
GROUP
2024
06 / CLIENTS
LATAM
GROUP
2024
Cartagena de Indias, Colombia
› 93
3. Better in-flight experience
⚫ All LATAM group’s aircraft have premium cabins
and in-flight entertainment systems, which can be
accessed through built-in screens in the case of wide-
body aircraft or through cell phones and tablets in
the case of narrow-body aircraft.
⚫ Wi-Fi network available in 100% of the narrow-
body fleet operated by LATAM Airlines Brazil and in
75% of the narrow-body fleet operated by affiliates
in Spanish-speaking countries (more than 7 million
passengers used the connectivity service, reaching
record levels of satisfaction in Wi-Fi usage).
⚫ Free messaging for LATAM Pass customers, while
Elite members can enjoy free internet navigation.
⚫ A 50% increase in the in-flight billboard compared
to 2023, consolidating its position as the largest
content library in South America.
+300
Movies
Music tracks
Show episodes
+1,500
+1,000
In addition, content from new streaming platforms
was added to LATAM Play, making LATAM the first
airline group in South America to have content from
three different platforms on board: Disney+, MAX
and Paramount+.
⚫ Approval of the new generation of Panasonic’s
revamped in-flight entertainment (IFE) system, which
includes 4K resolution Astrova displays, integrated
Bluetooth and the new Modular Interactive system.
⚫ Access to live TV for passengers on flights within
Brazil, with exclusive programming from Globo and
Claro TV, offering four channels on board: Globo,
Globo News, Gloob and Multi Show. This option will
be extended to other markets in 2025.
⚫ Implementation of wireless headset connection to
the entertainment system via Bluetooth on select
wide-body aircraft, along with a revamped interactive
3D map (Panasonic’s Arc™), which provides detailed
information and highlights landmarks at various
destinations as seen from the air.
⚫ Continuity of Sabores que Transportan (Flavors
that Transport), an initiative whose purpose is to
showcase the talent of emerging South American
female chefs on long-haul flights. Through the
co-creation of a “signature dish” with each of the
chefs, a menu reflecting the local culture is offered
in the Premium Business and Economy cabins. In
2024, more than 25 female chefs from Brazil, Chile,
Peru, Colombia and Ecuador were featured for their
valuable contribution to this collaboration.
06 / CLIENTS
4. Increase in premium services
⚫ Flexibility in the Premium Economy cabin of
narrow-body aircraft, allowing the expansion from
2 up to 7 rows of premium service on routes with
higher demand for this service, to offer passengers
a more comfortable experience.
⚫ Incorporation of a Signature check-in—an exclusive
space for LATAM Pass Black Signature and Black
customers—in Terminal 2 of the Guarulhos Airport (São
Paulo) for domestic flights in Brazil and in Terminal
2 of the Santiago Airport (Chile) for international
flights, improving comfort, privacy and agility in
passenger service. In addition, LATAM group will
expand this premium experience to the new airport
in Lima (Peru) in 2025.
⚫ Start of the overhaul of the Premium Business
cabin, a suite-type cabin on Boeing 787-8 aircraft,
designed to offer greater comfort and privacy. The new
Premium Business cabins offer a luxury experience,
including award-winning wines among the best in
the world, reaffirming LATAM group’s commitment to
service excellence. Commercial operation is expected
to begin during the first half of 2025.
Flexibility in the Premium Economy
cabin of narrow-body aircraft,
allowing the expansion from 2
up to 7 rows of premium service.
› 94
GRUPO
LATAM
2024
5. More technology and customization
⚫ Development of the Nimbus application for the
crew, which optimizes cabin management and makes
it possible to customize passenger experience on a
large scale.
⚫ Implementation of an artificial intelligence pilot
project (AWS NAI) in Brazil, Colombia and Peru,
designed to improve customer service and efficiently
connect customers with the most appropriate agent.
⚫ Installation of cameras at the Guarulhos airport
(São Paulo, Brazil) to monitor waiting times and
optimize queue management, in order to improve
passenger experience.
LATAM
GROUP
2024
06 / CLIENTS
6. More exclusive and sustainable lounges
⚫ At the Santiago (Chile) lounge, composting and
recycling practices were implemented to reduce
waste.
⚫ By April 2025, an infrastructure project is being
developed for the Lima (Peru) lounge. Its design,
by leading Peruvian architects Sandra Barclay,
Jean Pierre Crousse and Jordi Puig, is inspired in
the emblematic landscapes of the Peruvian coast
and mountains. It is worth noting that this will be
the first of LATAM group’s lounges to obtain LEED
certification—a prestigious international standard
that endorses sustainable and resource-efficient
buildings.
7. Improved baggage handling
⚫ Superior baggage handling performance, recording
only 3.4 lost bags per 1,000, compared to the industry
average of 6.9 bags according to the latest SITA data.
8. Automation and customer service
⚫ Continuous development of capabilities that
facilitate customer self-service through digital media,
especially in situations of delays or cancellations,
always ensuring the greatest possible flexibility.
⚫ Elimination of physical check-ins, offering passengers
a faster and simpler travel experience.
› 95
⚫ Incorporation of WhatsApp as a new customer
service channel, complementing the functionalities
of LATAM group’s website to offer more accessible
and efficient communication.
06 / CLIENTS
LATAM
GROUP
2024
DISTRIBUTION CHANNELS
NCG 519: 6.2.II BUSINESSES
LATAM group understands that in a world where the
flow of information is advancing at an unprecedented
pace, adapting is not only a necessity, but also an
opportunity to transform the way it interacts with
its customers. Therefore, its distribution structure
includes direct and indirect channels, both focused on
improving platforms to facilitate sales and services.
In fact, LATAM group is making significant progress
in the digital transformation of these channels.
Regarding direct distribution channels, which include
sales offices, contact centers and e-commerce
(website and mobile apps), in 2024, 63% of passengers
purchased their tickets through one of LATAM’s
direct channels, translating into an increase of 3
percentage points compared to 2023. Sales offices
complement the customer experience by offering
additional services, while contact centers provide
support in six languages. On the other hand, mobile
apps improve contingency management and optimize
the online experience.
As for the indirect distribution channels, they include
travel agencies, general sales agencies and online
platforms. In 2024, 37% of passengers purchased their
tickets through one of LATAM’s indirect channels,
translating into a decrease of 3 percentage points
compared to 2023.
In this context, LATAM group offers options such as
the Global Distribution Systems (GDS) and its direct
connections, “eLATAM” and “NDC by LATAM”, which
are constantly undergoing improvement.
It is worth noting that in 2023, LATAM group
implemented the International Air Transport
Association’s (IATA) New Distribution Capability
(NDC) standard, allowing it to optimize inventory
and offer more personalized digital services. In
2024, efforts focused on expanding access to NDC
for agencies through a variety of options, including
an Application Programming Interface (“API”), a free
portal and partnerships with 24 certified aggregators,
as well as strategic alliances with Global Distribution
Systems (GDS) such as Amadeus and Sabre. These
improvements not only strengthen LATAM group’s
competitive position, but also support its future
growth.
Passenger operations:
Airport offices
Contact Center
Face-to-face agencies
Online agencies
Sales offices
Website (LATAM.COM)
Other airlines’ websites
Cargo operations:
Airport offices
Contact Center
Agencies
Website (LATAMCARGO.COM)
Marketplace (Virtual Agency)
59%
Customers who purchased
services online in 2024
48%
44.3
MILLION
Revenues generated by the
online channel in 2024
Tickets purchased online
Online strategies and customers
LATAM group is committed to developing digital
strategies designed to strengthen trust, generate
value and establish more meaningful connections.
Along these lines, LATAM group constantly challenges
itself to understand and meet the needs of those
who interact with its digital platforms. To this end,
it closely monitors the impact of its channels, from
the percentage of customers using online services to
the revenue generated by these channels, ensuring
a continuous evolution in the quality of the digital
experience it offers.
› 96
› 97
TECHNOLOGY THAT BRINGS US CLOSER
Since 2021, each LATAM group cabin crew member
has a roaming device, which allows them to access
various historical data about our customers, thus
improving passenger service through the Nimbus
app. It provides details of any previous customer
inconveniences, such as delayed connections, special
care needs and food requirements, or even if the
passenger is celebrating their birthday in-flight.
In addition, this tool inspired a group of crew members
to record safety instructions in videos using the sign
languages of the five countries where LATAM group
operates domestic flights (Brazil, Chile, Colombia,
Ecuador and Peru), to provide guidance to hearing-
impaired passengers.
In turn, LATAM group has implemented an innovative
virtual training program for its cabin crew, making
it one of the few airlines in the world to offer this
modality. This approach allows crew members to
receive a more practical and effective preparation
before the exams, at a lower cost, optimizing time
and resources in their training.
ASD CLIENT SERVICE CERTIFICATION
LATAM group became the first airline group in South
America to receive certification for training customer
service teams to serve passengers with Autism
Spectrum Disorder (ASD). This training, provided by
Autism Double-Checked, an organization specializing
in the care of people with ASD, reached 15,000
employees who interact directly with customers.
The training program is developed in three stages: i)
Autism Aware, which raises employee awareness and
provides tools for proper care; ii) Autism Ready, which
provides specific knowledge to address particular
situations and how to handle them effectively; and
iii) Autism Double-Checked, which focuses on sharing
relevant information with the autistic community to
ensure a more comfortable and safer flight.
In addition, with the support of the Sunflower for
Hidden Disabilities program, LATAM group implemented
the use of a special lanyard with a sunflower design,
which allows discreet and voluntary identification
of people with invisible disabilities. This lanyard
is available free of charge throughout our airport
network.
These initiatives are just the first step in a process
of change designed to improve the travel experience
for passengers with disabilities, while making it easier
for LATAM group’s teams to identify and manage the
challenges this group may face during their journey.
06 / CLIENTES
LATAM
GROUP
2024
06 / CLIENTS
GRUPO
LATAM
2024
› 98
SATISFACTION
GRI 3-3
LATAM group constantly monitors customer perception
regarding its operation and service, using a series of
surveys at different customer contact opportunities
throughout their flight experience.
Along these lines, perception indicators are essential
to the group and allow for continuous improvement
within the operations teams, by making decisions
based on the voice of the customer. One of these
key indicators is the Net Promoter Score (NPS), which
measures passengers’ willingness to recommend the
service on a scale from -100 to +100. In 2024, the
NPS in passenger operations was 51 points, reaching
56 points in premium travelers. Both results are the
highest scores in the history of LATAM group.
In turn, LATAM Pass obtained its highest level of
customer satisfaction, with 58 points among all
members.
However, in 2025, LATAM group will continue to
expand and improve the way it collects the voice of
its customers. To this end, it established satisfaction
targets for different internal teams, which shows its
ongoing commitment to customer focus.
1 Note: The Net Promoter Score (NPS) survey has “Promoters”, meaning customers
who respond with scores of 9 or 10.
.
NPS1 passengers
+3 points vs. 2023
51 POINTS
NPS1 premium travelers
+1 point vs. 2023
56 POINTS
Guanajuato, Mexico
LATAM
GROUP
2024
› 99
ON-TIME PERFORMANCE
GRI 3-3
One of LATAM group’s fundamental commitments
is to guard its passengers’ time. In line with this
priority, in 2024, LATAM group achieved 84% in the
DEP 15 indicator, which analyzes flights departing
up to 15 minutes after the scheduled time. This
result represents a drop of two percentage points
compared to 2023, which is mainly attributed to
congestion at the airports of Bogota (Colombia),
Santiago (Chile) and Lima (Peru).
Specifically, the Bogota airport (El Dorado International
Airport) experienced a significant Ground Delay
Program (GDP) throughout the year, while the Santiago
airport (Arturo Merino Benitez International Airport)
had work done on the right-side runway since April
and the Lima airport (Jorge Chavez International
Airport) has had complex procedures between the
control tower and apron management. Despite these
challenges, LATAM group remained among the top
5 in global carrier punctuality rankings.
For 2025, a challenging context is expected, as the
company expects new construction works at the
airports of Congonhas/São Paulo (Brazil) and Santiago
(Chile); higher levels of the Ground Delay Program
(GDP) in Bogotá (Colombia); and, the opening of the
new terminal in Lima (Peru). Nonetheless, LATAM
group remains committed to delivering the highest
standards of on-time performance. Indeed, together
with suppliers and airport authorities, LATAM group
continues to work on the necessary adjustments
and process improvements to provide passengers
with an excellent service.
GROUND DELAY PROGRAM (GDP)
In line with industry standards and its commitment to operational
efficiency, LATAM group implements the Ground Delay Program
(GDP)—a program developed by the U.S. Federal Aviation
Administration (FAA) to manage and reduce airport delays.
This program is activated when flights are expected to experience
delays due to adverse weather conditions, air congestion or other
factors. Its main objective is to minimize ground standby times
and optimize air traffic flows.
84%
in the DEP 15 indicator, which
analyzes flights departing up to 15
minutes after the scheduled time.
06 / CLIENTS
LATAM
GROUP
2024
› 100
06 / CLIENTS
CARGO OPERATIONS
During 2024, LATAM group continued to drive its
leadership in the cargo sector, which mainly serves
businesses. In this context, the group focused on
expanding its fleet and implementing technological
solutions that improve the experience of these
customers.
With a firm commitment to deliver greater capacity,
efficiency and reliability, these are some of the key
initiatives that stood out in the year:
FLEET EXPANSION
⚫ LATAM group had 21 Boeing 767-300F/BCF aircraft
by the end of 2024 thanks to its fleet expansion
and renewal plan launched in 2021. The aircraft
added during 2024 will progressively replace older
freighters. As part of this process, going forward, the
company expects to close 2025 with 20 aircraft and
to stabilize the operation with 19 freighter aircraft
in 2026.
DIVERSIFICATION
⚫ Introduction of a new product portfolio in the
Brazilian domestic market, offering more accurate
and reliable solutions to customers. Specialized
options were incorporated for different types of cargo,
such as perishables, pharmaceuticals, live animals,
e-commerce, among others, ensuring a service that
is better suited to the specific needs of each sector.
INVESTMENTS IN TECHNOLOGY
⚫ Implementation of the CROAMIS system—already in
use in Brazil’s international and domestic businesses—
in domestic cargo operations in Spanish-speaking
countries, improving consistency and efficiency in
cargo management.
LOYALTY
⚫ Launch of a loyalty program in partnership with
LATAM Pass for the Brazilian domestic market,
allowing cargo customers to accumulate and redeem
benefits with LATAM group. This program is designed
to strengthen customer relations and foster long-
term customer loyalty.
SATISFACTION
GRI 3-3
LATAM group remains committed to continuously
improving the experience of its cargo customers,
based on the results of various surveys conducted
throughout the entire cargo transportation service
from quotation to invoicing. Customer perception is
essential to optimize the operation, allowing specific
adjustments to be made to operational processes.
In this context, the Net Promoter Score (NPS) is one
of the key indicators, as it reflects the customers’
willingness to recommend LATAM group’s services.
Thus, in 2024, the NPS of the cargo operation reached
50 points, translating into an 8-point drop vs. 2023.
This drop took place in the second half of the year
and is directly associated with a lower flown-as-
booked (FAB) rate. It should be added that this is due
to an acceleration in demand at a higher rate than
expected, mostly on flights from North America.
Looking ahead, LATAM group plans to further
strengthen its value proposition, as well as continue
to expand and improve the way it collects the voice
of its cargo customers.
ON-TIME PERFORMANCE
GRI 3-3
In the sphere of cargo operations, the indicators used
not only measure punctuality, but also the quality
of the service delivered as compared to the promise
made to customers. The indicator that most closely
resembles on-time performance is Flown as Booked
(FAB), since it determines whether the cargo arrived
at its destination within the time and conditions
established in the contracted service.
On the other hand, the main service indicator of
LATAM group’s cargo operators is Transported
as Promised (TAP), which includes FAB, but goes
further by adding the fulfillment of other milestones
during freight transportation. This allows for a more
comprehensive view of the performance of the cargo
operation.
Thus, in 2024, the Flown as booked (FAB) indicator
reached 78% compliance in the international business.
Meanwhile, in the domestic business (Brazil), FAB
compliance reached 86%. These figures reflect LATAM
group’s cargo carriers’ commitment to maintaining
high standards of service quality and punctuality,
despite the operational and logistical challenges
that may arise.
78%
on the Flown as Booked (FAB)
indicator in the international
business.
› 101
LATAM
GROUP
2024
06 / CLIENTS
COMPLAINT MANAGEMENT
GRI 2-25
LATAM group is transforming the relations with its
customers in both the passenger and cargo businesses
through a robust digital transformation strategy,
with artificial intelligence (AI) playing a key role in
customizing experiences and redefining how it offers
solutions. Indeed, through the use of AI, LATAM group
has developed self-service bots that use natural
language, eliminating complex telephone menus and
allowing for more fluid and effective interactions.
In addition, AI enhances contact analysis, enabling
LATAM group to identify opportunities for continuous
improvement, optimize processes and better adapt
to customer needs.
In addition, LATAM group is promoting proactive
engagement by using AI to anticipate customer needs
and provide customized solutions at every touch point.
From notifications about flight changes to options
such as LATAM Wallet—a virtual payment method
that allows customers to receive compensation and
refunds—AI enables a better adapted and more
efficient experience.
Artificial intelligence has also been key to identifying
those customer requirements that are most
sensitive, so they can be immediately channeled to
a specialized team. In addition, LATAM group uses AI
to classify complaint according to their root causes.
As an example, during 2024, LATAM group has
consolidated the organizational culture of complaint
reduction through routines established in more than
15 roundtables, focused on the implementation of
initiatives that address the root causes of complaints
and improve customer satisfaction.
On the other hand, quality monitoring in the Contact
Center, which used to be manual and depended
on a team listening to hours of calls to identify
opportunities for improvement, is now done using
voice and text analysis tools. These tools identify
patterns, which allows LATAM group to have 100%
observability. Thanks to this improvement, 50%
of the team’s time is spent training AI engines,
while the other half is spent interacting directly
with service teams, providing feedback, improving
training content and carrying out other activities
that generate significant value for both employees
and customers.
At yearend, LATAM group was recognized as the
airline group with the lowest complaint rate in Chile,
according to the Civil Aeronautics Board (JAC, for its
Spanish acronym). On the other hand, LATAM Airlines
Peru was the airline with the lowest complaint rate
in Peru, according to the National Institute for the
Defense of Competition and Protection of Intellectual
Property (INDECOPI, for its Spanish acronym) and
the General Directorate of Civil Aeronautics (DGAC,
for its Spanish acronym).
In addition, LATAM group won the award for best
airline in Brazil in “Reclame Aqui”, an independent
benchmark digital platform in the resolution of
disputes between companies and consumers. In
“Reclame Aqui”, companies are rated on their ability
to resolve customer complaints.
LATAM group won the
award for best airline in
Brazil in “Reclame Aqui”, an
independent benchmark digital
platform in the resolution of
disputes between companies
and consumers.
INNOVATION
NCG 519: 3.1.V GOVERNANCE FRAMEWORK
LATAM group invests annually in various forms of
innovation to offer solutions aligned with passenger
needs, prioritizing its digital transformation strategy.
In addition, it is continuously advancing in the
modernization of its processes and the incorporation
of new technologies, such as advanced analytics, the
full migration of its data centers to the cloud, and
in driving Generative Artificial Intelligence.
Innovation is part of LATAM Group’s DNA, and all
employees are responsible for promoting it. In addition,
the IT & Digital vice presidency drives this effort, and
its technology teams are strategically organized to
include dedicated specialists in each of the business
areas. This structure allows multidisciplinary teams
to continuously explore new ways of generating value
through technology.
On the other hand, LATAM group’s investment and
financing mechanisms are designed to promote
experimentation, prioritizing initiatives that directly
benefit its customers. Thus, during 2024, the company
allocated significant resources to innovation, focusing
on key areas to maximize the value delivered to its
passengers. As part of this, it continues to advance in
processes that contribute to its digital transformation
strategy, such as the implementation of generative
artificial intelligence, with an emphasis on modernizing
processes and optimizing the impact of innovation.
In this context, LATAM group invested approximately
US$16 million in digital transformation processes in
the Maintenance area, integrating technology into
the core of the business to improve operational
efficiency. It also allocated nearly US$8 million to
the customer loyalty program, with the purpose of
improving the passenger experience through advanced
technological solutions. These efforts reflect LATAM
group’s commitment to using technology as a core
element to enhance development and competitiveness.
LATAM LABS
Among LATAM group’s innovation initiatives, LATAM
Labs, created in 2020 as an open innovation hub, stands
out. This space makes it possible to test disruptive
ideas within the group’s companies, experimenting with
proposals generated by both employees and external
ecosystems such as universities, entrepreneurs, startups
and knowledge centers.
20
AMELIA
external partners collaborated with
LATAM Labs in 2024.
As part of its commitment to innovation, LATAM group also introduced
generative artificial intelligence tool Amelia, available to all its employees.
This initiative seeks not only to increase individual productivity, but also
to boost the company’s digitization, fostering creativity and efficiency
in daily activities.
Both achievements reflect LATAM group’s commitment to excellence and
innovation, principles that guide its mission to connect people and their
dreams, elevating each trip to a unique experience.
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LATAM
GROUP
2024
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› 103
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LATAM
GROUP
2024
TECHNOLOGY, CYBERSECURITY
AND DATA PROTECTION
GRI 3-3 & 418: CUSTOMER PRIVACY
INFORMATION SECURITY GOVERNANCE
It is a priority for LATAM group to ensure adequate
levels of protection and cybersecurity for its
operations and business processes, as well as for
the information security and privacy of customers,
investors, employees and suppliers. Therefore, it has
defined an organizational structure with specialized
and dedicated personnel and formal bodies of a high
hierarchical level, with powers and competencies
required to manage information security and
cybersecurity.
As part of this organizational structure, it is worth
noting the role of the Chief Information Security
Officer (CISO), who is responsible for the design
and maintenance of an adequate system for the
identification, monitoring, control and mitigation of
data protection and cybersecurity risks. This role
reports hierarchically to the Vice President of IT &
Digital led by Juliana Rios (CIO) who, in turn, reports
to the company’s CEO. The CIO also presents monthly
to the Executive Committee, composed of the CISO
and the CTOs of the IT & Digital vice-presidency,
and to the Board of Directors at meetings every four
months. These meetings review cybersecurity risks,
the evolution of cyber threats and the effectiveness
of measures taken to mitigate them. This supervision
is supported by auditing exercises conducted by the
Internal Audit department and independent third
parties, which ensure adherence to the established
security policies.
In 2024, LATAM group strengthened its comprehensive
approach for handling information security and
cybersecurity incidents with the participation of
the Cyber Emergencies Committee, chaired by the
CISO and composed of leaders from various IT areas,
designed to provide a rapid and effective response
to different areas of the company in the event of a
technological emergency with a high global impact.
In alignment with this committee, a program was
established for the execution of periodic incident
response drills to evaluate tolerance to cyber risks,
ensuring preventive and reactive handling of potential
threats that could generate a crisis.
DATA GOVERNANCE
Additionally, in line with LATAM group’s commitment
to the protection and privacy of its customers’
information, a three-way approach to data management
has been adopted, integrating collaboration between
the CISO, the Data Officer and the Data Protection
Officers (DPOs) designated in each jurisdiction.
This approach is complemented by Data Protection
Committees, which align their activities with local
regulations and assess high-impact risks.
Along these lines, the data governance framework
is overseen through two committees: the Strategic
Data Governance Committee, responsible for defining
policies and managing risks, and the Operational
Data Committee, which focuses on data quality
and problem solving. Both bodies conduct audits
and monitor key performance indicators (KPIs) to
ensure regulatory compliance.
In turn, the Vice-Presidency of IT & Digital heads
not only the management of cybersecurity, but also
LATAM group’s digital transformation strategy, driving
a comprehensive change in business development,
with technology at its core.
It is a priority for LATAM
group to ensure adequate
levels of protection and
cybersecurity for its
operations and business
processes
In this sense, the digital transformation process has
required the participation of various departments
across LATAM group. At the same time, it has made
it possible to identify new challenges and develop
solutions designed to maximize the value delivered
to customers.
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› 104
CYBERSECURITY MANAGEMENT
TECHNOLOGICAL
RISKS EXECUTIVE
COMMITTEE
Members
CISO and IT & Digital CTOs.
Functions
Strategic security supervision.
Mitigation of technological
risks.
Promotion of the risk
management strategy.
DATA PROTECTION
COMMITTEES.
Alignment with local
regulations.
High impact risk assessment.
DATA OFFICERS
Data Protection Officers
(DPOs).
CYBER EMERGENCY
COMMITTEE
Members
CISO and leaders of different
IT areas.
Key activities
Deliver a rapid and effective
response in the event of a
technological emergency with a
high global impact.
DATA GOVERNANCE
COMMITTEES.
Strategic Data Governance
Committee
Defines policies and manages
risks.
Data Operating Committee
Focus on data quality and
problem solving.
LATAM GROUP
CHIEF EXECUTIVE OFFICER
DATA GOVERNANCE
CEO
VICE PRESIDENT
OF IT & DIGITAL
CHIEF INFORMATION
SECURITY OFFICER
CIO
CISO
INTERNATIONAL STANDARDS
ISO/IEC 27001
Information security management.
NIST
Cybersecurity and risk management
framework.
PCI DSS
Payment card data protection.
AUDITS
Internal
⚫ Audit Committee: Independent role in
privacy and cybersecurity risk assessment.
⚫ Internal Audit: Independently ensures
adherence to established security policies.
External
⚫ SOC 1 and SOC 2: Validation of the
reliability of the outsourced digital
infrastructure.
LATAM
GROUP
2024
POLICIES AND STANDARDS
GRI 2-24
LATAM group establishes its guidelines through the
Information Security Policy, which was first published
in 2016 and last updated in 2024. This document
defines the guidelines for the protection of the
company’s information, ensuring its effective control
through risk, security and privacy management.
The corporate commitment is publicly available
on the investor relations portal and available to all
employees internally on the intranet.
Likewise, LATAM group has an Internal Privacy and
Personal Data Protection Policy covering the whole
corporation, which applies to all its employees and
third parties that may come into contact with personal
data managed by the group. This document establishes
the guidelines for the processing of personal data,
in compliance with the data protection legislation in
force in the jurisdictions where it operates, and seeks
to ensure the prior consent of the data owners, for
the specific purposes for which their data is collected.
Although this document is internal in nature, LATAM
group publishes on its website the general measures
applicable to the protection of its customers’ data
in each country where it operates, adapting to the
user’s navigation. Likewise, it maintains public
guidelines for its employees through its Code of
Conduct and includes specific clauses in individual
contracts with suppliers to ensure compliance with
its internal policy.
The Cybersecurity Management, which reports to
LATAM group’s CISO, is responsible for ensuring the
effective compliance with Information Security Policies
and procedures for the protection of personal data,
through risk, security and privacy management.
All LATAM group’s information security policies,
regulations, standards and procedures are based on
ISO/IEC 27001 and NIST standards. In addition, its
digital infrastructure is outsourced and is continuously
assessed through SOC1 and SOC2 Type II reports,
based on Statement on Standards for Attestation
Engagements No. 18 (SSAE18), and is also ISO/IEC
27001 certified.
Additionally, in 2024, LATAM Airlines Group S.A. and
its affiliates obtained their sixth consecutive PCI DSS
compliance certification in its current version (4.0),
as a result of an independent audit. This recognition
confirms the implementation of effective controls
to guarantee the data protection and privacy of
customers who purchase products and services using
credit or debit cards through its sales channels.
It should be noted that, at the same time, internal
review planning is carried out every year to ensure
compliance with the privacy and data protection
controls of the systems that manage personal data, as
well as the updating of corresponding documentation.
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06 / CLIENTS
LATAM
GROUP
2024
› 106
With this strategy, LATAM group not only seeks to
become more agile and profitable, but also to chart
a clear path towards a future where technology
continues to be a key enabler for its transformation
and success in Latin America.
Meanwhile, in the sphere of cybersecurity, the Chief
Information Security Officer (CISO) has established
the following main focal points for 2025:
⚫ Quantify cyber risks and allocate resources based
on expected losses.
⚫ Use artificial intelligence (AI) for protection and
defense, as well as for process automation to increase
the effectiveness of cybersecurity controls.
⚫ Strengthen preparedness strategies to minimize
impact in the event of a cybersecurity crisis.
⚫ Raise the level of awareness and training throughout
LATAM group.
STRATEGY
Looking ahead, LATAM group’s technology strategy focuses on three fundamental pillars to
consolidate its position as a leader in technological and operational innovation:
ADVANCING ON
AUTOMATION
Process acceleration
Continue to drive automation
in product creation processes,
reducing development times and
improving operational efficiency.
Driving innovation
To become a key enabler for
LATAM group’s teams, providing
tools and methodologies that
foster value creation in an agile
and effective manner.
COST EFFICIENCY
Optimization of the cloud
infrastructure
Identify and capitalize on
opportunities to reduce costs in
the current cloud infrastructure,
adopting an aggressive strategy
focused on efficiency.
Proactive resource
management
Implement advanced monitoring
and adjustment practices to ensure
optimal use of resources across
LATAM group’s operations.
IMPLEMENTATION OF AN
ENTERPRISE ARCHITECTURE
STRATEGY
Medium- and long-term
design
Define a clear architectural
framework to guide how teams
and applications interact in LATAM
group.
Promotion of collaboration
and innovation
Create a solid technological
foundation that allows teams to
work in a more integrated and
efficient manner, maximizing the
impact of their efforts.
Parque Nacional Torres del Paine, Chile
06 / CLIENTS
LATAM
GROUP
2024
LATAM
GROUP
2024
06 / CLIENTS
DIGITAL TRANSFORMATION AND
CONTINUOUS IMPROVEMENT
NCG 519: 3.6 RISK MANAGEMENT
In 2024, LATAM group consolidated important
advances in its digital transformation and continuous
improvement, reaffirming its leadership in this area
in the aviation industry across the region. Among
the highlights of the period was the digitization of
the loyalty program, focused on the adoption of
advanced technologies, including artificial intelligence,
aimed at both employees and customers. Likewise,
LATAM group also doubled its investment in data
analytics equipment, strengthening its strategy to
become a data-driven organization.
On the other hand, with a firm commitment to
corporate resilience, LATAM group strengthened
its capacity to respond and adapt to a constantly
changing global environment. During 2024, it made
progress in modernizing its technological infrastructure,
expecting to reach 100% cloud-native infrastructure
by mid-2025, to provide greater flexibility, scalability
and efficiency, in addition to reducing deployment
times and operating costs. In addition, it modernized
legacy systems and eliminated critical points of
obsolescence, ensuring that its platforms are ready
to meet current and future business demands.
LATAM group also made progress in the identification
and analysis of technological and cybersecurity
risk scenarios, making significant progress in the
quantification of these risks. This will allow a better
resource allocation based on expected losses, with
the aim of reaching 100% of quantified risks by the
first half of 2025. At the same time, it strengthened
its technology and cybersecurity controls, with
particular attention to the prevention and detection
of threats and vulnerabilities, focusing on remote
environments (the cloud) and products developed
with artificial intelligence.
Likewise, LATAM group implemented a comprehensive
vulnerability management program that significantly
reduced technological risks. On the other hand, cyber
risk management in the supply chain was enhanced,
as were crisis and incident response capabilities, and
the cybersecurity awareness program continued to
be strengthened.
All these efforts were fundamental for LATAM group to
obtain PCI DSS v4.0 certification in 2024, reaffirming
the commitment to security and reliability.
CITIZEN DEVELOPER AND DEVOPS
LATAM group implemented the Citizen Developer
program during 2024. This program allowed employees
to develop technological solutions that optimize
processes and improve customer experience. In
addition, LATAM group consolidated the DevOps
model as an operational standard, driving team
collaboration, automation and continuous value
delivery. This approach allowed for a more agile
implementation of solutions and helped reduce
response times.
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LATAM
GROUP
2024
› 108
06 / CLIENTS
CYBERSECURITY AND DATA PROTECTION CULTURE
GRI 418-1
Awarenes
Each year, LATAM group develops a training and
communication program on information security,
adapted to all its roles.
Risk escalation process
An escalation channel is available through LATAM
group’s intranet portal and the Computer Security
Incident Response Team (CSIRT) contact, so that
employees can report suspected technological or
cybersecurity risks.
Compliance and consequence management
The Code of Conduct defines the attitudes expected
by LATAM group in the arena of Information Security
and Data Protection, and establishes the consequences
of non-compliance with the set procedures, which
can escalate to contract termination. In addition,
this subject is part of the employee performance
evaluation, within the Safety, Risk Management and
Compliance criterion.
These processes and improvements contributed to LATAM group ending
2024 with no information security breaches and no impact on customers
or employees. Nonetheless, LATAM group continues to work hard in this
sphere, due to the rapidly changing threats in the environment.
PCI Regional Engagement Brazil (PCI REB Brazil)
In 2024, LATAM group once again participated
in this meeting as the only airline, reaffirming
its commitment to security and data protection
in card payments. This roundtable, led by the
Director of the PCI Council for Latin America,
brings together companies from various sectors
that seek to generate continuous improvements in
these aspects. Indeed, LATAM group consolidated
its presence on this platform, dedicated to
developing and promoting the adoption of data
security standards for secure payments and PCI
compliance.
PARTICIPATION IN INTER-COMPANY ROUNDTABLES
9th América Digital Latin American Congress on
Technology and Business
In April 2024, LATAM group participated in this
congress held in Santiago (Chile). This event,
which brought together more than 5,200 leading
executives in innovation, technology, business and
digital transformation from 50 countries, included
five specialized forums. In collaboration with its
partner Assertiva, LATAM group participated in a
conference on the transformative power of digital
identity in the aviation industry, underlining its
commitment to innovation, technological leadership
and digital transformation in the sector.
Cyber Guardian
LATAM group participated in the 6.0 edition
of the cyber defense exercise organized
by the cyber defense command of Brazil’s
National Civil Aviation Agency (ANAC, for
its Portuguese acronym) in 2024. This event
brought together different branches of the
Brazilian armed forces and government
agencies, with the purpose of strengthening
the capacity to respond to cyber threats.
LATAM
GROUP
2024
› 109
06 / CLIENTS
95%
Data intelligence
LATAM group uses data analytics tools to develop
customer-focused solutions, improve efficiency in
different processes and enhance revenue opportunities
for the group, driven by Data Management.
Throughout 2024, LATAM group experienced strong
growth in its Data Products portfolio, achieving an
81% increase in annual impact, which reinforces
the development of data capabilities within the
Business Domains. This growth is complemented by
advances in data democratization, which allowed 37%
of employees in non-operational areas to maintain
self-managed access to the corporate data catalog,
consolidating LATAM group’s position as a benchmark
in this arena and reaching levels comparable to the
leading digital-native companies in Latin America.
As for customer experience, LATAM group continued
to develop initiatives to offer increasingly customized
experiences, taking into account users’ preferences
and needs. This has been especially relevant in the
LATAM Pass program, where offering exceptional
service tailored to customers continues to be the
priority.
On the other hand, LATAM group advanced in the
implementation of technologies to optimize key
processes, such as aircraft fueling and fraud prevention.
Going into 2025, the data democratization strategy
will focus on improving the flow of the initial approach
to the data catalog through new tools that facilitate
its adoption.
To maintain the highest standards in personal
data protection, LATAM group bolstered the use of
artificial intelligence in its data storage architecture,
ensuring that 99% of the catalog is protected.
Likewise, LATAM group continues to make progress in
identifying personal data and implementing additional
protection measures, ensuring responsible handling
and compliance with current local regulations and
internal policies.
Cloud systems
LATAM group showed remarkable progress in its cloud
migration process, with significant achievements in
several key aspects. These milestones include the
simplification of its technological platforms, which
has considerably reduced the obsolescence of IT
elements and platforms, generating a lower impact
on cross-cutting incidents and allowing for a more
efficient and secure operation.
In 2024, 95% adoption of cloud-native infrastructure
was achieved, consolidating LATAM as an agile,
innovative group, prepared for future challenges. In
addition, this development reflects LATAM group’s
commitment to use the cloud as a strategic solution
not only to optimize current operations, but also
to enable new capabilities to respond quickly and
efficiently to market demands.
This progress was possible thanks to the development
of the technological infrastructure modernization
project, whose purpose has been to reduce the
technological obsolescence of the legacy systems,
reducing vulnerabilities and adding new security
controls, such as the implementation of micro-
segmentation. In addition, the project has contributed
to the administration of applications under the Build
and Run modality, making it possible to simplify
outsourced technological services and fostering the
evolution of centralized infrastructure administration
services.
With these advances, LATAM group is on the verge
of becoming a 100% cloud-native organization—a
decisive step that will strengthen its resilience,
scalability and innovation capacity, ensuring its
future leadership in the sector.
adoption of cloud-native
infrastructure was achieved,
consolidating LATAM as an agile,
innovative group, prepared for future
challenges.
LATAM
GROUP
2024
› 110
06 / CLIENTS
Snapshot
2021
2022
2023
2024
PASSENGER OPERATIONS
Customers (millions enrolled in
LATAM Pass)
39
42
45
49
Net Promoter Score
(-100 to +100 scale)
511
46
48
51
On-time performance
OTP DEP02
77%1
66% (target 68%)
62% (target 67%)
59% (target 63%)
OTP DEP153
92%
88%
86%
84%
OTP ARR144
91%
86% (target 87%)
84% (target 86%)
83% (target 85%)
International
85%
83%
82%
80%
Domestic
91%
87%
84%
83%
Technology
Self bag drop5
18%1
32%
62%
66%
Auto check-in
50%
84%
88%
89%
CARGO OPERATIONS
Clients
N/D
N/D
N/D
52,623
Net Promoter Score
(-100 to +100 scale)
30
51
58
50
On-time performance
International
FAB6
N/D
N/D
81%
78%
TAP7
N/D
N/D
60%
60%
Domestic
FAB6
N/D
N/D
N/D
86%
TAP7
N/D
N/D
N/D
69%
N/A: Not applicable.
N/A not available.
1 The information published in LATAM group’s Integrated Report 2021 was corrected.
2 Percentage of flights that take off exactly at the scheduled time, without any
delays.
3 Percentage of flights that take off with a maximum delay of 15 minutes vs. the
scheduled time.
4 Percentage of flights landing up to 14 minutes late vs. the scheduled time.
5 Self-baggage drop as a percentage of baggage checked in via LATAM Kiosk.
6 Flown as Booked (FAB): Measures whether cargo arrived at its destination in
compliance with the time and conditions of the contracted service. The domestic
indicator is limited exclusively to the result of the Brazilian operation since, during
2024, LATAM group is migrating the measurement system of this indicator to the
other domestic operations—a process that will be completed in 2025.
7 Transported as Promised (TAP): Evaluates the fulfillment of all cargo transportation
milestones, including FAB, for a more comprehensive overview of the service. This
indicator was recently made available for the domestic segment, so there is no
previous history.
NCG 519: 6.2.IV BUSINESSES
None of the LATAM group’s clients
individually represents over 10% of its
sales.
LATAM
GROUP
2024
› 111
07 / EMPLOYEES
07
_EMPLOYEES
112 WHO MAKES UP LATAM GROUP
115 TALENT MANAGEMENT
121 DIVERSITY AND INCLUSION
07 / EMPLOYEES
WHO MAKES UP LATAM GROUP
GRI 2-7
2 LATAM Group has no employees in the
"Auxiliary" category as defined by Chilean NCG
No. 519.
1 Considering: Argentina, Australia, Bolivia, Cuba, France, Germany, Italy, Mexico,
Netherlands, New Zealand, Paraguay, Portugal, Spain, United Kingdom, and Uruguay.
COUNTRY
MEN
WOMEN
BRAZIL
12,875
7,472
CHILE
5,371
4,143
COLOMBIA
1,352
1,138
ECUADOR
346
211
PERU
1,916
1,703
UNITED STATES
946
321
OTHERS
440
429
LATAM GROUP
23,246
15,417
Employees by age
range in 2024
37.9%
30 - 40 years
25.8%
< 30 years
24.7%
41 - 50 years
0.1%
> 70 years
1.8%
61 - 70 years
9.7%
51-60 years
Employees by
seniority in 2024
30.2%
> 12 years
41.0%
< 3 years
7.2%
9 - 12 years
6.6%
6 - 9 years
15.0%
3-6 years
Employees By Country
in 2024
52,6%
Brazil
24.6%
Chile
6.4%
Colombia
2.2%
Others1
9.4%
Peru
3.3%
USA
1.4%
Ecuador
FUNCTIONAL CATEGORIES2
Senior management
CEOs
Vice-presidents
Directors
Management
Senior managers
Managers
Assistant Managers
Leadership
Area managers
Department heads
Operators
Cargo operations
Maintenance
Airport
Operations control center
Sales force
Sales operations
Customer care
Administrative staff
Support activities and general roles
Other professionals
Middle management in support
activities
Other technicians
Command crew
Cabin crew
38,663
individuals
Más de:
4,400 Pilots
9,200 Cabin Crew
6,600 Professionals
8,500 Airport Staff
4,900 Maintenance Personnel
690
Sales Staff
3,000 Cargo Staff
1,000 Administrative Staff
› 112
LATAM
GROUP
2024
07 / EMPLOYEES
PEOPLE: THE ENGINE OF THE LATAM GROUP
GRI 3-3
Human Capital management is one of the most
important processes for LATAM group’s companies,
as it is employees who make possible the mission
of connecting the region with the world, providing
access to its broad network for cargo and passenger
transportation.
In this task, LATAM group's companies consider
structured training and career advancement practices
that respond to the transformations and trends of
the job markets of the countries where they operate.
They also consider dialog and approachability between
the staff and management of each company as
important factors in bolstering the joint commitment
to the execution of the business strategy and to
making LATAM group’s companies better and better.
In essence, LATAM group's Human Capital team
acts as a strategic partner that enhances business
success by maximizing human talent, nurturing and
fostering individual productivity, and strengthening
organizational culture. At the global level, the
department is headed by the Human Capital Vice-
President, who is responsible for coordinating the
strategic and operational alignment of policies,
initiatives and practices related to LATAM group's
employees in all the countries where it is present.
LATAM group maintains formal spaces for review,
collaboration and decision-making. This approach
is implemented through two weekly meetings
involving the VP of Human Resources, the heads
of corporate Human Resource functions and the
leaders of this area in each country. These bodies
ensure the coordination, coherence and alignment
of employee-related actions and strategies at all
levels of the organization.
In addition, the main objective of the LATAM group’s
Human Capital team is to align human talent
with the strategic objectives of the business. This
includes attracting and retaining the best employees,
promoting their development through training and
leadership programs, and fostering a motivating
work environment that encourages commitment
and productivity, while maintaining a labor cost base
that ensures competitiveness.
More Just, Empathetic, Transparent and
Straightforward (JETS).
LATAM group is guided by a genuine concern for people
in a just, empathetic, transparent and simple work
environment. Thus, it follows the "JETS" principles.
› 113
LATAM
GROUP
2024
LATAM
GROUP
2024
› 114
07 / EMPLOYEES
STRENGTHENING THE CONNECTION
GRI 3-3
Ongoing dialog
LATAM group’s dialog agenda includes meetings
conducted by the Human Capital department and
leaders from different areas of the group, to address
topics such as leadership, sustainability, and talent
management, among others. These forums are aimed
to strengthen strategic alignment, foster empathy
with employees and gather ideas that enrich human
capital management.
In addition, LATAM group maintains other initiatives
that reinforce this ongoing dialog:
⚫ LATAM News: Weekly meeting between leaders
and their teams.
⚫ Expanded: Periodic meetings conducted by the
vice-presidents.
⚫ 1:1 Accompaniment: Specific conversations between
each employee and their leader to support the
individual professional training and development
process.
It is important to note that leaders receive comprehensive
training to manage their teams in alignment with the
leadership model established by LATAM group. In
this sense, their performance is evaluated through
the Leadership Index and the Barometer—tools that
incorporate key variables to monitor progress towards
the objectives of simplicity and transparency, and to
ensure compliance with essential practices such as
providing timely feedback, holding team and 1-to-1
meetings, and recognizing achievements.
Likewise, teams have the opportunity to evaluate
their leaders, providing valuable insight into their
performance. Thus, LATAM group reinforces the
fundamental role of leaders as drivers of organizational
development and cohesion.
Organizational health
In 2024, LATAM group achieved its best-ever result
in the McKinsey & Company Organizational Health
Index (OHI), a survey that has been conducted for
a decade, and that evaluates work climate and
motivation topics. The 79 points obtained are one
point higher than the last evaluation performed in
2023, positioning LATAM group's companies among
those with the best organizational health in the world.
Furthermore, 2024 results also stood out for the record
voluntary participation in the survey, as 80% of the
total workforce took it, which translates into more
than 29,000 responses at the time of consultation.
It should be noted that this survey has questions that
evaluate different strategic focal points for LATAM
group, such as leadership, technological adaptation,
diversity and inclusion (D&I), and employee experience,
which includes meaning and/or purpose, as well as
psychological safety, among others.
Employee Satisfaction Survey
(eNPS) 2024
This survey (eNPS) measures engagement
and satisfaction on a scale of 0 to 10.
Each month, this survey is randomly
distributed to a representative sample
of 5,000 LATAM group employees. The
eNPS makes it possible to evaluate
employees’ conditions, measure their
well-being and determine whether they
would recommend the company as a
good place to work.
For 2024, the eNPS result
was 81 points, with an
associated target of
80 points.
in the Organizational
Health Index in 2024—
the best in LATAM group’s
history.
2024
2023
2022
2021
79 POINTS
78 POINTS
77 POINTS
77 POINTS
LATAM
GROUP
2024
› 115
07 / EMPLOYEES
TALENT MANAGEMENT
NCG 519: 5.8.I, 5.8.III, 5.8.IV TRAINING AND BENEFITS
GRI 404-1 AND 403-5
TRAINING
LATAM group's training policies establish the principles
and guidelines that govern the skills and knowledge
development processes in the different operational
areas, ensuring compliance with the applicable
requirements and regulations of each country where it
operates. These policies cover aspects such as scope
and responsibilities, training programs, periodicity,
content updates, infrastructure, and instructor
selection and training.
These programs address a wide range of key topics,
such as operational and labor safety, Diversity and
Inclusion (D&I), leadership, commercial skills, customer
service, in-flight service, emergencies, first aid,
risk prevention, hazardous goods, human factors,
technical specialties for aeronautical maintenance,
LATAM group’s internal procedures and the Code of
Conduct (Compliance).
It should be noted that LATAM group maintains a
mandatory awareness and training program for the
identification and management of bias, the use of
inclusive language and advocating for psychological
safety. In addition, it has a socialized and universally
accessible mechanism for reporting and resolving
potential situations of discrimination and/or harassment
(See more in the Confidential Channel section, in
the "Corporate Governance" chapter).
With this approach, during 2024, LATAM group spent
US$12,745,440 (equivalent to CLP$12,700,321,142)
on professional training activities for its teams,
translating into 0.10% of operating revenue.
Meanwhile, 36,399 individuals were trained (equivalent
to 94.1% of the total workforce) in key areas. As
a result, a total of 1.6 million hours of training
were completed, with an average of 46.4 hours per
employee.
TRAINING PROGRAMS
In 2024, LATAM group developed various training
programs that generated a tangible impact on
business development and implied clear quantitative
benefits for the organization. Among them:
Security Practices through Virtual Reality:
This program aims to update and optimize cabin
crew training through the use of Virtual Reality (VR)
technology. This tool allows for more immersive,
effective and standardized training by recreating
critical safety situations and emergency procedures
in a controlled and realistic environment. Thus,
the limitations of traditional training methods are
overcome.
It is worth noting that the program reached 19% of
total training hours (FTE), reflecting its strategic
importance within LATAM group's global training plan.
Revalidation of service for Contact Center and
cabin crews:
The main purpose of this workshop was to align and
reinforce hospitality culture and customer service
competencies in Contact Center teams and cabin
crews. The program, focused on developing key skills
in areas such as effective communication, conflict
management and empathy, aimed to ensure that
customers receive an excellent and memorable
experience at all touch points with the company.
It is important to note that the participation of the
teams in this program was 100% for the Contact
Center and 95% for cabin crews, which stresses LATAM
group's commitment to the continuous improvement
of service quality and customer experience.
36.3
2021
2022
2023
2024
Average training
NCG 519: 5.8 TRAINING AND BENEFITS
GRI 404-1
(h/employee)
42.7
49.9
46.4
A total of 1.6 million hours of
training were achieved, with
an average of 46.4 hours per
employee.
LATAM
GROUP
2024
07 / EMPLOYEES
PERFORMANCE REVIEW
GRI 404-3
LATAM group’s performance evaluation process includes
a section dedicated to the evaluation of competencies,
which is expected to be complied with globally. In
this context, one of the key behaviors assessed is
compliance, which is part of the competency known
as "Safe Behavior". In this sense, it specifies that
employees must display behaviors consistent with
98% of the employees subject to
the process were part of the 2024
performance evaluation.
TYPES OF PERFORMANCE EVALUATION IN 2024
By objectives
Annually, LATAM group’s companies hold a performance
evaluation process based on objectives, aligned
with competencies differentiated by segment. This
process involves executives, middle management,
supervisors and cabin and airport operations. It is
designed to contribute to the development of each
employee and human capital within each of the
organizations.
This process also includes a systematic approach in
which employees have predefined and measurable
objectives, which are collaboratively established
at least once a year with their direct manager and
routinely tracked throughout the period evaluated.
the Code of Conduct, as well as with the policies and
procedures that impact the safety of LATAM group.
It is essential for employees to understand that their
actions have a direct impact on customers, processes,
facilities and the environment.
As part of the annual feedback process, which is carried
out during the first months of the year, a summary
of the evaluation carried out the previous year is
provided. During this process, a score or evaluation
category is presented, performance strengths and
opportunities are analyzed, and an action plan is
agreed upon to correct and improve the identified
Multidimensional (360°)
LATAM group uses a tool called Barometer, which
consists of a survey with 28 questions sent to
employees to evaluate their leader and team.
Thus, all leaders with three or more direct reports
(approximately 2,000 leaders) were evaluated. In
addition, the evaluation was available to 30,000
employees.
This process not only allows leaders to measure
performance within their teams, but also extends
to evaluating department or company objectives,
receiving feedback from peers, direct subordinates
and other employees, and providing a 360-degree
view of employee performance. Likewise, customer
or external feedback is also included.
It should be noted that this process is carried out
twice a year.
areas. In this way, employees are expected to achieve
even better performance in the following year.
By teams
In the technology areas, LATAM group implements the
digital talent model. The purpose of this evaluation
is primarily increased observability, allowing leaders
to receive feedback through others’ observations on
their teams. The evaluated leaders are examined from
a Top-Down (by their leader and peers at the same
level), Bottom-Up (by their direct subordinates) and
360-degree (by anyone who interacts with them,
providing partial observability) perspective.
In addition, this system incorporates an evaluation
that considers employees as part of a team, rather
than just as individuals. Objectives are set for both
the team and individual employees, and a weighting
is applied between the individual review and the
team review, allowing for a more complete view of
performance in the group context. This evaluation
process is also carried out twice a year.
Agile conversations
This method implements the same Digital Talent
methodology used in the technological areas, and
the evaluation is carried out twice a year. However,
it is also complemented by a more agile approach
to manage employee performance and development
throughout the year. This approach, which is
unstructured, involves regular conversations and
continuous feedback, rather than being limited to
annual or semi-annual evaluations. Consequently,
in this model, performance management does not
focus solely on the end result (such as a score or
annual evaluation), but on the process to reach that
result. Therefore, this includes the constant review
of objectives and the identification of barriers that
may hinder effective performance.
› 116
07 / EMPLOYEES
SUCCESSION PLAN
NCG 519: 3.6.X RISK MANAGEMENT
LATAM group’s affiliates have a Succession Plan that
identifies potential internal and external candidates
for key positions, such as a CEO and top executives.
This plan, which is updated annually, is reviewed
on a priority basis in the event of the departure of
a critical executive, to make informed decisions on
replacement.
In the specific case of the CEO vacancy, the Board
of Directors of LATAM Airlines Group S.A. will be
responsible for selecting a successor, based on the
Leadership Committee’s recommendation.
On the other hand, specific development plans are
implemented for some of the potential successors,
with the purpose of preparing them optimally to take
on more senior responsibilities within LATAM group.
HIRING AND TURNOVER
NCG 519: 3.1.VII GOVERNANCE FRAMEWORK
GRI 401-1
LATAM group is a multicultural and diverse organization,
where the technical needs for each role and organizational
level are the only ones that prevail when defining and
measuring the talent needed for selection.
Throughout 2024, LATAM Airlines Group S.A. hired
6,827 individuals, resulting in a hiring rate of 17.6%.
On the other hand, the turnover rate was 9.8%, which
is lower than the figure for 2023 (10.8%). Meanwhile,
the voluntary turnover rate was 3.6%, also improving
compared to the 4.4% rate in the 2023 period.
It should be noted that LATAM group strategically
manages the attraction and selection of diverse
talent through standardized processes, led by the
Recruitment team. These include establishing job
profiles with management or leaders, considering
specific requirements, such as certifications, education,
experience, technical qualifications, languages and
licenses, as well as key skills and competencies for
each position.
In addition, the Recruitment team provides knowledge
of the talent market and works to mitigate biases
that could affect the attraction and selection of
diverse profiles, prioritizing a skills-based approach
over traditional track records.
In turn, the Compensations department contributes
through a job analysis to define the pay range and
evaluate the level of decision-making, coordination
and influence of each role within LATAM group.
This comprehensive approach not only broadens
access to opportunities, but also ensures a selection
process aligned with business needs and Diversity
and Inclusion best practices.
› 117
LATAM
GROUP
2024
07 / EMPLOYEES
New hires and workforce turnover in 2024
GRI 401-1
NUMBER OF INDIVIDUALS HIRED
NUMBER OF INDIVIDUALS
WHO LEFT LATAM GROUP1
LATAM Airlines Brazil
3,563
1,906
LATAM Airlines Chile
1,613
822
LATAM Airlines Colombia
493
287
LATAM Airlines Ecuador
111
51
LATAM Airlines Peru
522
272
United States Regional Office
408
354
Others4
117
79
LATAM Group
6,827
3,771
1 Total number of employees who left their position voluntarily, due to severance, retirement, or death in service.
2 Considering: Argentina, Australia, Bolivia, Cuba, France, Germany, Italy, Mexico, Netherlands, New Zealand, Paraguay, Portugal, Spain, United Kingdom, and Uruguay.
INTERNAL HIRING
In 2024, 76.0% of vacant positions were filled with
internal candidates.
In order to promote professional development
and internal mobility, LATAM group publishes all
available vacancies within the organization through
its internal communication channels. In this manner,
any employee who meets the requirements of the
position may apply.
Moreover, in the 'Work with Us' section of LATAM's
website, all positions that the company is looking
to fill globally are advertised.
› 118
LATAM
GROUP
2024
LATAM
GROUP
2024
› 119
07 / EMPLOYEES
01
BENEFITS
NCG 519: 5.7 POSTNATAL LEAVE AND 5.8 TRAINING AND
BENEFITS
GRI 401-2 AND 401-3
LATAM group’s affiliates offer their employees a
series of additional benefits that are not included
in the remuneration. Some of these are:
Stress management in the workplace1
LATAM group's Wellness Program focuses on stress
management in the work environment and on
promoting the overall well-being of its employees.
This consists of four main components: 1) Getting to
Know Each Other, which seeks to foster connections
among employees; 2) Travel Club, which offers
practical travel tips; 3) Wellness Tips, aimed at
improving mental, emotional and physical health;
and 4) LATAM Club, which provides discounts to
employees and their families in various categories.
This program is available through the LATAM Portal
and RH Connect, which streamlines its availability
and scope within LATAM group.
⚫ Getting to Know Each Other
This section offers the opportunity to meet and
connect with different people from LATAM group.
Each month, the profiles of up to two individuals
per country are published.
⚫ Travel Club
This section offers the presentations and recordings
of each live session where, month after month,
an employee of LATAM group showcases a new
destination of the world. Through their experience,
they share the best tips and recommendations to
inspire others to explore without limits, connecting
to the Staff Travel benefit.
⚫ Wellness Tips
A space where useful information and articles are
published each month designed to promote the
wellbeing, self-care and mental health of LATAM
group’s employees and their loved ones.
⚫ LATAM Club
Exclusive network of discounts and promotions for
LATAM group’s employees and their loved ones,
offering a wide range of benefits in all countries
and in more than ten categories, such as Hotel and
Tourism (with major hotel chains), Gastronomy,
Health and Fitness, Education and Training, among
others. In fact, as an employee of LATAM group,
it is also possible to access many of the discounts
available in other countries; not only in the country
of residence.
Wellness and health initiatives
Each LATAM group affiliate manages various initiatives
to promote physical activity among employees. For
example, in Chile, during the summer, employees are
invited to participate in a range of sports activities,
free of charge, organized at LATAM group’s facilities
under the name LATAM Park. This includes reserving
02
courts or pitches for various sports and enrolling
in classes, such as Zumba, functional training, or
spinning, among others.
In addition, all employees with permanent and fixed-
term contracts are provided:
⚫ Life insurance2
Aware of the importance of prevention in difficult
times and support for loved ones, LATAM group
offers its employees life insurance in most of the
countries where it operates.
⚫ Health insurance3
Given that employees’ health is a priority for LATAM
group, it provides private medical insurance that covers,
among other things, outpatient and inpatient medical
services, medicines and treatments. In addition,
in some countries like Chile, free telemedicine is
included in fields such as psychology, nutrition, sports
medicine, chronic disease support, sleep disorders,
sexual health and LGBT+ psychological counseling.
Also, in Chile, an agreement is offered with Colmena
for Isapre group plans, with preferential and fixed
prices.
⚫ Medical Care Insurance for business trips outside
the base country4
To ensure the well-being of its employees during the
performance of their duties, LATAM group provides
travel insurance to cover illnesses and accidents that
may occur while employees are away from their
country of residence. This insurance also extends to
crews—both cabin and flight crews—while performing
their duties.
Part-time work options
LATAM group offers part-time contracts for specific
roles, allowing employees to work fewer hours per
week in lieu of traditional full-time contracts. This
program is available in different countries, per their
local regulations.
Teleworking
Currently, all LATAM group support employees have
the option of working under a hybrid modality. In
addition, some specific roles, such as IT and Contact
Center teams, can work 100% from home due to the
nature of their functions. LATAM group companies
cover some expenses derived from hybrid work, such
as food and internet costs, per the regulations of
each country.
03
04
1 Benefit applies to all contract types in the countries with operations.
2 Benefit applies to all contract types in Chile, Ecuador, Argentina, Oceania and
Peru. In Colombia, it is offered based on union affiliation. On the other hand, in
Brazil, the U.S. and Mexico, it is offered to individuals with an indefinite con-
tract.
3 Benefit available to employees with an indefinite contract in Brazil, the U.S.
and Mexico and for all other contracts in other countries, except for New
Zealand, Bolivia, Uruguay, Germany, Netherlands and the U.K.
4 Benefit available in all countries and to all types of contracts.
07 / EMPLOYEES
Flexible work schedules
In certain countries and for specific positions, LATAM
group offers flexible working hours, adapted to local
regulations. This benefit allows employees to adjust
their start and end times based on their individual
needs and within the limits established by each
LATAM group affiliate.
Childcare facilities
Following the regulations of each country, LATAM group
provides childcare facilities for female employees after
the postnatal period, or offer childcare contributions
as an alternative for parents who work shifts or have
children with special healthcare needs.
Lactation facilities
LATAM group has dedicated lactation rooms in their
workplaces, providing privacy, comfort, storage and
hygiene for new mothers to express breast milk.
This program is available in different countries, per
their local regulations.
Maternity and paternity leave (postnatal)
LATAM group guarantees maternity and paternity
leave in accordance with the legal regulations of
each country where they operate, ensuring employee
well-being during the postnatal period.
Paid family care leave beyond parental leave
LATAM group ensures the availability of paid leave for
family care, in accordance with the legal regulations
of each country, to support their employees in family
situations that require additional care.
Ticket discounts benefit (Staff Travel)1
As part of its value proposition, LATAM group enables
its employees and their beneficiaries to visit the
world through the Staff Travel ticket benefit. Through
it, they obtain access to an annual coupon book on
routes operated by LATAM group to more than 150
destinations around the world, using tickets subject to
vacancy with a 100% discount (2), with a 90% discount
(12), with a 50% discount (12), and confirmed tickets
whose discount and number varies by sublevel. In
addition, workers have access to unlimited flights
with significant discounts on more than 90 airlines
with agreements. These coupons apply for each
worker and for each registered beneficiary according
to LATAM group’s policy.
05
06
07
08
09
10
Special benefits of the LATAM Pass frequent
flyer program2
Employees registered in the LATAM Pass program
have access to exclusive benefits that complement
the Staff Travel program, such as a mileage bonus
upon registration, double mileage accrual in the
purchase of Staff Travel tickets, and the option to
purchase tickets with miles. This benefit is available
in several countries and is being extended to all
countries where LATAM group operates.
Special benefits in ground handling services
offered by LATAM2
LATAM group also offers its employees discounts and
extra benefits on ground handling services available
to commercial passengers, such as double mileage
accrual on hotels and discount plus mileage accrual
on car rentals. For Chile, Brazil, Peru and Paraguay,
special discounts also apply to all other services,
such as tour packages, cruises, etc.
Loans3
LATAM group offers financial aid to its employees
through loans, which are available according to local
conditions and the collective bargaining agreements
of each affiliate. This benefit is designed to help
workers in various situations throughout their working
lives.
11
12
13
› 120
1 Benefit applicable to employees with an indefinite and fixed-term contract,
after six months in service in all countries with operations.
2 Benefit available to all contract types.
3 Benefit varies depending on the country (except for Brazil), type of loan, and
collective bargaining agreement.
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07 / EMPLOYEES
NCG 519: 3.1.VI GOVERNANCE FRAMEWORK AND 5.4.1
EQUITY POLICY
GRI 3-3; 405-1
LATAM group addresses diversity and inclusion
in a broad and integrated manner, formalizing its
commitment to non-discrimination and equity through
its Diversity and Inclusion Policy, Code of Conduct
and a Recruitment Policy, all of which promote
an inclusive environment and the appreciation of
individual talent.
GOVERNANCE
To carry out its commitment, LATAM group has
a clear structure for Diversity and Inclusion (D&I)
management, led by a global D&I Project Management
Officer (PMO), in coordination with LATAM group's
Vice-President of Human Capital. This figure ensures
the coherent implementation of D&I's global policies
and objectives, in alignment with corporate guidelines
and the organization’s vision.
In addition, there are individuals in charge of executing
D&I plans and initiatives. Their role includes direct
coordination with the local D&I managers (focals) in
each country where LATAM group’s companies operate,
as well as with the functional areas of the different
affiliates that collaborate in the implementation
of the necessary adjustments, ensuring corporate
alignment in this arena.
Meanwhile, LATAM group’s companies’ recruitment
and selection processes are supported by foundations,
organizations and specialized consultants to attract
diverse talent. In addition, as a guideline, it ensures
the presentation of candidates of both sexes in the
shortlists.
Moreover, a dedicated team is responsible for
promoting, measuring and managing D&I initiatives
to foster an inclusive and evolving work environment.
INCLUSION EVALUATION: MONITORING AND
CONTINUOUS IMPROVEMENT
LATAM group measures its progress in inclusion
through the periodic collection of employee opinions
in all the countries where it operates, which enables
it to analyze the different experiences and visions,
and to identify opportunities for improvement in
this arena. Additionally, once a year, it measures
employee perceptions of organizational systems and
experience through a tool managed by an external
consulting firm, which has shown a steady upward
trend.
D&I ORGANIZATIONAL CULTURE
LATAM group constantly seeks to strengthen
diversity and inclusion, with the aim of ensuring that
all individuals who are part of the organization can
fully contribute their capabilities. In fact, some of
the cross-cutting actions developed are:
I. Inform and educate employees to strengthen
the culture of inclusion.
II. Develop inclusive leadership.
III. Collect information that supports decision-
making and timely management of initiatives
to promote diversity and inclusion (D&I).
In its commitment to promote D&I, LATAM group
has defined specific goals that include increasing the
representation of women in leadership and technical
roles, as well as increasing the inclusion of people
with disabilities in various positions. In addition,
they seek to promote plurality in professional
profiles, ensuring that they reflect the diversity of
race, ethnicity, generations, sexual orientation and
gender identity, among other aspects, present in
the societies where they operate.
In this context, and in line with its diversity
commitments, which seek to achieve a 40/60 gender
balance at all functional levels by 2030, LATAM
group has made significant progress. Thus, LATAM
group has managed to bring more women to key
roles, such as pilots and maintenance mechanics,
reaching a total ratio of 39/60 by the end of 2024.
DIVERSITY AND INCLUSION
LATAM group aims to achieve a
gender balance of around 40/60 at all
functional levels by 2030.
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07 / EMPLOYEES
Employees by sex and functional category in 20241
GRI 405-1
NCG 519: 5.1.1 NUMBER OF PEOPLE BY SEX
Senior Management
Management
Leadership
Operators
Sales Force
Administrative staff
Other professionals
Other technicians
LATAM Group
58
434
1.164
12,043
185
355
1,713
7,294
23,246
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
MEN
0,25%
1,87%
5,01%
51,81%
0,80%
1,53%
7,37%
31,38%
100%
11
233
646
5,818
578
492
1,128
6,511
15,417
WOMEN
0,07%
1,51%
4,19%
37,74%
3,75%
3,19%
7,32%
42,23%
100%
PAY EQUALITY
NCG 519: 5.4.1 EQUITY POLICY AND 5.4.2 WAGE GAP
GRI 405-2
LATAM group implements clear policies and practices
that seek to ensure equal compensation among
employees, aligned with their roles and responsibilities.
In this regard, the policy is based on a job evaluation
methodology that uses a point and grade system
to determine the relative weight of each position.
In addition, LATAM group defines salary ranges
by grade based on market surveys, ensuring that
each employee is placed within the salary range
established for his or her grade. Along these lines, all
individuals belonging to the same pay grade share
a common income range, which stands between
80% and 120% of the corresponding level. However,
the specific positioning of each employee within
this range depends exclusively on factors such as
seniority, potential and performance.
In addition, LATAM group conducts an annual merit-
based compensation review based solely on individual
performance, reaffirming their commitment to
transparency and equity in compensation.
SALARY RATIO (WOMEN/MEN)1
NCG 519: 5.4.2 WAGE GAP
GRI 405-2
2024
AVERAGE2
MEDIAN3
Senior Management
97%
97%
Management
95%
97%
Leadership
95%
96%
Operators
92%
92%
Sales Force
103%
101%
Administrative staff
98%
98%
Other professionals
96%
98%
Other technicians
93%
94%
LATAM Group
95%
95%
Note: LATAM group has no employees in the "Auxiliary" category as defined by
Chilean NCG No. 519.
1 Proportion of women’s gross hourly wage vs. men’s gross hourly wage in each
functional category. Gross salary includes all fixed and variable pay, such as
base salary, social laws, bonuses, commissions, or others.
2 To calculate the mean, the average income by country, pay grade and seniority
category are considered, excluding data where there is no record for both sexes.
3 To calculate the median, the values of the gross hourly wages of women and
men are ordered from lowest to highest (considering the groups by country,
pay grade, and seniority category, and excluding data where there is no record
for both sexes), and the central value of the first group is divided by the central
value of the second group.
LATAM
GROUP
2024
07 / EMPLOYEES
Snapshot
GRI 401-1
2021
2022
2023
2024
Total employees
29,114
32,507
35,568
38,663
Turnover rate1
22.5%
11.4%
10.8%
9.8%
Voluntary turnover rate
5.1%
5.7%
4.4%
3.6%
Average hours of training2
36.3
42.7
49.9
46.4
Total individuals trained (% of total workforce)
N/D
30.6 thousand (93%)
32.1 thousand (90.4%)
36.3 thousand (94.1%)
Investments in training (% of revenues)
N/D
0.14%
0.12%
0.10%
OHI SURVEY
Result
77
77
78
79
Quartile
1
1
1
1
1 Total number of employees who left their position voluntarily, due to severance, retirement, or death in service/total workforce as at December 31, 2024.
2 Hours of training in the year/Average workforce.
More information
Employee profile (sex, nationality, age range, seniority
and people with disabilities): Annexes (Employees)
Postnatal leave: Annexes (Employees)
Formality of work (type of contract, type of work hours
and work flexibility): Annexes (Employees)
Freedom of association: Annexes (Employees)
Idle days due to work stoppages: Annexes (Employees)
Use of postnatal leave: Annexes (Employees)
Idle days due to work stoppages: Annexes (Employees)
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08 / COMMITMENT TO SUSTAINABILITY
07
_COMMITMENT TO SUSTAINABILITY
125 SUSTAINABILITY STRATEGY
132 ENVIRONMENTAL MANAGEMENT
140 CLIMATE CHANGE MANAGEMENT
151 CIRCULAR ECONOMY
159 SHARED VALUE
› 125
Governance for Sustainability Strategy
NCG 519: 3.1.II GOVERNANCE FRAMEWORK
LATAM group has established a solid governance
framework to ensure compliance with the purpose
of its Sustainability Strategy. In this regard, it is
the Board of Directors, through its Sustainability
and Strategy Subcommittee, who leads strategic
decision-making and supervises the results of this
area.
Likewise, on an annual basis, a presentation is made to
the Directors’ Committee and the Board of Directors
to report progress on the Strategy, addressing, among
other topics, LATAM group’s social responsibility.
At the executive level, the Sustainability Management,
under the Corporate Affairs and Sustainability
Directorate, is responsible for implementing the
strategy and reporting to the Sustainability and
Strategy Subcommittee. Along these lines, close
collaboration is fostered with the Corporate Affairs
and Sustainability leaders in each country, who
actively participate in its development and maintain
constant communication to review progress and
coordinate actions. In addition, at the local level,
program implementation is supported by specialized
teams with technical expertise in sustainability.
SUSTAINABILITY
STRATEGY
NCG 519: 4.2 STRATEGIC OBJECTIVES
GRI 305-5
In 2021, LATAM group presented its new Sustainability
Strategy, based on four fundamental pillars designed
to minimize environmental impacts and generate
social, environmental and economic value in the
countries where it operates. In addition, these pillars
are supported by an ambitious purpose and realistic
and well-structured work plans, which allow us to
continue moving forward in a manner consistent
with the path that LATAM group aspires to follow.
Along these lines, in its third year of implementation,
the Sustainability Strategy has evolved incorporating
lessons learned, the available scientific evidence
and regulatory and public policy definitions that
have been adopted by the authorities during this
period. Considering the above, LATAM group made
adjustments to the objectives of the climate change
management and circular economy pillars, maintaining
or raising the degree of ambition and adjusting to
the evolution of the regulatory and public policy
framework1, and the analysis of feasibility and
relevance of the various actions designed.
Although progress has been made in recent years
in terms of public policies and environmental
regulations, there are still significant gaps in terms of
climate action2 and the circular economy. Given this
uncertainty, over the next few years, the objectives
of the Sustainability Strategy will need to continue
being updated to comply with regulations.
1 Climate Change Management:: Colombia Tax Reform 2022 (Law 2277 of 2022), change of CORSIA baseline (ICAO Assembly 41, October 2022), establishment of the
Brazilian Emissions Trading System (Law No. 15,042 of 2024). Circular Economy: Regulations associated with reducing the production and consumption of single-use
plastics (Chile, Peru, Colombia, Ecuador, among others) (e.g.: Chilean Law 21,368, Sao Paulo, Brazil, Law 17,261 dated January 13, 2020, Peruvian Law 30,884, etc.).
Regulations on the handling of waste from international flights (e.g.: Decree 144 of 1996, Chilean Ministry of Agriculture). Regulations on sanitary control in airports and
aircrafts (e.g.: Resolução RDC nº 2, dated January 8, 2003).
2 Colombia's Climate Change Law has not been regulated, while Chile's Climate Change Law has not been fully regulated and, until December 31, 2024, only one country
has issued Corresponding Adjustments—a mechanism that allows carbon credits to be used in international emissions offsetting schemes, such as CORSIA.
ENVIRONMENTAL
MANAGEMENT
CLIMATE CHANGE
MANAGEMENT
Sustainability strategy pillars
CIRCULAR
ECONOMY
SHARED
VALUE
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GROUP
2024
08 / COMMITMENT TO SUSTAINABILITY
08 / COMMITMENT TO SUSTAINABILITY
PROGRESS OF THE SUSTAINABILITY STRATEGY
NCG 519: 9. SUSTAINABILITY, 9.1 SASB METRICS
Progress in 2024
Recertification under the IATA Environmental Assessment (IEnvA)
standard of the International Air Transport Association (IATA) with the
expansion of the scope in Chile, incorporating the Energy module.
100% compliance with Environmental Management System (EMS)
obligations and ISO 14001:2015 Certification with no major non-
conformities at the Miami base (United States).
Joint work program with critical suppliers in Chile, Brazil, Peru, Colombia
and Ecuador.
Current status
In 2024, LATAM group's Environmental Management System (EMS) was
significantly strengthened, reinforcing governance, staff engagement,
and teams’ technical capacity. In addition, the operations were certified
under rigorous international standards that contribute to the constant
improvement of environmental performance.
ENVIRONMENTAL MANAGEMENT
Ambition
To maintain and continuously improve the Environmental
Management System (EMS) across all LATAM group’s
operations under the IATA IEnvA standard1.
2024 Objective
To strengthen the implementation of the Environmental
Management System (EMS) within LATAM group.
1 The IATA Environmental Assessment (IEnvA) is a certification program
developed to independently assess the commitment of aviation stakeholders
to continuously improve their environmental and sustainability performance.
It is based on globally recognized standards and industry best practices, including the
ISO 14.001 environmental management system standard and the IATA Operational
Safety Audit (IOSA).
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08 / COMMITMENT TO SUSTAINABILITY
Progress in 2024
497,027 tons of CO2e emissions managed (19.9% through operational improvements;
i.e., emission reductions, and 80.1% by supporting the conservation of strategic
ecosystems, mainly in the Colombian Orinoco region; i.e., offsetting). The reduction
in tons managed was mainly due to the regulatory change that limited offsets
in Colombia. On the other hand, through LATAM's carbon offset program, its
customers offset a total of 39,314 tons of CO2e emissions.
Current status
LATAM group is redefining its approach to climate change management, focusing
on reducing Scope 1 emissions from airborne mobile sources, which represent
approximately 99% of the company's direct emissions3; i.e., reducing the amount
of carbon dioxide emissions per passenger/ton transported (emissions intensity),
favoring reduction over offsets. To this end, LATAM group is in the process of
redefining its commitments, which will be publicly announced during 2025. For
more information, please refer to the "Climate Change Management" section
of this document.
CLIMATE CHANGE MANAGEMENT
SASB TR-AL-110A.2
GRI 305-5
Ambition
⚫ To achieve net zero emissions growth in Direct emissions (Scope 1) using 2019 as
the base year.
⚫ To reduce and/or offset the equivalent of 50% of domestic greenhouse gas (GHG)
emissions1 by 2030, using 2019 as the base year.
⚫ To achieve net zero emissions by 2050.
2024 Objective
To reduce and/or offset 783,633 tons of CO2e, including carbon offsetting programs
with customers.
Since the launch of the Sustainability Strategy in 2021, the maturity and
understanding of climate change management in the industry has been evolving
at a fast pace, which implies that, to stay on track, we must assess the degree
of progress in the industry against new developments, such as the production of
sustainable aviation fuels (SAF)—particularly in the region—its projections and
the changing regulatory scheme2. Along the same lines, public policies associated
with this issue have also been changing. In some cases, by changing previously
existing regulations, as in the case of Law 1819 of 2016, which establishes the
carbon tax in Colombia and that, with the 2022 tax reform, changed the percentage
of emissions to which the non-taxation mechanism could be applied (limiting
emissions offsets to only 50%). Likewise, new regulations have been developed,
such as Law No. 14,993, which establishes the National Sustainable Aviation Fuel
Program (ProBioQAV) to reduce emissions through the use of SAF, and Law No.
15,042 of 2024, which introduces the Brazilian Emissions Trading System, both
in Brazil. In this dynamic context, LATAM group frames its work under climate
change management.
1 Domestic emissions includes Scope 1 aviation emissions, associated with fuel consumption by all passenger and cargo flights.
2 Only one country has issued Corresponding Adjustments—a key mechanism for carbon credits to be used in international offset
schemes such as CORSIA; however, the current supply of approximately 4.5 million tons of CO2e is insufficient against an estimated
demand of 107 to 161 million tons of CO2e between 2024 and 2026. In this context, Brazil has implemented relevant initiatives,
such as Law No. 14,993, which establishes the National Sustainable Aviation Fuel Program (ProBioQAV) to reduce emissions through
the use of sustainable aviation fuels (SAF), and Law No. 15,042 of 2024, which introduces the Brazilian Emissions Trading System.
3 Direct emissions, i.e., Scope 1 and 2, are considered for the calculation of the percentage. Does not consider Scope 3.
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08 / COMMITMENT TO SUSTAINABILITY
CIRCULAR ECONOMY
Ambition
To achieve the elimination single-use plastics.1
To become zero-waste-to-landfill2.
2024 Objectives
To achieve the elimination OF single-use plastics: To
ensure adherence to established guidelines and implement
new elimination opportunities.
To become zero-waste-to-landfill: To advance in
strengthening waste management systems and increase
waste diversion through reduction, reuse and recycling
strategies.
1 More information:
https://www.latamairlines.com/cl/es/sostenibilidad/economia-circular
2 See more in the "2024 Objectives Update" box, "Circular Economy" section.
3 Considering 11,000 tons of waste generated by LATAM group, per a baseline study
conducted in 2021 by SGS.
4 Waste diversion considers both waste recovered through composting and recycling,
and what has been reused and avoided, out of the total non-hazardous waste reported
in 2024.
Progress in 2024
Elimination of 97% of single-use plastics across the operation was achieved.
Update of the technical and operational feasibility assessment for landfill waste
diversion; definition of scope and objective for 2027.
Traceability of 47% of LATAM group’s waste3.
Diversion of 2,974 tons of waste from landfill, which is equivalent to 57% of the
total waste reported. This includes 307 tons of reuse and reduction and 2,667
tons recovered through recycling and composting.
Current status
A 97% reduction was achieved on our single-use plastic target, continuing with the
previous year's work plan. The remaining 3% corresponds to items not replaced
due to legal, sanitary or operational restrictions. See more in the 2024 Circular
Economy Objective Update.
In view of the 2027 target, LATAM developed a comprehensive assessment of the
recoverability potential in the main operations of Bogota (Colombia), Sao Carlos
(Brazil), and Santiago (Chile), added to the technical feasibility and infrastructure
throughout LATAM group's network, and it has decided to update its 2027 target,
with which it aims to achieve the diversion of 75% of waste from landfills. See
more in the 2024 Circular Economy Objective Update.
-97%
57%
Fewer single-use plastics
DIVERSION OF WASTE
from landfills4
Circular Economy Objectives Update
In line with the evolution of its Sustainability Strategy, LATAM group
has made adjustments to its objectives, balancing ambition with a
more mature and realistic approach, based on the feasibility of its
implementation in the region.
In its commitment to transparency, this box provides a breakdown of
the background and analysis of these decisions.
Zero waste by 2027: A 2027 objective is to achieve 75% diversion of
waste from landfills. This decision was based on the evaluation of
the maximum potential for waste recovery found in LATAM group's
operations, based on the assessment carried out at the facilities in Bogota
(Colombia), Sao Carlos (Brazil), and Santiago (Chile). In addition to the
above is the percentage of waste for which there is still no technical and
viable solution on the market, and the current state of LATAM group's
facilities where, in several cases, even at the municipal or airport level,
there are no waste management systems that allow for integration.
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08 / COMMITMENT TO SUSTAINABILITY
SHARED VALUE
Ambition
To make the connectivity, capacity, and speed of our
passenger and cargo operations available for the benefit
of communities across Latin America on three fronts:
Health
Environment
Natural disasters
2024 Objectives
To strengthen the network of strategic partnerships of
the Avión Solidario program.
To strengthen the structure of the Avión Solidario
program.
Progress in 2024
47 partnerships with organizations, foundations and government agencies in
five countries.
Nearly 5,000 patients, professionals, volunteers and specialists transported
free of charge.
Nearly 745 tons of cargo transported free of charge on behalf of social and
environmental causes.
Current status
The working pillars of the Avión Solidario program were established: LATAM
group’s management, communications, relations and interconnection.
The development of a methodology to measure the social and environmental
impact of the program (Social Return of Investment) was incorporated.
745
TONS OF CARGO TRANSPORTED FREE OF CHARGE
to aid social and environmental causes.
47
ALLIANCES WITH ORGANIZATIONS, FOUNDATIONS
AND GOVERNMENT AGENCIES
In 5 countries
4.877
PATIENTS, PROFESSIONALS, VOLUNTEERS AND
SPECIALISTS TRANSPORTED FREE OF CHARGE.
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08 / COMMITMENT TO SUSTAINABILITY
SUSTAINABILITY AMBASSADORS
PROGRAM
In order to engage our employees in the
strategy, LATAM group has a Sustainability
Ambassadors Program, which also contributes
to enhancing the results of the initiatives
implemented. Currently, there are more
than 700 active employees in the 5
countries where the company has its main
domestic operations.
SUSTAINABLE DEVELOPMENT GOALS (SDG)
NCG 519: 4.2 STRATEGIC OBJECTIVES
GRI 2-23
LATAM group is committed to the Sustainable
Development Goals (SDGs) for 2030, established by
the United Nations in 2015. In this regard, the pillars
of the Sustainability Strategy contribute mainly to
eleven of them.
Partnerships for
the goals
Peace, justice
and strong
institutions
Life on
land
Good health and
well-being
Gender
equality
Clean water
and sanitation
Affordable and
clean energy
Decent work and
economic growth
Industry, innovation and
infrastructure
Climate
action
Responsible
consumption and
production
3
5
6
7
8
9
12
13
15
16
17
08 / COMMITMENT TO SUSTAINABILITY
HUMAN RIGHTS
NCG 519: 2.1. MISSION, VISION, PURPOSE AND VALUES;
3.1.II GOVERNANCE FRAMEWORK 4.2. STRATEGIC
OBJECTIVES
GRI 2-23 AND 3-3
In order to generate social, environmental and
economic value, LATAM group assumed in 2018 a
public commitment to respect Human Rights. This
document lists the ten principles that should govern
the conduct of its employees, collaborators and third
parties. These include the rejection of child labor,
forced labor or labor in conditions similar to slavery,
as well as any form of discrimination, moral, physical
or sexual harassment. Likewise, it reaffirms its
commitment to freedom of association, occupational
health and safety, fair remuneration, decent working
conditions and the promotion of equality regardless
of gender, race, age, sexual orientation, religion or
nationality.
This commitment was designed following international
guidelines, such as the Universal Declaration of
Human Rights, the United Nations International
Charter of Human Rights and the Fundamental
Principles and Rights at Work of the International
Labour Organization (ILO). In addition, , it sets forth
the envisaged consequences in case of breach.
It should be noted that, while LATAM group does
not currently have specific policies on indigenous
rights and protection of the cultural heritage in
place, no impacts from its operations on indigenous
communities or the cultural heritage have been
identified. Likewise, LATAM group is in the process of
developing ongoing monitoring of its environmental,
social and governance (ESG) risks and impacts, and is
evaluating the possibility of creating and/or adjusting
internal processes to meet these needs.
In this context, LATAM group has an ethics channel
available to everyone who interacts with the
organization, including Board members, employees
and stakeholders. This channel, which is continuously
monitored by the Compliance department, enables
the detection of possible Human Rights violations. If
a report is confirmed, action plans are implemented
to assist affected individuals and groups, which may
include training, feedback, suspensions, contract
terminations, legal action or other relevant measures.
See more in “Corporate Guidelines”.
In addition, LATAM group has internal procedures in
place that include mitigation measures to prevent
risk situations, and remediation processes when
necessary.
PARTICIPATION IN THE UNITED NATIONS
GLOBAL COMPACT
LATAM group is a member of the United Nations
Global Compact, an initiative that promotes the
adoption of fundamental values in human rights,
labor relations, the environment and anti-corruption
in business practices. Nonetheless, it has not formally
adhered to the United Nations Guiding Principles on
Business and Human Rights.
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ENVIRONMENTAL
MANAGEMENT
LATAM group's environmental management pillar
is governed by the Safety, Quality, Health and
Environment Policy. This public document is
reviewed on an annual basis and its commitments
include: compliance with current environmental
legislation, international agreements and/or any
other commitment voluntarily signed by any LATAM
group company in terms of Operational Safety,
Safety for the Protection of Civil Aviation, Quality and
Environment, including environmental aspects such
as energy and water consumption, GHG emissions,
and pollution prevention, among others.
Therefore, the main focus of the environmental
management pillar is to ensure compliance with
applicable environmental regulations, while managing
risks and opportunities related to LATAM group's
activities and processes.
In order to face a changing environment in an
agile manner, LATAM group has implemented an
Environmental Management System (EMS) designed
to improve environmental performance and comply
with current regulations, which is transparent,
auditable and certified.
Along these lines, LATAM group implements its
Environmental Management System (EMS) under
the IATA Environmental Assessment (IEnvA) standard
of the International Air Transport Association (IATA),
in which nine passenger and cargo carriers in Brazil,
Chile, Colombia, Ecuador and Peru are certified
The main focus of the environmental management pillar
is to ensure compliance with applicable environmental
regulations, while managing risks and opportunities related
to LATAM group's activities and processes.
under the Corporate Activities, Flight Operations
and Maintenance scope.
IENVA AND ISO 14001 RECERTIFICATION
In November 2024, an external audit was conducted
for recertification under this standard, maintaining the
scope of administrative activities, flight operations,
and aircraft overhaul, maintenance and repair at nine
carriers across their local markets. This recertification
also included the incorporation of the energy module
of the IATA IEnvA standard for the three carriers
of the Chilean affiliate, which reinforces LATAM
group's commitment to constant improvement in
environmental management.
In addition, LATAM group achieved ISO 14001:2015
recertification at its Miami affiliate in the United
States, covering air cargo transportation and aircraft
maintenance services, including organizational
activities (ORG), maintenance activities (MNT), cargo
and warehousing activities (CGO) and safety, security
and environmental activities (SEC).
NEW GOVERNANCE
In order to strengthen environmental governance,
LATAM group has established the Environmental
Management deputy office, part of the Sustainability
department, which in turn reports to the Corporate
Affairs and Sustainability directorate. This structure
facilitates a more efficient and coordinated
management of environmental resources and
objectives. In addition, in LATAM group's local market
affiliates, the Sustainability leaders are responsible
for ensuring compliance with the environmental
objectives in their respective affiliates, together
with the operational areas, reporting both directly
to the local Corporate Affairs managers and to the
Environmental Management deputy office. In turn,
the local Corporate Affairs managers report to the
country general manager, who is the lead operator
of that affiliate in the EMS.
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ENVIRONMENTAL COMPLIANCE
NCG 519: 8. LEGAL AND REGULATORY COMPLIANCE, 8.3
ENVIRONMENTAL
An essential part of an Environmental Management
System (EMS) certified under international standards
such as the IATA Environmental Assessment (IEnvA)
or ISO 14001:2015 is compliance with environmental
legal obligations. In LATAM group, this process is
managed continuously through a cycle of planning,
execution, verification and improvement.
First of all, the regulations being drafted by the
various state bodies in the countries where LATAM
group operates are monitored to identify the legal
requirements applicable to the company’s activities.
These requirements are incorporated into the
corresponding matrices and, subsequently, compliance
is evaluated within the established deadlines and
forms. Throughout this process, LATAM group has
the support of the internal legal team and external
lawyers specializing in environmental matters.
With regard to environmental matters regulated
in local markets, LATAM group includes water, air
(atmospheric emissions, noise), energy, waste,
hazardous substances and environmental contingencies.
Meanwhile, in 2024, in the Chilean affiliate, it is worth
noting the enforcement of the Economic Crimes Law,
which criminalizes environmental offenses, and the
Energy Efficiency Law.
At the same time, in order to verify compliance with
environmental regulations applicable to its activities
and the international standards adopted, in 2024,
LATAM group continued with the program of inspections,
environmental emergency drills and internal audits.
In addition, internal and external audits of the IEnvA
standard and an external audit were conducted as
part of the ISO 14.001:2015 certification to ensure
the continuity of its commitment to constant
improvement in environmental management.
Environmental
Management
System
SAFETY, QUALITY, HEALTH & ENVIRONMENT POLICY
The Safety, Quality, Health and Environment Policy has a cross-sectional coverage:
⚫ Production operations and commercial facilities
⚫ Products and services
⚫ Distribution and logistics
⚫ Waste management
⚫ Suppliers, service providers and contractors
⚫ Due diligence, mergers and acquisitions
The company's commitments include the following:
⚫ Ensure environmental protection
⚫ Prevent pollution
⚫ Efficiently manage the carbon footprint
⚫ Operate under a circular economy approach
⚫ Establish objectives and resources
⚫ Periodic review of environmental performance
⚫ Comply with applicable environmental legislation in each affiliate where
we operate
⚫ Implement and maintain an Environmental Management System (EMS)
with a focus on constant improvement of environmental performance
This policy is approved by the Board of Directors and signed by LATAM group's CEO. In
the case of affiliates in Brazil, Colombia, Ecuador and Peru, it is additionally signed by
the country’s CEO.
08 / COMMITMENT TO SUSTAINABILITY
LATAM
GROUP
2024
› 134
COMPLIANCE MODELS
NCG 519: 8. LEGAL AND REGULATORY COMPLIANCE, 8.3 ENVIRONMENTAL
All LATAM group’s affiliates have an environmental management procedure and
program to identify and evaluate compliance with applicable environmental
obligations, according to the activities performed in each country and by carrier
(passengers and cargo).
In 2024, the environmental risk matrix was updated for all LATAM group affiliates,
incorporating a comprehensive assessment covering environmental, community,
legal and regulatory, economic, reputational and biodiversity dimensions.
Compliance with legal requirements and deadlines for the implementation of
actions depend on the corresponding regulations. All areas of LATAM group,
under the leadership of the Environmental Management team, are responsible
for ensuring regulatory compliance.
The progress of compliance with the environmental obligations across LATAM
group is reviewed periodically by the Environmental Management, Corporate
Affairs, Legal and Risk teams.
LATAM group's environmental management pillar contributes directly to the
United Nations Sustainable Development Goals (SDGs), specifically SDG 6 (Clean
Water and Sanitation), SDG 7 (Affordable and Clean Energy), SDG 12 (Responsible
Consumption and Production), SDG 13 (Climate Action) and SDG 15 (Life on
Land), supporting global sustainability through its operations and strategies.
Responsible
consumption
and production
Affordable and
clean energy
-Clean
water and
sanitation
Climate
action
Life on land
FINES, ENFORCEABLE PENALTIES AND
ENVIRONMENTAL RESPONSIBILITY
NCG 519: 8. LEGAL AND REGULATORY COMPLIANCE, 8.3
ENVIRONMENTAL
GRI 2-27
In 2024, under the reporting of environmental
processes required by General Rule (NCG) No. 519,
LATAM group has no fines outstanding and had
three enforceable sanctions and/or an accumulated
environmental responsibility at the end of the year1
totaling CLP$1,6182. On the other hand, the three
compliance programs approved in previous years
remain in place, with no compliance programs
executed or completed in 2024. Last, it is worth
mentioning that there are no remediation plans for
environmental damage presented or implemented
in the year of this report.
12
13
15
7
6
1 Considering the Public Sanctions Registry of Chile’s Superintendency of the
Environment (Superintendencia del Medioambiente) and equivalent agencies in
other jurisdictions.
2 The fine in reals totals R$10,000. Converted to Chilean pesos, this translates
into CLP$1,612,800 at the exchange rate established by the Central Bank of
Chile as at December 2024 (R$1 is equivalent to CLP$996.46).
08 / COMMITMENT TO SUSTAINABILITY
LATAM
GROUP
2024
› 135
08 / COMMITMENT TO SUSTAINABILITY
NATURAL RESOURCES
LATAM group seeks to minimize its environmental
impact through responsible management of natural
resources, implementing efficiency measures in
energy and water consumption. Along these lines,
it prioritizes efficient water management, adopting
advanced technologies and monitoring programs to
optimize water use and reduce consumption. These
actions reinforce its commitment to sustainability,
seeking to balance its operations with care for the
environment.
Likewise, the energy used by LATAM group is acquired
through the energy grids of each country where
it operates, which means that the proportion of
renewable and non-renewable sources reflects the
most recent information on the energy composition
of each nation, distributing consumption according
to its specific weight.
Water
Aware of the importance of water as an essential
resource for social development and ecosystem
conservation, and in view of the water crisis affecting
many sectors across Latin America due to the effects
of global warming, LATAM group is committed to
implementing measures to ensure the efficient use
of this resource. These actions are grouped into the
following categories:
Analysis of water use to identify opportunities for
water efficiency improvements
In the five countries where LATAM group has
domestic operations, by identifying the sources
of water for human and industrial consumption, in
order to move towards a life cycle analysis of this
resource. Although these sources are usually located
in concession areas within airports, where pipeline
maintenance and improvements to prevent leaks
are not the direct responsibility of LATAM group,
preventive and corrective maintenance programs
are developed at its own facilities to minimize leaks
and ensure efficient use of the resource.
Actions to reduce water consumption
More efficient equipment has been acquired, such as
energy-efficient washing equipment used in to wash
aircraft parts, tires and ground handling equipment.
Other initiatives include the implementation of
infrastructure improvements at its facilities, such
as low-flow faucets and timers in sinks, showers,
dining areas and operations.
Improvement of wastewater quality
All wastewater generated by LATAM group is treated
either internally, using separation chambers and
treatment plants, or externally, by concessionaires
and/or local municipal wastewater treatment plants.
Water recycling
At the Line Maintenance Center (CML, for its Spanish
acronym) in Brazil, a rainwater harvesting and storage
system has been implemented for use in internal
processes, thus reducing the extraction of fresh
water.
Water efficiency training and awareness
As part of the Environmental Management System
(EMS) training program, periodic sessions are held to
instruct employees on responsible water consumption
and conservation.
Water extraction and consumption1
GRI 303-3
CSA- WATER CONSUMPTION
100% corresponds to fresh water.
UNIDAD
2021
2022
2023
2024
Extraction: Total municipal water supply
Million cubic meters
0.099
0.086
0.272
0.189
Extraction: Fresh water (lakes and rivers, etc.)
Million cubic meters
0
0
0
0
Extraction: Groundwater
Million cubic meters
0
0
0
0.076
Discharge: Water returned to its source of
extraction, at a higher or similar quality to that
extracted
Million cubic meters
0
0
0
0.004
Total fresh water consumption
Million cubic meters
0.099
0.086
0.272
0.262
1 Supply is obtained from the municipal networks of the various countries of operation, without LATAM group’s direct collection of water.
08 / COMMITMENT TO SUSTAINABILITY
Energy
In its ongoing commitment to comprehensive process
optimization, improving energy efficiency is a key
priority for LATAM group, as it contributes directly
to the reduction of greenhouse gas emissions, which
is one of the main environmental impacts of the
operation. Therefore, LATAM group has implemented
various actions and programs designed to reduce
energy consumption responsibly.
Audits to identify energy performance improvements:
During 2024, three carriers of LATAM group’s Chilean
affiliate implemented an Energy Management System
that included two internal and two external audits.
The internal audits included one conducted by an
external company authorized by the Ministry of
Energy and another conducted by the International
Air Transport Association (IATA), in the context of the
energy module of the IATA Environmental Assessment
(IEnvA) program. On the other hand, the external
audits were also carried out by an external company
authorized by the Ministry of Energy and by IATA, as
part of the evaluation of the IEnvA energy module.
Energy-saving objectives:
The determination of energy objectives is explained
in the Environmental Management System (EMS)
Manual. In the case of aviation operations and fuel
use management, LATAM group has a program for the
reduction and efficient use of fuel, and in the case
of energy consumed in ground handling, there is a
specific environmental management program within
the framework of the implemented Environmental
Management System (EMS).
Actions to reduce energy consumption:
According to the energy baseline, the highest energy
consumption comes from flight operations, and
initiatives to reduce this consumption are led by the
Fuel Management, in an integrated effort with all
areas of LATAM group, including Operations, Fleet,
Maintenance & Airports, and IT, among others.
In addition, ground handling has implemented initiatives
aimed at energy efficiency, such as promoting the
use of natural light in new facilities, installing motion
sensors, and using climate control in air conditioning
systems, among others.
Electricity consumption and energy intensity
GRI 302-1 AND 302-3
2021
2022
2023
2024
63,379
57,419
44,177
53,562
Energy intensity
(MWh/100 FTE1)
2.2
1.7
1.2
1 Acronym for "full-time employee”.
Consumption
(MWh)
Energy efficiency training:
To continue strengthening the culture of energy
performance improvement, during 2024, training
on energy efficiency was conducted mainly for
employees of the Chile and Ecuador affiliates.
0.9
› 136
LATAM
GROUP
2024
LATAM
GROUP
2024
› 137
08 / COMMITMENT TO SUSTAINABILITY
Internal energy consumption
GRI 302-1
CSA - ENERGY CONSUMPTION
UNIT
2021
2022
2023
2024
NON-RENEWABLE ENERGY
Jet Fuel
TJ
88,734.84
133,991.16
156,368.83
178,292.50
Gasoline
TJ
24.32
162.53
5.16
68.62
Diesel
TJ
118.5
67.49
111.2
117.05
Liquefied petroleum gas
TJ
5.41
8.75
366.17
7.22
Natural gas
TJ
0.11
0.02
N/A1
N/A
Electricity2
TJ
50.47
21,772
136.25
95.09
Total non-renewable energy
TJ
88,933.70
134,251.72
156,987.61
178,580.48
RENEWABLE ENERGY
Ethanol
TJ
0.56
0
0.08
0.01
Electricity2
TJ
177.87
184.99
22.79
97.73
Total renewable energy3
TJ
178.43
184.99
22.87
97.74
TOTAL
TJ
89,112.08
134,436.71
157,010.48
178,678.22
1 In 2023, Natural Gas is not part of the energy sources used by LATAM group.
2 The electricity consumed comes from various sources, and the share of each source varies annually, depending on the composition of each country's power grid.
3 In previous years, the proportion of renewable energy in each country's energy mix was considered to calculate LATAM group's renewable consumption, since energy is acquired
through these grids. However, as of 2023, only energy that has certificates attesting to its renewable origin is reported as renewable energy.
4 Based on information on the composition of the energy mix of each country where LATAM group operates, with H2LAC as the source; this is a program created in 2020 by
Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) together with the World Bank, ECLAC, and the European Union’s Euroclima+ Program.
Fuel consumption
SASB TR-AL-110A.3
NCG 519: 9 SUSTAINABILITY-9.1 SASB METRICS
CSA - FUEL CONSUMPTION FOR PASSENGERS AND CARGO TRANSPORTATION
UNIT
2021
2022
2023
2024
Fuel efficiency
Liters/100 RTK
31.7
30
29.8
29.2
Passenger operations
Liters/100 RTK
3.4
3.7
3.1
3.0
Cargo operations
Liters/100 RTK
20.1
22.1
23.1
23.1
Fuel Consumption
GJ
88,734,840
133,991,160
156,368,834
178,292,500
Percentage of alternative fuels
%
0
0
0
0
Percentage of sustainable fuel
%
0
0
0
0
RTK: Acronym for “revenue ton-kilometers”.
Electric energy consumption4
2024
Renewable sources
27,147 MWh
50.68%
Non-renewable sources
26,413 MWh
49.32%
Renewable sources
Non renewable sources
50.68%
49.32%
LATAM
GROUP
2024
08 / COMMITMENT TO SUSTAINABILITY
LOCAL AIR POLLUTANTS AND NOISE
With regard to air pollution, LATAM group goes
beyond compliance with the emission regulations in
force in the countries of the region. Initiatives have
been developed to reduce local pollutants, including
the installation of filters in stationary sources within
paint and sanding booths, among others.
During 2024, electromobility continued to be developed
with the replacement of mobile support equipment at
the maintenance operations in Miami, and a project
was developed for the renewal of electric forklifts at
the Cargo base in the same city, which is scheduled
for implementation in 2025.
As for noise, environmental noise measurements
are taken in accordance with the frequency and
methodology established in the different regulations
in force in the various countries. In addition, in
August this year, a voluntary environmental noise
measurement campaign was carried out in Sao
Carlos, Brazil.
Waste
GRI 306-3
UNIT
2021
2022
2023
2024
Total waste generated
t
2,571
2,799
5,047
7,867
Percentage of non-hazardous waste
YEAR
NON-HAZARDOUS WASTE
2021
75%
2022
79%
2023
76%
2024
66%
Percentage of hazardous waste
YEAR
HAZARDOUS WASTE
2021
25%
2022
21%
2023
24%
2024
34%
Note: The waste reported on this page corresponds to solid waste for which LATAM group has disposal records
as evidence for support or control of its handling. In this sense, the distribution presented does not reflect the
total waste generation of LATAM group, mainly because, at several facilities, the waste sent to landfill is not
weighed and/or the company or institution in charge does not provide supporting disposal records. At the same
time, LATAM group is working to improve the traceability of the handling of all its waste so, in the future, these
values could experience variations, especially as reliable records are collected from other posts or generations
of waste managed by third parties.
› 138
LATAM
GROUP
2024
› 139
Waste disposal in 2024
GRI 306-3, 306-4 AND 306-5
CSA - WASTE DISPOSAL
UNIT
HAZARDOUS
NON-HAZARDOUS
TOTAL
Waste not intended for disposal
t
258
2,790
3,048
Preparation for reuse
t
123
307
429
Recycling1
t
134
1,995
2,129
Other recovery operations1
t
2
488
490
Waste intended for disposal1
t
2,435
2,384
4,819
Incineration (with energy recovery)1
t
228
184
412
Incineration (no energy recovery)1
t
140
10
150
Transfer to landfill1
t
1,989
2,190
4,179
Other disposal operations1
t
78
-
78
Total waste
t
2,693
5,174
7,867
1Offsite.
Note: The waste data comes mainly from the information generated at the bases where LATAM group has own operations, as well as those places where it is possible
to access this information. Waste management is part of the Environmental Management System (EMS), in which the points of generation are identified, waste is
classified according to type and composition, properly stored and, finally, transferred to an external recipient for recycling or final disposal. The traceability of this
process is essential, as it is directly related to regulatory compliance.
08 / COMMITMENT TO SUSTAINABILITY
CLIMATE CHANGE MANAGEMENT
NCG 519: 9. SUSTAINABILITY- 9.1 SASB METRICS
GRI 3-3
SASB TR-AL-110A.2
The climate emergency is one of the greatest global
challenges of our time and is expected to pose a crucial
challenge for humanity in the years to come. In this
context, the aviation industry faces the challenge
of acting decisively, contributing to both mitigating
and adapting to climate change.
Aware of this and of its responsibility to the
communities it connects as well, LATAM group
seeks to shift towards net zero emissions by 2050
in a sustainable manner for the environment, the
communities it serves and the business. Indeed,
LATAM group has focused on prioritizing those
routes that are currently available while promoting
those that are not yet available. Thus, since 2010,
as part of its corporate fuel efficiency program,
LATAM group has implemented significant operating
improvements to reduce its emissions through more
efficient fuel consumption, achieving a cumulative
efficiency of 7% and avoiding the emission of more
than 5.6 million tons of CO2e.
Likewise, LATAM group is also reducing its emissions
through the incorporation of new technologies,
such as the latest generation of aircraft, which can
reduce emissions by 20% to 25%, according to the
manufacturer. In addition, by 2030, LATAM group
expects to have 200 state-of-the-art aircraft, thus
succeeding in having more than 50% of its fleet be
this type of aircraft.
One of the main tools for shifting towards net-
zero emissions is the use of sustainable aviation
fuels (SAF). These are non-conventional aviation
fuels created from different raw materials, such as
used cooking oil, municipal waste, and vegetable
oils, among others. In addition, they must meet
strict sustainability criteria, ensure a reduction of
emissions, not compete with food security, and not
lead to deforestation, among other requirements.
Thus, together with Airbus, LATAM financed a study
conducted by MIT which, in addition to seeking to
generate information as input for public policies,
indicates as one of its conclusions that government
policies and mechanisms are needed to promote
SAF in the region.
Therefore, LATAM group has developed a project
designed to promote the incorporation of these
fuels into the energy transition roadmaps of the
countries where it operates. The aim is to encourage
their production and contribute to the generation of
enabling conditions that permit the incorporation
of those measures that are not currently available.
On the other hand, after a thorough consultation with
academics, experts, and non-profit organizations,
among others, LATAM group also incorporated into
its strategy, as a complementary measure, emissions
offsets, favoring nature-based solutions, keeping in
mind that South America is a unique region in terms
of its ecosystems and biodiversity, home to some
of the most important ecosystems in the world,
such as the Amazon, Patagonia, and the Cerrado,
among others, but does not necessarily have enough
resources to preserve them. Thus, LATAM group’s aim
is that, through joint public-private work, suitable
public policies and international agreements for
emissions management, incentives will be generated
to preserve these ecosystems.
Considering the above, LATAM group has made
significant progress on all fronts related to climate
change management, developing a specific plan for
each of them. However, given the current context,
where the enabling conditions for CORSIA compliance
have not yet been established and the production
of SAF has not yet been consolidated in the region,
there is a need to update the strategy. This will make
it possible to adapt it to this dynamic and challenging
environment, thus ensuring the achievement of
concrete and sustainable results.
› 140
LATAM
GROUP
2024
08 / COMMITMENT TO SUSTAINABILITY
LATAM
GROUP
2024
› 141
08 / COMMITMENT TO SUSTAINABILITY
CONTEXT CHANGES
Adequate climate change management in an industry
such as aviation, which is considered difficult to abate,
according to the Intergovernmental Panel on Climate
Change (IPCC), requires efforts across the whole
value chain. In fact, they should include incremental
improvements in efficiency and contribute to the
generation of enabling conditions for the deployment
of the necessary tools for the industry.
Along these lines, the roadmaps consider efficiencies,
new technologies, SAF and, as a complementary
measure, market-based initiatives for offsetting
emissions that cannot be reduced. These are carried
out through projects with the highest technical
standards to guarantee their integrity and at the
same time generate co-benefits for the communities
that implement measures associated with carbon
reduction and/or capture.
In this context, LATAM group presented the renewal
of its Sustainability Strategy in 2021, following
a series of roundtables with experts, academics,
shareholders and other stakeholders. Moreover,
based on the scientific information available at the
time and in line with the industry’s commitments,
LATAM group defined purposes that, in addition to
prioritizing emissions reduction, incorporate ecosystem
compensation and protection in South America as
a complementary pathway.
Among the assumptions used to establish the
roadmap was that, by mid-decade, the region would
have an initial production of SAF. In turn, according
to forecasts from the International Civil Aviation
Organization (ICAO) in its Long-Term Ambitious Goal
(LTAG) scenario, the region would contribute around
5% of the world's SAF.
Thus, with the firm conviction of contributing to the
generation of this market, LATAM group announced
that it would seek to have 5% of SAF in its operations
by 2030, favoring production generated in South
America. However, to date, there are as yet no
plants/refineries producing SAF in the region, so the
first batch of SAF has not been produced and is not
expected to be produced in the short term.
On the other hand, LATAM group relied on the Carbon
Offsetting and Reduction Scheme for International
Aviation (CORSIA), approved and signed in 2016 by
the 191 member states of ICAO. This scheme aimed
to enable air carriers, through the use of SAF and
CORSIA-eligible emissions units (CEUs, also known
as carbon credits), to reduce or offset the additional
emissions they generate on international routes,
based on a baseline.
The baseline of the scheme was initially the industry's
average emissions on international routes in 2019
and 2020. However, due to the impact caused by
COVID-19, in June 2020, ICAO decided to use 2019
emissions as its new baseline. Later, in October
2022, the baseline was adjusted again, taking 85%
of 2019 emissions.
For this scheme to be possible, two conditions must
be met:
⚫ That the projects they generate (CEUs)
follow the methodology of an ICAO-approved
record or program.
⚫ That the host countries of such projects issue
what is known as a Corresponding Adjustment
(CA). These adjustments consist of a letter
issued by the countries, in which they guarantee
that these CEUs will not be taken into account
in the national inventory. Therefore, they are
not included in the compliance of the Nationally
Determined Contribution (NDC) or national
emission reduction objectives, so they can
be used for compliance with international
schemes such as CORSIA.
Currently, only one country (Guyana) has issued the
corresponding adjustments, making available to the
market approximately 4.6 million tons of CO2, an
insufficient figure, considering the forecast needs for
the first stage of the scheme (2024-2026). In fact,
according to IATA, these are between 107 and 161
million tons of CO2. In addition, to date, no other
country has signed the corresponding adjustments
required for the scheme.
On the other hand, within the eligibility criteria for
issuing eligible emissions units (CEUs), ecosystem
conservation projects that generate more than
7,000 carbon credits (i.e., projects that avoid and/
or sequester more than 7,000 tons of CO2e) are
excluded from the scheme, with the exception
of those projects known as "jurisdictional", which
are those spanning expanses at the level of one
or more jurisdictions, and which typically involve
active government participation. These projects
are associated with methodologies for reducing
greenhouse gas emissions from deforestation and
forest degradation, conservation and enhancement of
carbon stocks and sustainable forestry management.
However, to date, there are as yet no plants/
refineries producing SAF in the region, so the
first batch of SAF has not been produced and is
not expected to be produced in the short term.
LATAM
GROUP
2024
08 / COMMITMENT TO SUSTAINABILITY
Ecosystem conservation projects are a tool to curb
the main cause of greenhouse gas emissions in
some Latin American countries (between 40% and
50% for Brazil, Colombia and Peru). Therefore, its
limitation within CORSIA makes it difficult for the
aviation industry to contribute significantly to the
conservation of key ecosystems in the region, such
as the Amazon, Cerrado, and Atlantic Forest (Mata
Altantica), among others.
In a region like South America, where air connectivity
plays a key role for society, allowing segments of
the population to access fundamental rights such
as health and education, LATAM group aims to shift
towards net zero carbon emissions by 2050, in a way
that is sustainable for the environment, the business
and, above all, the communities it serves.
To achieve that balance, and aware of both the urgency
of climate action and the advances in science and
and ambition while demonstrating a greater level
of maturity and understanding of the challenges
associated with climate change management.
Lastly, LATAM group is committed to making public its
updated climate change management commitments
during 2025.
knowledge on climate change management in the
industry, it is important to highlight several factors.
Firstly, the initial assumptions on which the pillar's
commitments were established have not only failed
to materialize, but have also increased in uncertainty,
which has led to new challenges to the implementation
of effective strategies. Second, the evolution of
available technologies and the development of new
metrics have enabled a deeper understanding of
emissions and their impact. In addition, increasing
regulatory pressure and stakeholder expectations
require the adoption of more dynamic and adaptive
approaches.
Given the above, LATAM group has decided to shift
towards more specific commitments and metrics
focused on reducing the intensity of carbon emissions,
ensuring a more realistic and measurable approach
aligned with the industry's current capabilities.
Thus, and in view of the most recent advances in the
global climate agenda and particularly in the airline
industry, LATAM group is redefining its approach
to climate change management, focusing on the
reduction of Scope 1 emissions, which constitute
around 99% of direct emissions. The aim is to
reduce the amount of carbon dioxide emissions
per passenger/ton transported, favoring reduction
over offsetting. In this way, LATAM group aims to
maintain its leadership position in the region and
globally in terms of climate change management,
sustaining and even increasing levels of investment
LATAM group aims to shift towards net zero carbon
emissions by 2050, in a way that is sustainable for
the environment, the business and, above all, the
communities it serves.
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GROUP
2024
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LATAM GROUP CLIMATE CHANGE MANAGEMENT
Operating Efficiency
Implementation of several initiatives to optimize fuel use, both in aviation and ground handling. These include route
optimization, rationalizing the use of auxiliary engines and reducing flight weight, among other measures.
New Technologies
Progress in fleet renewal and incorporation of new technologies, such as AeroShark. In the medium term, the company
plans to have approximately 200 state-of-the-art aircraft.
Sustainable Aviation Fuels
(SAF)
Support studies that promote information-based public policies, stressing the need to unify approaches to decarbonization
in the region. This includes government instruments to encourage the production, use and marketing of SAF, secure
investments and align with international measures such as CORSIA.
Equally, to integrate customers into the climate change management strategy through the use of SAF in its operations.
Offsetting Emissions
Participation in emissions offsetting programs as a complementary measure to the work plan focused on emissions
reduction; this front prioritizes conservation projects in strategic ecosystems across Latin America. These initiatives rely
on the collaboration of customers, non-government organizations (NGOs) and other key stakeholders.
The climate change management pillar of LATAM group's sustainability strategy contributes
to the United Nations Sustainable Development Goals (SDGs), particularly SDG 13 (Climate
Action), SDG 15 (Life on Land) and SDG 17 (Partnerships for the Goals).
13
15
17
08 / COMMITMENT TO SUSTAINABILITY
08 / COMMITMENT TO SUSTAINABILITY
JOINT EFFORT
In the aviation sector, effort coordination is
fundamental, as technological solutions necessary
for the transition to a low-carbon-emissions energy
model are not yet available on a large scale or are in
the pilot stages. In this context, LATAM group has
worked to align itself with the main international
standards and agreements to contribute effectively
to this transformation.
CORSIA
In 2016, the Carbon Offsetting and Reduction Scheme
for International Aviation (CORSIA), a global initiative
whose purpose is to reduce the greenhouse gas
emissions (GHG) of international civil aviation, was
established. This agreement is being structured in
three stages: pilot (2021-2023), first phase (2024-
2026) and second phase (2027-2035). During the first
two stages, and until 2026, countries’ participation
is voluntary. In this regard, 115 countries took part
in the pilot phase, while 126 are participating in the
first phase.
For the compliance period of the first phase (2024-
2026), new programs have been incorporated that
can issue eligible compensation units (ECUs), in
addition to those previously approved, such as the
American Carbon Registry (ARC) and Architecture
for REDD+ Transactions (ART). In addition to these,
there are four other programs: Gold Standard (GS);
Verified Carbon Standard, or Verra (VCS); Global
Carbon Council (GCC) and Climate Action Reserve
(CAR).
Despite these additions, currently only one project is
fully eligible under CORSIA. This is because projects
must meet two key requirements: (1) be registered
in a program and under a methodology approved by
ICAO, and (2) have a Letter of Authorization (LOA).
This letter, issued by the host country of the project,
ensures that the compensation units generated
will not be counted within the country's Nationally
Determined Contributions (NDCs), thus ensuring that
no double accounting occurs.
In this context, although CORSIA was an agreement
signed by 191 countries, only one country currently
has the appropriate processes in place for the issuance
of LOAs and one eligible project under the scheme.
This poses a significant challenge in ensuring the
availability of the carbon credits needed to meet
the scheme's objectives.
On the other hand, LATAM group participated
in the different forums promoted by ICAO, such
as the "LTAG Stocktaking Event on Aviation CO2
Emissions Reductions", to continue promoting and
expressing the need for Letters of Authorization
or corresponding adjustments—a necessary figure
for the compensation units to be eligible under the
agreement, and which must be issued by the host
countries of the projects.
Islas Galapagos, Ecuador
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Conservation of ecosystems and preservation
of biodiversity
GRI 3-3: MANAGEMENT OF MATERIAL TOPICS
Within LATAM's climate change management pillar,
two key aspects are the conservation of strategic
ecosystems and the preservation of biodiversity. In
line with these objectives, LATAM group supports
projects that contribute to these purposes, leveraging
the carbon sequestration potential of these
initiatives and advancing on offsetting emissions as
a complementary measure.
During 2024, in line with the development of LATAM
group's sustainability strategy, the Biodiversity and
No-Deforestation Commitment has been signed, with
the purpose of contributing positively to preservation
in the areas of influence, seeking a net positive
impact (NPI) on biodiversity. This includes minimizing
the negative impacts of operations and promoting
responsible practices within the organization. In
addition, efforts have been made to prevent the
acquisition of products or raw materials from illegally
deforested areas.
Co2bio initiative
In 2024, LATAM group continued with the CO2Bio
alliance, an initiative of the Cataruben Foundation of
Colombia and 338 families in the Orinoco Region of
that country. This alliance focuses on the conservation
and restoration of flooded savannas and forests—
areas recognized for their high capacity to sequester
carbon dioxide, their biodiversity, and the benefits
they bring to local communities.
During 2024, the company worked on structuring
the initiative's governance system, strengthening
its corporate governance to streamline the decision-
making process. In addition, compliance processes
were consolidated and communication mechanisms
were improved through two-way channels.
The CO2Bio project, located in the Orinoco Region
of Colombia and supported by the Natural Wealth
Program of the United States Agency for International
Development (USAID), has had the following
achievements in 2024:
⚫ To conserve 278,903 hectares of areas of
great environmental importance, equivalent to
about twice the size of cities such as Bogota
or São Paulo.
⚫ To benefit 338 families in the area.
⚫ To contribute to the protection of roughly
2,000 species, some of them considered
endangered, threatened or vulnerable.
With these efforts, LATAM group reiterates its
commitment to the sustainability and environmental
protection of the region.
Emissions offsetting (1 + 1 scheme)
Aiming to contribute to the protection of the environment
and ecosystems in a collaborative manner, and to
engage its customers in these initiatives, LATAM
group offers its corporate customers, both in its
cargo and passenger operations, the opportunity to
participate in the offsetting of emissions generated
on their flights.
In this context, LATAM group developed its 1+1
offsetting program, which allowed customers to choose
from a portfolio of projects with high environmental
value, previously verified and validated by LATAM
group, to offset the emissions generated by their air
travel. Along these lines, for each ton of emissions
that the customer decides to offset, LATAM group
matches the amount offset, multiplying the positive
impact of the measure.
The projects driven by LATAM group promote both
environmental sustainability and the social and
economic development of local communities.
First sustainable financing
In 2024, LATAM group signed its first Sustainability-
Linked Loan for US$300 million, becoming the first
airline group in South America to adopt this innovative
type of financing. This agreement—the first of its kind
for LATAM group—consists of a revolving credit line
signed with Crédit Agricole Corporate & Investment
Bank and BNP Paribas. It is linked to sustainability
objectives that allow access to prime rates based
on the carbon intensity reduction performance of
its operations, measured in tons of CO2 emitted per
revenue tons-kilometer (RTK).
This key milestone strengthens LATAM group's
sustainability strategy and bolsters its commitment
to achieve net zero emissions by 2050.
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EMISSIONS REDUCTION: LATAM FUEL
EFFICIENCY
NCG 519: 3.1.II GOVERNANCE FRAMEWORK
GRI 3-3
LATAM Fuel Efficiency is LATAM group's corporate
program designed to optimize operational efficiency
and reduce fuel consumption to generate savings
and minimize greenhouse gas emissions.
The impact of LATAM Fuel Efficiency has consolidated
LATAM group as one of the most efficient airlines in
terms of emissions intensity, measured in tons of CO2
per revenue ton-kilometer (RTK). In fact, according to
data from the International Air Transport Association
(IATA) and public data, LATAM group is approximately
12% below the industry average, reaffirming its
leadership in climate change management.
1 Source: IATA Net Zero Progress Report 2022
CO2e
+7%
in aviation fuel use efficiency
saved in 2024
SAVED 10,34
million gallons of fuel
98,984
TONS OF CO2e
Achievements from 2010 to 2024
This commitment is bolstered by various initiatives:
⚫ Improving load factor through
projects to eliminate unnecessary
weight during flights; for example,
the in-flight water program, which
consists of optimizing the load of
potable water on the aircraft.
⚫ In 2024, LATAM group began
renewing the paint on its A320
and A321 fleet, incorporating low
resistance paints, and began installing
AeroShark technology on 5 aircraft
in its B777 fleet, with the aim of
reducing friction and cutting fuel
consumption by 1%.
⚫ Implementation of an in-flight
entertainment system with Wi-Fi
that allowed the removal of overhead
screens from the A320 fleet, reducing
weight and improving the passenger
experience.
⚫ Connecting aircraft to clean energy
sources and using ground power units
(GPU) to reduce auxiliary engine
(APU) consumption.
⚫ Replacement of auxiliary power
units (APU) and upgrades to optimal
configuration, to minimize fuel
consumption while they are in use
and cannot be connected to external
units. In addition, the engines are
washed to maintain their operation
with greater efficiency.
⚫ Implementation of advanced
analytics models to reduce flight
distance and time, optimizing routes
both in flight planning and operation,
and therefore, fuel consumption.
⚫ Standardization of the reserve fuel
policy throughout LATAM group.
Thanks to these initiatives and a focus on continuous
improvement, LATAM group has not only achieved
greater operational efficiency, but also reaffirms its
commitment to innovation and sustainability in the
airline industry.
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TCFD
Since 2022, LATAM group began the process of
incorporating the recommendations of the Task
Force on Climate-related Financial Disclosures
(TCFD). The initiative seeks to consolidate best
practices in climate risk management and to help
standardize climate disclosures for all companies.
More information
LATAM Airlines Group 2024 TCFD Report
SUSTAINABLE AVIATION FUELS (SAF)
NCG 519: 3.1.II GOVERNANCE FRAMEWORK AND 3.6.IV RISK
MANAGEMENT
According to the International Air Transport
Association (IATA), SAF can reduce emissions by up
to 80% compared to traditional fuels, poised to be
a key solution to make aviation operations more
sustainable. However, their adoption faces significant
challenges. These include high costs—which are 2
to 5 times higher than conventional jet fuel—and
limited supply, representing significant barriers. In
fact, according to IATA data from 2024, the production
of SAF barely represents 0.3% of global jet fuel
consumption. Moreover, there is no local production
in Latin America, despite the potential of countries
such as Brazil and Colombia, with experience in
biofuels, and Chile, with promising prospects in the
production of green hydrogen.
Public-private collaboration in the region
To help overcome these obstacles, LATAM group is
actively collaborating with various players in the
public and private sectors in the region, promoting
the development of the SAF market and fostering
public policies adapted to local realities. Examples
of these efforts include participation in initiatives
such as the SAF Technical Roundtable in Colombia
and the public-private roundtable on Sustainable
Aviation Fuels in Chile, within the framework of the
Vuelo Limpio (Clean Flight) program, whose purpose
is to reduce emissions through collaboration and
sectoral innovation.
Developments in 2024:
Purchase of more than 900,000
gallons of SAF for LATAM
group’s operations
The fleet renewal included 13
Ferry Flights (flights to transfer aircraft between
bases and maintenance centers) in collaboration
with Airbus, using SAF.
*Reduction of
6.000
tons of CO2e
6AGREEMENTS
for the use of SAF
08 / COMMITMENT TO SUSTAINABILITY
08 / COMMITMENT TO SUSTAINABILITY
Joint study with MIT and Airbus
Faced with the shortcomings in the development
and production of SAF, LATAM group has proposed
to contribute from its role with different players in
the generation of enabling conditions. One of the
key elements for this is to have technical science-
based assessments for decision making. To move
toward this objective, in collaboration with Airbus,
it funded an independent study in 2023, developed
by the Massachusetts Institute of Technology (MIT)
Joint Program on Sustainability Science and Strategy.
The report, entitled "Sustainable Decarbonization
of Aviation in Latin America" and published in
December 2024, stresses the importance of having
various forms of government support to enable the
transition to effective decarbonization. Indeed, one
of the main findings indicates that the use of SAF
could reduce current aviation emissions in Latin
America by up to 60% by 2050, in an "Accelerated
Actions" scenario, where the world moves towards
stabilization of global warming at 1.5°C.
The study also estimates that achieving 65% use
of SAF by 2050 will require accrued investments
of US$204 billion between 2025 and 2050 in six
key countries: Brazil, Chile, Colombia, Ecuador,
Mexico and Peru. It also stresses the need to unify
regional strategies, such as Sustainable Aviation Fuel
(SAF) and carbon trading agreements, to minimize
the impact of additional costs on demand. This
collaborative approach is crucial, as some countries
have competitive advantages to produce SAF at a
lower cost, which would allow them to export, while
others could benefit as importers.
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CARBON FOOTPRINT
NCG 519: 9. SUSTAINABILITY- 9.1 SASB METRICS
SASB: TR-AL-110A.1.
GRI 305
CSA - GHG EMISSIONS
LATAM group monitors its impacts on climate change
and the results of reduction initiatives through the
greenhouse gas inventory, which is conducted annually
based on ISO 14.064 and the GHG Protocol.
Along this line, in 2024, emissions totaled 16,556,047
tons of CO2e—up 13.21% from 2023—which,
compared to the consolidated capacity growth of
15.1%, shows an increase in efficiency. LATAM group's
GHG emissions in 2024 are mainly concentrated in
direct emissions (Scope 1), which represent 79% of
the total footprint, 99% of which comes from jet fuel
consumption. This is followed by indirect emissions
(Scope 3), which constitute 21% of the total footprint,
with 79% associated with jet fuel consumption. On
the other hand, indirect emissions from electricity
consumption (Scope 2) represent less than 1% of
the total footprint.
In terms of emissions intensity, the total operation
recorded a reduction of 3.02% while, specifically
in air operations, the decrease was 2.48%, both
figures compared to 2023. This reduction responds
to the significant improvements that LATAM group
implemented in its operational efficiency, including
the use of advanced analytics for flight route
optimization and the use of advanced technologies
such as AeroShark, which improve the aerodynamics
of its aircraft. This is in addition to the fleet renewal
plan, in which 14 last-generation aircraft were
incorporated, which consume between 20 and 25%
less fuel, according to the manufacturer's data. These
efforts are reflected in the reduction of emissions
intensity per passenger and cargo, demonstrating
LATAM group's focus on reducing emissions.
In 2024, LATAM group achieved a reduction of 98,984
tons of CO2e thanks to the LATAM Fuel Efficiency
program and offset 398,043 tons of CO2e through
carbon credits from conservation projects.
Specifically, the offset was carried out through the
project located in the Orinoco Region in Colombia,
registered in the BioCarbon Registry, which uses the
BCR0002 methodology for quantifying greenhouse
gas emission reductions in REDD+ projects2.
1 Project ID: PCR-CO-635-141-001.
2 In the 2023 annual report, 674,513 tons of CO2e offset were declared;
however, the correct figure is 442,178 tons of CO2e. The difference is due to an
erroneous recording of offsets associated with the carbon tax in Colombia, which
were recorded in the wrong year.
Challenges for 2025
Continue to strengthen fuel efficiency programs to
maintain and improve the achievements to date.
Make progress in the coordination of preservation
and restoration projects in strategic areas of Latin
America.
Strengthen the agenda for the development and
use of Sustainable Aviation Fuels in Latin America.
TOTAL
16,556,047
tCO2e
7,604,958
Brazil
3,718,649
Chile
854,884
Colombia
290,463
Ecuador
2,511,031
Peru
67,803
Paraguay
1,508,259
LATAM Group's cargo
airlines1
TOTAL BY COUNTRY (tCO2e)
TOTAL BY SCOPE (tCO2e)
13,118,183
Scope 1
(direct emissions)
4,663
Scope 2
(Indirect emissions from
electric energy purchases)
3,433,201
Scope 3
(Other indirect emissions –
value chain)
Carbon footprint in 2024
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08 / COMMITMENT TO SUSTAINABILITY
Breakdown of scope 3 indirect emissions
GRI 305-3
CSA - GHG EMISSIONS (SCOPE 3)
UNIT
2023
2024
Goods and services purchased
tCO2e
380.599
482,084
Capital goods
tCO2e
251.032
132,625
Activities related to fuel and energy (not included in Scopes 1 or 2)
tCO2e
2.390.446
2,724,356
Upstream transport and distribution
tCO2e
56.606
57,169
Waste generated in operations
tCO2e
1.373
3,400
Business travel
tCO2e
1.055
1,780
Employee commutes
tCO2e
13.656
31,787
Upstream leased assets
tCO2e
N/A
Downstream transportation and distribution
tCO2e
N/A1
N/A
Processing of products sold
tCO2e
N/A
N/A
Use of products sold
tCO2e
N/A
N/A
End-of-life treatment of products sold
tCO2e
N/A
N/A
Downstream leased assets
tCO2e
N/A
N/A
Franchises
tCO2e
N/A
N/A
Investments
tCO2e
N/A
N/A
Others upstream
tCO2e
N/A
N/A
Others downstream
tCO2e
N/A
N/A
1 Data corrected in relation to the 2022 Annual Report. In 2023 and 2024, no activity is identified in this category.
Activity comparison 2022-2024
CSA - GHG EMISSIONS
SCOPE 1
(tCO2e)
SCOPE 2
(tCO2e)
SCOPE 3
(tCO2e)
2022
9,780,288
7,150
3,198,317
2023
11,524,420
5,217
3,094,768
2024
13,118,183
4,663
3,433,201
Other emission indicators
GRI 305-4
UNIDAD
2022
2023
2024
Intensity Scope 1
kg CO2e/1OO RTK
76.67
76.16
74.27
Intensity Total footprint
kg CO2e/1OO RTK
101.8
96.65
93.73
Intensity of net emissions in the total operation
kg CO2e/1OO RTK
97.02
92.19
91.48
More information
⚫ Greenhouse gases: Inventory, emission factors and scope of information (Annexes - Commitment to sustainability, p. 268 y 269).
⚫ Significant atmospheric emissions (Annexes - Commitment to sustainability, p. 269).
CIRCULAR ECONOMY
GRI 3-3, 306-1AND 306-2
Since the announcement of its sustainability strategy
in 2021, LATAM group has made progress on several
initiatives to ensure that its processes are aligned
with the principles of circular economy and that the
waste generated is managed responsibly. Within this
framework, LATAM group has set two challenging
goals: to eliminate single-use plastics in its operations,
and to become a zero-waste-to-landfill group.
In the last few years, the organization has made
significant progress in reducing single-use plastics and
transitioning to reusable, recyclable and/or renewable
and/or biodegradable alternatives. This approach has
integrated various departments across the board to
coordinate efforts to modify key processes, from the
design of the travel experience to daily operations,
with a common purpose: to move towards circular
economy.
A "Zero Waste Roadmap" was established, which
includes specific actions based on the type of
management and operation—internal or outsourced—
and considers expanding the coverage of the Waste
Management System by incorporating new facilities
and contractual clauses with key suppliers. In addition,
the strategy reinforces measurement, monitoring
and traceability processes, adapts procedures and
encourages the diversion of waste1 from landfills,
prioritizing reduction, reutilization and recycling as
fundamental pillars.
1 Non-hazardous solid waste
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ADJUSTMENT OF OBJECTIVES
In 2024, LATAM group thoroughly revised its objective
of seeking to be zero-waste-to-landfill by 2027,
which led to a more precise objective of diverting
75% of non-hazardous solid waste from landfills
in its own operations. This definition responds to
operational challenges associated with limited access
and insufficient waste management systems in the
airports and geographic areas where it operates. In
addition, due to its composition, a significant part of
the waste does not have viable technical alternatives
for recovery outside of sanitary landfills.
In view of the above and maintaining the focus on
this matter, LATAM group continues to strengthen
its waste management system, actively collaborating
with authorities and concessionaires to promote the
development of appropriate conditions for waste
recovery. In addition, it remains committed to
initiatives such as "Segundo Vuelo" (Second Flight)
and "Recicla tu Viaje” (Recycle Your Trip), which are
part of its comprehensive strategy in this arena.
Definition of zero waste to landfill1
According to the United Nations Development Program, the "zero waste"
concept seeks to reduce pollution, preserve resources and minimize the
amount of waste. It does not imply the total elimination of waste, but
rather a long-term commitment to minimize waste generation. Indeed,
not generating any waste, strictly speaking, is incredibly difficult, if
not downright impossible in today’s society , so the focus is on making
conscious decisions to reduce waste from the stage of design through
reuse, repair and recycling. In this regard, LATAM group's objective is
to continuously reduce waste generation, with the aim of progressively
moving towards a zero-waste model.
1 See more information at:
https://www.undp.org/es/historias/objetivo-cero-desechos-3-aspectos-que-debes-desmitificar
9
17
12
8
LATAM group’s Circular Economy pillar contributes actively to the fulfillment
of four of the United Nations’ (UN) Sustainable Development Goals (SDGs):
SDG 8 (Decent Work and Economic Growth), SDG 9 (Industry, Innovation and
Infrastructure), SDG 12 (Responsible Consumption and Production) and SDG 17
(Partnerships for the goals).
08 / COMMITMENT TO SUSTAINABILITY
WASTE DIVERSION ROADMAP
LATAM group's roadmap for waste diversion from
landfills considers differentiated measures based
on the type of handling and operation, whether in-
house or outsourced.
Among the strategies to be followed, LATAM group will
continue to strengthen and incorporate new facilities
into its Waste Management System, advancing in
the inclusion of supplier contract clauses for waste
management and recovery and in the creation of
strategic alliances with key suppliers.
This approach will be complemented by actions aimed
to generate awareness, reduce the use of materials,
encourage reusable and/or recyclable materials,
and redesign processes and services, among other
initiatives.
1 Non-hazardous solid waste.
2 The scope of Circular Economy includes non-hazardous solid waste that can be sent to landfills according to current regulations in each country and for which LATAM
Group has disposal or weighing records as support. In this sense, the distribution presented does not reflect the total generation of this waste, mainly because, at several
facilities of the operations, the waste sent to landfill is not weighed and/or the company or institution in charge does not provide supporting disposal records. In addition,
LATAM group is working on improving the process for controlling its waste generation. The fee for waste diversion includes the following treatments: reduction and reuse,
recycling, composting and incineration with energy recovery.
3 The breakdown of waste management can be found in the Environmental Management section. In addition, the figures reported here represent 41% of LATAM group’s
waste, estimated according to the SGS baseline.
Non-hazardous waste disposal (tons)3
In order to achieve the target of waste diversion1
from landfill by 2027, LATAM group will focus on
the following opportunities:
⚫ Expand the coverage and strengthen the processes
within the waste management system in LATAM
group's own operations.
⚫ Increase diversion of waste from landfill through
programs based on the 3 Rs: Reduce, Reuse and
Recycle, in passenger and cargo operations.
⚫ Encourage a cultural shift within LATAM group to
promote the active collaboration of each employee.
⚫ Reinforce and expand the Recycle Your Trip and
Second Flight programs (both explained below).
⚫ Continue to strengthen alliances with catering
suppliers to optimize in-flight service waste
management.
● Tons of non-hazardous solid waste generated
● % of waste recovered
2021
2022
2023
2024
40%
40%
1,916
1,916
48%
48%
2,164
2,164
53%
53%
3,845
3,845
57%
57%
5,174
5,174
1,000
2,000
3,000
4,000
5,000
0
Evolution of non-hazardous solid waste2
6.000
5,000
4,000
3,000
2,000
1,000
0
Total waste
generated
Reduction and
reutilization
Waste sent to
treatment
Recycling
Incineration with
energy recovery
Incineration
without energy
recovery
Landfill
Composting
WASTE (t)
5,174
5,174
-307
-307
4,867
4,867
-1,995
-1,995
-488
-488
-184
-184
-10
-10
-2,190
-2,190
GRI 2-4
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CIRCULAR ECONOMY PROGRAMS AND INITIATIVES
GRI 306-2
Waste Management System at our operating bases
With expert advice, LATAM group has implemented improvements to its Waste
Management System (WMS) in its main operations. These improvements include
the incorporation of infrastructure for waste management and segregation,
the implementation of recovery and recycling processes for various materials,
training and the creation of monitoring systems to evaluate key indicators.
In addition, the WMS continues to promote a cultural change and engagement
within LATAM group. Guidelines and training have been developed for employees,
promoting awareness and adherence to the new processes linked to the circular
economy, actively driven by the company's senior management.
5,174
TONS OF WASTE GENERATED
2,667
TONS OF WASTE
RECOVERED
51% of the waste generated.
307
TONS OF WASTE
REDUCED AND REUSED
6% of the waste generated.
2,974
TONS OF WASTE
DIVERTED
57% of the waste generated.
Results of Circular Economy 2024
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WASTE REDUCTION AND RECYCLING AT
LATAM CARGO
LATAM Cargo has implemented several initiatives to
reduce and recycle waste such as plastic and wood:
⚫ Recycled plastic pallets: In Santiago (Chile), conventional
wood and plastic pallets were replaced with high-
density recycled plastic pallets, avoiding the disposal
of approximately 30 tons of waste per year.
⚫ Air cargo blankets: In Chile and Brazil, stretch film
has been replaced by polypropylene or reusable plastic
blankets to protect cargo during its various transfers
between warehouses and to the foot of the aircraft. In
addition to reducing 56 tons of plastic per year, it also
saves assembly and depalletizing time.
⚫ Plastic optimization: In Lima (Peru), stretch film was
replaced by reusable air cargo netting, while in Miami
(United States), traditional stretch film was replaced by
a recyclable plastic layer that reduces the number of
plastic layers from three to one (except in case of rain).
FÉNIX PROJECT: RECOVERING DISUSED
AIRCRAFT PARTS
LATAM group launched the "Fénix" project in 2023,
whose purpose is to recover aircraft parts to be used
as internal spare parts, sold or reused by LATAM
group or third parties. At the end of 2024, the project
achieved the recovery and sale of 1,467 aircraft parts
for operational inventory. This initiative reduced aircraft
on ground (AOG) recovery time and diverted more than
46 tons of landfill waste.
Outstanding initiatives:
⚫ Reception and meeting room areas (Miami, United
States): Aircraft components recovered from passenger
to freighter conversion, used as new furniture.
⚫ Reconditioning of seat belts: In partnership with
suppliers, used belts are collected, repaired and
reincorporated. In 2024, this practice was expanded
from Chile to Ecuador.
⚫ Repair and recertification of life jackets: In Chile
and Brazil, life jackets are inspected, reconditioned and
recertified, extending their useful life.
RECYCLE YOUR TRIP: IN-FLIGHT WASTE
RECYCLING
LATAM Group has been implementing the "Recycle
Your Trip" program since 2019, with the aim to recycle
catering waste generated on domestic flights. In Brazil,
Chile and Peru, segregation of PET bottles is carried out
by the in-flight crew while, in Colombia and Ecuador,
segregation of aluminum, PET and Tetra Pak containers
is carried out on the ground by the airports of Bogota
and Quito, respectively.
In 2024, the segregation and recycling of Tetra Pak
containers was incorporated into the program in Chile
and Brazil. This allowed more than 280 tons of plastic
bottles and Tetra Pak containers to be recycled.
280
TONS OF WASTE
recycled in 2024
123
TONS OF PLASTIC
were reduced in 2024, 32%
more compared to 2023.
270
TONS OF PLASTIC
RECYCLED.
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SECOND FLIGHT: UNIFORM UPCYCLING
Since 2018, the “Second Flight” program allows LATAM
group to give a second life to its employees' disused
uniforms, transforming them into new products. This
initiative not only reduces the impact on the environment
by converting textile waste into new items, but also
contributes to the construction of a more sustainable
community through strategic partnerships, employment
generation, and the promotion of responsible consumption.
⚫ 22 tons of disused uniforms delivered
⚫ 11 organizations from Brazil, Chile, Peru, Colombia,
Ecuador and Paraguay.
⚫ 36,500 new products created.
In 2024, the Second Flight program earned LATAM
Airlines Peru an award at the XVth Edition of the
Corresponsables Awards in Spain, in the Large Company
category.
MORE SUSTAINABLE LOUNGES
In 2024, at the Lounge in Santiago (Chile), LATAM,
together with its strategic suppliers Newrest and Nuevo
Pudahuel, implemented waste segregation and recovery
processes for paper, cardboard, PET bottles, aluminum,
glass, Tetra Pak containers and organic waste, both in
the lounge areas and in the kitchens.
Based on the achievements obtained, a best practices
guide was developed to replicate these processes in
other LATAM group lounges.
These actions seek to obtain the TRUE (Total Resource
Use and Efficiency) certification from the U.S. Green
Building Council, which requires diverting at least 90%
of waste from landfills. In 2024, the pre-certification
process for the Santiago Lounge began.
During 2024, 430 tons of waste were recorded, 250
tons of which were recovered. Of this amount, 132
tons corresponded to organic waste, which was sent
to a composting plant, and 118 tons were destined for
recycling.
DONATIONS
In 2024, LATAM group donated a variety of items to
support different causes and communities. In total,
more than 30,000 elements were distributed in Brazil,
Chile, Peru, Ecuador and Colombia, benefiting both
organizations and employees affected by contingencies.
Among the items donated were 4,200 blankets, 800
caps and hats, and 72 jackets, 490 neck pillows, 470
coats and jackets, and 320 toys.
It is worth mentioning that, in September 2024, 6.7
tons of recovered materials were destined only to the
employees affected by the severe floods in Rio Grande
do Sul (Brazil).
OTHER INITIATIVES
⚫ Sustainable seat covers: Since 2018, recycled leather
made from offcuts that were to be discarded has been
used. 130,000 m² were used, covering 62% of the fleet
and avoiding 21 tons of waste.
⚫ New canteen in Bogota (Bogota, Colombia): materials
from maintenance and loading were incorporated into
the furniture of the new canteen.
22
TONS OF DISUSED UNIFORMS
delivered
132
TONS CORRESPONDED TO
ORGANIC WASTE
which was sent to a composting plant
30,000
ITEMS WERE DONATED
to support different causes
and communities
62%
OF THE SEATS ON ITS FLEET ARE
UPHOLSTERED IN RECYCLED LEATHER
representing 130 thousand m2
3,93
FEWER TONS OF WASTE
to landfill.
Reduce
Reuse
Recycle
08 / COMMITMENT TO SUSTAINABILITY
REDUCTION OF FOOD WASTE
Reduction of food waste
LATAM group has developed a comprehensive strategy to
address food loss and waste, with actions and objectives
defined according to the source of generation.
In-flight catering
The In-Flight Service area is leading a strategy to reduce
catering (fresh food) waste through various initiatives:
i. Reinsertion of non-perishable materials and sealed
foods into the operation.
ii. Zero Waste Project (perishable food): reduction of
over-stocking of fresh food in the Economy cabin, using
artificial intelligence that analyzes data to improve the
accuracy of the amount of food needed.
Results of this implementation in 2024:
Canteens and Lounges
In 2024, the Lounge in Santiago (Chile) implemented
processes for weighing, segregation and recovery of
organic waste from uneaten food and discards from
the dining areas and kitchens.
Meanwhile, at the maintenance base and CAE training
center canteens in Santiago (Chile) and at facilities in
Lima (Peru), LATAM group carries out the segregation
of food waste generated by the employees themselves,
which is then processed by composting.
2024 results of this initiative:
See breakdown of the initiatives and programs in the Annexes section.
-60%
over-stocking vs. 2023
Avoided waste of:
312,000
catering (fresh food)
services equivalent
78
TONS OF WASTE
iii. Preselect: Pilot program launched allowing Business
cabin passengers on international routes to select their
preferred catering option 48 to 24 hours before their
flight.
Likewise, LATAM group is developing a model focused on
passengers who choose not to use the service, especially
on long-haul night routes. These routes, which usually
take off late, have passengers who tend to prioritize
rest because they have already had dinner before the
flight. This new model is scheduled to be implemented
in 2025.
Objective
In 2024, LATAM set the objective of limiting catering
over-stocking (fresh food) in the Economy cabin on
international flights of more than 3.5 hours to a maximum
of 2%, equivalent to approximately 212 tons per year.
By 2025, this target will be extended to higher cabins,
setting a target of 2.8%.
240
TONS OF FOOD WASTE
sent to composting.
› 157
LATAM
GROUP
2024
LATAM
GROUP
2024
› 158
08 / COMMITMENT TO SUSTAINABILITY
SINGLE-USE PLASTICS
GRI 306-2
LATAM group has become the first in the airline
industry1 to eliminate 97% of single-use plastics2.
This achievement involved significant changes in
Business and Economy cabins, airports, lounges,
cargo, maintenance and offices.
Although LATAM group had initially planned to
eliminate 100% of single-use plastics by 2023, by
2024 it had achieved a 97% reduction in single-
use plastics according to the defined Scope4. The
remaining 3% corresponds to a set of elements
that could not be replaced or eliminated for legal,
safety, sanitary or operational reasons, or because
there were no alternatives available on the market.
Still, LATAM group reiterates its commitment to
keep improving and will continue to work on finding
solutions to reduce its waste, replace materials with
reusable, recyclable, biobased and/or biodegradable
ones, broadening its scope and strengthening the
knowledge of its waste.
1 According to the internal review of Skytrax and Corporate Sustainability Assessment (CSA) 2023 Reports of leading airlines.
2 See more information: https://www.latamairlines.com/cl/es/prensa/comunicados/el-camino-eliminar-plasticos-un-solo-uso
3 In countries where regulations permit.
97%
of single-use plastics eliminated up to 2024
-1,738
tons of single-use
plastics
-272
million plastic bags
(equivalent)
SINGLE-USE PLASTICS
Business Cabin
⚫ Replacement of wrappers to cover rest elements with reusable cotton
bags.
⚫ Elimination of the wrappers that covered slippers and contained the
elements inside the amenity kits.
⚫ Toothbrush replaced with a bamboo toothbrush, and socks and eye
covers now contain recycled material.
⚫ Replacement of plastic pan lids with sugarcane-based lids.
Economy Cabin
⚫ Plastic cups were replaced with paper cups, plastic utensils with
bamboo and disposable pans with reusable ones.
⚫ Plastic bags for rest items were replaced with paper tapes3, and
separator bags in the aircraft trolley compartments were eliminated.
Airports
⚫ New labels and courtesy bags made of paper were implemented.
Lounges
⚫ Replacement of plastic toothbrushes with bamboo.
⚫ Replacement of plastic spoons and stirrers with reusable metal
spoons.
⚫ Elimination of plastic bags from towels and amenities.
⚫ Incorporation of anti-sneeze screens to replace stretch film on food
(Bogota).
Maintenance and
offices
⚫ Plastic bags were replaced by trolleys, trays and paper bags for
transporting aircraft maintenance items.
⚫ Plastic cups were replaced with paper or reusable cups in offices.
SHARED VALUE
GRI 3-3 AND 203-1
The shared value pillar reflects the path that LATAM
group has traveled with its communities, seeking to
work collaboratively to be an asset that drives social
and environmental development in South America.
In this context, the Avión Solidario program has been
the flagship program of this pillar, allowing LATAM
group to make itself available to communities and
offer a space for contribution through connectivity,
supporting health, environmental and natural disaster
response needs.
For thirteen years, the program has been operating
in alliance with strategic partners in Brazil, Chile,
Colombia, Ecuador and Peru, impacting thousands of
people each year. Its strength lies in LATAM group's
teams, foundations and partner organizations, as
well as in the direct and indirect beneficiaries that
extend its scope.
In 2024, efforts focused on further developing the
network of partners and strengthening the program's
structure, laying solid foundations so that Avión
Solidario can continue to reach more people every
day.
4,877
276
47
passengers carried
tons of cargo hauled
strategic alliances in Brazil,
Chile, Colombia, Ecuador
and Peru
› 159
08 / COMMITMENT TO SUSTAINABILITY
LATAM
GROUP
2024
› 160
GOVERNANCE
NCG: 519 3.1.II GOVERNANCE FRAMEWORK
LATAM group's Avión Solidario program is supported
by a governance structure that ensures the proper
management of agreements, transportation and
emergencies, as well as compliance with objectives
and continuous improvement. This governance
revolved around the coordination of different key
areas, with clearly defined roles and responsibilities:
1. Shared Value Committee
The Shared Value Committee's main responsibility is to
approve alliances and monitor results. This committee
establishes the program's strategic guidelines and
ensures that the initiatives implemented contribute
to the incorporation of shared value across the
organization.
2. Sustainability
The Sustainability area manages agreements related
to passenger and cargo transportation, coordinates
actions in emergency situations, and supervises the
impact and use of transportation in the beneficiary
communities. In addition, it focuses on maintaining
effective relationships with allies.
3. Project Management Office (PMO)
The PMO's main function is to monitor the program to
ensure that objectives are met. This interdisciplinary
team is responsible for aligning activities with LATAM
group's operational and strategic standards.
4. Other Teams Involved
The execution of the program is supported by various
operational areas of LATAM group, including:
⚫ Marketing
⚫ Internal and External Communication
⚫ Commercial and Cargo Teams
⚫ Operational Teams
⚫ Legal Team
⚫ Human Resources
13
3
17
The Avión Solidario program is the foundation of
LATAM group's shared value pillar, and contributes
directly to the fulfillment of three United Nations
Sustainable Development Goals (SDGs): SDG 3 (Good
Health and Well-Being), SDG 13 (Climate Action)
and SDG 17 (Partnerships for the Goals).
This interdepartmental collaboration ensures that
the Avión Solidario program operates efficiently,
maximizing its positive impact on the communities.
LATAM
GROUP
2024
08 / COMMITMENT TO SUSTAINABILITY
LATAM
GROUP
2024
› 161
08 / COMMITMENT TO SUSTAINABILITY
IMPACT OF AVIÓN SOLIDARIO IN 2024
HEALTH
Make Avión Solidario available as an air
bridge to support various health needs in the
communities (transport of patients, health
professionals and medical supplies).
ENVIRONMENT
Offering the transportation of flora and
fauna for their conservation, as well as the
transportation of scientists and members of
environmental foundations who travel to protect
the ecosystems in the region. In addition,
support is provided for the transfer of waste
from islands to the mainland in Latin America.
DISASTERS
It facilitates the transport of humanitarian
aid in response to floods, fires, earthquakes,
tsunamis, landslides and volcanic eruptions.
ORGANS AND TISSUES
Transportation of 1,265
organs, tissues, stem cells
and hemocomponents free
of charge in Brazil, Chile,
Colombia and Ecuador.
TICKET DONATIONS FOR
HEALTH NECESSITIES
More than 4,074 patients,
medical personnel and
healthcare teams were
transported free of charge
for treatment or surgery.
ANIMAL RESCUE
1,943 animals transported, free
of charge, in Brazil and Peru for
rehabilitation, conservation and
protection, including birds, turtles,
monkeys, primates native to the
Brazilian Amazon Rainforest, flamingos,
boas, otters and penguins.
In addition, professionals linked to
the execution of conservation projects
and work with the community were
also connected.
REMOVAL OF RECYCLABLE WASTE
238 tons of waste were removed and
transported from Easter Island /Rapa
Nui (Chile), San Andres (Colombia),
and the Galapagos Islands Archipelago
(Ecuador) for their proper management
and recycling.
The program collaborates with waste
management in strategic areas, due to
their environmental importance, as is
the case of these island destinations.
HUMANITARIAN AID
276 tons of various items for humanitarian aid were
transported. These included tents for refugees,
food, clothing, hygiene items and other donations.
Individuals who were survivors of natural disasters
and emergencies, as well as support personnel for
various causes, were also transported.
Of the total mentioned above, about 200 tons were
transported specifically to address the floods in the
state of Rio Grande do Sul (Brazil), which occurred
between April 28 and May 7, 2024, causing almost
200 deaths and affecting 2.4 million people.
LATAM
GROUP
2024
› 162
08 / COMMITMENT TO SUSTAINABILITY
UNIT
2022
2023
2024
ENVIRONMENTAL MANAGEMENT
GRI 302-1 AND 302-3
Energy consumption
—ground and air operations
TJ
134,436.71
157,010.48
178,678.22
Energy intensity
MWh/100 RTK
0,5
0.3
0.28
Water consumption
m3
85,656
271,571
261,600
Waste Generation
t
37,990
37,367
7,867 1
Units with Environmental Management System
(EMS)/Total Units
%
99%
100%
98.8%
Units with certified EMS/total units
%
99%
100%
98.8%
CLIMATE CHANGE MANAGEMENT
NCG 519: 9. SUSTAINABILITY, 9.1 SASB METRICS
GRI 305-1, 305-2 AND 305-3
TR-AL-110A.1.
Total emissions
tCO2e
12,985,755
14,624,405
16,556,047
Net emissions2
tCO2e
12,411,550
13,949,892
16,158,004
Scope 1 emissions3
tCO2e
9,780,288
11,524,420
13,118,183
Scope 2 Emissions
tCO2e
7,150
5,217
4,663
Market based
tCO2e
N/A
N/A
N/A
Location based
tCO2e
7,150
5,217
4,663
Scope 3 Emissions
tCO2e
3,198,317
3,094,768
3,433,201
CIRCULAR ECONOMY4
GRI 306-4 AND 306-5
Waste for elimination5
t
1,117
1,797
2,200
Waste diverted from landfill6
t
1,047
2,048
2,974
Total waste
t
2,164
3,845
5,174
SHARED VALUE – AVIÓN SOLIDARIO
GRI 203-1
Total tickets donated7
Number
3,554
4,563
4,877
Health
Organs, tissues, and stem cells transported
Number
964
1,847
1,265
Medical supplies
Number
4,577
6888
1,785
Disasters
Cargo transported as humanitarian aid
t
149
155
276
Environment
Animals rescued and transported
Number
246
122
1,943
Recyclable materials transported
t
170
256
238
UNIT
2022
2023
2024
N/A: Not applicable.
1 This year, hazardous waste generated by LATAM Peru in catering and onboard services are incorporated. The decrease is due to a change in the classification of
treated water at MRO Sao Carlos, which corresponds to non-hazardous liquid waste. This waste is later returned in a quality equal to or better than that of a surface
watercourse.
2 Net emissions are the total emissions minus the offsets made.
3 Scope 1 emissions: These refer to direct emissions generated by fuel consumption in air operations, the use of stationary sources, LATAM Group fleet vehicles, and
fugitive emissions from refrigerant gases.
4 Non-hazardous waste that can be sent to lanfill, per the existing regulations of each country, and for which LATAM has supporting documents of disposal or weight
records.
5 Sent to landfill or incineration without energy recovery
6 Handling: reduction and reutilization, recycling, composting, and incineration with energy recovery
7 The values reported are the sum of the three sub-pillars under the Avión Solidario pillar..
8 The decrease was due to a reduction in the number of requirements during the year.
Snapshot
GRI 2-4
LATAM
GROUP
2024
› 163
09 / SAFETY
09
_SAFETY
165 CUSTOMER SAFETY
171 OCCUPATIONAL SAFETY
177 CIVIL AVIATION AND PROPERTY SECURITY
GRI 3-3 AND 403-1
SASB TR-AL-540A.1
With regard to safety, LATAM group bases its actions
on the Safety, Quality, Health and Environment Policy,
which establishes the highest standards to safeguard
safety as a non-negotiable value. This document
is aligned with the parameters established by the
International Civil Aviation Organization (ICAO) and
promotes the development of the organization’s Safety
Management System designed for the identification,
prevention and mitigation of risks.
LATAM group’s safety culture is characterized by the
participation of its teams, continuous improvement
and the use of advanced technology to optimize
its indicators. In addition, LATAM group not only
complies with established procedures, but also
strives to exceed its standards by collaborating with
organizations and authorities to adopt best practices
and ensure safe operation.
CUSTOMER
SAFETY
OCCUPATIONAL
SAFETY
CIVIL AVIATION
AND PROPERTY
SECURITY
SAFETY, A
NON-NEGOTIABLE
VALUE.
› 164
LATAM
GROUP
2024
09 / SAFETY
09 / SAFETY
CUSTOMER SAFETY
NCG 519: 8.1 REGARDING ITS CUSTOMERS
GRI 403, 3-3
LATAM group is committed to ensuring that every
flight, whether of passengers or cargo, arrives at
its destination safely 100%, always prioritizing its
customers’ safety and trust. This commitment reflects
its constant focus on operational excellence and the
implementation of the highest safety standards in
the industry.
In 2024, sustained growth across its operations
marked a milestone for LATAM group, driven by the
opening and resumption of routes that significantly
expanded its destination coverage. This operational
expansion required extensive visits on site, change
management analysis to assess and manage the
impact of process modifications, and rigorous
validation of compliance with safety requirements
in each situation. To deal with these challenges,
LATAM group strengthened its data analysis capacity
and incorporated advanced technology into process
oversight, improving preventive and predictive
indicators associated with risk potential.
PASSENGERS WHO DIED AS A RESULT OF
AN EVENT DURING OPERATION 1
0
2021
0
2022
0
2023
0
2024
1 Number reported in line with the definition by the International Civil Aviation
Organization (ICAO).
› 165
LATAM
GROUP
2024
09 / SAFETY
› 166
INTEGRATED SAFETY MANAGEMENT
SYSTEM (SMS)
NCG 519: 9.SUSTAINABILITY- 9.1 SASB METRICS
SASB TR-AL-540A.1
LATAM Group’s Integrated Safety Management
System (SMS) is made up of four departments:
Operational Safety, Civil Aviation and Property
Safety, Occupational Safety and Emergency Response
Management (ERP). These are closely linked to the
operational and support areas to achieve LATAM
group’s purpose, ensuring acceptable levels of safety
in an efficient manner, balancing the continuity of
the operation with the well-being of both customers
and employees, so that all of them may arrive safely
at their destination.
In addition, the SMS includes the Emergency Response
Plan (ERP), in compliance with the requirements
and guidelines established in Annex 19 of the
International Civil Aviation Organization (ICAO) and
the regulations required in the different countries
where the subsidiaries are located.
Along these lines, the SMS brings together tools and
programs that enable LATAM group to act proactively,
monitor performance, identify risk situations, and
react promptly to mitigate them. In fact, the actions
are guided by the matrix of security risk factors
and criticality levels, updated periodically with data
from internal analyses and events related to global
aviation.
Also, as part of the commitment to continuous
improvement of the safety management system,
performance is constantly monitored through
In addition to the internal information that streamlines
the prioritization of potential risks, LATAM group
annually reviews the risks highlighted in the Air
Transport Association (IATA) Annual Safety Report
and publishes on its website a breakdown of the
mitigation measures for each risk. Likewise, it
discloses its participation in organizations chaired
by national and international authorities and
organizations related to commercial aviation, with
a focus on the safety of the sector.
indicators that reflect the degree of compliance
with safety targets. This process is carried out in
different safety spheres with the active participation
of management and more than 100 executives.
These spheres include the following:
AO AND SAF MANAGERS
TOP MANAGEMENT
CSO / Review of sms operation and effectiveness
DIRECTORS
SAFETY REVIEW BOARD / Strategic decision-making,
approval of significant changes, updates on risk
management and SPIs.
SAFETY ACTION GROUP / Management of high-risk factors,
approval of high-impact changes, collaborative decision-making,
definition of action plans, and others.
AO AND SAF FOCAL POINTS
INTERNAL MANAGEMENT OF OPERATIONAL AREAS /
Assessment, AGCs, PACs, etc.
LATAM
GROUP
2024
LATAM
GROUP
2024
› 167
09 / SAFETY
OPERATIONAL SAFETY RISK
MANAGEMENT
The Integrated Safety Management System (SMS)
Manual establishes the Operational Safety Risk
Management process. This process is based on three
key steps, namely:
DEFINITION OF SAFETY TARGETS
As part of the Safety Management System (SMS),
LATAM group implements the procedure for defining
safety targets, the purpose of which is to establish
the methodology for defining and monitoring safety
targets and goals, as well as SMS performance
indicators.
This procedure is applicable to the 10 air operators
and 8 maintenance organizations, and aims to define
objectives, indicators and goals, which are reviewed
annually.
OBJECTIVES, INDICATORS AND GOALS
ESTABLISHED FOR EACH OF THE SMS
COMPONENTS
Policy and Objectives
Risk Management
Safety Guarantee
Safety Promotion
01 02 03
Hazard identification and analysis
A thorough analysis of the hazards or
potentially hazardous conditions related to
flight operations and the processes of the
Maintenance Organization is performed,
involving different operational areas.
Risk Assessment
Each finding is evaluated based on
previous research and analysis.
Risk Mitigation
The root causes of the findings are
identified and mitigation action plans
are developed to be implemented by
the operational areas involved.
This model applies both to risks arising from
aircraft operation and to tasks performed by all
operational organizations, including airports,
maintenance and cargo.
LATAM
GROUP
2024
› 168
09 / SAFETY
AUDITS
As part of the integrated system, LATAM group
conducts a series of periodic audits that enable it to
improve its internal processes, as well as to identify
new opportunities in safety matters.
SMS 2024 OUTCOMES
NCG 519: 9.SUSTAINABILITY- 9.1 SASB METRICS
SASB TR-AL-540A.1.
⚫ 24,673 risks and hazardous situations1 were
identified by the SMS.
⚫ 88% of the safety risks and hazardous situations
identified through investigations or some type of
audit were mitigated. The percentage that has not
yet been mitigated has already been assigned a
management level and will be addressed in 2025,
in line with internal procedures. The percentage
that is still not mitigated corresponds to identified
and limited risk conditions which, according to the
matrix, are low risk. In other words, it is possible to
live with them while maintaining an acceptable level
of safety. It should be noted that they will also be
addressed as a priority during the first part of 2025,
in line with established internal procedures.
LATAM group has implemented the SMS in all
companies at level 4, which includes the four safety
components duly approved by all local authorities
where LATAM group has an affiliate and duly audited
by the authority and IOSA.
INTERNAL PREPARATION FOR IOSA AUDIT
In 2024, LATAM group implemented the “Unified Pre-
IOSA”, a systematic assessment of the company’s
critical processes and main safety risks, based on
the new IOSA Risk-Based methodology, which is
developed and promoted by the International Air
Transport Association (IATA). In addition to being
innovative, this model will be implemented through
a methodology that considers LATAM group as a
whole, leaving behind the three individual audits
previously performed separately on the 10 Air
Operator Certificates (AOCs).
This internal audit aims to improve LATAM group’s
visibility, increase quality and operational safety, and
adequately prepare for the official audit scheduled for
2025. Always focusing on our first guideline, “Safety”,
we hope that this new challenge will strengthen us
as a group and promote the continuous improvement
and effectiveness of our processes.
ANALYTICS AND ADVANCED DATA USAGE
Project Safety II
Since 2020, LATAM group has developed project
Safety II, designed to generate strategic flight
information and analyze several variables with the
potential to impact operational performance, such
as meteorological data, maintenance reports and
flight crew alert levels, among others.
In 2024, significant progress was made on this
project with the incorporation of a tool designed to
quickly identify flight phases, operations at specific
airports or fleet operations that offer opportunities
for improvement against established standards.
During the second half of the year, the focus was on
developing a risk model based on the variables with
the greatest impact on the operational performance
of a flight.
It should also be noted that, as part of the Safety II
project, LATAM group uses the Safety Performance
Index (SPI II), a key indicator that enables a detailed
visualization of a crew’s performance in all stages
of a flight. These advances have strengthened the
organization’s ability to generate correlations, identify
trends and perform validation analyses that detect
strengths and improvement opportunities, thus
consolidating a proactive approach to operational
safety.
LATAM group has partnered with carriers in the
exchange of information and best practices in the
initiative promoted by ICAO and managed by local
aeronautical authorities.
1 Risks and hazardous situations are broadly defined as any existing or
potential condition that could lead to an accident or incident.
CONTINUOUS IMPROVEMENT: TECHNICAL
ASSISTANCE
In 2024, as part of the continuous improvement of
its Integrated Safety Management System (SMS),
LATAM Group received the final Airbus Global Regional
Airbus Safety Program (GRASP) report. During this
assessment, both LATAM group’s Safety Management
System (SMS) and Quality Management System
(QMS) were reviewed to evaluate their effectiveness
in managing safety and quality throughout the
system. The process included a survey of executives,
participation in Safety Review Board (SRB) meetings,
a review of processes in Brazil, Chile, and the U.S.
cargo department, as well as interviews with leaders
across all departments.
Based on the recommendations presented in the final
report, LATAM group has begun to implement the
necessary action plans to improve its comprehensive
SMS. This implementation process will continue
through 2025, with the purpose of optimizing safety
and quality across all its operations.
Policy and Objectives
Risk Management
Safety Guarantee
Promotion
The SMS integrates tools and
programs that enable LATAM
group to act proactively, monitor
its performance, identify risks and
respond quickly to mitigate them.
09 / SAFETY
DATA MONITORING
Aircraft dispatch processes
Since 2022, LATAM group has carried out a thorough
diagnosis of passenger boarding processes, which has
enabled it to identify and map the risks associated
with aircraft dispatch.
Along these lines, in 2023, LATAM group implemented
the Safety Performance Index (SPI), an automated
monitoring system to collect accurate data on
potential safety events—information that was
previously unavailable. This enabled LATAM group to
show a significant improvement in airport dispatch
processes in 2024.
Flights
In 2024, LATAM group focused its efforts on optimizing
operational safety indicators through a continuous
improvement process. As a result, it reached record
levels in its main metrics.
Likewise, to strengthen its commitment to safety,
LATAM group implements the advanced Flight Data
Monitoring (FDM) program. This program compares
actual operating parameters with Standard Operating
Procedures (SOPs) through automated data collection,
processing and analysis. Thus, FDM not only detects
deviations, but also optimizes the management of
preventive maintenance processes and streamlines
operational analysis.
In addition, as a fundamental part of the Safety
Management System, FDM played a crucial role in
2024 by monitoring more than 95% of LATAM group’s
flights. This allowed the generation of strategic
data that helped to mitigate risks and prevent the
recurrence of incidents.
It should be noted that FDM provides segmented
information, managed under strict confidentiality
protocols. This data is integrated into Pilot LATAM,
a mobile app developed specifically for the group’s
pilots. Through this tool, pilots can access details
about their performance, compare their metrics with
fleet averages and analyze safety events detected
during flights, thus promoting continuous and
personalized improvement.
Reporting System
In 2024, LATAM group implemented a reporting
system available through mobile apps, streamlining
the reporting process for employees in charge of
generating safety-related reports. At the same time,
a web application was developed for LATAM group
service vendors, allowing them to report security
events. These initiatives strengthen the safety
management system by ensuring a more efficient
flow of information, accessible to all stakeholders.
LATAM group implemented the Safety
Performance Index (SPI)—an automated
monitoring system to collect accurate data
on possible safety events.
SAFETY
PERFORMANCE
INDEX (SPI)
› 169
LATAM
GROUP
2024
DISRUPTIVE PASSENGERS
GRI 403-7
As in 2023, disruptions in LATAM group during 2024
have been mostly related to passengers’ alcohol
consumption, making this factor the main trigger for
disruptive behavior. In response to this phenomenon,
courses and training for airport staff have been
updated and improved to identify passengers in an
altered state prior to boarding.
To address this situation efficiently, disruptive
passenger statistics are presented each month to
the boards of directors and senior decision-makers.
This makes it possible to review situations and take
relevant actions in a timely manner.
In addition, LATAM group has a Sexual Harassment
or Molestation Procedure, which is activated in the
event of this type of aggression towards its personnel,
ensuring that their physical and emotional well-
being is protected during these events and providing
professional support afterwards.
Likewise, a detailed analysis of the root cause and
contributing factors is carried out in each situation,
with the purpose of promoting continuous improvement
in any process that may have had even a minimal
influence on these behaviors within LATAM group.
This context has encouraged greater coordination
with local authorities, with the aim of ensuring a
regulatory framework that establishes consequences
for disruptive passengers and supports the airline,
in the event that it decides not to carry a passenger
deemed disruptive and/or dangerous.
Courses and training for airport staff
have been updated and improved to
identify passengers in an altered state
prior to boarding.
› 170
LATAM
GROUP
2024
09 / SAFETY
LATAM
GROUP
2024
09 / SAFETY
OCCUPATIONAL SAFETY
NCG 519: 5.6 OCCUPATIONAL SAFETY
GRI 403-1, 403-7 AND 403-9
Safety is a fundamental and non-negotiable value for
the companies in LATAM group. This commitment is
set forth in the implementation of an Occupational
Health and Safety management system designed
to prevent occupational injuries and illnesses for all
members of the operation.
Oversight of this system, which integrates various
occupational health and safety programs, falls to the
leaders of each operational area. They implement
the system’s guidelines with assistance from the
Corporate Security department.
Along these lines, LATAM group companies guarantee
regulatory compliance in all countries where they
operate and ensure full adherence to the Quality,
Health and Environment Policy.
In addition, LATAM group companies have established
a comprehensive occupational safety governance
strategy that encompasses several key procedures.
STAGES OF THE OCCUPATIONAL SAFETY MANAGEMENT SYSTEM
GRI 403-2
1 2 3 4
Hazard identification and risk
assessment
The companies in LATAM group
implement procedures for systematic
hazard detection and risk assessments.
In each case, control measures are
defined in the processes and facilities,
ensuring workers’ protection and
well-being.
Occupational safety
inspections 1
Periodic inspections are conducted at
LATAM group companies and include
detailed reports on identified risks
and potential impacts on operations
and individuals. In addition, action
plans are developed to mitigate
these risks.
Management and control of
action plans
Focused on prevention, this process
minimizes operational risks and
impacts through the implementation
of action plans that address root
causes identified during inspections.
To prioritize these plans, the
companies in LATAM group use
the Action Plan Index (API), which
evaluates, prioritizes and integrates
the different risk mitigation plans.
Change management
evaluation
The companies in LATAM group
identify and mitigate hazards
associated with internal and external
procedural changes proactively,
safeguarding the safety of new
ways of operating.
1 During 2024, over 9,370 inspections were carried out on the safety conditions of the critical risks identified by LATAM group through a comprehensive work plan.
› 171
› 172
09 / SAFETY
LATAM
GROUP
2024
OCCUPATIONAL MANAGEMENT SYSTEM
GRI 403-2
The companies in LATAM group continuously evaluate
the effectiveness of its management system by
monitoring key indicators, such as accident and
injury rates, and the Potential Serious Incident (PSI)
indicator.
In this regard, LATAM group has managed to maintain
a downward trend in the injury rate (accidents with
lost days) and in the absence of fatal events.
In addition, LATAM group has also made progress
in monitoring the Potential Serious Incident (PSI)
indicator for each country and operating area, which
has resulted in a decrease in the number of events
at risk of becoming serious incidents and a lower
number of injured employees. This underscores the
importance for LATAM group to consolidate this
concept, bringing it to the spotlight and establishing
action-focused preventive management through
constant observation and operational leadership.
In turn, in 2024, LATAM group implemented the
Severe Incident Prevention Program (prePAG, for
its Spanish acronym) in Brazil, a methodology that
makes it possible to identify, assess and mitigate
high-risk conditions, becoming a proactive tool
for managing potentially serious events, with the
intention of expanding its application across the
whole company in 2025.
Likewise, LATAM group strengthened its management
capacity by digitizing Behavioral Safety Inspections
(IPS, for its Spanish acronym), which improved the
agility and timely analysis of data.
In 2024, it also evidenced the effectiveness of
the Investigations area in strengthening security,
identifying undesirable events that have a commercial
and operational impact on the LATAM group. In
fact, improvements were made in cargo tracking
processes in warehouses and in prevention initiatives in
Maintenance areas. In addition, access and exit control
was strengthened at LATAM group’s Maintenance
Base, addressing internal threat situations.
This monitoring also includes third-party service
providers, who must comply with their local
regulations and, in some cases, actively participate
in the monitoring of these safety indicators.
It is important to point out that the availability of this
information enables the prioritization and integration
of action plans through the Action Plan Index (API),
which evaluates risks according to their probability
and severity, making it possible to implement the
most effective plans for each situation.
OCCUPATIONAL SAFETY MANAGEMENT
SYSTEM (OSMS) MANUAL
GRI 403-1
In 2024, LATAM group published the first edition of the Occupational Safety Management System
(OSMS) Manual, based on international standard ISO 45001. The purpose of this manual is to
formalize, structure and standardize the area’s processes, consolidating an effective framework
for managing the occupational health and safety of LATAM group’s employees. Thus, performance
and commitment can be measured at all levels of the organization, comprehensively addressing
the risks associated with operations and promoting continuous improvement in safety standards.
It is important to note that the OSMS encompasses all employees involved in LATAM group’s
operational processes, ensuring that all those involved in the operational chain are covered and
protected under the same safety framework.
LATAM group has succeeded in keeping
injury rates (accidents with lost days)
on a downward trend, while fatal
events have been nil.
DEKRA FOR CHILE
In 2024, German consulting firm DEKRA, in partnership
with the Chilean Safety Association (ACHS, for its
Spanish acronym), developed a project that allowed
LATAM group to expand the program for risk exposure
identification at important Chilean regional bases
(cargo operations). Focusing on organizational culture,
leadership and behavior, the project has made it
possible to initiate a diagnosis in the Airport area
in Santiago, with the aim of defining the tools that
LATAM group will implement in 2025.
APPSHEET ID LATAM
As part of the continuous improvement strategy,
in 2024 we completed the implementation of the
Appsheet ID LATAM initiative, a control tool designed
to streamline and expedite the application for
corporate badges for new employees. This solution
optimizes the onboarding process, offering a safer,
simpler, more efficient and empathetic experience,
which facilitates the integration of new LATAM group
members in a more agile and hassle-free manner.
This initiative, driven by the Corporate Security team,
also strengthens the control of facilities, protecting
employees and assets by identifying who enters
restricted areas or more sensitive spaces from day
one.
09 / SAFETY
STRENGTHENING THE SAFETY CULTURE
GRI 403-4, 403-5 AND GRI 403-7
Consultation and Participation Mechanisms
LATAM Group uses various mechanisms to ensure
that employees can actively participate and be
consulted on issues related to the Occupational Safety
Management System. These mechanisms include:
Health and Safety Committees: LATAM group has
established Health and Safety Committees in all
its facilities and operating areas. These committees
include representatives of both management and
employees, and meet regularly to discuss occupational
health and safety issues, review incidents, and
propose improvements.
AQD Report: LATAM group uses the AQD digital
platform, which allows employees to send their
comments and participate in the detection of hazards
and risks related to occupational health and safety.
Microlearning Project
In 2024, LATAM group successfully implemented a
series of courses within the Microlearning Project, which
complemented the activation process of pilots responsible
for acting as “gatekeepers” of relevant information
generated during flights. These courses, designed to
strengthen key skills in operational situations, are
based on a Problem-Based Learning (PBL) methodology
and have contributed significantly to increasing pilots’
situational awareness (i.e., perception, understanding
and projection of actions under specific conditions), thus
improving safety and operating efficiency.
Up to 2024, 10 courses have been launched addressing
topics such as aircraft energy management, monitoring
skills, workload management and other key aspects of
flight operations.
Human Factors Program
In 2024, LATAM group continued the implementation of
the new corporate-wide Human Factors Manual, which
serves as a guide for initial and recurring Crew Resource
Management (CRM) courses. In addition, new indicators
were designed to manage the risk of fatigue and self-
care communications were implemented to promote
employee health and safety in the work environment.
SeguraMente Program
In 2024, LATAM group strengthened the SeguraMente
(a play on words, meaning “safe mind”) program, which
provides medical consultations and psychological support
to pilots. This program also includes Pilot Peer Support,
a pilot-to-pilot support initiative focused on creating
an environment of trust and emotional support, which
was reinforced during the year. As part of this, new
members joined the team in Brazil to expand the scope
of support, thus ensuring the well-being and mental
health of the crew.
Alcohol and drug screening
LATAM group has an Alcohol and Drug Policy and Program,
which is based on the screening methodology used by
the United States Federal Aviation Administration (FAA),
to ensure a safe and healthy work environment. This
program includes activities designed to prevent drug
and alcohol abuse, as well as preventive toxicological
screenings designed to discourage the use of these
substances.
In addition, during 2024, LATAM group increased
alcohol and drug screening, updated procedures, and
continued to work on the dissemination of prevention
communications.
› 173
LATAM group uses various
mechanisms to ensure
that its employees can
participate actively.
LATAM
GROUP
2024
Ground Damage Campaign
During 2024, LATAM group developed a comprehensive
methodology to raise “situational awareness” (i.e., the
perception, understanding and projection of actions
under specific conditions) among its own and third-
party personnel. This methodology combines training,
performance indicators and management tools, including
video shorts that highlight key processes, such as the
Ground Power Unit (GPU), conveyors and stairways.
Thanks to the positive impact of this initiative, LATAM
group will continue to expand it during 2025, with the
development of new shorts focused on Maintenance
and Cargo, in addition to reinforcing safety indicators
at airports and cargo operations to ensure sustainable
improvements.
Security Survey: I-ASC
GRI 403-2
En 2024, el grupo LATAM evaluó su cultura de seguridad a
través de la encuesta I-ASC de la Asociación Internacional
de Transporte Aéreo (IATA). Esta encuesta mide la cultura
de seguridad en diversas dimensiones, como la conciencia
de seguridad, el compromiso de la alta dirección, el
empoderamiento de los empleados y el aprendizaje
organizacional. Los resultados mostraron una cultura
de seguridad sólida, con un aumento significativo en
la participación y un progreso que posicionó al grupo
LATAM en el primer cuartil de las empresas encuestadas.
Como parte de la mejora continua de su Sistema
Integrado de Gestión de Seguridad (SMS), el grupo
LATAM trabajará durante 2025 en la implementación
de planes de acción derivados de las oportunidades de
mejora identificadas en la encuesta.
Los Intransables Campaign
In 2024, the LATAM group launched “Los Intransables”
(the Non-Negotiables), an awareness campaign that
defines five key behaviors to promote a culture of safety
throughout its operations. These behaviors, which govern
the daily attitudes and decisions of each employee, are:
⚫ To comply with standards and procedures.
⚫ To perform tasks for which one is qualified.
⚫ To report hazardous situations.
⚫ To ensure safety at all times.
⚫ To foster an environment of safe collaboration.
Third Party Security Report
At the end of 2024, LATAM group launched the Safety
Report web application so that employees of third-party
companies operating in its facilities and operations can
report any security event. This tool reinforces LATAM
group’s commitment to safety and promotes the integration
of third-party companies into a common safety and
reporting culture, enabling the early identification and
mitigation of operational risks.
Safety Week
As every year, LATAM group held Safety Week from
November 4 to 9, 2024. During that week, time was
devoted to activities related to Operational Safety,
Occupational Safety, Civil Aviation and Property Safety,
and Cybersecurity, including webinars, operational talks
with executives from different areas, presentations
by industry experts, and recognition of outstanding
employees for their commitment to safety.
› 174
09 / SAFETY
LATAM
GROUP
2024
INSPECTIONS
LATAM group performs safety inspections based on
a work plan that covers various airport processes,
considering infrastructure, mobile equipment,
stairways, work-at-height systems and any other
activity or condition that poses a critical risk. The
purpose of these inspections is to mitigate risks and
protect both individuals and operations, ensuring the
well-being of passengers and employees, in line with
aviation regulations. These inspections have adapted
to meet the new challenges posed by changes in
regional dynamics and external conditions.
KNOW
CORRECT
LEARN
UNDERSTAND
Information gathering.
Use the root cause analysis
methodology.
Assess the scope of the problem and
the extent of prevention measures.
Determine the context of the event.
Inquiry into occupational incidents
The occupational safety area has a corporate procedure
in place to regulate inquiries into incidents. This
procedure clearly defines the steps to be followed
during the inquiry, namely:
At LATAM group, the entire process is documented
by means of an inquiry form, which establishes the
causes of the incident and the corrective actions to
be implemented.
› 175
LATAM
GROUP
2024
09 / SAFETY
› 176
LATAM
GROUP
2024
09 / SAFETY
OCCUPATIONAL SAFETY1
NGC 519: 5.6 OCCUPATIONAL SAFETY
2021
2022
2023
2024
TARGET
2024
Accident rate (per 100 workers)2
GRI 403-9
0.48
0.64
0.61
0.52
0.673
Fatality rate4-5
0
0
0
0
N/A
Occupational disease rate
(per 100 workers)6
0.04
0.03
0.03
0.07
N/A
Average number of days lost due to accidents7
GRI 403-9
10.24
11.48
11.62
11.18
N/A
Accident rate per occupational injury with major
consequences8,9-10
GRI 403-9
0.00
0.00
0.00
0.00
N/A
Absenteeism rate
CSA - ABSENTEEISM RATE
4.7
4.1
4.4
4.6
N/A
N/A: Not applicable
1 Some indicators in this section began to be counted in this way in 2022, so there is no information from previous years.
2 Total work accidents/Average workforce x 100.
3 The targets are set based on the number of operations carried out by the LATAM group.
4 Excluding those related to accidents in transit and those suffered by leaders of trade union institutions because of, or in the performance of their trade union duties.
5 The calculation of the rate follows the formula: Total fatalities per work accident/Average workforce x 100,000.
6 Total occupational diseases/Average workforce x 100.
7 Total days lost due to work accident/Total work accidents.
NB: The count of lost days begins on the day after the accident.
8 Accidents related to some critical risk and high-impact events (accidents resulting in over 100 days lost) represent 1.5 in the calculation.
9 Rate calculation formula: total injuries with work interruptions/average no. of employees x 100.
10 Accidents resulting in such damage that the worker cannot recover, does not recover, or is not expected to fully recover their state of health from before the accident, within six months.
In 2024
0 FATALITIES
0.52 ACCIDENTS
per 100 workers
0 OCCUPATIONAL
injuries with major consequences
09 / SAFETY
› 177
CIVIL AVIATION AND
PROPERTY SECURITY
LATAM group is aligned with the most demanding
national and international standards in terms of civil
aviation and property safety, constantly investing
in the continuous improvement of its processes.
CIVIL AVIATION AND PROPERTY SECURITY
MANAGEMENT SYSTEM (SEMS)
The Civil Aviation and Property Security Management
System (SeMS) is designed to strengthen the structure
of its security pillars, both at the airport level and
in its facilities. In addition, it covers all LATAM
group operations and includes measures to protect
passengers and employees, ensuring operational
continuity and mitigating threats and risks, always
observing the highest levels of security.
Along these lines, during 2024, the SeMS has
matured significantly, strengthening each of its pillars
through continuous improvement and performance
monitoring. These developments are aimed at
establishing clear guidelines, ensuring compliance
with civil aviation procedures and meeting regulatory
requirements, working closely with authorities and
other stakeholders.
Thus, the approach is carried out throughout its
passenger and cargo operations, using a series of
processes, such as reporting, communication, effective
daily operation, contingency plans, permanent
oversight and operational excellence. The aim of all
this is to provide an adequate and timely response
to threats or acts of unlawful interference against
LATAM group’s operations, facilities and infrastructure,
maintaining risk levels within an acceptable range.
In addition, LATAM Group’s SeMS includes procedures
designed to investigate undesirable situations and
identify the underlying causes of events, as well
as establish corrective measures to prevent the
occurrence of new incidents.
EMERGENCY RESPONSE PLAN
LATAM Group has an Emergency Response Plan
(ERP) that defines the resources and individuals to
be activated in the event of an incident or aviation
accident involving damage to property or people. The
main goal of providing this plan is to support the
affected individuals and their families, collaborate
with the aeronautical authorities in the investigations
and maintain constant communication with the
different stakeholders to ensure the continuity of the
operation. This plan also establishes organizational
guidelines for dealing with other types of emergencies
that could seriously affect operations, such as natural
disasters, pandemics, strikes or severe contingencies.
In this context, there are Emergency Response
Committees (ERC) in each of LATAM group’s affiliates:
Brazil, Chile, Colombia, Ecuador, Paraguay, and Peru.
In addition, there are three other ERCs in Buenos
Aires, Madrid and Miami, where LATAM group has
personnel and structures. These committees meet
regularly in round tables with experts from different
areas to prepare for and manage emergencies and
mitigate their effects through procedures, teams and
volunteers, to provide support to affected individuals
and their families.
In addition, emergency drills and training are
conducted every year in all ERCs to put processes
into practice and ensure familiarity with the roles
and responsibilities of each area.
In 2024, a total of six Emergency Response exercises
were conducted, in which one or more ERCs were
activated simultaneously. One of these exercises
included a cybersecurity-related activation.
In 2024, a total of six Emergency Response exercises were
conducted, in which one or more ERCs were activated
simultaneously. One of these exercises included a
cybersecurity-related activation.
By 2025, the focus will be on improving coordination
between third-party organizations that are activated
alongside, such as airport managers, embassies,
consulates and civil aviation authorities.
In 2024, a total of six Emergency Response exercises
were conducted, in which one or more ERCs were
activated simultaneously. One of these exercises
included a cybersecurity-related activation.
LATAM
GROUP
2024
LATAM
GROUP
2024
09 / SAFETY
These agreements seek to standardize
the level of service provided and lead
to a joint commitment to ensure that
each process is performed with top
quality, strictness, and customer care.
SERVICE CONTRACTS
During 2024, LATAM group tendered security services
contracts in several countries simultaneously, with the
aim of grouping suppliers by geography, streamlining
performance management and establishing new
contractual agreements. These agreements seek
to standardize the level of service provided and
generate a joint commitment to ensure that each
process is carried out with the highest quality, rigor
and customer care, assimilating LATAM group’s safety
culture into third-party operations.
Among the projects carried out, the digitization
of support processes and the implementation of
more user-friendly and effective security interview
methodologies for passengers bound for the United
States (AIM/BDP) are worth noting. This process,
based on behavioral observation and prior analysis,
allows for a more effective and less invasive approach.
In fact, by the end of 2024, all employees located at
the Last Points of Departure (LPDs)—key departure
points where security checks are conducted prior
to boarding—were trained and the rollout was
successfully completed in December. This initiative,
validated by the U.S. Transportation Security Agency
(TSA), seeks to balance regulatory compliance with
a safe and seamless travel experience.
In addition, new technologies were adopted to monitor
each transfer point in the cargo business operations,
preventing losses and illegal interference through
traceability checkpoints and security camera analysis.
This approach has strengthened investigative and
predictive capabilities to mitigate internal threats.
In addition, progress was made in unifying LATAM
group’s global access control methods in several
countries. This included centralizing the administration
of the physical access control system, adding affiliates
and regional offices.
A new policy was also established to define the
technical standards required for Security Control
Centers (SCCs), enabling them to fulfill their
expanded role with greater proactive and preventive
capabilities. In this context, the role of SSCs was
strengthened through the creation of a corporate
protocol with technical guidelines that expand their
scope, incorporating issues related to occupational
risk prevention, supported by data analytics and
digitization.
EFFECTS OF MIGRATION
The aviation industry faces significant global challenges
due to increasing migration processes. Therefore, as
of 2023, LATAM group has implemented additional
passenger documentation and background checks
on routes considered sensitive from a migratory
point of view.
Global geopolitical and socioeconomic instability
has led to an increase in mass migration in recent
years, creating difficulties at some airport transit
facilities. As a result, the presence of inadmissible
passengers—who, in certain cases, can become
disruptive—represents a concern for both customer
safety and civil aviation and property.
Faced with this scenario, LATAM group has strengthened
its security approach through new risk analyses, the
implementation of stricter civil aviation and property
measures, and greater coordination with the Airport
areas and local authorities.
› 178
09 / SAFETY
SECURITY INCIDENTS
NCG 519: 9.SUSTAINABILITY- 9.1 SASB METRICS
SASB TR-AL-540A.2
On March 11, 2024, during flight LA 800 on the Sydney
(Australia) - Auckland (New Zealand) route, operated
by a Boeing 787, an abrupt maneuver occurred during
the cruise stage, resulting in autopilot disengagement
and a momentary descent of the aircraft. The
crew handled the situation professionally, and the
aircraft landed safely in Auckland, where immediate
assistance was provided to those affected.
LATAM group activated its Emergency Response Plan,
providing all necessary support to passengers and
employees. In addition, care and follow-up protocols
were implemented to ensure the well-being of those
involved.
At the close of 2024, this event continues to be analyzed
by the General Directorate of Civil Aeronautics (DGAC,
for its Spanish acronym), which has classified it as
an Aviation Accident1. In this context, LATAM group
continues to work closely with the authorities in the
investigation of the event and to take corrective
measures to reinforce operational safety, reiterating
its commitment to the safety of its passengers and
crew, in line with the highest standards across all
its operations.
1 An aviation accident is defined in accordance with Annex 13 of the International
Civil Aviation Organization (ICAO), which establishes international standards for
the investigation of aviation accidents and incidents. In Chile, this classification is
determined by the General Directorate of Civil Aviation (DGAC), the authority in
charge of investigating these events, which in this case categorized this event as
an accident because a passenger required hospitalization for more than 48 hours.
It is worth mentioning that the passenger recovered after the care received.
LATAM
GROUP
2024
› 179
09 / SAFETY
› 180
Snapshot
NCG 519: 9.SUSTAINABILITY- 9.1 SASB METRICS
2021
2022
2023
2024
Aviation accidents1
SASB TR-AL-540A.2
0
1
0
0
Government measures for the implementation of aviation
safety regulations2
SASB TR-AL-540A.3
N/A
0
1
0
Members of the emergency team
2.240
N/A
573
1,156
People trained in procedures
3.400
3,500
3,549
16,027
Harmonized accident rate per million sectors
0
0
0
0
N/A: Not Available.
1 In 2022, runway incident occurred due to collision with a fire truck.
2As a result of the COVID-19 pandemic in 2020, there was a reduction in personnel that affected the
number of volunteers in the emergency team. However, this figure has progressively reversed, as can be
seen in 2024.
3 The indicator began to be collected in this way in 2022, so there is information available for previous
years.
LATAM
GROUP
2024
LATAM
GROUP
2024
› 181
08 / SUPPLIERS
10
_SUPPLIERS
182 SUPPLY CHAIN MANAGEMENT
186 SUPPLIER SELECTION AND EVALUATION
194 GUIDELINES
195 PAYMENT POLICIES
08 / SUPPLIERS
SUPPLY CHAIN
MANAGEMENT
NCG 519: 6.2 BUSINESSES
GRI 2-6 Y 3-3
The Procurement department, which is part of the
Vice-Presidency of Finance, is responsible for ensuring
that LATAM group's negotiations and purchases are
carried out in a timely and efficient manner, adopting
a strategic vision to optimize the return on each
resource invested. In addition, it seeks to strengthen
the collaboration and relationship with its suppliers,
ensuring the business’ operational continuity and
promoting growth for both parties.
To fulfill this mission, the Procurement department
is organized in specialized teams, namely:
Technical Negotiations
Technical Negotiations are understood as those directly
associated with LATAM group's operations. These are
handled by the Procurement department. However,
technical purchase orders are managed together with
the Operations and Maintenance Vice-Presidency
and by the Fleet and Projects department.
Negotiations and Non-Technical Purchases
Non-Technical Negotiations are understood as those
indirectly associated with LATAM group's operations.
Fuel & Fees Negotiations
Negotiations Team in charge of the relations, purchase
and management of fuel, in addition to flyover,
Landing and ILS (radio assistance) fees, to ensure
LATAM group's operations.
It should be noted that the Procurement department
is headed by the Procurement Manager, who reports
directly to the CFO and has teams in Chile and Brazil,
in addition to representatives in each of LATAM
group’s affiliates. The goals of the Procurement
department are established annually in line with
LATAM group’s strategic guidelines and monitored
by the Planning and Support team, together with
the Management Control teams.
In 2024, monthly meetings were held with the
members of the Executive Committee (COMEX,
for its Spanish acronym) to analyze the status of
the procurement and negotiation processes in each
area. These meetings provided an opportunity to
address concerns for both Procurement and COMEX,
to review the Service Level Agreements (SLAs) of
the processes, and to ensure that the management
of the team maintains its strategic alignment and
operating efficiency.
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LATAM
GROUP
2024
08 / SUPPLIERS
COMMUNICATION CHANNELS WITH
SUPPLIERS
LATAM group uses various communication channels
with its suppliers based on their category and the
selection stage, always prioritizing a relationship
based on excellence and collaboration with each
supplier.
Particularly with critical and strategic suppliers,
annual face-to-face meetings are held between
senior executives of both parties to strengthen the
relationship between LATAM group and its suppliers.
In this space, they address current issues and
expectations regarding the business relationship, in
addition to sharing best practices, fostering innovation
and development, and exploring sustainable initiatives,
among other aspects.
In addition, LATAM Airlines Group S.A. constantly
updates its Investor Relations web page, where
relevant information is published for both suppliers
and the public in general.
CHANNELS
Meetings and gatherings,
Telephone calls and E-mail
SAP Ariba Platform
(Bidding process and,
in some cases, also
afterwards)
DIRECT
INDIRECT
PROCUREMENT 3.0: TECHNOLOGY,
DIGITIZATION AND SUSTAINABILITY
Since 2023, LATAM group's supplier management
strategy has been marked by the adoption of new
technologies to optimize procurement processes,
improve decision-making, and increase transparency
and sustainability throughout the supply chain.
By implementing artificial intelligence, LATAM group
seeks to improve agility, accuracy and efficiency,
proactively anticipating market needs. Within this
framework, the Procurement 3.0 strategy strengthens
process optimization and supplier relations, promoting
sustainable practices and fostering mutually beneficial
relationships.
During 2024, Procurement teams received intensive
training in technology and automation to strengthen
these competencies and enable new opportunities for
innovation, technology adoption and risk mitigation.
STRATEGIC PROCUREMENT RELATIONS
DRIVING THE PASSENGER EXPERIENCE
LATAM Group's Procurement department plays a key role
in managing strategic alliances that generate value for
passengers. Thus, in 2024, further progress was made in
partnerships that have enhanced the travel experience:
⚫ Premium Mobility with Audi
Together with LATAM Group's Commercial Management
in Brazil, an agreement was reached with Audi to offer an
exclusive transportation service to Black and Black Signature
customers at the Congonhas Airport. This service includes
five Audi E-tron vehicles, which are part of a brand visibility
campaign. The campaign encompasses events, in-flight
entertainment system videos, marketing emails and in-flight
ads, with the aim of strengthening Audi's presence among
passengers.
⚫ Partnership with Petrobras' Premmia
LATAM Group and Petrobras agreed to integrate the LATAM
Pass and Premmia loyalty programs, allowing customers to
redeem miles for benefits at more than 7,000 Vibra service
stations. This initiative strengthens passenger loyalty and
expands the airline's rewards ecosystem.
⚫ Gastronomic Innovation with NotCo
LATAM Group and NotCo have joined forces to offer an
innovative culinary experience in Premium Economy. Along
these lines, since April 2024, domestic flights lasting more
than two hours on Airbus A320 aircraft include plant-
based options designed to cater to a wider audience. This
collaboration reinforces LATAM group's commitment to
sustainability and food diversity.
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2024
› 183
LATAM
GROUP
2024
› 184
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CLASSIFICATIONS
NCG 519: 6.2.III BUSINESSES
GRI 2-6 & 2-8
Suppliers are essential allies for LATAM group's
success, as they ensure the continuity and quality of
daily operations. From the procurement of aircraft
and engines to the supply of fuel and maintenance
services, and of catering and management technology,
each supplier plays a key role in the value chain.
Close collaboration with them allows LATAM group
to maintain high standards of safety, operational
efficiency and customer satisfaction, ensuring a
superior travel experience.
307
THIRD PARTY INTERMEDIARIES (TPIS)
164
SUBCONTRACTORS
That signed a contract or annexes during 2024.
5,774
SUPPLIERS
IN 2024
145
CRITICAL
5,629
NON-CRITICAL
308
STRATEGIC
5,466
NON-STRATEGIC
TOTALING
US$10,215 MILLION
ACQUISITIONS
IN 2024, 25 SUPPLIERS INDIVIDUALLY REPRESENTED
10% OR MORE OF THEIR CATEGORY.
Some LATAM group
suppliers
AIRCRAFT MANUFACTURERS
Airbus
Boeing
ENGINES
MTU Maintenance
Pratt and Whitney Canada
CFM International
General Electric Commercial Aviation Services Ltd.
General Electric Celma
General Electric Engines Service
Rolls Royce
Honeywell
FUEL
Vibra
WFS
Copec
Terpel
Repsol
AirBP
LATAM group defines different classifications for its supplier
universe, which are not mutually exclusive.
Classification of suppliers by type of channel
⚫ Third Party Intermediaries (TPIs)
Suppliers that interact on behalf of LATAM Group with government agencies
and public officials, both nationally and internationally.
⚫ Subcontractors
Suppliers whose personnel perform tasks within the facilities where LATAM
Group operates.
Supplier classification by criticality for the operation
⚫ Critical:
Suppliers are considered critical when the absence of their services would
have an impact on the operation.
⚫ C-Critical
On the other hand, there are Critical but Non-Strategic suppliers called
C-Critical suppliers. These are suppliers that represent an annual expenditure
of under US$2 million and are defined as critical, as they can affect the
operation if their supply chain is interrupted.
⚫ Non-Critical:
Suppliers are considered non-critical when the absence of their services
would not have a significant impact on the operation.
Supplier classification based on annual expenditure
⚫ Strategic
Suppliers that represent an annual expenditure of more than US$2 million
or are part of the most representative 85% of annual expenditure (Suppliers
A and B).
A Suppliers: Annual expenditure representing 50% of spending or
greater than US$10 million.
B Suppliers: Annual expenditure representing between 50% and 85% of
spending or greater than US$2 million.
⚫ Non-Strategic
Suppliers that represent an annual expenditure of less than US$2 million
or that are part of the remaining 15% of annual expenditure (Suppliers C).
LATAM
GROUP
2024
08 / SUPPLIERS
5.2%
536
Ground handling (support services for aircrafts,
passengers, and cargo)
9.6%
978
Infrastructure
Distribution by country1 in 2024
(BY NUMBER OF SUPPLIERS)
GRI 2-6
Distribution by category1 in 2024
(BY VALUE OF ACQUISITIONS - US$ BN.)
GRI 2-6
20.1%
1,158
Others
15.4%
889
Chile
6.9%
396
Colombia
39.4%
4,025
Fuel
21.7%
2,214
Fleet, engines and
technical purchases
2.6%
268
Provisioning and
catering
2.3%
240
Hotels and transportation
3.1%
322
Technology and
systems
15.3%
1,563
Other non-technical
purchases
0.5%
56
Management
1 To present the information, the countries and categories that were most representative of annual spending were considered. In addition,
there were no significant changes in the composition of spending compared to the previous reporting period.
0.1%
14
Uniforms
8.7%
504
Peru
13.2%
764
United States
4.0%
232
Ecuador
31.7%
1,831
Brazil
› 185
SUPPLIER SELECTION
AND EVALUATION
NCG N°519: 7.2 SUPPLIER EVALUATION
INTERNAL NEED
In line with the procurement needs arising
from the various areas, LATAM group
obtains quotations and holds tenders
that the Procurement department
centralizes and leads.
Thus, for the creation of any supplier,
LATAM group performs due diligence
processes through a specialized system
and, if risks are detected, a special
review by the Compliance department
is coordinated.
SELECTION
This process is carried out with special
care to aspects of transparency and
impartiality, in line with the Procurement
Policy, the Code of Conduct and the
regulations of each country.
Criteria considered:
⚫ Financial, technical and economic.
⚫ Conflicts of interest and other aspects
of Compliance.
⚫ Other environmental recommendations
(e.g., certifications).
01
02
03
04
EVALUATION
After signing the contract, periodic
monitoring is carried out to ensure the
expected standard.
In turn, all suppliers are evaluated every
six months under the same criteria
analyzed at the time of their creation.
In addition, there are further reviews
with specific targets depending on the
category of the supplier.
ONGOING IMPROVEMENT
Document audits are carried out for
certain suppliers and for suppliers that
have outsourced services operating on
site at Chilean airports. This is to assess
their compliance with legal, social and
human rights regulations.
If gaps are found in the evaluation and/
or audits, improvement plans can be
established and are monitored to ensure
compliance.
It is worth highlighting in this area the
case of Brazil, where there is a third-
party management program with external
specialized consulting, which has been
strengthened recently (see more in
"Third-Party Management: Brazil").
› 186
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2024
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SELECTION
The selection of each supplier is an opportunity
to establish solid and collaborative relationships,
aligned to policies and objectives. For this purpose,
LATAM group has a specialized team that performs
a comprehensive analysis of each candidate with
the aid of technological systems, mainly considering
their technical and economic aptitudes.
LATAM group does not limit the selection of suppliers
by origin, sector or commodity, but considers specific
risks linked to these factors. For example, the
Compliance team, together with the Procurement
department, uses a platform that identifies risks,
analyzes conflicts of interest and issues alerts to
minimize exposure. This system leverages updated
data from different sources and countries to build
profiles and improve risk identification.
In addition, LATAM group takes specific measures
to mitigate risks associated with raw materials. For
example, in the case of fuel, it evaluates suppliers
against international standards for health, occupational
safety, and climate impact and hazardous waste
management.
On the other hand, the Cybersecurity team analyzes
suppliers with access to technological infrastructure
through intelligent questionnaires that require
mandatory evidence, classifying risks and defining
technical reviews and reports. High-risk cases
are escalated to a committee organized by the
Cybersecurity team where they invite the areas
involved to analyzed the cases and reach decisions.
New suppliers1 in 2024
NCG N°519 7.2.I SUPPLIER EVALUATION
GRI 414-1
NATIONAL
FOREIGN
Number of new suppliers
213
24
Number of suppliers that were evaluated but were not
selected
1
0
Number of new suppliers that were evaluated under
social criteria and subsequently selected
213
24
Percentage of new employees evaluated under social
criteria as a selection filter
100%
100%
1 New suppliers are those originally created in a LATAM group affiliate (Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Spain, United
States, Panama, Peru and Uruguay).
Supplier Selection
INDICATORS SUGGESTED BY S&P GLOBAL CSA
2024
Total number of tier 11 primary suppliers
5.774
Percentage of total spending on tier 11 primary suppliers
100%
Total number of non-tier 12 primary suppliers
0
1 Tier 1: Strategic suppliers that directly supply one of LATAM group’s companies.
2 Non-tier 1: Suppliers that are in turn contracted by other suppliers to render their services to one of LATAM group’s companies.
Note: Suppliers are considered significant when they represent a high percentage of LATAM group's expenditure (strategic), absence of
their services would cause an impact on the operation (critical), or they have compliance risks (corruption, bribery, money laundering
or other crimes), technological risks (cybersecurity), environmental risks (environmental crimes) or social risks (child labor, forced labor,
financing of terrorism or similar items).
› 187
LATAM
GROUP
2024
› 188
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LATAM
GROUP
2024
EVALUATION
NCG N°519: 7.2 SUPPLIER EVALUATION
To ensure that suppliers comply with the standards established in LATAM
group’s guidelines, each supplier must undergo various types of evaluations.
These reviews focus mainly on quality and financial aspects, but also include
labor, safety and, as of 2024, sustainability criteria associated with the circular
economy. The frequency and depth of evaluations vary according to the type
of supplier and the nature of the business relationship.
Supplier evaluation in 2024
NCG N°519 - 7.2.I AND 7.2.II SUPPLIER EVALUATION
NATIONAL1
FOREIGN
TOTAL
Number of evaluated
suppliers
4,616
1,158
5,774
Number of suppliers that
were evaluated under
sustainability criteria2
4,616
1,158
5,774
Percentage of suppliers
evaluated out of total
number of suppliers
79.9%
20.1%
100%
1 National suppliers are those that have a tax ID (RUT, for its Spanish acronym) in the same country as the contracting
LATAM group affiliate (Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Spain, United States, Panama, Peru and
Uruguay), considering both new and old suppliers, as well as suppliers that were evaluated even if they were not selected.
2100% of suppliers were evaluated under social, environmental, legal, governmental and other criteria. See more in the
Compliance section of the "Evaluation" heading in this chapter.
Supplier evaluation under sustainability criteria in 2024
NCG N°519 - 7.2.III SUPPLIER EVALUATION
NATIONAL
FOREIGN
Percentage of total purchases of the
year from suppliers evaluated under
sustainability criteria
100%
100%
Quality and finance
At the time of creation, suppliers are evaluated on financial, due diligence,
related-party and age aspects to ensure that they comply with current company
guidelines. In addition, for technical suppliers, approval is required from LATAM
group's Quality department, which evaluates the certifications of each supplier and
determines their validity in order to comply with the highest quality standards.
Some of the main standards are:
FAA AND/OR EASA
DGAC
FAA AC 00-56
Compliance
Upon selection and initiation of services with a
supplier, LATAM group performs a monthly monitoring
of those that have received payments in the last
month, provided that they have not been reviewed in
the last year. This monitoring is carried out through
the Lexis Nexis platform, which evaluates social,
environmental, legal and governmental criteria, among
others. If any risk is detected, it is submitted to the
Compliance department for further investigation.
If a significant risk is identified, measures such
as action plans, payment suspension or, in severe
situations, contract termination are implemented.
The main purpose of this assessment is to ensure
compliance with the guidelines of LATAM group's
Compliance department.
ACTION PLANS FOR SUPPLIERS AND THIRD
PARTY INTERMEDIARIES (TPIS)
Specifically, on a monthly basis, LATAM group
monitors the potential risk warnings issued by
the Lexis Nexis platform regarding its Suppliers
and Third Party Intermediaries (TPIs). This review
involves the Compliance department, who must
define whether it is necessary to generate an
action plan or even review continuation of the
contract.
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GROUP
2024
Labor aspects and occupational safety
In Chile, LATAM group's Occupational Safety team
and the Chilean Safety Association (ACHS, for its
Spanish acronym) perform on-site evaluations
at airports, complemented by external audits
under standard DS594. Similarly, other countries
implement audits to verify compliance with local
labor regulations, such as the NR regulatory
standards in Brazil or the General Occupational
Health and Safety System in Colombia. For these
certifications, LATAM group relies on specialized
organizations in each country, ensuring a rigorous
approach adapted to local regulatory frameworks.
Information security
The Cybersecurity teams conduct specific
assessments to manage potential risks associated
with suppliers' cybersecurity practices. These
include a survey that requires documentary
evidence, such as certifications (SOX, IATA, ISO,
among others).
The evaluation is carried out prior to contracting
and periodically to classify suppliers based on
their level of technological risk and to monitor
their progress.
⚫ Technological risks (cybersecurity).
⚫ Compliance with standards (PCI, SOX, IATA,
ISO).
⚫ Data privacy.
⚫ Availability of replacement alternatives.
⚫ Impact on operational continuity.
⚫ Contract size.
The results make it possible to adjust monitoring
processes and controls. Additionally, technology and
systems providers are evaluated under standards
based on the NIST 800-161 and ISO 27001 framework,
as well as SOX and PCI-DSS validations, ensuring
alignment with best practices.
Environmental regulation
As part of LATAM group's sustainability strategy, audits
have been implemented to establish internal control
for compliance with environmental regulations. During
these processes, key documents are requested to
support compliance with environmental regulations,
such as waste management permits, chemical
handling training records, hazardous materials storage
conditions (HAZMAT) and waste transportation and/or
disposal manifests. If opportunities for improvement
are identified during the audit process, suppliers are
asked to establish action plans, which are monitored
through periodic follow-up meetings.
THIRD-PARTY MANAGEMENT: BRAZIL
In the Brazilian subsidiary, the Procurement department
has a team specializing in Third-Party Management,
which works together with Bernhoeft, an expert in
this sphere, to optimize the management of service
providers in the country.
Bernhoef supports the comprehensive and preventive
analysis of the legal, financial and occupational safety
documentation of suppliers in Brazil. This monitoring
provides the internal team with updated information,
which is presented to category managers to assist their
decision-making process.
When
gaps
are
detected,
improvement
plans
are implemented which may include updating
documentation, on-site visits, supplier training or other
corrective actions.
The purpose is to ensure partners’ legal compliance with
regard to their employees and reduce financial risks
associated with labor processes involving third parties,
thus ensuring a sustainable operation aligned with local
regulations.
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08 / SUPPLIERS
COMPLIANCE PROGRAM FOR SUPPLIERS AND
THIRD PARTY INTERMEDIARIES (TPIS)
LATAM group has a Compliance Program for Suppliers
and Third Party Intermediaries (TPIs), led by the
Compliance department, designed to assess the
maturity of its suppliers' compliance programs; this
aspect is prioritized in the contracting processes.
Initiated in 2023 with small local suppliers in Brazil,
the program was expanded in October 2024 to
strategic and critical Third Party Intermediaries (TPIs)
in Brazil, with the support of external consultant
CLA Brasil.
Specifically, evaluations are performed through
Due Diligence and questionnaires, analyzing the
information provided and generating reports with
the results. This program seeks to establish and
maintain a comprehensive record and control system
to ensure that suppliers adhere to the highest ethical
and legal standards.
With this initiative, LATAM group reiterates its
commitment to transparency, security, integrity
and accountability, promoting business relationships
that are based on trust and regulatory compliance.
EXTERNAL JETS SURVEY
As part of the cultural transformation that LATAM
group has undergone in the last two years, the Finance
areas have an external survey aimed at suppliers,
based on the JETS (Just, Empathetic, Transparent
and Simple) principles. This initiative evaluates the
negotiation, contract, invoicing and payment processes,
with the aim of measuring supplier perception in key
aspects such as complexity, service, knowledge and
approachability in each interaction.
In 2024, the survey yielded an NPS score of 30
points, positioning it in an area of "improvement" and
reflecting a change of +2 points compared to 2023.
These results make it possible to identify concrete
opportunities to optimize supplier relations and
processes, aligning them with the values of LATAM
group's cultural transformation.
182
SUPPLIERS EVALUATED
IN JETS CULTURAL
ALIGNMENT
80
COMPANIES ACHIEVED
AN OUTSTANDING RESULT
("Promoters" by NPS
methodology)
SUSTAINABLE SUPPLIER PROGRAM
(SSP)
Since early 2024, the Procurement and Sustainability
departments started to develop a Sustainable
Supplier Program (SSP), with the aim of learning
about supplier practices regarding Environmental,
Social and Governance (ESG) issues. This program
seeks both to establish the steps to be followed
for the development of a sustainable supply
chain and to establish sustainability criteria
throughout the life cycle of the suppliers that
render services to LATAM group.
As part of this program, the first ESG evaluation
was conducted on a segment of strategic, critical
and SME vendors, using surveys developed based
on the results of LATAM group's materiality
analysis and other best practice benchmarks,
such as the S&P Global Corporate Sustainability
Assessment.
The results obtained on 95 vendors surveyed
provide an initial diagnosis of ESG practices in
the supply chain, representing 40% of LATAM
group's total spending. Also, as part of the
development of the program, customized reports
will be delivered to the surveyed vendors, with
plans for improvement and good sustainability
practices.
See results on next page
› 190
LATAM
GROUP
2024
ABOVE EXPECTATIONS
Suppliers that meet or exceed all ESG criteria
established by LATAM group. They represent a
low risk and are examples of good sustainability
practices.
TOPICS SURVEYED IN THE SSP
ENVIRONMENTAL
⚫ Sustainability strategy or policy
⚫ Environmental management
⚫ Circular Economy
⚫ Environmental standards
⚫ Climate risk prevention
⚫ Waste distribution
SOCIAL
⚫ Human Rights and Due Diligence
⚫ Due Diligence in labor practices
⚫ Health and safety
⚫ Community outreach
GOVERNANCE
⚫ Compliance (compliance with ethics
and transparency policies)
⚫ Legislative compliance
⚫ Socio-environmental certifications
⚫ Materiality
⚫ Supplier evaluation
⚫ Inclusion of underrepresented groups
⚫ Non-discrimination
SPECIFIC COMPONENT BY CATEGORY1
⚫ Infrastructure
⚫ APV & catering
⚫ Fuels
⚫ Professional services
⚫ Employee services
⚫ Airports
45
FIRST ESG ASSESSMENT OF SUPPLIERS
NCG N°519: 7.2.I & II SUPPLIER EVALUATION
SUPPLIERS EVALUATED IN
SUSTAINABILITY ASPECTS
9
COMPANIES ACHIEVED AN
OUTSTANDING RESULT
50
SMES ASSESSED WITH AN
ADAPTED ESG INSTRUMENT.
1Each category is assessed based on the specific material aspects defined by the
SASB standards, which enables LATAM group to focus on the critical ESG issues
for each type of supplier. Each category is assessed based on the specific material
aspects defined by the SASB standards, which enables LATAM group to focus on
the critical ESG issues for each type of supplier.
RESULTS OF THE FIRST ESG SUPPLIER SURVEY
The results of the survey
developed as part of the
sustainable supplier program
made it possible to segment 45
LATAM group suppliers based
on their level of development in
terms of sustainability2.
2 In this first edition, 45 out of 110 invited suppliers
participated in the evaluation.
⚫ Presence of environmental incidents
⚫ Waste generation
⚫ Greenhouse gas emissions (GHG)
⚫ Water consumption
⚫ Energy consumption
WITHIN EXPECTATIONS
Suppliers with acceptable performance in terms of
sustainability, although with areas for improvement.
They do not represent immediate risks, but periodic
monitoring is recommended to encourage the
development of best practices.
CLOSE TO EXPECTATIONS
Suppliers that partially comply with
ESG criteria, but show deficiencies in
key areas, representing a moderate
risk. These suppliers are advised to
establish an improvement plan and close
monitoring to ensure the adoption of ESG
practices.
BELOW EXPECTATIONS
Suppliers that show a low performance in
ESG criteria. Most of these suppliers do not
adhere to ESG practices and need to review
and adopt them in the short term to align to
LATAM group’s minimum standards.
100%
RESULT
No OF SUPPLIER
80 TO 100 POINTS
9
60 TO 79 POINTS
16
40 TO 59 POINTS
11
0 TO 39 POINTS
9
36%
24%
20%
20%
› 191
⚫ Management
⚫ Uniforms
⚫ Marketing
⚫ Technical
⚫ IT & Systems
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2024
LATAM
GROUP
2024
08 / SUPPLIERS
Second Flight
LATAM group works with Latin American artisan
organizations to generate new products from its
employees’ discarded uniforms, which not only
reduces the environmental impact, but also creates
new employment and training opportunities for
the communities involved. See more in Chapter
“Sustainability”.
Vendor 360°
Since 2023, LATAM group implemented Vendor
360°, a strategic initiative designed to strengthen
relations with its key suppliers and generate mutual
operational and commercial improvements. This
initiative includes annual visits to review contracts and
services, identifying opportunities for optimization.
The visits bring together key supplier executives,
LATAM group's negotiation team and the internal
user, addressing topics such as operational growth,
adoption of new technologies, artificial intelligence
and sustainability, among other strategic challenges.
In its first two years, Vendor 360° has covered 78%
of LATAM group's strategic supplier expenditure,
consolidating itself as a key tool to foster collaboration
and continuous improvement in the supply chain.
In 2025, LATAM group will continue with the program
meetings, which facilitate a close relationship with
strategic suppliers, foster innovation, improve
communication and optimize operational efficiency,
aligning with the objectives of the Procurement
department.
Iniciativa estratégica diseñada
para fortalecer las relaciones
con sus proveedores
VENDOR 360º
› 192
In November 2024, LATAM group held the eighth
Procurement Bootcamp: a key space to foster
collaboration and strengthen supply management.
The procurement and negotiation teams of all the
group's affiliates participated in presentations on the
financial and digital strategy, the value proposition
of Human Capital, progress in Sustainability, and
the importance of Vendor Management.
PROCUREMENT
SUMMIT 2024
› 193
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2024
› 194
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2024
GUIDELINES
NCG 519: 5.9 OUTSOURCING POLICY
GRI 3-3, 2-24, 205-2
LATAM group’s vendor management is based on
guidelines to ensure supply quality, transparency,
competitiveness, legal compliance, safety and other
strategic aspects across all supply processes.
Along these lines, in 2024, the Procurement
Policy, which sets forth LATAM group’s guidelines
for procurement processes, was updated. These
updates include modifications that reinforce the
recommendations related to LATAM group's goals.
These policies establish clear expectations for LATAM
group vendors, which are communicated through
contractual agreements, periodic meetings and, in
the case of strategic and critical suppliers, through
direct communication led jointly by the commercial
and user areas.
In addition, the Procurement department's Planning
and Support team is responsible for updating and
effectively communicating internal policies and
procedures. Within this role, rigorous monitoring
controls are implemented to mitigate potential risks
linked to negotiation and procurement processes,
ensuring integrity and efficiency in the engagement
of suppliers for LATAM group.
CODE OF CONDUCT FOR SUPPLIERS AND
THIRD PARTY INTERMEDIARIES (TPIS)
As part of LATAM group’s commitment to sustainability
practices, anti-corruption laws, conflicts of interest,
and antitrust issues, as well as human rights, the
company encourages suppliers and third parties to
adhere to the Code of Conduct for Suppliers and
Third Party Intermediaries (TPIs) in all countries
where the organization operates.
Basic guidelines of the Code of Conduct for
Suppliers and Third Party Intermediaries (TPIs):
Conformity with applicable antitrust laws
⚫ Labor standards and practices
⚫ Health and safety
⚫ Brand, intellectual property, cybersecurity and
data protection
⚫ Environmental compliance and social
responsibility
⚫ Human Rights
⚫ Anti-corruption and crime prevention
PROCUREMENT POLICY
LATAM group has a Procurement Policy that sets
forth the guidelines for the acquisition of materials
and managed services. This document defines the
responsibilities of the Procurement department,
regulates procurement processes, and establishes
restrictions for directed purchases.
POLICIES FOR SUBCONTRACTORS
With regard to the selection of subcontractor
suppliers whose personnel will perform tasks
within its facilities, LATAM group has established
clear guidelines governing their engagement. These
guidelines are included as essential requirements
in the tender processes and, in turn, define the
obligations of service providers, ensuring compliance
with the legal and regulatory provisions applicable
to their personnel.
In fact, LATAM group's approach covers various
aspects, including obligations related to remuneration,
employee benefits, social security, work-related
accident regulations, occupational diseases and health
and safety aspects. All these points are explained
in LATAM group's contracts, which include a specific
annex dedicated to the labor obligations that these
suppliers are required to meet.
Moreover, LATAM group is strengthening its Contractor
Regulations as part of its guidelines. The aim of this
measure is to ensure the effective implementation of
the Health, Safety and Environment Policy, together
with its corresponding management system. Likewise,
LATAM group has begun to work on its Human Rights
Commitment to inform its contractors and suppliers
of the commitments undertaken in this arena.
PROCUREMENT POLICY UPDATE 2024
In 2024, the Corporate Procurement Policy was
updated to incorporate key modifications, such
as the classification and definition of critical and
non-critical suppliers, the specification of the
functions of the Procurement team and the Service
Level Agreements (SLA), restrictions for directed
purchases, process regularization, and sustainability
guidelines applicable to raw material tenders and
procurement. The document also explains buyers'
duties and expected response times, which bolsters
transparency and keeps users informed regarding
the details of each process. In addition, the new
policy gives preference to suppliers that comply
with sustainability guidelines, such as waste
reduction, recyclability of materials and obtaining
certifications linked to Circular Economy guidelines,
among other criteria.
It is important to note that, as part of the updating
process, the Procurement teams were trained in
the application of the new guidelines, thus ensuring
the correct implementation of the new Corporate
Procurement Policy, with particular emphasis on
sustainability aspects.
08 / SUPPLIERS
PAYMENT POLICIES
NCG 519: 7.1.I, 7.1.II, 7.1.III, 7.1.IV, AND 7.1.V PAYMENTS TO SUPPLIERS
The group’s Payment Policy applies equally to all
suppliers, and the terms of payment are established
based on what is negotiated in each contract1.
Therefore, proper compliance with the pre-established
number of days is monitored; this is 90 days, except
for small and medium-sized companies (SMEs),
in which case the regulations of each country are
observed, as established in specific policies for each
of LATAM group's affiliates.
During 2024, LATAM group continued to make progress
on improvements to the reception, digitization and
accounting platform to achieve an optimal payment
centralization. In fact, during the period, it was possible
to implement this process in 100% of LATAM group's
invoicing. In addition, following the implementation
of the new platform, which receives, digitizes and
records invoices throughout its operational network,
initiatives have continued to be developed to keep
suppliers informed throughout the payment process.
Thus, notifications are e-mailed to each supplier
upon receipt of an invoice, and they are subsequently
informed of the details on the payments they will
receive, including the dates and sums corresponding
to each invoice.
It should be noted that LATAM group does not
establish a maximum payment term target for its
suppliers, but rather monitors performance based
on payments made on time, in accordance with the
Payment to suppliers in 20242
UP TO 30 DAYS
FROM 31 TO 60 DAYS
MORE THAN 60 DAYS
NATIONAL
FOREIGN
NATIONAL
FOREIGN
NATIONAL
FOREIGN
Invoices paid during the year
175,301
49,353
44,399
52,297
66,508
48,598
Total paid (US$ million)
5,304
2,460
614
655
614
558
Total suppliers to whom the invoices
were paid in each range
3,683
928
2,671
811
3,233
1,009
payment terms agreed for each supplier.
On the other hand, in 2024, no agreements were
entered in the Chilean Ministry of Economy’s “Registry
of Agreements with an Exceptional Payment”.
1 With regard to requirement 7.1 Payment to Suppliers of NCG No. 519, no dis-
tinction is made between critical and non-critical suppliers in terms of payment
policies.
2 LATAM group did not incur in the payment of interest for late payment related to invoices issued. On the other hand, suppliers with a tax ID number (RUT, for its
Spanish acronym) from the same country as the contracting subsidiary are considered national.
› 195
LATAM
GROUP
2024
LATAM
GROUP
2024
› 196
08 / SUPPLIERS
Snapshot
CSA - SUPPLIER SELECTION AND EVALUATION
2021
2022
2023
2024
GRI 414-1, 414-2, 308-1 AND 308-2
Supply chain
Total LATAM group suppliers as at December 31, 2024
8,052
6,190
5,557
5,774
Critical Suppliers1
Share of the supplier base
11%
7%
5%
2.5%
Share of critical suppliers in acquisitions volume
91%
95%
69%
63%
Identification of potential risks
Suppliers analyzed by sustainability criteria2
NCG 519: 7.2 SUPPLIER EVALUATION
8,052
6,.190
5,557
5,774
% of the total suppliers analyzed2
100%
100%
100%
100%
% of total purchases2
100%
100%
100%
100%
Suppliers (TPIs) considered high-risk in terms of compliance3
148
369
185
307
Labor safety monitoring and management at Chilean airports4
Audited suppliers
40
53
48
N/D6
Suppliers with mitigation plans in place (% of suppliers audited)
93%
91%
94%
N/D6
Action plans defined based on audits
331
186
445
N/D6
Contracts terminated due to noncompliance
0
0
0
N/D6
Payment to suppliers
NCG 519: 7.1 PAYMENT TO SUPPLIERS
% of invoices paid with a term of up to 30 days
National
N/D
81%
65%
61%
Foreign
N/D
63%
51%
33%
N/A: Not Available.
1 Contracts in excess of US$1 million. Suppliers interacting with government agencies on
behalf of LATAM group or supplying the operation with essential or difficult to replace
elements.
2 The evaluations explained in the "Compliance" section under the "Evaluation" heading
of this chapter are considered.
3 The number of cases of warnings issued by the system to detect potential compliance
risks in Suppliers and Third Party Intermediaries (TPI) is reported. It is essential to clarify
that all cases were reviewed, and no cases were found where it was necessary to gene-
rate action plans or other measures.
4 Information corresponding to contractors in Chile only.
5 One supplier did not attend the audit. Support has been provided to the 45 suppliers to
assist with the implementation of their action and mitigation plans.
6 The audits consist of the analysis of information relating to deferred years, with a focus
on occupational health and safety. The 2024 audits will be conducted in March and April
2025, and their results will be available during the year.
› 197
11 / ABOUT THE REPORT
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GROUP
2024
11
_ABOUT THE REPORT
198 MATERIAL TOPICS
201 GRI AND SASB CONTENT INDEX
206 NCG 519 CONTENT INDEX
207 GLOSSARY
208 EXTERNAL ASSURANCE
› 198
11 / ABOUT THE REPORT
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2024
03
01 02
NCG 519: 3.1 GOVERNANCE FRAMEWORK
GRI 2-29, 3-1, 2-14 AND 3-2
In 2023, LATAM group updated its list of material
topics in sustainability. For the first time, this
process was carried out following the guidelines of
double materiality, a methodology promoted by
the European Sustainability Reporting Standards
(ESRS), with the aim of adopting best practices in
sustainability reporting and indicators.
The double materiality approach implies that
companies must disclose not only the impacts that
their activity has on society, the environment and
governance systems, but also how these aspects can
affect the company itself in terms of its development,
performance and position. In other words, it considers
both the influence that the company exerts on its
environment and stakeholders (impact materiality),
and the influence that said environment may have
on the company itself (financial materiality).
During 2024, the Sustainability and Corporate Affairs
department reviewed the exercise and decided to
maintain the previous results of the matrix, material
topics, and list of risks, opportunities and impacts.
A new update of the study is planned for the next
period, following the methodology and its relevant
updates.
The selection of content for the LATAM Annual Report
2024 was based on the material topics considered
MATERIAL TOPICS
most relevant, which are presented in the double
materiality matrix included in this report.
PROCESS
Step 1: Identification of risks, issues and
opportunities (RIOs)
1 The methodology proposed by the ESRS guided the process to draft the double
materiality. However, disclosure requirements are still an opportunity that could
be applied in future LATAM group Annual Report exercises.
A thorough diagnosis was carried out to create a list
of positive and negative impacts of the organization
on its surroundings (environment and society), as
well as risks and opportunities for the development
of the business. This list was compiled based on
internal and external information, which made it
possible to gather LATAM group’s experiences, as
well as its stakeholders’ outlook and cases of airline
industry benchmarks. In addition, this list included
RIOs from LATAM group's operation and value chain.
⚫ Internal Information: The company's strategic
documentation, such as policies and processes, was
analyzed and more than 30 expert leaders from
various departments were interviewed.
⚫ External Information: The results of surveys
conducted with stakeholders (customers, employees,
and shareholders, among others) were evaluated;
representatives of these groups were interviewed;
benchmarking was carried out with airline industry
players; and sustainability standards and indices
were examined, while other sources, such as news
and social media, were analyzed as well.
Step 2: Impact Assessment and Construction of
Material Topics
⚫ Workshops: Workshops were held with representatives
from different countries and areas of the company
to assess impacts, risks and opportunities according
to severity and probability factors.
⚫ Grouping: These impacts, risks and opportunities
were grouped into sub-topics and then into material
topics.
The impacts, risks and opportunities were evaluated
based on their severity, on a scale from one to five for
each of the factors: scale, scope and irremediability
(the latter only for risks or negative impacts). Likewise,
the assessment considered probability, also on a
scale from one to five.
In addition, a materiality threshold was established
to define the most important impacts, risks and
opportunities, which were then grouped together to
construct the material topics.
Step 3: Prioritization of material topics and
drafting of final matrix
The prioritization of the material topics and the
development of the final matrix was done through
a thorough process of evaluation, prioritization and
validation.
⚫ Evaluation and prioritization: The assessment of
impacts, risks and opportunities made it possible to
prioritize the material issues in a double materiality
matrix.
⚫ Validation: This matrix was validated by the Director
of Corporate Affairs and Sustainability, the Director
of Internal Audit, Risk and Control, and last, by the
CEO of LATAM Airlines Group S.A.
It should be noted that LATAM group reviews on an
annual basis the need to update its material topics
to adapt in an agile manner to the constant changes
in the environment, always maintaining a focus
on continuous improvement in its sustainability
management.
11 / ABOUT THE REPORT
LATAM
GROUP
2024
1
2
4
3
5
8
10
11
12
25%
25%
50%
75%
100%
50%
75%
100%
FINANCIAL MATERIALITY
● Low
● Moderate
● High
IMPACT MATERIALITY
13
7
6
9
CLIMATE CHANGE STRATEGY
CONNECTIVITY AND
REGIONAL DEVELOPMENT
ECOSYSTEM
PROTECTION
HUMAN RIGHTS
ACCOUNTABILITY
AND COLLABORATION
WITH SUPPLIERS
ETHICS AND
COMPLIANCE
CUSTOMER
EXPERIENCE
SUSTAINABLE
INNOVATION
OPERATIONAL
SAFETY
CONTINUOUS
ADAPTATION TO
THE ENVIRONMENT
HUMAN
RESOURCES
DOUBLE MATERIALITY MATRIX
FLEET
EFFICIENCY
LATAM
2024
› 199
MATERIAL TOPICS
N° 1 CLIMATE CHANGE STRATEGY
LATAM group seeks to mitigate climate impact, ensuring
the continuity and resilience of its operations through the
implementation of measures for climate change adaptation.
N°2 DIGITAL TRANSFORMATION AND CYBERSECURITY
Given the technological development and ongoing digital
transformation, LATAM group’s efforts focus on information
management and on strengthening security to maintain
the protection of its systems and operations against
any security breach. In this way, information privacy is
incorporated as a priority for the protection of customers’
and employees’ personal data.
N°3 CUSTOMER EXPERIENCE
LATAM group focuses on offering a rewarding experience
through its services, prioritizing adaptability to meet the
various requirements of each type of client. In the Cargo
business, LATAM group strives to ensure that cargo arrives
on time and in optimal condition.
N°4 SUSTAINABLE INNOVATION
LATAM group aims to be a benchmark in the aviation industry
through the implementation and dissemination of cutting-
edge solutions in sustainability issues, comprehensively
addressing the challenges of the sector. Likewise, it focuses
on promoting innovative measures throughout the value
chain for effective waste management, integrating the
principles of circular economy. This transition relies on
suppliers, authorities and other key players that influence
operations, with whom LATAM group will seek to collaborate
strategically.
DIGITAL TRANSFORMATION
AND CYBERSECURITY
11 / ABOUT THE REPORT
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GROUP
2024
N°9 CONTINUOUS ADAPTATION TO THE ENVIRONMENT
LATAM group is oriented towards continuous adaptation,
proactive risk management and resilience in a complex
and changing global environment. In this context, it has
the structures and bases to be able to adapt to different
political, economic and social contexts, considering both
shifts in the market and all its stakeholders.
N°10 CONNECTIVITY AND REGIONAL DEVELOPMENT
LATAM group drives the social, environmental and economic
development of South America through connectivity and
tourism. Likewise, it seeks to contribute through its business
and what it knows how to do: connect.
N°11 HUMAN RIGHTS
LATAM group safeguards Human Rights and individuals’
integrity through the implementation of policies and related
practices. Along these lines, it promotes gender equality,
prevents human trafficking, ensures development within a
healthy environment and avoids any form of discrimination,
among others. All of the above, ensuring a fair and respectful
treatment for all individuals and communities, considering
our clients, employees, contractors and suppliers.
N°12 ETHICS AND COMPLIANCE
LATAM group promotes corporate integrity and accountability
across all its operations, with a strategic focus that includes
compliance programs with employees and suppliers. In
addition, it addresses uncertainty related to emerging
regulations and regulatory transformations by anticipating
and adopting best regulatory practices among the different
countries where it operates, in addition to international
standards.
N°13 ACCOUNTABILITY AND COLLABORATION WITH
SUPPLIERS
LATAM group develops and fosters sustainable and ethical
relationships with its supply chain in a collaborative manner.
Thus, it generates strategies to advance the integration of
good practices that allow it to accompany suppliers and
incorporate sustainability in business development.
N°5 OPERATIONAL SAFETY
LATAM group prioritizes incident and accident prevention
throughout its operations, implementing proactive measures
targeting the development of best practices both in the air
and on the ground. In addition, it guarantees the health and
safety of its team, customers and suppliers by fostering
an environment where everyone feels protected.
N°6 FLEET EFFICIENCY
LATAM group continues to make progress in renovating its
fleet and incorporating technological improvements in its
aircraft, with a focus on reducing fuel consumption. This
effort seeks to improve flight planning, reduce emissions
and avoid service interruptions caused by extended periods
of aircraft maintenance.
N°7 HUMAN RESOURCES
LATAM group promotes the development of internal
capabilities among its employees, fostering an environment
of continuous learning and personal growth. It aims for the
work performed to be recognized and valued, contributing to
the creation of a motivating work environment. In addition,
it focuses on building meaningful relationships that allow
it to reach fair agreements with employee representatives.
N°8 ECOSYSTEM PROTECTION
LATAM group implements programs designed to protect,
conserve and rehabilitate ecosystems and their biodiversity.
As an established airline in South America, its contribution
focuses primarily on preventing wildlife trafficking, as well
as promoting nature-based solutions through collaborative
work to safeguard the region's ecosystems, recognizing
their fundamental paper in carbon sequestration.
LATAM
2024
MATERIAL
TOPICS
CHANGES FROM 2018 MATERIALITY
GRI 3-2
Tres temas materiales nuevos se incorporan a la
doble materialidad 2023: “Transformación digital y
ciberseguridad”, “Derechos Humanos” y “Responsabilidad
y colaboración con proveedores”. Por otro lado, el tema
material 2018 “Sostenibilidad económica y financiera”
deja de ser parte de la matriz. Los temas materiales
restantes de este nuevo ejercicio integran aspectos
de los demás temas materiales anteriores, con un
enfoque distinto, que se presenta en su cambio de
nombre y definición.
› 200
› 201
11 / ABOUT THE REPORT
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GROUP
2024
GRI AND SASB
CONTENT INDEX
DECLARATION OF USE
NCG 519: 9. SOSTENIBILIDAD - 9.1 MÉTRICAS SASB
LATAM Airlines Group S.A. has presented the
information cited in this GRI content index for the
period from January 1 to December 31, 2024, based
on the GRI Standards.
In addition, as part of the requirements of Chilean
general standard (NCG) No. 519, it reports the
metrics defined by the Sustainability Accounting
Standards Board (SASB) for the transportation
industry, specifically the airline sector. It is worth
mentioning that this reporting industry classification
was approved by the Board of Directors.
GRI 1 USED
GRI 1: 2021 FUNDAMENTALS
GRI/ SASB STANDARD AIRLINES
GRI 2: GENERAL CONTENTS 2021
PÁGINAS
2-1 Organizational details
14, 211,
214-215
2-2 Entities included in the organization’s sustainability reporting
4-5
2-3 Reporting period, frequency and contact point
4-6
2-4 Restatements of information
153, 162
2-5 External assurance
5, 208
2-6 Activities, value chain and other business relationships
14, 83, 77-80,
182, 184-185
2-7 Employees
112, 269-274
2-8 Workers who are not employees
184
2-9 Governance structure and composition
33, 40-45
2-10 Designation and selection of the highest governance body
40
2-11 Chair of the highest governance body
40-41
2-12 Role of the highest governance body in overseeing the manage-
ment of impacts
48
2-13 Delegation of responsibility for managing impacts
48
2-14 Role of the highest governance body in sustainability reporting
198
2-15 Conflicts of interest
56
2-16 Communication of critical concerns
59-60
2-17 Collective knowledge of the highest governance body
40
2-18 Evaluation of the performance of the highest governance body
40
2-19 Remuneration policies
46, 52-54
2-20 proceso para determinar la remuneración
52-54
2-21 Ratio de compensación total anual
N/D
2-22 Statement of sustainable development strategy Statement of
sustainable development strategy
9-11
2-23 Commitments and policies
130-131
2-24 Incorporación de los compromisos y políticas
55-59, 105,
131, 194
2-25 Procesos para remediar los impactos negativos
59, 67-68, 101
2-26 Mechanisms for seeking advice and raising concerns
55, 59, 183
2-27 Compliance with laws and regulations
55-57, 134
2-28 Membership associations
69
2-29 Approach to stakeholder engagement
67-68, 198
2-30 Collective bargaining agreements
275
GRI 3: MATERIAL TOPICS 2021
3-1 Process to determine material topics
198
3-2 List of material topics
199-200
› 202
11 / ABOUT THE REPORT
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2024
GRI/ SASB standard airlines
MATERIAL TOPIC
TABLE OF CONTENTS
PAGES
CLIMATE CHANGE STRATEGY
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
140-150, 262-270
V SASB AIRLINES- GHG EMISSIONS
TR-AL-110a.1 Gross global Scope 1 emissions
149, 162
TR-AL-110a.2 Analysis of the long- and short-term strategy or plan to manage Scope 1 emissions, emission reduction
targets and analysis of outcomes related to these targets
127, 140-149, 258-266
TR-AL-110a.3 Total fuel consumed, percentage alternative, percentage sustainable
137, 265
GRI 302: ENERGY 2016
302-1 Energy consumption within the organization
136-137, 162
302-3 Energy intensity
136, 162
GRI 305: EMISSIONS 2016
305-1 Direct (Scope 1) GHG emissions
149, 162
305-2 Energy indirect (Scope 2) GHG emissions
149, 162
305-3 Other indirect (Scope 3) GHG emissions
149-150, 162
305-4 GHG emissions intensity
150
305-5 Reduction of GHG emissions
127, 149
305-6 Emissions of ozone-depleting substances
265
305-7 Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions
265
MATERIAL TOPIC: DIGITAL TRANSFORMATION AND
CYBERSECURITY
GRI MATERIAL TOPICS
3-3 Management of material topics
103-109
GRI 418: CUSTOMER PRIVACY
418-1 Substantiated complaints regarding breaches of customer privacy and loss of customer data
60, 108
MATERIAL TOPIC: CUSTOMER EXPERIENCE
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
89-101
OTHER INDICATORS
Net Promoter Score
98, 100
OTP (on time performance)
100 y 110
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2024
MATERIAL TOPIC
TABLE OF CONTENTS
PAGES
SUSTAINABLE INNOVATION
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
151-158, 267-268
GRI 306: WASTE 2020
306-2 Management of significant waste-related impacts
151-158
306-3 Waste generated
138-139
306-4 Residuos no destinados a eliminación
139, 162
306-5 Waste directed to disposal
139, 162
OPERATIONAL SAFETY
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
164-180
GRI 403: OCCUPATIONAL HEALTH AND SAFETY 2018
403-1 Occupational health and safety management system
171-172
403-2 Hazard identification, risk assessment and incident investigation
171-176
403-5 Occupational health and safety training for employees
173-174
403-7 Prevention and mitigation of occupation health and safety impacts directly linked by business relationships
167-175
403-9 Work-related injuries
176
SASB AIRLINES- ACCIDENT AND SAFETY MANAGEMENT
TR-AL- 540a.1 Description of implementation and outcomes of a Safety Management System
164-180
TR-AL-540a.2 Number of aviation accidents
180
TR-AL-540A.3 Number of governmental enforcement actions of aviation safety regulations
180
FLEET EFFICIENCY
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
84-88, 146, 286
SASB AIRLINES - ACTIVITY METRICS
TR-AL-000.A Available seat-kilometers (ASK)
88
TR-AL-000.B Passenger load factor
88
TR-AL-000.C Revenue passenger-kilometers (RPK)
88
TR-AL-000.D Revenue ton-kilometers (RTK)
88
TR-AL-000.E Number of exits
88
TR-AL-000.F Average age of fleet
84
› 204
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2024
MATERIAL TOPIC
TABLE OF CONTENTS
PAGES
TEAM
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
111-123
GRI 401: EMPLEO 2016
401-1 Hiring of new employees and staff turnover
117-118, 123
401-2 Benefits for full-time employees that are not provided to part-time or temporary workers
119-120
401-3 Postnatal leave
120, 277
GRI 404: TRAINING AND EDUCATION 2016
404-1 Average hours of training per year per employee
115, 279
404-3 Percentage of employees receiving regular performance and career development evaluations
116
SASB AIRLINES - LABOR PRACTICES
TR-AL-310a.1 Percentage of active workforce covered under collective bargaining agreements
275
TR-AL-310a.2 Number of work stoppages and total days idle
275
OTHER INDICATORS
Organizational Health Index (OHI)
114
ECOSYSTEM PROTECTION
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
145
CONTINUOUS ADAPTATION TO THE ENVIRONMENT
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
62-66, 238-255
CONNECTIVITY AND REGIONAL DEVELOPMENT
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
159-161
GRI 201: ECONOMIC PERFORMANCE 2016
201-1 Direct economic value generated and distributed
27
GRI 203: INDIRECT ECONOMIC IMPACTS 2016
203-1 Infrastructure investments and services supported
162
203-2 Significant indirect economic impacts
79-80, 82
OTHER INDICATORS
Destinations
14
› 205
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2024
MATERIAL TOPIC
TABLE OF CONTENTS
PAGES
HUMAN RIGHTS
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
131
GRI 405: DIVERSITY AND EQUAL OPPORTUNITIES 2016
405-1 Diversity of governing bodies and employees
121-122, 269-274
405-2 Ratio between basic salary and remuneration of women and men
122
GRI 406: NON-DISCRIMINATION 2016
406-1 Cases of discrimination and corrective actions taken
59-60
ETHICS AND COMPLIANCE
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
55-61
GRI 205: ANTI-CORRUPTION 2016
205-2 Communication and training about anti-corruption policies and procedures
58, 60, 194
205-3 Confirmed incidents of corruption and measures taken
56, 58, 60
GRI 206: ANTI-COMPETITIVE BEHAVIOR 2016
206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices
55
GRI 415: PUBLIC POLICY 2016
415-1 Political contributions
57, 222-223
SASB AIRLINES- ANTI-COMPETITIVE BEHAVIOR
TR-AL-520a.1 Total amount of monetary losses as a result of legal proceedings associated with anti-competitive behavior
regulations
56
ACCOUNTABILITY AND COLLABORATION WITH SUPPLIERS
GRI 3 MATERIAL TOPICS
3-3 Management of material topics
181-196
GRI 414: SUPPLIER SOCIAL EVALUATION
GRI 414-1 New suppliers that have passed selection filters according to social criteria
187
GRI 414-2 Negative social impacts on the supply chain and measures taken
196
OTHER GRI AND SASB INDICATORS REPORTED
GRI 303: WATER AND EFFLUENTS 2018
303-3 Water extraction
135
› 206
11 / ABOUT THE REPORT
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GROUP
2024
CONTENT INDEX
NCG N°519
CHILEAN GENERAL REGULATION NO. 519
NCG 519: 1. ÍNDICE DE CONTENIDOS
2. ORGANIZATION’S PROFILE
2.1 Mission, vision, purpose and values
16
2.2 Historical Information
19-20
2.3 Ownership
2.3.1 Control situation
34
2.3.2 Major changes in ownership or control
35-37
2.3.3 Identification of majority partners or shareholders
35, 37
2.3.4 Stocks, their characteristics and rights
31, 34, 37-38, 55
2.3.5 Other Securities
34
3. CORPORATE GOVERNANCE
3.1 Governance framework
33, 48-49, 55-58,
67-68, 102, 117,
121, 131, 146-
147, 160, 198, 258
3.2 Board of Directors
40-48, 58, 63,
220
3.3 Board Committees
33, 46-48, 63,
218-220
3.4 Senior Executives
35, 50-54
3.5 Adherence to national or international codes
55
3.6 Risk management
48, 52, 55-56, 58-
59, 61-66, 107,
117, 147, 238-255,
258-262
3.7 Relationship with stakeholders and the general public
39-40, 67-68
4. STRATEGY
4.1 Time horizons
213
4.2 Strategic objectives
17, 48, 125, 130
4.3 Investment plans
29-30
5. PEOPLE
5.1 Staffing
5.1.1 Number of individuals by sex
122, 269
5.1.2 Number of individuals by nationality
270-272
5.1.3 Number of individuals by age range
273
5.1.4 Labor seniority
273
5.1.5 Number of individuals with disabilities
274
5.2 Labor formality
274
5.3 Work adaptability
274
5.4 Wage equity by sex
5.4.1 Equality policy
121-122
5.4.2 Wage gap
122
5.5 Workplace and sexual harassment
59-61
5.6 Job safety
171-176
5.7 Postnatal leave
119-120, 277-278
5.8 Training and benefits
115, 119-120, 279
5.9 Outsourcing policy
194
6. BUSINESS MODEL
6.1 Industrial sector
14-15, 67, 76-78,
80, 82, 225-231
6.2 Businesses
14-15, 25, 76, 96,
110, 182, 184,
214-215
6.3 Stakeholders
67-69
6.4 Properties and facilities
211-212
6.5 Subsidiaries, partners and investments in other
companies
6.5.1 Subsidiaries and partners
372-386
6.5.2 Investment in other companies
N/A
7. SUPPLIERS
7.1 Payment to suppliers
195-196
7.2 Supplier assessment
186-188, 191,
196
8. LEGAL AND REGULATORY COMPLIANCE
8.1 Regarding customers
56
8.2 Regarding its workers
56, 59
8.3 Environmental
133-134
8.4 Free competition
56
8.5 Others
56
9. SOSTENIBILIDAD
9.1 Métricas SASB
56, 84, 88, 126,
137, 140, 149,
162, 164, 166,
168, 179-180
9.2 Verificación independiente
5, 208
10. RELEVANT OR ESSENTIAL EVENTS
231-238
11. COMMENTS FROM SHAREHOLDERS AND THE
BOARD OF DIRECTORS
220
12. FINANCIAL INFORMATION
285-371
11 / ABOUT THE REPORT
LATAM
GROUP
2024
GLOSSARY
ADR: American Depositary Receipt
AFPs: Spanish acronym for Chilean Pension Fund
Managers
ANAC: National Civil Aviation Agency—Brazil
ASK: Available seat kilometers (equivalent to the
number of available seats multiplied by the distance
traveled)
ATK: Available ton-kilometers (equivalent to the total
available capacity in tons multiplied by the distance
flown)
CMF: Spanish acronym for the Financial Market
Commission (Chile)
CORSIA: United Nations Carbon Offsetting and
Reduction Scheme for International Aviation
DIP: Debtor-in-Possession, a financing mechanism
provided for in Chapter 11 of the U.S. law in which
loan creditors have priority in receiving securities)
EBITDA: Earnings Before Interest, Taxes, Depreciation,
and Amortization
EBITDAR: Earnings Before Interest, Taxes,
Depreciation, Amortization, and Rent
GHG: Greenhouse gases
GRI: Global Reporting Initiative
IATA: International Air Transport Association
IEnvA: IATA Environmental Assessment
IFRS: International Financial Reporting Standard
IOSA: IATA Operational Safety Audit JBA: Joint
Business Agreement
LSA: Chilean Corporations Act.
MRO: Maintenance, Repair, and Overhaul
NPS: Net Promoter Score
NYSE: New York Stock Exchange
ICAO: International Civil Aviation Organization.
SDG: United Nations’ Sustainable Development Goals.
OHI: Organizational Health Index
UN: United Nations Organization
OTC: Over-the-counter (financial instruments are
traded directly between the parties, outside the scope
of organized markets)
OTP: On-time performance or Punctuality Indicator
(measures the capacity of an airline or transport
company to operate its flights or services within the
scheduled timetable)
SSC: Spanish-speaking countries
RASK: Available seat-kilometer (equivalent to the
efficiency of the airline, obtained by dividing the
operating income by the ASK)
RPK: Revenue passenger-kilometer (equivalent to
total paid passengers multiplied by distance traveled)
RTK: Revenue ton-kilometer (equivalent to total tons
transported multiplied by distance traveled)
SEC: US Securities and Exchange Commission
TDLC: Spanish acronym for the Chilean Antitrust Court
› 207
GRUPO
LATAM
2024
› 208
11 / ABOUT THE REPORT
LATAM
GROUP
2024
INDEPENDENT PRACTITIONER’S LIMITED ASSURANCE REPORT ON LATAM
AIRLINES GROUP S.A.’S IDENTIFIED SUSTAINABILITY INFORMATION
(A free translation from the original in Spanish)
Santiago, March 7th, 2025
To the Shareholders and Board of Directors
LATAM Airlines Group S.A.
Scope
We have undertaken a limited assurance engagement on the sustainability information identified below
included in LATAM Airlines Group S.A.’s integrated report for the year ended on December 31st, 2024
('the 2024 Integrated Report') (the 'Identified Sustainability Information'). This engagement was
conducted by a multidisciplinary team.
Identified Sustainability Information
The Identified Sustainability Information for the year ended on December 31st, 2024, includes the GRI
and SASB indicators specified in the section 'GRI and SASB Content Index' of Chapter 11 'About the
Report' (pages 201 to 205) and the data for the Corporate Sustainability Assessment (CSA) indicated on
pages 135, 137, 139, 149, 150, 176, 187, 196, 269, 272, 280 and 281 of the Integrated Report.
Our limited assurance engagement was performed on the year ended December 31st, 2024, information
only and we have not performed any procedures with respect to earlier periods or any other elements
included in the 2024 integrated report and, therefore, do not express any conclusion thereon.
Criteria
The criteria used by LATAM Airlines Group S.A. to prepare the Identified Sustainability Information are
established in the Prologue on page 4 and in the section 'GRI and SASB Content Index' of Chapter 11
'About the Report', on page 201 of the 2024 Integrated Report (hereinafter 'the Criteria'), and considers
the standards set by the Global Reporting Initiative (GRI) and the Sustainability Accounting Standards
Board (SASB).
LATAM Airlines Group S.A. Responsibility for the Identified Sustainability Information
LATAM Airlines Group S.A. management is responsible for the preparation of the Identified
Sustainability Information in accordance with the Criteria. This responsibility includes the design,
implementation and maintenance of internal control relevant to the preparation of Identified
Sustainability Information that is free from material misstatement, whether due to fraud or error.
Inherent limitations
The absence of a significant body of established practice on which to draw to evaluate and measure non-
financial information allows for different, but acceptable, measures and measurement techniques and
can affect comparability between entities. In addition, GHG quantification is subject to inherent
uncertainty because of incomplete scientific knowledge used to determine emissions factors and the
values needed to combine emissions of different gases.The selection by management of different but
acceptable measurement techniques could have resulted in materially different amounts or metrics.
Our independence and quality management
We have complied with the independence and other ethical requirements of the International Code of
Ethics for Professional Accountants (including International Independence Standards) issued by the
International Ethics Standards Board for Accountants (IESBA Code), which is founded on fundamental
principles of integrity, objectivity, professional competence and due care, confidentiality and
professional behavior.
The firm applies International Standard on Quality Management 1, which requires the firm to design,
implement and operate a system of quality management including policies or procedures regarding
compliance with ethical requirements, professional standards and applicable legal and regulatory
requirements.
Our responsibility
Our responsibility is to express a limited assurance conclusion on the Identified Sustainability
Information based on the procedures we have performed and the evidence we have obtained. We
conducted our limited assurance engagement in accordance with International Standard on Assurance
Engagements 3000 (Revised), Assurance Engagements other than Audits or Reviews of Historical
Financial Information, issued by the International Auditing and Assurance Standards Board. These
standards require that we plan and perform this engagement to obtain limited assurance about whether
the Identified Sustainability Information is free from material misstatement.
A limited assurance engagement involves assessing the suitability in the circumstances of LATAM
Airlines Group S.A. use of the Criteria as the basis for the preparation of the Identified Sustainability
Information, assessing the risks of material misstatement of the Identified Sustainability Information
whether due to fraud or error, responding to the assessed risks as necessary in the circumstances, and
evaluating the overall presentation of the Identified Sustainability Information. A limited assurance
engagement is substantially less in scope than a reasonable assurance engagement in relation to both
the risk assessment procedures, including an understanding of internal control, and the procedures
performed in response to the assessed risks.
The procedures we performed were based on our professional judgment and included inquiries,
observation of processes performed, inspection of documents, analytical procedures, evaluating the
appropriateness of quantification methods and reporting policies, and agreeing or reconciling with
underlying records.
Given the circumstances of the engagement, in performing the procedures listed above we:
•
Made inquiries of the persons responsible for the Identified Sustainability Information.
•
Obtained an understanding of the process for collecting and reporting the Identified Sustainability
Information;
•
Performed limited substantive testing on a selective basis of the Identified Sustainability
Information at corporate head office to check that data had been appropriately measured, recorded,
collated and reported; and is consistent with its supporting documents and/or comes from sources
that have verifiable supports;
•
Verified that the financial information included as part of the Identified Sustainability Information
is derived either from accounting records or from financial statements audited by an independent
auditing firm as of December 31st, 2024.
The procedures performed in a limited assurance engagement vary in nature and timing from, and are
less in extent than for, a reasonable assurance engagement. Consequently, the level of assurance
obtained in a limited assurance engagement is substantially lower than the assurance that would have
been obtained had we performed a reasonable assurance engagement. Accordingly, we do not express a
reasonable assurance opinion about whether LATAM Airlines Group S.A. Identified Sustainability
Information has been prepared, in all material respects, in accordance with the Criteria.
Limited assurance conclusion
Based on the procedures we have performed and the evidence we have obtained, nothing has come to
our attention that causes us to believe that LATAM Airlines Group S.A.’s Identified Sustainability
Information included in the Integrated Report for the year ended on December 31st, 2024, is not
prepared, in all material respects, in accordance with the Criteria.
Héctor Cabrera M.
Partner
EXTERNAL ASSURANCE
› 209
LATAM
GROUP
2024
INDEPENDENT REVIEW REPORT OF LATAM DOUBLE MATERIALITY STUDY 2023
Mr.
Juan José Tohá,
Director of Corporate Affairs and Sustainability
LATAM Airlines
Present
From our consideration:
We have reviewed the following aspects of the Double Materiality Study carried out by LATAM Airlines Group
S.A (LATAM):
Standard & Scope
The review of the double materiality study was carried out in accordance with the European Sustainability
Reporting Standard (ESRS), an initiative of the European Financial Reporting Advisory Group (EFRAG) in
collaboration with the Corporate Sustainability Reporting Directive (CDRS) of the European Commission.
The ESRS standard incorporates both methodological and disclosure criteria. This independent review is
limited only to the analysis of the metholodogical criteria. The requirements associated with the disclosure
stage were not considered in the scope of the process of preparing the double materiality study and,
therefore, not in the independent review.
Independent Review Process
Our review work has consisted of the analysis of the evidence provided by LATAM to support the exercise it
carried out for its double materiality study. In each of the steps, the respective evidence was analyzed to
understand how the analysis was carried out and whether it aligned with what was required by the ESRS and
ESRS 2. For this review, we examined the application of analytical procedures and study tests described
below:
•
We met with the counterpart in charge of preparing the double materiality study to clarify doubts and
review the methodology applied.
•
We analysed the evidence presented to verify the analysis process, including the methodological
application, the results obtained and the parties involved in the process.
•
We carried out review tests of quantitative and qualitative information, ensuring that the methodological
requirements established by the standard were met.
Conclusions
As a result of the independent review process, having evaluated the criteria mentioned in the Business
Sustainability Reporting Standard (ESRS), we can conclude that the evidence has been presented to
indicate that the Double Materiality Study conducted by LATAM was carried out following the guidelines
established in ESRS 1 and ESRS 2. Specifically, the following sections of the ESRS standard were reviewed:
1 3; 3.1; 3.2; 3.3; 3.4; 3.5; 3.6; 3.7 and ESRS 2 SBM-3; IRO-1; IRO-2.
We appreciate LATAM's cooperation and willingness during the review process. If you have any questions or
require more information, please do not hesitate to contact us.
Manuel Gálvez
Partner
Mar 21, 2024
Deloitte Consultoría Limitada
Rosario Norte 407
Las Condes, Santiago
Chile
Fono: (56) 227 297 000
Fax: (56) 223 749 177
deloittechile@deloitte.com
www.deloitte.cl
11 / ABOUT THE REPORT
Note: The letter corresponds to the verification of the previous year (2023), as it has been decided to maintain the previous double materiality analysis without changes.
LATAM
GROUP
2024
› 210
12 / ANNEXES
12
_ANNEXES
211 WHO WE ARE
216 CORPORATE GOVERNANCE
225 OUR BUSINESS
260 SUPPLIERS
261 COMMITMENT TO SUSTAINABILITY
273 EMPLOYEES
284 ABOUT THIS REPORT
LATAM
GROUP
2024
› 211
12 / ANNEXES
WHO WE ARE
GRI 2-1
LEGAL INCORPORATION
It was established as a Limited Liability Company
via a public deed dated December 30, 1983 before
Notary Eduardo Avello Arellano; an excerpt of this
deed is recorded in the Santiago Commerce Registry
on page 20,341 item 11,248 of the year 1983, and
published in the Official Gazette on December 31,
1983.
Pursuant to the public deed dated August 20, 1985,
granted by Notary Miguel Garay Figueroas Office, the
company became a Limited Corporation known as
Línea Aérea Nacional Chile S.A. (now, LATAM Airlines
Group S.A.) which, by express provision of law N°
18,400, has the quality of legal follower of the state-
owned company created in the year 1929 under the
name Línea Aérea Nacional de Chile, pursuant to the
aeronautical and radio communications concessions,
traffic rights, and other administrative concessions.
COMPANY PURPOSE
⚫ To market air and/or ground transportation in any
of its forms, be it for passengers, cargo, mail, and
anything directly or indirectly related to that activity
within or outside the country, on its own behalf or
for third parties.
⚫ To render services related to the maintenance and
repair of its own or third parties’ aircraft.
⚫ To develop and operate other activities derived
from and/or related, connected, contributing, or
complementary to the company's corporate purpose;
⚫ Trade and development of activities related to
travel, tourism, and lodging.
⚫ To develop and operate other activities derived
from and/or related, connected, contributing, or
complementary to the company's corporate purpose;
⚫ To participate in partnerships of any kind that will
enable the company to fulfill its goals.
PROPERTY, PLANT AND EQUIPMENT
NCG 519: 6.4.I PROPERTIES AND FACILITIES
Chile
Headquarters: The main corporate facility is located
in Las Condes, where 6,750 m² are leased for the
executive offices in a central location of Santiago,
Chile. This space is distributed in seven floors along
one building.
Maintenance Base: The 162,500 m² maintenance
base is located on a site owned by LATAM group
inside Comodoro Arturo Merino Benítez International
Airport. This facility contains our aircraft hangar
(12,000 m²), warehouses (10,000 m²), workshops
(5,300 m²) and offices (11,000 m²), other spaces
(22,500m²), as well as a 98,000 m² aircraft parking
area capable of accommodating up to seventeen
short-haul aircraft. In addition, LATAM group leases
from Sociedad Concesionaria Nuevo Pudahuel S.A.
approximately 6,320 m² of space inside the Comodoro
Arturo Merino Benítez International Airport for
operational and service purposes.
Other Facilities: LATAM group owns 58,000 m² of
land and a building on the west side of the Comodoro
Arturo Merino Benítez International Airport that
houses a flight-training center. This facility features
three full-flight simulators (which are not property
of LATAM), one for Boeing 787 and two for Airbus
A320 aircraft. In addition, LATAM group has 388,000
m2 of unused land.
Fast Air Almacenes de Carga S.A., one of our affiliates
that operates import customs warehouses, uses a
10,500 m² warehouse located at Comodoro Arturo
Merino Benítez International Airport.
LATAM AIRLINES GROUP S.A.
RUT: 89.862.200-2
ADDRESS: SANTIAGO (CHILE)
TRADE NAMES: LATAM AIRLINES, LATAM
AIRLINES GROUP, LATAM GROUP, LAN
AIRLINES, LAN GROUP AND/OR LAN.
LATAM
GROUP
2024
› 212
12 / ANNEXES
Brazil
Headquarters: LATAM Airlines Brazil’s main facilities are
located in São Paulo, in hangars within the Congonhas
Airport and nearby. At Congonhas Airport, LATAM
Airlines Brazil leases office facilities in converted
hangars belonging to INFRAERO (the Local Airport
Administrator). These facilities comprise an area of
approximately 38,807 m2.
Headquarters of the Presidency: The Headquarters
of the Presidency and Service Academy is located
at Rua Atica, about 2.5 km from Congonhas Airport.
This property, which LATAM Airlines Brazil owns, is
used for human resources selection, medical services,
training, mock-ups and offices- The Service Academy
comprises 15,342 m2 of land area and 9,032 m2 of
building area.
Maintenance Base: The Maintenance, Repair, and
Overhaul (MRO) facility, located in the city of São
Carlos in the state of São Paulo, is one of LATAM
Airlines Brazil’s most important infrastructure assets.
The facility spans a total area of 120 hectares,
including a legal reserve and preservation area. Our
MRO has 97,500 m2 of built-up area, comprising eight
hangars, with the ongoing construction of Hangar
9, which will add an additional 5,000 m2, as well as
11,000 m2 of apron area.
In addition, LATAM Airlines Brazil operates at
Hangars II and V in Congonhas Airport, leased from
INFRAERO. This facility covers 23,886 m2 of offices
and hangars and accommodates approximately
1,300 workstations. It also serves as the base for
critical operations, including aircraft maintenance,
procurement, aeronautical materials logistics and
retrofitting departments.
Other Facilities: In São Paulo, LATAM Airlines Brazil
has other facilities, including a call center building
with 3,199 m2, distributed over five floors (plus
a ground floor and a basement) that currently
holds about 272 workstations and support rooms
(meetings / training / dining room / coordination)
of the operations of call center reservations, and
other ABSA back office services.
In Guarulhos, LATAM has a total area of approximately
12,649 m2 distributed within the passenger terminal,
including areas such as check-in, ticket sales, check-
out, operations areas, a VIP Lounge and aircraft
maintenance spaces. The Hangar Complex adds an
area of 65,080 m2. The cargo terminal has 252 m2 of
office and 17,215 m2 of open area. Our distribution
center supplies area occupies 3,030 m2.
New Facilities: LATAM Airlines Brazil completed
several infrastructure projects in Brazil during 2024,
including:
⚫ Improvements and adaptations at GRU Airport to
align with updated quality standards.
⚫ Continued progress on the project to modernize
visual communication across cargo terminals.
⚫ The launch of a project to adapt non-administrative
buildings and ensure compliance with accessibility
standards.
⚫ The implementation of a new cargo terminal in
Vitória da Conquista to support growing operational
demands.
⚫ The commencement of constructions for a state-
of-the-art maintenance hangar (Hangar 9) at the
São Carlos MRO facility.
⚫ The beginning of studies and project planning for
the reorganization and optimization of operational
areas at Congonhas Airport.
OTHER LOCATIONS
We occupy a 36.3-acre site at the Miami International
Airport that has been leased to us under a concession
agreement by the Miami Dade Aviation Department.
Our facilities include a 13,609 m² corporate building,
a 115,824 m² cargo warehouse (including 35,561
m² refrigerated area) and a 238,658 m² aircraft-
parking platform. These facilities were constructed
and are now leased to us under a long-term contract
by Aeroterm, a division of Realterm. For the year
ended 2024, we paid US$11.5 million in rent under
the foregoing leases.
In February 2014, the Company entered into a
lease agreement with Miami-Dade County covering
approximately 1.81 acres of land located on the
grounds of the Miami International Airport. The lease
has a term of 30 years with a total annual land cost
of US$239,671. Under the lease, we retained the
right to construct a hangar facility on the leased
premises.
The Company completed construction in November
2015 and the hangar has been operational since
June 2016. The property has a 15,479 m² aircraft
maintenance space, sufficient to house a Boeing 777
aircraft, in addition to a 9,888 m² area designated
for office space. Total investment in this hangar in
construction and related expenditures by LATAM
was US$16.5 million.
Additionally, LATAM Airlines Paraguay owns 2 hangars
at the Silvio Pettirossi Airport in the city of Asuncion
with a 37,535 m² area, currently not in use.
LATAM Airlines Peru is in the process of constructing
new airport facilities covering 4,000 m² and an
aircraft maintenance platform covering 65,000 m².
Both projects are being developed at the new Jorge
Chavez Airport in the city of Lima.
LATAM
GROUP
2024
12 / ANNEXES
Useful Life of Assets:
NCG 519: 4.1 TIME HORIZONS
Method used to estimate depreciation of Property, Plant and Equipment:
USEFUL LIFE (YEARS)
DEPRECIATION METHOD
MINIMUM
MAXIMUM
Buildings
Linear with no residual value
20
50
Plant and Equipment
Linear, with residual value of
20% in the short-range fleet and
36% in the long-haul fleet (*)
5
30
Information technology
equipment
Linear with no residual value
5
10
Fixed facilities and accessories
Linear with no residual value
10
10
Motor vehicles
Linear with no residual value
10
10
Leasehold improvements
Linear with no residual value
5
8
Right-of-use assets
Linear with no residual value
1
5
(*) Except for the Boeing 767-300ER, Boeing 777-300ER, Airbus A320 Family and Boeing 767-300F fleets, which have a lower residual value due to the
extension of their useful lives to 22, 23, 25 and 30 years, respectively. In addition, certain technical components are depreciated based on cycles and hours flown.
Note: See more in Financial Statements, Note 16 - PROPERTY, PLANT AND EQUIPMENT.
› 213
LATAM
GROUP
2024
LATAM
GROUP
2024
› 214
12 / ANNEXES
RESEARCH AND DEVELOPMENT, PATENTS
AND LICENSES, ETC.
NCG 519: 6.2.V, 6.2.VI AND 6.2.VII BUSINESSES
GRI 2-1
LATAM has been registered and/or renewed in
Argentina, Australia, Bolivia, Brazil, Canada, Chile,
China, Colombia, Costa Rica, Cuba, Dominican
Republic, Ecuador, El Salvador, the European Union,
Guatemala, Honduras, Hong Kong, India, Japan, Mexico,
Nicaragua, New Zealand, Panama, Paraguay, Peru,
South Korea, Taiwan, Uruguay, the United States,
United Kingdom and Venezuela.
LATAM AIRLINES has been registered and/or renewed
in Argentina, Bolivia, Brazil, Chile, China, Colombia,
Costa Rica, Cuba, Dominican Republic, Ecuador, El
Salvador, the European Union, Guatemala, Honduras,
India, Japan, Mexico, Nicaragua, Panama, Paraguay,
Peru, South Korea, Spain, Taiwan, United Kingdom,
Uruguay and Venezuela.
LATAM AIRLINES BRASIL has been registered and/or
renewed in Brazil; LATAM AIRLINES ARGENTINA has
been registered and/or renewed in Argentina; LATAM
AIRLINES COLOMBIA has been registered and/or
renewed in Colombia; LATAM AIRLINES ECUADOR
has been registered and/or renewed in Ecuador;
LATAM AIRLINES PARAGUAY has been registered
and/or renewed in Paraguay and LATAM AIRLINES
PERU has been registered and/or renewed in Peru.
LAN has been registered and/or renewed in Argentina,
Australia, Bolivia, Brazil, Chile, Colombia, Costa Rica,
Cuba, Dominican Republic, Ecuador, El Salvador, the
European Union, Guatemala, Honduras, Hong Kong,
India, Japan, Mexico, Nicaragua, New Zealand, Panama,
Paraguay, Peru, South Korea, Taiwan, Uruguay, the
United States, United Kingdom and Venezuela.
LAN AMERICA has been registered and/or renewed
in Bolivia; LAN BOLIVIA has been registered and/or
renewed in Bolivia; LAN CHILE has been registered
and/or renewed in Chile, Argentina, Paraguay, Peru,
United Kingdom, the European Union; LANPERU
has been registered and/or renewed in Costa Rica;
Paraguay, Venezuela; LAN PERU has been registered
and/or renewed in Brazil and Peru; TAM has been
registered and/or renewed in Argentina, Brazil, China,
Colombia, South Korea, Hong Kong, Macao, Mexico,
Paraguay, Peru, United Kingdom, the European Union,
Uruguay, the United States and Venezuela.
LANTAM GRUPO LATAM AIRLINES has been registered
and/or renewed in Ecuador. LATAM CORPORATE has
been registered and/or renewed in Argentina, Bolivia,
Colombia, Chile, Costa Rica, Ecuador, El Salvador,
Guatemala, Honduras, Mexico, Nicaragua, Panama,
Paraguay, Peru, Dominican Republic, the European
Union, United Kingdom and Uruguay.
LATAM LINEAS AEREAS has been registered and/
or renewed in Argentina, Chile, Colombia, Ecuador
and Peru; LATAM MRO has been registered and/or
renewed in Argentina; Bolivia, Brazil, Chile, Colombia,
Ecuador, Mexico, Paraguay, Peru, the European
Union, United Kingdom, Uruguay, the United States
and Venezuela.
LATAM CARGO has been registered and/or renewed
and/or renewed in Argentina, Bolivia, Brazil, Chile,
Colombia, Ecuador, Mexico, Paraguay, Peru, the
European Union, United Kingdom, Uruguay, the United
States and Venezuela; LATAM CARGO BRASIL has been
registered and/or renewed in Brazil; LATAM CARGO
COLOMBIA has been registered and/or renewed in
Colombia; LINEA AEREA CARGUERA DE COLOMBIA
has been registered and/or renewed in Colombia;
LATAM CARGO MEXICO has been registered and/or
renewed in Mexico; LAN CARGO MEXICO has been
registered and/or renewed in Mexico; ABSA has been
registered and/or renewed in Chile; LAN CARGO
COLOMBIA has been registered and/or renewed in
Colombia; LAN ECUADOR has been registered and/
or renewed in Ecuador, United Kingdom and the
European Union; TAM CARGO been renewed in Brazil
and Venezuela; TAM CARGO CONVENCIONAL has
been registered and/or renewed in Brazil.
LATAM CARGO GROUP has been registered and/or
renewed in Argentina, Colombia, Costa Rica, Ecuador,
Guatemala, Mexico, Paraguay, Peru, Uruguay, Australia,
Brazil, Canada, China, the European Union, India,
United Kingdom and the United States.
LATAM CARGO ACERCANDO OPORTUNIDADES has
been registered and/or renewed in Peru; ACERCANDO
OPORTUNIDADES has been registered and/or renewed
in Ecuador and Colombia; LATAM CARGO BRINGING
OPPORTUNITIES CLOSER has been registered and/
or renewed in the United States; LATAM CARGO
APROXIMANDO OPORTUNIDADES has been registered
and/or renewed in Brazil; CHILLCARGO has been
registered and/or renewed in Chile.
LATAM FIDELIDADE has been registered and/or
renewed in Argentina, Australia, Brazil, Chile, Colombia,
Ecuador, Mexico, New Zealand, Paraguay, Peru, the
European Union, United Kingdom, Uruguay and
the United States; FIDELIDAD has been registered
and/or renewed in Argentina; FIDELIDADE has been
registered and/or renewed in Argentina and Brazil.
LATAM PASS has been registered and/or renewed in
Argentina, Australia, Bolivia, Brazil, Chile, Canada,
Colombia, Ecuador, Mexico, New Zealand, Paraguay,
Peru, the European Union, United Kingdom, Uruguay,
the United States and Venezuela; LATAM PASS MILES
has been registered and/or renewed in New Zealand
and Australia; LAN PASS has been registered and/or
renewed in Chile, Argentina, Brazil, Colombia, Mexico
and Uruguay; LATAM TOURS has been registered
and/or renewed in Argentina, Chile, Colombia,
Ecuador and Peru; LATAM TRADE has been registered
and/or renewed in Argentina, Bolivia, Brazil, Chile,
Colombia, Costa Rica, Ecuador, El Salvador, Guatemala,
Honduras, Mexico, Nicaragua, Panama, Paraguay,
Peru, Dominican Republic, the European Union,
United Kingdom and Uruguay; LATAM TRAVEL has
been registered and/or renewed in Argentina, Bolivia,
Brazil, Chile, Colombia, Ecuador, Mexico, Paraguay,
Peru, the European Union, United Kingdom, Uruguay,
the United States and Venezuela; LATAM TRAVEL
SOLUTIONS has been registered and/or renewed
in Panama; LATAM VIAGENS has been registered
and/or renewed in Brazil; TAM VIAGENS has been
renewed in Brazil and Venezuela; TAM VACATIONS
has been renewed in Argentina and Brazil; DESTINOS
LANTOURS has been registered and/or renewed in
Peru.
LATAM, JUNTOS MÁS LEJOS has been registered
and/or renewed in Argentina, Chile, and Ecuador;
LATAM, TOGETHER, FURTHER has been registered
and/or renewed in Australia, New Zealand, United
Kingdom and the European Union.
LATAMPLAY has been registered and/or renewed
LATAM
GROUP
2024
› 215
12 / ANNEXES
in Argentina, Brazil, Chile, Colombia and Ecuador;
LATIN AIRLINE NETWORK has been registered
and/or renewed in Chile; LIBREVOLADOR has been
registered and/or renewed in Bolivia, Chile, Ecuador,
Paraguay and Peru; LIBREVOLADORES has been
registered and/or renewed in Bolivia, Chile, Ecuador,
Paraguay and Peru; LIDERES DEL SERVICIO has been
registered and/or renewed in Argentina.
LATAM AIRLINES, SANS FRONTIÈRES has been
registered and/or renewed in France; LATAM AIRLINES,
GRENZENLOS has been registered and/or renewed
in Germany; LATAM AIRLINES, SIN FRONTERAS has
been registered and/or renewed in Spain; LATAM, SIN
FRONTERAS has been registered and/or renewed in
Argentina, Bolivia, Chile, Colombia, Costa Rica, Cuba,
Ecuador, El Salvador, Guatemala, Honduras, Mexico,
Nicaragua, Panama, Paraguay, Peru, Dominican
Republic, Uruguay and Venezuela. LATAM AIRLINES,
SENZA FRONTIERE has been registered and/or
renewed in Italy.
LATAM, SOSTENIBILIDAD: UN DESTINO NECESARIO
has been registered and/or renewed in the European
Union; LATAM UN DESTINO NECESARIO has been
registered and/or renewed in Argentina, Chile, Colombia,
Ecuador, Mexico and Peru; LATAM A NECESSARY
DESTINATION has been registered and/or renewed
in United Kingdom and the United States; LATAM
DESTINADAS A ESTAR JUNTAS has been registered
and/or renewed in Colombia and Peru.
LATAM VUELA NEUTRAL has been registered and/
or renewed in Bolivia, Colombia, Mexico, Peru, the
European Union and Uruguay; SOSELVA has been
registered and/or renewed in Peru; POSITIVE FS
POSITIVE FLIGHT SPECIFIC has been registered and/
or renewed in Canada.
LATAM RECICLE SUA VIAGEM has been registered
and/or renewed in Brazil and the European Union;
LATAM RECICLA TU VIAJE has been registered and/
or renewed in Argentina, Bolivia, Chile, Colombia,
Ecuador, Mexico, Peru, the European Union, Paraguay
and Uruguay.
LATAM 1+1 COMPENSAR PARA CONSERVAR has been
registered and/or renewed in Argentina, Brazil, Chile,
Ecuador, Mexico and the European Union. LATAM 1+1
OFFSET TO CONSERVE has been registered and/or
renewed in Australia, Canada, United Kingdom, New
Zealand and the United States. LATAM SEGUNDO
VUELO has been registered and/or renewed in
Argentina, Bolivia, Chile, Colombia, Ecuador, Mexico,
Paraguay, Peru, the European Union and Uruguay;
LATAM SECOND FLIGHT has been registered and/or
renewed in Australia, United Kingdom, the United
States, Canada and New Zealand.
LATAM AVIÓN SOLIDARIO has been registered and/
or renewed in Argentina, Bolivia, Chile, Colombia,
Ecuador, the European Union, Mexico, Peru, Paraguay
and Uruguay; LATAM AVIÃO SOLIDÁRIO has been
registered and/or renewed in Brazil.
VOLAMOS POR TI has been registered and/or renewed
Colombia; EN LATAM VOLAMOS POR TI has been
registered and/or renewed Colombia.
CYBER LATAM has been registered and/or renewed
in Chile.
TAM has filed for trademark registration, registered
or renewed the following trademarks in Brazil: AJATO,
BUSINESS CLASSIC, BUSINESS PLUS, CLASSIC
FIDELIDADE, FIRST, LATAM, LATAM 1+1 COMPENSAR
PARA CONSERVAR, LATAM AIRLINES, LATAM AIRLINES
BRASIL, LATAM AVIÃO SOLIDÁRIO, LATAM CARGO,
LATAM CARGO APROXIMANDO OPORTUNIDADES,
LATAM CARGO BRASIL, LATAM DESTINADAS A
ESTAREM JUNTAS, LATAM FIDELIDADE, LATAM LINHAS
AÉREAS, LATAM MRO, LATAM PASS, LATAM RECICLE
SUA VIAGEM, LATAM SEGUNDO VOO, LATAM SEM
FRONTEIRAS, LATAM SEXTAS COMPENSAM, LATAM
TRADE, LATAM TRAVEL, LATAM VIAGENS, LATAM
WALLET, LATAMPLAY, LOGO ASOCIADO A MARCA
LATAM, MAX, MEGA PROMO, MERCADO LATAM,
MUSEU TAM, PAIXÃO PELO RIO TAM, PROMO, RED
REPORT, RELAX, TAM, TAM AIRLINES, TAM BUSCA
PREÇO, TAM CARGO, TAM CARGO CONVENCIONAL,
TAM CARGO PRÓXIMO DIA, TAM CARGO PRÓXIMO
VÔO, TAM ESPAÇO +, TAM ESPAÇO MAIS, TAM
EXPRESS, TAM MILOR, TAM PREMIUM BUSINESS,
TAM PREMIUM ECONOMY, TAM SEARCH BY PRICE,
TAM TARIFA LIGHT, TAM TARIFA MAX, TAM TARIFA
PROMO, TAM TARIFA TOP, TAM VACATIONS, TAM
VIAGENS, UM DESTINO NECESSÁRIO, VAMOS LATAM.
INSURANCE
NCG 519: 6.2 BUSINESSES
Aviation Insurance
The LATAM group has Aviation Insurance that includes
hull and liability coverage, ensuring protection against
the risks inherent to aviation operations. This policy
provides coverage for damages to aircraft, engines,
and parts, while also including third-party liability,
such as passengers and cargo.
This insurance is managed in collaboration with the
IAG Group, which includes British Airways, Iberia,
and their subsidiaries and franchisees. As a result,
the increase in negotiated volumes has allowed for
improved coverage and access to more competitive
conditions in terms of costs.
General Insurance
Additionally, the LATAM group has general insurance
policies that cover various risks that could impact its
assets and equity. In this context, it has a multi-risk
coverage plan designed to protect against damages
and losses resulting from fires, natural disasters,
theft, and other incidents.
Automotive and Liability Insurance
The LATAM group also has automotive and liability
insurance, further strengthening its protection against
potential contingencies. Moreover, to safeguard the
well-being of its team, the company provides life,
supplementary health, and accident insurance for
its personnel.
LATAM
GROUP
2024
› 216
12 / ANNEXES
CORPORATE GOVERNANCE
Shareholders’ Agreement
On or around the "Effective Date” of LATAM group's
emergence from bankruptcy proceedings in the United
States, in accordance with the terms and conditions
of the "Reorganization Plan” that was approved and
confirmed on June 18, 2022 by the Bankruptcy Court
in said reorganization proceeding, the Backstop
Creditors and the Backstop Stockholders of said
Reorganization Plan entered into a Shareholders'
Agreement that provides, among other things, that:
⚫ For a two-year term following the Effective Date,
the parties to the Shareholders’ Agreement shall vote
their shares so that the LATAM Airlines Group Board
of Directors will comprise, both initially and in the
filling of any vacancies thereon, nine directors, who
in accordance with Chilean law, shall be appointed
as follows:
- Five directors, including the vice-chair of
the LATAM Airlines Group Board of Directors,
nominated by the Backstop Creditors; and
- Four directors, including the chair of the LATAM
Airlines Group Board of Directors (who shall be
a Chilean national), nominated by the Backstop
Shareholders.
⚫ During the first five years after the Effective Date,
in the event of a wind-down liquidation or dissolution
of LATAM Airlines Group S.A., recoveries on the
shares delivered in exchange for the New Convertible
Notes Class B to the extent the conversion option
thereunder is exercised, shall be subordinated to any
right of recovery for any shares delivered or to be
delivered upon conversion of the New Convertible
Notes Class A or New Convertible Notes Class C,
in each case held by the Backstop Creditors on the
Effective Date.
VOTING AGREEMENTS, TRANSFERS AND
OTHER ARRANGEMENTS
Voting Agreements
The parties to the Holdco I shareholder’s agreement
and TAM shareholders agreement have agreed to vote
their voting shares of Holdco I and shares of TAM
so as to give effect to the agreements with respect
to representation on the TAM board of directors
discussed above.
Transfer Restrictions
As provided in the aforementioned shareholders’
agreements, TEP Chile S.A. (“TEP Chile”) may sell
all voting shares of Holdco I beneficially owned by it
as a block, subject to satisfaction of the block sale
provisions, if a release event (as described below)
occurs. A “release event” will occur if (i) a capital
increase of LATAM Airlines Group occurs, (ii) TEP
Chile does not fully exercise the preemptive rights
granted to it under applicable law in Chile with
respect to such capital increase in respect of all of
its restricted LATAM Airlines Group common shares,
and (iii) after such capital increase is completed, the
individual designated by TEP Chile for election to
the board of directors of LATAM Airlines Group with
the assistance of the Cueto Group is not elected to
the board of directors of LATAM Airlines Group. As
a result of the implementation of the restructuring
set forth in our Plan of Reorganization, a “release
event” occurred. However, no sale of the voting
shares of Holdco I beneficially owned by TEP Chile
has been implemented.
Restriction on transfer of TAM shares
LATAM agreed in the Holdco I shareholders’ agreement
not to sell or transfer any shares of TAM stock to
any person (other than our affiliates) at any time
when TEP Chile owns any voting shares of Holdco
I. However, LATAM will have the right to effect such
a sale or transfer if, at the same time as such sale
or transfer, LATAM (or its assignee) acquires all the
voting shares of Holdco I beneficially owned by TEP
Chile for an amount equal to TEP Chile’s then current
tax basis in such shares and any costs TEP Chile
is required to incur to effect such sale or transfer.
TEP Chile has irrevocably granted us the assignable
right to purchase all of the voting shares of Holdco I
beneficially owned by TEP Chile in connection with
any such sale.
Conversion Option
Pursuant to the Holdco I shareholders’ agreement, we
have the unilateral right to convert our shares of non-
voting stock of Holdco I into shares of voting stock of
Holdco I to the maximum extent allowed under law
and to increase our representation on the TAM and
Holdco I boards of directors if and when permitted in
accordance with foreign ownership control laws in Brazil
and other applicable laws if the conversion would not
have an adverse effect (as defined above under the
“-Transfer Restrictions” section). In February 2019,
we completed the procedures for the exchange of
shares of Holdco I S.A., through which LATAM Airlines
Group SA increased its indirect participation in TAM
S.A., from 48.99% to 51.04%. This transaction was
undertaken pursuant to the Provisional Measure No.
863/2018 issued by CADE on December 13, 2018,
through which the participation of up to 100% of
foreign capital in airlines in Brazil is permitted.
If we can purchase and/or convert our shares and we
do not timely exercise our right to do so, then the
controlling shareholders of TAM will have the right
to put their shares of voting stock of Holdco I to us
for an amount equal to the sale consideration.
Acquisitions of TAM Stock
The parties have agreed that all acquisitions of TAM
common shares by LATAM Airlines Group, Holdco
I, TAM or any of their respective subsidiaries from
and after the effective time of the merger will be
made by Holdco I.
LATAM
GROUP
2024
› 217
12 / ANNEXES
ANNUAL MANAGEMENT REPORT OF THE
COMMITTEE OF DIRECTORS
NCG 519: 3.3 BOARD COMMITTEES AND 10. COMMENTS FROM
SHAREHOLDERS AND THE DIRECTORS’ COMMITTEE
I. INTEGRATION OF THE COMMITTEE OF DIRECTORS
As of May 2, 2024, the Company's Directors' Committee
is composed of Frederico Curado, Sonia J.S. Villalobos
and Michael Neruda, with only the former, who is
also the Chair of the Directors' Committee, having
an independent director status under Chilean law.
The directors were elected at the Ordinary Shareholders'
Meeting held on April 25, 2024 for a term of two
years, in accordance with the provisions of the
Company's bylaws.
II. REPORT OF COMMITTEE ACTIVITIES
During fiscal year 2024, the Committee of Directors
met on 16 occasions, in order to exercise its faculties
and fulfill its duties in accordance with article 50
Bis of Law number 18,046 on Corporations, as well
as review or evaluate those other matters that the
Committee of Directors deemed necessary.
The main topics discussed are reported below.
Review of balance sheet and financial statements
The Committee of Directors examined and reviewed
the financial statements of the Company as of
December 31, 2023, as well as at the closing of the
quarters ended March 31, June 30 and September 30,
2024, in the extraordinary meeting of February 22
and ordinary sessions of January 18, May 2, August
7, November 6, and December 3 2024, respectively,
including the reports of the Company's External
Auditors, PriceWaterhouseCoopers Consultores
Auditores Compañía Limitada ("PwC"), who participated
in all sessions.
Review of impairment reports
In the sessions held on February 22, May 2, August 7
and November 6, 2024, the Committee of Directors
discussed issues related to the analysis of indications
of impairment regarding certain assets included in
the financial statements of the cash-generating unit
Transporte Aéreo. The impairment test results were
discussed as of December 31, 2023, as well as the
analysis of signs of impairment as of March 31, June
30, 2024 and September 30, concluding that there
are no signs of deterioration that warrant the need
for the Company to carry out additional tests on
that date, nor to carry out an accounting adjustment
of assets on the date of the test.
Compensation systems for executives and workers
In the sessions of May 2 and December 20, 2024, the
Committee examined the current remuneration policies
and systems and the update of the compensation
plans for the main executives and workers of the
Company, including the Corporate Incentives Program
(CIP).
Internal Audit
In the session held on January 18, the 2024 Internal
Audit Plan was approved, as well as the closing of
the 2023 Plan. In the sessions held on March 6, April
2, May 2, June 5, August 7, September 3, October 1,
November 6 and December 3, 2024, the status of
the Internal Audit plan carried out during the year
2024 was reviewed, highlighting the main projects
that were addressed, the relevant aspects of the
audits that were executed and the status of the
internal controls.
Audits under SOX regulations
In the sessions of the Committee of Directors on
January 18 and February 22, the results obtained
in the SOX certification during the year 2023 were
presented, in the context of the approval of the
2023 financial statements. In the sessions held on
April 2, June 5, August 7, September 3, October 1,
November 6 and December 3, 2024, the planning to
be followed in terms of SOX regulations for the 2024
certification was presented. It was also informed, in
the sessions held on February 22 and March 6, about
the most relevant matters to be considered during
2024, the Company's projects that could impact SOX
regulations, and a timeline to be followed regarding
this certification throughout 2024.
External Audit Services
In the session dated February 22, 2024, PwC presented
the 2023 external audit report. In the session dated
March 6, 2024, the performance evaluation of the
external auditors, was carried out. In the session held
on May 2, 2024, PwC presented the External Audit
Integrated Plan for the year 2024, addressing topics
related to the regulatory requirements regarding
communication and work deliverables, the composition
of the PwC team, the consolidated audit approach,
the progress made during the year in the internal
control review and the schedule of activities and
communications that will be maintained with the
Committee members. In the sessions held on August
7 and November 6 2024, PwC presented the status
if the Plan, including the internal control tests.
Corporate Risk Management
Throughout the year, the Directors' Committee
reviewed in different sessions the corporate risks that
have been considered most relevant. In this context,
in the sessions held on March 6 and September 3,
risks related to cybersecurity were reviewed; In the
session held on April 2, the implementation of the
fraud risk mitigation plan was reviewed; In the sessions
dated August 7 and December 3, risks related to
tax issues were reviewed and in the sessions dated
September 3 and October 1, risks associated with
sustainability were reviewed.
Likewise, the Directors' Committee reviewed on
June 5, 2024, corporate risks, including prevention,
the risk model and its status. Likewise, in particular
reviews are carried out of the main risks of the
different territories in which the group operates.
In this context, in the session on May 2, the status
of the subsidiary LATAM Airlines Colombia was
presented, on October 1, the cargo business and
the territory of the United States were presented
to the Committee, and on December 3, the status
of LATAM Brazil was presented, identifying the risks
associated with each of these businesses and the
initiatives that have been implemented to mitigate
them.
LATAM
GROUP
2024
› 218
12 / ANNEXES
Compliance
The Directors' Committee, in the sessions of
February 22, March 6, September 3, October 1 and
December 3, 2024, received the semiannual reports
and training on Compliance, reviewing, among other
matters, the current Compliance Program and its
main contents, among which the commitment of
senior management, the most relevant standards
and laws, the development of policies, training
and communications, the status of the Third Party
Intermediaries (“TPIs”), the identification and
management of risks of Compliance, the report of
Compliance at the corporate level, among others.
LATAM Policies
In the session held on February 22, the Code of
Conduct of LATAM was reviewed. In the ordinary
session held on August 7, 2024, General Standard
No. 501 issued by the Financial Market Commission
was reviewed, which establishes the minimum
mentions of the Regular Operations Policies and
regulates the public dissemination of operations
with related parties, and the updates required by
the Company's policies, related to (i) in the matter of
habitual operations, the regulation requires adding
information regarding the transactions that the Board
of Directors defines as habitual, counterparty of the
operation and maximum amounts to be considered;
and (ii) in terms of reporting on operations with
related parties, a semiannual report must be prepared
and disseminated on the operations with related
parties actually carried out by the company during
the previous semester. The Committee agreed to
recommend to the Board of Directors the approval
of the updates to the Regular Operations Policy and
Related Party Operations Policy, along with their
publication, for the purposes of complying with the
aforementioned regulations.
In the ordinary session held on September 3, 2024,
the updates to the Corporate Crime Prevention Policy
were reviewed, due to the recent entry into force in
Chile of the new Economic Crimes Law.
In the ordinary session of December 3, 2024, the
process of preparing, reviewing and approving existing
policies was reviewed and updates to existing and new
policies were analyzed, among which the Recovery
Policy for Erroneously Awarded Compensations
(Clawback) stands out.
Examination of reports related to the Related
Party Transactions Policy (“RPT”)
In the Committee sessions held on May 2 and
November 6, 2024, in compliance with the reporting
obligation established in the Company's current
RPO Policy, management informed the Committee
of Directors about: (i) the usual operations carried
out by the LATAM Group with those subsidiaries in
which its participation is less than 95%, (ii) the main
operations carried out between companies of the
LATAM Group in general, and (iii) those operations
revealed in the note to the financial statements on
transactions with related parties.
Recommendations of the Committee of Directors
On the other hand, the Committee of Directors
made the recommendations indicated below, on the
occasion of the appointment of External Auditors
of the Company, Private Risk Rating Agencies for
the year 2024, in addition to other matters related
to their role.
ACTIVITIES REPORT PER SESSION OF THE
COMMITTEE OF DIRECTORS
NCG 519: 3.3.IV COMITÉS DEL DIRECTORIO
The Committee of Directors met and held sessions
on sixteen occasions, with the participation of its
three members in each of these sessions, which are
detailed below, with a brief list of the main subjects
examined in each of the sessions:
1. Ordinary Session N°250 01/18/2024
⚫ Update and Closing Processes of Financial
Statements and SOX Certification
● Internal Audit Work Plan 2024
● Closing Work Plan 2023 Internal Audit
● Results Goals Internal Audit 2023
● Directors Committee Agenda 2024
2. Extraordinary Session N°192 02/22/2024
● Impairment Test Approval as of December 31,
2023
● Review of the Closing Process of the Financial
Statements as of December 31, 2023
● External Auditor Report
● LATAM Code of Conduct Update
● Appointment of Financial Expert
3. Ordinary Session N°251 06/03/2024
● Performance Evaluation of the External Auditor
● Proposal of Risk Classification Firms for Fiscal
Year 2024
● Cybersecurity Status
● Compliance Program Update
● Annual Management Report of the Committee
of Directors
● Internal Audit work plan update
● Executive Session - CEO Reserved Slot
● Executive Session - VP Legal & Compliance
Reserved Slot
4. Ordinary Session N°252 04/02/2024
● Fraud Management Model Implementation
Status
●Review Estimates and Relevant Accounting
Policies
● Status and Progress of the Internal Audit and
SOX 2024 Work Plan
● Audit Management Goals 2024
5. Ordinary Session N°253 05/02/2024
● Remuneration System and Compensation
Plans for Company Executives and Workers
● Review Topics LATAM Airlines Colombia
● LATAM Cargo Investigation Update
● Review and Approval of Financial Statements
for the First Quarter 2024
● External Audit Plan 2024 PwC
● Transaction with Related Parties
● Executive Session - CFO Reserved Slot
● Executive Session - Reserved Slot Internal
Auditor LATAM
● Financial and Corporate Issues Update
6. Ordinary Session N°254 06/05/2024
● Corporate Risk Status
LATAM
GROUP
2024
› 219
12 / ANNEXES
● Fuel Project Status Review
● Identity & Access Management Project Status
Review
● Advance Audit Plan 2024 and SOX
7. Extraordinary Session No. 193 07/02/2024
● Update Process of Reopening and Relisting of
the Company's American Depositary Receipts
(ADRS) Program Presentation
8.Extraordinary Session N°194 07/15/2024
● Update on the Reopening and Relisting Process
of the ADR Program and Potential Secondary Sale
of Shares
● Review and Recommendation for Publishing
and Sharing Flash Numbers Second Quarter
● Essential Fact Revolving Credit Facility (RCF)
9.Extraordinary Session No. 195 07/17/2024
● Relisting ADR Program Update
10.Ordinary Session N°255 07/24/2024
● Secondary Sale of Shares
11.Ordinary Session N°256 08/07/2024
● Review and Approval of Financial Statements
for the Second Quarter of 2024
● Tax Issues Update
●General Rule No. 501 of the Financial Market
Commission.
● Corporate Structure
● 2024 Audit Plan Update
● Roles and Responsibilities between the Audit
Committee and the Directors' Committee.
● Executive Session - Reserved Slot External
Auditor
12.Ordinary Session N°257 09/03/2024
● Cybersecurity Status - Mandiant Presentation
● Update of Corporate Crime Prevention Policy
● Sustainability Risk Update
● Audit Plan Update
● External Auditor Update (PCAOB)
13.Ordinary Session N°258 01/10/2024
● Cargo Business Status and United States
● Fraud Management Desk Status
● Sustainability Risk Update
● Compliance Topics Update
● Audit Plan Update
● Executive Session - CEO Reserved Slot
● Executive Session - Reserved Slot VP Legal &
Compliance
14.Ordinary Session N°259 06/11/2024
● Review and Approval of the Financial
Statements for the Third Quarter of 2024
● Review of Estimates and Relevant Accounting
Policies
● Proposed Report regarding General Standard
Report No. 501 of the Financial Market
Commission
●Audit Plan and SOX Update
15. Ordinary Session No. 260 03/12/2024
● Review Topics LATAM Airlines Brazil
● Tax Issues Update
● CalendarFinancial Statements Closing and 20F
Report
● External Audit and SOX Certification Status
● Executive Session - Reserved Slot External
Auditor
● Fuel Project Status
● Compliance Policies Update
16. Extraordinary Session No. 196
12/20/2024
● Incentive Plan Update
III. DIRECTORS’ COMMITTEE COMPENSATION
AND SPENDING.
GRI-19
NCG 519: 3.3 BOARD OF DIRECTORS COMMITTEES
The Ordinary Shareholders' Meeting of the Company,
held on April 25, 2024, agreed for financial year 2024
and until the next Ordinary Shareholders' Meeting
to be held in 2025:
(i) As base remuneration for each Director member
of the Directors Committee, a fixed annual fee of
US$50,000 and US$85,417 for the President of
the Directors Committee, payable regardless of
the number of sessions the Directors Committee
attended, without limit of sessions.
(ii) For additional remuneration for each Director
member of the Committee of Directors, a variable
amount, equivalent to an additional third (1/3)
calculated on the incremental remuneration that the
respective member of the Committee is entitled to
as Director, considering the time that each one has
served in the position of member of the Committee
of Directors.
Directors Michael Neruda, Bornah Moghbel, William de
Wulf and Bouk van Geloven waived their compensation
as members of the Board of Directors, the Audit
Committee and subcommittees.
For the functioning of the Committee of Directors
and its advisors, Law number 18,046 on Corporations
establishes that its expense budget must be at least
equal to the sum of the annual remunerations of
the members of the Committee. In this sense, the
Ordinary Shareholders' Meeting held on April 25,
2024, approved an annual expense budget for the
committee of US$185,417 for Fiscal Year 2024 and
until the next Ordinary Shareholders' Meeting to be
held in 2025. During 2024, this expense budget was
not used.
LATAM
GROUP
2024
› 220
12 / ANNEXES
IV. RECOMMENDATIONS OF THE DIRECTORS’
COMMITTEE.
NCG 519: 3.3.IV COMITÉS DEL DIRECTORIO Y 11.
COMENTARIOS DE ACCIONISTAS Y DEL COMITÉ DE
DIRECTORES
IV.1 Proposal for the Appointment of External
Auditors.
In the session of the Directors’ Committee on March
6, 2024 and in accordance with the provisions of
number 2) of the eighth paragraph of article 50
bis of Law number 18,046 on Corporations, it is
agreed to propose to the Board of Directors of the
Company, based on the analysis carried out by the
administration regarding the technical and economic
evaluation of the tender for this service carried out
in 2023 and the work and performance evaluation
of the audit work of the previous year, continue with
the external auditors PwC for fiscal year 2024. The
previous proposal was approved by the Company's
Shareholders' Meeting held on April 25, 2024.
IV.2 Proposal for Private Risk Rating Agencies.
The Committee of Directors in the session of March
6, 2024 and in accordance with the provisions of
paragraph 2) of the eighth paragraph of article 50
bis of Law number 18,046 on Corporations, agreed
to propose to the Board of Directors the Risk Rating
Agencies to submit for approval to the Ordinary
Shareholders' Meeting of the Company on April
25, 2024. In this sense, the Committee resolved
to propose to the Company's Board of Directors
the appointment of the following local Risk Rating
firms: the appointment of the firms Fitch Chile Risk
Rating Limited and Feller-Rate Risk Rating Limited.
Regarding the international risk classification, the
designation of the firms Fitch Ratings Inc., Moody's
Investors Service and Standard & Poor's Ratings
Services.
IV.3 Other recommendations:
In addition to the recommendations indicated above
and as part of its usual management, the Committee
of Directors recommended to the Board of Directors,
among other topics, the approval of the Quarterly
Financial Statements for March, June and September;
the adoption of new corporate policies and updates
thereof; approve the Incentive Plan for executives
and employees of the Company (CIP).
IV.4 Audit Committee:
On July 17, 2024, the Board of Directors created the
Audit Committee, for the purposes of complying with
the regulations of the United States of America. This
Audit Committee is a different committee from the
Directors' Committee required under article 50 bis of
Law No. 18,046. The Audit Committee is made up of
Mr. Frederico Curado and Mrs. Sonia J.S. Villalobos.
The main functions of the Audit Committee are; i)
Supervision of Financial Information and Accounting
Reports, ii) Supervision of the External Audit, iii)
Supervision of the Internal Control System, iv)
Supervision of Regulatory and Ethical Compliance,
and finally, v) Supervision of the Internal Audit and
Risk Management.
COMMENTS AND PROPOSALS ON BUSINESS
PERFORMANCE
NCG 519: 11. COMMITMENTS FROM SHAREHOLDERS AND THE
BOARD OF DIRECTORS
With regard to the third paragraph of Article 74 of
Law No. 18.046, it is worth mentioning that there
were no comments or proposals from the Directors’
Committee or shareholders of 10% or more of the
LATAM Airlines Group S.A. voting shares concerning
the performance of the company’s business.
NEW ANNUAL COMPENSATION STRUCTURE
FOR THE BOARD OF DIRECTORS FOR THE
2024 FISCAL YEAREJERCICIO 2024
NCG 519: 3.2.II BOARD OF DIRECTORS
On April 25, 2024, the ordinary shareholders’ meeting
approved the new annual remuneration structure
of the Board, for the fiscal year 2024 and until the
next ordinary shareholders’ meeting scheduled to
take place in the first four months of 2025. On such
meeting, the shareholders agreed on a fixed annual
compensation of US$80,000 for each board member
(US$160,000 in the case of the chairman). The
aforementioned remuneration is payable monthly at
the rate of one-twelfth of the corresponding amount,
regardless of the number of board meetings directors
attend, without limit of sessions.In addition to the
base remuneration, an additional remuneration
was approved for each Board member within the
shareholders’ meeting held on April 25, 2024, to be
determined based on the following criteria:
From November 16, 2023 through November 15,
2024, each Board member was entitled to receive
an additional remuneration equivalent to 9,226,234
units of remuneration or “URAs”, provided that the
director served continuously as a member of the
Board until the end of such period.
From November 16, 2024 through the date of the
next ordinary shareholders’ meeting scheduled to
take place in the first four months of 2025, each
Board member will be entitled to receive another
additional amount equivalent to 3,844,264 URAs,
provided that the director serves continuously as a
member of the Board until the end of such period.
Additionally, members of the Board that are also
members of the Board of Directors’ Committee are
entitled to certain fixed and variable compensation
(see “Board of Directors’ Committee and Audit
Committee” below).
If a member of the Board of Directors ceases to hold
his/her position before November 15, 2024 (other
than due to a legal inability to perform as a director
of the company, or due to a supervening conflict
of interest or other cause that doesn’t allow him/
her to continue exercising his/her fiduciary duties
as a director) such director would be entitled to a
pro rata portion of the URAs referred to in letter
a. above, and would lose the right to receive the
remainder. By the same token, if a member of the
Board of Directors ceases to hold his/her position
after November 15, 2024 but before the date of the
next ordinary shareholders’ meeting scheduled to
take place in the first four months of 2025 (other
than due to a legal inability to perform as a director
of the company, or due to a supervening conflict
LATAM
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12 / ANNEXES
of interest or other cause that doesn’t allow him/
her to continue exercising his/her fiduciary duties
as a director) such member would maintain the
right to receive the URAs referred to in letter a.
above, would be entitled to a pro rata portion of
the URAs referred to in letter b. above, and would
lose the right to receive the reminder. For the sole
purpose of calculating the said pro rata portion of
the URAs referred to in letter b. above, the ordinary
shareholders’ meeting corresponding to 2025 shall
be considered to take place on April 15, 2025.
In the event of a change of control of the Company,
the director who maintains his/her status on the date
the change of control occurs is entitled to receive
the URAs referred to in letters a. and b. above. In
the event the composition of the Board of Directors
changes, each new director will be entitled to the
variable compensation described above on a pro rata
basis based on the months in which such director
would held office, and each exiting director will be
paid such compensation on a pro rata basis for the
time that such director held his/her position in the
respective period.
Each URA will be measured against the value of a
share of LATAM Airlines Group, and will be payable
considering the weighted average price of the shares
of the Company during the 10 stock-exchange-
business-days prior to their respective accrual
date (i.e., November 15, 2024, the date of the next
ordinary shareholders’ meeting scheduled to take
place in the first four months of 2025, the date in
which the member of the Board of Directors ceased
to be in its position, as applicable). The transactions
in the Chilean stock exchanges and non-Chilean
stock exchanges (including NYSE) will be taken into
consideration for purposes of determining such
weighted average price.
The amounts paid during 2024 as variable compensation
as per letters (a), (b) and (c) above are:
US$
THOUSAND
URAs Directors
763
URAs Board Committee
85
Total
848
Board Members Michael Neruda, Bornah Moghbel
and William de Wulf, as well as former Member
Bouk Van Geloven, waived their compensation as
members of the Board of Directors, of the Directors’
Committee and of the subcommittees.
LATAM
GROUP
2024
12 / ANNEXES
POLITICAL INFLUENCE
GRI 415-1
LATAM group monetary contributions
US$
2021
2022
2023
2024
Lobbying, interest representation or similar
0
0
0
0
Local, regional or national political campaigns, organizations,
candidates
0
0
0
0
Trade associations, guilds, tax-exempt associations or groups
(e.g., think tanks)
1,044,795
1,402,306
1,829,742
1,545,987
Others
0
0
0
0
Total contributions and other expenses
1,044,795
1,402,306
1,829,742
1,545,987
Data coverage
100%
100%
100%
100%
› 222
LATAM
GROUP
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12 / ANNEXES
Greater monetary contributions to organizations
NNAME OF THE ORGANIZATION
DESCRIPTION OF THE ORGANIZATION
SUM PAID IN 2024
Asociación Brasileña de Aerolíneas (ABEAR)
The mission of the Brazilian Association of Airlines (ABEAR) is to encourage the habit of flying in Brazil, promoting the continuous and sustainable growth of civil aviation in the country. Its operating
strategies include the planning, implementation and support of actions and programs designed to promote both passenger and cargo transportation.
Founded in 2012 by the main Brazilian airlines, such as AVIANCA, AZUL, GOL, TAM (currently LATAM) and TRIP, the association also aims to strengthen relationships within the aviation chain,
working closely with the public and private sectors, professional associations and consumers, to ensure a harmonious and efficient development of the airline industry in Brazil.
US$909,733
Asociación Latinoamericana y del Caribe de
Transporte Aéreo (ALTA Brasil)
The Latin American and Caribbean Air Transport Association (ALTA Brasil) is a non-profit organization comprising the main companies in the civil aviation sector in the region. Its members
include the airlines responsible for more than 80% of air traffic in Latin America and the Caribbean. The fundamental purpose of this association is to coordinate collaborative efforts to foster the
development of a safer, more efficient, profitable and sustainable aviation environment. All this, in order to generate socioeconomic growth for the communities of Latin American and Caribbean
countries.
ALTA Brasil works to contribute to the development of an environment that is both safe and profitable for the region's airlines, always striving for the sustainability and economic well-being of the
nations that are part of this airspace.
US$90,160
Asociación Chilena de Líneas Aéreas (Achila)
The Chilean Airline Association (Achila) is an organization including the main airlines that operate in Chile—both domestic and international. Its objective is to promote the development and
sustainability of the civil aviation industry in the country, ensuring high standards of safety, quality and accessibility in air transportation.
Achila also works to strengthen air connections between Chile and the rest of the world, contributing to the sector’s competitiveness and economic growth.
US$62,000
› 223
12 / ANNEXES
OTHER INDICATORS SUGGESTED BY S&P
GLOBAL (CORPORATE SUSTAINABILITY
ASSESSMENT)
Success metrics for CEO compensation
LATAM group uses performance indicators for the
CEO's variable compensation, which are linked to
financial returns. These indicators generally reflect
a sound financial performance, such as Adjusted
EBITDAR (US$ million), Unleveraged Free Cash Flow
(US$ million) and ROIC (Adjusted NOPAT % divided
by Invested Capital).
Alignment with long-term performance
LATAM group offers long-term incentives as part of
its CEO's variable compensation, with the longest
vesting period reaching up to 42 months. This incentive
is awarded in the form of a bonus and is subject
to clawback policies. To the extent permitted by
applicable law, payments made under the CIP will
be subject to recovery or refund: (a) as required by
law or in accordance with any applicable Employer
policy; or (b) in the event that the Employee breaches
the restrictive covenants described above.
› 224
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GROUP
2024
LATAM
GROUP
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12 / ANNEXES
OUR BUSINESS
Regulatory framework
NCG 519: 6.1.III AND 6.1.IV INDUSTRIAL SECTOR
GRI 2-27
Below is a brief reference to the material effects of
aeronautical and other regulations in force in the
relevant jurisdictions in which we operate. We are
subject to the jurisdiction of various regulatory and
enforcement agencies in each of the countries where
we operate.
We believe we have obtained and maintained the
necessary authority, including authorizations and
operative certificates where required, which are
subject to ongoing compliance with statutes, rules
and regulations pertaining to the airline industry,
including any rules and regulations that may be
adopted in the future.
The countries where we carry out most of our
operations are contracting states and permanent
members of the ICAO, an agency of the United
Nations established in 1947 to assist in the planning
and development of international air transportation.
The ICAO establishes technical standards for the
international aviation industry. In the absence of
an applicable local regulation concerning safety or
maintenance, the countries where we operate have
incorporated by reference the majority of the ICAO’s
technical standards.
We believe that we are in material compliance with
all such relevant technical standards.
ENVIRONMENTAL AND NOISE REGULATION
There are no material environmental regulations
or controls in the jurisdictions in which we operate
imposed upon airlines, applicable to aircraft, or that
otherwise affect us, except for environmental laws
and regulations of general applicability.
In Chile, Brazil, Colombia, Ecuador, Peru, among
others, aircraft must comply with certain noise
restrictions. LATAM’s aircraft substantially comply
with all such restrictions, having implemented at least
the standard known as “Chapter 3 Requirements”
(Annex 16, Vol. 1 of ICAO) across its fleet.
SAFETY AND SECURITY
Our operations are subject to the jurisdiction of
various agencies in each of the countries where we
operate, which set standards and requirements for
the operation of aircraft and its maintenance.
In the United States, the Aviation and Transportation
Security Act requires, among other things, the
implementation of certain security measures by
airlines and airports, such as the requirement that
all passenger bags be screened for explosives.
Funding for airline and airport security required
under the Aviation Security Act is provided in part
by a US$5.60 per segment passenger security fee,
subject to a US$11.20 per round-trip cap; however,
airlines are responsible for costs in excess of this
fee. Implementation of the requirements of the
Aviation Security Act has resulted in increased costs
for airlines and their passengers. Since the events of
September 11, 2001, the United States Congress has
mandated, and the TSA has implemented, numerous
security procedures and requirements that have
imposed and will continue to impose burdens on
airlines, passengers and shippers.
Below are some specific aeronautical regulations
related to route rights and pricing policy in the
countries where we operate.
CHILE
Aeronautical Regulation
Both the DGAC and the Junta de Aeronáutica Civil
(“JAC”) oversee and regulate the Chilean aviation
industry. The DGAC reports directly to the Chilean Air
Force and is responsible for supervising compliance
with Chilean laws and regulations relating to air
navigation. The JAC is the Chilean civil aviation
authority.
Primarily on the basis of Decree Law No. 2,564, which
regulates commercial aviation, the JAC establishes
the main commercial policies for the aviation
industry in Chile and regulates the assignment of
international routes and the compliance with certain
insurance requirements, while the DGAC regulates
flight operations, including personnel, aircraft and
security standards, air traffic control and airport
management.
We have obtained and maintain the necessary
authority from the Chilean government to conduct
flight operations, including authorization certificates
from the JAC and technical operative certificates from
the DGAC, the continuation of which is subject to the
ongoing compliance with applicable statutes, rules
and regulations pertaining to the airline industry,
including any rules and regulations that may be
adopted in the future.
Chile is a contracting state, as well as a permanent
member, of the ICAO. Chilean authorities have
incorporated ICAO’s technical standards for the
international aviation industry into Chilean laws and
regulations. In the absence of an applicable Chilean
regulation concerning safety or maintenance, the
DGAC has incorporated by reference the majority
of the ICAO’s technical standards.
We believe that we are in material compliance with
all such relevant technical standards.
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Route Rights
Domestic Routes: Chilean airlines are not required to
obtain permits in order to carry passengers or cargo
on any domestic routes, but only to comply with the
technical and insurance requirements established
respectively by the DGAC and the JAC.
There are no regulatory barriers that would prevent
a foreign airline from creating a Chilean subsidiary
and entering the Chilean domestic market using that
subsidiary. On January 18, 2012, the Secretary of
Transportation and the Secretary of Economics of
Chile announced a unilateral opening of the Chilean
domestic skies. This was confirmed in November
2013, and has been in force since that date.
International Routes: As an airline providing services
on international routes, LATAM is also subject to a
variety of bilateral civil air transportation agreements
that provide for the exchange of air traffic rights
between Chile and various other countries. There can
be no assurance that existing bilateral agreements
between Chile and foreign governments will continue,
and a modification, suspension or revocation of one or
more bilateral treaties could have a material adverse
effect on our operations and financial results.
International route rights, as well as the corresponding
landing rights, are derived from a variety of air
transportation agreements negotiated between Chile
and foreign governments. Under such agreements, the
government of one country grants the government of
another country the right to designate one or more
of its domestic airlines to operate scheduled services
to certain destinations of the former and, in certain
cases, to further connect to third-country destinations.
In Chile, when additional route frequencies to and
from foreign cities become available, any eligible
airline may apply to obtain them.
If there is more than one applicant for a route
frequency, the JAC awards it through a public
auction for a period of five years. The JAC grants
route frequencies subject to the condition that the
recipient airline operates them on a permanent basis.
If an airline fails to operate a route for a period of six
months or more, the JAC may terminate its rights
to that route. International route frequencies are
freely transferable.
In October 2023, a public auction was held by JAC
for 13 international frequencies for the Santiago –
Lima route where three Chilean airlines participated,
LATAM won ten of thirteen, for which we paid US$
315.000.
Airfare Pricing Policy
Chilean airlines are permitted to establish their own
domestic and international fares without government
regulation. For more information, see “-Antitrust
Regulation” below.
In 1997, the Antitrust Commission approved and
imposed a specific self-regulatory fare plan for
our domestic operations in Chile consistent with
the Antitrust Commission’s directive to maintain
a competitive environment. According to this plan,
we must file notice with the JAC of any increase or
decrease in standard fares on routes deemed “non-
competitive” by the JAC and any decrease in fares
on “competitive” routes at least 20 days in advance.
We must file notice with the JAC of any increase
in fares on “competitive” routes at least 10 days in
advance.
In addition, the Chilean authorities now require that
we justify any modification that we make to our fares
on non-competitive routes. We must also ensure
that our average yields on a non-competitive route
are not higher than those on competitive routes of
similar distance.
PERU
Aeronautical Regulation
The Peruvian Dirección General de Aeronáutica Civil
(the “PDGAC”) oversees and regulates the Peruvian
aviation industry. The PDGAC reports directly to the
Ministry of Transportation and Communications and is
responsible for supervising compliance with Peruvian
laws and regulations relating to air navigation. In
addition, the PDGAC regulates the assignment of
national and international routes, and the compliance
with certain insurance requirements, and it regulates
flight operations, including personnel, aircraft and
security standards, air traffic control and airport
management.
We have obtained and maintain the necessary
authorizations from the Peruvian government to
conduct flight operations, including authorization
and technical operative certificates, the continuation
of which is subject to the ongoing compliance with
applicable statutes, rules and regulations pertaining
to the airline industry, including any rules and
regulations that may be adopted in the future.
Peru is a contracting state and a permanent member
of the ICAO. The ICAO establishes technical standards
for the international aviation industry, which Peruvian
authorities have incorporated into Peruvian laws and
regulations. In the absence of an applicable Peruvian
regulation concerning safety or maintenance, the
PDGAC has incorporated by reference the majority
of the ICAO’s technical standards.
We believe that we are in material compliance with
all relevant technical standards.
Route Rights
Domestic Routes: Peruvian airlines are required to
obtain permits in connection with carrying passengers
or cargo on any domestic routes and to comply with
the technical and legal requirements established by
the PDGAC. Non-Peruvian airlines are not permitted
to provide domestic air service between destinations
in Peru.
International Routes: As an airline providing services
on international routes, LATAM Airlines Peru is also
subject to a variety of bilateral civil air transport
agreements that provide for the exchange of air traffic
rights between Peru and various other countries.
There can be no assurance that existing bilateral
agreements between Peru and foreign governments
will continue, and a modification, suspension or
revocation of one or more bilateral treaties could
have a material adverse effect on our operations
and financial results.
International route rights, as well as the corresponding
landing rights, are derived from a variety of air
transport agreements negotiated between Peru and
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foreign governments. Under such agreements, the
government of one country grants the government
of another country the right to designate one or
more of its domestic airlines to operate scheduled
services to certain destinations of the former and,
in certain cases, to further connect to third-country
destinations.
In Peru, when additional route frequencies to and
from foreign cities become available, any eligible
airline may apply to obtain them. If there is more
than one applicant for a route frequency, the PDGAC
awards it in compliance with different designation
rules for a period of four years. The PDGAC grants
route frequencies subject to the condition that the
recipient airline operates them on a permanent basis.
If an airline fails to operate a route for a period of
90 days or more, the PDGAC may terminate its
rights to that route. In recent years the PDGAC has
revoked the unused route frequencies of several
Peruvian operators.
ECUADOR
Aeronautical Regulation
There are two institutions that control commercial
aviation on behalf of the State: (i) The Consejo
Nacional de Aviación Civil (“CNAC”), which directs
aviation policy; and (ii) the DGAC, which is a technical
regulatory and control agency.
The CNAC issues operating permits and grants
operating concessions to national and international
airlines. It also issues opinions on bilateral and
multilateral air transportation treaties, allocates
routes and traffic rights, and approves joint operating
agreements such as wet leases and shared codes.
Fundamentally, the DGAC is responsible for:
⚫ ensuring that the national standards and technical
regulations and international ICAO standards and
regulations are observed;
⚫ keeping records on insurance, airworthiness and
licenses of Ecuadorian civil aircraft;
⚫ maintaining the National Aircraft Registry;
⚫ issuing licenses to crews;
⚫ controlling air traffic control inside domestic air
space;
⚫ approving shared codes; and
⚫ modifying operations permits.
The DGAC also must comply with the standards and
recommended methods of ICAO since Ecuador is a
signatory of the 1944 Chicago Convention.
Route Rights
Domestic Routes: Airlines must obtain authorization
from CNAC (an operating permit or concession) to
provide air transportation.
For domestic operations, only companies incorporated
in Ecuador can operate locally. Currently, operations
can be conducted with an Ecuadorian registration
and/or a foreign registration under a dry lease
arrangement, but only with an Ecuadorian crew.
International Routes: Permits for international operations
are based on air transportation treaties signed by
Ecuador or, otherwise, the principle of reciprocity is
applied. All airlines doing business in Latin America
that are incorporated in countries that are members
of the Comunidad Andina de Naciones (the Andean
Community, or “CAN”) obtain their traffic rights on
the basis of decisions currently in force under that
regime, in particular decision N°582 of 2004, which
guarantee free access to markets, with no type of
restriction except technical considerations.
Airfare Pricing Policy
On October 13, 2011, The Statutory Law of Regulation
and Control of the Market Power was passed with
a purpose to avoid, prevent, correct, eliminate and
sanction the abuse of economic operators with market
power, as well as to sanction restrictive, disloyal and
agreements involving collusive practices. This Law
creates a new public entity as the maximum authority
of application and establishes the procedures of
investigation and the applicable sanctions, which
are severe.
Rates are not regulated and are subject only to
registration. In general, bilateral treaties regarding
air transportation allow for airfares to be regulated
by the regulation of the country of origin.
BRAZIL
Aeronautical Regulation
The Brazilian aeronautical industry is regulated and
supervised by the National Civil Aviation Agency
of Brazil (ANAC), which is linked to the Ministry of
Ports and Airports (MPOR) and works in conjunction
with the Civil Aviation Secretariat (SAC), which is
subordinate to the MPOR. The SAC is responsible for
defining public policies, while ANAC is responsible
for regulating and monitoring these policies.
ANAC, as Brazil’s civil aviation authority, oversees
compliance with Brazilian aviation laws and
regulations. It was primarily established under Law
No. 11.182/2005 to regulate commercial aviation,
the allocation of domestic and international routes,
compliance with specific insurance requirements,
flight operations—including personnel regulations,
aircraft, and safety standards—passenger rights
and duties, Brazil’s international representation in
civil aviation before international organizations, and
service inspections, among other matters.
In addition to ANAC, civil aviation in Brazil is also
controlled in terms of airspace and air navigation
by the Department of Airspace Control (DECEA), an
entity subordinated to the Air Force Command, which
in turn is subordinate to the Ministry of Defense.
Regarding airport infrastructure, since 2011, the
Federal Government has implemented the Airport
Concessions Program, and currently, 59 airports have
been granted concessions to the private sector. In
total, 11 economic groups control the concessioned
airports in Brazil. The Brazilian Airport Infrastructure
Company (Infraero) is responsible only for Santos
Dumont Airport in Rio de Janeiro.
LATAM Airlines Brazil has obtained and maintains the
necessary authority from the Brazilian government
to conduct flight operations, including authorization
and technical operative certificates from ANAC, the
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continuation of which is subject to ongoing compliance
with applicable statutes, rules and regulations
pertaining to the airline industry, including any rules
and regulations that may be adopted in the future.
ANAC is the Brazilian civil aviation authority and it is
responsible for supervising compliance with Brazilian
laws and regulations relating to air transport. Brazil
is a contracting state and a permanent member of
the ICAO. The ICAO establishes technical standards
for the international aviation industry, which Brazilian
authorities have incorporated into Brazilian laws and
regulations. In the absence of an applicable Brazilian
regulation concerning safety or maintenance, ANAC
has incorporated by reference the majority of the
ICAO’s technical standards.
Route Rights
Domestic Routes: Brazilian airlines operate under
a public services authorization regime, and for that
reason Brazilian airlines are required to obtain a
authorization from Brazilian authorities to provide
passenger and cargo air transportation services. In
addition, an Air Operator Certificate (“AOC”) is also
required for Brazilian Airlines to provide regular
domestic passenger or cargo transportation services.
Brazilian Airlines also need to comply with all technical
requirements established by the Brazilian Aviation
Authority (“ANAC”).
Based on the Brazilian Aeronautical Code (“CBA”)
established by Brazilian Federal Law No. 7,565/86,
there are no limitations to ownership of Brazilian
airlines by foreign investors, provided that the
airline is incorporated under Brazilian law and has
its headquarters and management based in the
country. The CBA also states that non-Brazilian
airlines are not authorized to provide domestic air
transport services in Brazil.
International Routes: Brazilian and non-Brazilian
airlines providing services on international routes
are also subject to a variety of bilateral civil air
transport agreements that provide for the exchange
of air traffic rights between Brazil and various other
countries. International route rights, as well as the
corresponding landing rights, are derived from a
variety of air transport agreements negotiated
between Brazil and foreign governments. Under
such agreements, the government of one country
grants the government of another country the right
to designate one or more of its domestic airlines to
operate scheduled services to certain destinations of
the former and, in certain cases, to further connect
to third-country destinations.
In Brazil, when additional route frequencies to and
from foreign cities become available, any eligible
airline may apply to obtain them. If there is more
than one applicant for a route frequency ANAC must
carry out a public bid and award it to the elected
airline. ANAC grants route frequencies subject to the
condition that the recipient airline operates them
on a permanent basis. ANAC’s resolution 491/18
indicates the requirements to establish the underuse
of a frequency, and how it could be revoked and
reassigned. This provision of the resolution came
into force in September 2019.
Airfare Pricing Policy
Brazilian and non-Brazilian airlines are permitted to
establish their own international and domestic fares,
in this last case only for Brazilian airlines, without
government regulation, as long as they do not abuse
any dominant market position they may enjoy.
Airlines may file complaints before the Antitrust
Authority (“CADE”) with respect to monopolistic or
other pricing practices by other airlines that violate
Brazil’s antitrust laws.
COLOMBIA
Aeronautical Regulation
The governmental entity in charge of regulating,
directing and supervising civil aviation in Colombia is
the Aeronáutica Civil (the “AC”), a technical agency
ascribed to the Ministry of Transportation. The AC
is the aeronautical authority for the entire domestic
territory, in charge of regulating and supervising the
Colombian air space. The AC may interpret, apply and
complement all civil aviation and air transportation
regulation to ensure compliance with the Colombian
Aeronautical Regulations (“RAC”). The AC also grants
the necessary permits for air transportation.
Route Rights
The AC grants operation permits to domestic and
foreign carriers that intend to operate in, from and to
Colombia. In the case of Colombian airlines, in order
to obtain the operational permit, the company must
comply with the RAC and fulfill legal, economic and
technical requirements, in order to later be subject
to public hearings where the public convenience and
necessity of the service is considered.
The same process must be followed to add national
or international routes; whose concession is subject to
the bilateral instruments entered into by Colombia.
The only exception for not complying with the public
hearing procedure is that the application comes from
a country member of the CAN, or that the route or
permit being applied for is part of a deregulated
regime. Even if it does not go through the public
hearing process, the airline must submit a complete
study to the AC and the request is made public on
the website of the authority.
Routes cannot be transferred under any circumstance
and there is no limit to foreign investment in domestic
airlines.
Airfare Pricing Policy
Since July 2007, as stated in resolution 3299 of the
Aeronautical Civil entity, bottom level airfares for
both international and domestic transportation were
eliminated. Under resolution 904 issued in February
2012, the Aeronautical Civil authority ceased to
impose the obligation of charging a fuel surcharge
for both domestic and international transportation
of passengers and cargo.
As of April 1, 2012, air carriers may now freely decide
whether to charge a fuel surcharge. In the case that
a fuel surcharge is charged, it must be part of the
fare, but shall be informed separately on the tickets,
advertising or other methods of marketing used by
the company.
In the same line, as of April 1, 2012, there is no
longer any restriction on maximum fares published
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by the airlines or with respect to the obligations
for air carriers to report to the Aeronautical civil
authority the fares and conditions the day after
being published.
Administrative fares are not subject to any changes,
and its charge is mandatory for the transport of
passengers under Aeronautical Civil Regulations.
Differential administrative fares apply to ticket sales
made through Internet channels.
ANTITRUST REGULATION
Chile
The National Economic Prosecutor Office (“FNE”
by its Spanish name) is one of the main antitrust
authorities in Chile. The FNE oversees and investigates
antitrust matters, which are governed by Decree
Law No. 211 of 1973, as amended, or the “Antitrust
Law.” The Antitrust Law considers as anticompetitive,
any conduct that prevents, restricts or hinders
competition, or sets out to produce said effects.The
Antitrust Law continues by giving examples of the
following anticompetitive conducts: (i) cartels; (ii)
abuse of dominance; and (iii) interlocking.
The FNE or an aggrieved person may sue for damages
arising from a breach of Antitrust Law by suing in the
Chilean Antitrust Court (the “TDLC” by its Spanish
name). The TDLC has the authority to impose a
variety of sanctions for violations of the Antitrust
Law, including: (i) the amendment or termination of
acts and contracts; (ii) the amendment or dissolution
of legal entities involved in the infringement; and/or
(iii) the imposition of a fine up to 30% of the sales
of the infringing entity corresponding to the line of
products and/or services associated to the infraction,
during the entire term for which the infringement
lasted; alternatively, a fine equal to the double of the
economic benefit obtained by the infringing company;
or when none of these alternatives can be applied,
a fine up to approximately US$50 million (60,000
UTA). If the TDLC finds an antitrust infringement, an
aggrieved person may sue for damages in a follow-
on suit before the TDLC, including both individual
claims as well as class actions.
The Antitrust Law also considers the possibility of
criminal sanctions for individuals involved in cartel
cases. On August 17, 2023 Chilean Law No. 21,595
(the Economic Crimes Act, or “ECA”) was published in
the Official Gazette. The ECA modified the criminal
sanctions applicable to individuals in cartel cases,
which include the following:
Imprisonment in its maximum degree to imprisonment
in its minimum degree (i.e., from 3 years and one
day to 10 years).
Fines, calculated according to the system of “daily
fines” (in principle, 151 to 200 daily fines). The value
of a daily fine corresponds to the average daily net
income that the convicted person has had in the
period of one year before the start of investigation
against such individual, considering work income, rents,
income from capital or income of any other kind. If
the average daily net income is disproportionately
low in relation to the assets of the convicted person,
the court may increase the value of the daily fine
by up to two times.
Disgorgement of profits, by which a person is
dispossessed of patrimonial assets whose value
corresponds to the amount of the profits obtained
through the crime or by perpetrating it. The profits
obtained include the rents and profits that have been
originated, whatever their legal nature. The profits
also include the equivalent of the costs avoided by
the wrongful act. The disgorgement of profits can
be imposed even without a conviction, provided it
is proven that the assets had their origin in an act
constituting a crime.
Disqualification from holding public office, from 3
years to perpetuity.
Disqualification from serving as director or principal
executive in any entity subject to the supervision of
the Financial Market Commission or in a company
controlled by the State, from 3 to 10 years.
Disqualification from contracting with the State (any
of its organs, services, companies or companies) and
termination of any contract in force with the State,
from 3 years to perpetuity. The disqualification is
extended to any company, foundation or corporation
in which the convicted person is directly or indirectly
a partner, shareholder or member.
These sanctions can be applied jointly. In addition,
according to the ECA, cartel crimes always qualify as
an “economic crime,” so that the specific determination
of the prison sentence to be imposed, as well as the
decision on its potential substitution by a form of
execution in freedom or with partial imprisonment,
is governed by the ECA.
Significant Precedents
Self-regulation plan
As described above under “—Route Rights—Airfare
Pricing Policy,” pursuant to Resolution No. 445 of
August 1995, the predecessor to the TDLC approved
a merger between LAN Chile and LADECO subject to
certain conditions, including a specific self-regulated
fare plan for domestic air passenger market consistent
with the TDLC’s directive to maintain a competitive
environment within the domestic market. This
self-regulated fare plan was updated by the TDLC
particularly to maintain its objective which consists
of a tariff regulation, through which maximum rates
are established on non-competitive routes under a
monthly compliance scheme. Thus, since October 1997,
LATAM Chile follows a self-regulated plan, which was
modified and approved by the TDLC in July 2005,
and further in September 2011. In February 2010,
the FNE closed the investigation initiated in 2007
regarding our compliance with this self-regulated
fare plan and no further observations were made.
Combination of LAN and TAM
In June 2012, the antitrust authorities in Chile and
Brazil each imposed certain mitigation measures
as part of their approval of the LAN/TAM merger.
Furthermore, the association was also submitted to
the antitrust authorities in Germany, Italy, Spain and
Argentina. All these jurisdictions granted unconditional
clearances for this transaction. For more information
regarding these mitigation measures please see
below.
The mitigation measures imposed by the TDLC in
connection with the LAN and TAM merger were part
of a decision issued on September 21, 2011 (the
“Decision”). The TDLC approved the proposed merger
between LAN and TAM, subject to 14 conditions as
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generally described below:
1. Swap certain slots in the Guarulhos Airport at
São Paulo, Brazil, to be used by an occasional third
party interested in offering direct non-stop flights
between São Paulo and Santiago;
2. Extension of the frequent flyer program to airlines
operating or willing to operate the Santiago-São
Paulo, Santiago-Río de Janeiro, Santiago-Montevideo
and Santiago-Asunción routes during the five-year
period from the effective time of the merger;
3. Execution of interline agreements with airlines
operating the Santiago-São Paulo, Santiago-Río de
Janeiro and Santiago-Asunción routes;
4. Certain capacity and other transitory restrictions
applicable to the Santiago-São Paulo route;
5. Certain amendments to LAN’s self-regulatory fare
plan approved by the TDLC with respect to LAN’s
domestic passenger business;
6. The obligation of LATAM to resign to one global
airline alliance within 24 months from the date in
which the merger becomes effective, except in the
case that the TDLC approves otherwise, or to elect
not to participate in any global airline alliance;
7. Certain restrictions on code-sharing agreements
with certain South American carriers or carriers outside
the global airline alliance to which LATAM belongs
for routes with origin or destination in Chile or that
connect to North America and Europe, including the
obligation to consult with, and obtain approval from,
the TDLC prior to its execution of certain of those
codeshare agreements (the “Seventh Condition”);
8. The abandonment of four air traffic frequencies
with freedom rights between Chile and Peru,
limitations to acquire more than 75% of the air traffic
frequencies in that route, and the term for which air
traffic frequencies may be granted to LATAM by the
Chilean authorities;
9. Issuance of a statement by LATAM supporting
the unilateral opening of the Chilean domestic skies
(cabotage) and abstention from any actions that
would prevent such opening;
10. Promotion by LATAM of the growth and normal
operation of the Guarulhos (Brazil) and Arturo Merino
Benítez (Chile) airports, to facilitate access thereto
to other airlines;
11. Certain restrictions regarding incentives to travel
agencies;
12. To maintain temporarily 12 round trip flights
per week between Chile and the United States and
at least seven round trip non-stop flights per week
between Chile and Europe;
13. Certain transitory restrictions on increasing fares
in the Santiago-São Paulo and Santiago - Rio de
Janeiro routes for the passenger business and for
the Chile-Brazil routes for the cargo business; and
14. Engaging an independent consultant, expert in
airline operations to, in coordination with the FNE,
monitor and audit compliance with the conditions
imposed by the Decision for 36 months.
Compliance with Seventh Condition
Around June 2015, the FNE filed a complaint against
LATAM before the TDLC alleging that LATAM was
not complying with the Seventh Condition. LATAM
filed a statement of defense opposing the claim and
later reached a settlement agreement with the FNE
(the “Settlement Agreement”) which was approved
by the TDLC on December 22, 2015. The Settlement
Agreement terminated the legal proceeding initiated
by the FNE and did not establish any violation by
LATAM of the TDLC resolutions or any applicable
antitrust regulations by LATAM. The Settlement
Agreement did establish the obligation of LATAM to
amend and terminate certain code share agreements
and contract an independent third party consultant,
which would act as an advisor to the FNE to monitor
the compliance by LATAM of the Seventh Condition
and the Settlement Agreement.
Joint Venture with Delta
On October 15, 2019, LATAM was notified that the
FNE had opened an investigation regarding a joint
venture agreement entered into between LATAM and
Delta Air Lines Inc. (“Delta”). On August 13, 2021,
Delta and LATAM reached an out-of-court-agreement
with FNE to close the investigation and allow the
implementation of their joint venture agreement,
subject to certain mitigation measures. On October
28, 2021 the settlement was approved by the TDLC.
The mitigation measures included, among others,
obligations for LATAM to restrict and isolate
information exchanges and databases related to joint
venture markets, as well as updating the company’s
compliance program. The settlement also imposes
certain obligations on Delta and on directors to
LATAM’s board nominated with Delta’s votes, such
as affidavits attesting the independence of LATAM’s
directors nominated with Delta’s votes, compliance
measures to restrict the exchange of commercially
sensitive information, and periodic antitrust training
regarding their obligations under the settlement.
Relatedly, on November 6, 2023, LATAM, Delta and
FNE reached another out-of-court agreement to
amend part of the codeshare agreements between
the companies, which was approved by the TDLC
on December 7, 2023.
Brazil
The CADE approved the LAN/TAM merger by
unanimous decision during its hearing on December
14, 2011, subject to the following conditions: (1)
the new combined group (LATAM) should leave
one of the two global alliances to which it was a
part of (Star Alliance or oneworld); and (2) the new
combined group (LATAM) should offer to swap two
pairs of slots in Guarulhos International Airport, to
be used by an occasional third party interested in
offering direct non-stop flights between São Paulo
and Santiago, Chile. These impositions are in line
with the mitigation measures adopted by the TDLC,
in Chile.
On February 24, 2021, the CADE approved without
remedies the Joint Venture Agreement between Delta
Air Lines and LATAM Airlines Group. Previously, in a
separate case, the CADE approved without remedies
the acquisition by Delta Air Lines of up to 20% of
LATAM common shares on March 18, 2020.
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On January 15, 2024, the General Superintendence
of CADE approved, without restrictions, the inclusion
of freight transportation in the scope of the joint
venture between Delta and LATAM.
On March 21, 2024, reacting to a press article, CADE
sent an official letter to LATAM Airlines Brazil in
order to obtain information related to the acquisition
of other types of aircraft. LATAM is cooperating
with the authority and has submitted all necessary
clarifications.
Uruguay
On December 14, 2020 the antitrust authority of
Uruguay (Comisión de Promoción y Defensa de la
Competencia) approved the Joint Venture Agreement
between LATAM and Delta Air Lines. The same
agreement was filed before the aeronautical authority
of Uruguay (the Dirección Nacional de Aviación Civil
e Infraestructura Aeronáutica) on September 21,
2020 and approved by default on December 20,
2020, as the timeframe provided by the Aeronautical
Code Law to the authority in order to resolve on the
matter expired (90 days after filing).
United States
On July 8, 2020 LATAM and Delta Air Lines applied for
approval and antitrust clearance of all the agreements
related to their Joint Venture Agreement before
the U.S. Department of Transportation (“DOT”). On
September 30, 2022, the DOT approved the Joint
Venture Agreement between Delta Air Lines and
LATAM group.
Colombia
On September 4, 2020 LATAM and Delta Air Lines
applied for an approval of the Joint Venture Agreement
before Aerocivil, which was finally received on May
10, 2021.
MATERIAL FACTS
NCG 519: 10. RELEVANT OR MATERIAL FACTS
Santiago, April 3, 2024
Others
In accordance with article 9 and second paragraph
of article 10 of Law No. 18,045 and with General
Regulation No. 30 and Circular No. 660, both of the
Financial Market Commission, duly empowered for
this purpose, I inform you of the following Material
Fact regarding LATAM Airlines Group S.A. (the
"Company”):
Resignation of Director
The Company's Board of Directors, in a meeting
held today, took note of the resignation presented
on this same date by Mr. Bouk Van Geloven in his
position as Director of the Company, which will be
effective as of 11:59 p.m. April 24, 2024. The Board
of Directors expressed its gratitude for the work
carried out by Mr. Van Geloven and his contribution
to the Company. As a result of said resignation,
and in accordance with the provisions of article 32
of Law No. 18,046 on Corporate Law, at the next
Ordinary Shareholders' Meeting, whose summons
is reported below, the Board of Directors must be
completely renewed.
Summons to Extraordinary and Ordinary Shareholders'
Meetings:
The Board of Directors of the Company, in the same
meeting today, agreed to call an Extraordinary
Shareholders' Meeting to be held on April 25, 2024, at
11:00 a.m., and an Ordinary Shareholders' Meeting,
to be held immediately thereafter of the above,
which will take place at Mac-Iver 125, 17th floor,
Santiago, in order to know or rule, as appropriate,
on the matters indicated below:
Extraordinary Shareholders Meeting
⚫ he Extraordinary Meeting will have the following
matters as its objective:
⚫ Eliminate the fourth transitional article of the
corporate bylaws.
⚫ Record the full reduction of the share capital due
to the expiration of the term for placing the bonds
convertible into shares issued against the capital
increase agreed at the Extraordinary Shareholders'
Meeting of the Company dated July 5, 2022; and
⚫ In general, adopt the reforms of the bylaws and all
other agreements that are necessary or convenient
to carry out the decisions adopted by the Board.
Ordinary Shareholders Meeting
The Ordinary Meeting will have the following matters
as its object:
⚫ Annual Report, Balance Sheet and Financial
Statements corresponding to Fiscal Year 2023; the
situation of the Company; and respective report
from the External Audit Company;
⚫ Distribution of a definitive dividend upon the
profits for Fiscal Year 2023;
⚫ Election of the Board of Directors;
⚫ Remuneration of the Board of Directors for Fiscal
Year 2024;
⚫ Remuneration and budget of the Directors'
Committee for Fiscal Year 2024;
⚫ Designation of the External Audit Company;
⚫ Designation of Risk Rating Agencies;
⚫ Definition of the newspaper for the publications
that the Company must make;
⚫ Report of operations with related parties; and
⚫ Other matters of corporate interest that are specific
to the Ordinary Shareholders' Meeting.
The Company's Board of Directors has resolved to
implement remote means of participation and voting
at the Meetings.
The holders of shares registered in the Shareholders
Registry at midnight of the fifth business day prior
to the day of its celebration, that is, registered at
midnight on April 19, 2024, will have the right to
participate in the Meetings, and to exercise their
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right to speak and vote in them.
The shareholders interested in participating in the
Meetings, or their representative, must register,
by 3:00 p.m. on the day before the Meetings, by
sending an email to the box registrojuntas@dcv.
cl, expressing their interest in participating in the
Meetings, attaching a scanned image of their identity
card on both sides or their passport; of power, if
applicable; and the application form for participation
in the Meetings. The Meetings will take place
through the Zoom videoconference platform and
voting by acclamation or voice voting, or through the
electronic voting platform provided by DCV Registries
S.A. which will be entered through the Click&Vote
platform, through the link “Join the Board”. The rest
of the required documentation and more detailed
information regarding how to register, participate and
vote remotely in the Meetings and other aspects that
are appropriate for this purpose, will be available and
will be communicated in a timely manner through
instructions that will be uploaded to the Company's
website, www.latamairlinesgroup.net.
The summons announcements will be published in
the Diario La Tercera, of Santiago, on April 10, 15
and 19, 2024.
Shareholders may obtain a copy of the documents
that support the matters on which they must
pronounce at the Meetings, as of April 10, 2024, on
the Company's website, www.latamairlinesgroup.net.
In addition, any shareholder who wishes to obtain
a copy of said documents can contact, also from
April 10, 2024, the Company's Investor Relations
Department at the email address InvestorRelations@
latam.com or by calling (56-2) 2565- 3844, for this
purpose. Among such documents, information will
be available on the alternatives of external audit
companies that will be proposed to the Ordinary
Meeting for Fiscal Year 2024 and their respective
foundations.
Dividend Proposal:
Finally, the Board of Directors agreed to propose at
the Ordinary Meeting the distribution of Dividend No.
52, Definitive, Minimum Mandatory, 30% of the net
profits for Fiscal Year 2023, that is, the equivalent
sum in pesos of US$174,549,442.99 , which means
distributing a dividend of US$0.0002887797894
per share, which would be paid on May 16, 2024, in
its equivalent in pesos according to the “observed”
exchange rate published in the Diario Oficial on the
fifth business day prior to day of distribution, that
is, on May 10, 2024. In the event that the dividend
is approved in the terms proposed by the Board of
Directors, shareholders registered in the Shareholders
Registry at midnight on May 10, 2024 will be entitled
to receive the dividend.
Santiago, April 3, 2024
Others
In accordance with article 9 and second paragraph of
article 10 of Law No. 18,045 and with General Rule
No. 30 and Circular No. 660, both of the Financial
Market Commission, duly empowered for this purpose,
I inform the following Material Fact regarding LATAM
Airlines Group S.A. (“LATAM" or the "Company”):
⚫ In a meeting held on this same date, the Company's
Board of Directors approved to begin the process
to open and relist the Company's ADRs on the
New York Stock Exchange (“NYSE") (the "Relisting
of the ADR Program"). This process entails various
procedures and requirements before the Securities
and Exchange Commission of the United States of
America and the NYSE.
⚫ Once the requirements referred to in paragraph
1 above have been met, it will be up to the Board
of Directors to decide whether or not to ultimately
approve, and make effective, the ADR Program
Relisting. The Relisting of the ADR Program thus
resolved will be opportunely informed by a new
material fact. This decision will be taken:
- once the consent is obtained from those
who were the main creditors supporting the
reorganization plan of the Company that was
approved and confirmed in its reorganization
procedure under Chapter 11 of the Bankruptcy
Code of the United States of America, and without
which the Company would not have emerged
from said reorganization procedure; and
- considering market conditions and the best
interest of the Company.
⚫ The process to finalize the Relisting of the ADR
Program is estimated at this date to take up to six
months, starting from this Material Fact.
The Company will keep its shareholders and the
market in general informed about the progress of
the Relisting of the ADR Program process.
Santiago, April 25, 2024
Others
In accordance with the provisions of article 9 and
second paragraph of article 10 of Law No. 18,045
on the Securities Market, and in General Standard
No. 30 of your Commission, duly empowered for
this purpose, I allow myself to inform you of the
following in character of an Material Fact of LATAM
Airlines Group S.A. (“LATAM”):
⚫ Bylaw Reforms
At the Extraordinary Shareholders' Meeting of
LATAM (the “Extraordinary Meeting”) held on this
date, April 25, 2024, all the bylaw reforms for which
said Meeting was summoned were approved, among
which the elimination of the fourth transitory article
of the LATAM bylaws, which regulated the duration
of the Board of Directors. The resignation presented
by Mr. Bouk Van Geloven from his position as
Director on April 3, 2024, as reported in an Material
Fact of that same date, necessitated the complete
renewal of the members of the Board of Directors
at the Ordinary Shareholders' Meeting, to which
point II below refers. Following the elimination of
the aforementioned article, the Board of Directors
elected at said Meeting will remain in office for a
period of two years from this date.
⚫ Total Renewal of the Board of Directors.
At the Ordinary Shareholders' Meeting of LATAM
also held on this date, immediately following the
Extraordinary Meeting, the LATAM Board of Directors
was renewed.
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The following people were elected:
⚫ Mr. Enrique Cueto Plaza;
⚫ Mr. Ignacio Cueto Plaza;
⚫ Mr. Frederico F. Curado (as independent director);
⚫ Mr. William de Wulf;
⚫ Mr. Antonio Gil Nievas;
⚫ Mr. Bornah Moghbel;
⚫ Mr. Michael Neruda;
⚫ Mrs. Sonia Villalobos; and
⚫ Mr. Alexander D. Wilcox.
Santiago, April 25, 2024
Profit sharing (dividend payment)
In accordance with the provisions of Circular No.
660, dated October 22, 1986, of your Commission,
and duly authorized, I inform your Commission that
at the Ordinary Shareholders' Meeting of LATAM
Airlines Group S.A. (“LATAM”) held on this date,
April 25, 2024, the distribution of Dividend No. 52,
Definitive, Mandatory Minimum, was approved up
to the 30% of the net income for Fiscal Year 2023,
that is, the equivalent amount in Chilean pesos of
US$174,549,442.99, which means to distribute a
dividend of US$0.0002887797894 per share, which
will be paid on May 16, 2024, in its equivalent in
Chilean pesos according to the “observed” exchange
rate published in the Diario Oficial on the fifth
business day prior to the distribution day, that is,
on May 10, 2024.
Shareholders registered in the Shareholders Registry
at midnight on May 10, 2024, will be entitled to
receive the dividend.
The notice referred to in Section II of the aforementioned
Circular 660 will be published on May 8, 2024, in the
newspaper “La Tercera” of Santiago.
Attached is form No. 1 which establishes the same
Circular No. 660, duly completed and signed.
Santiago, May 3, 2023
Others
In accordance with article 9 and second paragraph of
article 10 of Law No. 18,045 and with General Standard
No. 30, of your Commission, duly empowered for this
purpose, I inform you of the following Material Fact
regarding LATAM Airlines Group S.A. (the "Company”):
President and Vice President.
At the Board Meeting held on this same date, Ignacio
Cueto Plaza and Bornah Moghbel were appointed
President and Vice President of the Board of Directors,
respectively.
Directors’ Committee.
Likewise, in the same Board Meeting and as provided
in article 50 bis of Law No. 18,046 on Limited
Corporations, it was noted that the Directors’
Committee would be made up of Directors Frederico
Curado (as an independent director), Michael Neruda
and Sonia J.S. Villalobos.
Santiago, July 2, 2024
Others
In accordance with article 9 and second paragraph of
article 10 of Law No. 18,045 and with General Rule
No. 30, both of the Financial Market Commission,
duly empowered to this effect, I inform the following
Material Fact regarding LATAM Airlines Group S.A.
(“LATAM" or the "Company”):
⚫ As reported by the Material Fact dated April 3,
2024, on such date LATAM’s Board of Directors
approved to begin the process of opening and relisting
the Company’s ADR program in the New York Stock
Exchange (the "Relisting of the ADR Program"). Such
process is currently ongoing.
⚫ With the conviction that a secondary sale, if it
happens, could result in an increase of the liquidity of
the program, and therefore, make more effective the
Relisting of the ADR Program, LATAM explored with
certain creditors that were backstop parties of our
reorganization plan (the “Reorganization Plan”) that
was approved and confirmed in our reorganization
proceeding in the United States of America according
to the rules set forth in Chapter 11 of Title 11 of the
Code of the United States of America (the “Chapter
11 Proceeding”) – who as of today are shareholders
as a result of its implementation, whether they
would be interested in principle in considering a
possible secondary sale of a portion of their equity
interest in the Company. In this regard, by means
of information of interest disclosed on May 17,
2024 we informed that, although at that date they
had not made any decision on the matter, they did
confirm their preliminary interest and indicated
that such decision would be possibly driven by the
implementation process of the Relisting of the ADR
Program and market conditions.
⚫ In this regard, it should be recalled that in the context
of the implementation of the Reorganization Plan,
as informed in the Material Fact dated November
3, 2022, among other things:
- In November 2022, the Company’s creditors
received in settlement of their claims, notes
convertible into shares of the Company, which
have been previously converted.
- The Company and the backstop parties of the
restructuring contemplated in the Reorganization
Plan entered into a Registration Rights Agreement
(“RRA”). Under the RRA those backstop parties
would be entitled to obtain the Company’s
support if they opted to divest all or a portion
of their equity interests in LATAM in one or more
secondary public offerings of shares in firm
commitment underwritings in the United States
of America registered with the Securities and
Exchange Commission of the United States of
America (underwritten public offering). Hereinafter,
each such secondary sale, a “Secondary Sale
under the RRA”. According to the terms of the
RRA, the first Secondary Sale under the RRA (i)
can only be initiated at the request of the main
backstop parties under the RRA (the “Necessary
Backstop Parties”); and (ii) shall, in the good
faith judgement of the managing underwriters
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therefor, represent at least US$ 200 million.
A copy of the RRA was made public on November
2022 in the docket of the Chapter 11 Proceeding
as a supplement to our Reorganization Plan.
The execution of the RRA was a condition precedent
for the support by the backstop parties of the
restructuring set forth in the Reorganization
Plan, without which the Company would have
not emerged from bankruptcy.
⚫ As a result of this process, on the date hereof,
the Company received from certain shareholders
that are Necessary Backstop Parties under the
RRA (collectively, the “Selling Shareholders”) an
underwritten offering request that complies with the
requirements of the RRA to proceed with the first
Secondary Sale under the RRA, subject to certain
factors, including market conditions.
Considering what is indicated in the paragraph 2.
above, it is the Company’s intention that the Relisting
of the ADR Program takes place concurrently with
the first Secondary Sale under the RRA with the
conviction that, as stated above, greater liquidity
will make the Relisting of the ADR Program more
effective in the best interest of the Company and
its shareholders in general.
⚫ It is worth mentioning that according with the
terms of the RRA, the Selling Shareholders have the
power to determine the date in which the secondary
sale takes place, being even entitled to retract or
modify the size of the secondary sale. Therefore,
since the preference is that the Relisting of the ADR
Program takes place concurrently with the first
Secondary Sale under the RRA, on the date hereof
the Company does not have certainty of the date
in which the Relisting of the ADR Program and the
first Secondary Sale under the RRA could take place.
⚫ It is contemplated that such first Secondary Sale
under the RRA would occur solely in the United
States of America and other jurisdictions outside of
the Republic of Chile through the issuance of new
ADRs on the same date of the Relisting of the ADR
Program.
⚫ Pursuant to the terms of the RRA, the other
creditors parties thereto, who as of today are also
shareholders as a result of the implementation of
the Reorganization Plan, have the right to adhere to
this first Secondary Sale under the RRA as selling
shareholders. To that effect, the Company will give
the notices contemplated in such agreement so
that the other signatories of the RRA may decide
to exercise or not their right to adhere.
⚫ In the event that, as indicated above, the Selling
Shareholders opt to postpone or withdraw their
request for the secondary sale referred to in this
material fact, the Board of Directors of the Company
will evaluate the best opportunity for the Relisting
of the ADR Program when the conditions described
in greater detail in our material fact of April 3, 2024
are met (i.e., (i) subject to the consent of those who
were the main creditors supporting the Reorganization
Plan approved and confirmed in the Chapter 11
Proceeding, without which the Company would not
have emerged from said reorganization procedure;
and (ii) considering market conditions and the best
interest of the Company).
The Company will keep its shareholders and the
market in general informed about progress on the
Relisting of the ADR Program and the first Secondary
Sale under the RRA.
As required by Rule 135e under the U.S. Securities
Act of 1933, as amended (the “U.S. Securities Act”),
this material fact does not constitute an offer to sell
or the solicitation of an offer to buy securities in the
United States, and securities may not be offered or
sold in the United States absent registration or an
exemption from registration. Any offers, solicitations
or offers to buy, or any sales of securities, including a
potential secondary sale, will be made in accordance
with the registration and prospectus requirements
of the Securities Act.
Santiago, July 15, 2024
Others
Pursuant to the provisions of Article 9 and the second
paragraph of Article 10 of Law No. 18,045, and to the
provisions of General Rule No. 30, duly authorized
by the Board of Directors at a meeting held on this
same date, I hereby inform the Financial Market
Commission (the "Commission"), as a MATERIAL
FACT of LATAM Airlines Group S.A. (“LATAM" or the
"Company”), the following:
⚫ On March 29, 2016, the Company entered into
a revolving credit facility agreement with several
banks, which was subsequently amended and
restated on November 3, 2022 by private instrument
in the English language and subject to the laws of
the State of New York, United States of America,
named "Amended and Restated Credit and Guaranty
Agreement", whereby the Company was granted a
revolving credit facility in the principal amount of
US$600 million (the "Revolving Credit Facility I"). The
Revolving Credit Facility I was initially secured by a
combination of aircrafts, engines and other spare
parts owned by LATAM and TAM Linhas Aéreas S.A.
Today, the Company, acting through its branch
domiciled in the State of Florida, United States of
America, has entered into an amendment to the
Revolving Credit Facility I (the "Revolving Credit
Facility I Amendment"). This Revolving Credit Facility
I Amendment is intended to, among other things: (i)
extend the scheduled maturity date of the Revolving
Credit Facility I to July 2029 (original maturity
November 2025) , with an option to extend it until
July 2030; (ii) increase the amount of the Revolving
Credit Facility I from US$600 million to an aggregate
amount of US$800 million; (iii) eliminate references to
the reorganization proceeding to which the Company
and several of its subsidiaries were subject under
the rules of Chapter 11 of Title 11 of the United
States Code (the "Chapter 11 Proceeding"); and (iv)
include additional lenders to the Revolving Credit
Facility I, so that after the Revolving Credit Facility
I Amendment, the lenders thereto will be the ones
listed paragraph 3 below.
Finally, it should be noted that the Company will
secure such Revolving Credit Facility I Amendment
with different assets comprised of a combination of
aircrafts, engines and several spare parts owned by
the Company and TAM Linhas Aéreas S.A., and will
have the option to modify or replace such security
interests, with the consent of the majority of the
banks participating in the Revolving Credit Facility
Amendment I. In addition, TAM Linhas Aéreas S.A.
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will act as guarantor of the Company's obligations
under the Revolving Credit Facility I Amendment.
⚫ As informed by a material fact dated October 11,
2022, in the context of the financing granted to the
Company to emerge from the Chapter 11 Proceeding,
the Company, acting through its branch domiciled
in the State of Florida, United States of America,
entered into on October 12, 2022, a US$500 million
revolving credit facility through a private instrument
in the English language and subject to the laws of
the State of New York, United States of America,
named “Super-Priority Debtor-In-Possession and
Exit Revolving Loan Agreement” with several banks
and financial institutions as lenders, JPMorgan Chase
Bank as administrative agent for such lenders and
Wilmington Trust, National Association as collateral
trustee agent for the secured parties (the "Revolving
Credit Facility II", and together with the Revolving
Credit Facility I, the "Revolving Credit Facilities").
Today, the Company, acting through its branch
domiciled in the State of Florida, United States of
America, has entered into the amendment to the
Revolving Credit Facility II (the "Revolving Credit
Facility II Amendment", and together with the Revolving
Credit Facility I Amendment, the "Revolving Credit
Facility Amendments"), to the effect of, among other
things: (i) extending the scheduled maturity date
of the Revolving Credit Facility II from November
2026 to July 15, 2029; provided, however, that the
Revolving Credit Facility II may be payable in advance
180 days prior to the maturity date of any of the
financing agreements that share collateral with the
Revolving Credit Facility II if by then such financing
agreements have not been paid or extended; (ii)
increasing the amount of the Revolving Credit
Facility II from US$500 million to US$750 million;
(iii) deleting references to the Chapter 11 Proceeding;
(iv) including additional lenders to the Revolving
Credit Facility II, such that following the Revolving
Credit Facility II Amendment, the lenders thereto
will be the ones identified in paragraph 3 below;
and (v) modifying certain commercial terms of the
Revolving Credit Facility II relating to interest rates
and fees, including the following:
- Interest Rates:
Starting November 2026, (i) the margin applicable
to each interest rate will be reduced by 1.00%
(from 3.00% to 2.00% for the ABR interest rate
and from 4% to 3% for the Term SOFR Rate and
Daily Simple SOFR Rate); (ii) a utilization fee
will be introduced in addition to the applicable
margin applicable to each interest rate, which
varies between 0.10% and 0.50% depending on
the amount disbursed; and (iii) adjustments to
the Term SOFR Rate and Daily Simple SOFR will
be eliminated.
- Commitment fee:
Starting November 2026, the commitment fee
will be increased from 0.625% to 1.00%.
- Finally, as a result of the Revolving Credit
Facility II Amendment, it will be necessary to
modify the collateral documents granted both
in Chile and abroad, which secure the Revolving
Credit Facility II, so that the security interests
thereunder are extended to this amendment.
⚫ Following the Revolving Credit Facility Amendments,
the lenders under the Revolving Credit Facilities are
JPMorganChase Bank, N.A.; Goldman Sachs Lending
Partners LLC; Citibank, N.A.; Barclays Bank PLC;
Banco Santander, S.A.; Deutsche Bank Securities
Inc, New York Branch; BNP Paribas; MUFG Bank,
LTD and Natixis, New York Branch.
⚫ As a result of the Revolving Credit Facility
Amendments, the Company will have as of the date
hereof, a total of US$1,550 million of Revolving Credit
Facilities with a scheduled maturity date in 2029.
As of the date hereof, the Company has not drawn
on the Revolving Credit Facilities and therefore they
are fully available.
Santiago, July 18, 2024
Others
In accordance with article 9 and second paragraph of
article 10 of Law No. 18,045 and with General Rule
No. 30, both of the Financial Market Commission,
duly empowered to this effect, I inform the following
Material Fact regarding LATAM Airlines Group S.A.
(“LATAM" or the "Company”):
⚫ As reported in material facts dated April 3, 2024,
and July 2, 2024, the Company is currently in the
process of reopening and relisting its ADR program on
the New York Stock Exchange (“NYSE”) (the “Relisting
of the ADR Program”). This process entails various
procedures and requirements before the Securities
and Exchange Commission of the United States of
America (the “SEC”) and the NYSE.
⚫ As part of the procedures and requirements for
the Relisting of the ADR Program:
- The Board of Directors has approved LATAM to
enter into a new deposit agreement (the “New
Deposit Agreement”) with the depositary bank
of its ADR program (i.e., JP Morgan);
- The Board of Directors has approved LATAM to
submit to the SEC the forms F-6, F-3, preliminary
prospectus supplement to the F-3, MD&A 6-K
and form 8-A, among others, as required by
U.S. regulations; and
- In order to perform the duties of the audit
committee required under U.S. regulations, the
Board of Directors has created a committee of
the Board to serve as the Audit Committee. This
Audit Committee is in addition to the Directors’
Committee required under article 50 bis of Chilean
Law No. 18,046. Such Audit Committee will be
integrated by Mr. Frederico P. Fleury Curado and
Ms. Sonia J.S. Villalobos.
⚫ The New Deposit Agreement contemplates,
among other things, the amendment of the ratio
currently in effect between shares and ADRs (the
“Ratio Change”), from the existing ratio of 1:1 to a
new ratio of 2,000:1 (i.e., each ADR will represent
two thousand shares). It is expected that the Ratio
Change will become effective on or around July 24,
2024.
Regarding the ADRs currently in existence, measures
will be adopted to implement this new ratio as
required under U.S. regulations.
LATAM
GROUP
2024
› 236
12 / ANNEXES
⚫ The Company’s Board of Directors also approved
on the date hereof that, within the context of the
Relisting of the ADR Program, and with effect from
the date it becomes effective, 100,000,000 new
ADRs will be registered. To implement the above,
the corresponding filings will be made with the SEC.
These new ADRs are in addition to the 217 million
ADRs currently registered, and therefore, the number
of ADRs registered will total approximately 317
million. These new ADRs will be available to those
shareholders who, from time to time, opt to exchange
their shares for ADRs in our ADR program.
⚫ As reported in the material fact dated July 2,
2024, the preference of the Company continues
to be that the Relisting of the ADR Program takes
place simultaneously with the first secondary sale
under the registration rights agreement (“RRA”
- Registration Rights Agreement, and this first
secondary sale thereunder, the “First Secondary
Sale under the RRA”).
⚫ Considering such preference, the Board of Directors
will determine the date on which the Relisting of
the ADR Program shall become effective once the
occurrence of the First Secondary Sale under the
RRA is confirmed to take place and in order to enable
such sale.
⚫ According to the information available as of the date
hereof to the Board, the First Secondary Sale under
the RRA is expected to occur on or around July 24,
2024, at which time the corresponding underwriting
agreement will be signed. If confirmed, the Board of
Directors will determine that the date on which the
Relisting of the ADR Program shall become effective
will be on or around July 25, 2024.
⚫ Having said that, notwithstanding the interest of
the shareholders that requested the First Secondary
Sale under the RRA (the “Selling Shareholders”) to
proceed with such sale, the Selling Shareholders may
withdraw their request for the First Secondary Sale
under the RRA until the corresponding underwriting
agreement is signed.
⚫ If the Selling Shareholders withdraw from the
First Secondary Sale under the RRA, it is reasonable
to expect that the Relisting of the ADR Program
should be implemented at a later time in the future,
subject to the approval of the Board of Directors and
the conditions described in the material fact dated
April 3, 2024 (i.e.,(i) the consent is obtained from
those who were the main supporting creditors of the
plan of reorganization approved and confirmed in
the Chapter 11 Proceeding, and who are the Selling
Shareholders; and (ii) the concurrence of adequate
market conditions and the best interest of the
Company).
⚫ As of this date, the Company expects that the
Relisting of the ADR Program shall become effective
on or around July 25, 2024 subject to the signing
of the corresponding underwriting agreement as
indicated in preceding paragraph 7.
The Company will keep its shareholders and the
market in general informed about the progress of
the Relisting of the ADR Program.
Santiago, July 18, 2024
Others
In accordance with article 9 and second paragraph of
article 10 of Law No. 18,045 and with General Rule
No. 30, both of the Financial Market Commission,
duly empowered to this effect, I inform the following
Material Fact regarding LATAM Airlines Group S.A.
(“LATAM” or the “Company”):
⚫ As reported through material facts dated April 3,
2024, July 2, 2024, and July 17th, 2024:
- The Company is currently in the process of
reopening and relisting its ADR program on the
New York Stock Exchange (the “Relisting of the
ADR Program”); and
- The preference of the Company continues to
be that the Relisting of the ADR Program takes
place concurrently with the first secondary sale
under the registration rights agreement (“RRA”)
granted in the context of the emergence from
the reorganization proceeding under Chapter 11
of Title 11 of the United States Code (the “First
Secondary Sale under the RRA”).
⚫ Although the Company does not have certainty
about the date on which the First Secondary Sale
under the RRA and the Relisting of the ADR Program
could take place, on this date:
- The Company will submit to the Securities
and Exchange Commission of the United States
of America (the “SEC”) the prospectuses and
other filings required by the SEC regulations
in order to make progress in the potential First
Secondary Sale under the RRA (namely, (i) Form
F-3, (ii) preliminary prospectus supplement to
Form F-3, (iii) MD&A 6-K, and (iv) Form 8-A).
Hereafter, these filings will be referred to as the
“SEC Filings”; and
- The respective roadshow will commence. The
foregoing, as stated in the material fact dated
July 17th, 2024, is notwithstanding that the
shareholders who requested the First Secondary
Sale under the RRA may withdraw their request
until the corresponding underwriting agreement
is signed.
⚫ As advised by the external legal advisors of the
Company in the United States of America, when carrying
out a primary or secondary placement of shares of a
company is proposed following the completion of a
fiscal quarter, it is expected, and indeed customary,
for the respective company to publicly disclose
certain preliminary financial information regarding
that quarter. In such cases, Regulation G and Item
10(e) of Regulation S-K under the U.S. Securities
Act of 1933 require the respective company to make
certain additional disclosures related to non-GAAP
and non-IFRS financial measures (the “Additional
Financial Metrics”).
In order for the SEC filings to comply with the above,
such filings must also include, among other things: (i)
the most directly comparable GAAP or IFRS financial
measures; and (ii) a quantitative reconciliation to
the nearest GAAP or IFRS financial measure for the
historical Additional Financial Metrics.
⚫ Given the aforementioned paragraph, since the
LATAM
GROUP
2024
› 237
12 / ANNEXES
SEC Filings will be made only a few days after the
close of the second quarter, which ended on June
30, 2024, the SEC Filings include certain financial
information regarding the end of that quarter. A copy
of this information is attached to this material fact
as Appendix A.
⚫ The financial information related to the second
quarter of 2024 disclosed herein is in the process
of being audited, has a limited scope, and therefore
may be subject to adjustments in connection with
the regulatory process of preparing the Company’s
quarterly financial statements (including, as applicable,
due to external or facts, our internal review or the
review by our external auditors). The quarterly
financial statements for the second quarter of 2024
will be disclosed as previously informed on August 7.
This financial information does not constitute
nor replace in any way the submission of the
corresponding financial statements to the Financial
Market Commission and the market, regarding the
content requirements, procedures, and deadlines for
submission stipulated by said Service in the current
regulations.
The Company will keep its shareholders and the
market in general informed about the progress of
the Relisting of the ADR Program.
Santiago, July 24, 2024
Others
In accordance with article 9 and second paragraph of
article 10 of Law No. 18,045 and with General Rule
No. 30, both of the Financial Market Commission,
duly empowered to this effect, I inform the following
Material Fact regarding LATAM Airlines Group S.A.
(“LATAM” or the “Company”):
⚫ In a meeting held on this date, the Board of Directors
of the Company approved that the reopening and
relisting of its ADR program on the New York Stock
Exchange becomes effective as of July 25, 2024.
⚫ On the date hereof, the shareholders who requested
the first secondary sale under the registration rights
agreement (the “First Secondary Sale under the RRA”)
have agreed with the banks acting as underwriters
thereunder, that the price of such secondary sale
be US$24 per ADR. Given that each ADR represents
2,000 shares of the Company due to the ratio change
announced in the material fact dated July 18, 2024,
this results in a price per share of US$0.012.
⚫ On this date, the respective underwriting agreement
has been signed between (i) the Company, (ii) the
selling shareholders, and (iii) Goldman Sachs & Co.
LLC, Barclays Capital Inc., and J.P. Morgan Securities
LLC, acting as global coordinators, placement agents
and representatives of the other underwriters of
this secondary sale (i.e., Citigroup Global Markets
Inc., Santander US Capital Markets LLC, Deutsche
Bank Securities Inc., BNP Paribas Securities Corp.,
MUFG Securities Americas Inc., Natixis Securities
Americas LLC, LarrainVial Securities US, LLC and
Morgan Stanley & Co. LLC).
⚫ The First Secondary Sale under the RRA was
ultimately for 19,000,000 ADRs of the Company,
and payment for the same will be made on July
26, 2024. The sellers in this transaction will be the
shareholders to be set forth in the filings that will be
made with the SEC, which are listed in the attached
Annex.
Santiago, August 8, 2024
Others
In accordance with article 9 and second paragraph of
article 10 of Law No. 18,045 and General Rule No.
30, duly authorized for this purpose, I inform you of
the following Material Fact regarding LATAM Airlines
Group S.A. (“LATAM", the “Company”):
⚫ With this date and in accordance with the
requirements of General Rule No. 501 issued by the
Financial Market Commission, with the favorable
ruling of the Committee of Directors, the Board of
Directors of LATAM as of today agreed to amend
the regular operations policy of LATAM (the “LATAM
Regular Operations Policy”), which accordingly to the
referred rule, will become applicable from September
1, 2024.
⚫ The full and updated text of the LATAM Regular
Operations Policy is published on the Company's
website, under section Governance Guidelines in the
Governance section(https://www.latamairlinesgroup.net/
static-files/5492388e-8342-4fbc-8a0c9adab3116c49).
Likewise, copies of the policy are available to interested
parties at the Company's offices, located at Avenida
Presidente Riesco N°5711, floor 20, commune of Las
Condes, Santiago.
Santiago, October 1, 2024
Security issuances on international and/or
national markets
In accordance with Article 9 and second paragraph of
Article 10 of Law No. 18,045 and with General Rule
No. 30, duly authorized for this purpose, I inform
you of the following Material Fact with respect to
LATAM Airlines Group S.A. ("LATAM", the "Company"
or the "Company"):
On this date, the Company has agreed to place
in the international markets, secured bonds for
US$1,400 million, at an annual interest rate of 7.875%
maturing in 2030 (the "US Notes"), under Rule 144-
A and Regulation S of the Securities and Exchange
Commission of the United States of America, under
the Securities Act of 1933, of the United States
of America (the "U.S. Securities Act"). Given the
prevailing market conditions, the Company resolved
to issue bonds for the amount described, which is
US$200 million more than the amount informed on
September 26, 2024.
The proceeds obtained from the US Notes, together
with the use of US$200 million in cash (which is
US$200 million less than the amount informed on
September 26, 2024), will be used for the payment
and extinguishment of LATAM's obligations under
the bonds for a total amount of US$450 million,
which have a scheduled maturity date in 2027 (the
“2027 Bonds”) and a coupon of 13.375%, and the
term financing in the amount of US$1,081 million
maturing in 2027 (the “2027 Term Financing”),
with a coupon of SOFR + 965 bps, equivalent to
approximately 15%, contemplated as part of the
Company's Chapter 11 Proceeding exit financing (the
"Exit Financing"), as well as the termination and/
or modification of the documents granted under
the Exit Financing, as necessary, to implement the
foregoing. Any remaining funds from the US Notes,
along with LATAM's current cash reserves, will be
used for working capital and other general corporate
purposes.
LATAM
GROUP
2024
› 238
12 / ANNEXES
As a consequence of the foregoing, and in accordance
with Circular N° 988 dated January 16, 1991, issued
by your Commission, the Company estimates annual
savings in interest payments of approximately US$83
million and a one-time impact on the Company’s
Income Statement of approximately US$134 million,
of which US$45 will affect cash flow during the fourth
quarter of the current year.
The US Notes will essentially be secured and share
the same collateral package currently contemplated
under the Exit Financing. However, in the event that
the bonds maturing in 2029 are refinanced, the
Company will have the option to release part of the
collateral related to the cargo business and other
guarantees associated with this same business.
The US Notes have been sold to qualified institutional
buyers in the United States in accordance with US
Securities Law and have not been registered under
the Securities Act or the securities laws of any state
or other jurisdiction.
Santiago, October 15, 2024
Others
In accordance with Article 9 and second paragraph
of Article 10 of Law No. 18,045 and with General
Rule No. 30 and Circular No. 1,072 of May 14, 1992,
both of the Financial Market Commission (the
“Commission”), the undersigned, duly authorized for
this purpose, hereby informs you of the following
Material Fact with respect to LATAM Airlines Group
S.A. (“LATAM”, the “Company” or the “Company”):
As previously reported, by means of a Material Fact
dated October 1st, 2024, on this date, the Company
has issued and placed placed in the international
markets, secured notes for US$1,400 million, at
an annual interest rate of 7.875% maturing in 2030
(the “US Notes”), under Rule 144-A and Regulation
S of the Securities and Exchange Commission of the
United States of America, under the Securities Act
of 1933, of the United States of America (the “US
Securities Act”).
Using the proceeds from the US Notes and an additional
US$200 million in cash, LATAM paid and extinguished
its obligations under the US$450 million notes, which
had a scheduled maturity date in 2027 (the “2027
Notes”) and a coupon of 13.375%, along with the term
financing in the amount US$1,081 million, maturing
in 2027 (the “2027 Term Financing”), with a coupon
of SOFR + 965 bps, equivalent to approximately 15%,
all contemplated as part of the Company’s Chapter
11 Proceeding exit financing (the “Exit Financing”).
If any, the remaining proceeds from the US Notes
and cash reserves currently held by LATAM will be
required to be used for working capital and other
general corporate purposes.
As a consequence of the foregoing, and in accordance
with Circular No. 988 dated January 16, 1991, issued
by your Commission, the Company estimates annual
savings in interest payments of approximately US$83
million and a one-time impact on the Company’s
Income Statement of approximately US$134 million,
of which US$45 will affect cash flow during the fourth
quarter of the current year.
The US Notes will essentially be secured and share
the same collateral package currently contemplated
under the Exit Financing. However, in the event that
the notes maturing in 2029, also issued in the context
of the Exit Financing, are refinanced, the Company
will have the option to release part of the collateral
related to the cargo business.
The US Notes have been sold to qualified institutional
buyers in the United States in accordance with US
Securities Act and have not been registered under
the Securities Act or the securities laws of any
state or other jurisdiction. The form required by
the aforementioned Circular No. 1,072 is attached
hereto.
RISK FACTORS
NCG 519: 3.6 RISK FACTORS
GRI 3-3
The following risk factors, and those important risk
factors described in other reports we submit to or
file with the Securities and Exchange Commission
(“SEC”), could affect our actual results and could
cause our actual results to differ materially from
those expressed in any forward-looking statements
made by us or on our behalf.
In order to assess the risks outlined in the risk factors,
we have a comprehensive risk model that encompasses
various aspects of our business and it is reviewed
quarterly. This risk model serves as a framework
to identify, assess and mitigate potential risks that
may impact our organization. We understand that
risk landscapes evolve, and therefore, we conduct
continuous reviews of our risk model to ensure its
relevance and effectiveness in addressing emerging
risks.
In particular, as we are a non-U.S. company, there
are risks associated with investing in our ADSs that
are not typical for investments in the shares of U.S.
companies. Prior to making an investment decision,
you should carefully consider all of the information
contained in this document, including those described
below.
Risk factors summary
The following is a summary of the principal risks
that could adversely affect our business, operations
and financial results.
Risks Relating to our Business
⚫ High levels of competition in the airline industry
and the consolidation or mergers of competitors
in the markets in which the group operates, may
adversely affect the level of operations.
⚫ Some of our competitors may receive external
support, which could adversely impact our competitive
position.
⚫ The group’s business and results of operations
may be adversely affected if we fail to obtain and
maintain routes, suitable airport access, slots and
other operating permits.
⚫ It cannot be assured that in the future we will
have access to adequate facilities and landing rights
necessary to achieve our expansion plans.
⚫ The group depends on strategic alliances,
commercial relationships and regulatory approvals
for international strategic growth, and its business
LATAM
GROUP
2024
› 239
12 / ANNEXES
could be adversely affected if any of these are
disrupted or unattainable.
⚫ A failure to successfully implement the group’s
strategy or a failure to adjust such strategy to the
current economic situation would harm the group’s
business.
⚫ LATAM group may experience difficulty finding,
training and retaining employees, which can lead
to increased costs and impair our ability to execute
strategy and implement operational initiatives.
⚫ If we lose senior management and other key
employees and they are not replaced by individuals
with comparable skills, or we otherwise fail to maintain
our Company's culture, our business and results of
operations could be materially adversely affected.
⚫ Our business may experience adverse consequences
due to collective action by LATAM group employees
or third-party employees, including disruptions from
strikes or other labor-related actions.
⚫ We rely on maintaining a high aircraft utilization
rate to increase our revenues and absorb our fixed
costs, which makes us especially vulnerable to delays.
⚫ Our operations are subject to fluctuations in the
supply and cost of jet fuel, which could adversely
impact our business.
⚫ We are exposed to increases in landing fees and
other airport service charges that could adversely
affect our margins and competitive position.
⚫ A significant portion of our cargo revenue comes
from relatively few product types and may be
impacted by events affecting their production, trade
or demand.
⚫ An accumulation of ticket refunds could have an
adverse effect on our financial results.
⚫ If we are unable to incorporate leased aircraft,
including both operating leases and financial leases,
into the fleet at acceptable rates and terms in the
future, our business could be adversely affected.
⚫ Increases in insurance costs and/or significant
reductions in coverage could harm our financial
condition and results of operations.
⚫ Increases in our labor costs, which constitute a
substantial portion of our total operating expenses,
could directly impact our earnings.
⚫ We face reputational risks related to the use of
social media.
⚫ We face reputational risks related to misinformation
and disinformation.
Safety & Operational Risks
⚫ We depend on a limited number of suppliers for
certain aircraft and engine parts. LATAM group flies
and depends on Airbus and Boeing aircraft, and our
business could be adversely affected if we do not
receive timely deliveries of aircraft, if aircraft from
these suppliers become unavailable or if the public
develops a negative perception of the aircraft we
use in our operations.
⚫ Problems with air traffic control systems or other
technical failures could interrupt our operations and
have a material adverse effect on our business.
⚫ Losses and liabilities in the event of an accident
involving one or more of our aircraft could materially
affect our business.
⚫ Prolonged technical and operational issues with
the airport infrastructure in cities where we have a
significant presence may have a material adverse
effect on our operations.
⚫ Our business may be adversely affected by a
downturn in the airline industry caused by exogenous
events that affect travel behavior or increase costs,
such as outbreak of disease, weather conditions and
natural disasters, war or terrorist attacks.
⚫ The impacts of a pandemic and the efforts to
mitigate the spread of a virus may adversely impact
the group’s business, operations and financial results.
⚫ Disruptions or security breaches of our information
technology infrastructure or systems could interfere
with the operations, compromise passenger or employee
information, and expose us to liability, which may
adversely affect our business and reputation.
Risks Relating to the Airline Industry and the
Countries in Which the Group Operates
⚫ Because our performance is heavily dependent on
economic conditions in the countries in which the
group does business, negative economic conditions
in those countries could adversely impact the group’s
business and results of operations.
⚫ Latin American governments have exercised and
continue to exercise significant influence over their
economies.
⚫ Political instability and social unrest in Latin
America may adversely affect our business.
⚫ Because our business relies extensively on third-party
service providers, failure of these parties to perform
as expected, or interruptions in our relationships
with these providers or in their provision of services
to us, could have an adverse effect on our financial
position and results of operations.
⚫ Our financial results are exposed to foreign currency
fluctuations.
Environmental and Regulatory Risks
⚫ Our operations are subject to local, national
and international environmental regulations; costs
of compliance with applicable regulations, or the
consequences of noncompliance, could adversely
affect our results, our business or our reputation.
⚫ Our business may be adversely affected by the
consequences of climate change.
⚫ The business is highly regulated and changes in
the regulatory environment in the different countries
may adversely affect our business and results of
operations.
⚫ We are subject to anti-corruption, anti-bribery,
anti-money laundering and antitrust laws and
regulations in Chile, Brazil, Peru, the United States
and in the various other countries in which we operate.
LATAM
GROUP
2024
› 240
12 / ANNEXES
⚫ Violations of any such laws or regulations could
have a material adverse impact on our reputation,
results of operations and financial condition.
⚫ We are subject to risks relating to litigation and
administrative proceedings that could adversely
affect our business and financial performance in the
event of an unfavorable ruling.
⚫ Rapid technological advancements and digitalization
could generate risks in implementation and regulatory
control.
⚫ Our reputation and brand could be adversely
impacted if we fail to make progress towards achieving
our environmental sustainability goals.
Risks Related to our Indebtedness
⚫ We have substantial liquidity needs and continue
to pursue various financing options. Our business
may be adversely affected if we are unable to service
our debt or meet our future financing requirements.
⚫ We have significant exposure to SOFR and other
floating interest rates; increases in interest rates will
increase our financing cost and may have adverse
effects on our financial condition and results of
operations.
⚫ Our debt agreements contain various affirmative,
negative and financial covenants, which could limit our
ability to conduct our business. A breach of certain
negative covenants could also trigger an event of
default and acceleration of our indebtedness.
Risks Relating to our Common shares and ADRs
⚫ Our major shareholders may have interests that
differ from those of ADSs holders.
⚫ The market perception of a secondary offering
could create downward pressure on the market price
of our common shares and ADRs.
⚫ Holders of ADSs may be adversely affected by
their limited voting rights.
⚫ Holders of ADSs may be adversely affected
by currency devaluations and foreign exchange
fluctuations.
⚫ Future changes in Chilean foreign investment
controls and withholding taxes could negatively affect
non-Chilean residents that invest in our shares.
⚫ Our ADS holders may not be able to exercise
preemptive rights in certain circumstances.
⚫ We are not required to disclose as much information
to investors as a U.S. issuer is required to disclose
and, as a result, you may receive less information
about us than you would receive from a comparable
U.S. company.
Risks relating to our business
High levels of competition in the airline industry
and the consolidation or mergers of competitors
in the markets in which the group operates, may
adversely affect the level of operations.
Our business, financial condition and results of
operations could be adversely affected by high
levels of competition within the industry, particularly
the entrance of new competitors into the markets
in which the group operates, and the potential
implementation of aggressive pricing strategies by
competitors. Airlines compete primarily over fare
levels, frequency and dependability of service, brand
recognition, passenger amenities (such as frequent
flyer programs) and the availability and convenience
of other passenger or cargo services. New and existing
airlines (and companies providing ground cargo or
passenger transportation) could enter our markets
and compete with us on any of these bases, including
by offering lower prices, more attractive services or
increasing their route offerings in an effort to gain
greater market share. For more information regarding
our main competitors, see “Item 4. Information of
the Company—Business Overview—Passenger
Operations-International Passenger Operations” and
“Item 4. Information of the Company—Business
Overview—Passenger Operations—Business Model
for Domestic Operations.”
Low-cost carriers have an important impact on the
industry’s revenues given their low unit costs. Lower
costs allow low-cost carriers to offer inexpensive
fares which, in turn, allow price-sensitive customers
to fly or to shift from legacy carriers to low-cost
carriers. In past years, we have seen interest in the
development of the low-cost model throughout Latin
America. For example, Sky Airline and JetSmart
are main competitors in the Chilean and Peruvian
markets and both have low-cost business models.
In 2024, JetSmart further expanded its footprint
in the region by entering the domestic market in
Colombia, a step forward in its growth strategy, and
intensifying competition with local carriers. Avianca
has also adapted its business model by incorporating
elements of a low-cost carrier, while retaining its
network, loyalty program and strategic partnerships.
Additionally, some airlines have pursued strategies
of consolidation through alliances or mergers with
legacy carriers. Examples include the creation of Abra
Group (a partnership between Avianca and Gol), the
American Airlines acquisition of a minority stake in
JetSmart in December 2022, and the recent signing
of a non-binding memorandum of understanding
between Abra Group and Azul to explore a potential
merger.
In the cargo business, companies such as Maersk, CMA
CGM, and MSC have expanded into air transportation,
partly due to the COVID-19 pandemic and the
scarcity of containers. CMA CGM and Air France-
KLM officially launched their long-term strategic
air cargo partnership in April 2023, combining
their complementary cargo networks and freighter
capacity. However, this partnership was terminated
by mutual agreement in January 2024, without
changes to CMA CGM’s 9% stake in Air France-KLM.
Additionally, MSC Air Cargo commenced operations
in December 2022, with flights operated by Atlas
Air. These consolidations, mergers, or new alliances
might continue to appear, increasing the concentration
and levels of competition.
Moreover, as a result of the competitive environment,
there may be further consolidation in the Latin
American and global airline industry, whether by
means of acquisitions, joint ventures, partnerships or
strategic alliances. We cannot predict the effects of
further consolidation on the industry. Furthermore,
consolidation in the airline industry and changes
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in international alliances will continue to affect the
competitive landscape in the industry and may
result in the development of airlines and alliances
with increased financial resources, more extensive
global networks and reduced cost structures.
Some of our competitors may receive external
support, which could adversely impact our competitive
position.
Some of our competitors may receive support from
external sources, such as their national governments,
which may be unavailable to us. Support may include,
among others, subsidies, financial aid or tax waivers.
This support could place the group at a competitive
disadvantage and adversely affect operations and
financial performance. For example, Aerolineas
Argentinas has historically been government subsidized.
Additionally, during the COVID-19 pandemic, some
competitors on long-haul routes (such as American
Airlines, Delta Air Lines, Southwest, United and
Airfrance-KLM) received government support. More
recently, in January 2025, Azul and Gol entered into
agreements with the Brazilian government to reduce
their tax debts by approximately 42%. This support
could place us at a competitive disadvantage and
adversely affect our business, financial condition
and results of operations
The group’s business and results of operations
may be adversely affected if we fail to obtain and
maintain routes, suitable airport access, slots and
other operating permits.
LATAM group’s business depends upon our access to
key routes and airports. Bilateral aviation agreements
between countries, open skies laws and local aviation
approvals frequently involve political and other
considerations outside of our control. The group’s
operations could be constrained by any delay or
inability to gain access to key routes or airports,
including:
⚫ limitations on our ability to transport more
passengers;
⚫ the imposition of flight capacity restrictions;
⚫ the inability to secure or maintain route rights in
local markets or under bilateral agreements; or
⚫ the inability to maintain our existing slots and
obtain additional slots.
The group operates numerous international routes
subject to bilateral agreements, as well as domestic
flights within Chile, Peru, Brazil, Ecuador and Colombia,
subject to local route and airport access approvals.
See “Item 4. Information on the Company—Business
Overview—Regulation.”
There can be no assurance that existing bilateral
agreements with the countries in which the group’s
companies are based and permits from foreign
governments will continue to be in effect. A modification,
suspension or revocation of one or more bilateral
agreements could have a material adverse effect
on our business, financial condition and results of
operations. The suspension of our permission to
operate at certain airports, destinations or slots, or
the imposition of other sanctions could also have a
material adverse effect on our business. A change in
the administration of current laws and regulations
or the adoption of new laws and regulations in any
of the countries in which the group operates that
restrict our routes, airports or other access may have
a material adverse effect on our business, financial
condition and results of operations.
It cannot be assured that in the future we will have
access to adequate facilities and landing rights
necessary to achieve our expansion plans.
Certain airports that we currently serve or plan to
serve in the future may have capacity constraints
and impose various restrictions. These restrictions
include limitations on takeoff and landing slots
during specific periods of the day and restrictions
on aircraft noise levels. We cannot guarantee that
our group will be able to secure an adequate number
of slots, gates, and other facilities at airports to
expand our services in line with our growth strategy.
Additionally, airports that are currently not subject
to capacity constraints may face such constraints
in the future.
Furthermore, airlines must use their slots regularly and
promptly, or they risk losing them to other carriers.
If slots or other airport resources are unavailable
or restricted in any way, we may need to modify
schedules, alter routes, or reduce aircraft utilization.
It is also possible that aviation authorities in the
countries where our group operates may change
the rules for assigning takeoff and landing slots. An
example of this is the São Paulo airport (Congonhas),
where slots previously operated by Avianca Brazil
were reassigned primarily to Azul in 2019, after the
Agência Nacional de Aviação Civil in Brazil (ANAC)
approved new rules for slot distribution. Likewise, on
June 7, 2022, ANAC passed Resolution No. 682, by
which the ANAC approved new regulation for airport
coordination and defined the rules for allocating
and monitoring the use of airport infrastructure
through the use of slots (e.g., coordination of arrival
and departure times) at coordinated airports. It also
updated the parameters applicable to the airports
of Congonhas, Guarulhos (Governador André Franco
Montoro International Airport), Rio de Janeiro (Santos
Dumont Airport), Recife (Gilberto Freyre International
Airport) and Pampulha (Carlos Drummond de Andrade
Airport). The occurrence of any of these scenarios
involving LATAM group operations could have a
negative financial impact on our business.
In October 2023, LATAM and JetSmart disputed the
allocation of frequencies on the Santiago to Lima
route. During a public bidding process conducted by
the Chilean Junta de Aeronáutica Civil (JAC), LATAM
secured 10 out of 13 available frequencies, while
Sky Airline obtained the remaining three. JetSmart,
which previously operated 14 frequencies on this
route, lost nine of them in the bidding. JetSmart
criticized the process, arguing that the allocation
favored airlines with dominant market positions and
raised concerns about potential frequency hoarding.
In response, LATAM contended that JetSmart’s failure
to secure frequencies was due to its own strategic
choices and not the bidding mechanism. The dispute
was brought by JetSmart to the Tribunal de Defensa
de la Libre Competencia (Chilean Antitrust Court or
“TDLC” by its Spanish name), which, in January 2025,
concluded that the bidding process did not violate
antitrust laws and adhered to existing regulations.
Moreover, we cannot guarantee that airports without
current restrictions will not implement restrictions
in the future, or that existing restrictions will not
become more burdensome. These restrictions may
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limit our ability to continue providing services or
expanding our operations at these airports.
The group depends on strategic alliances, commercial
relationships and regulatory approvals for international
strategic growth, and its business could be adversely
affected if any of these are disrupted or unattainable.
LATAM and its affiliates maintain numerous alliances
and commercial relationships across the jurisdictions
in which they operate. These partnerships enable the
group to enhance its network and offer customers
services that might otherwise be unavailable. However,
if any of these alliances or relationships deteriorate,
are terminated, or fail to provide the anticipated
benefits, the group’s business, financial condition,
and results of operations could be adversely affected.
Furthermore, the group’s international strategic
growth plans rely, in part, on receiving regulatory
approvals in the countries where it seeks to expand
operations through joint business agreements. There
is a risk that the group may not obtain necessary
approvals, while competitors might, allowing them
to compete for key routes and potentially erode the
group’s market share. This could adversely impact
the group’s ability to achieve its growth objectives
and financial results. No assurances can be given
regarding the benefits, if any, that might be derived
from such agreements.
A failure to successfully implement the group’s
strategy or a failure to adjust such strategy to the
current economic situation would harm the group’s
business.
We have developed a strategic plan centered on
connecting Latin America with itself and the world
through a network of passenger and cargo transportation.
Our strategy is built on delivering unmatched
customer experiences, fostering sustainability and
driving innovation, all while maintaining a balance
between economic growth, operational efficiency,
environmental care and social well-being.
To achieve these goals, we focus on offering a wide
route network that combines competitive pricing
with seamless connectivity across the Americas
and beyond. Our approach integrates passenger
segmentation and personalized services, ensuring
accessibility for a broader audience while meeting
the expectations of premium customers. Customer
satisfaction remains at the core of our efforts,
supported by cutting-edge digital solutions that
create a safe and reliable travel experience.
Moreover, we are committed to sustainability and
social responsibility, integrating environmental and
social practices into our operations. We lead efforts
in environmental management, climate change
and circular economy, ensuring a positive impact
on the regions we serve. We have been recognized
globally, including our inclusion in the Dow Jones
Sustainability Index.
Difficulties in implementing our strategy may adversely
affect the group’s business and results of operation.
LATAM group may experience difficulty finding,
training and retaining employees, which can lead
to increased costs and impair our ability to execute
strategy and implement operational initiatives.
The airline industry is labor intensive. We employ a
large number of pilots, flight attendants, maintenance
technicians and other operating and administrative
personnel, such as specialized technology personnel.
The airline industry has, from time to time, experienced
a shortage of qualified personnel, especially pilots
and maintenance technicians, which has somewhat
intensified during the recovery phase of air traffic
following the peak of the pandemic. Should turnover
of employees, particularly pilots and maintenance
technicians, sharply increase, our training costs will
be significantly higher. LATAM group cannot assure
that it will be able to recruit, train and retain the
managers, pilots, technicians and other qualified
employees that are needed to continue the current
operations or replace departing employees. An
increase in turnover or failure to recruit, train and
retain qualified employees at a reasonable cost could
materially adversely affect the business, financial
condition and results of operations. A loss of key
personnel or material erosion of employee morale
could impair the ability to execute strategy and
implement operational initiatives, thereby adversely
affecting the group.
If we lose senior management and other key
employees and they are not replaced by individuals
with comparable skills, or we otherwise fail to
maintain our Company’s culture, our business and
results of operations could be materially adversely
affected.
We are dependent on the experience and industry
knowledge of our officers and other key employees
to design and execute our business plans. If we
experience a substantial turnover in our leadership
and other key employees, and we are not able
to replace these persons with individuals with
comparable skills, or we otherwise fail to maintain
our Company’s culture, our performance could be
materially adversely impacted. Furthermore, we may
be unable to attract and retain additional qualified
senior management and other key personnel as
needed in the future.
Our business may experience adverse consequences
due to collective action by LATAM group employees
or third-party employees, including disruptions
from strikes or other labor-related actions.
As of December 31, 2024, approximately 46% of the
group’s employees, including administrative personnel,
cabin crew, flight attendants, pilots and maintenance
technicians are members of unions and have contracts
and collective bargaining agreements which expire on
a regular basis. The business, financial condition and
results of operations could be materially adversely
affected by a failure to reach agreement with any
labor union representing such employees or by an
agreement with a labor union that contains terms
that are not in line with expectations or that prevent
the group from competing effectively with other
airlines. For further information regarding the unions
representing employees in each country in which
the group operates and where we have established
collective bargaining agreements, see “Item 6.
Directors, Senior Management and Employees—
Employees—Labor Relations.”
Certain employee groups such as pilots, flight
attendants, mechanics and our airport personnel
have highly specialized skills. As a consequence,
actions by these groups, such as strikes, walk-outs
or stoppages, could severely disrupt operations
and adversely impact our operating and financial
performance, as well as our image.
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A strike, work interruption or stoppage, or any prolonged
dispute with employees who are represented by any
of these unions could have an adverse impact on
operations. These risks are typically exacerbated
during periods of renegotiation with the unions, which
typically occurs every two to four years depending
on the jurisdiction and the union.
Any renegotiated collective bargaining agreement
could feature significant wage increases and a
consequent increase in our operating expenses. Any
failure to reach an agreement during negotiations
with unions may require us to enter into arbitration
proceedings, use financial and management resources,
and potentially agree to terms that are less favorable
to us than our existing agreements. Employees who
are not currently members of unions may also form
new unions that may seek further wage increases
or benefits.
In addition to actions by LATAM group employees,
labor disputes involving third-party employees could
also impact our operations. For instance:
On September 12, 2024, workers at Santiago’s
Arturo Merino Benítez International Airport in Chile
initiated a strike following failed negotiations with
the airport’s concessionaire, Nuevo Pudahuel. The
strike lasted one day, and workers mainly requested
salary adjustments and increased meal allowances.
The workers and Nuevo Pudahuel were able to reach
an agreement on the following day.
On October 9, 2024, air traffic controllers employed
by NAV Brasil planned a nationwide strike to demand
an 8.5% salary adjustment. Although the strike was
scheduled to last one day, it was cancelled after a
judicial ruling from the Superior Labor Court, which
imposed heavy fines for any disruptions. The incident
intensified labor tensions within the Brazilian aviation
sector.
On November 15, 2024, Chile’s Dirección General
de Aviación Civil (“DGAC”) employees initiated an
indefinite nationwide strike over unpaid bonuses.
The strike lasted three days before negotiations
resumed, causing widespread delays and cancellations
across Chilean airports. The disruption significantly
impacted flight operations and emphasized ongoing
labor disputes in the region.
While LATAM group has established protocols to manage
these types of situations, there is no guarantee that
we will always be able to reach mutually beneficial
agreements in future disputes with employees,
unions or third parties. Any prolonged disputes or
disruptions could materially affect our operations,
financial performance and market position.
We rely on maintaining a high aircraft utilization rate
to increase our revenues and absorb our fixed costs,
which makes us especially vulnerable to delays.
Generally, a key element of our strategy is to
maintain a high daily aircraft utilization rate, which
measures the number of hours we use our aircraft
per day. High daily aircraft utilization allows us to
maximize the amount of revenue we generate from
our aircraft and absorb the fixed costs associated
with our fleet and is achieved, in part, by reducing
turnaround times at airports and developing schedules
that enable us to increase the average hours flown
per day. Our rate of aircraft utilization could be
adversely affected by a number of different factors
that are beyond our control, including air traffic and
airport congestion, adverse weather conditions,
unanticipated maintenance and delays by third-
party service providers relating to matters such as
fueling, catering and ground handling. If aircraft fall
behind schedule, the resulting delays could cause a
disruption in our operating performance and have a
financial impact on our results.
Our operations are subject to fluctuations in the
supply and cost of jet fuel, which could adversely
impact our business.
Higher jet fuel prices could have a materially adverse
effect on our business, financial condition and
results of operations. Jet fuel costs have historically
accounted for a significant amount of our operating
expenses, and accounted for 34.5% of our total costs
of sales in 2024. For additional information, see “Item
11. Quantitative and Qualitative Disclosures about
Market Risk—Risk of Fluctuations in Fuel Prices.”
Both the cost and availability of fuel are subject
to many economic and political factors and events
that we can neither control nor predict, including
international political and economic circumstances
such as the political instability in major oil-exporting
countries.
Any fuel supply shortage, could result in higher fuel
prices or reductions in scheduled airline services.
In August 2024, an electrical failure at Ecopetrol
(Colombia’s state-owned company) refinery in
Cartagena caused a significant aviation fuel shortage.
This specific event led to operational challenges,
including flight cancellations at major airports, as
airlines struggled to manage the reduced supply.
Ecopetrol implemented contingency measures to
address this shortage, including importing aviation
fuel, but supply constraints persisted for weeks,
underscoring the vulnerability of airline operations
to such disruptions.
Other factors, such as production shortfalls by the
Organization of the Petroleum Exporting Countries
(“OPEC”), disruptions from severe weather or natural
disasters, labor actions (e.g., the 2018 trucking strike
in Brazil), or geopolitical conflicts like the unrest
in the Middle East or the conflict in Ukraine, could
similarly impact fuel prices and availability.
We cannot ensure that we would be able to offset
any increases in the price of fuel. Additionally,
lower fuel prices may result in lower fares through
the reduction or elimination of fuel surcharges. We
have entered into fuel hedging arrangements, but
there can be no assurance that such arrangements
will be adequate to protect us from an increase in
fuel prices in the near future or in the long term. See
“Item 11. Quantitative and Qualitative Disclosures
About Market Risk—Risk of Fluctuations in Fuel
Prices.”
We are exposed to increases in landing fees and
other airport service charges that could adversely
affect our margins and competitive position.
The group must pay fees to airport operators for
the use of their facilities. Any substantial increase in
airport charges, including at Guarulhos International
Airport in São Paulo, Jorge Chavez International
Airport in Lima or Comodoro Arturo Merino Benitez
International Airport in Santiago, among others,
could have a material adverse impact on our results
of operations. Passenger taxes and airport charges
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have increased substantially in recent years. We
cannot assure that the airports in which the group
operates will not increase or maintain high passenger
taxes and service charges in the future. Any such
increases could have an adverse effect on our financial
condition and results of operations.
A significant portion of our cargo revenue comes
from relatively few product types and may be
impacted by events affecting their production,
trade or demand.
The group’s cargo demand, especially from Latin
American exporters, is concentrated in a small
number of product categories, such as exports of
fish, shell fish and fruit from Chile, asparagus from
Peru and fresh flowers from Ecuador and Colombia.
Similarly, import markets play a key role in our
cargo operations, with demand for products such as
manufactured goods, auto parts, pharmaceuticals
and technology equipment driving inbound cargo
traffic into Latin America.
Events that adversely affect the production, trade
or demand for these goods may adversely affect the
volume of goods that are transported and may have
a significant impact on the results of operations.
Future trade protection measures by or against
the countries for which we provide cargo services
may have an impact on cargo traffic volumes and
adversely affect our financial results. Some of the
cargo products are sensitive to foreign exchange rates
and, therefore, traffic volumes could be impacted by
the appreciation or depreciation of local currencies.
An accumulation of ticket refunds could have an
adverse effect on our financial results.
If the group is required to pay out a substantial
amount of ticket refunds in cash, this could have an
adverse effect on our financial results or liquidity
position. Furthermore, LATAM has agreements
with financial institutions that process customer
credit card transactions for the sale of air travel and
other services. Under certain of LATAM’s credit card
processing agreements, the financial institutions
in certain circumstances have the right to require
that LATAM maintain a reserve equal to a portion
of advance ticket sales that have been processed by
that financial institution, but for which LATAM has
not yet provided the service (i.e., air transportation).
Such financial institutions may require cash or other
collateral reserves to be established or withholding
of payments related to receivables to be collected.
Refunds lower our liquidity and put us at risk of
triggering liquidity covenants in these processing
agreements and, in doing so, could force us to post
cash collateral with the credit card companies for
advance ticket sales.
If we are unable to incorporate leased aircraft,
including both operating leases and financial leases,
into the fleet at acceptable rates and terms in the
future, our business could be adversely affected.
A large portion of the aircraft fleet is subject to
long-term leases, including operating leases and
financial leases. These leases typically run from 8
to 12 years from the date of execution. We may
face more competition for, or a limited supply of
leased aircraft, making it difficult to negotiate on
competitive terms upon expiration of the current
leases or to lease additional capacity required for the
targeted level of operations. If we are forced to pay
higher lease rates, whether for operating or financial
leases, in the future to maintain our capacity and
the number of aircraft in the fleet, our profitability
could be adversely affected.
Increases in insurance costs and/or significant
reductions in coverage could harm our financial
condition and results of operations.
Significant events affecting the aviation insurance
industry (such as terrorist attacks, airline crashes
or accidents, and health epidemics and the related
widespread government-imposed travel restrictions)
may result in significant increases of airlines’ insurance
premiums and/or relevant decreases of insurance
coverage. Further increases in insurance costs and/
or reductions in available insurance coverage could
have a material impact on our financial results,
change the insurance strategy, and also increase
the risk of uncovered losses.
Increases in our labor costs, which constitute a
substantial portion of our total operating expenses,
could directly impact our earnings.
Labor costs constitute a significant percentage of our
total cost of sales (15.1% in 2024) and at times in
our operating history we have experienced pressure
to increase wages and benefits for our employees.
A significant increase in our labor costs could result
in a material reduction in our earnings.
We face reputational risks related to the use of
social media.
LATAM group frequently uses social media platforms
as marketing tools. These platforms provide LATAM
group, as well as individuals, with access to a broad
audience of consumers and other interested persons.
Negative commentary regarding LATAM group or
the products it sells may be posted on social media
platforms and similar devices at any time, and may
be adverse to LATAM group’s reputation or business.
Further, as laws, regulations, and different platforms’
terms of service rapidly evolve to govern the use
of social media, the failure by LATAM group, its
employees or third parties acting on LATAM group’s
behalf to abide by applicable laws and regulations
in the use of these platforms and devices could
adversely impact LATAM group’s business, financial
condition, and results of operations or subject it to
fines or other penalties.
We face reputational risks related to misinformation
and disinformation
The proliferation of false or misleading content
may be used as a mechanism to sow doubt among
the general public and tarnish the image of foreign
products and services. Misinformation or disinformation
regarding LATAM group or the services it offers, may
affect its reputation and customer relations. The
spread of false or malicious news could generate
negative perceptions regarding LATAM group’s
safety, service quality or environmental practices,
weakening consumer trust in the group’s operations.
Additionally, criticism amplified through social
media and digital platforms could harm the brand,
especially in sensitive markets or during specific
crises. Moreover, the spread of such information
could (i) create higher crisis management costs for
LATAM, as the group would need dedicated resources
to monitor and counteract misinformation in real
time, (ii) influence customer behavior, reducing
flight demand or affecting the preference for the
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group over competitors, and (iii) create tensions with
employees or unions, impacting the work environment
and hindering collective negotiations.
Safety & operational risks
We depend on a limited number of suppliers for
certain aircraft and engine parts. LATAM group flies
and depends on Airbus and Boeing aircraft, and our
business could be adversely affected if we do not
receive timely deliveries of aircraft, if aircraft from
these suppliers become unavailable or if the public
develops a negative perception of the aircraft we
use in our operations.
We depend on a limited number of suppliers for
aircraft, aircraft engines and many aircraft and engine
parts. As a result, we are vulnerable to problems
associated with the supply of those aircraft, parts
and engines, including design defects, mechanical
problems, contractual performance by the suppliers,
or adverse perception by the public that would
result in unscheduled maintenance requirements,
in customer avoidance or in actions by the aviation
authorities resulting in an inability to operate our
aircraft. During 2024, LATAM group’s main suppliers
were aircraft manufacturers Airbus and Boeing.
In addition to Airbus and Boeing, LATAM group has
a number of other suppliers, primarily related to
aircraft accessories, spare parts and components,
including Pratt & Whitney Canada, MTU Maintenance,
Rolls-Royce, General Electric Commercial Aviation
Services Ltd., General Electric Celma, General Electric
Engines Service, CMF International and Honeywell,
among others.
As of December 31, 2024, LATAM group had a total
fleet of 270 Airbus and 77 Boeing aircraft (4 of these
aircraft are non-current assets classified as held for
sale). Risks relating to Airbus and Boeing include:
⚫ our failure or inability to obtain Airbus or Boeing
aircraft, parts or related support services on a timely
basis because of high demand, aircraft delivery
backlog or other factors;
⚫ the interruption of fleet service as a result of
unscheduled or unanticipated maintenance requirements
for these aircraft;
⚫ the issuance by the Chilean or other aviation
authorities of directives restricting or prohibiting
the use of our Airbus or Boeing aircraft, or requiring
time-consuming inspections and maintenance;
⚫ adverse public perception of a manufacturer as a
result of safety concerns, negative publicity or other
problems, whether real or perceived, in the event of
an accident;
⚫ delays between the time we realize the need for
new aircraft and the time it takes us to arrange for
Airbus and Boeing or for a third-party provider to
deliver this aircraft; or
⚫ the delay, for any reason, to conclude cabin upgrade
projects that could result in aircraft unavailability
for a certain period of time.
The COVID-19 pandemic and its impact on the
aviation industry, along with the subsequent global
supply chain challenges faced by manufacturers
and distributors, resulted in a widespread shortage
of aircraft and delays in scheduled deliveries.
Consequently, the waiting period for obtaining new
aircraft as well as the time between a new order and
its delivery became longer, affecting both Airbus and
Boeing, as well as LATAM group.
On July 25, 2023, Pratt & Whitney disclosed a powder
metal contamination issue affecting PW1100 GTF
engines, which power Airbus Neo Family aircraft. As of
December 31, 2024, LATAM group reported 44 Airbus
Neo family aircraft within its fleet (approximately 13%
of the total fleet). The total number of AOG (Aircraft
on Ground) affecting LATAM group’s operations is
a fraction of this number and will depend on the
turnaround time of the shop inspection and engine
repair, and the level of cycles that the engines have.
These operational disruptions resulting from engine
shortages from Pratt & Whitney, along with potential
reductions in air traffic, could have an adverse effect
on our business, operational results and financial
condition. Our business could also be materially
adversely affected if the passengers avoid flying on
our aircraft due to an adverse perception of aircraft
manufacturing, whether because of safety concerns
or other problems, real or perceived, or in the event
of an accident involving such aircraft or its engines.
Additionally, during 2024 Rolls-Royce experienced
delays in the maintenance of the engines used for
the Boeing 787-9 aircraft. These delays intensified
the operational challenges faced by airlines, including
LATAM group, as they navigate the disruptions caused
by engine shortages.
As of December 31, 2024, LATAM has found support
from both Pratt & Whitney and Rolls-Royce, who,
together with the company, are exploring solutions
to the above mentioned mechanical difficulties.
While LATAM is currently addressing the above
mentioned mechanical difficulties with the support
from both Pratt & Whitney and Rolls-Royce, the
occurrence of any one or more of the above mentioned
factors could restrict our ability to use aircraft to
generate profits, respond to increased demands, or
could otherwise limit our operations and adversely
affect our business.
Problems with air traffic control systems or other
technical failures could interrupt our operations
and have a material adverse effect on our business.
The operations, including the ability to deliver customer
service, are dependent on the effective operation
of the equipment, including aircraft, maintenance
systems and reservation systems. The operations
are also dependent on the effective operation
of domestic and international air traffic control
systems and the air traffic control infrastructure
by the corresponding authorities in the markets
in which the group operates. Equipment failures,
personnel shortages, air traffic control problems and
other factors that could interrupt operations could
adversely affect our financial results as well as our
reputation.
Losses and liabilities in the event of an accident
involving one or more of our aircraft could materially
affect our business.
We are exposed to potential catastrophic losses in
the event of an aircraft accident, terrorist incident or
any other similar event. There can be no assurance
that, as a result of an aircraft accident or significant
incident:
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⚫ we will not need to increase our insurance coverage;
⚫ our insurance premiums will not increase significantly;
⚫ our insurance coverage will fully cover all of our
liabilities; and
⚫ we will not be forced to bear substantial losses.
Substantial claims resulting from an accident or
significant incident in excess of our related insurance
coverage could have a material adverse effect on
our business, financial condition and results of
operations. Moreover, any aircraft accident, even
when comprehensively insured, could cause the
negative public perception that our operations or
aircraft are less safe or reliable than those operated
by other airlines or by other flight operators, which
could have a material adverse effect on our business,
financial condition and results of operations.
On November 18, 2022, LATAM Airlines Peru reported
that during the take-off of flight LA 2213 at Lima’s
Jorge Chávez International Airport a fire truck entered
the runway while performing an emergency drill and
collided with its aircraft. Authorities subsequently
confirmed fatalities of three firefighters who were
in the fire truck that struck the aircraft. There were
no fatalities among the 102 passengers and 6 crew
members of the aircraft. According to the final report
of the Aviation Accidents Investigation Commission
(Comisión de Investigación de Accidentes de Aviación,
“CIAA”) issued in September 2023, this chain of
events was originated by the airport operator’s
inadequate planning and coordination, as well as the
failure to use the communication and International
Civil Aviation Organization (“ICAO”) standardized
phraseology. The aircraft damage from this event
was covered by LATAM’s insurance policies.
Similarly, on March 11, 2024, LATAM experienced
another incident involving flight LA800, which operated
from Sydney to Auckland. The Boeing 787-9 aircraft
encountered a severe technical difficulty approximately
an hour before landing, resulting in an abrupt drop in
altitude. This unexpected movement led to injuries
among ten passengers and three crew members.
There were no fatalities among the 263 passengers
and 9 crew members of the aircraft. The incident
was caused by a technical issue within the aircraft,
which a later investigation suggested was caused
by a flight attendant who might have inadvertently
activated a switch on a cockpit seat. The Company
has since been working closely with aviation safety
authorities to prevent future occurrences. LATAM’s
insurance policies covered the medical treatment
of the injured passengers and crew, and the repair
costs associated with the incident.
Prolonged technical and operational issues with
the airport infrastructure in cities where we have a
significant presence may have a material adverse
effect on our operations.
Our operations and growth strategy are dependent
on the facilities and infrastructure of key airports,
including Santiago’s International Airport, São Paulo’s
Guarulhos International and Congonhas Airports,
Brasilia’s International Airport, Bogota’s El Dorado
International Airport, and Lima’s Jorge Chavez
International Airport.
Santiago’s International Airport opened its new
International Terminal, called Terminal 2, at the end
of February 2022. The new terminal reduced assisted
check-in counters by 50%, which poses a challenge to
the airlines as it obligates them to implement self-
service models. Santiago’s International Airport has
made significant progress in its remodeling plans for
Terminal 1, which is being conducted in two phases
(east and west). During the initial phase of Terminal
1’s remodeling, LATAM effectively maintained and
concentrated operations in the east sector, utilizing the
existing facilities. In August 2024, the concessionaire
began the second phase of the remodeling, shifting
the entire operation of the national terminal to the
west sector. This transition has resulted in some
impacts on LATAM’s use of the facilities, causing
operational challenges, including longer processing
times for passengers. The entire remodeling project
for Terminal 1 is on track and is scheduled to be
completed by August 2025, as initially planned
The renovation and expansion of Iquique’s Diego
Aracena International Airport in Chile has been
successfully completed, significantly enhancing
its infrastructure. The modernization included the
expansion of the passenger terminal, upgrades to
boarding and disembarking areas and the installation
of state-of-the-art baggage handling systems.
Similarly, Arica’s Chacalluta International Airport
concluded its renovation in December 2024. The
project doubled the terminal’s size to 12,184 m² and
introduced improvements, such as the addition of
five boarding bridges, a new control tower, expanded
baggage claim areas, and additional airline counters.
In addition, there are four other ongoing projects in
Chile, primarily focused on expansion and renovation,
which are expected to be completed between 2025
and 2026: Balmaceda Airport, Calama Airport, La
Florida International Airport and Presidente Carlos
Ibáñez del Campo International Airport.
In Peru, the Jorge Chávez International Airport
in Lima continues to face challenges with limited
growth capacity on the airside infrastructure,
including the runway, apron and parking areas, as
well as overcrowding within the terminal. The airport
concessionaire is in the final stages of constructing
a second runway and a new terminal. While these
facilities were initially planned to be completed by
the end of January 2025, their opening has been
rescheduled for March 30, 2025. Any further delays
or limitations stemming from ongoing construction
could negatively impact our operations, hinder growth
potential, and affect our competitiveness both in
Peru and the broader region.
On the other hand, Jaén Airport and Jauja Airport
in Peru continue to face challenges due to runway
infrastructure issues, which previously led to
operational disruptions and flight cancellations. In
response, the Peruvian government initiated urgent
interventions in 2023 to address these concerns. At
Jaén Airport, operations were suspended several
times in 2023 due to poor runway conditions, leading
to the announcement of a rehabilitation schedule
for the runway and a terminal improvement project.
However, the works are still ongoing, and no official
completion date has been confirmed, leaving the
airport with limited operational capacity.
Similarly, at Jauja Airport, renovation and improvement
works for the runway were launched with the goal
of enhancing safety and accommodating larger
aircraft. The project is expected to be completed by
mid-2025, according to recent government updates.
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However, due to the deteriorated condition of the
runway, LATAM Airlines Peru indefinitely suspended
its operations to and from this airport in February
2025, citing safety concerns for passengers. Although
these efforts reflect the government’s commitment
to improving regional airports, delays and ongoing
construction continue to affect flight schedules and
connectivity in the region.
Brazilian airports, such as the Brasília and São Paulo
(Guarulhos) International Airports, have limited the
number of takeoff and landing slots per day due to
infrastructural limitations. Any condition that would
prevent or delay our access to airports or routes that
are vital to our strategy, or our ability to maintain
our existing slots and obtain additional slots, could
materially adversely affect our operations.
In 2022, under Brazil’s state government Airport
Concession Program, 15 airports were granted
new concessions. Among these, eight are operated
by LATAM group, including Congonhas Airport in
downtown São Paulo. The Concession Program
facilitates significant infrastructure investments but
also involves a substantial volume of simultaneous
work. Over the next five years, 29 of the 55 airports
operated by LATAM group in Brazil are scheduled
for infrastructure improvements, which may lead to
temporary restrictions and could affect our revenues.
In 2023, GRU Airport, the concessionaire of Guarulhos
Airport, commenced the final phase of its infrastructure
expansion after delays due to the COVID-19 pandemic.
The project includes building a new rapid exit taxiway
on the main runway and additional taxiways, as
well as plans for new piers and apron expansions.
Completion is expected between 2025 and 2029,
with additional investments of R$1.4 billion required
under the extended concession agreement approved
by the Federal Court of Accounts (“TCU”).
In 2024 the Brazilian government announced plans to
build or modernize 100 airports across the country
within the next five years. As of now, many of these
projects are in the planning or early construction
stages, with some renovations already underway.
While LATAM group is closely coordinating with and
supporting the airport concessionaires, any delays on
the completion of the ongoing remodeling or expansion
works of any of the airports indicated above would
materially adversely affect our operations.
Our business may be adversely affected by a downturn
in the airline industry caused by exogenous events
that affect travel behavior or increase costs, such as
outbreak of disease, weather conditions and natural
disasters, war or terrorist attacks.
Demand for air transportation may be adversely
impacted by exogenous events, such as epidemics
(such as Ebola and Zika) and pandemics (such as
the COVID-19 pandemic), terrorist attacks, war or
political and social instability. Increasing geopolitical
tensions and hostilities in connection with the conflict
in Ukraine, and in the Middle East, and the trade
and monetary sanctions that have been imposed in
connection with those developments, have affected,
and could significantly affect, worldwide oil prices
and demand, cause turmoil in the global financial
system and negatively impact air travel. Situations
such as these could have a material impact on the
business, financial condition and results of operations.
Following a terrorist attack by Hamas in the Gaza
strip on October 7, 2023, Israel declared war on
Hamas and other terrorist organizations in Gaza.
While a ceasefire has been declared, the situation
remains uncertain and subject to change. The ongoing
military conflict in Israel and the surrounding region,
as well as the stability of any ceasefire and its long-
term outcomes, are highly unpredictable. The Israeli
conflict and any future terrorist attacks or threat
of attacks, whether or not involving commercial
aircraft, any increase in hostilities relating to reprisals
against terrorist organizations or otherwise and any
related economic impact could result in decreased
passenger traffic and materially and negatively
affect the business, financial condition and results
of operations.
Revenues for airlines depend on the number of
passengers carried, the fare paid by each passenger
and service factors, such as the timelines of flight
departures and arrivals. During periods of fog, ice,
low temperatures, storms or other adverse weather
conditions or natural disasters outside of our control,
some or all of our flights may be cancelled or
significantly delayed, affecting and disrupting our
operations and reducing profitability. Increases in the
frequency, severity or duration of thunderstorms,
hurricanes, typhoons, floods or other severe weather
events, including from changes in the global climate
and rising global temperatures, could result in
increases in delays and cancellations, turbulence-
related injuries and fuel consumption to avoid such
weather, any of which could result in loss of revenue
and higher costs. For example, in 2022, a LATAM
aircraft was severely damaged after flying through
stormy weather on approach to Asuncion Airport in
Paraguay, and was required to make an emergency
landing. In October 2023, there were significant
delays and cancellations due to strong weather
conditions in Guarulhos airport, Brazil. Likewise, in
February, 2024, forest fires in Chile affecting the
Valparaiso Region and La Araucanía Region impacted
LATAM’s operations at the Arturo Merino Benitez
International Airport and at La Araucanía International
Airport, respectively, delaying flights and increasing
operational costs derived from certain commercial
flexibility measures granted to passengers affected
by the fires.
Furthermore, in early May 2024, Salgado Filho
International Airport in Porto Alegre, Brazil, experienced
unprecedented flooding due to severe storms in the
region. The airport’s runways and terminals were
submerged, leading to an indefinite suspension of
all operations. To maintain connectivity, commercial
flights were temporarily relocated to Canoas Air
Force Base, approximately 17 kilometers northeast
of Porto Alegre. After extensive recovery efforts, the
airport partially resumed operations on October 21,
2024. LATAM Airlines Brazil began gradually resuming
domestic flights in October 2024, ensuring essential
air connectivity in Brazil. By January 2025, LATAM
group had reintroduced international flights from
Porto Alegre to Lima and Santiago. Notably, LATAM
group did not report any damage to its aircraft as
a result of the flooding. However, it had significant
economic impacts on airlines operating in the region.
For instance, LATAM reported a $25 million reduction
in its operating income in the second quarter of 2024
as a result of the floods. This event underscores the
vulnerability of critical infrastructure to extreme
weather events, highlighting the need for enhanced
resilience measures in the face of climate change.
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In addition, fuel prices and supplies, which constitute
a significant cost for us, may increase as a result of
any future terrorist attacks, a general increase in
hostilities or a reduction in output of fuel, voluntary or
otherwise, by oil-producing countries. Such increases
may result in both higher airline ticket prices and
decreased demand for air travel generally, which
could have an adverse effect on revenues and results
of operations.
The impacts of a pandemic and the efforts to mitigate
the spread of a virus may adversely impact the
group’s business, operations and financial results.
A pandemic, such as COVID-19, and its variants
may negatively affect global economic conditions,
disrupt supply chains and negatively affect aircraft
manufacturing operations and reduce the availability
of aircraft spare parts.
There is a possibility of changes in consumer behavior
in the medium and long term as a result of a pandemic
and its variants that may generate adverse financial
impacts for LATAM. The COVID-19 pandemic and
the accompanying fear of widespread outbreaks
of communicable diseases materially reduced the
demand for and availability of air travel around the
world, materially affecting our business, operations
and financial performance .
By the end of 2023, our operations in domestic
markets were fully recovered, and the international
segment fully recovered during the first quarter
of 2024. While LATAM corporate segment already
achieved pre-pandemic RPK levels, we cannot assure
that a new pandemic or any of its variants will not
affect the business in the future.
Disruptions or security breaches of our information
technology infrastructure or systems could interfere
with the operations, compromise passenger or
employee information, and expose us to liability,
which may adversely affect our business and
reputation.
A serious internal technology error, failure, or
cybersecurity incident impacting systems hosted
internally at our data centers, externally at third-
party locations or cloud providers, or large-scale
interruption in technology infrastructure we depend
on, such as power, telecommunications or the internet,
may disrupt our technology network with potential
impact on our operations. Our technology systems
and related data may also be vulnerable to a variety
of sources of interruption, including natural disasters,
terrorist attacks, telecommunications failures,
computer viruses, cyber-attacks, security breaches
in the supply chain (suppliers) and other security
issues. These systems include our computerized
airline reservation system, flight operations system,
telecommunications systems, website, customer,
self-service applications (“apps”), maintenance
systems, check-in kiosks, in-flight entertainment
systems and data centers.
In July 2024, a major global technology disruption
affecting multiple industries was triggered by
a flaw in a software update to the CrowdStrike
Falcon platform. The disruption triggered outages in
Microsoft’s systems, affecting millions of Windows
operated devices, which resulted in airlines, banks
and media outlets experiencing significant problems
in their operations.
Although the disruption was not a cybersecurity
incident, LATAM group’s technical and business teams
quickly implemented the protocols established to
safeguard the technological environment, successfully
avoiding any operational interruptions in flights
and critical systems. Consequently, no flights were
cancelled during the technological disruption.
Furthermore, in light of the rise of generative Artificial
Intelligence (“AI”) technology, generative AI systems
have the potential to create deceptive or harmful
content, such as deep fakes or fake news, leading
to misinformation and manipulation. The misuse or
malicious intent of generative AI could pose a threat
to our operations and reputation.
In addition, as a part of our ordinary business operations,
we collect and store sensitive data, including personal
information of our customers and employees and
information of our business partners. The secure
operation of the networks and systems on which
this type of information is stored, processed and
maintained is critical to our business operations and
strategy. Unauthorized parties may attempt to gain
access to our systems or information through fraud,
deception, or cybersecurity incidents. Hardware or
software we develop or acquire may contain defects
that could unexpectedly compromise information
security. The compromise of our technology systems
resulting in the loss, disclosure, misappropriation
of, or access to, customers’, employees’ or business
partners’ information could result in legal claims or
proceedings, liability or regulatory penalties under
laws protecting the privacy of personal information,
disruption to our operations and damage to our
reputation, any or all of which could adversely affect
our business.
To date, we have not experienced any major incidents
related to cybersecurity or our information systems.
Any such incident could cause damage to our reputation
and may require us to expend substantial resources
to remedy the situation, and could therefore have a
material adverse effect on our business and results
of operations. In addition, there can be no assurance
that any efforts we make to prevent these incidents
will be successful in avoiding harm to our business.
See “Item 16K. Cybersecurity.”
Risks relating to the airline industry and the countries
in which the group operates
Because our performance is heavily dependent on
economic conditions in the countries in which the
group does business, negative economic conditions
in those countries could adversely impact the group’s
business and results of operations and cause the
market price of our common shares and ADSs to
decrease.
Passenger and cargo demand is heavily cyclical and
highly dependent on global and local economic growth,
economic expectations and foreign exchange rate
variations, among other things. The occurrence of
similar events in the future could adversely affect
our business. The group plans to continue to expand
operations based in Latin America, which means
that performance will continue to depend heavily
on economic conditions in the region.
Latin American countries have historically experienced
economic instability, including uneven periods of
economic growth as well as significant downturns
(e.g., periods of severe economic recession, currency
devaluation, high inflation and political instability).
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Our business has been adversely affected by
these factors and global economic recessionary
conditions, which include weak economic growth in
Chile, recessions in Brazil and Argentina, and poor
economic performance in certain emerging market
countries in which the group operates.
High interest rates, inflation (in some cases substantial
and prolonged), and unemployment rates generally
characterize each economy. Because commodities
such as agricultural products, minerals and metals
represent a significant percentage of exports of many
Latin American countries, the economies of those
countries are particularly sensitive to fluctuations
in commodity prices. Investments in the region may
also be subject to currency risks, such as restrictions
on the flow of money in and out of the country,
extreme volatility relative to the U.S. dollar and
devaluation.
Accordingly, our business, financial condition and
results of operations may be adversely affected
by changes in government policies or regulations in
Latin America, including such factors as exchange
rates and exchange control policies, inflation control
policies, price control policies, consumer protection
policies, import duties and restrictions, liquidity of
domestic capital and lending markets, electricity
rationing, tax policies, including tax increases and
retroactive tax claims, and other political, diplomatic,
social and economic developments in or affecting
the countries where the group operates.
According to S&P, as of December 31, 2024, long term
local currency ratings of the countries where LATAM
group operates in South America are as follows:
Ecuador B- (negative outlook), Peru BBB (stable
outlook), Colombia BBB- (negative outlook), Chile
A+ (stable outlook) and Brazil BB (stable outlook).
Similarly, the long-term foreign currency ratings for
these countries are: Ecuador B- (negative outlook),
Peru BBB- (stable outlook), Colombia BB+ (negative
outlook), Chile A (stable outlook) and Brazil BB
(stable outlook).
LATAM cannot ensure that any country will not
experience similar adverse developments in the future
or that the current or any future administration will
maintain business-friendly and open market economic
policies or policies that stimulate economic growth
and social stability.
Latin American governments have exercised and
continue to exercise significant influence over their
economies.
Governments in Latin America frequently intervene
in the economies of their respective countries and
occasionally make significant changes in policy
and regulations. Governmental actions have often
involved, among other measures, nationalizations and
expropriations, price controls, currency devaluations,
mandatory increases on wages and employee benefits,
capital controls and limits on imports. Our business,
financial condition and results of operations may
be adversely affected by changes in government
policies or regulations, including exchange rates and
exchange control policies, inflation control policies,
price control policies, consumer protection policies,
import duties and restrictions, liquidity of domestic
capital and lending markets, electricity rationing, tax
policies (including tax increases and retroactive tax
oversight). For example, the Brazilian government’s
actions to control inflation and implement other
policies have involved wage and price controls,
depreciation of the real, restrictions on remittance,
and intervention by the Central Bank to affect base
interest rates.
In the future, the level of intervention by Latin
American governments may continue or increase.
We cannot assure that these or other measures will
not have a material adverse effect on the economy
of each respective country and, consequently, will
not adversely affect our business, financial condition
and results of operations.
Political instability and social unrest in Latin America
may adversely affect our business.
LATAM group operates primarily within Latin America
and is thus subject to a full range of risks associated
with our operations in this region. These risks may
include unstable political or social conditions, lack of
well-established or reliable legal systems, exchange
controls and other limits on our ability to repatriate
earnings and changeable legal and regulatory
requirements.
Although political and social conditions in one country
may differ significantly from another country, events
in any of our key markets could adversely affect the
business, financial conditions or results of operations.
For example, in July 2017, Brazilian President Luiz
Inácio Lula da Silva was convicted of corruption and
money laundering by a lower federal court in the
State of Paraná in connection with “Operation Car
Wash”. However, the conviction was overturned and
his political rights restored by the Brazilian Supreme
Court. President Luiz Inácio Lula da Silva ran for
office in the presidential election of October 2022
and narrowly defeated President Bolsonaro. Former
President Bolsonaro questioned the results of the
elections, resulting in protests across the country.
Luiz Inácio Lula da Silva was sworn in as president
in January 2023. We cannot predict which policies
the president Luiz Inácio Lula da Silva may adopt or
change during his term in office, or the effect that
any such policies might have on our business and
on the Brazilian economy.
In Peru, on December 7, 2022, President Pedro
Castillo announced the dissolution of the congress
and called for new elections to be held immediately,
provoking an attempted coup d’état. Subsequently,
he was removed from office and arrested. On the
same day, Vice President Dina Boluarte assumed
the presidency of Peru, to serve the remaining
presidential term until 2026. Dina Boluarte is the
sixth president Peru has had since 2018. None of her
five predecessors in office managed to complete the
five-year term established by the Constitution and
several former presidents are in prison or prosecuted
in judicial proceedings.
In October 2019, Chile saw significant protests
associated with economic conditions which resulted
in the declaration of a state of emergency in several
major cities. The protests in Chile began over criticisms
about social inequality, lack of quality education,
weak pensions, increasing prices and low minimum
wage. If social unrest in Chile were to intensify again,
it could lead to operational delays or adversely
impact our ability to operate in Chile.
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Furthermore, current initiatives to address the
concerns of the protesters are under discussion
in the Chilean Congress. These initiatives include
labor reforms, tax reforms and pension reforms,
among others. On October 25, 2020, Chile widely
approved a referendum to redraft the constitution via
constitutional convention. The election for selecting
the 155-member constitutional convention took
place on May 15 and 16, 2021. On July 4, 2021, the
constitutional convention was convened for a nine-
month period, with the possibility of a one-time,
three-month extension, to present a new constitution.
The proposed constitution was finalized on July 4,
2022. On September 4, 2022, a referendum was
held, in which the proposed constitution was rejected
by a margin of 62% to 38% of voters. On December
12, 2022, Chilean lawmakers announced that they
had agreed to a document entitled “Acuerdo por
Chile” (Agreement for Chile). This document marked
the establishment of a new consensus and served
as foundation for redrafting the new proposed
constitution. The second proposed constitution was
finalized on October 30, 2023. On December 17,
2023, a referendum was held, in which the proposed
constitution was rejected by a margin of 55% to 45%
of voters.
Chile held presidential elections in December 2021,
with left-wing Gabriel Boric winning by a wide margin.
Gabriel Boric was sworn in as president in March 2022.
There can be no assurance that the recent changes
in the Chilean administration, its constitution or
any future civil unrest will not adversely affect our
business, operating results and financial condition
in Chile.
In Ecuador, Guillermo Lasso was elected as President
in 2021, for the 2021-2025 period. On May 16, 2023,
following the media exposure of the “Encuentro
Case”, which revealed the connections between
the Lasso government and certain members of the
Albanian mafia, the National Assembly initiated an
impeachment process against President Lasso, for
embezzlement. However, the next day, Guillermo
Lasso issued an executive decree (Decreto Ejecutivo
741), which ordered the dissolution of the National
Assembly and called for extraordinary presidential
and legislative elections to complete the period.
On October 15, 2023, Daniel Noboa was elected
as an interim president of the Republic of Ecuador
for a period of 18 months. He became the youngest
president elected by popular vote in the history
of the country at thirty-five years of age, and the
second youngest president in the country’s history.
On January 7, 2024, Adolfo Macias, the leader of a
major drug cartel in Ecuador, escaped from prison.
This event revealed strong connections between
the gangs controlling the prisons in the country and
governmental officers, and caused a series of riots
and violent attacks across the country, including
looting, burning vehicles, shootings, explosions and
abductions of police officers and civilians. As a
consequence, on January 8, 2024, President Noboa
declared a 60-day state of emergency in an attempt
to control gang violence, with the support of the
army. As a consequence of the ongoing violence,
President Noboa extended the state of emergency by
30 days. Moreover, on April 21, 2024, a constitutional
referendum was held, in which amendments related
to heightened safety measures were accepted.
On August 7, 2022, Gustavo Petro, candidate for
the left-wing “Pacto Histórico” party, was elected
President of Colombia. Although throughout history
elected governments (and the Colombian Congress)
have pursued free market economic policies, with
almost no economic interventions, we cannot predict
whether the policies that could be adopted by the
administration would have a negative impact on the
Colombian economy or our business operations and
financial performance. Further, regional elections
were held on October 29, 2023, to elect governors for
the 32 departments in Colombia as well as mayors
and members of the local Administrative boards of
the national territory.
On November 19, 2023, Javier Milei was elected
president of the Republic of Argentina for a period
of four years. Javier Milei is a right-wing politician
and economist, who has proposed a comprehensive
overhaul of the country’s fiscal and structural
policies (among others, to dollarize the economy,
privatize state public companies, remove subsidies
on public utilities and close the Argentine Central
Bank of Argentina). The Argentine Executive Branch
has enacted Decree No. 70/2023 contemplating
several measures to reduce the size of the public
administration and public expenses and to de-
regularize the economy. In addition, on June 28,
2024, the Argentine Congress approved Law No.
27,742 (the “Ley de Bases”) which (i) declared a public
emergency for one year in administrative, economic,
financial, and energy matters; (ii) delegated a series
of legislative powers to the Argentine Executive
Branch for the same period; and (iii) provided for a
series of legal, institutional and tax reforms affecting
various sectors of the economy. However, we cannot
predict the social political or economic impact of
the measures announced and implemented by the
government to date, as well as any future measures or
the outcome of the deregulation scheme purported to
be enforced through the above mentioned legislation.
Such measures could affect our financial condition
and the results of operations.
Although conditions throughout Latin America vary
from country to country, our customers’ reactions
to developments in Latin America generally may
result in a reduction in passenger traffic, which
could materially and negatively affect our financial
condition and results of operations.
Because our business relies extensively on third-party
service providers, failure of these parties to perform
as expected, or interruptions in our relationships
with these providers or in their provision of services
to us, could have an adverse effect on our financial
position and results of operations.
We have engaged a significant number of third-
party service providers to perform a large number of
functions that are integral to our business, including
regional operations, operation of customer service
call centers, distribution and sale of airline seat
inventory, provision of technology infrastructure and
services, performance of business processes, including
purchasing and cash management, provision of aircraft
maintenance and repairs, catering, ground services,
and provision of various utilities and performance
of aircraft fueling operations, among other vital
functions and services. We do not directly control
these third-party service providers, although we do
enter into agreements with many of them that define
expected service performance. Any of these third-
party service providers, however, may materially fail
to meet their service performance commitments,
may suffer disruptions to their systems that could
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impact their services, or the agreements with such
providers may be terminated. For example, flight
reservations booked by customers and/or travel
agencies via third-party Global Distribution Systems
(“GDSs”) may be adversely affected by disruptions
in our business relationships with GDS operators or
by issues in the GDS’s operations. Such disruptions,
including a failure to agree upon acceptable contract
terms when contracts expire or otherwise become
subject to renegotiation, may cause the carriers’ flight
information to be limited or unavailable for display,
significantly increase fees for both us and GDS users,
and impair our relationships with customers and
travel agencies.
As of May 1, 2023, LATAM group launched a New
Distribution Capability (“NDC”), which follows the
International Air Transport Association’s (“IATA”)
modernized standard language (XML based) to transmit
data. This distribution channel is an alternative for
travel agencies across all regions where the group
operates, to access our content, and be able to shop,
book, and manage orders. While this distribution
channel mitigates risks of interruption of our services
and lowers our dependency on GDS’s technology, we
cannot assure that the NDC by LATAM will operate
without disruptions that may affect our operations.
The failure of any of our third-party service providers
to adequately perform their service obligations, or
other interruptions of services including those of NDC
by LATAM, may reduce our revenues and increase our
expenses or prevent us from operating our flights and
providing other services to our customers. In addition,
our business, financial performance and reputation
could be materially harmed if our customers believe
that our services are unreliable or unsatisfactory.
Our financial results are exposed to foreign currency
fluctuations.
We prepare and present our consolidated financial
statements in U.S. dollars. LATAM and its affiliates
operate in numerous countries and face the risk of
variation in foreign currency exchange rates against
the U.S. dollar or between the currencies of these
various countries. Changes in the exchange rate
between the U.S. dollar and the currencies in the
countries in which the group operates could adversely
affect the business, financial condition and results
of operations. If the value of the Brazilian real,
Chilean peso or other currencies in which revenues
are denominated declines against the U.S. dollar,
our results of operations and financial condition will
be affected. The exchange rate of the Chilean peso,
Brazilian real and other currencies against the U.S.
dollar may fluctuate significantly in the future.
Changes in Chilean, Brazilian and other governmental
economic policies affecting foreign exchange rates
could also adversely affect the business, financial
condition, results of operations and the return to our
shareholders on their common shares or ADSs. We
actively manage the Brazilian real to U.S. dollar (R$/
US$) exchange rate risk by entering into FX derivative
contracts and carrying out internal operations for
obtaining natural hedging. For further information,
see “Item 11. Quantitative and Qualitative Disclosures
About Market Risk—Risk of Variation in Foreign
Exchange Rates.”
Environmental and regulatory risks
Our operations are subject to local, national and
international environmental regulations; costs
of compliance with applicable regulations, or the
consequences of noncompliance, could adversely
affect our results, our business or our reputation.
LATAM group’s operations are affected by environmental
regulations at local, national and international
levels. These regulations cover, among other things,
emissions to the atmosphere, disposal of solid waste
and aqueous effluents, aircraft noise and other
activities incident to the business. Future operations
and financial results may vary as a result of such
regulations. Compliance with these regulations and
new or existing regulations that may be applicable
to us in the future could increase our cost base and
adversely affect operations and financial results. In
addition, failure to comply with these regulations could
adversely affect us in a variety of ways, including
adverse effects on the group’s reputation.
In 2016, the ICAO adopted a resolution creating
the Carbon Offsetting and Reduction Scheme for
International Aviation (“CORSIA”), providing a framework
for a global market-based measure to stabilize
carbon dioxide (“CO2”) emissions in international civil
aviation (i.e., civil aviation flights that depart in one
country and arrive in a different country). CORSIA
will be implemented in phases, starting with the
participation of ICAO member states on a voluntary
basis during a pilot phase (from 2021 through 2023),
followed by a first phase (from 2024 through 2026)
and a second phase (from 2027). Currently, CORSIA
focuses on defining standards for monitoring, reporting
and verification of emissions from air operators, as
well as on defining steps to offset CO2 emissions
after 2020. In order to comply with this strategy, we
have developed sustainability strategies focused on
climate change and we have taken different measures,
such as the alliance with the Cataruben foundation
in Colombia, with the objectives of offsetting CO2
through reducing deforestation and switching to
sustainable agriculture practices, amongst others,
thus contributing to improve the communities’
life quality and the protection of biodiversity. In
addition, we have other initiatives in place such as
the promotion of SAF (Sustainable Aviation Fuel)
with local governments and the lean fuel program
which seeks to improve fuel efficiency. In addition,
frameworks such as the Emissions Trading System,
both in the EU and UK (“EU-ETS” and “UK-ETS”),
are regulations related to the European market,
where airlines have a pre-established amount of CO2
emissions for each year, which are then reduced over
time, similar to a “cap and trade” system. Airlines
must report and verify emissions related to this
scheme and surrender the allocated allowances in
time in order to comply. Should operations exceed
the maximum allocated emissions, airlines must
either acquire more from the market or pay the
corresponding fee to the authority.
The proliferation of national regulations and taxes
on CO2 emissions in the countries that the group
has domestic operations, including environmental
regulations that the airline industry is facing in
Colombia, where limits on offsetting programs were
included in the new Tax Reform of 2022, may also
affect the cost of operations and the margins.
Our business may be adversely affected by the
consequences of climate change.
There are regulatory risks associated with the
management of climate change in the short and
medium term, due to the fact that, in an effort
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from different countries to contribute to the fight
against climate change, there is a tendency to
impose economic instruments such as carbon taxes
or emissions trading systems that seek to regulate
emissions from different industries, including
the aviation industry. These mechanisms seek to
discourage the consumption of fossil fuels, through
imposing an additional cost. However, in the case of
the airline industry, especially in the South American
region, there is no viable substitute fuel that would
allow the industry to migrate to other types of
fuels. The related risks present an opportunity to
work hand in hand with the relevant governments
to implement public policies allowing for progress in
the production of sustainable aviation fuels in the
region, thus promoting the migration away from fossil
fuels and creating policies and instruments relevant
to industries such as aviation, which currently has
no substitute fuel available in South America. In the
long term, there are physical risks associated with
climate change, including the risk for greater intensity
of meteorological phenomena, such as storms,
tornados, hurricanes, floods and others, which in
turn may pose a risk to infrastructure (destinations,
airports) and communities. As a consequence, it may
be necessary to modify routes and destinations,
which in turn may affect our business and results
of operations.
The business is highly regulated and changes in the
regulatory environment in the different countries
may adversely affect our business and results of
operations.
Our business is highly regulated and depends
substantially upon the regulatory environment in
the countries in which the group operates or intends
to operate. For example, price controls on fares
may limit our ability to effectively apply customer
segmentation profit maximization techniques
(“passenger revenue management”) and adjust prices
to reflect cost pressures. High levels of government
regulation may limit the scope of our operations and
our growth plans. The possible failure of aviation
authorities to maintain the required governmental
authorizations, or our failure to comply with applicable
regulations, may adversely affect our business and
results of operations.
Our business, financial condition and results of
operations may be adversely affected by changes in
policy or regulations at the federal, state or municipal
level in the countries in which the group operates,
involving or affecting factors such as:
⚫ interest rates;
⚫ currency fluctuations;
⚫ monetary policies;
⚫ inflation;
⚫ liquidity of capital and lending markets;
⚫ tax and social security policies;
⚫ labor regulations;
⚫ energy and water shortages and rationing; and
⚫ other political, social and economic developments
in or affecting Brazil, Chile, Peru, and the United
States, among others.
For example, the Brazilian federal government has
frequently intervened in the domestic economy
and made drastic changes in policy and regulations
to control inflation and affect other policies and
regulations. This has required the federal government
to increase interest rates, change taxes and social
security policies, implement price controls, currency
exchange and remittance controls, devaluations,
capital controls and limits on imports.
Uncertainty over whether the Brazilian federal
government will implement changes in policy or
regulation affecting these or other factors may
contribute to economic uncertainty in Brazil and
to heightened volatility in the Brazilian securities
markets and securities issued abroad by Brazilian
companies. These and other developments in the
Brazilian economy and governmental policies may
adversely affect us and our business and results of
operations and may adversely affect the trading
price of our common shares and ADSs.
We are also subject to international bilateral air
transport agreements that provide for the exchange
of air traffic rights between the countries where the
group operates, and we must obtain permission from
the applicable foreign governments to provide service
to foreign destinations. There can be no assurance
that such existing bilateral agreements will continue,
or that we will be able to obtain more route rights
under those agreements to accommodate our future
expansion plans. Certain bilateral agreements also
include provisions that require substantial ownership
or effective control. Any modification, suspension
or revocation of one or more bilateral agreements
could have a material adverse effect on our business,
financial condition and results of operations. The
suspension of our permits to operate to certain airports
or destinations, the inability for us to obtain favorable
take-off and landing authorizations at certain high-
density airports or the imposition of other sanctions
could also have a negative impact on our business.
We cannot be certain that a change in ownership
or effective control or in a foreign government’s
administration of current laws and regulations or the
adoption of new laws and regulations will not have
a material adverse effect on our business, financial
condition and results of operations.
We are subject to anti-corruption, anti-bribery,
anti-money laundering and antitrust laws and
regulations in Chile, Brazil, Peru, the United States
and in the various other countries in which we operate.
Violations of any such laws or regulations could
have a material adverse impact on our reputation,
results of operations and financial condition.
We are subject to anti-corruption, anti-bribery, anti-
money laundering, antitrust and other international
laws and regulations and are required to comply with
the applicable laws and regulations of all jurisdictions
where the group operates. In addition, we are subject
to economic sanctions regulations that restrict dealings
with certain sanctioned countries, individuals and
entities. There can be no assurance that internal
policies and procedures will be sufficient to prevent or
detect all inappropriate practices, fraud or violations
of law by affiliates, employees, directors, officers,
partners, agents and service providers or that any
such persons will not take actions in violation of our
policies and procedures. Any violations by us of laws
or regulations could have a material adverse effect
on the business, reputation, results of operations
and financial condition.
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We are subject to risks relating to litigation and
administrative proceedings that could adversely
affect our business and financial performance in
the event of an unfavorable ruling.
The nature of the business exposes us to litigation
relating to labor, insurance and safety matters,
regulatory, tax and administrative proceedings,
governmental investigations, tort claims and contract
disputes. Litigation is inherently costly and unpredictable,
making it difficult to accurately estimate the outcome
among other matters. Currently, as in the past,
we are subject to proceedings or investigations of
actual or potential litigation. Although we establish
accounting provisions as we deem necessary, the
amounts that we reserve could vary significantly
from any amounts we actually have to pay due to
the inherent uncertainties in the estimation process.
We cannot assure you that these or other legal
proceedings will not materially affect the business.
For further information, see “Item 8. Financial
Information—Legal and Arbitration Proceedings”
and Note 30 to our audited consolidated financial
statements included in this report.
Rapid technological advancements and digitalization
could generate risks in implementation and regulatory
control.
Globally, there have been large advances in processes
of digitization and technological innovation. These
new technologies could generate new risks in their
implementation that could impact us directly or
indirectly. As an example, at the beginning of 2022,
the implementation of 5G in the United States had a
temporary impact on operations at certain airports
and generated a review by the Federal Aviation
Administration (“FAA”) on the specific requirements
for its implementation. Additionally, during the
course of 2023, while the widespread adoption
and growth of Generative Artificial Intelligence
systems demonstrated significant innovation and
advancement in our operations, they could present
certain risks that would likely require a regulatory
framework to effectively address them. While LATAM
is working on internal policies to regulate the use
of these technologies, all processes of digitization
and technological innovation may be exposed to
risks, or may need to adjust to comply with future
regulatory frameworks.
Similarly, the rapidly increasing technological
transformation may advance faster than the
review and control capacity of the authorities and
the knowledge about the effects of their possible
impacts, which could affect us directly or indirectly
in ways we cannot foresee.
Our reputation and brand could be adversely impacted
if we fail to make progress towards achieving our
environmental sustainability goals.
Our reputation and brand could also be adversely
impacted by, among other things, failure to make
progress toward and achieve our environmental
sustainability goals, as well as public pressure from
investors or policy groups to change our policies or
negative public perception of the environmental
impact of air travel. For example, we are committed
to significantly reducing our carbon emissions, with
the long-term ambition of achieving carbon neutrality
by 2050. Achieving this will require significant capital
investment from manufacturers and other stakeholders,
as we are unable to achieve these long-term goals
using our existing fleet, current technologies and
available fuel sources. We are continuing to develop
our climate strategy and transition plan; however,
our ability to execute on such a plan is subject to
substantial risks and uncertainties, as it is dependent
on the actions of governments and third parties and
will require, among other things, significant capital
investment, including from third parties, research
and development from manufacturers and other
stakeholders, along with government policies and
incentives to reduce the cost, and incent production
of technologies that are not available at scale.
Significant damage to our reputation and brand could
have a material adverse effect on our business and
financial results, including as a result of litigation
related to any of these matters.
Risks related to our indebtedness
We have substantial liquidity needs and continue to
pursue various financing options. Our business may
be adversely affected if we are unable to service
our debt or meet our future financing requirements.
We have a high degree of debt and payment
obligations under our aircraft leases and financial
debt arrangements. We require significant amounts
of financing to meet our aircraft capital requirements
and may require additional financing to fund our other
business needs. We cannot guarantee that we will
have access to or be able to arrange for financing in
the future on favorable terms. Higher financing costs
could affect our ability to expand or renew our fleet,
which in turn could adversely affect our business.
In addition, a substantial portion of our property and
equipment is subject to liens securing our indebtedness,
including our secured bonds and loans. In the event
that we fail to make payments on our bonds and
loans, creditors’ enforcement of liens could limit
or end our ability to use the affected property and
equipment to fulfill our operational needs and thus
generate revenue. For further information, related to
current contractual obligations, see “Item 5. Operating
and Financial Review and Prospects—Contractual
Obligations—Long Term Indebtedness.”
Moreover, external conditions in the financial and
credit markets may limit the availability of funding
or increase its costs, which could adversely affect
our profitability, our competitive position and result
in lower net interest margins, earnings and cash
flows, as well as lower returns on shareholders’
equity and invested capital. Factors that may affect
the availability of funding or cause an increase in
our funding costs include global macro-economic
crises, reductions in our credit rating or in that of our
issuances, and other potential market disruptions.
We have significant exposure to SOFR and other
floating interest rates; increases in interest rates will
increase our financing cost and may have adverse
effects on our financial condition and results of
operations.
Because the publication of LIBOR was discontinued
on June 30, 2023, we have amended our derivative
and debt contracts to replace the LIBOR rate for
the Secured Overnight Financing Rate (“SOFR”) as
an alternative rate as convened by the Alternative
Reference Rates Committee (“ARRC”). SOFR will
fluctuate with changing market conditions and, as
SOFR increases, our interest expense will mechanically
increase, which could have an adverse effect on our
total financing costs. As of December 31, 2024, our
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variable interest rate debt amounted to US$928
million.
We may be unable to adequately adjust our prices
to offset any increased financing costs, which would
have an adverse effect on our results of operations.
If we are unable to adequately adjust our prices,
our revenue might not be sufficient to offset the
increased payments due under our loans and this
would adversely affect our financial condition and
results of operations. In addition, there is no guarantee
that SOFR or other replacement rates for LIBOR will
maintain market acceptance. See also the discussion
of interest rate risk in “Item 11. Quantitative and
Qualitative Disclosures About Market Risks—Risk
of Fluctuations in Interest Rates.”
Our debt agreements contain various affirmative,
negative and financial covenants, which could limit
our ability to conduct our business. A breach of certain
negative covenants could also trigger an event of
default and acceleration of our indebtedness.
Certain of our debt instruments, including our (i)
13.375% Senior Secured Notes due 2029 (the “2029
Notes”) and (ii) 7.875% Senior Secured Notes due
2030 (the “2030 Notes”), contain an asset coverage
ratio and certain limitations to the incurrence of
additional indebtedness by us and our subsidiaries.
A decline in this coverage ratio, including due to
factors that are beyond our control, could require
us to post additional collateral, trigger an increase
in the annual interest rates stipulated under our
various debt instruments, or an event of default.
Complying with certain of the covenants in our debt
agreements and other restrictive covenants that
may be contained in any future debt agreements
could limit our ability to operate our business and to
take advantage of business opportunities that are in
our long-term interest. See Note 31 of our audited
consolidated financial statements.
While the covenants in our debt agreements are
subject to important exceptions and qualifications, if
we fail to comply with them and are unable to obtain
a waiver or amendment, refinance the indebtedness
subject to these covenants or take other mitigating
actions, an event of default would result. These
arrangements also contain other events of default
customary for such financings. If an event of default
were to occur, the lenders or noteholders could, among
other things, declare outstanding amounts due and
payable and where applicable and subject to the
terms of relevant collateral agreements, repossess
collateral, including aircraft or other valuable assets.
In addition, an event of default or acceleration of
indebtedness under one agreement could result in an
event of default under other of our debt instruments.
The acceleration of significant indebtedness could
require us to seek to renegotiate, repay or refinance
the obligations under our debt arrangements, and
there is no assurance that such renegotiation or
refinancing efforts would be successful.
Risks relating to our common shares and adrs
Our major shareholders may have interests that
differ from those of ADSs holders.
As of December 31, 2024, our major shareholders
beneficially owned, in the aggregate, 63% of our
common shares. Each of these shareholders could
have interests that may differ from those of other
shareholders, including our ADSs holders. While
their interests are not necessarily aligned, these
major shareholders hold shares, and will continue to
hold shares after this offering, with sufficient voting
power under Chilean law to approve substantially all
of the forms of corporate action subject to decision
by shareholders’ meetings, including the distribution
of dividends above the minimum dividend required
by law, to elect a majority of the members of our
board of directors, direct our management and control
substantially all matters that are to be decided
by a vote of shareholders, including fundamental
corporate transactions.
The market perception of a secondary offering could
create downward pressure on the market price of
our common shares and ADRs.
Approximately 53% of our common shares are held by
the shareholders disclosed in Item 6 and approximately
25% of our common shares are held by shareholders
who have agreed amongst themselves or as part of
the subscription of the Company’s convertible notes
Series H and the conversion thereof into common
shares of the Company not to sell such shares until
November 2026 (the “Long-Term Sale Limitations”).
However, the Long-Term Sale Limitations could be
amended, waived or otherwise modified in most
cases without the consent or knowledge of the
investors. Accordingly, while any share can be sold
at any time, the market perception of a potential
large-scale sale of our common shares could create
downward pressure on the market price of our ADSs.
In the future, we may also issue additional common
shares if we need to raise capital, which could
constitute a material portion of our then-issued
and outstanding common stock. Any such issuances
may dilute your ownership interest in the Company
if preemptive rights are not exercised in a timely
manner and have an adverse impact on the price
of the ADSs or the common shares underlying the
ADSs.
Holders of ADSs may be adversely affected by their
limited voting rights.
Holders of ADSs may exercise voting rights with
respect to common shares represented by ADSs
only in accordance with the deposit agreement
governing the ADSs. Holders of ADSs will face practical
limitations in exercising their voting rights because of
the additional steps involved in our communications
with ADS holders. To exercise their voting rights,
holders of ADSs must instruct the ADS depositary
on a timely basis on how they wish to vote. Under
the terms of the deposit agreement, if holders of
ADSs do not provide JP Morgan Chase Bank, N.A., in
its capacity as depositary for the ADSs, with timely
instructions on the voting of the common shares
underlying their ADSs, the depositary will be deemed
to have been instructed to give a person designated
by the board of directors the discretionary right to
vote those common shares. The person designated by
the board of directors to exercise this discretionary
voting right may have interests that are aligned with
certain of our major shareholders, which may differ
from those of our other shareholders. Historically,
our board of directors has designated its chairman
to exercise this right, but there is no guarantee
that it will do so in the future. The members of the
board of directors elected by the shareholders in
2024 designated Ignacio Cueto, to serve in this role.
Ignacio Cueto is a member of the Cueto Group, one
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12 / ANNEXES
of our major shareholders.
Holders of ADSs may be adversely affected by currency
devaluations and foreign exchange fluctuations.
If the Chilean peso exchange rate falls relative
to the U.S. dollar, the value of the ADSs and any
distributions made thereon from the depositary
could be adversely affected. Cash distributions
made in respect of the ADSs are received by the
depositary (represented by the custodian bank in
Chile) in pesos, converted by the custodian bank
into U.S. dollars at the then-prevailing exchange rate
and distributed by the depositary to the holders of
the ADRs evidencing those ADSs. In addition, the
depositary will incur foreign currency conversion
costs (to be borne by the holders of the ADRs) in
connection with the foreign currency conversion
and subsequent distribution of dividends or other
payments with respect to the ADSs.
Future changes in Chilean foreign investment controls
and withholding taxes could negatively affect non-
Chilean residents that invest in our shares.
Equity investments in Chile by non-Chilean residents
have been subject in the past to various exchange
control regulations that govern investment repatriation
and earnings thereon. Although not currently in
effect, regulations of the Central Bank of Chile
have in the past imposed such exchange controls.
Nevertheless, foreign investors or custodians (as
applicable, whether investments are made directly
or through such custodian) still have to provide the
Central Bank of Chile with information related to
equity investments in accordance with the provisions
set forth in the compendium of Foreign Exchange
Regulations (Compendio de Normas de Cambios
Internacionales) of the Central Bank of Chile. Although
the custodian for the ADS depositary is currently
responsible for providing such information with
respect to the ADS program to the Central Bank of
Chile, we cannot predict what information Chilean
regulators may require from holders of ADSs in the
future. Furthermore, any changes in withholding
taxes could negatively affect non-Chilean residents
that invest in our shares.
We cannot assure you that additional Chilean
restrictions applicable to the holders of ADSs,
the disposition of the common shares underlying
ADSs or the repatriation of the proceeds from an
acquisition, a disposition or a dividend payment,
will not be imposed or required in the future, nor
could we make an assessment as to the duration or
impact, were any such restrictions to be imposed
or required. For further information, see “Item 10.
Additional Information—Exchange Controls — Foreign
Investment and Exchange Controls in Chile.”
Our ADS holders may not be able to exercise
preemptive rights in certain circumstances.
Chilean Corporate Law requires Chilean corporations
to offer existing shareholders the right to subscribe a
sufficient number of shares to maintain their existing
percentage of ownership in a company whenever
that corporation issues new shares for cash, subject
to certain exceptions. Under this requirement,
any preemptive rights will be offered by us to the
depositary as the registered owner of the common
shares underlying the ADSs, but holders of ADSs
and shareholders located in the United States will
not be allowed to exercise preemptive rights with
respect to new issuances of shares by us unless a
registration statement under the Securities Market
Act is effective with respect to those common shares
or an exemption from the registration requirements
thereunder is available.
To the extent that a holder of our ADSs is unable to
exercise its preemptive rights because a registration
statement has not been filed, the depositary may
attempt to sell the holder’s preemptive rights in Chile
and distribute the net proceeds of the sale, net of
the depositary’s fees and expenses, to the holder,
provided that a secondary market for those rights
exists and a premium can be recognized over the
cost of the sale. A secondary market for the sale of
preemptive rights can be expected to develop if the
subscription price of the shares of our common stock
upon exercise of the rights is below the prevailing
market price of the shares of our common stock.
However, we cannot assure you that a secondary
market in preemptive rights will develop in connection
with any future issuance of shares of our common
stock or that, if a market develops, a premium can
be recognized on their sale. Amounts received in
exchange for the sale or assignment of preemptive
rights relating to shares of our common stock will
be taxable in Chile and in the United States. The
inability of holders of ADSs to exercise preemptive
rights in respect of common shares underlying their
ADSs could result in a change in their percentage
ownership of common shares following a preemptive
rights offering. If a secondary market for the sale of
preemptive rights does not develop and such rights
cannot be sold, they will expire, and a holder of
our ADSs will not realize any value from the grant
of the preemptive rights. In either case, the equity
interest of a holder of our ADSs in us will be diluted
proportionately.
We are not required to disclose as much information
to investors as a U.S. issuer is required to disclose
and, as a result, you may receive less information
about us than you would receive from a comparable
U.S. company.
The corporate disclosure requirements that apply to us
may not be equivalent to the disclosure requirements
that apply to a U.S. company and, as a result, you
may receive less information about us than you would
receive from a comparable U.S. company. We are
subject to the reporting requirements of the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”). The disclosure requirements applicable to
foreign issuers under the Exchange Act are more
limited than the disclosure requirements applicable
to U.S. issuers. Publicly available information about
issuers of securities listed on Chilean stock exchanges
also provides less detail in certain respects than the
information regularly published by listed companies
in the United States or in certain other countries.
Furthermore, there is a lower level of regulation of
the Chilean securities market and of the activities
of investors in such markets as compared with
the level of regulation of the securities markets in
the United States and in certain other developed
countries. For further information, see “Item 16G.
Corporate Governance.”
12 / ANNEXES
PROCUREMENT
SUSTAINABLE PROCUREMENT INDICATORS
Criterion
2024
Percentage of specific suppliers that have signed the supplier code of conduct
100%
Percentage of specific suppliers with contracts that include clauses on environmental, labor
practices and human rights requirements
100%
Number of specific suppliers covered by a Corporate Social Responsibility (CSR) assessment
95
Percentage of all buyers who received training on sustainable procurement
100%
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12 / ANNEXES
ENVIRONMENTAL
MANAGEMENT
Scope of the information
UNIT
2021
2022
2023
2024
JET FUEL— AIR OPERATION
%
100
100
100
100
Fuel— stationary sources
Diesel
%
96
100
96
100
Natural gas
%
100
100
N/A
N/A
Gasoline
%
100
100
100
100
LPG
%
100
100
100
100
Fuel— mobile sources
Diesel
%
96
96
98
96
Gasoline
%
96
96
100
96
LPG
%
100
100
N/A
96
Refrigerating gases (various)
%
100
100
100
100
Electricity
%
100
100
100
100
Transportation using other airlines (jet fuel)
%
100
100
100
100
Assurance and certification of latam group's environmental
management system (ems) in 2024
COVERAGE (%)1
DESCRIPTION
International standards (e.g., ISO 14001,
JIS Q 14001 and EMAS certification,
etc.).
98.8%
LATAM group implements a certified, transparent and
auditable Environmental Management System (EMS) in its
operations in Brazil, Chile, Colombia, Ecuador, the United
States and Peru, following IEnvA and ISO 14001 standards.
Third parties by specialized companies
1.2%
LATAM group works with the International Air Transport
Association (IATA) IEnvA certification program, which
independently evaluates the environmental commitment of
various aviation players, such as airlines, airports and related
service providers. Based on international standards and
best practices, such as ISO 14001 and the IATA Operational
Safety Audit (IOSA), IEnvA offers a comprehensive and
voluntary solution for environmental management and
sustainability in the airline industry.
LATAM group specialists from
headquarters
-
LATAM group conducts annual inspections of its facilities
in each country, along with drills on how to manage the
established protocols
Profitability of environmental investments
UNIT
2024
Capital investments
US$
200,057
Operating expenses
US$
2,211,532
Total expenses
US$
2,411,588
Savings, cost reduction, revenue generation and tax incentives,
among others.
US$
0
COMMITMENT TO
SUSTAINABILITY
1 The total coverage of the three categories must not exceed 100%. To avoid double counting, in operations with multiple certifications or types of assu-
rance, the following order of priority is applied: first, international standards coverage; then, third-party assurance; and finally, internal assurance.
LATAM
GROUP
2024
› 258
12 / ANNEXES
CLIMATE CHANGE
MANAGEMENT
NCG 519: 3.1.II GOVERNANCE FRAMEWORK AND 3.6.II AND
3.6.IV RISK MANAGEMENT
SASB TR-AL-110A.2
TCFD
⚫ Governance
LATAM group manages the governance of climate-
related risks and opportunities through a clear
structure and a strategic approach involving various
areas of the organization. In this context, the
Board of Directors has appointed a Sustainability
and Strategy Subcommittee, which is the highest
authority on climate issues, to oversee these risks
and opportunities.
This Committee is responsible for advancing
sustainability objectives and commitments into
the future, as well as developing, implementing
and reporting on the Sustainability Strategy,
which includes specific objectives, along with key
performance indicators (KPIs) and budgets for the
main business units and functional areas, as well as
high-level strategy reviews. In addition, it provides
annual reports to the Board of Directors on the
progress and results of the sustainability and climate
strategies, together with the executives in charge
of the strategic pillars of sustainability.
On the other hand, the definition of objectives related
to climate risks and opportunities, as well as the
monitoring of their progress through a set of KPIs,
is overseen by the Sustainability, Safety and Fuel
Management areas to ensure effective monitoring
of the progress towards the established objectives.
At the operational level, the Corporate Affairs and
Sustainability Team is responsible for identifying
environmental and social risks, which are consolidated
and reported to LATAM group’s Executive Committee
and Risk Management Unit. These are then integrated
into the organization's risk management matrix. In this
regard, Management plays a key role in monitoring,
managing and overseeing these risks, ensuring that
decisions are informed and effective controls are
implemented.
Through this governance structure, LATAM group
ensures that climate risks and opportunities are
effectively managed, aligning with its sustainability
objectives and strengthening its resilience to the
challenges of climate change management.
⚫ Strategy
Considering that sustainability and financial
transparency are increasingly valued and essential,
and in response to the growing interest in climate
risk management, since 2023, LATAM group has been
conducting a scenario analysis to identify and assess
climate-related risks and opportunities. This process
resulted in the identification and prioritization of
12 key risks and opportunities, based on an initial
analysis that included over 50 factors. With these
findings, LATAM group seeks to align its climate risk
disclosure with TCFD recommendations.
This alignment not only strengthens transparency in
risk management, but also allows LATAM group to
integrate these climate elements into its business
management, thus consolidating its leadership in
sustainability.
Defining time horizons
TIME HORIZON
YEAR
Short term
2025
Medium term
2030
Long term
2050
LATAM group incorporates climate factors into
its strategic plans, addressing both physical risks
and extreme weather events, as well as transition
opportunities towards a low-carbon economy arising
from regulatory changes. To this end, it implements
mitigation and adaptation strategies that include
sustainable technologies, operational optimization
and collaboration with stakeholders.
In addition, LATAM group conducts climate scenario
analyses to assess its resilience and anticipate
impacts on its operations and finances. This approach
enables it to develop contingency plans and take
advantage of emerging opportunities, consolidating
its adaptation and strengthening its commitment
to sustainability.
LATAM
GROUP
2024
› 259
12 / ANNEXES
Summary of the assessment of climate scenarios for the main physical and transitional risks and opportunities identified.
RISK
TYPE OF
RISK
RISK DESCRIPTION
TIME HORIZON
IMPACT FOR THE COMPANY
Extreme temperatures
Physical
Due to global warming, extreme temperatures are becoming more
frequent and severe, due to the increase of greenhouse gases (GHG),
which trap heat in the atmosphere, affecting aircraft performance and
infrastructure integrity.
Corto: Bajo
Medio: Medio
Largo: Alto
In the operational sphere, rising temperatures could make it impossible for aircraft to take off on runways
that are not long enough, while accelerating pavement deterioration. This phenomenon, combined with the
decrease in air density, affects aircraft cargo capacity, which could translate into an economic impact for
LATAM group. Likewise, in offices, an increase in temperatures implies higher energy consumption due to
the intensive use of air conditioning systems.
Coastal flooding
Physical
Coastal flooding occurs mainly due to a rise in sea levels. This is a direct
effect of climate change, caused by the melting of glaciers and ice caps,
as well as the thermal expansion of water as the oceans warm.
Corto: Muy bajo
Medio: Muy bajo
Largo: Muy bajo
One of the main challenges is service disruptions and restricted access to airports, which affects both
passengers and workers. In addition, potential damage to airport infrastructure, including aircraft and
facilities, can result in significant communication disruptions and high repair costs.
Climate projections indicate that the Santos Dumont (Brazil) and José Joaquín de Olmedo (Ecuador)
airports face an increasing risk of flooding, with estimated levels of between 5 and 10 cm.
River flooding
Physical
Increased precipitation and heavy rainfall events. Changes in rainfall
patterns due to climate change, affecting drainage and increasing the
risk of flooding.
Corto: Bajo
Medio: Bajo
Largo: Bajo
Same impacts as indicated for coastal flooding. With regard to projections, 40 airports are expected to
experience some flooding within a 5 km radius, with 11 of them expected to experience more than 10 cm
of flooding.
Torrential rains
Physical
Alterations in the hydrological cycle, due to global warming, which
modifies pressure and wind systems, affecting rainfall.
Corto: Alto
Medio: Bajo
Largo: Moderado
Torrential rains pose a challenge for LATAM group’s operations due to their ability to cause localized
surface water flooding. These events can cause significant problems and delays in operations, in addition to
complicating access to airports for both workers and passengers. Projections indicate that the number of
airports exposed to moderate and high flood risks will grow between 2030 and 2050, increasing the need
for adequate preparedness.
Thunderstorm
Physical
Changes in global weather patterns may increase storm frequency and
intensity. This is due to the warming of oceans and the atmosphere,
which generates more energy for this purpose.
Corto: Alto
Medio: Moderado
Largo: Moderado
Thunderstorms can pose a risk to the health and safety of LATAM group’s airborne and ground personnel,
as well as to the continuity of operations. According to the recommendations of the International Civil
Aviation Organization (ICAO), operations must be suspended when lightning is detected within a 5 km
radius of the airport, which can disrupt operations.
By 2050, airports in the Galapagos Islands (Ecuador) and Junin (Peru) are expected to face a high risk
of thunderstorms, with significant increases also projected for other airports in the region, such as in
Colombia and mainland Ecuador.
Short: Low
Short: Very low
Medium: Moderate
Medium: Very low
Long: High
Long: Very low
Short: Low
Short: High
Medium: Low
Medium: Low
Long: Low
Long: Moderate
Medium: Moderate
Long: Moderate
Short: High
LATAM
GROUP
2024
› 260
12 / ANNEXES
High winds
Physical
High winds can result from severe storms, cold fronts, or tropical
cyclones, which intensify with global warming as it affects atmospheric
circulation patterns, and can intensify low pressure systems and
increase wind speeds.
Corto: Muy bajo
Medio: Bajo
Largo: Bajo
High winds can pose a challenge to LATAM Group's hubs, potentially causing damage to airport
infrastructure and, in some cases, leading to the temporary interruption of ground handling. These events
not only increase the costs of repairs and new infrastructure, but also affect flights’ on-time performance
(OTP) and safety, with direct impacts on aircraft take-off, as well as delays and cancellations. The number
of airports exposed to this risk is expected to remain stable from 2030 to 2050.
Storm (tropical cyclones)
Physical
Low pressure systems that need a set of specific atmospheric
conditions, such as high humidity, light winds in the upper levels of the
atmosphere and warm sea temperatures, to develop and strengthen.
Corto: Moderado
Medio: Muy bajo
Largo: Muy bajo
Tropical cyclones pose a challenge for LATAM group, with the potential to cause extensive damage to office
and airport infrastructure. These extreme events can result in a considerable increase in costs due to
necessary repairs or the construction of new infrastructure. In addition, they can affect the performance
of aircraft engines, which increases maintenance requirements and, consequently, operating costs.
Fuel supply disruptions are another associated critical risk, which can increase operating and supply costs
within the fuel value chain.
Clear-air turbulence
Physical
A phenomenon that occurs in clear skies, far from any cloud formations
or thunderstorms. This occurs when there are sudden variations in wind
speed at different altitudes, which generates unstable and turbulent air
currents.
Indeed, in the North Atlantic, models conclude that for every 1°C
increase in global temperature, moderate turbulence is expected to
increase by 14% in autumn and summer, and by 9% in winter and
spring.
Corto: Incierto
Medio: Incierto
Largo: Alto
Clear-air turbulence poses a challenge for LATAM group, especially in terms of aircraft damage, which
could result in detours and rerouting. These operational adjustments not only increase interruptions, but
also raise operating and insurance costs. In addition, there is a significant risk to passenger and crew
health and safety, which could negatively impact LATAM group’s reputation.
With the projected increase in annual maximum temperature in New York (USA) by almost 2.5°C by 2050,
flights to and from New York are expected to face more challenging conditions. In South America, the
March to August period is expected to experience an increase in moderate turbulence, which could affect
flight experience and operational planning.
Fires
Physical
The main increase in wildfires is expected to be due to a decrease in
total rainfall along with rising temperatures in the region, especially in
the Amazon, where the region's optimal conditions for wildfires may
increase from 42% to 63% by 2050 in a 4°C increase scenario.
In South America, the area burned annually (in a 4°C scenario in 2050)
is expected to increase from 0.7K km2 to 2.5K km2, mainly in the
Amazon and the Cerrado region of Brazil.
Corto: Bajo
Medio: Bajo
Largo: Moderado
Wildfires pose a risk to LATAM group’s operations, with the potential to cause significant disruptions and
damage to airport infrastructure. These events can affect air quality, limiting the visibility and safety of air
operations, resulting in flight diversions, cancellations and delays, thereby increasing operating costs.
Short: Very low
Medium: Low
Long: Low
Short: Moderate
Medium: Very low
Long: Very low
Short: Uncertain
Medium: Uncertain
Long: High
Short: Low
Medium: Low
Long: Moderate
RISK
TYPE OF
RISK
RISK DESCRIPTION
TIME HORIZON
IMPACT FOR THE COMPANY
LATAM
GROUP
2024
› 261
12 / ANNEXES
OPPORTUNITY
TYPE OF
OPPORTUNITY
DESCRIPTION OF OPPORTUNITY
TIME HORIZON
IMPACT FOR THE COMPANY
Capacity for technological
transition to a low-carbon
economy
Transition
LATAM group is committed to transitioning to a low-carbon
economy, integrating various technologies and strategies that
foster sustainability. This technological transition focuses on several
key aspects: use of SAF, technological and operational efficiency,
collaboration with key stakeholders such as governments, and its
commitment to sustainability based on its strategy.
Corto: Bajo
Medio: Alto
Largo: Alto
LATAM group faces an opportunity to increase profits by reducing operating costs related to fossil fuel
consumption and carbon emissions.
Implementing sustainable practices not only improves operational efficiency, but also enhances
reputation, attracting consumers with an increasing awareness of the environment and securing
sustainable revenues in the long term. This strategic approach could increase LATAM group’s valuation
and attract sustainable financial capital. As aviation is highly dependent on fossil fuels, it is necessary
to invest in innovation and implement low-carbon technologies.
In the medium term, the use of SAF appears to be the most viable alternative, as long as the enabling
conditions are created in the region.
While there are emerging technologies for short or regional flights, these are still under development
and depend on corporate initiatives such as aircraft refurbishment and regulations that enable the
creation of a robust supply chain, especially in regions such as Latin America.
Carbon price exposure that
includes the aviation sector
Transition
Although it may initially appear to be a risk due to the additional
costs, exposure to carbon prices also represents a significant
opportunity for LATAM group. By anticipating and adapting to
carbon pricing regulations, LATAM group can position itself as a
leader in sustainability and energy efficiency. This not only helps to
mitigate long-term operating costs, but also enhances LATAM group's
reputation as an airline committed to reducing its emissions.
Corto: Bajo
Medio: Alto
Largo: Muy alto
The levying of carbon taxes on Scope 1 emissions and fuel costs resulting from the implementation of
a carbon price along the value chain may increase operating costs. These increases could translate into
higher ticket prices, potentially reducing consumer demand and affecting LATAM group's market share,
especially if other airlines proactively reduce their energy and carbon footprint.
In Latin America, although there are currently no mechanisms that apply direct costs to the aviation
sector, carbon taxes do have an impact on fuels (such as jet fuel). Carbon costs are expected to increase
in countries with commitments of net-zero emissions by 2050, such as Brazil and Chile, which could
increase airfares and reduce demand for regional flights. However, the adoption of SAF and other low-
carbon fuels offers an opportunity to reduce exposure to these costs in the medium and long term.
Changes in passenger/consumer
behavior and preferences
Transition
Changes in consumer behavior and preferences towards more
sustainable and environmentally aware options provide LATAM group
with the opportunity to secure a growing market of passengers who
value responsible practices.
By aligning its services with these expectations, LATAM group can
increase customer loyalty and stand out in a competitive market.
Corto: Bajo
Medio: Bajo
Largo: Moderado
One of the main challenges is the potential decline in demand for aviation services, as increasingly
environmentally aware customers may opt for other modes of transportation, which could impact
revenues. This shift in consumer preferences underscores the importance of LATAM group continuing to
innovate in sustainability and operational efficiency.
Short: Low
Short: Low
Short: Low
Medium: High
Medium: High
Medium: Low
Long: High
Long: Very high
Long: Moderate
LATAM
GROUP
2024
› 262
12 / ANNEXES
⚫ Risk management
LATAM group addresses climate risk management
through a comprehensive approach that combines
processes, policies and tools to identify, assess
and prioritize these factors. In this context, the
Sustainability and Strategy Subcommittee, together
with the Board of Directors, oversees the integration
of climate considerations in decision-making, aligning
actions with sustainability objectives.
In this way, LATAM group assesses its exposure to
climate risks considering physical risks—both acute
and chronic—as well as transition risks, which include
current and emerging regulation, technological
advances, legal aspects, market and reputation risks,
through an analysis of historical data and forecasts,
monitoring the vulnerability of its operations and
key indicators, such as operating efficiency and
emissions. In addition, it performs simulations of
future scenarios, such as a temperature increase of
+4°C and a rapid transition scenario with a warming
of +1.5°C, to design robust mitigation and adaptation
strategies.
In turn, using a multidimensional
approach, LATAM group identifies
critical risk levels and assesses
the susceptibility of its operations
to extreme weather events, using
scientific data and climate models
This approach strengthens operational and financial
resilience, aligning with its long-term sustainability
objectives.
On the other hand, LATAM group monitors international
and local climate regulations, such as the EU Emissions
Trading System, the Refuel EU mandate and draft
legislation in Brazil and Colombia, among others.
These regulations affect its operations, so LATAM
group ensures that it complies with emission reduction
obligations in all countries where it operates.
Finally, it should be noted that these risks are managed
by the Risk Unit, which works collaboratively with all
key stakeholders, including governments, to promote
informed public policies.
⚫ Metrics and Objectives
LATAM group uses a series of metrics to assess the
risks and opportunities related to climate change
management, aligning its strategies with short-,
medium- and long-term objectives. These are essential
to integrate sustainability into their operations and
to respond to challenges and opportunities.
Metrics Used
⚫ CO2 emissions and Carbon Footprint: LATAM group measures its carbon
emissions in its 3 Scopes, including fossil fuel use and consumption, which
represent most of its carbon footprint.
⚫ Operational Efficiency Indicators: Fuel consumption per revenue passenger-
kilometer (RPK) is monitored to assess the efficiency of passenger operations
and carbon emissions over revenue ton-kilometers (RTK) to measure their
cargo and consolidated operations (cargo and passengers together).
⚫ Physical Risks and Transition Opportunities: LATAM group assesses
exposure to physical risks (such as extreme temperatures, floods and storms)
and transition opportunities (such as regulatory and market changes) using
climate model data and scenario analysis.
1
2
3
12 / ANNEXES
⚫ Short Term (until 2025):
Improve fuel efficiency by implementing new
technologies and optimized operating practices.
Based on availability and through collaboration with
partners, use SAF to reduce direct emissions. For this
purpose, it is necessary to work collaboratively with
all the players in the chain, such as governments,
potential producers, distributors, and allies, among
others, to generate the enabling conditions for the
development of these fuels in the region.
⚫ Medium Term (until 2030)
Based on availability and through collaboration with
partners, use SAF to reduce direct emissions. For this
purpose, it is necessary to work collaboratively with
all the players in the chain, such as governments,
potential producers, distributors, and allies, among
others, to generate the enabling conditions for the
development of these fuels in the region.
Anticipate transition risks to comply with new
regulations associated with the reduction and/or
offsetting of greenhouse gas emissions in Latin
America and the world, competitively.
Continue to prioritize emission reduction measures
in Scope 1, with the purpose of reducing emissions
intensity; i.e., reducing the amount of CO2 emitted
per passenger and/or ton transported.
As a complementary measure, offset emissions,
prioritizing projects that generate co-benefits
and contribute to the conservation of the region's
ecosystems and biodiversity.
⚫ Long Term (until 2050)
Achieve net-zero emissions through a combination
of operational efficiencies, new technologies, use
of SAF and emissions offsets as a complementary
measure.
Collaborate with key stakeholders in the value chain
to develop airport and operational infrastructure that
is resilient to the impacts of climate change, such as
extreme temperatures and severe weather events.
2025 2030 2050
Specific Objectives
› 263
LATAM
GROUP
2024
12 / ANNEXES
Greenhouse gases
GRI 305-1, 305-2, 305-3 AND 305-4 | TR-AL-110A.1.
UNITS
2021
2022
2023
2024
VARIATION
2024/2023
Direct emissions (Scope 1)
tCO2e
6,497,576
9,780,288
11,524,420
13,118,183
13.83
Indirect emissions (Scope 2)
tCO2e
14,549
7,150
5,217
4,663
-10.62
Other indirect emissions (Scope 3)
tCO2e
2,446
3,198,317
3,094,768
3,433,201
10.94
Total
tCO2e
6,514,571
12,985,755
14,624,405
16,556,047
13.21
Emissions intensity across the total operation
(kg CO2e/IOO RTK)
80.76
101.8
96.65
93.73
-3.02
Emission intensity in air operations
(kg CO2e/IOO RTK)
80.55
76.67
76.16
74.27
-2.48
Net emissions intensity across the operation
(kg CO2e/IOO RTK)
76.1
97.02
92.19
91.48
-0.78
Emission factors
SOURCE
UNIDAD
VALOR
Jet Fuel
kgCO2/kg
3.16
Jet Fuel
kgCO2e/kg
3.18
Gasoline
kgCO2/TJ
68,700
Diesel
kgCO2/TJ
74,400
Natural gas
kgCO2/TJ
55,600
Liquefied petroleum gas (LPG)
kgCO2/TJ
64,100
› 264
LATAM
GROUP
2024
LATAM
GROUP
2024
› 265
12 / ANNEXES
Significant atmospheric emissions
GRI 305-6 AND 305-7
CSA - SPECIFIC NOX EMISSIONS
UNIDAD
2021
2022
2023
2024
VARIACIÓN
2024/2023
Nitrogen oxides (NOx)
tCO2e
22,184
33,198
39,092
44,573
14%
Intensity in passenger operations
(g/RPK)
0.33
0.325
0.266
0.26
-3%
Intensity in cargo operations
(g/RTK)
1.734
1.718
2.005
2,00
0%
Sulfur oxides (SOx)
tCO2e
983
1,470
1,731
1,974
14%
Intensity in passenger operations
(g/RPK)
0.013
0.014
0.012
0.01
-8%
Intensity in cargo operations
(g/RTK)
0.077
0.085
0.089
0.09
1%
Gases that affect the ozone layer
tCO2e
7,667
11,859
9,712
736
-92%
GHG intensity of the fleet
GHG INTENSITY
UNIT
2021
2022
2023
2024
GHG intensity ratio per passenger
kg CO2e per passenger-kilometer
8.5
9.6
9.1
8.9
GHG intensity index for cargo
kg CO2e per ton-kilometer
25.4
26.6
29.2
28.9
Decarbonization of the aircraft fleet
SASB TR-AL-110A.3
2021
2022
2023
2024
% of use of Sustainable Aviation Fuels (SAF)
0%
0%
0.01%
<1%
FINANCIAL RISKS OF CLIMATE CHANGE
Risk arising from regulatory changes
Based on international risk management methodologies, LATAM group has identified
environmental and regulatory risks. Thus, regulations related to climate change that
could have an impact in the coming years are under constant review. Some of these
regulations include:
⚫ European Union Emissions Trading System (EU-ETS): Since 2012, LATAM group has
been offsetting carbon emissions generated by intra-European flights. In accordance with
Directive (EU) 2023/959, a review is expected in 2026, which could imply the extension
of the scheme.
⚫ ReFuelEU: Mandate requiring fuel suppliers in the European Union (EU) to have a
minimum 2% blend of Sustainable Aviation Fuels (SAF) at EU airports beginning in 2025.
⚫ The Renewable Transport Fuel Obligations (SAF) Order 2024: Mandate requiring UK
fuel suppliers to have a minimum 2% blend of Sustainable Aviation Fuels (SAF) at UK
airports beginning in 2025.
⚫ CORSIA: International aviation emissions offsetting scheme. Although Chile and
Colombia do not currently participate, Ecuador has voluntarily joined the scheme as of
2024. In this context, LATAM group monitors possible new accessions that could affect
its obligations and, likewise, the progress in terms of units eligible for offsetting.
LATAM
GROUP
2024
› 266
12 / ANNEXES
⚫ In Brazil:
- Law No. 14.993, which establishes the National
Sustainable Aviation Fuel program (ProBioQAV):
This draft legislation aims to progressively reduce
greenhouse gas emissions, starting with 1% and
reaching 10%, prioritizing the use of Sustainable
Aviation Fuels (SAF). The scheme would come into
effect in 2027.
- Emissions Trading System: The approval of Bill
2148/2015 provides for the creation of the Brazilian
Emissions Trading System (SBCE, for its Portuguese
acronym). LATAM group is closely monitoring the
development of this legislation, which would initially
require companies that emit more than 25,000 tons
of CO2 per year to offset their emissions.
⚫ In Chile:
- Emissions Trading System: Law 21455 (Framework
Law on Climate Change) establishes the creation of
an emissions trading system, which currently applies
to stationary sources. LATAM Group monitors the
development of these regulations and integrates
compliance with them into its risk management
system.
⚫ In Colombia:
- Emissions Trading System: Law 1931 of 2018
established that the Ministry of Environment must
create a National Greenhouse Gas Emission Quota
Program (PNCTE, for its Spanish acronym) although,
despite the established deadlines, it has not yet
been regulated.
- Carbon tax: Law 1819 of 2016 allowed companies
to offset their emissions to avoid this tax. However,
the 2022 tax reform limited such compensation to
50%, generating an additional cost for companies
with carbon credits that are cheaper than the value
of the tax.
The management of these risks is integrated into and
supervised by the Risk Unit. In accordance with its
risk management policy, LATAM group collaborates
with all key stakeholders, including governments, to
promote public policies based on sound information.
In this context, in alliance with Airbus, LATAM Group
co-financed a study by the Massachusetts Institute
of Technology (MIT), which identifies the best
decarbonization alternatives for the industry in the
countries where the airline operates. In addition,
LATAM group has an ambitious fleet renovation plan
for 2030, a fuel efficiency program (LATAM Fuel
Efficiency), which has been in place since 2010, and a
long-term relationship with the CO2Bio conservation
project, with the aim of offsetting its emissions as
a complementary measure.
TIMEFRAME: 5 years.
RISKS CAUSED BY CHANGES IN PHYSICAL
CLIMATE PARAMETERS OR OTHER EVENTS
RELATED TO CLIMATE CHANGE
Extreme weather events can directly affect LATAM
group’s operations, generating significant interruptions
in air transport services. These disruptions could mainly
result in flight delays or cancellations, problems to
access airports or offices, damage to infrastructure,
and additional repair and maintenance costs.
Along these lines, the physical risks associated
with these events have been assessed within the
framework of the Task Force on Climate-related
Financial Disclosures (TCFD), covering both acute
and chronic risks in the short, medium and long
term. Among the nine risks prioritized under this
framework are extreme temperatures, storms and
heavy rainfall, which are managed by LATAM group's
Risk Management Unit, in accordance with the
guidelines established in its policy. In addition, LATAM
group employs advanced air navigation technology,
such as the Descent Profile Optimization (DPO)
system, which improves planned descent patterns
and suggests more efficient procedures. In addition,
LATAM group works closely with governments in the
various regions to ensure that airports and the entire
aviation value chain are aligned and integrated into
effective climate change mitigation strategies.
TIMEFRAME: 5 years.
FINANCIAL OPPORTUNITIES ARISING FROM
CLIMATE CHANGE
Most significant opportunity
Climate-related opportunities for LATAM group
focus on new regulations and standards, especially
the carbon pricing mechanisms that countries will
implement to meet their Nationally Determined
Contributions (NDCs). In this context, LATAM group
is taking advantage of these opportunities through
strategic alliances, such as its collaboration with the
CO2Bio project, which expects the conservation of
575,000 hectares of savanna floodplains by 2030, and
through the generation of scientific evidence, such as
the MIT study on the decarbonization of aviation. In
addition, LATAM group participates in public-private
forums to stay at the forefront of climate change
policy and scientific advances, enabling it to make
informed strategic decisions.
PLAN FOR ADAPTATION TO THE PHYSICAL
RISKS OF CLIMATE CHANGE
SASB TR-AL-110A.2
LATAM group has assessed physical climate risks—
both acute and chronic—within the framework of the
Task Force on Climate-related Financial Disclosures
(TCFD), considering short-, medium- and long-
term scenarios. This assessment was carried out
based on LATAM group’s specific operation, which
made it possible to identify the main risks and
opportunities—both physical and transitional—in
its key operating locations. For this purpose, 56
of the 154 destinations of the LATAM group were
analyzed at the time of the evaluation, generating
a context adapted to their needs.
In accordance with its risk management policy,
LATAM group manages these risks through its Risk
Management Unit. In addition, it has implemented
advanced air navigation technologies and works
closely with regional governments to integrate
the whole aviation value chain into climate change
mitigation and adaptation strategies. This approach
demonstrates its proactive attitude and commitment
to managing physical climate risks that could impact
its operations.
It is important to note that, as part of its ongoing
work with the authorities, LATAM group actively
monitors the different public policy management
instruments to ensure that they include the necessary
sectoral measures, with a time horizon covering the
short (2025), medium (2030) and long term (2050).
LATAM
GROUP
2024
› 267
12 / ANNEXES
CIRCULAR
ECONOMY
Food waste
I. Programs to measure and reduce the total volume
of food loss and waste.
IN-FLIGHT CATERING
⚫ Reinsertion of non-perishable materials and
sealed foods (< 2023): This process includes the
reuse of snacks, beverages, juices, water, cup
sleeves, condiment sachets, sweeteners, sugar and
cutlery. After a quality check, these non-perishable
materials and foodstuffs are reinserted on the next
flight, minimizing waste caused by overstocking in
operations.
⚫ ITO system (< 2023): An optimization system
designed to manage catering requests on international
and domestic flights. This system is on line with
the host, making it possible to enter and adjust
order requests according to actual flight bookings,
improving accuracy in food loads.
- Zero-Waste Project (Perishable Food): In 2024,
for international flights in Economy with catering
service (fresh food) on flights lasting more than
3.5 hours, it has incorporated the use of artificial
intelligence and historical flight data, making it
possible to more accurately predict the amount
of food to be loaded on each flight. This progress
has reduced overprovisioning from 6% to 2%,
preventing the waste of more than 312,000 fresh
food services, equivalent to 78 tons per year.
- Preselect: This program allows Business cabin
passengers on international routes to select
their preferred catering option 48 to 24 hours
before their flight. In 2024, a pilot program was
implemented on international routes (Santiago
(Chile) - Madrid (Spain)/Miami (United States)/
New York (United States)), focusing on passengers
in the Black Signature category. During this trial
period, improvements in perception, passenger
adherence rate and process functionality were
confirmed.
CANTEENS AND LOUNGES
⚫ Waste measurement and recovery: LATAM group
segregates, weighs and records food waste generated
in its canteens and Lounges in Santiago (Chile)
and Peru, and the lounges in Santiago (Chile) and
Bogota (Colombia), both from the kitchen and from
employees or passengers, as may be the case. This
waste is disposed of through composting, minimizing
the amount sent to landfills.
II. Measurable group-level objectives to reduce the
overall burden of food loss and waste.
IN-FLIGHT CATERING
Following the 2023 assessment, LATAM group set a
target for 2024 to reduce from 6% (212 tons) to 2%
(129 tons) the catering excess (fresh food) from no
shows (when a passenger with a confirmed reservation
does not board the aircraft) on international and
economy class flights.
CANTEENS AND LOUNGES
Organic waste is segregated, weighed and documented
daily before being delivered to the waste manager.
The diversion indicator is calculated on a monthly
basis, by dividing the amount of waste diverted
from landfills (in tons) by the total amount of waste
generated. The Lounge in Santiago (Chile) aims to
achieve a maximum of 10% of waste sent to landfill.
III. Breakdown of food loss and waste volumes by
food category and/or life cycle stage.
IN-FLIGHT CATERING
In 2024, LATAM group measured fresh food waste
on international flights due to catering excess (fresh
food) generated by no shows in economy class. This
is because 529,217 meals were wasted, equivalent
to 133 tons. Of these, 94 tons were from long-haul
flights, with a total of 374,994 meals wasted, while
39 tons came from regional flights, with 154,218
meals wasted.
IV. Programs designed to use food loss and waste
for alternative purposes.
COMPOSTING
In the canteens of the maintenance bases and the
CAE training center in Santiago (Chile) and in the
facilities of Lima (Peru), organic waste generated is
segregated by the employees themselves. In this
program, 240 tons of food waste were composted.
At the maintenance bases in Bogota (Colombia) and
Santiago (Chile), organic waste generated in the canteen
is segregated by the employees themselves. In this
program, 240 tons of food waste were composted.
In addition, in 2024, 172 tons were composted in the
Lounges of Bogota (Colombia) and Santiago (Chile).
V. Collaboration with partners along the value chain
to reduce the amount of food loss and waste.
IN-FLIGHT CATERING
LATAM Group developed a model to reduce catering
excess (fresh food) from no shows in collaboration
with its Information Technology (IT) department and
its catering suppliers. This model aims to optimize
the quantity of prepared food, adjusting the supply
to passengers’ actual needs and minimizing food
waste on international flights.
12 / ANNEXES
CANTEENS AND LOUNGES
Processes to divert waste from landfills and increase
landfill recovery involve the key participation of:
⚫ Canteen and lounge operators, such as Aramark
and Newrest, who have shown willingness to adjust
their processes according to the guidelines established
by LATAM group.
⚫ Intermediaries, including Nueva Pudahuel
(concessionaire), Veolia (waste manager) and Armony
(recovery), who are essential to ensure proper waste
management, including disposal, recovery and
traceability.
Impact of food loss and waste
CSA: PÉRDIDA Y DESPERDICIO DE ALIMENTOS
UNIDAD
2024
Total weight of all food losses and food waste
t
1331
Total weight of food loss and waste volumes used for
alternative purposes
t
2402
Total discarded
t
373
Intensity of food loss and food waste
-
2.8%3
1 Corresponding to the estimate of the weight of food losses and waste generated by overprovisioning in flights.
2 Corresponding to the food waste composted at the Lounges in Santiago (Chile) and Bogota (Colombia), in addition to the canteens of the
maintenance base and the CAE training center in Santiago (Chile) and at facilities in Lima (Peru).
3 Overprovisioning of fresh food on international flights longer than 3.5 hours of flight time, Economy cabin.
› 268
LATAM
GROUP
2024
12 / ANNEXES
EMPLOYEES
Employee profile in 20241
NCG 519: 5.1.1 NUMBER OF INDIVIDUALS BY SEX
GRI 2-7 AND 2- 8; 405-1
SEX OF THE WORKER
NCG 519 - 5.1.1
MEN
% MEN
WOMEN
% WOMEN
Senior Management
58
0.25
11
0.07
Management
434
1.87
233
1.51
Leadership
1,164
5.01
646
4.19
Operators
12.043
51.81
5,818
37.74
Sales force
185
0.80
578
3.75
Administrative staff
355
1.53
492
3.19
Other professionals
1.713
7.37
1,128
7.32
Other technicians
7.294
31.38
6,511
42.23
LATAM group
23.246
100
15,417
100
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
› 269
LATAM
GROUP
2024
LATAM
GROUP
2024
› 270
12 / ANNEXES
Employee profile in 20241
NCG 519: 5.1.2 NUMBER OF INDIVIDUALS BY NATIONALITY
GRI 2-7 AND 2- 8; 405-1
BY NATIONALITY
BRAZIL
CHILE
COLOMBIA
ECUADOR
USA
PERU
H
M
H
M
H
M
H
M
H
M
H
M
Senior Management
13
2
36
5
1
0
0
1
5
1
2
0
Management
97
56
255
135
20
8
5
5
22
12
14
9
Leadership
525
262
416
235
55
34
23
9
50
35
54
37
Operators
7,651
3,242
1,851
959
653
531
124
38
815
241
653
534
Sales Force
79
225
69
264
11
17
3
9
0
1
14
37
Administrative staff
121
134
123
229
36
42
10
18
11
11
27
31
Other professionals
536
382
1,032
634
45
30
5
9
41
20
38
34
Other technicians
3,853
3,169
1,589
1,682
531
476
176
122
2
0
1,114
1,021
LATAM group2
12,875
7,472
5,371
4,143
1,352
1,138
346
211
946
321
1,916
1,703
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
2 In addition to the 38,663 employees, LATAM group's workforce also includes temporary workers hired through outsourced companies for a maximum term of six months to fill vacant positions temporarily due to employee leaves of absence or expiration of external contracts.
LATAM
GROUP
2024
› 271
12 / ANNEXES
Employee profile in 20241
NCG 519: 5.1.2 NUMBER OF INDIVIDUALS BY NATIONALITY
GRI 2-7 AND 2- 8; 405-1
BY NATIONALITY
GERMANY
ARGENTINA
AUSTRALIA
BOLIVIA
CUBA
SPAIN
FRANCE
M
W
M
W
M
M
M
W
M
W
M
W
M
W
Senior Management
0
0
0
0
0
0
0
0
0
0
1
2
0
0
Management
1
0
3
2
1
0
0
0
0
0
11
5
0
0
Leadership
1
0
9
10
0
1
0
1
0
0
12
11
1
1
Operators
12
8
79
84
5
4
18
15
4
2
69
75
7
1
Sales Force
1
1
2
4
0
0
0
0
0
0
1
12
0
2
Administrative staff
1
0
10
7
0
0
0
0
0
0
3
10
0
0
Other professionals
0
1
0
4
0
2
1
0
0
0
13
9
0
2
Other technicians
0
0
0
0
0
0
0
0
0
0
0
0
0
0
LATAM group
16
10
103
111
6
7
19
16
4
2
110
124
8
6
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
BY NATIONALITY
ITALY
MEXICO
NEW ZELAND
THE NETHERLANDS
PARAGUAY
PORTUGAL
UK
M
W
M
W
M
W
M
W
M
W
M
W
M
W
Senior Management
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Management
1
0
0
1
0
0
0
0
3
0
0
0
0
0
Leadership
0
0
6
3
3
0
1
0
5
5
0
0
1
0
Operators
1
6
47
53
5
6
5
1
24
7
3
5
11
2
Sales Force
1
1
0
0
0
0
0
0
2
5
0
0
1
0
Administrative staff
0
0
2
2
0
0
0
0
3
5
0
0
0
0
Other professionals
0
0
1
0
0
1
0
0
0
0
0
0
0
0
Other technicians
0
0
0
0
0
0
0
0
29
41
0
0
0
0
LATAM group
3
7
56
59
8
7
6
1
66
63
3
5
13
2
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
12 / ANNEXES
Employee profile in 20241
NCG 519: 5.1.2 NUMBER OF INDIVIDUALS BY NATIONALITY
GRI 2-7 AND 2- 8; 405-1
BY NATIONALITY
URUGUAY
M
W
Senior Management
0
0
Management
1
0
Leadership
2
2
Operators
4
2
Sales Force
1
0
Administrative staff
7
3
Other professionals
1
0
Other technicians
0
0
LATAM group
16
7
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
› 272
LATAM
GROUP
2024
LATAM
GROUP
2024
› 273
12 / ANNEXES
Employee profile in 20241
NCG 519: 5.1.3 NUMBER OF INDIVIDUALS BY AGE RANGE
GRI 405-1
BY AGE RANGE
UNDER 30 YEARS OLD
FROM 30 TO 40 YEARS OLD
FROM 41 TO 50 YEARS OLD
FROM 51 TO 60 YEARS OLD
FROM 61 TO 70 YEARS OLD
OVER 70 YEARS OLD
M
W
M
W
M
W
M
W
M
W
M
W
Senior Management
0
0
3
0
28
8
20
2
6
1
1
0
Management
1
3
217
136
142
69
64
22
10
3
0
0
Leadership
74
55
498
338
395
193
167
55
29
5
1
0
Operators
3,285
2,587
4,123
2,059
2,973
876
1,352
266
289
30
21
0
Sales Force
26
53
73
215
63
199
19
92
4
19
0
0
Administrative staff
79
94
115
197
103
122
41
70
17
8
0
1
Other professionals
467
349
774
514
305
208
116
53
37
4
14
0
Other technicians
1,261
1,627
2,741
2,646
2,007
1,844
1,055
371
224
23
6
0
LATAM group
5,193
4,768
8,544
6,105
6,016
3,519
2,834
931
616
93
43
1
1 LATAM grouphas no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
NCG 519: 5.1.4 LENGTH OF SERVICE
BY SENIORITY
UNDER 3 YEARS
FROM 3 TO 6 YEARS
MORE THAN 6 AND UP TO 9 YEARS
MORE THAN 9 AND UP TO 12 YEARS
OVER 12 YEARS
M
W
M
W
M
W
M
W
M
W
Senior Management
3
1
3
0
3
1
6
2
43
7
Management
39
20
40
27
48
35
72
48
235
103
Leadership
124
97
159
103
99
58
143
71
639
317
Operators
5,464
3,560
1,986
905
788
357
845
336
2,960
660
Sales Force
58
125
15
42
18
70
34
79
60
262
Administrative staff
139
137
29
53
21
42
34
45
132
215
Other professionals
835
525
263
180
100
86
155
105
360
232
Other technicians
2,525
2,203
1,052
932
431
398
360
434
2,926
2,544
LATAM group
9,187
6,668
3,547
2,242
1,508
1,047
1,649
1,120
7,355
4,340
1 LATAM grouphas no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
LATAM
GROUP
2024
› 274
12 / ANNEXES
Employee profile in 20241
NCG 519: 5.1.5 INDIVIDUALS WITH DISABILITIES
GRI 405-1
INDIVIDUALS WITH
DISABILITIES
M
W
Senior Management
0
0
Management
3
1
Leadership
22
7
Operators
447
172
Sales Force
13
20
Administrative staff
26
17
Other professionals
32
16
Other technicians
7
8
LATAM group
550
241
1 LATAM group has no employees in the "Auxiliary" category as defined by
Chilean NCG No. 519.
Employees by type of contract in 20241
NCG 519: 5.2 LABOR FORMALITY
GRI 2-7 EMPLOYEES
PERMANENT CONTRACT
FIXED-TERM CONTRACT
H
M
H
M
Brazil
12,875
7,472
N/A
N/A
Chile
4,782
3,781
589
362
Colombia
1,156
915
196
223
Ecuador
346
211
N/A
N/A
United States
946
321
N/A
N/A
Peru
1,647
1,329
269
374
Others2
428
421
12
8
LATAM group
22,180
14,450
1,067
967
N/A: Not applicable.
1 LATAM group does not have contracts per job, task or fees.
2 Considering: Argentina, Australia, Bolivia, Costa Rica, Cuba, France, Germany, Italy, Mexico, Netherlands, New Zealand,
Paraguay, Portugal, Spain, South Africa, United Kingdom, and Uruguay and Venezuela.
94.7%
OF THE TOTAL STAFF HAVE AN
INDEFINITE-TERM CONTRACT
95.4% OF THE TOTAL MEN
93.7% OF THE TOTAL WOMEN
5.3%
OF THE TOTAL STAFF HAVE A
FIXED-TERM CONTRACT
4.6% OF THE TOTAL MEN
6.3% OF THE TOTAL WOMEN
Employees by type of contract in 2024
NCG 519: 5.3 WORK ADAPTABILITY
GRI 2-7 EMPLOYEES
FULL-TIME WORKDAY
PART-TIME WORKDAY
H
M
H
M
Brazil
12,668
7,322
207
150
Chile
5,339
4,062
32
81
Colombia
1,352
1,138
N/A
N/A
Ecuador
346
211
N/A
N/A
United States
944
300
2
21
Peru
1,916
1,692
0
11
Others1
411
390
29
39
LATAM group
22,976
15,115
270
302
N/A: Not applicable.
1 Considering: Argentina, Australia, Bolivia, Cuba, France, Germany, Italy, Mexico, Netherlands, New Zealand, Paraguay,
Portugal, Spain, United Kingdom and Uruguay.
98.5%
OF THE TOTAL STAFF HAVE A
FULL-TIME WORKDAY
98.8% OF THE TOTAL MEN
98.0% OF THE TOTAL WOMEN
1.5%
OF THE TOTAL STAFF HAVE A
PART-TIME WORKDAY
1.2% OF THE TOTAL MEN
2.0% OF THE TOTAL WOMEN
LATAM
GROUP
2024
12 / ANNEXES
WORK ADAPTABILITY AGREEMENTS
NCG 519: 5.3 WORK ADAPTABILITY
In 2024, there were no individuals Chile entering
workday adaptability agreements for workers with
family duties or hour ranges for individuals who have
children up to 12 years of age in their care.
4.8%
10.5%
OF THE TOTAL EMPLOYEES EMBRACED
TELEWORK FULL-TIME IN 2024
4.1% OF THE TOTAL MEN
5.8% OF THE TOTAL WOMEN
OF THE TOTAL EMPLOYEES EMBRACED
TELEWORK PART-TIME IN 2024
9.6% OF THE TOTAL MEN
11.7% OF THE TOTAL WOMEN
Telework in 202
NCG 519: 5.3 ADAPTABILIDAD LABORA
GRI 2-7 EMPLOYEES
FULL-TIME TELEWORKERS
PART-TIME TELEWORKERS
Men
Women
Men
Women
Brazil
161
287
780
613
Chile
730
525
1061
836
Colombia
22
18
98
101
Ecuador
3
3
24
35
United States
5
1
111
68
Peru
34
48
80
84
Others1
6
8
77
73
LATAM group
961
890
2,231
1,810
1 Considering: Argentina, Australia, Bolivia, Cuba, France, Germany, Italy, Mexico, Netherlands, New Zealand, Paraguay, Portugal,
Spain, United Kingdom and Uruguay.
NCG 519: 9.SUSTAINABILITY - 9.1 SASB METRICS
SASB TR-AL-310A.1
GRI 2-30
COLLECTIVE BARGAINING
AGREEMENTS IN 20241
NUMBER OF EMPLOYEES
PERCENTAGE OF
TOTAL EMPLOYEES
Employees covered by collective
bargaining agreements
33,456
87%
Unionized employees
17,635
46%
1 In line with SASB recommendations, the maximum number of single employees covered (full and part-time) during the
whole reporting period (01.1.2024 to 12.31.2024) is considered.
Overall, LATAM group’s affiliates adopt their own policies to define working
conditions and terms of employment for employees that are not covered under
collective bargaining agreements. However, there is an exception in Chile where,
since September 2016, and in compliance with current legislation, some basic and
cross-cutting benefits, such as tickets, are extended to new hires, as provided
in a union collective bargaining agreement.
NCG 519: 9.SUSTAINABILITY - 9.1 SASB METRICS
SASB TR-AL-310A.2
During 2024, there were no labor stoppages involving more than a thousand
workers, nor idle days as a result of work stoppages.
Collective bargaining agreements in 2024
› 275
LATAM
GROUP
2024
LATAM
GROUP
2024
› 276
12 / ANNEXES
Pay gap in 2024
CSA – GENDER PAY INDICATORS
INDICATOR
DIFFERENCE BETWEEN
MALE AND FEMALE
EMPLOYEES
Pay gap by gender (average)
95%
Pay gap by gender (median)
95%
Bonus gap (average)
95%
Bonus gap (median)
96%
OTHER INDICATORS OF THE "HUMAN CAPITAL MANAGEMENT"
CRITERIA SUGGESTED BY S&P GLOBAL CSA 2024
Workforce share by nationality in 2024
CSA – WORKFORCE BREAKDOWN BY NATIONALITY
NATIONALITY
OF THE TOTAL WORKFORCE
IN LEADERSHIP POSITIONS
Brazilian
52.9%
39.4%
Chilean
22.3%
35.9%
Colombian
7.3%
6.6%
Ecuadorian
1.7%
2.3%
North American
0.5%
2.2%
Peruvian
9.6%
5.7%
Other1
5.7%
7.9%
Share of female workforce by type of position in 2024
CSA – WORKFORCE BREAKDOWN BY GENDER
LATAM group aims to achieve a gender balance of around 40/60 at all
functional categories by 2030.
SHARE OF WOMEN
2024
Women in total workforce
39.9%
Women in leadership positions (junior, middle and senior)
35.0%
Women in junior leadership positions
35.7%
Women in senior leadership positions
15.9%
Women in leadership positions in revenue-generating functions1
37.0%
Women in STEM22 or related positions
27.3%
1 Support positions such as human capital, legal, information technology, etc., are excluded.
2 Acronym that stands for science, technology, engineering and mathematics-related positions.
Breakdown of new hires in 2024
CSA – BREAKDOWN OF TURNOVER AND HIRING
NEW HIRES BY SEX
Sex
Total
Hiring rate
Men
4,038
59.10%
Women
2,789
40.90%
LATAM group
6,827
100.00%
Turnover breakdown
TURNOVER BY SEX
Sex
Total
Turnover rate
Men
2,244
32.9%
Women
1,527
22.4%
LATAM group
3,771
55.2%
LATAM
GROUP
2024
› 277
12 / ANNEXES
Percentage of individuals who took postnatal leave by country
in 20241
NCG 519: 5.7 POSTNATAL LEAVE
GRI 401-3
COUNTRIES
% MEN
% WOMEN
Germany
100%
100%
Argentina
100%
100%
Australia
N/A
N/A
Bolivia
100%
N/A
Brazil
100%
100%
Chile
100%
100%
Colombia
100%
100%
Cuba
N/A
N/A
Ecuador
100%
100%
Spain
100%
100%
United States
100%
100%
France
N/A
N/A
Italy
N/A
N/A
Mexico
100%
N/A
New Zealand
N/A
N/A
The Netherlands
N/A
N/A
Paraguay
100%
N/A
Peru
100%
100%
Portugal
N/A
N/A
UK
N/A
N/A
Uruguay
100%
N/A
LATAM group
100%
100%
N/A: Not applicable.
1 The percentage is calculated with regard to the total number of people eligible for this leave of absence in 2024.
Use of paternal postnatal leave in chile in 2024
NCG 519: 5.7 POSTNATAL LEAVE
DAYS USED
NUMBER OF WORKING FATHERS
5-day Paternity Leave
82
Parental Postnatal Leave of up to 6 weeks (or less)*
1
*This corresponds to an employee in the “Other Technicians” category, who used 42 days of parental postnatal leave.
Average number of days used by position level1
NCG 519: 5.7 POSTNATAL LEAVE
GRI 401-3
AVERAGE NUMBER OF DAYS USED2
MEN
WOMEN
Senior Management
203
N/A
Management
23
108
Leadership
11
128
Operators
14
115
Sales Force
13
168
Administrative staff
7
98
Other professionals
15
116
Other technicians
11
103
LATAM group
14
119
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
2 The average was calculated based on the average sum of the total number of days for used by all of the group’s workers in
each country, and then the average of days by category.
3 Sólo hubo un caso de postnatal en hombres durante 2024, por lo que se presenta el número de días de postnatal de dicho
caso en Brasil.
POSTNATAL WEEKS - CSA 2024
Around 52.6% of LATAM group employees work in
Brazil. In this country, the legal postnatal leave for
mothers is 120 days, plus another 60 days granted
by the company, for a total of 180 days (25.7 weeks).
This benefit applies both in cases of adoption and
childbirth. Nonetheless, it should be noted that
adoption proceedings are defined by the adoption
agency and, in some cases, it may be necessary to
apply for special permissions.
On the other hand, the legal leave for fathers is 5
days; however, LATAM Brazil grants an additional 15
days as an extra benefit after the birth of the baby,
which equals a total of almost 3 weeks. This policy
applies to same-sex couples as well as to surrogacy
and adoption cases.
In the case of same-sex couples, the partners can
decide the role that each will assume during this
period.
It is important to specify that the definition of
postnatal leave is based on the regulations of each
country.
LATAM
GROUP
2024
12 / ANNEXES
12 / ANEXOS
LONG-TERM EMPLOYEE INCENTIVES
During 2024, as a long-term incentive for employees, LATAM group companies
had a "unit-based payment" program. This comprises units granted to each
employee, which are paid over a period of up to 42 months, and are linked to:
⚫ The employee's permanence in LATAM group.
⚫ The share price compared to the value of the ERO.
⚫ The occurrence of events related to the volume of transactions and liquidity
of the stock.
⚫ Performance defined on the basis of fulfillment of certain company indicators.
This program applies to executives who are not part of the Global Executive
Meeting (GEM)—i.e., who are senior managers, managers and assistant managers
of different LATAM group companies.
Average number of days used per position level in chile in
20241
NCG 519: 5.7 POSTNATAL LEAVE
PAVERAGE NUMBER OF DAYS USED
MEN
WOMEN
Management
5
146
Leadership
5
146
Operators
5
150
Sales Force
5
162
Administrative staff
5
105
Other professionals
5
163
Other technicians
5
140
TOTAL
5
145
1 LATAM Group has no employees in the "Auxiliary" category as defined by Chilean NCG No. 519.
› 278
LATAM
GROUP
2024
LATAM
GROUP
2024
12 / ANNEXES
Employees trained in 2024
NCG 519: 5.8 TRAINING AND BENEFIT
TRAINED
PERSONNEL
M
W
PERCENTAGE (%) OF TOTAL
WORKFORCE
Senior Management
54
11
94.2%
Management
414
226
96.0%
Leadership
1,118
601
95.0%
Operators
11,743
5,686
97.6%
Sales Force
182
563
97.6%
Administrative staff
315
442
89.4%
Other professionals
1,598
1,071
93.9%
Other technicians
6,127
6,248
89.6%
LATAM group
21,551
14,848
94.1%
Average training in 2024
(h/employee)1
NCG 519: 5.8 TRAINING AND BENEFITS| GRI 404-1
GRI 404-1
20241
MEN
WOMEN
Senior Management
7.5
5.7
Management
10.1
9.3
Leadership
27.6
20.7
Operators
46.4
48.8
Sales Force
14.3
15.0
Administrative staff
16.4
11.8
Other professionals
15.9
12.5
Other technicians
46.9
74.9
LATAM group
41.8
53.0
1 The calculation considers the average workforce and LATAM group has no employees
in the "Auxiliary" category as defined by Chilean NCG No. 519.
› 279
LATAM
GROUP
2024
LATAM
GROUP
2024
› 280
12 / ANNEXES
ABOUT THE REPORT
MATERIAL TOPICS FOR VALUE CREATION
Sustainable Innovation
Business Case
LATAM group has the opportunity to be a leader in sustainability by implementing
practices such as waste management and circular economy principles. These innovations
can help it stay ahead of regulatory requirements, enhance its reputation and generate
long-term cost savings. In addition, these measures can attract and retain customers who
align with sustainability values, as well as open up new business opportunities focused on
optimizing resources.
Likewise, involving the value chain will strengthen relations with suppliers and improve
resilience to regulatory changes and consumer demands.
It is important to note that sustainable practices also reinforce the cultural change that
LATAM group has initiated, improving internal cohesion and strengthening corporate
identity.
Impact on the Business
This topic represents an opportunity for LATAM group to lead in sustainability, improve
its reputation, attract customers and achieve cost savings through innovative waste
management and circular economy strategies.
Business Strategy
LATAM group's sustainability strategy is based on collaboration. In fact, it is working
with NGOs, civil society representatives, suppliers and customers to address social,
environmental and economic challenges.
Thus, LATAM group's objectives include reducing waste sent to landfills and eliminating
single-use plastics.
It should be noted that new operational processes and partnerships with suppliers will help
to redefine services, from ground handling to in-flight services.
Goals and Metrics
Thus, LATAM group's objectives include reducing waste sent to landfills and eliminating
single-use plastics. Along this line, LATAM group reduced 97% of single-use plastics by
2024.
Progress on Goals
A 97% reduction was achieved on our single-use plastic objective, continuing with the
previous year's work plan. The remaining 3% corresponds to items not replaced due to
legal, sanitary or operational restrictions. In view of the 2027 target, LATAM developed a
comprehensive assessment of the recoverability potential in the main operations of Bogota
(Colombia), Sao Carlos (Brazil), and Santiago (Chile), added to the technical feasibility and
infrastructure throughout LATAM group's network, and it has decided to update its 2027
target, with which it aims to achieve the diversion of 75% of waste from landfills.
Executive Compensation
The compensation of the LATAM Airlines Group S.A. Director of Corporate Affairs and
Sustainability is linked to the cross-cutting goals of the Climate Change Management
sustainability strategy, particularly on 2 major fronts: 1) elimination of single-use plastics;
and 2) the implementation of the waste management system (10%).
This goal is shared with the CEO of LATAM Cargo.
LATAM
GROUP
2024
› 281
12 / ANNEXES
Climate Change Strategy
Business Case
Climate change poses regulatory risks, such as carbon taxes and emissions trading
systems. Meanwhile, the aviation industry faces the challenge of migrating to sustainable
fuels, which are not yet available in South America.
However, these risks also provide opportunities to collaborate with governments in the
development of sustainable aviation fuels, mitigating dependence on fossil fuels.
It is important to note that the physical risks of climate change, such as extreme weather,
can disrupt operations and affect infrastructure.
Impact on the Business
The climate change strategy is essential for LATAM group, as it mitigates the regulatory
and physical risks of climate change, such as carbon taxes and extreme weather events.
It also provides an opportunity for LATAM group to collaborate in the development of
sustainable aviation fuels and the creation of resilient infrastructure.
Business Strategy
LATAM group participates in conservation initiatives and the purchase of carbon credits,
focusing on reducing deforestation and promoting the development of sustainable fuels.
In addition, it has integrated the recommendations of the Task Force on Climate-Related
Financial Disclosures (TCFD) for the disclosure of climate-related financial risks.
Goals and Metrics
LATAM group has committed to reduce and offset 50% of domestic emissions by 2030 and
to be carbon neutral by 2050.
Progress on Goals
In 2024, emissions totaled 16,556,047 tons of CO2e—up 13.21% from 2023—which,
compared to the consolidated capacity growth of 15.1%, shows an increase in efficiency.
However, in terms of emissions intensity, the total operation recorded a reduction of 3.02%
while, specifically in air operations, the decrease was 2.48%, both figures compared to
2023.
This reduction responds to the significant improvements that LATAM group implemented
in its operational efficiency, including the use of advanced analytics for flight route
optimization and the use of advanced technologies such as AeroShark, which improve the
aerodynamics of its aircraft.
In 2024, LATAM group achieved a reduction of 98,984 tons of CO2e thanks to the LATAM
Fuel Efficiency program and offset 398,043 tons of CO2e through carbon credits from
conservation projects.
LATAM group achieved a 97% reduction in single-use plastics by 2024. The remaining 3%
corresponds to items that could not be replaced for operational, legal or safety reasons.
LATAM continues to make progress in replacing materials with reusable, recyclable or
biodegradable alternatives.
Executive Compensation
The compensation of the LATAM Airlines Group S.A. Director of Corporate Affairs and
Sustainability is linked to the cross-cutting goals of the Climate Change Management
sustainability strategy; linked to fuel efficiency, climate initiatives and conservation
projects (20%). This goal is shared with the CEO of LATAM Cargo.
LATAM
GROUP
2024
› 282
12 / ANNEXES
Fleet Efficiency
Business Case
The renovation of the fleet allows LATAM group to reduce fuel consumption, which
significantly cuts operating costs. Indeed, the integration of advanced technologies
improves fuel efficiency and optimizes flight planning, reducing the risk of delays and
cancellations that can affect revenues and customer satisfaction. In addition, a modern
and well-kept fleet minimizes the risks of operational interruptions due to maintenance,
ensuring a more stable and reliable operation. Likewise, the modernization of the fleet
contributes to the reduction of emissions, supporting LATAM group's sustainability
objectives.
Impact on the Business
Fleet efficiency is essential for LATAM group, as it directly reduces fuel consumption and
operating costs by integrating modern, fuel-efficient aircraft and advanced technologies,
lowering overhead costs and improving profitability.
Business Strategy
LATAM group is implementing a strategic fleet renewal plan, replacing older aircraft with
more fuel-efficient models. In addition, it has developed route planning strategies and
continuously integrates state-of-the-art technologies into its aircraft.
Goals and Metrics
LATAM group aims to reach a fleet of 354 aircraft by 2026.
Progress on Goals
LATAM group ended last year with a fleet of 347 aircraft.
In fact, during 2024, LATAM group received 16 aircraft (three wide-body and 13 narrow-
body).
MATERIAL TOPICS FOR EXTERNAL STAKEHOLDERS
Connectivity and Regional Development
Relevance of the Topic to
External Stakeholders
The connectivity that LATAM group provides fosters tourism throughout South America,
stimulating regional economic development, promoting employment, cultural exchange
and the growth of local economies. In fact, through the Shared Value pillar of its
Sustainability Strategy, LATAM group also contributes to provide access to essential
services through the Avión Solidario program. This initiative leverages LATAM group's
infrastructure, connectivity and transportation capacity to support critical healthcare
needs, such as the transport of medicines, organs, vaccines, as well as professionals and
patients.
Materiality Metrics
In 2024, LATAM group transported 4.074 patients and healthcare professionals,
significantly improving access to treatment and enhancing quality of life through medical
interventions such as transplants. These efforts had a remarkable impact on health
outcomes and lifespan gained.
LATAM
GROUP
2024
12 / ANNEXES
Ecosystem Protection
Relevance of the Topic to
External Stakeholders
As part of the material topic "Climate Change Mitigation," LATAM group also generates a
positive impact on nature and communities through its triple impact program, "CO2BIO."
Unlike other compensation projects, CO2BIO stands out for its ability to generate
environmental, social and economic co-benefits for local communities. In fact, 191 families
are committed to the preservation of a strategic ecosystem covering more than 200,000
hectares that are home to over 2,284 species. These families are certified to trade carbon
credits. CO2BIO provides a unique opportunity to combine skills and resources in the fight
against climate change and achieve LATAM's objective of fully offsetting 100% of its air
and ground handling operations in Colombia. In addition, LATAM group seeks to make
CO2BIO a competitive project for access to the international voluntary carbon market.
Materiality Metrics
LATAM group's efforts resulted in the conservation of more than 270,000 hectares, which
significantly impacted wildlife preservation. This achievement is valued for its contribution
to the protection of approximately 2,000 species.
› 283
LATAM
GROUP
2024
LATAM
GROUP
2024
› 284
13 / FINANCIAL STATEMENTS
13
_FINANCIAL STATEMENTS
285 FINANCIAL STATEMENTS
372 AFFILIATES AND SUBSIDIARIES
410 FINANCIAL ANALYSIS
418 SWORN STATEMENT
419 CORPORATE STRUCTURE
› 285
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Atlanta, Estados Unidos
FINANCIAL STATEMENTS
NCG 519: 12. INFORMES FINANCIEROS
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2024
CONTENTS
Consolidated Statements of Financial Position
Consolidated Statements of Income by Function
Consolidated Statements of Comprehensive Income
Consolidated Statements of Changes in Equity
Consolidated Statements of Cash Flows - Direct Method
Notes to the Consolidated Financial Statements
CLP
-
CHILEAN PESO
UF
-
CHILEAN UNIDAD DE FOMENTO
ARS
-
ARGENTINE PESO
US$
-
UNITED STATES DOLLAR
THUS$ -
THOUSANDS OF UNITED STATES DOLLARS
MUS$
-
MILLIONS OF UNITED STATES DOLLARS
COP
-
COLOMBIAN PESO
BRL/R$ -
BRAZILIAN REAL
THR$
- THOUSANDS OF BRAZILIAN REAL
PYG
- PARAGUAYAN GUARANI
› 286
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
REPORT OF INDEPENDENT AUDITORS
(A free translation from the original in Spanish)
Santiago, January 30, 2025
To the Board of Directors and Shareholders
LATAM Airlines Group S.A.
Opinion
We have audited the consolidated financial statements of LATAM Airlines Group S.A. and subsidiaries,
which comprise the consolidated statements of financial position as of December 31, 2024 and 2023
and the related consolidated statements of income by function, comprehensive income, changes in
equity and cash flows direct method for the years then ended and the related notes to the consolidated
financial statements.
In our opinion, the accompanying consolidated financial statements present fairly, in all material
respects, the financial position of LATAM Airlines Group S.A. and subsidiaries as of December 31, 2024
and 2023, the results of its operations and its cash flows for the years then ended in accordance with
International Financial Reporting Standards as issued by the International Accounting Standards
Board.
Basis for Opinion
We conducted our audits in accordance with Generally Accepted Auditing Standards in Chile. Our
responsibilities under those standards are further described in the Auditor’s responsibility for the audit
of the consolidated financial statements section of our report. We are required to be independent of
LATAM Airlines Group S.A. and subsidiaries and to meet our other ethical responsibilities, in
accordance with the relevant ethical requirements relating to our audits. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Consolidated Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with International Financial Reporting Standards issued by the International
Accounting Standards Board, and for the design, implementation, and maintenance of internal control
relevant to the preparation and fair presentation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing and presenting the consolidated financial statements, management is required to evaluate
whether there are facts or circumstances that, taken as a whole, raise substantial doubt about LATAM
Airlines Group S.A. and subsidiary’s ability to continue as a going concern for at least, but not limited
to, twelve months from the end of the reporting period.
Santiago, January 30, 2025
LATAM Airlines Group S.A.
2
Auditor’s responsibility for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's
report that includes our opinion. Reasonable assurance is a high, but not absolute, level of assurance
and, therefore, does not guarantee that an audit performed in accordance with Generally Accepted
Auditing Standards in Chile will always detect a material misstatement when it exists. The risk of not
detecting a material misstatement due to fraud is greater than the risk of not detecting a material
misstatement due to error, as fraud may involve collusion, forgery, intentional omissions, concealment,
misrepresentations or disregard of controls by Management. A misstatement is considered material if,
individually or in the aggregate, it would influence the judgment of a reasonable user based on these
consolidated financial statements.
As part of an audit conducted in accordance with Generally Accepted Auditing Standards in Chile, we:
●
Exercise our professional judgment and maintain our professional skepticism throughout the
audit.
●
Identify and assess the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error; we design and perform audit procedures in response to those risks.
Such procedures include examining evidence, on a test basis, regarding the amounts and
disclosures in the consolidated financial statements.
●
Obtain an understanding of internal control relevant to an audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of LATAM Airlines Group S.A. and subsidiary’s internal control. Consequently, we do
not express such an opinion.
●
We assess the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by Management, as well as assessing the appropriateness of the overall
presentation of the consolidated financial statements.
●
We conclude whether in our judgment there are facts or circumstances that, taken as a whole, cast
substantial doubt about the ability of LATAM Airlines Group S.A. and subsidiaries to continue as a
going concern for the foreseeable future.
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Paris, Francia
GRUPO
LATAM
2024
› 287
Santiago, January 30, 2025
LATAM Airlines Group S.A.
3
We are required to communicate to those charged with governance, among other matters, the planned
timing and scope of the audit and significant audit findings, including any significant deficiencies and
material weaknesses in internal control that we identify during our audit.
Jonathan Yeomans Gibbons
RUT: 13.473.972-K
› 288
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Contents of the Notes to the consolidated financial statements of LATAM Airlines Group S.A. and Subsidiaries.
Notes
Page
1 - General information.................................................................................................................................. 1
2 - Summary of significant accounting policies ............................................................................................ 7
2.1. Basis of Preparation ........................................................................................................................... 7
2.2. Basis of Consolidation ...................................................................................................................... 10
2.3. Foreign currency transactions ........................................................................................................... 11
2.4. Property, plant and equipment .......................................................................................................... 12
2.5. Intangible assets other than goodwill ................................................................................................12
2.6. Borrowing costs ................................................................................................................................ 12
2.7. Losses for impairment of non-financial assets ................................................................................. 13
2.8. Financial assets ................................................................................................................................. 13
2.9. Derivative financial instruments and embedded derivatives ............................................................ 13
2.10. Inventories....................................................................................................................................... 15
2.11. Trade and other accounts receivable .............................................................................................. 15
2.12. Cash and cash equivalents .............................................................................................................. 15
2.13. Capital ............................................................................................................................................. 15
2.14. Trade and other accounts payables ................................................................................................. 15
2.15. Interest-bearing loans ...................................................................................................................... 15
2.16. Current and deferred taxes .............................................................................................................. 16
2.17. Employee benefits .......................................................................................................................... 17
2.18. Provisions ....................................................................................................................................... 17
2.19. Revenue from contracts with customers ......................................................................................... 18
2.20. Leases ............................................................................................................................................. 19
2.21. Non-current assets (or disposal groups) classified as held for sale................................................. 20
2.22. Maintenance .................................................................................................................................... 20
2.23. Environmental costs ........................................................................................................................ 20
3 - Financial risk management ..................................................................................................................... 20
3.1. Financial risk factors ........................................................................................................................ 20
3.2. Capital risk management .................................................................................................................. 33
3.3. Estimates of fair value ...................................................................................................................... 33
4 - Accounting estimates and judgments...................................................................................................... 35
5 - Segment information .............................................................................................................................. 38
6 - Cash and cash equivalents ...................................................................................................................... 39
7 - Financial instruments ............................................................................................................................. 40
8 - Trade and other accounts receivable current, and non-current accounts receivable .............................. 41
9 - Accounts receivable from/payable to related entities ............................................................................ 43
10 - Inventories ............................................................................................................................................ 44
11 - Other financial assets ........................................................................................................................... 45
12 - Other non-financial assets .................................................................................................................... 46
13 - Non-current assets and disposal group classified as held for sale......................................................... 47
14 - Investments in subsidiaries .................................................................................................................. 48
15 - Intangible assets other than goodwill ................................................................................................... 51
16 - Property, plant and equipment .............................................................................................................. 53
17 - Current and deferred tax ....................................................................................................................... 58
18 - Other financial liabilities ...................................................................................................................... 62
19 - Trade and other accounts payables ....................................................................................................... 71
20 - Other provisions.................................................................................................................................... 72
21 - Other non financial liabilities ............................................................................................................... 73
22 - Employee benefits ................................................................................................................................ 74
23 - Accounts payable, non-current ............................................................................................................ 77
24 - Equity ................................................................................................................................................... 78
25 - Revenue ................................................................................................................................................ 85
26 - Costs and expenses by nature ............................................................................................................... 85
27 - Other income, by function ................................................................................................................... 86
28 - Foreign currency and exchange rate differences ................................................................................. 87
29 - Earnings per share................................................................................................................................ 93
30 - Contingencies ..................................................................................................................................... 94
31 - Commitments ..................................................................................................................................... 123
32 - Transactions with related parties ........................................................................................................ 126
33 - Share based payments ....................................................................................................................... 128
34 - Statement of cash flows ...................................................................................................................... 131
35 - The environment ................................................................................................................................ 134
36 - Events subsequent to the date of the financial statements .................................................................. 137
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
ASSETS
Note
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Current Assets
Cash and cash equivalents
6 - 7
1,957,788
1,714,761
Other financial assets
7 - 11
67,295
174,819
Other non-financial assets
12
203,661
185,264
Trade and other accounts receivable
7 - 8
1,163,707
1,385,910
Accounts receivable from related entities
7 - 9
25
28
Inventories
10
438,530
592,880
Current tax assets
17
40,275
47,030
Total current assets other than non-current assets (or disposal groups)
classified as held for sale
3,871,281
4,100,692
Non-current assets (or disposal groups) classified as held for sale
13
29,138
102,670
Total current assets
3,900,419
4,203,362
Non-current assets
Other financial assets
7 - 11
53,772
34,485
Other non-financial assets
12
89,416
168,621
Accounts receivable
7 - 8
12,342
12,949
Intangible assets other than goodwill
15
1,000,170
1,151,986
Property, plant and equipment
16
10,186,697
9,091,130
Deferred tax assets
17
10,549
4,782
Total non-current assets
11,352,946
10,463,953
Total assets
15,253,365
14,667,315
The accompanying Notes 1 to 36 form an integral part of these consolidated financial statements.
› 289
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
LIABILITIES AND EQUITY
LIABILITIES
Note
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Current liabilities
Other financial liabilities
7 - 18
635,213
596,063
Trade and other accounts payables
7 - 19
2,133,572
1,765,279
Accounts payable to related entities
7 - 9
12,875
7,444
Other provisions
20
14,221
15,072
Current tax liabilities
17
6,281
2,371
Other non-financial liabilities
21
3,488,680
3,301,906
Total current liabilities
6,290,842
5,688,135
Non-current liabilities
Other financial liabilities
7 - 18
6,515,238
6,341,669
Accounts payable
7 - 23
491,762
418,587
Other provisions
20
623,846
926,736
Deferred tax liabilities
17
312,677
382,359
Employee benefits
22
167,427
122,618
Other non-financial liabilities
21
140,244
348,936
Total non-current liabilities
8,251,194
8,540,905
Total liabilities
14,542,036
14,229,040
EQUITY
Share capital
24
5,003,534
5,003,534
Retained earnings
24
1,148,291
464,411
Other equity
24
39
39
Other reserves
24
(5,428,597)
(5,017,682)
Parent’s ownership interest
723,267
450,302
Non-controlling interest
14
(11,938)
(12,027)
Total equity
711,329
438,275
Total liabilities and equity
15,253,365
14,667,315
The accompanying Notes 1 to 36 form an integral part of these consolidated financial statements.
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME BY FUNCTION
For the year ended December 31,
Note
2024
2023
ThUS$
ThUS$
Revenue
5 - 25
12,833,043
11,640,541
Cost of sales
26
(9,565,899)
(8,816,590)
Gross margin
3,267,144
2,823,951
Other income
27
200,669
148,641
Distribution costs
26
(606,207)
(587,272)
Administrative expenses
26
(824,493)
(683,311)
Other expenses
26
(459,842)
(532,801)
Other gains/(losses)
26
(36,223)
(91,043)
Income from the operational activities
1,541,048
1,078,165
Financial income
26
142,411
125,356
Financial costs
26
(881,950)
(698,231)
Foreign exchange gains
172,917
85,891
Result of indexation units
19,508
5,311
Income before taxes
993,934
596,492
Income tax benefits/(expense)
17
(16,489)
(14,942)
NET INCOME FOR THE YEAR
977,445
581,550
Income attributable to owners of the parent company
976,972
581,831
Income (Loss) attributable to non-controlling interest
14
473
(281)
NET INCOME FOR THE YEAR
977,445
581,550
EARNING PER SHARE
Basic earnings per share (US$)
29
0.001616
0.000963
Diluted earnings per share (US$)
29
0.001616
0.000963
The accompanying Notes 1 to 36 form an integral part of these consolidated financial statements.
› 290
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the year ended at December 31,
Note
2024
2023
ThUS$
ThUS$
NET INCOME FOR THE YEAR
977,445
581,550
Components of other comprehensive income (loss) that will not be reclassified to income
before taxes
Other comprehensive (loss), before taxes, gains (losses) by new measurements on defined
benefit plans
24
(21,769)
(21,198)
Total other comprehensive income (loss) that will not be reclassified to income before taxes
(21,769)
(21,198)
Components of other comprehensive income that will be reclassified to income before taxes
Currency translation differences income (losses) on currency translation, before tax
(379,186)
(12,423)
Other comprehensive income (loss), before taxes, currency translation differences
(379,186)
(12,423)
Cash flow hedges
Gains (losses) on cash flow hedges before taxes
24
14,681
(41,144)
Reclassification adjustment on cash flow hedges before tax
24
(40,898)
(26,568)
Amounts removed from equity and included in the carrying amount of non-financial
assets (liabilities) that were acquired or incurred through a highly probable hedged
forecast transaction, before tax
24
11,999
(11,112)
Other comprehensive income (losses), before taxes, cash flow hedges
(14,218)
(78,824)
Change in value of time value of options
Gains/(Losses) on change in value of time value of options before tax
24
(34,568)
25,751
Reclassification adjustments on change in value of time value of options before tax
24
37,265
28,818
Other comprehensive income (loss), before taxes, changes in the time value of the
options
2,697
54,569
Total other comprehensive losses that will be reclassified to losses before taxes
(390,707)
(36,678)
Other components of other comprehensive income (loss), before taxes
(412,476)
(57,876)
Income tax relating to other comprehensive income that will not be reclassified to income
Income tax relating to new measurements on defined benefit plans
17
909
751
Income tax relating to other comprehensive income that will not be reclassified to income
909
751
Income tax relating to other comprehensive income (loss) that will be reclassified to income
Income tax related to cash flow hedges in other comprehensive income (loss)
17
—
3,604
Income taxes related to components of other comprehensive loss will be reclassified to
income
—
3,604
Total Other comprehensive income (loss)
(411,567)
(53,521)
Total comprehensive income (loss)
565,878
528,029
Comprehensive income (loss) attributable to owners of the parent company
565,547
515,687
Comprehensive income (loss) attributable to non-controlling interests
331
12,342
TOTAL COMPREHENSIVE INCOME
565,878
528,029
The accompanying Notes 1 to 36 form an integral part of these consolidated financial statements.
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Attributable to owners of the parent
Change in other reserves
Note
Share
capital
Other
equity
Treasury
shares
Currency
translation
reserve
Cash flow
hedging
reserve
Gains
(Losses)
from
changes
in the time
value of the
options
Actuarial
gains
or losses on
defined
benefit
plans
reserve
Shares
based
payments
reserve
Other
sundry
reserve
Total
other
reserve
Retained
earnings/
(losses)
Parent’s
ownership
interest
Non-
controlling
interest
Total
equity
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Equity as of January 1,
2024
5,003,534
39
—
(3,830,611)
(38,678)
32,947
(48,559)
37,235
(1,170,016) (5,017,682)
464,411
450,302
(12,027)
438,275
Total increase (decrease)
in equity
Net income for the
period
24
—
—
—
—
—
—
—
—
—
—
976,972
976,972
473
977,445
Other comprehensive
income (loss)
—
—
—
(379,049)
(14,218)
2,697
(20,855)
—
—
(411,425)
—
(411,425)
(142)
(411,567)
Total comprehensive
income
—
—
—
(379,049)
(14,218)
2,697
(20,855)
—
—
(411,425)
976,972
565,547
331
565,878
Transactions with
shareholders
Dividends
24
—
—
—
—
—
—
—
—
—
—
(293,092)
(293,092)
—
(293,092)
Increase (decrease)
through transfers and
other changes, equity
24-34
—
—
—
—
—
—
—
—
510
510
—
510
(242)
268
Total transactions with
shareholders
—
—
—
—
—
—
—
—
510
510
(293,092)
(292,582)
(242)
(292,824)
Closing balance as of
December 31, 2024
5,003,534
39
—
(4,209,660)
(52,896)
35,644
(69,414)
37,235
(1,169,506) (5,428,597) 1,148,291
723,267
(11,938)
711,329
The accompanying Notes 1 to 36 form an integral part of these consolidated financial statements.
› 291
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Attributable to owners of the parent
Change in other reserves
Note
Share
capital
Other
equity
Treasury
shares
Currency
translation
reserve
Cash flow
hedging
reserve
Gains
(Losses)
from
changes
in the time
value of the
options
Actuarial
gains
or losses on
defined
benefit
plans
reserve
Shares
based
payments
reserve
Other
sundry
reserve
Total
other
reserve
Retained
earnings/
(losses)
Parent’s
ownershi
p
interest
Non-
controlling
interest
Total
equity
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Equity as of January 1,
2023
13,298,486
39
(178) (3,805,560)
36,542
(21,622)
(28,117)
37,235
(1,972,651) (5,754,173) (7,501,896)
42,278
(11,557)
30,721
Total increase (decrease)
in equity
Net income/(loss) for
the period
24
—
—
—
—
—
—
—
—
—
—
581,831
581,831
(281) 581,550
Other comprehensive
income
—
—
—
(25,051)
(75,220)
54,569
(20,442)
—
—
(66,144)
—
(66,144)
12,623
(53,521)
Total comprehensive
income
—
—
—
(25,051)
(75,220)
54,569
(20,442)
—
—
(66,144)
581,831
515,687
12,342
528,029
Transactions with
shareholders
Dividends
24
—
—
—
—
—
—
—
—
—
—
(174,549) (174,549)
—
(174,549)
Increase for other
contributions from
the owners
24
—
17,401
—
—
—
—
—
—
(14,401)
(14,401)
—
3,000
—
3,000
Increase (decrease)
through transfers and
other changes, equity
24 -33
(8,294,952)
(17,401)
178
—
—
—
—
—
817,036
817,036
7,559,025
63,886
(12,812)
51,074
Total transactions with
shareholders
(8,294,952)
—
178
—
—
—
—
—
802,635
802,635
7,384,476
(107,663)
(12,812) (120,475)
Closing balance as of
December 31, 2023
5,003,534
39
—
(3,830,611)
(38,678)
32,947
(48,559)
37,235
(1,170,016) (5,017,682)
464,411
450,302
(12,027) 438,275
The accompanying Notes 1 to 36 form an integral part of these consolidated financial statements.
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS - DIRECT METHOD
For the year ended
December 31,
Note
2024
2023
ThUS$
ThUS$
Cash flows from operating activities
Cash collection from operating activities
Proceeds from sales of goods and services
14,037,848 13,397,385
Other cash receipts from operating activities
212,750
169,692
Payments for operating activities
Payments to suppliers for the supply goods and services
(9,458,249) (9,689,508)
Payments to and on behalf of employees
(1,419,825) (1,304,696)
Other payments for operating activities
(344,911)
(270,580)
Income taxes (paid)
(43,439)
(18,379)
Other cash inflows (outflows)
34
122,153
(20,346)
Net cash (outflow) inflow from operating activities
3,106,327 2,263,568
Cash flows from investing activities
Amounts raised from sale of property, plant and equipment
97,303
46,524
Purchases of property, plant and equipment
34
(1,325,463)
(795,787)
Purchases of intangible assets
34
(94,412)
(68,052)
Interest received
118,437
98,552
Other cash inflows (outflows)
34
34,469
59,258
Net cash (outflow) inflow from investing activities
(1,169,666)
(659,505)
Cash flows inflow (out flow) from financing activities
Payments for changes in ownership interests in subsidiaries that do not result in loss of control
24
—
(23)
Amounts raised from long-term loans
34
1,750,060
—
Loans repayments
34
(2,004,542)
(342,005)
Payments of lease liabilities
34
(344,038)
(225,358)
Dividends paid
34
(174,838)
—
Interest paid
34
(717,634)
(594,234)
Other cash (outflows) inflows
34
(73,869)
11,405
Net cash inflow (outflow) from financing activities
(1,564,861) (1,150,215)
Net (decrease) increase in cash and cash equivalents before effect of exchanges rate change
371,800
453,848
Effects of variation in the exchange rate on cash and cash equivalents
(128,773)
44,238
Net (decrease) increase in cash and cash equivalents
243,027
498,086
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
6
1,714,761 1,216,675
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
6
1,957,788 1,714,761
The accompanying Notes 1 to 36 form an integral part of these consolidated financial statements.
› 292
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM AIRLINES GROUP S.A. AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2024
NOTE 1 - GENERAL INFORMATION
LATAM Airlines Group S.A. (“LATAM” or the "Company") is an open stock company which holds the values
inscribed in the Registro de Valores of the Commission for the Financial Market, whose shares are listed in
Chile on the Electronic Stock Exchange of Chile - Stock Exchange and the Santiago Stock Exchange.
Additionally, during the third quarter of 2024, it relisted its American Depositary Receipts ("ADRs") on the
New York Stock Exchange ("NYSE") in the United States of America.
Its main business is the air transport of passengers and cargo, both in the domestic markets of Chile, Peru,
Colombia, Ecuador and Brazil, as well as in a series of regional and international routes in America, Europe and
Oceania. These businesses are developed directly or by its subsidiaries in Chile, Ecuador, Peru, Brazil,
Colombia and Paraguay. In addition, the Company has subsidiaries that operate in the cargo business in Chile,
Brazil and Colombia.
The Company is located in Chile, in the city of Santiago, on Avenida Presidente Riesco No. 5711, Las Condes
commune.
As of December 31, 2024, the Company's statutory capital is represented by 604,441,789,335 ordinary shares
without nominal value. As of that date, 604,437,877,587 shares were subscribed and paid. The foregoing,
considering the capital increase approved by the shareholders of the company at an extraordinary meeting held
on July 5, 2022, in the context of the implementation of its reorganization plan approved and confirmed in the
Chapter 11 Proceedings, as well as the Capital decrease required for the Chilean Capital Markets law that
appears in a public deed dated September 6, 2023, granted at the Notaría of Santiago of Mr. Eduardo Javier
Diez Morello, and the modification of the Company's bylaws to account for said full capital reduction, agreed at
an Extraordinary Shareholders meeting dated April 25, 2024, reduced to a public deed dated April 25, 2024,
granted in the Notary of Santiago of Mr. Luis Eduardo Rodriguez Burr, an extract of which was registered in the
Commercial Registry of the Registrar of Real Estate of Santiago on page 44,323 number 18,314 corresponding
to the year 2024, and was published in the Official Gazette dated May 29, 2024.
The major shareholders of the Company, considering the total amount of subscribed and paid shares, are Banco
de Chile on behalf of State Street which owns 25.93%, Delta Air Lines with 10.05% and Qatar Airways with
10.03% ownership.
As of December 31, 2024, the Company had a total of 2,131 shareholders in its registry. At that date,
approximately 22.68% of the Company's capital stock was in the form of ADRs.
During 2024, the Company had an average of 37,355 employees, ending this year with a total of 38,664
collaborator, distributed in 5,576 Administration employees, 19,307 in Operations, 9,288 Cabin Crew and 4,493
Command crew.
The main subsidiaries included in these consolidated financial statements are as follows:
a)
Percentage ownership
Tax No.
Company
Country
of origin
Functional
Currency
As December 31, 2024
As December 31, 2023
Direct
Indirect
Total
Direct
Indirect
Total
%
%
%
%
%
%
96.969.680-0
Lan Pax Group S.A. and Subsidiaries
Chile
US$
99.9959
0.0041
100.0000
99.9959
0.0041
100.0000
Foreign
Latam Airlines Perú S.A.
Peru
US$
23.6200
76.1900
99.8100
23.6200
76.1900
99.8100
93.383.000-4
Lan Cargo S.A.
Chile
US$
99.8940
0.0041
99.8981
99.8940
0.0041
99.8981
76.717.244-3
Prime Cargo SpA.
Chile
CLP
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
Foreign
Connecta Corporation
U.S.A.
US$
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
Foreign
Prime Airport Services Inc. and Subsidiary
U.S.A.
US$
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
96.951.280-7
Transporte Aéreo S.A.
Chile
US$
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
96.631.520-2
Fast Air Almacenes de Carga S.A.
Chile
CLP
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
Foreign
Laser Cargo S.R.L. (*)
Argentina
ARS
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
96.969.690-8
Lan Cargo Inversiones S.A. and Subsidiary
Chile
US$
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
96.575.810-0
Inversiones Lan S.A.
Chile
US$
99.9000
0.1000
100.0000
99.9000
0.1000
100.0000
96.847.880-K
Technical Training LATAM S.A.
Chile
CLP
99.8300
0.1700
100.0000
99.8300
0.1700
100.0000
Foreign
Latam Finance Limited
Cayman Island
US$
100.0000
0.0000
100.0000
100.0000
0.0000
100.0000
Foreign
Peuco Finance Limited (*)
Cayman Island
US$
100.0000
0.0000
100.0000
100.0000
0.0000
100.0000
Foreign
Professional Airline Services INC.
U.S.A.
US$
100.0000
0.0000
100.0000
100.0000
0.0000
100.0000
Foreign
Jarletul S.A.
Uruguay
US$
0.0000
100.0000
100.0000
0.0000
100.0000
100.0000
Foreign
Latam Travel S.R.L.
Bolivia
US$
99.0000
1.0000
100.0000
99.0000
1.0000
100.0000
76.262.894-5
Latam Travel Chile II S.A.
Chile
US$
99.9900
0.0100
100.0000
99.9900
0.0100
100.0000
Foreign
Latam Travel S.A.
Argentina
ARS
94.0100
5.9900
100.0000
94.0100
5.9900
100.0000
Foreign
Faisán Finance DAC (*)
Ireland
US$
100.0000
0.0000
100.0000
0.0000
0.0000
0.0000
Foreign
TAM S.A. and Subsidiaries (**)
Brazil
BRL
63.0987
36.9013
100.0000
63.0987
36.9013
100.0000
(*)
These subsidiaries have no operations.
(**) As of December 31, 2024, the indirect participation percentage of TAM S.A. and its Subsidiaries is
from Holdco I S.A., a company which LATAM Airlines Group S.A. has a 100% share on economic rights and
51.04% of political rights. Its percentage arose as a result of the provisional measure No. 863 of the Brazilian
government implemented in December of 2018 that allows foreign capital to have up to 100% of the share
ownership of a Brazilian Airline.
› 293
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
b)
Financial Information
Statement of financial position
Net Income
For the year ended
December 31,
As of December 31, 2024
As of December 31, 2023
2024
2023
Tax No.
Company
Assets
Liabilities
Equity
Assets
Liabilities
Equity
Gain /(loss)
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
96.969.680-0
Lan Pax Group S.A. and Subsidiaries (*)
462,748
1,933,499
(1,092,261) 487,236
1,835,537
(1,000,622) (122,763)
7,514
Foreign
Latam Airlines Perú S.A.
437,768
366,089
16,930
334,481
285,645
48,836
22,861
(4,666)
93.383.000-4
Lan Cargo S.A.
490,550
263,747
226,803
391,430
189,019
202,411
27,238
22,677
76.717.244-3
Prime Cargo SpA.
14,806
14,844
(38)
912
—
912
(813)
—
Foreign
Connecta Corporation
47,583
15,255
32,328
64,054
6,790
57,264
(5,936)
693
Foreign
Prime Airport Services Inc. and Subsidiary (*)
18,752
15,582
3,169
19,435
17,241
2,194
977
1,380
96.951.280-7
Transporte Aéreo S.A.
238,354
121,609
116,745
280,117
151,066
129,051
(10,064) 24,871
96.631.520-2
Fast Air Almacenes de Carga S.A.
25,783
19,771
6,005
14,255
10,455
3,800
3,675
462
Foreign
Laser Cargo S.R.L.
—
-
—
—
1
(1)
—
—
96.969.690-8
Lan Cargo Inversiones S.A. and Subsidiary (*)
208,807
116,796
(66,907) 166,503
80,502
(71,744)
6,010
(5,345)
96.575.810-0
Inversiones Lan S.A.
1,184
48
1,136
1,238
50
1,188
(53)
(36)
96.847.880-K
Technical Training LATAM S.A.
1,238
740
498
1,246
893
353
205
165
Foreign
Latam Finance Limited
112
208,620
(208,508)
114
208,621
(208,507)
(1)
(1)
Foreign
Professional Airline Services INC.
8,508
1,660
6,848
15,571
10,943
4,628
1,960
1,681
Foreign
Jarletul S.A.
12
1,101
(1,089)
16
1,101
(1,085)
(4)
8
Foreign
Latam Travel S.R.L.
93
—
93
92
—
92
—
5
76.262.894-5
Latam Travel Chile II S.A.
358
1,243
(885)
356
1,239
(883)
(2)
(16)
Foreign
Latam Travel S.A.
3,847
1,623
2,091
4,547
1,554
2,993
(3,563)
940
Foreign
Faisán Finance DAC
—
—
—
—
—
—
—
—
Foreign
TAM S.A. and Subsidiaries (*)
4,070,469
2,557,042
1,512,327
4,239,702
3,027,373
1,212,329
673,648
740,783
(*)
The Equity reported corresponds to Equity attributable to owners of the parent company, it does not
include Non-controlling participation.
In addition, the following special purpose entities have been consolidated: (1) Chercán Leasing Limited,
intended to finance advance payments of aircraft; (2) Guanay Finance Limited, intended for the issue of a
securitized bond with future credit card payments (Liquidated in May 2023); (3) Yamasa Sangyo Aircraft LA1
Kumiai, Yamasa Sangyo Aircraft LA2 Kumiai; and (4) Jun Shan 16, earmarked for aircraft financing. These
companies have been consolidated as required by IFRS 10.
All entities over which LATAM has control have been included in the consolidation. The Company has
analyzed the control criteria in accordance with the requirements of IFRS 10.
Changes occurred in the consolidation perimeter between January 1, 2023 and December 31, 2024, are detailed
below:
(1)
Incorporation or acquisition of companies
-
On March 29, 2023, a capital increase was made in TAM S.A. carried out a capital increase,
through the contribution of LATAM Airlines Group S.A. of accounts receivable for
ThUS$785,865; consequently, there were no significant changes in the shareholder composition
and therefore did not generate any effect within the Consolidated Financial Statements.
-
On March 29, 2023, a capital increase was made in TAM Linheas Aéreas S.A carried out a
capital increase, through the contribution of TAM S.A. of accounts receivable for
ThUS$785,865; consequently, there were no significant changes in the shareholder composition
and therefore did not generate any effect within the Consolidated Financial Statements.
3
-
On March 29, 2023, a capital increase was made in Aerovías de Integración Regional S.A.
through the contribution of made a capital increase where Holdco Colombia I SpA made a
contribution through accounts receivable for ThUS$120,410 and with a premiums for the
issuance of shares, consequently, there were no significant changes in the shareholder
composition.
-
On April 14, 2023, a capital reduction was carried out in Lan Argentina S.A. through the
absorption of losses in the sum of ThUS$160,170. Consequently, there were no significant
changes in the shareholding composition and therefore it did not generate any effect within the
Consolidated Financial Statements.
-
On June 7, 2023, a capital increase was made in TAM S.A. carried out a capital increase, through
the contribution of LATAM Airlines Group S.A. of accounts receivable for ThUS$308,031,
consequently, there were no significant changes in the shareholder composition and therefore did
not generate any effect within the Consolidated Financial Statements.
-
On June 7, 2023, a capital increase was made in TAM Linheas Aéreas S.A carried out a capital
increase, through the contribution of TAM S.A. of accounts receivable for ThUS$308,031,
consequently, there were no significant changes in the shareholder composition and therefore did
not generate any effect within the Consolidated Financial Statements.
-
On June 13 and 14, 2023, Inversiones Lan S.A. made a purchase of 923 shares from third parties,
for an a total amount of ThUS$23, of the subsidiary Aerovías de Integración Regional S.A.,
consequently, these transactions generated a decrease in the non-controlling interest, without
generating significant effects on the Consolidated Financial Statements.
-
On July 21, 2023, a capital increase was carried out in Latam Airlines Ecuador S.A through the
contribution of accounts receivable held by Holdco Ecuador S.A for ThUS$3,100, consequently,
there were no significant changes in the shareholding composition and Therefore, it did not
generate any effect within the Consolidated Financial Statements.
-
On July 28, 2023, Lan Cargo S.A purchased 1 share of Lan Cargo Overseas Limited from
Inversiones Lan S.A. Consequently, there were no significant changes in the shareholding
composition and therefore did not generate any effect within the Consolidated Financial
Statements.
-
On August 1, 2023, Inversiones Lan S.A. purchased 1 share of Americonsult SA de CV from Lan
Cargo Overseas Limited. Consequently, there were no significant changes in the shareholding
composition and therefore did not generate any effect within the Consolidated Financial
Statements.
-
On August 4, 2023, the merger of Holdco Colombia II SpA into Lan Pax Group S.A takes place,
acquiring the latter all of its assets, liabilities, rights and obligations. As a result of the above,
Holdco Colombia II SpA is dissolved. On the same date Lan Pax Group S.A carries out a capital
increase of ThUS$347 in Holdco Colombia I SpA through the contribution of 47,010 shares of
Aerovías de Integración Regional S.A. These transactions were carried out between entities under
common control of LATAM Airlines Group S.A. Group. and, therefore, did not generate any
effect within the Consolidated Financial Statements.
-
On September 11, 2023, the company Mas Investment Limited was liquidated and its controller
Lan Cargo Overseas Limited acquired all its assets, liabilities, rights and obligations, as a result
of the liquidation, including the investments that Mas Investment Limited held in the following
companies: (i) Consultoría Administrativa Profesional S.A. de C.V., equivalent to 49,500 shares;
(ii) Americonsult, S.A. de C.V., equivalent to 499 shares; (iii) Transporte Aéreo S.A. equivalent
to 109,662 shares; and (iv) Inversiones Aereas S.A., equivalent to 15,216 shares. These
transactions were carried out between entities under common control of LATAM Airlines Group
S.A. and, therefore, did not generate any effect within the Consolidated Financial Statements.
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-
On September 11, 2023, the company Lan Cargo Overseas Limited was liquidated and its
controller Lan Cargo S.A acquired all its all its assets, liabilities, rights and obligations, as a
result of the liquidation, including the investments that Lan Cargo Overseas Limited held in the
following companies: (i) Prime Airport Services Inc., equivalent to 105 shares; (ii) Americonsult
de Costa Rica S.A, equivalent to 66 shares; (iii) Americonsult de Guatemala, Sociedad Anónima,
equivalent to 50 shares; (iv) Consultoría Administrativa Profesional S.A. de C.V., equivalent to
49,500 shares; (v) Americonsult, S.A. de C.V., equivalent to 499 shares; (vi) Transporte Aéreo
S.A. equivalent to 109,662 shares; and (vii) Inversiones Aereas S.A., equivalent to 15,216 shares.
These transactions were carried out between entities under common control of LATAM Airlines
Group S.A. and, therefore, did not generate any effect within the Consolidated Financial
Statements.
-
On September 15, 2023, a capital increase was made in TAM S.A. through the contribution of
ThUS$106,104 on accounts receivable from LATAM Airlines Group S.A.; consequently, there
were no significant changes in the shareholder composition and therefore did not generate any
effect within the Consolidated Financial Statements.
-
On September 15, 2023, a capital increase was made in TAM Linhas Aéreas S.A through the
contribution of ThUS$106,104 on accounts receivable from TAM S.A., consequently, there were
no significant changes in the shareholder composition and therefore did not generate any effect
within the Consolidated Financial Statements.
-
On October 23 and 30, 2023, Inversiones Lan S.A. purchased a total 183 shares from Non-
controlling interest, for an a total amount of ThUS$2, of the subsidiary Aerovías de Integración
Regional S.A., consequently, these transactions generated a decrease in non-controlling interest,
with no generating significant effects on the Consolidated Financial Statements.
-
On December 6, 2023, the company Prime Cargo SpA was incorporated, which is 100% owned
by Lan Cargo S.A., whose exclusive purpose is to carry out storage activities for all types of
products and/or merchandise in Chile.
-
On December 29, 2023, LATAM Airlines Group S.A. purchased of 2,392,166 preferred shares of
Inversora Cordillera S.A. a Transportes Aéreos del Mercosur S.A.;consequently, the shareholding
composition of Inversora Cordillera S.A. is as follows: Lan Pax Group S.A. with 99.95% and
LATAM Airlines Group S.A. with 0.05%. These transactions were between subsidiaries of
LATAM Airlines Group not generating any effects within the Consolidated Financial Statements.
-
On December 29, 2023, LATAM Airlines Group S.A. purchased of 53,376 preferred shares of
LAN Argentina S.A. a Transportes Aéreos del Mercosur S.A.;consequently, the shareholding
composition of LAN Argentina S.A. is as follows: Lan Pax Group S.A. with 4.99%, Inversora
Cordillera S.A. with 94.96% and LATAM Airlines Group S.A. with 0.05%. These transactions
were between subsidiaries of LATAM Airlines Group not generating any effects within the
Consolidated Financial Statements.
-
On March 18, 2024, a capital reduction was carried out in Inversiones Aéreas S.A. through the
absorption of accumulated losses in the sum of ThUS$175,140. As a consequence of this
decrease in capital, the number of shares was reduced by 6,634,496, without modifying the
original participation of its shareholders. This transaction did not generate any effect within the
Consolidated Financial Statements.
-
On May 14, 2024, a capital increase was carried out in Aerovías de Integración Regional S.A. by
Holdco Colombia I SpA, for an amount of ThUS$45,271, equivalent to 10 shares and with a
premiums for the issuance of shares in favor of the Holco Colombia I SpA. As a result of this
increase, there were no significant changes in the shareholder composition.
-
On September 17, 2024, LATAM Airlines Group S.A acquired in 1 Euro, 100% of the rights of
the company Faisán Finance Designates Activity Company, domiciled in Ireland, for the
purposes of acquiring, managing, financing, refinancing, among others.
-
On November 8, 2024, the Board of Directors of the subsidiary Connecta Corporation agreed the
distribution and payment of dividends of ThUS$19,000 to Lan Cargo S.A., as sole shareholder.
This transaction did not generate any effect within the Consolidated Financial Statements.
-
At the Extraordinary General Shareholders' Meeting held on December 16, 2024 of the
subsidiary Lan Argentina S.A., it was agreed to forgive the debt associated with the preferred
dividends accrued and owed by this subsidiary to its shareholders, and to amend the company
statute to eliminate the Class "B" Preferred Shares, replacing them in their entirety with ordinary
shares. Accrued preferred dividends that were outstanding to shareholders amounted to
ThUS$1,019 as of December 15, 2024. At this same Meeting, it was approved to amend the
company statute to replace all preferred shares with ordinary shares, with the accrual of preferred
dividends being null and void as of this date. This transaction did not generate any effect within
the Consolidated Financial Statements.
-
At the Extraordinary General Shareholders' Meeting held on December 16, 2024, of the
subsidiary Inversora Cordillera S.A., it was agreed to forgive the debt associated with the
preferred dividends accrued and owed by said subsidiary to its shareholders, and to amend the
company statute to eliminate the Class "A" Preferred Shares, replacing them in their entirety with
ordinary shares. The accumulated preferred dividends that were pending payment to shareholders
amounted to ThUS$8,580. At this same Meeting, it was approved to amend the company statute
to eliminate and replace preferred shares with ordinary shares, with the accrual of preferred
dividends being null and void as of this date. This transaction did not generate any effect within
the Consolidated Financial Statements.
-
On December 17, 2024, a capital increase was carried out in Aerovías de Integración Regional
S.A. by Holdco Colombia I SpA, for an amount of ThUS$18,544, equivalent to 10 shares and
with a premiums for the issuance of shares in favor of the Holco Colombia I SpA. As a result of
this increase, there were no significant changes in the shareholder composition.
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NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following describes the principal accounting policies adopted in the preparation of these consolidated
financial statements.
2.1.
Basis of Preparation
These consolidated financial statements of LATAM Airlines Group S.A. and Subsidiaries as of December 31,
2024 and 2023, have been prepared in accordance with the International Financial Reporting Standards as
issued by the International Accounting Standards Board (IFRS Accounting Standards) and with the
interpretations issued by the International Financial Reporting Standards Interpretations Committee (IFRIC
IC).
The consolidated financial statements have been prepared under the historic-cost criterion, although modified
by the valuation at fair value of certain financial instruments.
The preparation of the consolidated financial statements in accordance with IFRS Accounting Standards
requires the use of certain critical accounting estimates. It also requires management to use its judgment in
applying the Company’s accounting policies. Note 4 describe the areas that imply a greater degree of
judgment or complexity or the areas where the assumptions and estimates are significant to the consolidated
financial statements.
These consolidated financial statements have been prepared in accordance with the accounting policies used by
the Company in the preparation of the 2023 consolidated financial statements, except for the standards
and interpretations adopted as of January 1, 2024.
(a)
Application of new standards for the year 2024:
Accounting pronouncements with implementation effective from January 1, 2024:
Issuance Date
Effective Date:
(i) Standards and amendments
Amendment to IAS 1: Presentation of financial statements, on
classification of liabilities.
January 2020
01/01/2024
Amendment to IAS 1: Presentation of financial statements, on
noncurrent liabilities with covenants.
October 2022
01/01/2024
Amendment to IFRS 16: Leases, on sales with leaseback.
September
2022
01/01/2024
Amendments to IAS 7 "Statement of cash flows" and IFRS 7 "Financial
Instruments: Information to be Disclosed"
May 2023
01/01/2024
The application of these accounting standards as of January 1, 2024, had no significant effect on the
Company's consolidated financial statements.
(b)
Accounting pronouncements not in force for the financial year beginning on January 1, 2024:
Issuance Date
Effective Date:
(i) Standards and amendments
Amendments to IAS 21: Lack of Exchangeability
August 2023
01/01/2025
IFRS 18: Presentation and disclosures in the financial statements
April 2024
01/01/2027
Amendment to IFRS 9 and IFRS 7: Classification and Measurement
of Financial Instruments
May 2024
01/01/2026
IFRS 19 Subsidiaries without Public Accountability: Disclosures
May 2024
01/01/2027
The Company's management is evaluating the impacts that the application of IFRS 18 Presentation and
disclosures in the financial statements; and the amendments to IFRS 9 and IFRS 7 may have on the
consolidated financial statements. Where it is estimated that the adoption of the amendments to IAS 21 and
IFRS 19 Subsidiaries without Public Liability: Disclosures, will not have significant effects on the company's
consolidated financial statements in the year of its first adoption.
(c)
Chapter 11 Filing and Exit
Chapter 11 Filing and Procedure: Due to the effects on the operation of the restrictions established in the
countries to control the effects of the COVID-19 pandemic, on May 25, 2020 the Board of LATAM Airlines
Group S.A. (“LATAM Parent”) resolved unanimously that LATAM Parent and some its subsidiaries should
initiate a reorganization process in the United States of America according to the rules established in the
Bankruptcy Code by filing a voluntary petition for relief in accordance with the same, which petition was
submitted on May 26, 2020 and was jointly administered under Case Number 20- 11254. Subsequently,
Piquero Leasing Limited (July 7, 2020) and TAM S.A. and its subsidiaries in Brazil (July 9, 2020) joined the
process (the voluntary petitions, collectively, the “Bankruptcy Filing” and each LATAM entity that filed a
petition, a “Debtor” and jointly, the “Debtors”).
As part of their overall reorganization process, while the Chapter 11 proceedings were outstanding the Debtors
sought and received relief in certain non-U.S. jurisdictions (i.e., Cayman Islands, Chile and Colombia).
The Bankruptcy Filing for each of the Debtors was jointly administered under the caption “In re LATAM
Airlines Group S.A. et al.” Case Number 20-11254. On June 18, 2022, the Bankruptcy Court issued a
memorandum decision approving the Debtors’ joint plan of reorganization (the “Plan”) and rejecting all
remaining objections and entered an order confirming the Plan (the “Confirmation Order”). On November 3,
2022 (the “Effective Date”), the Plan was substantially consummated and each of the Debtors emerged from
the Chapter 11 proceedings as “Reorganized Debtors”. Thereafter, the Reorganized Debtors were permitted to
operate their businesses and manage their properties without supervision of the Bankruptcy Court and free of
the restrictions of the Bankruptcy Code.
Pursuant to the Plan, the Company received an infusion of approximately US$8.19 billion through a mix of
new equity, convertible notes and debt, which enabled the Company to exit Chapter 11 with appropriate
capitalization to effectuate its business plan. Upon emergence, the Company had total debt of approximately
US$6.8 billion, cash and cash equivalents of approximately US$1.1 billion and revolving undrawn facilities in
the amount of US$1.1 billion.
Pursuant to the Plan and Backstop Agreements, between October and November 2022, LATAM obtained
secured priority DIP and exit debt for a total amount of US$2.75 billion, structures as follows: (i) a new
revolving credit line facility of up to US$500 million (the “Revolving Credit Facility”), (ii) and new term loan
B for US$1.1 billion (the “Term Loan”); (iii) notes issued pursuant to Rule 144A and Regulation S of the
Securities and Exchange Commission (“SEC”) under the Securities Act of 1933 of the United States of
America (the “U.S. Securities Act”) for a total amount of US$450 million and with a scheduled maturity date
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in 2027 (the “2027 Notes” ); and (iv) bonds issued pursuant to Rule 144A and Regulation S of the SEC under
the US Securities Law for a total amount of US$700 million and whit a scheduled maturity date in 2029 (the
“2029 Notes”, and together with the Revolving Credit Facility, the Term Loan, and the 2027 Notes, the “Exit
Financing"). All the debt instruments comprising the Exit Financing are secured equally and ratably with the
same collateral comprised of certain assets of LATAM Parent and its subsidiaries that are obligors under such
instruments.
As is usual in this types of restructurings, the Chapter 11 proceedings docket remained open after the Effective
Date to complete the conciliation process for certain claims that were still pending, as of such date, as well as
to resolve certain administrative matters.
On June 29, 2023, the Bankruptcy Court issued a final decree of the Chapter 11 proceedings ordering the
closure of Case Number 20-11254 and its file (the “Final Decree”). The foregoing, as a result of the resolution
of substantially all remaining issues of the Chapter 11 proceedings and all appeals of the Confirmation Order.
Subsequent to the Effective Date, the Exit Financing has been subject to the following amendments:
1.
The Revolving Credit Facility has been amended on two occasions.
a)
First, as reported by material fact dated July 15, 2024, the Revolving Credit Facility was modified in
order to, among other things, (i) extend the scheduled maturity date from November 2026 to July 15,
2029; provided, however, that it will be payable in advance earlier on the date that is 180 days prior to
the maturity date of any of the outstanding financings that share collateral with the Revolving Credit
Facility, to the extent that as of that date, such other financings have not been refinanced or deferred;
(ii) increase the amount of the Revolving Credit Facility from US$500 million to US$750 million; (iii)
eliminate references to the Chapter 11 proceedings; (iv) include additional financiers to the Revolving
Credit Line; and (v) modify certain commercial conditions of the Revolving Credit Facility in relation
to interest rates and fees and
b)
In second place, the Revolving Credit Facility was modified on October 7, 2024,to, among other
things, amend certain covenants and incorporate certain provisions relates to certain collateral release
events described below.
2.
2030 Notes and Refinancing of the 2027 Notes and the Term Loan.
As reported through material fact dated October 1, 2024 and October 15, 2024, on October 15, 2024,
LATAM Parent issued and placed in international markets, secured notes for a principal amounts of
US$1.4 billion, at an annual interest rate of 7.875% and maturing in the year 2030 (the “2030 Bonds”),
under the Rule 144-A and SEC Regulation S, under the US Securities Act. The Notes are considered
Exit Financing and, thus, are secured with the same collateral of the other instruments comprising the
Exit Financing. Additional, the 2030 Notes' indenture also includes provisions related to certain
collateral release events described below.
The proceeds obtained from issuance of the 2030 Notes, together with the additional available cash of
LATAM Parent of US$200 million, were used to pay in full and terminate the Term Loan and 2027
Notes.
If any, the remainder of the funds obtained under the 2030 Bonds and the cash reserves currently
maintained by LATAM Parent must be used for working capital and other general corporate purposes.
As a result of the above, there was an impact on expenses in the consolidated income statement for an
approximate amount of US$134 million, of which US$45 million directly impacted cash during the
fourth quarter of 2024.
3.
Additional Collateral Release
The Revolving Credit Facility and the 2030 Notes indenture include substantially the same provisions
under which LATAM Parent may in the future, and after satisfying certain conditions, release the
liens over certain collateral, including the cargo-business assets, the gates and slots. Any such
collateral release is subject to numerous conditions, including that (a) after giving pro forma effect to
the release, the asset coverage ratio set forth in those instruments is not less than 1.6x and (b) the
release is permitted under all Exit Financings (and any junior debt secured by the same collateral) and,
after giving effect to such release, the released collateral does no longer secure any such secured debts.
The referred collateral release provisions have not been included yet in the 2029 Notes indenture and,
thus, any such release cannot be implemented until either the 2029 Notes indenture is amended to
include such provisions or the 2029 Notes are paid in full.
2.2.
Basis of Consolidation
(a)
Subsidiaries
Subsidiaries are all the entities (including special-purpose entities) over which the Company has the power to
control the financial and operating policies, which are generally accompanied by a holding of more than half of
the voting rights. In evaluating whether the Company controls another entity, the existence and effect of
potential voting rights that are currently exercisable or convertible at the date of the consolidated financial
statements are considered. The subsidiaries are consolidated from the date on which control is passed to the
Company and they are excluded from the consolidation on the date they cease to be so controlled. The results
and cash are incorporated from the date of acquisition.
Balances, transactions and unrealized gains on transactions between the Company’s entities are eliminated.
Unrealized losses are also eliminated unless the transaction provides evidence of an impairment loss of the
asset transferred. When necessary, in order to ensure uniformity with the policies adopted by the Company, the
accounting policies of the subsidiaries are modified.
To account for and identify the financial information to be disclosed when carrying out a business
combination, such as the acquisition of an entity by the Company, the acquisition method provided for in IFRS
3: Business combinations is used.
(b)
Transactions with non-controlling interests
The Group applies the policy of considering transactions with non-controlling interests, when not related to the
loss of control, as equity transactions without an effect on income.
(c)
Sales of subsidiaries
When a subsidiary is sold and a percentage of participation is not retained, the Company derecognizes the
assets and liabilities of the subsidiary, the non-controlling interest and other components of equity related to
the subsidiary. Any gain or loss resulting from the loss of control is recognized in the consolidated income
statement by function within Other gains (losses).
If LATAM Airlines Group S.A. and Subsidiaries retain an ownership of participation in the disposed
subsidiary which does not represent control, this is recognized at fair value on the date that control is lost and
the amounts previously recognized in Other comprehensive income are accounted as if the Company had
disposed directly the assets and related liabilities, which can cause these amounts to be reclassified to profit or
loss. The percentage retained valued at fair value is subsequently accounted using the equity method.
(d)
Investees or associates
Investees or associates are all entities over which LATAM Airlines Group S.A. and Subsidiaries have
significant influence but have no control. This usually arises from holding between 20% and 50% of the
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13 / FINANCIAL STATEMENTS
g rights. Investments in associates are booked using the equity method and are initially recognized at their
Foreign currency transactions
Presentation and functional currencies
tems included in the financial statements of each of the entities of LATAM Airlines Group S.A. and its
diaries are valued using the currency of the main economic environment in which the entity operates (the
ional currency). The functional currency of LATAM Airlines Group S.A. is the United States Dollar,
h is also the presentation currency of the consolidated financial statements of LATAM Airlines Group
and Subsidiaries.
Transactions and balances
gn currency transactions are translated to the functional currency using the exchange rates on the
action dates. Foreign currency gains and losses resulting from the liquidation of these transactions and
the translation at the closing exchange rates of the monetary assets and liabilities denominated in foreign
ncy are shown in the consolidated statement of income by function except when deferred in Other
rehensive income as qualifying cash flow hedges.
Adjustment due to hyperinflation
July 1, 2018, the Argentine economy was considered, for purposes of IFRS Accounting Standards,
rinflationary. The consolidated financial statements of the subsidiaries whose functional currency is the
ntine Peso have been restated.
non-monetary items of the statement of financial position as well as the income statement, comprehensive
me and cash flows of the group's entities, whose functional currency corresponds to a hyperinflationary
omy, are adjusted for inflation and re-expressed in accordance with the variation of the consumer price
("CPI"), at each presentation date of its financial statements. The re-expression of non-monetary items is
from the date of initial recognition in the statements of financial position and considering that the
cial statements are prepared under the historical cost criterion.
osses or gains arising from the re-expression of non-monetary ítems and income and costs are recognized
consolidated income statement under "Result of indexation units".
gains and losses on the re-expression of opening balances due to the initial application of IAS 29 were
nized in the consolidated retained earnings.
xpression due to hyperinflation will be recorded until the period or exercise in which the economy of the
y ceases to be considered as a hyperinflationary economy. At that time, the adjustments made by
rinflation will be part of the cost of non-monetary assets and liabilities.
comparative amounts in the consolidated financial statements of the Company are presented in a stable
ncy and are not adjusted for subsequent changes in the price level or exchange rates.
Group entities
esults and the financial situation of the Group's entities, whose functional currency is different from the
ntation currency of the consolidated financial statements, of LATAM Airlines Group S.A., which does
orrespond to the currency of a hyperinflationary economy, are converted into the currency of presentation
lows:
Assets and liabilities of each consolidated statement of financial position presented are translated at
osing exchange rate on the consolidated statement of financial position date;
The revenues and expenses of each income statement account are translated at the exchange rates
iling on the transaction dates, and
All the resultant exchange differences by conversion are shown as a separate component in other
rehensive income, within "Gain (losses) from exchange rate difference, before tax".
For those subsidiaries of the group whose functional currency is different from the presentation currency and
corresponds to the currency of a hyperinflationary economy; its restated results, cash flow and financial
situation are converted to the presentation currency at the closing exchange rate on the date of the consolidated
financial statements.
The exchange rates used correspond to those fixed in the country where the subsidiary is located, whose
functional currency is different to the U.S. dollar.
2.4.
Property, plant and equipment
The land of LATAM Airlines Group S.A. and its Subsidiaries, are recognized at cost less any accumulated
impairment loss. The rest of the Property, plant and equipment are recorded, both at their initial recognition
and their subsequent measurement, at their historical cost, restated for inflation when appropriate, less the
corresponding depreciation and any loss due to impairment.
The amounts of advances paid to the aircraft manufacturers are capitalized by the Company under
Construction in progress until they are received.
Subsequent costs (replacement of components, improvements, extensions, etc.) are included in the value of the
initial asset or are recognized as a separate asset, only when it is probable that the future economic benefits
associated with the elements of property, plant and equipment, will flow to the Company and the cost of the
item can be determined reliably. The value of the replaced component is written off. The rest of the repairs and
maintenance are charged to income when they are incurred.
The depreciation of the Property, plant and equipment is calculated using the linear method over their
estimated technical useful lives; except in the case of certain technical components which are depreciated on
the basis of cycles and hours flown. This charge is recognized in the captions "Cost of sale" and
"Administrative expenses".
The residual value and the useful life of assets are reviewed and adjusted, if necessary, once a year. Useful
lives are detailed in Note 16 (d).
When the value of an asset exceeds its estimated recoverable amount, its value is immediately reduced to its
recoverable amount.
Losses and gains from the sale of property, plant and equipment are calculated by comparing the consideration
with the book value and are included in the consolidated statement of income.
2.5.
Intangible assets other than goodwill
(a)
Airport slots and Loyalty program
Airport slots and the Loyalty program correspond to intangible assets with indefinite useful lives and are
annually tested for impairment as an integral part of the CGU Air Transport.
Airport Slots correspond to an administrative authorization to carry out operations of arrival and departure of
aircraft, at a specific airport, within a certain period of time.
The Loyalty program corresponds to the system of accumulation and exchange of points that is part of TAM
Linhas Aereas S.A.
(b)
Computer software
Licenses for computer software acquired are capitalized on the basis of the costs incurred in acquiring them
and preparing them for using the specific software. These costs are amortized over their estimated useful lives,
for which the Company has defined useful lives between 3 and 10 years.
Expenses related to the development or maintenance of computer software which do not qualify for
capitalization, are shown as an expense when incurred. The personnel costs and other costs directly related to
the production of unique and identifiable computer software controlled by the Company, are shown as
intangible Assets other than Goodwill when they have met all the criteria for capitalization.
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2.6.
Borrowing costs
Interest costs incurred for the construction of any qualified asset are capitalized over the time necessary for
completing and preparing the asset for its intended use. Other interest costs are recognized in the consolidated
statement of income by function when accrued.
2.7.
Losses for impairment of non-financial assets
Intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for
impairment, or more frequently if events or changes in circumstances indicate that they might be impaired.
Assets subject to amortization are tested for impairment losses whenever any event or change in circumstances
indicates that the carrying amount may not be recoverable. An impairment loss is recognized for the excess of
the carrying amount of the asset over its recoverable amount. The recoverable amount is the fair value of an
asset less the costs of sale or the value in use, whichever is greater. For the purpose of evaluating impairment
losses, assets are grouped at the lowest level for which there are largely independent cash inflows (cash
generating unit. Non-financial assets, other than goodwill, that would have suffered an impairment loss are
reviewed if there are indicators of reversal of losses. Impairment losses are recognized in the consolidated
statement of income by function under "Other gains (losses)".
2.8.
Financial assets
The Company classifies its financial assets in the following categories: at fair value (either through other
comprehensive income, or through gains or losses), and at amortized cost. The classification depends on the
business model of the entity to manage the financial assets and the contractual terms of the cash flows.
The group reclassifies debt investments when, and only when, it changes its business model to manage those
assets.
In the initial recognition, the Company measures a financial asset at its fair value plus, in the case of a financial
asset classified at amortized cost, the transaction costs that are directly attributable to the acquisition of the
financial asset. Transaction costs of financial assets accounted for at fair value through profit or loss are
recorded as expenses in the consolidated statement of income by function.
(a)
Debt instruments
The subsequent measurement of debt instruments depends on the group's business model to manage the asset
and cash flow characteristics of the asset. The Company has two measurement categories in which the group
classifies its debt instruments:
Amortized cost: the assets held for the collection of contractual cash flows where those cash flows represent
only payments of principal and interest are measured at amortized cost. A gain or loss on a debt investment
that is subsequently measured at amortized cost and is not part of a hedging relationship is recognized in
income when the asset is derecognized or impaired. Interest income from these financial assets is included in
financial income using the effective interest rate method.
Fair value through profit or loss: assets that do not meet the criteria of amortized cost or fair value through
other comprehensive income are measured at fair value through profit or loss. A gain or loss on a debt
investment that is subsequently measured at fair value through profit or loss and is not part of a hedging
relationship is recognized in profit or loss and is presented net in the consolidated statement of income by
function within other gains / (losses) in the period or exercise in which it arises.
(b)
Equity instruments
Changes in the fair value of financial assets at fair value through profit or loss are recognized in other gains /
(losses) in the consolidated statement of income by function as appropriate.
The Company evaluates in advance the expected credit losses associated with its debt instruments recorded at
amortized cost. The applied impairment methodology depends on whether there has been a significant increase
in credit.
2.9. Derivative financial instruments and embedded derivatives
Derivative financial instruments and hedging activities
Initially at fair value on the date on which the derivative contract was made and are subsequently valued at
their fair value. The method to recognize the resulting loss or gain depends on whether the derivative
designated as a hedging instrument and, if so, the nature of the item being hedged.
The Company designates certain derivatives as:
(a) Hedge of an identified risk associated with a recognized liability or an expected highly- probable
transaction (cash-flow hedge), or
(b) Derivatives that do not qualify for hedge accounting.
At the beginning of the transaction, the Company documents the economic relationship between the hedged
items existing between the hedging instruments and the hedged items, as well as its objectives for risk
management and the strategy to carry out various hedging operations. The Company also documents its
assessment, both at the beginning and on an ongoing basis, as to whether the derivatives used in the hedging
transactions are highly effective in offsetting the changes in the fair value or cash flows of the items being
hedged.
The total fair value of the hedging derivatives is booked as Other non-current financial asset or liability if the
remaining maturity of the item hedged is over 12 months, and as an Other current financial asset or liability if
the remaining term of the item hedged is less than 12 months. Derivatives not booked as hedges are classified
as Other financial assets or liabilities.
(a) Cash flow hedges
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow
hedges is shown in the statement of other comprehensive income. The loss or gain relating to the ineffective
portion is recognized immediately in the consolidated statement of income by function under other gains
(losses). Amounts accumulated in equity are reclassified to profit or loss in the periods or exercise when the
hedged item affects profit or loss. When these amounts correspond to hedging derivatives of highly probable
items that give rise to non-financial assets or liabilities, in which case, they are recorded as part of the non-
financial assets or liabilities.
For fuel price hedges, the amounts shown in the statement of other comprehensive income are reclassified to
results under the line-item Cost of sales to the extent that the fuel subject to the hedge is used.
Gains or losses related to the effective part of the change in the intrinsic value of the options are recognized in
the cash flow hedge reserve within equity. Changes in the time value of the options related to this part are
recognized within Other Consolidated Comprehensive Income in the costs of the hedge reserve within equity.
When a hedging instrument matures, is sold, or fails to meet the requirements to be accounted for as a hedge,
any gain or loss accumulated in the statement of Other comprehensive income until that moment, remains in
the statement of other comprehensive income and is reclassified to the consolidated statement of income when
the hedged transaction is finally recognized.
When it is expected that the hedged transaction is no longer going to occur, the gain or loss accumulated in the
statement of other comprehensive income is taken immediately to the consolidated statement of income by
function as “Other gains (losses)”.
(b) Derivatives not booked as a hedge
The changes in fair value of any derivative instrument that is not booked as a hedge are shown immediately in
the consolidated statement of income in “Other gains (losses)”.
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Embedded derivatives
The Company assesses the existence of embedded derivatives in financial instrument contracts. Derivatives
embedded in non-derivative host contracts are treated as separate derivatives when they meet the definition of
a derivative, their risks and characteristics are not closely related to those of the host contracts and the
contracts are not measured at FVTPL as a whole. LATAM Airlines Group S.A. has determined that no
embedded derivatives currently exist.
2.10.
Inventories
Inventories, are shown at the lower of cost and their net realizable value. The cost is determined on the basis of
the weighted average cost method (WAC). The net realizable value is the estimated selling price in the normal
course of business, less estimated costs necessary to make the sale.
2.11.
Trade and other accounts receivable
Commercial accounts receivable are initially recognized at their fair value and subsequently at their amortized
cost in accordance with the effective rate method, less the provision for impairment according to the model of
the expected credit losses. The Company applies the simplified approach permitted by IFRS 9, which requires
that expected lifetime losses be recognized upon initial recognition of accounts receivable.
In the event that the Company transfers its rights to any financial asset (generally accounts receivable) to a
third party in exchange for a cash payment, the Company evaluates whether all risks and rewards have been
transferred, in which case the account receivable is derecognized.
The existence of significant financial difficulties on the part of the debtor, the probability that the debtor goes
bankrupt or financial reorganization are considered indicators of a significant increase in credit risk.
The carrying amount of the asset is reduced as the provision account is used and the loss is recognized in the
consolidated income statement under "Cost of sales". When an account receivable is written off, it is
regularized against the provision account for the account receivable.
2.12.
Cash and cash equivalents
Cash and cash equivalents include cash and bank balances, time deposits in financial institutions, and other
short-term and highly liquid investments and a low risk of loss of value.
2.13.
Capital
The common shares are classified as net equity.
Incremental costs directly attributable to the issuance of new shares or options are shown in net equity as a
deduction from the proceeds received from the placement of shares.
2.14.
Trade and other accounts payables
Trade payables and other accounts payable are initially recognized at fair value and subsequently at amortized
cost.
2.15.
Interest-bearing loans
Financial liabilities are shown initially at their fair value, net of the costs incurred in the transaction. Later,
these financial liabilities are valued at their amortized cost; any difference between the proceeds obtained (net
of the necessary arrangement costs) and the repayment value, is shown in the consolidated statement of
income during the term of the debt, according to the effective interest rate method.
Financial liabilities are classified in current and non-current liabilities according to the contractual payment
dates of the nominal principal and compliance with contractual agreements at the closing date of these
financial statements.
Convertible Notes
The component parts of the convertible notes issued by LATAM Airlines Group S.A. are classified separately
as financial liabilities and equity in accordance with the substance of the contractual arrangements and the
definitions of a financial liability and an equity instrument.
At the date of issue, the fair value of the liability component is estimated using the prevailing market interest
rate for similar non-convertible instruments. This amount is recorded as a liability on an amortized cost basis
using the effective interest method until extinguished upon conversion or at the instrument’s maturity date.
The conversion option classified as equity is determined by the deducting the amount of the liability
component from the fair value of the compound instrument as a whole. This is recognized and included in
other equity, net of income tax effects. and is not subsequently remeasured. In addition, the conversion option
classified as equity will remain in other equity until the conversion option is exercised, in which case, the
balance recognized in other equity will be transferred to share capital. Where the conversion option remains
unexercised at maturity date of the convertible bond, the balance recognized in other equity will be transferred
to retained earnings. No gain or loss is recognized in profit or loss upon conversion or expiration of the
conversion option.
Transaction costs that relate to the issue of the convertible notes are allocated to the liability and equity
components in proportion to the allocation of the gross proceeds. Transaction costs relating to the equity
component are charged directly to equity.
2.16.
Current and deferred taxes
The tax expense for the period or exercise comprises income and deferred taxes.
The current income tax expense is calculated based on tax laws enacted at the date of the statement of financial
position, in the countries in which the subsidiaries and associates operate and generate taxable income.
Deferred taxes are recognized on the temporary differences arising between the tax bases of assets and
liabilities and their carrying amounts in the consolidated financial statements. When deferred taxes arise from
the initial recognition of a liability or an asset in a transaction other than a business combination, which at the
time of the transaction does not affect either the accounting result or the tax profit or loss, they are recorded.
Deferred tax is determined using the tax rates (and laws) that have been enacted or substantially enacted at the
date of the consolidated statements of financial position and are expected to apply when the related deferred
tax asset is realized or the deferred tax liability discharged.
Deferred tax assets are recognized only to the extent it is probable that the future taxable profit will be
available against which the temporary differences can be utilized.
The tax (current and deferred) is recognized in the statement of income by function, unless it relates to an item
recognized in other comprehensive income, directly in equity or arises from a business combination. In this
case the tax is also recognized in other comprehensive income or, directly in the statement of income by
function, respectively.
Deferred tax assets and liabilities are offset if, and only if:
(a) there is a legally enforceable right to set off current tax assets and liabilities, and
(b) the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either:
(i) the same taxable entity, or (ii) different taxable entities which intend to settle current tax liabilities and
assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in
which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.
LATAM Airlines Group S.A has evaluated the potential impact derived from the implementation of the so-
called “GloBE or Pillar Two rules”, through which multinational groups are expected to pay a minimum
effective tax rate of 15%. Based on the analysis carried out, we have concluded that, either because they fall
outside the scope of the GloBE Rules (as they do not meet the criteria to be considered a “Constituent Entity”
for the purposes of the Pillar) or they are located in jurisdictions that do not have implemented such GloBE
Rules, no entity, permanent establishment or vehicle of the LATAM Group will have a financial impact due to
the GloBE Rules in fiscal year 2024. The LATAM Group constantly evaluates these potential impacts,
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including the recent Law 15.079/2024 published in Brazil during the month of December, which makes
definitive Provisional Measure No. 1.262/2024 published on October 3, 2024 by the Federal Government. This
law introduces the Pillar Two rules in the country without relevant changes with respect to the initial
provisional measure, incorporating certain aspects of the GloBE rules into Brazilian tax legislation. The new
rules in Brazil will come into effect in fiscal year 2025. At the closing of these financial statements, the group
does not present expenses (income) for current taxes related to the income tax of Pillar Two.
LATAM Airlines Group S.A. and its Subsidiaries have adopted the exception of paragraph 4A of IAS 12,
incorporated in the amendment published on May 23, 2023, relating to the recognition and disclosure of
deferred tax assets and liabilities related to Pillar Two income taxes.
2.17.
Employee benefits
(a)
Personnel vacations
The Company recognizes the expense for personnel vacations on an accrual basis.
(b)
Share-based compensation
The compensation plans implemented based on the value of the shares of the Company are recognized in the
consolidated financial statements in accordance with IFRS 2: Share-based payments, for cash settled awards
the fair value, updated as of the closing date of each reporting period or exercise, is recorded as a liability with
charge to remuneration.
(c) Post-employment and other long-term benefits
Provisions are made for these obligations by applying the method of the projected unit credit method, and
considering estimates of future permanence, mortality rates and future wage increases determined on the basis
of actuarial calculations. The discount rates are determined by reference to market interest-rate curves.
Actuarial gains or losses are shown in other comprehensive income.
(d)
Incentives
The Company has an annual incentives plan for its personnel for compliance with objectives and individual
contribution to the results. The incentives eventually granted consist of a given number or portion of monthly
remuneration and the provision is made on the basis of the amount estimated for distribution.
(e)
Termination benefits
The group recognizes termination benefits at the earlier of the following dates: (a) when the group terminates
the employee relationship; and (b) when the entity recognizes costs for a restructuring that is within the scope
of IAS 37 and involves the payment of terminations benefits.
2.18.
Provisions
Provisions are recognized when:
(i) The Company has a present legal or constructive obligation as a result of a past event;
(ii) It is probable that payment is going to be required to settle an obligation; and
(iii) A reliable estimate of the obligation amount can be made.
2.19.
Revenue from contracts with customers
(a)
Transportation of passengers and cargo
The Company recognizes the sale for the transportation service as a deferred income liability, which is
recognized as income when the transportation service has been provided or expired. In the case of air transport
services sold by the Company and that will be made by other airlines, the liability is reduced when they are
remitted to said airlines. The Company periodically reviews whether it is necessary to make an adjustment to
deferred income liabilities, mainly related to returns, changes, among others.
Compensations granted to clients for changes in the levels of services or billing of additional services such as
additional baggage, change of seat, among others, are considered modifications of the initial contract, therefore,
they are deferred until the corresponding service is provided.
(b)
Expiration of air tickets
The Company estimates on a monthly basis the probability of expiration of air tickets, with refund clauses,
based on their history of use. Air tickets without a refund clause expire on the date of the flight in case the
passenger does not show up.
(c)
Costs associated with the contract
The costs related to the sale of air tickets are capitalized and deferred until the moment of providing the
corresponding service. These assets are included under the heading "Other current non-financial assets" in the
Consolidated Classified Statement of Financial Position.
(d)
Frequent passenger program
The Company maintains the following loyalty programs: LATAMPASS’s and LATAMPASS’s Brazil, whose
objective is building customer loyalty through the delivery of miles or points.
These programs give their frequent passengers the possibility of earning LATAMPASS’s miles or points, which
grant the right to a selection of both air and non-air awards. Additionally, the Company sells the LATAMPASS
miles or points to financial and non-financial partners through commercial alliances to award miles or points to
their customers.
To reflect the miles and points earned, the loyalty program mainly includes two types of transactions that are
considered revenue arrangements with multiple performance obligations: (1) Passenger Ticket Sales Earning
miles or points (2) miles or points sold to financial and non-financial partner (*).
(*) The current contract with the financial partner in Chile will end on December 31, 2025, and the Company is
evaluating alternatives that, in the best interest of the company, contribute to further improve the LATAMPASS
Program and its partners.
(1)
Passenger Ticket Sales Earning Miles or Points.
In this case, the miles or points are awarded to customers at the time that the company performs the flight.
To value the miles or points earned with travel, we consider the quantitative value a passenger receives by
redeeming miles for a ticket rather than paying cash, which is referred to as Equivalent Ticket Value ("ETV").
Our estimate of ETV is adjusted for miles and points that are not likely to be redeemed ("breakage").
The balance of miles and points that are pending to redeem are included within deferred revenue.
(2)
Miles sold to financial and non-financial partners
To value the miles or points earned through financial and non-financial partners, the performance obligations
with the client are estimated separately. To calculate these performance obligations, different components that
add value in the commercial contract must be considered, such as marketing, advertising and other benefits, and
finally the value of the points awarded to customers based on our ETV. The value of each of these components
is finally allocated in proportion to their relative prices. The performance obligations associated with the
valuation of the points or miles earned become part of the Deferred Revenue, and the remaining performance
obligations are recorded as revenue when the miles or points are delivered to the client.
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13 / FINANCIAL STATEMENTS
When the miles and points are exchanged for products and services other than the services provided by the
Company, the income is recognized immediately; when the exchange is made for air tickets of any airline of
LATAM Airlines Group S.A. and Subsidiaries, the income is deferred until the air transport service is provided.
The miles and points that the Company estimates will not be exchanged are recognized in the results based on
the consumption pattern of the miles or points effectively exchanged by customers. The Company uses
statistical models to estimate the probability of exchange, which is based on historical patterns and projections.
2.20.
Leases
The Company recognizes contracts that meet the definition of a lease as a right of use asset and a lease liability
on the date when the underlying asset is available for use.
Right of use assets are measured at cost including the following:
-
The amount of the initial measurement of the lease liability;
-
Lease payment made at or before commencement date;
-
Initial direct costs, and
-
Restoration costs.
The right of use assets are recognized in the statement of financial position in Property, plant and equipment.
Lease liabilities include the net present value of the following payments:
-
Fixed payments including in substance fixed payment.
-
Variable lease payments that depend on an index or a rate;
-
The exercise price of a purchase option, if it is reasonably certain that the option will be exercised.
The discount rate that LATAM Airlines Group S.A. uses is the interest rate implicit in the lease, if that rate can
be readily determined. This is the rate of interest that causes the present value of (a) lease payments and (b) the
unguaranteed residual value to equal the sum of (i) the fair value of the underlying asset and (ii) any initial
direct costs of the lessor.
LATAM Airlines Group S.A. uses its incremental borrowing rate if the interest rate implicit in the lease cannot
be readily determined.
Lease liabilities are recognized in the statement of financial position under “Other financial liabilities, current or
non-current”.
Interest accrued on financial liabilities is recognized in the consolidated statement of income in "Financial
costs".
Principal and interest are present in the consolidated cash flow as "Payments of lease liability" and "Interest
paid", respectively, within financing cash flows.
Payments associated with short-term leases without purchase options and leases of low-value assets are
recognized on a straight-line basis in profit or loss at the time of accrual. Those payments are presented within
operating cash flows.
The Company analyzes the financing agreements of aircraft, mainly considering characteristics such as:
(a)
That the Company initially acquired the aircraft or took an important part in the process of direct
acquisition with the manufacturers.
(b)
Due to the contractual conditions, it is virtually certain that the Company will execute the purchase
option of the aircraft at the end of the lease term.
Since these financing agreements are “substantially purchases” and not leases, the related liability is considered
as a financial debt classified under IFRS 9 and continues to be presented within the “Other financial liabilities”
described in Note 18. On the other hand, the aircraft are presented in Property, Plant and Equipment, as
described in Note 16, as “own aircraft”.
The Group qualifies as sale and lease transactions, operations that lead to a sale according to IFRS 15. More
specifically, a sale is considered as such if there is no option to purchase the goods at the end of the lease term.
If the sale by the seller-lessee is classified as a sale in accordance with IFRS 15, the underlying asset is
derecognized, and a right-of-use asset equal to the portion retained proportionally of the amount of the asset is
recognized.
If the sale by the seller-lessee is not classified as a sale in accordance with IFRS 15, the transferred assets are
kept in the financial statements and a financial liability equal to the sale price is recognized (received from the
buyer-lessor).
2.21.
Non-current assets or disposal groups classified as held for sale
Non-current assets (or disposal groups) classified as assets held for sale are shown at the lesser of their book
value and the fair value less costs to sell.
2.22.
Maintenance
The costs incurred for scheduled heavy maintenance of the aircraft’s fuselage and engines are capitalized and
depreciated until the next maintenance. The depreciation rate is determined on technical grounds, according to
the use of the aircraft expressed in terms of cycles and flight hours.
In case of aircraft include in property, plant and equipment, these maintenance cost are capitalized as Property,
plant and equipment, while in the case of aircraft on right of use, a liability is accrued based on the use of the
main components is recognized, since a contractual obligation with the lessor to return the aircraft on agreed
terms of maintenance levels exists. These are recognized as Cost of sales.
Additionally, some contracts that comply with the definition of lease establish the obligation of the lessee to
make deposits to the lessor as a guarantee of compliance with maintenance and return conditions. These
deposits, often called maintenance reserves, accumulate until a major maintenance is performed; and once done,
recovery is requested to the lessor. At the end of the contract period, there is comparison between the reserves
that have been paid and required return conditions, and compensation between the parties are made if
applicable.
The unscheduled maintenance of aircraft and engines, as well as minor maintenance, are charged to results as
incurred.
2.23.
Environmental costs
Disbursements related to environmental protection are charged to results when incurred or accrue.
NOTE 3 - FINANCIAL RISK MANAGEMENT
3.1.
Financial risk factors
The Company is exposed to different financial risks: (a) market risk, (b) credit risk, and (c) liquidity risk. The
risk management of the Company aims to minimize the adverse effects of financial risks affecting the company.
(a)
Market risk
Due to the nature of its operations, the Company has exposure to market factors such as: (i) fuel-price risk, (ii)
exchange -rate risk (FX), and (iii) interest -rate risk.
The Company has developed manuals and procedures to manage the market risk, which goal is to identify,
quantify, monitor and mitigate the adverse effects of changes in market factors mentioned above.
For the foregoing, Management monitors the evolution of fuel price levels, exchange rates and interest rates,
quantifies their exposures and their risk, and develops and executes hedging strategies.
(i)
Fuel-price risk
Exposure:
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For the execution of its operations, the Company purchases a fuel called Jet Fuel grade 54 USGC, which is
subject to the fluctuations of international fuel prices.
Mitigation:
To hedge the fuel-price risk exposure, the Company operates with derivative instruments (swaps and options)
whose underlying assets may be different from Jet Fuel, such as West Texas Intermediate (“WTI”) crude, Brent
(“BRENT”) crude and distillate Heating Oil (“HO”), which may have a high correlation with Jet Fuel and
greater liquidity.
Fuel Hedging Results:
During the period ended December 31, 2024, the Company recognized losses of US$(18.1) million for fuel
hedging net of premiums in the costs of sales for the year. During the period ended December 31, 2023, the
Company recognized gains of US$15.7 million for fuel hedging net of premiums in the costs of sales for the
year.
As of December 31, 2024, the market value of the fuel positions amounted to US$7.7 million (positive). At the
end of December 2023, this market value was US$22.1 million (positive).
The following tables show the level of hedge for different periods:
Positions as of December 31, 2024 (*)
Maturities
Q125
Q225
Q325
Q425
Total
Percentage of coverage over the expected volume of
consumption
51%
47%
34%
30%
41%
Positions as of December 31, 2023 (*)
Maturities
Q124
Q224
Q324
Q424
Total
Percentage of coverage over the expected volume of
consumption
35%
32%
30%
22%
30%
(*) The percentage shown in the table considers all the hedging instruments (swaps and options).
Sensitivity analysis
A drop in fuel price positively affects the Company through a reduction in costs. However, also negatively
affects contracted positions as these are acquired to protect the Company against the risk of a rise in price.
Therefore, the policy is to maintain a hedge-free percentage in order to be competitive in the event of a drop in
price.
The current hedge positions are booked as cash flow hedge contracts, so a variation in the fuel price has an
impact on the Company’s net equity.
The following table shows the sensitivity of financial instruments according to reasonable changes in the price
of fuel and their effect on equity.
The calculations were made considering a parallel movement of US$5 per barrel in the underlying reference
price curve at the end of December 2024 and the end of December 2023. The projection period was defined
until the end of the last fuel hedging contract in force, being the last business day of the second half of 2025.
Benchmark price
(US$ per barrel)
Positions as of December 31, 2024
effect on Equity
(MUS$)
Positions as of December 31, 2023
effect on Equity
(MUS$)
+5
+15.7
+10.8
-5
-12.8
-10.7
Given the fuel hedging structure as of the fourth quarter of 2024, which considers a portion free of hedges, a
vertical drop of 5 dollars in the JET reference price (considered as the monthly daily average), would have
meant an impact of approximately US$156.7 million lower fuel cost. For the same period, a vertical rise of 5
dollars in the JET reference price (considered as the monthly daily average), would have meant an approximate
impact of US$138.1 million in higher fuel costs.
(ii)
Foreign exchange rate risk:
Exposure:
The functional currency of the financial statements of the parent company is the US dollar, so that the risk of
the Transactional and Conversion exchange rate arises mainly from the Company's business, strategic and
accounting operating activities that are expressed in a monetary unit other than the functional currency.
The subsidiaries of LATAM are also exposed to foreign exchange risk whose impact affects the Company's
Consolidated Income.
The largest operational exposure to LATAM's exchange risk comes from the concentration of businesses in
Brazil, which are mostly denominated in Brazilian real (R$), and are actively managed by the Company.
At a lower concentration, the Company is also exposed to the fluctuation of other currencies, such as: Euro,
Pound sterling, Australian dollar, Colombian peso, Chilean peso, Argentine peso, Paraguayan guarani, Mexican
peso, Peruvian Sol and New Zealand dollar.
Mitigation:
The Company mitigates currency risk exposures by contracting hedging or non-hedging derivative instruments
or through natural hedges or execution of internal operations.
Exchange Rate Hedging Results (FX):
As of December 31, 2024, the Company recognized gains of US$10.0 million for FX hedging derivatives net
of premiums reflected in exchange rate. At the end of December of 2023, the Company recognized losses for
US$10.1 million for FX hedging derivatives in exchange rate.
As of December 31, 2024, the market value of hedging FX derivative positions is US$3.1 million (positive). As
of December 31, 2023, the market value of the hedging FX derivative positions was US$1.5 million (negative).
As of December 31, 2024, the Company has current hedging FX derivatives for US$165 million. . As of
December 31, 2023, the Company held hedging FX derivatives of US$404 million.
Sensitivity analysis:
A depreciation of the R$/US$ exchange rate, negatively affects the Company's operating cash flows, however,
also positively affects the value of the positions of derivatives contracted.
The following table shows the sensitivity of current hedging FX derivative instruments according to reasonable
changes in the exchange rate and its effect on equity.
Appreciation (depreciation)
of R$/US$
Effect on equity as of
December 31, 2024
(MUS$)
Effect on equity as of
December 31, 2023
(MUS$)
-10%
-3.6
-10.0
+10%
+1.0
+19.0
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13 / FINANCIAL STATEMENTS
Impact of Exchange rate variation in the Consolidated Income Statements (Foreign exchange gains/losses).
In the case of TAM S.A., whose functional currency is the Brazilian real, a large part of its assets and liabilities
is expressed in US dollars. Therefore, when converting financial assets and liabilities, from US dollar to
Brazilian reais, they have an impact on the result of TAM S.A., which is consolidated in the Company's Income
Statement.
In order to reduce the impact on the Company's result caused by appreciations or depreciations of R$/US$, the
Company carries out internal operations to reduce the net exposure in US$ for TAM S.A.
The following table shows the impact of the Exchange Rate variation on the Consolidated Income Statement
when the R$/US$ exchange rate appreciates or depreciates by 10%:
Appreciation (depreciation)
of R$/US$
Effect on Income Statement
for the year ended December 31, 2024
(MUS$)
Effect on Income Statement
for the year ended December 31, 2023
(MUS$)
-10%
-54.7
+6.6
+10%
+54.7
-6.6
Impact of the exchange rate variation in the Equity, from translating the subsidiaries financial statements into
US Dollars (Cumulative Translate Adjustment).
Since the functional currency of TAM S.A. and Subsidiaries is the Brazilian real, the Company presents the
effects of the exchange rate fluctuations in Other comprehensive income (Cumulative Translation Adjustment)
by converting the Statement of financial position and Income statement of TAM S.A. and Subsidiaries from
their functional currency to the U.S. dollar, which is the presentation currency of the consolidated financial
statement of LATAM Airlines Group S.A. and Subsidiaries.
The following table shows the impact on the Cumulative Translation Adjustment included in Other
comprehensive income recognized in Total equity in the case of an appreciation or depreciation of 10% in the
exchange rate R$/US$:
Appreciation (depreciation)
of R$/US$
Effect at December 31, 2024
MUS$
Effect at December 31, 2023
MUS$
-10%
+318.51
+327.01
+10%
-260.60
-267.56
(iii)
Interest -rate risk:
Exposure:
The Company has exposure to fluctuations in interest rates affecting the future cash flows of the assets, and
current and future financial liabilities.
The Company is mainly exposed to the Secured Overnight Financing Rate (“SOFR”) and other less relevant
interest rates such as Brazilian Interbank Certificates of Deposit (“CDI”) .
Of the company's financial debt subject to variable rates, all of the contracts maintain exposure to the SOFR
reference rate.
Mitigation:
Currently, 76% (50% as of December 31, 2023) of the debt is fixed against fluctuations in interest rates. The
variable debt is indexed to the reference rate based on SOFR.
Likewise, most of the company's liquidity is denominated in US dollars and indexed to a return rate similar and
with a similar fluctuation to the SOFR rate, which helps reduce exposure.
Rate Hedging Results:
During the period ended December 31, 2024, the Company did not recognize any losses for premiums paid. At
the end of December of 2023, losses of US$1.8 million were recognized corresponding to the recognition in
profit for premiums paid.
As of December 31, 2024, the value of the interest rate derivative positions corresponding to operating leases to
fix the income of future plane arrivals amounted to US$4.68 million (negative), at the end of December 2023
the Company did not have interest rate derivatives outstanding.
As of December 31, 2024, the Company recognized an increase in the right-of-use asset due to the expiration of
derivatives associated with some aircraft leases amounted to US$ 0.1 million (negative). As of December 31,
2023, the Company recognized a decrease in the right-of-use asset due to the expiration of derivatives for
US$14.9 million associated with the aircraft lease. On this same date, a lower depreciation expense of the right-
of-use asset for US$1.9 million (positive) was recognized. At the end of December of 2023, the Company
recognized US$1.1 (positive) million for this same concept.
As of December 31, 2024, the Company settled derivatives associated with hedges of leased aircraft for US$0.1
million (negative)
Sensitivity analysis:
The following table shows the sensitivity of changes in financial obligations that are not hedged against
interest-rate variations. These changes are considered reasonably possible, based on current market conditions
each date.
Increase (decrease)
of future curve
SOFR rate
Positions as of December 31, 2024 effect
on Income (Loss) before taxes
(MUS$)
Positions as of December 31, 2023 effect
on Income (Loss) before tax
(MUS$)
+100 basis points
-9.28
-20.27
-100 basis points
+9.28
+20.27
A large part of the derivatives of current rates are recorded as cash flow hedge contracts, therefore, a variation
in interest rates has an impact on the market value of the derivatives, whose changes affect the equity of the
entity.
Increase (decrease)
interest rate curve
Positions as of December 31, 2024
effect on equity
(MUS$)
Positions as of December 31, 2023
effect on equity
(MUS$)
+100 basis points
+5.9
—
-100 basis points
-6.3
—
The calculations were made by vertically increasing (decreasing) 100 basis points of the interest rate curve,
both scenarios being reasonably possible according to historical market conditions.
The sensitivity calculation hypothesis must assume that the forward curves of interest rates will not necessarily
reflect the real value of the compensation of the flows. In addition, the interest rate structure is dynamic over
time.
During the period ended December 31, 2024, the Company did not record any losses for ineffectiveness in the
consolidated income statement for this type of coverage.
(b)
Credit risk
Credit risk occurs when the counterparty does not comply with its obligations to the Company under a specific
contract or financial instrument, resulting in a loss in the market value of a financial instrument (only financial
assets, not liabilities). The customer portfolio as of December 31, 2024 has experienced an decrease by 4%
compared to the balance as of December 31, 2023, mainly due to an decrease in passenger transportation
› 304
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
operations (travel agencies and corporate) that decrease by 2% in its sales, mainly affecting the payment
methods credit card 2%, and cash sales 1%. In relation to the cargo business, it presented a increase in its
operations of 14% compared to December 2023. There was special consideration for the Expected Credit Loss
calculation for the clients with balance at the year end that management considered risky. The Expected Credit
Loss at the end of December 2024 had a decrease 14% compared to the end of December 2023, as a result of
the decrease in the portfolio due to collection, and due to the application of write-offs.
The Company is exposed to credit risk due to its operational activities and its financial activities, including
deposits with banks and financial institutions, investments in other types of instruments, exchange rate
transactions and derivatives contracts.
To reduce the credit risk related to operational activities, the company has implemented credit limits to limit the
exposure of its debtors, which are permanently monitored for the LATAM network, when deemed necessary,
agencies have been blocked for cargo and passenger businesses.
(i)
Financial activities
Cash surpluses that remain after the financing of assets necessary for the operation are invested according to
credit limits approved by the Company’s Board, mainly in time deposits with different financial institutions,
private investment funds and short-term mutual funds. These investments are booked as Cash and cash
equivalents and other current financial assets.
In order to reduce counterparty risk and to ensure that the risk assumed is known and managed by the
Company, investments are diversified among different banking institutions (both local and international). The
Company evaluates the credit standing of each counterparty and the levels of investment, based on (i) its credit
rating, and (ii) investment limits according to the Company’s level of liquidity. According to these two
parameters, the Company chooses the most restrictive parameter of the previous two and based on this,
establishes limits for operations with each counterparty.
The Company has no guarantees to mitigate this exposure.
(ii) Operational activities
The Company has four large sales “clusters”: travel agencies, cargo agents, airlines and credit-card
administrators. The first three are governed by International Air Transport Association (“IATA”), international
organization comprising most of the airlines that represent over 90% of scheduled commercial traffic and one of
its main objectives is to regulate the financial transactions between airlines and travel agents and cargo. When
an agency or airline does not pay their debt, it is excluded from operating with IATA’s member airlines. In the
case of credit-card administrators, they are fully guaranteed by 100% by the issuing institutions.
Under certain of the Company’s credit card processing agreements, the financial institutions have the right to
require that the Company maintain a reserve equal to a portion of advance ticket sales that have been processed
by that financial institution, but for which the Company has not yet provided the air transportation.
Additionally, the financial institutions have the ability to require additional collateral reserves or withhold
payments related to receivables to be collected if increased risk is perceived related to liquidity covenants in
these agreements or negative balances occur.
The exposure consists of the term granted, which fluctuates between 1 and 45 days.
One of the tools the Company uses for reducing credit risk is to participate in global entities related to the
industry, such as IATA, Billing Settlement Plan (“BSP”), Cargo Account Settlement Systems (“CASS”), IATA
Clearing House (“ICH”) and banks (credit cards). These institutions fulfill the role of collectors and distributors
between airlines and travel and cargo agencies. In the case of the Clearing House, it acts as an offsetting entity
between airlines for the services provided between them. A reduction in term and implementation of guarantees
has been achieved through these entities.
The sales invoicing of TAM Linhas Aéreas S.A. related with cargo agents for domestic transportation in Brazil
is done directly by TAM Linhas Aereas S.A.
Credit quality of financial assets
The external credit evaluation system used by the Company is provided by IATA. Internal systems are also
used for particular evaluations or specific markets based on trade reports available on the local market. The
internal classification system is complementary to the external one, i.e. for agencies or airlines not members of
IATA, the internal demands are greater.
To reduce the credit risk associated with operational activities, the Company has established credit limits to
mitigate the exposure of their debtors which are monitored permanently . The bad-debt rate in the principal
countries where the Company has a presence is insignificant.
(c)
Liquidity risk
Liquidity risk represents the risk that the Company does not have sufficient funds to pay its obligations.
Due to the cyclical nature of its business, the operation and investment needs, along with the need for financing,
the Company requires liquid funds, defined as Cash and cash equivalents plus other short-term financial assets,
to meet its payment obligations.
The balance of liquid funds, future cash generation and the ability to obtain financing, provide the Company
with alternatives to meet future investment and financing commitments.
As of December 31, 2024, the balance of liquid funds is US$1,958 million ((US$1,715 million as of December
31, 2023), which are invested in short-term instruments through financial entities with a high credit rating
classification.
As of December 31, 2024, LATAM maintains three Revolving Credit Facility for a total of US$1,850 million,
one for an amount of US$800 million, another for an amount of US$750 million and the last one for US$300
million. The first two are fully available whilst the third has US$25 million undrawn and available. With this,
the sum of the three committed credit lines amounts to a total of US$1,575 million. The first of these lines is
secured by and subject to the availability of certain collateral (i.e. aircraft, engines and spare parts). The second
one, is secured by certain intangibles assets of the Company, which are shared with both international bonds.
The third is collateralized by spare engines. (See Note 31)
› 305
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Class of liability for the analysis of liquidity risk ordered by date of maturity as of December 31, 2024
Debtor: LATAM Airlines Group S.A. Tax No. 89.862.200-2 Chile.
Tax No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More than
five
years
Total
Nominal
value
Amortization
Annual
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Obligations with the public
97.036.000-K
SANTANDER
Chile
UF
—
2,970
5,889
5,889
167,830
182,578
147,217
To the expiration
2.00
2.00
0-E
WILMINGTON
TRUST
COMPANY
U.S.A.
US$
—
203,875
407,750
1,107,750
1,455,125
3,174,500
2,100,000
To the expiration
10.69
9.71
97.036.000-K
SANTANDER
Chile
US$
—
—
—
—
6
6
3
To the expiration
1.00
1.00
Guaranteed obligations
0-E
BNP PARIBAS
U.S.A.
US$
5,996
17,263
45,343
43,928
104,940
217,470
159,624
Quarterly
6.03
6.03
0-E
WILMINGTON
TRUST
COMPANY
U.S.A.
US$
5,770
17,015
43,945
41,683
33,697
142,110
115,727
Quarterly/Monthly
7.73
7.73
0-E
BOCOMM
Ireland
US$
2,724
8,158
20,911
19,790
110,277
161,860
100,000
Quarterly
6.42
6.42
Other guaranteed obligation
0-E
EXIM BANK
U.S.A.
US$
5,447
16,392
43,700
38,590
14
104,143
99,109
Quarterly
2.29
2.05
0-E
CREDIT
AGRICOLE
France
US$
4,097
13,097
35,021
292,571
—
344,786
275,012
To the expiration
6.63
6.63
Financial lease
0-E
NATIXIS
France
US$
10,319
29,916
77,088
112,238
24,493
254,054
191,383
Quarterly
6.73
6.73
0-E
US BANK
U.S.A.
US$
11,210
6,710
—
—
—
17,920
17,492
Quarterly
4.88
3.40
0-E
EXIM BANK
U.S.A.
US$
36,227
82,640
180,932
108,316
36,702
444,817
413,072
Quarterly
4.00
3.17
0-E
BANK OF UTAH
U.S.A.
US$
5,981
18,001
51,307
60,431
86,947
222,667
161,870
Monthly
10.71
10.71
TOTAL
87,771
416,037
911,886
1,831,186
2,020,031
5,266,911
3,780,509
Class of liability for the analysis of liquidity risk ordered by date of maturity as of December 31, 2024
Debtor: TAM S.A. Tax No. 02.012.862/0001-60, Brazil.
Tax No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More than
five
years
Total
Nominal
value
Amortization
Annual
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Financial leases
0-E
NATIXIS
France
US$
510
1,530
4,080
7,846
—
13,966
13,966
Quarterly
—
—
TOTAL
510
1,530
4,080
7,846
—
13,966
13,966
› 306
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Class of liability for the analysis of liquidity risk ordered by date of maturity as of December 31, 2024
Debtor: LATAM Airlines Group S.A. Tax No. 89.862.200-2, Chile.
Tax No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More than
five
years
Total
Nominal
value
Amortization
Annual
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Lease Liability
AIRCRAFT
OTHERS
US$
144,076
507,305
1,171,362
958,537
1,718,984
4,500,264
3,174,757
—
—
—
OTHER
ASSETS
OTHERS
US$
3,717
11,276
31,723
27,462
90,051
164,229
88,854
—
—
—
CLP
1,535
4,604
11,441
10,263
29,935
57,778
36,151
—
—
—
UF
1,264
3,757
9,241
6,523
3,631
24,416
21,425
—
—
—
COP
344
1,016
1,784
56
—
3,200
2,829
—
—
—
EUR
31
92
58
8
—
189
183
—
—
—
BRL
3,072
8,322
18,727
12,425
18,256
60,802
38,082
—
—
—
MXN
87
217
11
—
—
315
299
—
—
—
Trade and other accounts payables
-
OTHERS
OTHERS
US$
1,291,259
6,478
—
—
—
1,297,737
709,933
—
—
—
CLP
65,753
193
—
—
—
65,946
64,317
—
—
—
BRL
224,513
6,621
—
—
—
231,134
409,474
—
—
—
Other
currency
172,749
4,534
—
—
—
177,283
118,189
—
—
—
Accounts payable to related parties currents
Foreign
Qatar Airways
Qatar
US$
—
3,576
—
—
—
3,576
3,576
—
—
—
Foreign
Delta Air Lines,
Inc.
USA
US$
—
9,299
—
—
—
9,299
9,299
—
—
—
Total
1,908,400
567,290
1,244,347
1,015,274
1,860,857
6,596,168
4,677,368
Total
consolidated
1,996,681
984,857
2,160,313
2,854,306
3,880,888
11,877,045
8,471,843
Class of liability for the analysis of liquidity risk ordered by date of maturity as of December 31, 2023
Debtor: LATAM Airlines Group S.A. Tax No. 89.862.200-2 Chile.
Tax No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More than
five
years
Total
Nominal
value
Amortization
Annual
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Bank loans
97.023.000-9
GOLDMAN SACHS
U.S.A.
US$
44,721
127,878
302,953
1,192,355
—
1,667,907
1,089,000
Quarterly
20.31
15.04
Obligations with the public
97.030.000-7
SANTANDER
Chile
UF
—
3,230
6,409
6,409
182,647
198,695
160,214
At Expiration
2.00
2.00
0-E
WILMINGTON
TRUST COMPANY
U.S.A.
US$
—
153,813
307,625
697,438
793,625
1,952,501
1,150,000
At Expiration
15.00
13.38
97.036.000-K
SANTANDER
Chile
US$
—
—
—
—
6
6
3
At Expiration
1.00
1.00
Guaranteed obligations
0-E
BNP PARIBAS
U.S.A.
US$
5,940
17,082
41,319
40,578
120,730
225,649
171,704
Quarterly
6.98
6.98
0-E
WILMINGTON
TRUST COMPANY
U.S.A.
US$
5,948
16,928
42,098
40,736
54,056
159,766
132,585
Quarterly /
Monthly
8.76
8.76
Other guaranteed obligation
0-E
EXIM BANK
U.S.A.
US$
452
1,348
43,531
43,494
16,665
105,490
99,109
Quarterly
2.29
2.05
0-E
MUFG
U.S.A.
US$
12,919
37,926
16,649
—
—
67,494
64,102
Quarterly
7.11
7.11
0-E
CREDIT
AGRICOLE
France
US$
6,451
33,576
75,714
243,842
—
359,583
266,768
At Expiration
9.43
9.43
Financial lease
0-E
NATIXIS
France
US$
10,653
30,443
73,474
70,443
94,995
280,008
215,357
Quarterly
7.58
7.58
0-E
US BANK
U.S.A.
US$
17,984
50,411
17,681
—
—
86,076
84,177
Quarterly
4.41
3.16
0-E
EXIM BANK
U.S.A.
US$
3,262
9,389
216,015
148,582
75,118
452,366
413,072
Quarterly
4.13
3.31
0-E
BANK OF UTAH
U.S.A.
US$
5,891
17,705
47,590
54,357
117,597
243,140
172,582
Monthly
10.71
10.71
Others loans
0-E
OTHERS (*)
Chile
US$
104
—
—
—
—
104
104
At Expiration
—
—
TOTAL
114,325
499,729
1,191,058
2,538,234
1,455,439
5,798,785
4,018,777
(•) Obligation with creditors for executed letters of credit.
› 307
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Class of liability for the analysis of liquidity risk ordered by date of maturity as of December 31, 2023
Debtor: TAM S.A. Tax No. 02.012.862/0001-60, Brazil.
Tax No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More than
five
years
Total
Nominal
value
Amortization
Annual
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Financial Leases
0-E
NATIXIS
France
US$
510
1,530
4,080
9,886
—
16,006
16,006
Semiannual
/Quarterly
—
—
TOTAL
510
1,530
4,080
9,886
—
16,006
16,006
Class of liability for the analysis of liquidity risk ordered by date of maturity as of December 31, 2023
Debtor: LATAM Airlines Group S.A. Tax No. 89.862.200-2, Chile.
Tax
No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More than
five
years
Total
Nominal
value
Amortization
Annual
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Lease Liability
AIRCRAFT
OTHERS
US$
139,599
419,554
1,116,682
928,238
1,685,262
4,289,335
2,894,195
—
—
—
OTHER ASSETS
OTHERS
US$
2,523
7,276
14,863
846
1,404
26,912
25,680
—
—
—
CLP
19
57
94
—
—
170
135
—
—
—
UF
557
1,255
2,906
2,426
5,099
12,243
11,097
—
—
—
COP
122
308
266
148
—
844
667
—
—
—
EUR
63
101
172
23
—
359
296
—
—
—
BRL
2,314
6,871
15,177
14,438
25,742
64,542
35,841
—
—
—
MXN
24
71
8
—
—
103
84
—
—
—
Trade and other accounts payables
OTHERS
OTHERS
US$
846,541
7,063
—
—
—
853,604
709,933
—
—
—
CLP
44,593
8,072
—
—
—
52,665
64,317
—
—
—
BRL
309,999
7,671
—
—
—
317,670
409,474
—
—
—
Other
currency
178,740
5,522
—
—
—
184,262
118,189
—
—
—
Accounts payable to related parties currents
Foreign
Qatar Airways
Qatar
US$
—
2,312
—
—
—
2,312
2,312
—
—
—
Foreign
Delta Air Lines,
Inc.
USA
US$
—
5,132
—
—
—
5,132
5,132
—
—
—
Total
1,525,094
471,265
1,150,168
946,119
1,717,507
5,810,153
4,277,352
Total consolidated
1,639,929
972,524
2,345,306
3,494,239
3,172,946
11,624,944
8,312,135
› 308
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
The Company has fuel, interest rate and exchange rate hedging strategies involving derivatives contracts with
different financial institutions.
As of December 31, 2024, the Company maintains guarantees for US$0.5 million corresponding to derivative
transactions. The decrease is due to: i) Lower collateral transfers to bank counterparties at the time of contract
closing and ii) changes in fuel prices, exchange rates and interest rates. At the end of 2023, the Company had
guarantees for US$12.8 million corresponding to derivative transactions.
3.2.
Capital risk management
The objectives of the Company, in relation to capital management are: (i) to meet the minimum equity
requirements and (ii) to maintain an optimal capital structure.
The Company monitors contractual obligations and regulatory requirements in the different countries where the
group's companies are domiciled to ensure faithful compliance with the minimum equity requirement, the most
restrictive limit of which is to maintain positive liquid equity.
Additionally, the Company periodically monitors the short and long term cash flow projections to ensure that it
has sufficient cash generation alternatives to meet future investment and financing commitments.
The Company's international credit rating is the result of its ability to meet its long-term financial commitments.
As of December 31, 2024, The Company has a national scale rating of BBB+ with positive outlook by Fitch and
a rating of BBB with positive outlook by Feller. On an international scale, it has a rating of BB- with a positive
outlook by Standard & Poor's, a rating of Ba2 with a stable outlook by Moody's and a rating of BB- with a
positive outlook by Fitch.
3.3.
Estimates of fair value.
At December 31, 2024, the Company maintained financial instruments that should be recorded at fair value.
These are grouped into two categories:
1.
Derivative financial instruments:
This category includes the following instruments:
-
Fuel derivative contracts,
-
Currency derivative contracts,
-
Interest rate derivative contracts.
2.
Financial Investments:
This category includes the following instruments:
-
Investments in short-term Mutual Funds (cash equivalent).
The Company has classified the fair value measurement using a hierarchy that reflects the level of information
used in the assessment. This hierarchy consists of 3 levels (I) fair value based on quoted prices in active markets
for identical assets or liabilities, (II) fair value calculated through valuation methods based on inputs other than
quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as
prices) or indirectly (that is, derived from prices) and (III) fair value based on inputs for the asset or liability that
are not based on observable market data.
The fair value of financial instruments traded in active markets, such as investments acquired for trading, is
based on quoted market prices at the close of the period using the current price of the buyer. The fair value of
financial assets not traded in active markets (derivative contracts) is determined using valuation techniques that
maximize use of available market information. Valuation techniques generally used by the Company are quoted
market prices of similar instruments and / or estimating the present value of future cash flows using forward
price curves of the market at period end.
The following table shows the classification of financial instruments at fair value, depending on the level of
information used in the assessment:
As of December 31, 2024
As of December 31, 2023
Fair value measurements
using
values considered as
Fair value measurements
using
values considered as
Fair
value
Level I
Level II
Level
III
Fair
value
Level I
Level II
Level
III
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Assets
Cash and cash equivalents
77,313 77,313
—
— 89,706 89,706
—
—
Short-term mutual funds
77,313 77,313
—
— 89,706 89,706
—
—
Other financial assets, current 15,565
— 15,565
— 22,136
— 22,136
—
Fair value interest rate
derivatives
4,676
—
4,676
—
-
—
-
—
Fair value of fuel
derivatives
7,747
—
7,747
— 22,136
— 22,136
—
Fair value of foreign
currency derivative
3,142
—
3,142
—
—
—
—
—
Liabilities
Other financial liabilities,
current
—
—
—
—
1,544
—
1,544
—
Fair value of foreign
currency derivatives
—
—
—
—
1,544
—
1,544
—
› 309
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Additionally, at December 31, 2024, the Company has financial instruments which are not recorded at fair
value. In order to meet the disclosure requirements of fair values, the Company has valued these instruments as
shown in the table below:
As of December 31, 2024
As of December 31, 2023
Book value
Fair value
Book value
Fair value
ThUS$
ThUS$
ThUS$
ThUS$
Cash and cash equivalents
1,880,475
1,880,475
1,625,055
1,625,055
Cash on hand
1,885
1,885
2,019
2,019
Bank balance
664,173
664,173
552,187
552,187
Overnight
103,761
103,761
75,236
75,236
Time deposits
1,110,656
1,110,656
995,613
995,613
Other financial assets, current
51,730
51,730
152,683
152,683
Other financial assets
51,730
51,730
152,683
152,683
Trade debtors, other accounts receivable and Current
accounts receivable
1,163,707
1,163,707
1,385,910
1,385,910
Accounts receivable from entities related, current
25
25
28
28
Other financial assets, non-current
53,772
53,772
34,485
34,485
Accounts receivable, non-current
12,342
12,342
12,949
12,949
Other current financial liabilities
635,213
837,181
594,519
867,791
Accounts payable for trade and other accounts payable,
current
2,133,572
2,133,572
1,765,279
1,765,279
Accounts payable to entities related, current
12,875
12,875
7,444
7,444
Other financial liabilities, non current
6,515,238
6,361,620
6,341,669
6,174,294
Accounts payable, non current
491,762
491,762
418,587
418,587
The book values of accounts receivable and payable are assumed to approximate their fair values, due to their
short-term nature. In the case of cash on hand, bank balances, overnight, time deposits and accounts payable,
non-current, fair value approximates their carrying values.
The fair value of other financial liabilities is estimated by discounting the future contractual cash flows at the
current market interest rate for similar financial instruments (Level II). In the case of Other financial assets, the
valuation was performed according to market prices at period end. The book value of Other financial liabilities,
current or non-current, do not include lease liabilities.
NOTE 4 - ACCOUNTING ESTIMATES AND JUDGMENTS
The Company has used estimates to value and record some of the assets, liabilities, revenue, expenses and
commitments. Basically, these estimates refer to:
(a)
Impairment of Intangible asset with indefinite useful life
Management conducts an impairment test annually or more frequently if events or changes in circumstances
indicate potential impairment. An impairment loss is recognized for the amount by which the carrying amount
of the cash generating unit (CGU) exceeds its recoverable amount.
Management’s value-in-use calculations included significant judgments and assumptions relating to revenue
growth rates, exchange rates, discount rates, inflation rates, fuel price. The estimation of these assumptions
requires significant judgment by management as these variables are inherently uncertain; however, the
assumptions used are consistent with the Company’s forecasts approved by management. Therefore,
management evaluates and updates the estimates as necessary in light of conditions that affect these variables.
The main assumptions used as well as the corresponding sensitivity analyses are shown in Note 15.
(b)
Depreciation expense and impairment of Properties, Plant and Equipment
The depreciation of assets is calculated based on a straight-line basis, except for certain technical components
depreciated on cycles and hours flown. These useful lives are reviewed on an annual basis according to the
Company’s future economic benefits associated with them.
Changes in circumstances such as: technological advances, business model, planned use of assets or capital
strategy may result in a useful life different from what has been estimated. When it is determined that the useful
life of property, plant, and equipment must be reduced, as may occur in line with changes in planned usage of
assets, the difference between the net book value and estimated recoverable value is depreciated, in accordance
with the revised remaining useful life.
The residual values are estimated according to the market value that the assets will have at the end of their life.
The residual value and useful life of the assets are reviewed, and adjusted if necessary, once a year. When the
value of an asset is greater than its estimated recoverable amount, its value is immediately reduced to its
recoverable amount.
The Company has concluded that the Properties, Plant and Equipment cannot generate cash inflows to a large
extent independent of other assets, therefore the impairment assessment is made as an integral part of the only
Cash Generating Unit maintained by the Company, Air Transport. The Company checks when there are signs
of impairment, whether the assets have suffered any impairment losses at the Cash Generated Unit level.
(c)
Recoverability of deferred tax assets
Management records deferred taxes on the temporary differences that arise between the tax bases of assets and
liabilities and their amounts in the financial statements. Deferred tax assets on tax losses are recognized to the
extent that it is probable that future tax benefits will be available to offset temporary differences.
The Company applies significant judgment in evaluating the recoverability of deferred tax assets. In
determining the amounts of the deferred tax asset to be accounted for, management considers tax planning
strategies, historical profitability, projected future taxable income (considering assumptions such as: growth
rate, exchange rate, discount rate and fuel price consistent with those used in the impairment analysis of the
group's cash-generating unit) and the expected timing of reversals of existing temporary differences.
(d)
Air tickets sold that will not be finally used.
The Company records the sale of air tickets as deferred revenue. Ordinary revenue from the sale of tickets is
recognized in the statement of income when the passenger transportation service is provided or expires due to
non-use. The Company evaluates the probability of expiration of air tickets on a monthly basis, based on the
history of use. A change in this probability could impact revenue in the year in which the change occurs and in
future years.
As of December 31, 2024, deferred revenues associated with air tickets sold amount to ThUS$2,012,661
(ThUS$2,009,242 as of December 31, 2023). A hypothetical change of one percentage point in the probability
of expiration of up to ThUS$10,016 per month (ThUS$10,150 as of December 31, 2023).
(e)
Valuation of the miles and points awarded to the holders of the loyalty programs, pending use.
As of December 31, 2024, deferred revenue associated with the LATAM Pass loyalty program from Spanish-
speaking countries increased to ThUS$949,495 (ThUS$1,099,580 as of December 31, 2023). An hypothetical
change of one percentage point in the probability of redemption would translate into a cumulative impact of
ThUS$33,479 on the results of 2024 (ThUS$31,510 as of December 31, 2023). Deferred revenue associated
with the LATAM Pass Brazil loyalty program increased to ThUS$203,058 as of December 31, 2024
(ThUS$179,151 as of December 31, 2023). An hypothetical change of one percentage point in the exchange
probability would result in an accumulated impact of ThUS$5,537 on the results of 2023 (ThUS$5,125 as of
December 31, 2023).
The company, in conjunction with an external consultant, estimates the probability of non-use based on a
predictive model, according to the redemption behaviors and validity of miles and points using significant
judgments and critical assumptions which consider the historical use activity and the expected use pattern.
› 310
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(f)
Legal Contingencies
In the case of known contingencies, the Company records a provision when it has a present obligation, whether
legal or constructive, as a result of a past event, it is probable that an outflow of resources will be required to
settle the obligation and a reliable estimate of the obligation amount can be made. The assessment of
contingencies inherently involves the exercise of significant judgment and estimates of the outcome of future
events, the likelihood of loss being incurred and when determining whether a reliable estimate of the loss can
be made. The Company assesses its liabilities and contingencies based upon the best information available, uses
the knowledge, experience and professional judgment to the specific characteristics of the known risks. This
process facilitates the early assessment and quantification of potential risks in individual cases or in the
development of contingent matters. If we are unable to reliably estimate the obligation or conclude no loss is
probable but it is reasonably possible that a loss may be incurred, no provision is recorded but the contingency
is disclosed in the notes to the consolidated financial statements.
Company recognized as the present obligation under an onerous contract as a provision when a contract under
which the unavoidable costs of meeting the obligations under the contract exceed the economic benefits
expected to be received under it.
(g)
Leases
In year 2022, as a result of the arrival of new aircraft and the significant change in the flows of many current
contracts, the Company evaluated the relevance in the current scenario of continuing to use the implicit rate, a
methodology used in recent years, or whether it should in instead use a different approximation for calculating
the rate. It was concluded that the implicit rate was not being able to reflect the economic environment in which
the company operates, therefore it was not accurately representing the Company's indebtedness conditions.
Because of this, all new contracts entered into from 2022 and all contracts that were modified from 2022 used
the incremental rate. Existing contracts that remained unchanged continued using the original implicit discount
rate.
(i)
Discount rate
To determine the present value of lease payments, the Company uses the implicit rate in the contracts
when it is easily determinable. Otherwise, it uses the lessee's estimated incremental borrowing rate,
which is derived from the information available at the lease commencement date. We consider our
recent debt issuances as well as publicly available data for instruments with similar characteristics
when calculating our incremental borrowing rates. A one percentage point decrease in our estimate of
the rates used in determining the current lease liabilities for the registered fleet as of December 31,
2024, would increase the lease liability by approximately US$119 million (US$111 million as of
December 31, 2023).
(ii)
Lease term
In determining the lease term, all facts and circumstances that create an economic incentive to exercise
an extension option are considered. Extension options (or periods after termination options) are only
included in the lease term if it is reasonably certain that the lease will be extended (or not terminated).
This is reviewed if a significant event or significant change in circumstances occurs that affects this
assessment and is within the lessee's control.
These estimates are made based on the best information available on the events analyzed.
In any case, it is possible that events that may take place in the future make it necessary to modify them in
future periods, which would be done prospectively.
NOTE 5 - SEGMENT INFORMATION
As of December 31, 2024, the Company considers that it has a single operating segment, Air Transport. This
segment corresponds to the route network for air transport and is based on the way in which the business is
managed, according to the centralized nature of its operations, the ability to open and close routes, as well as
reassignment (airplanes, crew, personnel, etc.) within the network, which implies a functional interrelation
between all of them, making them inseparable. This segment definition is one of the most common in the
worldwide airline industry.
The Company’s revenues by geographic area are as follows:
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
Peru
1,127,532
988,908
Argentina
239,369
244,413
U.S.A.
1,324,008
1,044,822
Europe
957,042
800,897
Colombia
669,206
662,263
Brazil
5,512,471
5,006,377
Ecuador
364,960
332,801
Chile
1,927,847
1,898,150
Asia Pacific and rest of Latin America
710,608
661,910
Income from ordinary activities
12,833,043 11,640,541
Other operating income
200,669
148,641
The Company allocates revenues by geographic area based on the point of sale of the passenger ticket or cargo.
Assets are composed primarily of aircraft and aeronautical equipment, which are used throughout the different
countries, so it is not possible to assign a geographic area.
The Company has no customers that individually represent more than 10% of sales.
› 311
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 6 - CASH AND CASH EQUIVALENTS
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Cash on hand
1,885
2,019
Bank balances (1)
664,173
552,187
Overnight
103,761
75,236
Total Cash
769,819
629,442
Cash equivalents
Time deposits
1,110,656
995,613
Mutual funds
77,313
89,706
Total cash equivalents
1,187,969
1,085,319
Total cash and cash equivalents
1,957,788
1,714,761
(1) As of December 31, 2024, within the item bank balances are ThUS$590,463 related to banks accounts that
pay interest to the Company for the daily or monthly balances (ThUS$391,966 as of December 31, 2023)
Cash and cash equivalents are denominated in the following currencies:
Currency
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Argentine peso
4,228
3,438
Brazilian real
347,041
520,796
Chilean peso
17,943
47,933
Colombian peso
19,042
36,326
Euro
15,721
25,329
US Dollar
1,508,548
1,020,467
Pound Sterling
2,069
5,073
Mexican peso
4,222
8,159
R.P. Chinese Yuan
21,585
20,801
Other currencies
17,389
26,439
Total
1,957,788
1,714,761
NOTE 7 - FINANCIAL INSTRUMENTS
Financial instruments by category
As of December 31, 2024
Assets
Measured at
amortized
cost
At fair value
with changes
in results
Hedge
derivatives
Total
ThUS$
ThUS$
ThUS$
ThUS$
Cash and cash equivalents
1,880,475
77,313
— 1,957,788
Other financial assets, current
51,730
—
15,565
67,295
Trade and others accounts receivable, current
1,163,707
—
— 1,163,707
Accounts receivable from related entities, current
25
—
—
25
Other financial assets, non current
53,772
—
—
53,772
Accounts receivable, non current
12,342
—
—
12,342
Total
3,162,051
77,313
15,565 3,254,929
Liabilities
Measured at
amortized
cost
Hedge
derivatives
Total
ThUS$
ThUS$
ThUS$
Other financial liabilities, current
635,213
—
635,213
Trade and others accounts payable, current
2,133,572
— 2,133,572
Accounts payable to related entities, current
12,875
—
12,875
Other financial liabilities, non-current
6,515,238
— 6,515,238
Accounts payable, non-current
491,762
—
491,762
Total
9,788,660
— 9,788,660
As of December 31, 2023
Assets
Measured at
amortized
cost
At fair value
with changes
in results
Hedge
derivatives
Total
ThUS$
ThUS$
ThUS$
ThUS$
Cash and cash equivalents
1,625,055
89,706
—
1,714,761
Other financial assets, current
152,683
—
22,136
174,819
Trade and others accounts receivable, current
1,385,910
—
—
1,385,910
Accounts receivable from related entities, current
28
—
—
28
Other financial assets, non current
34,485
—
—
34,485
Accounts receivable, non current
12,949
—
—
12,949
Total
3,211,110
89,706
22,136
3,322,952
› 312
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Liabilities
Measured at
amortized
cost
Hedge
derivatives
Total
ThUS$
ThUS$
ThUS$
Other financial liabilities, current
594,519
1,544
596,063
Trade and others accounts payable, current
1,765,279
—
1,765,279
Accounts payable to related entities, current
7,444
—
7,444
Other financial liabilities, non-current
6,341,669
—
6,341,669
Accounts payable, non-current
418,587
—
418,587
Total
9,127,498
1,544
9,129,042
NOTE 8 - TRADE AND OTHER ACCOUNTS RECEIVABLE CURRENT, AND NON-CURRENT
ACCOUNTS RECEIVABLE
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Trade accounts receivable
1,132,923
1,185,792
Other accounts receivable
99,063
277,845
Total trade and other accounts receivable
1,231,986
1,463,637
Less: Expected credit loss
(55,937)
(64,778)
Total net trade and accounts receivable
1,176,049
1,398,859
Less: non-current portion – accounts receivable
(12,342)
(12,949)
Trade and other accounts receivable, current
1,163,707
1,385,910
The fair value of trade and other accounts receivable does not differ significantly from the book value.
To determine the expected credit losses, the Company groups accounts receivable for passenger and cargo
transportation depending on the characteristics of shared credit risk and maturity.
As of December 31, 2024
As of December 31, 2023
Portfolio maturity
Expected
loss rate (1)
Gross book
value (2)
Impairment
loss
Provision
Expected
loss rate (1)
Gross book
value (2)
Impairment
loss
Provision
%
ThUS$
ThUS$
%
ThUS$
ThUS$
Up to date
1%
961,546
(12,550)
1%
1,022,845
(12,672)
From 1 to 90 days
1%
122,350
(1,438)
3%
102,977
(2,989)
From 91 to 180 days
15%
6,510
(978)
25%
8,350
(2,048)
From 181 to 360 days
67%
4,960
(3,325)
44%
7,868
(3,491)
Over 360 days
100%
37,557
(37,646)
100%
43,752
(43,578)
Total
1,132,923
(55,937)
1,185,792
(64,778)
(1) Corresponds to the consolidated expected rate of accounts receivable.
(2) The gross book value represents the maximum credit risk value of trade accounts receivables.
Currency balances composition of Trade and other accounts receivable and non-current accounts receivable are
as follow:
Currency
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Argentine Peso
8,968
13,827
Brazilian Real
722,208
825,749
Chilean Peso
71,628
75,050
Colombian Peso
16,032
12,720
Euro
96,438
90,699
US Dollar
224,169
344,347
Australian Dollar
5,457
5,097
Japanese Yen
4,998
4,695
Pound Sterling
8,488
3,390
Peruvian Sol
699
7,640
Korean Won
309
5,882
Other Currencies
16,655
9,763
Total
1,176,049
1,398,859
Movements of the expected credit losses of Trade accounts receivables are as follows:
Opening
balance
Write-offs
(Increase)
Decrease
Closing
balance
Periods
ThUS$
ThUS$
ThUS$
ThUS$
From January 1 to December 31, 2023
(67,232)
7,122
(4,668)
(64,778)
From January 1 to December 31, 2024
(64,778)
4,578
4,263
(55,937)
Once pre-judicial and judicial collection efforts are exhausted, the assets are written off against the allowance.
The Company only uses the allowance method rather than direct write-off, to ensure control.
The historical and current renegotiations are not significant, and the policy is to analyze case by case to classify
them according to the existence of risk, determining they need to be reclassified to pre-judicial collection
accounts.
The maximum credit-risk exposure at the date of presentation of the information is the fair value of each one of
the categories of accounts receivable indicated above.
As of December 31, 2024
As of December 31, 2023
Gross
exposure
according to
balance
Gross
impaired
exposure
Exposure net
of risk
concentrations
Gross
exposure
according to
balance
Gross
Impaired
exposure
Exposure net
of risk
concentrations
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Trade accounts receivable
1,132,923
(55,937)
1,076,986
1,185,792
(64,778)
1,121,014
Other accounts receivable
99,063
—
99,063
277,845
—
277,845
There are no relevant guarantees covering credit risk and these are valued when they are settled; no materially
significant direct guarantees exist. Existing guarantees, if appropriate, are made through IATA.
› 313
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 9 - ACCOUNTS RECEIVABLE FROM/PAYABLE TO RELATED ENTITIES
(a)
Accounts Receivable
Tax No.
Related party
Relationship
Country
of origin
Currency
As of
December
31, 2024
As of
December 31,
2023
ThUS$
ThUS$
76.335.600-0
Parque de Chile S.A.
Related director
Chile
CLP
2
2
96.810.370-9
Inversiones Costa Verde S.A.
Related director
Chile
CLP
21
25
76.115.378-1
Costa Verde Portafolio S.A.
Related director
Chile
CLP
2
—
81.062.300-4
Costa Verde Aeronautica S.A.
Shareholder
Chile
CLP
—
—
Foreign
Inversora Aeronáutica Argentina S.A.
Related director
Argentina
ARS
—
1
Total current assets
25
28
(b)
Accounts payable
Current liabilities
Tax No.
Related party
Relationship
Country
of origin
Currency
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Foreign
Qatar Airways
Indirect shareholder
Qatar
US$
3,576
2,312
Foreign
Delta Air Lines, Inc.
Shareholder
U.S.A.
US$
9,299
5,132
Total current liabilities
12,875
7,444
Transactions between related parties have been carried out on arm’s length conditions between interested and
duly-informed parties. The transaction terms for the liabilities of the period 2024 correspond from 30 days to 1
year of maturity, and the nature of the settlement of transactions are monetary.
NOTE 10 - INVENTORIES
The composition of Inventories is as follows:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Technical stock (*)
390,259
540,342
Non-technical stock (**)
48,271
52,538
Total
438,530
592,880
(*) Correspond to spare parts and materials that will be used in both own and third-party maintenance services.
(**) Consumption of on-board services, uniforms and other indirect materials
These are valued at their average acquisition cost net of their obsolescence provision according to the following
detail:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Provision for obsolescence Technical stock
76,167
45,621
Provision for obsolescence Non-technical stock
8,700
5,228
Total
84,867
50,849
The resulting amounts do not exceed the respective net realization values.
As of December 31, 2024, the Company registered ThUS$281,792 (ThUS$296,423 for the year ended
December 31, 2023), the income statements, mainly related to on-board consumption and maintenance, which is
part of the Cost of sales.
› 314
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 11 - OTHER FINANCIAL ASSETS
(a)
The composition of other financial assets is as follows:
Current Assets
Non-current assets
Total Assets
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
(1) Other financial assets
Deposits in guarantee (aircraft)
23,057
31,624
32,214
9,736
55,271
41,360
Guarantees for margins of
derivatives
466
12,829
—
—
466
12,829
Other investments
—
—
493
494
493
494
Other guarantees given
28,207
108,230
21,065
24,255
49,272
132,485
Subtotal of other financial assets
51,730
152,683
53,772
34,485
105,502
187,168
(2) Hedging derivative asset
Fair value of interest rate
derivatives
4,676
—
—
—
4,676
—
Fair value of foreign currency
derivatives
3,142
—
—
—
3,142
—
Fair value of fuel price derivatives
7,747
22,136
—
—
7,747
22,136
Subtotal of derivative assets
15,565
22,136
—
—
15,565
22,136
Total Other Financial Assets
67,295
174,819
53,772
34,485
121,067
209,304
The different derivative hedging contracts maintained by the Company are described in Note 18.
(b)
The balances composition by currencies of the Other financial assets are as follows:
Type of currency
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Brazilian real
13,323
18,767
Chilean peso
3,006
6,440
Colombian peso
1,216
1,461
Euro
4,646
7,974
U.S.A dollar
96,359
171,852
Other currencies
2,517
2,810
Total
121,067
209,304
NOTE 12 - OTHER NON-FINANCIAL ASSETS
The composition of other non-financial assets is as follows:
Current assets
Non-current assets
Total Assets
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
(a) Advance payments
Aircraft insurance and other
31,465
25,992
—
—
31,465
25,992
Others
7,097
3,740
24,156
5,740
31,253
9,480
Subtotal advance payments
38,562
29,732
24,156
5,740
62,718
35,472
(b) Contract assets (1)
GDS costs
23,078
22,738
—
—
23,078
22,738
Credit card commissions
33,590
37,200
—
—
33,590
37,200
Travel agencies commissions
8,898
12,421
—
—
8,898
12,421
Subtotal advance payments
65,566
72,359
—
—
65,566
72,359
(c) Other assets
Sales tax
98,142
81,785
6,900
13,753
105,042
95,538
Other taxes
226
1,130
—
—
226
1,130
Contributions to the International
Aeronautical
Telecommunications Society
(“SITA”)
628
258
271
739
899
997
Contributions to Aeronautical
Service Companies
—
—
60
60
60
60
Judicial deposits
537
—
58,029
148,329
58,566
148,329
Subtotal other assets
99,533
83,173
65,260
162,881
164,793
246,054
Total Other Non - Financial Assets
203,661
185,264
89,416
168,621
293,077
353,885
(1) Movement of Contracts assets:
Initial
balance
Activation
Cumulative
translation
adjustment
Amortization Final balance
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
From January 1 to December 31, 2023
48,566
242,717
2,033
(220,957)
72,359
From January 1 to December 31, 2024
72,359
233,572
(6,177)
(234,188)
65,566
› 315
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 13 - NON-CURRENT ASSETS AND DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE
Non-current assets and disposal group classified as held for sale at December 31, 2024 and December 31, 2023,
are detailed below:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Current assets
Aircraft
29,063
100,658
Engines and rotables
75
2,012
Total
29,138
102,670
The balances are presented at the lower of book value and fair value less cost to sell. The fair value of these
assets was determined based on quoted prices in active markets for similar assets or liabilities. This is a level II
measurement as per the fair value hierarchy set out in Note 3.3 (2). There were no transfers between levels for
recurring fair value measurements during the exercise.
Assets reclassified from Property, plant and equipment to Non-current assets or groups of assets for disposal
classified as held for sale.
During 2020, 11 Boeing 767 aircraft were transferred from the Property, plant and equipment, to Non-current
assets item or groups of assets for disposal classified as held for sale. During 2021, the sale of 5 aircraft was
completed. During the year 2022 the sale of 3 aircraft was finalized and during the year 2023 the sale of 1
aircraft was finalized.
During 2021, associated with the fleet restructuring plan, 3 engines of the Airbus A350 fleet were transferred
from the Property, plant and equipment to Non-current assets or groups of assets for disposal classified as held
for sale, of which during the same year the sale of 1 engine was finalized. Additionally, during the year 2022,
the sale of 1 engine was finalized and some materials and spare parts of this same fleet were transferred to Non-
current assets or groups of assets for disposal classified as held for sale. During the year 2023, the sale of 1
engine, some spare parts, and materials was finalized.
During 2022, 28 Airbus A319 family aircraft were transferred from Property, plant and equipment to Non-
current assets or asset groups for disposal classified as held for sale. Additionally, adjustments for US$345
million of expenses were recognized within results as part of Other gains (losses) to record these assets at their
net realizable value. During 2023, the engines associated with these aircraft were added, generating additional
adjustments of US$39 million, which were recorded in the result as part of Other gains (losses), in order to
register these assets at their net realizable value. During the year 2024 the sale of 26 aircraft was finalized.
During 2022, 6 aircraft and 8 engines of the Airbus A320 family were transferred from Property, plant and
equipment to Non-current assets or asset groups for disposal classified as held for sale, and as of December 31,
2022, the sale of 3 aircrafts were finalized and as of December 31, 2023, the sale of 2 aircraft and 8 engines
were finalized. As of December 31, 2024, the sale of 1 aircraft is finalized. During 2022, adjustments for US$25
million of expenses were recognized to record these assets at their net realizable value, and since the fleet
restructuring process had already been completed, these adjustments were recorded in results as part of Other
expenses by function.
During the year 2023, 6 Airbus A320 aircraft were transferred from the Property, Plant, and Equipment
category to the Non-current Assets or Asset Groups held for sale category. Additionally, during the year 2023,
adjustments of US$9 million in expenses were recognized to record these assets at their net realizable value.
These adjustments were recorded in the results as part of Other expenses by function. During the year 2024, the
sale of 6 aircraft was finalized.
During 2023, 1 Boeing 767 family aircraft was transferred from Property, plant and equipment to Non-current
assets or asset groups for disposal classified as held for sale. Additionally, adjustments for US$3 million of
expenses were recognized within results as part of Other expenses by function to record these assets at their net
realizable value. As of December 31, 2024, the sale of 1 Boeing 767 family aircraft is finalized.
The detail of the fleet classified as non-current assets and disposal group classified as held for sale is as follows:
Aircraft
Model
As of
December 31,
2024
As of
December 31,
2023
Boeing 767
300F
2
3
Airbus A320 (*)
200
—
7
Airbus A319 (*)
100
2
28
Total
4
38
(*) As of December 31, 2024, 6 Airbus A320 aircraft and 26 Airbus A319 aircraft were sold and incorporated
into the property, plant and equipment as a result of a sale and lease contract (see Note 16).
NOTE 14 - INVESTMENTS IN SUBSIDIARIES
(a)
Investments in subsidiaries
The Company has investments in companies recognized as investments in subsidiaries. All the companies
defined as subsidiaries have been consolidated within the financial statements of LATAM Airlines Group S.A.
and Subsidiaries. The consolidation also includes special-purpose entities.
Detail of significant subsidiaries:
Ownership
Name of significant subsidiary
Country of
incorporation
Functional
currency
As of
December 31,
2024
As of
December 31,
2023
%
%
Latam Airlines Perú S.A.
Peru
US$
99.81000
99.81000
Lan Cargo S.A.
Chile
US$
99.89810
99.89810
Línea Aérea Carguera de Colombia S.A.
Colombia
US$
90.46000
90.46000
Transporte Aéreo S.A.
Chile
US$
100.00000
100.00000
Latam Airlines Ecuador S.A.
Ecuador
US$
100.00000
100.00000
Aerovías de Integración Regional S.A.
Colombia
COP
99.23168
99.23168
TAM Linhas aéreas S.A.
Brazil
BRL
100.00000
100.00000
ABSA Aerolimhas Brasileiras S.A.
Brazil
US$
100.00000
100.00000
Transportes Aéreos del Mercosur S.A.
Paraguay
PYG
94.98000
94.98000
The consolidated subsidiaries do not have significant restrictions for transferring funds to the parent company.
› 316
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Summary financial information of significant subsidiaries
Statement of financial position as of December 31, 2024
Statement of Income for the year
ended December 31, 2024
Name of significant subsidiary
Total
Assets
Current
Assets
Non-current
Assets
Total
Liabilities
Current
Liabilities
Non-current
Liabilities
Revenue
Net
Income/(loss)
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Latam Airlines Perú S.A.
437,768
401,748
36,020
366,089
342,838
23,251
1,723,518
22,861
Lan Cargo S.A.
490,550
169,684
320,866
263,747
184,144
79,603
413,100
27,238
Línea Aérea Carguera de Colombia S.A.
208,805
83,783
125,022
95,915
95,684
231
255,867
6,011
Transporte Aéreo S.A.
238,354
15,080
223,274
121,609
92,234
29,375
84,885
(10,064)
Latam Airlines Ecuador S.A.
187,139
181,666
5,473
175,309
159,210
16,099
324,601
(9,358)
Aerovías de Integración Regional S.A.
207,096
198,118
8,978
198,165
193,842
4,323
546,752
(59,836)
TAM Linhas Aéreas S.A.
3,633,801
2,209,393
1,424,408
2,221,024
1,594,689
626,335
6,083,071
657,709
ABSA Aerolinhas Brasileiras S.A.
515,562
510,341
5,221
556,527
537,601
18,926
178,502
(2,163)
Transportes Aéreos del Mercosur S.A.
50,132
47,469
2,663
28,225
26,314
1,911
57,120
6,395
Statement of financial position as of December 31, 2023
Statement of Income for the year
ended December 31, 2023
Name of significant subsidiary
Total
Assets
Current
Assets
Non-current
Assets
Total
Liabilities
Current
Liabilities
Non-current
Liabilities
Revenue
Net
Income/(loss)
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Latam Airlines Perú S.A.
334,481
312,628
21,853
285,645
281,208
4,437
1,404,061
(4,666)
Lan Cargo S.A.
391,430
122,877
268,553
189,019
157,003
32,016
403,051
22,677
Línea Aérea Carguera de Colombia S.A.
166,520
57,240
109,280
59,640
59,344
296
222,397
(5,331)
Transporte Aéreo S.A.
280,117
37,436
242,681
151,066
117,121
33,945
387,515
24,871
Latam Airlines Ecuador S.A.
152,676
149,155
3,521
131,488
120,917
10,571
260,426
1,242
Aerovías de Integración Regional S.A.
191,878
186,612
5,266
185,799
182,923
2,876
516,410
(12,724)
TAM Linhas Aéreas S.A.
4,119,149
2,417,115
1,702,034
3,024,805
2,061,406
963,399
5,587,692
736,209
ABSA Aerolinhas Brasileiras S.A.
500,177
490,548
9,629
538,982
510,978
28,004
162,580
28
Transportes Aéreos del Mercosur S.A.
49,713
46,976
2,737
26,772
24,833
1,939
50,990
6,060
(b)
Non-controlling interests
Equity
Tax No.
Country
of origin
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
%
%
ThUS$
ThUS$
Latam Airlines Perú S.A.
Foreign
Peru
0.19000
0.19000
136
93
Aerovías de Integración Regional S.A.
Foreign
Colombia
0.77400
0.77400
(5,517)
(5,049)
Linea Aérea Carguera de Colombia S.A.
Foreign
Colombia
9.54000
9.54000
(7,848)
(8,421)
Transportes Aéreos del Mercosur S.A.
Foreign
Paraguay
5.02000
5.02000
1,100
1,152
Lan Cargo S.A. and Subsidiaries
93.383.000-4
Chile
0.10196
0.10196
191
198
Total
(11,938)
(12,027)
For the year ended
December 31,
For the year ended
December 31,
Incomes
Tax No.
Country
of origin
2024
2023
2024
2023
%
%
ThUS$
ThUS$
Latam Airlines Perú S.A
Foreign
Peru
0.19000
0.19000
43
(9)
Aerovías de Integración Regional S.A.
Foreign
Colombia
0.77400
0.77400
(463)
(101)
Linea Aérea Carguera de Colombia S.A.
Foreign
Colombia
9.54000
9.54000
573
(500)
Transportes Aéreos del Mercosur S.A.
Foreign
Paraguay
5.02000
5.02000
321
304
Lan Cargo S.A. and Subsidiaries
93.383.000-4
Chile
0.10196
0.10196
(1)
25
Total
473
(281)
› 317
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 15 - INTANGIBLE ASSETS OTHER THAN GOODWILL
The details of intangible assets are as follows:
Classes of intangible assets
(net)
Classes of intangible assets
(gross)
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
ThUS$
ThUS$
Airport slots
535,531
658,949
535,531
658,949
Loyalty program
171,717
219,636
171,717
219,636
Computer software
171,144
156,337
661,731
597,164
Developing software
119,376
117,010
119,376
117,010
Other assets
2,402
54
3,717
1,369
Total
1,000,170
1,151,986
1,492,072
1,594,128
a)
Movement in Intangible assets other than goodwill:
Computer
software and
others
Net
Developing
software
Airport
slots
Loyalty
program
Total
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Opening balance as January 1, 2023
143,575
107,652 625,368
203,791 1,080,386
Additions
298
78,846
—
—
79,144
Transfer software and others
69,210
(69,928)
—
—
(718)
Foreign exchange
2,612
440
33,581
15,845
52,478
Amortization
(59,304)
—
—
—
(59,304)
Closing balance as of December 31, 2023
156,391
117,010 658,949
219,636 1,151,986
Opening balance as of January 1, 2024
156,391
117,010 658,949
219,636 1,151,986
Additions
221
101,379
22,666
—
124,266
Withdrawals
(2)
(393)
—
—
(395)
Transfer software and others
96,098
(95,971)
—
—
127
Foreign exchange
(6,607)
(2,649) (146,084)
(47,919) (203,259)
Amortization
(72,555)
—
—
—
(72,555)
Closing balance as of December 31, 2024
173,546
119,376 535,531
171,717 1,000,170
The amortization of each period is recognized in the consolidated income statement within administrative
expenses.
The cumulative amortization of computer software and others as of December 31, 2024 amounts to
ThUS$491,902 (ThUS$442,142 as of December 31, 2023).
b)
Impairment Test Intangible Assets with an indefinite useful life
As of December 31, 2024, the Company maintains only the CGU “Air Transport”.
The CGU “Air transport” considers the transport of passengers and cargo, both in the domestic markets of
Chile, Peru, Argentina, Colombia, Ecuador and Brazil, as well as in a series of regional and international routes
in America, Europe, Africa and Oceania.
As of December 31 2024, in accordance with the accounting policy, the Company performed the annual
impairment test.
The recoverable amount of the CGU was determined based on calculations of the value in use. These
calculations use projections of 5 years of cash flows after taxes from the financial budgets approved by
management. Cash flows beyond the budgeted period are extrapolated using growth rates and estimated average
volumes, which do not exceed long-term average growth rates.
Management’s cash flow projections included significant judgements and assumptions related to annual revenue
growth rates, discount rate, inflation rates, the exchange rate and the price of fuel. The annual revenue growth
rate is based on past performance and management’s expectations of market development in each of the
countries in which it operates. The discount rates used for the CGU "Air transport" are determined in US
dollars, after taxes, and reflect specific risks related to the relevant countries of each of the operations. Inflation
rates and exchange rates are based on the data available from the countries and the information provided by the
Central Banks of the various countries where it operates, and the price of fuel is determined based on estimated
levels of production, the competitive environment of the market in which they operate and their commercial
strategy.
The recoverable values were determined using the following assumptions:
CGU
Air transport
Annual growth rate (Terminal)
%
0,0 – 4,7
Exchange rate
R$/US$
5,4 – 5,7
Discount rate based on the Weighted Average Cost of Capital (WACC)
%
8,2 – 10,2
Fuel Price
US$/barrel
100
The result of the impairment test, which includes a sensitivity analysis of its main variables, showed that the
recoverable amount exceeded the book value of the cash-generating unit, and therefore no impairment was
identified.
The CGU is sensitive to annual growth rates, discounts and exchange rates and fuel price. The sensitivity
analysis included the individual impact of changes in critical estimates in determining recoverable amounts,
namely:
Increase
WACC
Maximum
Decrease rate
Terminal
growth
Minimal
Increase
fuel price
Maximum
US$/barrel
%
%
Air Transportation CGU
10.2
0
100
In none of the above scenarios an impairment of the cash-generating unit was identified.
› 318
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 16 - PROPERTY, PLANT AND EQUIPMENT
The composition by category of Property, plant and equipment is as follows:
Gross Book Value
Accumulated depreciation
Net Book Value
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
a) Property, plant and equipment
Construction in progress (1)
479,871
258,246
—
—
479,871
258,246
Land
39,818
44,244
—
—
39,818
44,244
Buildings
120,736
129,036
(60,313)
(61,478)
60,423
67,558
Plant and equipment
11,727,067
10,738,500
(5,085,126)
(4,508,356)
6,641,941
6,230,144
Own aircraft (3) (4)
10,678,834
9,856,365
(4,831,914)
(4,259,729)
5,846,920
5,596,636
Other (2)
1,048,233
882,135
(253,212)
(248,627)
795,021
633,508
Machinery
24,005
29,092
(22,927)
(27,716)
1,078
1,376
Information technology equipment
158,900
163,382
(139,607)
(146,040)
19,293
17,342
Fixed installations and accessories
174,859
186,179
(126,886)
(131,769)
47,973
54,410
Motor vehicles
48,320
49,560
(42,323)
(44,385)
5,997
5,175
Leasehold improvements
236,509
266,631
(61,760)
(53,201)
174,749
213,430
Subtotal Properties, plant and equipment
13,010,085
11,864,870
(5,538,942)
(4,972,945)
7,471,143
6,891,925
b) Right of use
Aircraft (3)
5,810,997
5,388,147
(3,262,942)
(3,243,065)
2,548,055
2,145,082
Other assets
398,017
248,614
(230,518)
(194,491)
167,499
54,123
Subtotal Right of use
6,209,014
5,636,761
(3,493,460)
(3,437,556)
2,715,554
2,199,205
Total
19,219,099
17,501,631
(9,032,402)
(8,410,501)
10,186,697
9,091,130
(1) As of December 31, 2024, includes advances paid to aircraft and engine manufacturers for ThUS$452,765 (ThUS$242,069 as of December 31,
2023).
(2) Consider mainly rotables and tools.
(3) As of December 31, 2024 , the additions of 9 aircraft, 3 Airbus A320 for ThUS$34,760 and 6 Boeing B777 for ThUS$296,198.
(4) There were reclassified to Non-current assets or groups of assets for disposal as held for sale the following aircrafts: As of December 31, 2023, 1
Boeing B767 and 6 Airbus A320 (see Note 13).
(a)
Movement in the different categories of Property, plant and equipment:
Construction
in progress
Land
Buildings
net
Plant and
equipment
net
Information
technology
equipment
net
Fixed
installations
& accessories
net
Motor
vehicles
net
Leasehold
improvements
net
Property,
Plant and
equipment
net
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Opening balance as January 1, 2023
388,810
44,349
68,996
6,304,848
16,609
37,072
423
160,027
7,021,134
Additions
8,835
—
—
870,640
5,794
4,246
—
48,866
938,381
Disposals
—
—
—
(2,701)
(1)
—
(16)
—
(2,718)
Retirements
(83)
—
—
(87,652)
(12)
(2)
—
—
(87,749)
Depreciation expenses
—
—
(4,104)
(716,590)
(5,918)
(8,789)
(68)
(10,185)
(745,654)
Foreign exchange
726
1,445
1,505
23,845
536
1,276
12
11,497
40,842
Other increases (decreases) (*)
(140,042)
(1,550)
1,161
(156,046)
334
20,607
—
3,225
(272,311)
Changes, total
(130,564)
(105)
(1,438)
(68,504)
733
17,338
(72)
53,403
(129,209)
Closing balance as of December 31, 2023
258,246
44,244
67,558
6,236,344
17,342
54,410
351
213,430
6,891,925
Opening balance as of January 1, 2024
258,246
44,244
67,558
6,236,344
17,342
54,410
351
213,430
6,891,925
Additions
20,754
—
—
1,215,040
9,669
421
—
8,289
1,254,173
Disposals
—
—
—
(2,940)
(8)
—
(2)
—
(2,950)
Retirements
—
—
—
(56,148)
(91)
(89)
—
—
(56,328)
Depreciation expenses
—
—
(3,992)
(771,104)
(5,724)
(8,877)
(65)
(9,790)
(799,552)
Foreign exchange
(1,354)
(4,426)
(3,143)
(108,966)
(1,780)
(5,401)
—
(39,593)
(164,663)
Other increases (decreases) (*)
202,225
—
—
136,506
(115)
7,509
—
2,413
348,538
Changes, total
221,625
(4,426)
(7,135)
412,388
1,951
(6,437)
(67)
(38,681)
579,218
Closing balance as of December 31, 2024
479,871
39,818
60,423
6,648,732
19,293
47,973
284
174,749
7,471,143
(*) As of December 31, 2024 were no aircrafts reclassified. This Amount included the following aircrafts reclassified to Non-current assets or groups
of assets for disposal as held for sale: As of December 31, 2023, 1 Boeing B767 ThUS$(21,578) and 6 Airbus A320 Th US$(36,326).
› 319
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(b)
Right of use assets:
Aircraft
Others
Net right
of use
assets
ThUS$
ThUS$
ThUS$
Opening balance as January 1, 2023
1,326,821
63,706
1,390,527
Additions
1,013,314
2,988
1,016,302
Depreciation expense
(178,570)
(14,816)
(193,386)
Cumulative translate adjustment
56
3,351
3,407
Other increases (decreases)
(16,539)
(1,106)
(17,645)
Total changes
818,261
(9,583)
808,678
Closing balance as of December 31, 2023
2,145,082
54,123
2,199,205
Opening balance as of January 1, 2024
2,145,082
54,123
2,199,205
Additions (*)
601,723
50,838
652,561
Depreciation expense
(284,234)
(27,315)
(311,549)
Cumulative translate adjustment
48
(8,317)
(8,269)
Other increases (decreases)
85,436
98,170
183,606
Total changes
402,973
113,376
516,349
Closing balance as of December 31, 2024
2,548,055
167,499
2,715,554
(*) As of December 31, 2024, the additions of 6 Airbus A320 aircraft and 26 Airbus A319 aircraft as a result of
a sale and lease contract are considered.
(c)
Fleet composition
Aircraft included
in Property,
plant and equipment
Aircraft included
as Rights
of use assets
Total fleet
Aircraft
Model
As of
December
31, 2024
As of
December
31, 2023
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
Boeing 767
300ER
9
(3)
11
(3)
—
—
9
11
Boeing 767
300F
18
(2) (3)
16
(2) (3)
1
1
19
17
Boeing 777
300ER
10
(4)
4
—
(4)
6
10
10
Boeing 787
8
4
4
6
6
10
10
Boeing 787
9
2
2
25
24
27
26
Airbus A319
100
11
(2)
11
(2)
27
1
38
12
Airbus A320
200
86
(2) (4)
83
(2)
49
(4)
46
(1)
135
129
Airbus A320
NEO
3
1
27
23
30
24
Airbus A321
200
19
19
30
30
49
49
Airbus A321
NEO
—
—
14
7
14
7
Airbus A330
200
—
—
2
(5)
—
2
—
Total
162
151
181
144
343
295
(1) Include one aircraft with a short-term lease, which was excluded from the right of use.
(2) Some aircraft of these fleets were reclassified to non-current assets or groups of assets for disposal as held
for sale, (see Note 13).
(3) Considers the conversions from Boeing 767-300ER (passenger) to Boeing 767-300F (freighter) Aircraft.
(4) 9 aircraft from these fleets (3 Airbus A320 and 6 Boeing B777) were transferred from right of use assets to
properties, plants and equipment.
(5) As of December 31, 2024, 2 A330-200 aircraft are added to the fleet under an operating lease with
WAMOS.
(d)
Method used for the depreciation of Property, plant and equipment:
Useful life (years)
Depreciation method
minimum
maximum
Buildings
Straight line without residual value
20
50
Plant and equipment
Straight line with residual value of 20% in the short-haul
fleet and 36% in the long-haul fleet. (*)
5
30
Information technology equipment Straight line without residual value
5
10
Fixed installations and accessories
Straight line without residual value
10
10
Motor vehicle
Straight line without residual value
10
10
Leasehold improvements
Straight line without residual value
5
8
Assets for rights of use
Straight line without residual value
1
25
(*) Except in the case of Boeing 767-300ER, Boeing 777-300ER, Airbus A320 Family and Boeing 767-300F
fleets which consider a lower residual value, due to the extension of their useful life to 22, 23, 25 and 30 years
respectively. Additionally, certain technical components are depreciated based on cycles and hours flown.
(e)
Additional information regarding Property, plant and equipment:
(i)
Property, plant and equipment pledged as guarantee:
Description of Property, plant and equipment pledged as guarantee:
As of
December 31, 2024
As of
December 31, 2023
Guarantee
agent (1)
Creditor
company
Committed
Assets
Fleet
Existing
Debt
Book
Value
Existing
Debt
Book
Value
ThUS$
ThUS$
ThUS$
ThUS$
Wilmington Trust
Company
MUFG
Aircraft and
engines
Airbus A319
—
—
2,703
12,326
Airbus A320
—
—
17,441
151,873
Boeing 767
—
—
20,427
143,281
Wilmington
Wilmington Trust
Company
Aircraft and
engines
Boeing 777
115,727
132,643
132,585
144,186
Credit Agricole
Credit Agricole
Aircraft and
engines
Airbus A319
4,441
2,401
3,413
3,752
Airbus A320
238,131
114,450
190,001
142,075
Airbus A321
7,022
3,920
6,007
4,393
Boeing 767
—
—
8,849
23,018
Boeing 787
117,089
45,703
58,499
38,971
Bank Of Utah
BNP Paribas
Aircraft and
engines
Boeing 787
159,624
196,134
171,704
208,601
Total direct guarantee
642,034
495,251
611,629
872,476
1.
For syndicated loans, given their own characteristics, the guarantee agent is the representative of the
creditors.
The amounts of the current debts are presented at their nominal value. The net book values correspond to the
assets granted as collateral.
Additionally, there are indirect guarantees associated with assets booked within Property, Plant and Equipment
whose total debt as of December 31, 2024, amounts to Th$US$897,783 (ThUS$898,166 as of December 31,
› 320
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
2023). The book value of the assets with indirect guarantees as of December 31, 2024, amounts to
ThUS$1,734,431 (ThUS$1,925,069 as of December 31, 2023).
As of December 31, 2024, the Company keeps valid letters of credit related to right of use assets according to
the following detail:
Creditor Guarantee
Debtor
Type
Value
ThUS$
Release
date
Celestial Aviation Services Limited
LATAM Airlines Group S.A.
Three letters of credit
7,686
Dec 6, 2025
Empreendimentos Imobiliarios LTDA
Tam Linhas Aéreas S.A.
One letter of credit
20,186
Apr 29, 2025
27,872
(ii)
Commitments and others
Fully depreciated assets and commitments for future purchases are as follows:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Gross book value of fully depreciated property, plant and equipment still in use
326,642
288,454
Commitments for the acquisition of aircraft (*)
20,400,000
15,700,000
(*) According to the manufacturer’s price list.
Aircraft purchase commitments:
Year of delivery
Manufacturer
2025
2026
2027
2028-2030
Total
Airbus S.A.S.
A320neo Family
7
12
10
56
85
The Boeing Company
Boeing 787-9
-
-
1
14
15
Total
7
12
11
70
100
As of December 31, 2024, as a result of the different aircraft purchase contracts signed with Airbus S.A.S., 85
Airbus of the A320 family aircraft with deliveries between 2025 and 2030, remain to be received. The
approximate amount, according to manufacturer list prices, is ThUS$13,900,000.
As of December 31, 2024, as a result of the different aircraft purchase contracts signed with The Boeing
Company, 15 Boeing aircraft of the 787 with deliveries between 2027 and 2030, remain to be received. The
approximate amount, according to manufacturer list prices, is ThUS$6,500,000.
The delivery dates of some of these aircraft could be modified as a result of the continuous discussions that are
held with suppliers in the context of the current manufacturers' supply chain.
Aircraft operational lease commitments:
As of December 31, 2024, as a result of the different aircraft operating lease contracts signed with AerCap
Holdings N.V., 4 aircraft Boeing 787 Dreamliner aircraft with delivery date between 2025 and 2026, remain to
be received.
As of December 31, 2024, as a result of the various aircraft operating lease contracts signed with China Aircraft
Leasing Group Holdings Limited, 3 Airbus of the A320Neo family aircraft with a delivery date in 2025, remain
to be received.
As of December 31, 2024, as a result of the various aircraft operating lease contracts signed with Air Lease
Corporation, 5 Airbus model A321XLR aircraft with deliveries between 2026 and 2027, remain to be received.
As of December 31, 2024, as a result of the various aircraft operating lease contracts signed with BOC Aviation
Limited, 1 Airbus of the A320Neo family aircraft with delivery date in 2025, remain to be received.
As of December 31, 2024, as a result of the various aircraft operating lease contracts signed with WAMOS Air
S.A., 1 Airbus model A330 aircraft with delivery date in 2025, remain to be received.
As of December 31, 2024, as a result of the various aircraft operating lease contracts signed with Maverick
Leasing (Ireland) DAC, 3 Airbus of the A320Neo family aircraft with delivery date in 2025, remain to be
received.
As of December 31, 2024, as a result of the various aircraft operating lease contracts signed with Jackson
Square Aviation Ireland Limited, 4 Airbus model A320 Neo family aircraft with delivery date in 2025, remain
to be received.
(iii)
Capitalized interest costs with respect to Property, plant and equipment.
For the year ended December
31,
2024
2023
Average rate of capitalization of capitalized interest
costs
%
10.77
10.66
Costs of capitalized interest
ThUS$
27,506
10,136
NOTE 17 - CURRENT AND DEFERRED TAXES
In the period ended December 31, 2024, the income tax provision was calculated and recorded, applying the
semi-integrated tax system and a rate of 27%, based on the provisions of the Law. No. 21,210, published in the
Official Gazette of the Republic of Chile, dated February 24, 2020, which updates the Tax Legislation.
The net result for deferred tax corresponds to the variation of the period, of the assets and liabilities for deferred
taxes generated by temporary differences and tax losses.
For the permanent differences that give rise to a book value of assets and liabilities other than their tax value, no
deferred tax has been recorded since they are caused by transactions that are recorded in the financial statements
and that will have no effect on income tax expense.
(a)
Current taxes
(a.1)
The composition of the current tax assets is the following:
Current assets
Non-current assets
Total assets
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Provisional monthly payments
(advances)
14,616
18,982
—
—
14,616
18,982
Other recoverable credits
25,659
28,048
—
—
25,659
28,048
Total current tax assets
40,275
47,030
—
—
40,275
47,030
› 321
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(a.2)
The composition of the current tax liabilities are as follows:
Current liabilities
Non-current liabilities
Total liabilities
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Income tax provision
6,281
2,371
—
—
6,281
2,371
Total current tax liabilities
6,281
2,371
—
—
6,281
2,371
(b)
Deferred taxes
The balances of deferred tax are the following:
Assets
Liabilities
Concept
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
ThUS$
ThUS$
Properties, Plants and equipment
(821,883)
(941,136)
53,543
70,745
Assets by right of use
(720,694)
(585,957)
109
54
Lease Liabilities
892,657
792,781
(113)
(74)
Amortization
(101,193)
(112,002)
—
10
Provisions
80,355
222,409
76,280
81,091
Revaluation of financial instruments
—
(889)
—
—
Tax losses
664,990
613,264
(68,493)
(86,320)
Intangibles
—
—
234,854
300,359
Other
16,317
16,312
16,497
16,494
Total
10,549
4,782
312,677
382,359
The balance of deferred tax assets and liabilities are composed primarily of temporary differences to be reversed
in the long term.
Movements of Deferred tax assets and liabilities
(b.1)
From January 1 to December 31, 2023
Opening
balance
Assets/
(liabilities)
Recognized in
consolidated
income
Recognized in
comprehensive
income
Exchange
rate
variation
Ending
balance
Asset
(liability)
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Property, plant and equipment
(1,088,140)
76,259
—
—
(1,011,881)
Assets for right of use
(367,182)
(218,829)
—
—
(586,011)
Lease Liabilities
586,993
205,862
—
—
792,855
Amortization
(88,182)
(23,830)
—
—
(112,012)
Provisions
(60,386)
200,953
751
—
141,318
Revaluation of financial instruments
2,438
(6,931)
3,604
—
(889)
Tax losses (*)
946,659
(247,075)
—
—
699,584
Intangibles
(270,512)
(6,207)
—
(23,640)
(300,359)
Others
(398)
216
—
—
(182)
Total
(338,710)
(19,582)
4,355
(23,640)
(377,577)
(b.2)
From January 1 to December 31, 2024
Opening
balance
Assets/
(liabilities)
Recognized in
consolidated
income
Recognized in
comprehensive
income
Exchange
rate
variation
Ending
balance
Asset
(liability)
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Property, plant and equipment
(1,011,881)
136,455
—
—
(875,426)
Assets for right of use
(586,011)
(134,792)
—
—
(720,803)
Lease Liabilities
792,855
99,915
—
—
892,770
Amortization
(112,012)
10,819
—
—
(101,193)
Provisions
141,318
(138,152)
909
—
4,075
Revaluation of financial instruments
(889)
889
—
—
—
Tax losses (*)
699,584
33,899
—
—
733,483
Intangibles
(300,359)
496
—
65,009
(234,854)
Others
(182)
2
—
—
(180)
Total
(377,577)
9,531
909
65,009
(302,128)
(*) Unrecognized deferred tax assets:
Deferred tax assets are recognized to the extent that it is probable that sufficient taxable profits will be
generated in the future. In total the Company has not recognized deferred tax assets for ThUS$3,263,150 at
December 31, 2024 (ThUS$3,572,528 as of December 31, 2023) which include deferred tax assets related to
negative tax results of ThUS$11,736,014 at December 31, 2024 (ThUS$12,206,634 at December 31, 2023).
› 322
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(Expenses) / Income from deferred taxes and income tax:
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
Income tax (expense)/benefit
Current tax (expense) benefit
(26,263)
(12,659)
Adjustments to the current tax of the previous year
—
(193)
Total current tax (expense) benefit
(26,263)
(12,852)
(Expense)/benefit for deferred tax recognition for tax losses (*)
243
17,492
Deferred income for relative taxes to the creation and reversal of
temporary differences
9,531
(19,582)
Total deferred income tax
9,774
(2,090)
Income tax (expense)/benefit
(16,489)
(14,942)
Income tax (expense) / Income benefit:
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
Current tax (expense) benefit, foreign
(54,190)
(10,410)
Current tax (expense) benefit, domestic
27,927
(2,442)
Total current tax (expense) benefit
(26,263)
(12,852)
Foreign Deferred tax (expense) benefit, for tax losses
compensation (*)
243
17,492
Deferred tax (expense) benefit, foreign
5,553
(10,780)
Deferred tax (expense) benefit, domestic
3,978
(8,802)
Total deferred tax (expense)benefit
9,774
(2,090)
Income tax (expense)/benefit
(16,489)
(14,942)
(*) As a result of an agreement reached with the Brazilian tax authority, in the 2023 TAM Linhas Aereas S.A.
was authorized to use part of its available tax losses to pay some tax contingencies. As the company does not
recognize a deferred tax asset for its available tax losses, it was necessary to register an income in order to write
off the liability previously recognized regarding the relevant tax contingencies.
Income before tax from the Chilean legal tax rate (27% as of December 31, 2024 and 2023)
For the year ended
December 31,
For the year ended
December 31,
2024
2023
2024
2023
ThUS$
ThUS$
%
%
Income tax benefit/(expense) using the legal tax rate
(268,362)
(161,053)
(27.00)
(27.00)
Tax effect of rates in other jurisdictions
(46,580)
(50,042)
(4.69)
(8.39)
Tax effect of non-taxable income
81,612
25,459
8.21
4.27
Tax effect of disallowable expenses
(12,780)
(23,272)
(1.29)
(3.90)
Other increases (decreases):
Derecognition of deferred tax liabilities for early termination of
aircraft financing
37,793
53,162
3.80
8.91
Unrecognised deferred tax
159,430
157,089
16.04
26.34
Other increases (decreases)
32,398
(16,285)
3.27
(2.73)
Total adjustments to tax expense using the legal rate
251,873
146,111
25.34
24.50
Income tax benefit/(expense) using the effective rate
(16,489)
(14,942)
(1.66)
(2.50)
Deferred taxes related to items charged to equity:
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
Aggregate deferred taxation of components of other comprehensive
income
909
4,355
NOTE 18 - OTHER FINANCIAL LIABILITIES
The composition of other financial liabilities is as follows:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Current
(a) Interest bearing loans
271,753
292,982
(b) Lease Liability
363,460
301,537
(c) Hedge derivatives
—
1,544
Total current
635,213
596,063
Non-current
(a) Interest bearing loans
3,516,117
3,675,212
(b) Lease Liability
2,999,121
2,666,457
Total non-current
6,515,238
6,341,669
› 323
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(a)
Interest bearing loans
Obligations with credit institutions and debt instruments:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Current
Bank loans (2)
—
53,141
Guaranteed obligations (5)
34,083
28,697
Other guaranteed obligations (1)
23,682
67,005
Subtotal bank loans
57,765
148,843
Obligation with the public (3) (4)
46,256
34,731
Financial leases
167,732
109,304
Other loans
—
104
Total current
271,753
292,982
Non-current
Bank loans (2)
—
976,293
Guaranteed obligations (5)
339,960
275,225
Other guaranteed obligations (1)
351,069
363,345
Subtotal bank loans
691,029
1,614,863
Obligation with the public (3) (4)
2,193,047
1,268,107
Financial leases
632,041
792,242
Total non-current
3,516,117
3,675,212
Total obligations with financial institutions
3,787,870
3,968,194
(1) The Company has three committed credit lines, or “Revolving Credit Facilities (RCF),” which are secured.
As of July 15, 2024, two credit lines were amended and extended until July 2029, with amounts of US$800
million and US$750 million, respectively. Then, as of November 4, 2024 a third credit line was made available:
(a) The first committed credit line, or “RCF I,” amounting to US$800 million, is secured by aircraft, engines,
and spare parts. This credit line is fully available as of December 31, 2024.
(b) The second committed credit line, or “RCF II,” amounting to US$750 million, is secured by intangible
assets primarily related to the FFP business (LATAM Pass loyalty program), the cargo business, certain slots,
gates, and routes, as well as intellectual property and certain LATAM trademarks. This credit line is fully
available as of December 31, 2024.
(c) On November 4, 2024, the Company secured a new credit line under a “Spare Engine Facility” amounting to
US$300 million (of which US$275 million had been drawn as of December 31, 2024), maturing on November
4, 2028. This funds were used to repay the previous “Spare Engine Facility” maturing on November 3, 2027.
This new financing includes a minimum liquidity covenant, requiring the Company to maintain minimum
liquidity, measured at the consolidated level (LATAM Airlines Group S.A.), of US$750 million, as well as an
additional covenant measured individually for LATAM Airlines Group S.A. and TAM Linhas Aéreas S.A.,
requiring a minimum liquidity threshold of US$400 million. If these covenants are not met, the obligations
could be accelerated at the creditors' request to become short-term obligations. As of December 31, 2024, the
Company is in compliance with the aforementioned minimum liquidity covenants.
(2) As of October 15, 2024, the Company repaid the entirety of the “Term Loan B Facility” amounting to
US$1.081 billion remaining on that date.
(3) As of October 15, 2024, the Company repaid in full the senior secured notes issued under Rule 144-A and
Regulation S of the United States Securities and Exchange Commission, bearing interest at 13.375% and
maturing in 2027, for an aggregate principal amount of US$450 million (the “2027 Notes”). As of December
31, 2024, the Company continues to hold the senior secured notes issued under Rule 144-A and Regulation S of
the United States Securities and Exchange Commission, bearing interest at 13.375% and maturing in 2029, for
an aggregate principal amount of US$700 million (the “2029 Notes”). During the quarter ended December 31,
2024, both the 2027 Notes and the 2029 Notes included a minimum liquidity covenant, which required the
Company to maintain minimum liquidity, measured at the consolidated level (LATAM Airlines Group S.A.), of
US$750 million. If this covenant is not met, the obligations could be accelerated at the creditors' request to
become short-term obligations. As of December 31, 2024, the Company is in compliance with the
aforementioned minimum liquidity covenant.
(4) As of October 15, 2024, the Company issued, placed, and received funds from international markets
through guaranteed bonds amounting to US$1.4 billion, with an annual interest rate of 7.875% and maturing in
2030 (the “2030 Notes”), issued under Rule 144-A and Regulation S of the United States Securities and
Exchange Commission, pursuant to the United States Securities Act of 1933 (the “US Securities Act”). During
the quarter ended December 31, 2024, the 2030 Notes included a minimum liquidity covenant, which required
the Company to maintain minimum liquidity, measured at the consolidated level (LATAM Airlines Group
S.A.), of US$750 million. If this covenant is not met, the obligations could be accelerated at the creditors'
request to become short-term obligations. As of December 31, 2024, the Company is in compliance with the
aforementioned minimum liquidity covenant.
(5) On December 23 and 30, 2024, two A320neo aircraft were delivered by Airbus. These aircraft were
purchased through aircraft financing of US$50 million each, with Bank of Communications Co., Ltd.
(“BOCOMM”) as the counterparty.
Balances by currency of interest bearing loans are as follows:
As of
December 31,
2024
As of
December 31,
2023
Currency
ThUS$
ThUS$
Chilean peso (U.F.)
147,716
160,730
US Dollar
3,640,154
3,807,464
Total
3,787,870
3,968,194
› 324
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Interest-bearing loans due in installments to December 31, 2024
Debtor: LATAM Airlines Group S.A. and Subsidiaries, Tax No. 89.862.200-2, Chile.
Nominal values
Accounting values
Tax No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More than
five
years
Total
nominal
value
Up to
90
days
More
than
90 days
to one
year
More
than
one to
three
years
More than
three to
five
years
More than
five
years
Total
accounting
value
Amortization
Annual
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Obligations with the public
97.036.000-K
SANTANDER
Chile
UF
—
—
—
—
147,217
147,217
—
499
—
—
147,217
147,716
At Expiration
2.00
2.00
97.036.000-K
SANTANDER
Chile
US$
—
—
—
—
3
3
—
—
—
—
3
3
At Expiration
1.00
1.00
0-E
WILMINGTON TRUST
COMPANY
U.S.A.
US$
—
—
—
700,000
1,400,000
2,100,000
—
45,757
—
678,079
1,367,748
2,091,584
At Expiration
10.69
9.71
Guaranteed obligations
0-E
BNP PARIBAS
U.S.A.
US$
3,226
9,863
27,888
30,093
88,554
159,624
4,020
9,863
27,262
29,715
88,375
159,235
Quarterly
6.03
6.03
0-E
WILMINGTON TRUST
COMPANY
U.S.A.
US$
3,960
11,992
33,179
34,951
31,645
115,727
3,960
11,992
33,179
34,951
31,645
115,727
Quarterly/Monthly
7.73
7.73
0-E
BOCOMM
Irlanda
US$
1,042
3,125
8,333
8,333
79,167
100,000
1,123
3,125
8,208
8,250
78,375
99,081
Quarterly
6.42
6.42
Other guaranteed
obligations
0-E
CITIBANK
U.S.A.
US$
—
—
—
—
—
—
22
—
—
—
—
22
Quarterly
1.00
1.00
0-E
JP MORGAN CHASE
U.S.A.
US$
—
—
—
—
—
—
209
—
—
—
—
209
Quarterly
0.63
0.63
0-E
CREDIT AGRICOLE
France
US$
—
—
—
275,012
—
275,012
3,020
—
—
272,112
—
275,132
At Expiration
6.63
6.63
0-E
EXIM BANK
U.S.A.
US$
5,005
15,147
41,385
37,572
—
99,109
5,284
15,147
41,385
37,572
—
99,388
Quarterly
2.29
2.05
Financial leases
0-E
NATIXIS
France
US$
6,671
20,241
55,696
78,423
30,352
191,383
8,284
20,242
55,369
78,225
30,350
192,470
Quarterly
6.73
6.73
0-E
US BANK
U.S.A.
US$
10,972
6,520
—
—
—
17,492
11,147
6,217
—
—
—
17,364
Quarterly
4.88
3.40
0-E
EXIM BANK
U.S.A.
US$
32,988
74,220
167,003
103,326
35,535
413,072
34,733
74,221
166,291
103,326
35,532
414,103
Quarterly
4.00
3.17
0-E
BANK OF UTAH
U.S.A.
US$
2,857
7,991
29,220
46,016
75,786
161,870
2,857
7,991
29,220
46,016
75,786
161,870
Monthly
10.71
10.71
Total
66,721
149,099
362,704
1,313,726
1,888,259
3,780,509
74,659
195,054
360,914
1,288,246
1,855,031
3,773,904
Interest-bearing loans due in installments to December 31, 2024
Debtor: TAM S.A. and Subsidiaries, Tax No. 02.012.862/0001-60, Brazil
Nominal values
Accounting values
Annual
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More
than
five
years
Total
nominal
value
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More
than
five
years
Total
accounting
value
Amortization
Tax No.
Creditor
Country
Currency
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Financial lease
0-E
NATIXIS
France
US$
510
1,530
4,080
7,846
—
13,966
510
1,530
4,080
7,846
—
13,966
Quarterly
—
—
Total
510
1,530
4,080
7,846
—
13,966
510
1,530
4,080
7,846
—
13,966
Total consolidated
67,231
150,629
366,784
1,321,572
1,888,259
3,794,475
75,169
196,584
364,994
1,296,092
1,855,031
3,787,870
› 325
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Interest-bearing loans due in installments to December 31, 2023
Debtor: LATAM Airlines Group S.A. and Subsidiaries, Tax No. 89.862.200-2, Chile.
Nominal values
Accounting values
Amortization
Annual
Tax No.
Creditor
Creditor
country
Currency
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More
than
five
years
Total
nominal
value
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More
than
five
years
Total
accounting
value
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Bank loans
0-E
GOLDMANS
ACHS
U.S.A.
US$
2,750
8,250
22,000
1,056,000
—
1,089,000
44,891
8,250
22,000
954,293
—
1,029,434
Quarterly
20.31
15.04
Obligations
with the public
97.036.000- K
SANTANDER
Chile
UF
—
—
—
—
160,214
160,214
—
516
—
—
160,214
160,730
At Expiration
2.00
2.00
97.036.000- K
SANTANDER
Chile
US$
—
—
—
—
3
3
—
—
—
—
3
3
At Expiration
1.00
1.00
0-E
WILMINGTO
N TRUST
COMPANY
U.S.A.
US$
—
—
—
450,000
700,000
1,150,000
—
34,215
—
434,204
673,686
1,142,105
At Expiration
15.00
13.38
Guaranteed
obligations
0-E
BNP
PARIBAS
U.S.A.
US$
2,912
9,168
26,772
28,945
103,907
171,704
3,936
9,168
26,121
28,553
103,541
171,319
Quarterly
6.98
6.98
0-E
WILMINGTO
N TRUST
COMPANY
U.S.A.
US$
3,854
11,693
32,356
34,083
50,599
132,585
3,900
11,693
32,356
34,083
50,571
132,603
Quarterly/
Monthly
8.76
8.76
Other
guaranteed
obligations
0-E
CITIBANK
U.S.A.
US$
—
—
—
—
—
—
33
—
—
—
—
33
Quarterly
1.00
1.00
0-E
JP MORGAN
CHASE
U.S.A.
US$
—
—
—
—
—
—
17
—
—
—
—
17
Quarterly
0.63
0.63
0-E
CREDIT
AGRICOLE
France
US$
—
14,667
29,333
222,768
—
266,768
4,241
14,667
26,154
221,708
—
266,770
At Expiration
9.43
9.43
0-E
MUFG
U.S.A.
US$
11,768
35,960
16,374
—
—
64,102
11,805
35,960
16,374
—
—
64,139
Quarterly
7.11
7.11
0-E
EXIM BANK
U.S.A.
US$
—
—
40,662
42,122
16,325
99,109
282
—
40,662
42,122
16,325
99,391
Quarterly
2.29
2.05
Financial
leases
0-E
NATIXIS
France
US$
6,516
19,779
54,443
56,972
77,647
215,357
8,559
19,779
54,117
56,754
77,555
216,764
Quarterly
7.58
7.58
0-E
US BANK
U.S.A.
US$
17,374
49,311
17,492
—
—
84,177
17,905
49,311
15,731
—
—
82,947
Quarterly
4.41
3.16
0-E
EXIM BANK
U.S.A.
US$
—
—
197,499
141,169
74,404
413,072
1,933
—
195,741
141,169
74,404
413,247
Quarterly
4.13
3.31
0-E
BANK OF
UTAH
U.S.A.
US$
2,575
7,202
23,637
37,304
101,864
172,582
2,575
7,202
23,637
37,304
101,864
172,582
Monthly
10.71
10.71
Other loan
0-E
Various (*)
US$
104
—
—
—
—
104
104
—
—
—
—
104
At Expiration
—
—
Total
47,853
156,030
460,568
2,069,363
1,284,963
4,018,777
100,181
190,761
452,893
1,950,190
1,258,163
3,952,188
(*)
Obligation to creditors for executed letters of credit.
Interest-bearing loans due in installments to December 31, 2023
Debtor: TAM S.A. and Subsidiaries, Tax No. 02.012.862/0001-60, Brazil
Tax No.
Creditor
Country
Currency
Nominal values
Accounting values
Amortization
Annual
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More
than
five
years
Total
nominal
value
Up to
90
days
More than
90 days
to one
year
More than
one to
three
years
More than
three to
five
years
More
than
five
years
Total
accounting
value
Effective
rate
Nominal
rate
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
%
%
Financial
lease
0-E
NATIXIS
France
US$
510
1,530
4,080
9,886
—
16,006
510
1,530
4,080
9,886
—
16,006
Quarterly
—
—
Total
510
1,530
4,080
9,886
—
16,006
510
1,530
4,080
9,886
—
16,006
Total consolidated
48,363
157,560
464,648
2,079,249
1,284,963
4,034,783
100,691
192,291
456,973
1,960,076
1,258,163
3,968,194
› 326
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(b)
Lease Liability:
The movement of the lease liabilities corresponding to the period reported are as follow:
Aircraft
Others
Lease
Liability
Total
ThUS$
ThUS$
ThUS$
Opening balance as January 1, 2023
2,134,972
81,482
2,216,454
New contracts
943,178
2,976
946,154
Lease termination
(13,258)
(1,812)
(15,070)
Renegotiations
(7,194)
2,219
(4,975)
Payments
(376,006)
(23,277)
(399,283)
Accrued interest
212,500
9,633
222,133
Exchange differences
—
2,278
2,278
Cumulative translation adjustment
6
297
303
Changes
759,226
(7,686)
751,540
Closing balance as of December 31, 2023
2,894,198
73,796
2,967,994
Opening balance as of January 1, 2024
2,894,198
73,796
2,967,994
New contracts
576,182
69,061
645,243
Lease termination
(72,266)
(540)
(72,806)
Renegotiations
96,155
70,670
166,825
Payments
(605,584)
(26,630)
(632,214)
Accrued interest
288,165
25,391
313,556
Exchange differences
(2,090)
(3,082)
(5,172)
Cumulative translation adjustment
—
(9,679)
(9,679)
Other variations
—
(11,166)
(11,166)
Changes
280,562
114,025
394,587
Closing balance as of December 31, 2024
3,174,760
187,821
3,362,581
The Company recognizes interest payments related to lease liabilities in the consolidated result under Finance
costs (See Note 26(c)). The weighted average discount rates for calculation of lease liability are as follows.
Discount rate
December 2024
Discount rate
December 2023
Aircraft
9.09 %
9.10 %
Others
8.78 %
6.43 %
(c) Hedge derivatives
Current liabilities
Non-current liabilities
Total hedge derivatives
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Fair value of foreign
currency derivatives
—
1,544
—
—
—
1,544
Total hedge derivatives
—
1,544
—
—
—
1,544
The foreign currency derivatives correspond to options, forwards and swaps.
Hedging operation
The fair values of net assets/ (liabilities), by type of derivative, of the contracts held as hedging instruments are
presented below:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Fuel options
(1)
7,747
22,136
Foreign currency derivative R$/BRL$
(2)
3,142
(1,544)
Interest rate swaps
(3)
4,676
—
(1) Hedge significant variations in cash flows associated with market risk implicit in the changes in the price
of future fuel purchases. These contracts are recorded as cash flow hedges.
(2) Hedge significant variations in expected cash flows associated with the market risk implicit in changes in
exchange rates, particularly the US$/BRL. These contracts are recorded as cash flow hedge contracts.
(3) They cover significant variations in cash flows associated with the market risk implicit in increases in
the SOFR interest rate for long-term loans originated by the operational leases. These contracts are
recorded as cash flow hedging contracts.
The Company only maintains cash flow hedges. In the case of fuel and currency hedges, the cash flows
subject to said hedges will occur and will impact results in the next 12 months from the date of the consolidated
statement of financial position.
All hedging operations have been performed for highly probable transactions. See Note 3.
See Note 24 (h) for reclassification to profit or loss for each hedging operation and Note 17 (b) for deferred
taxes related.
› 327
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 19 - TRADE AND OTHER ACCOUNTS PAYABLES
The composition of Trade and other accounts payables is as follows:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Current
(a) Trade and other accounts payables
1,761,814
1,408,201
(b) Accrued liabilities
371,758
357,078
Total trade and other accounts payables
2,133,572
1,765,279
(a)
Trade and other accounts payable:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Trade creditors
1,409,894
1,176,985
Other accounts payable
351,920
231,216
Total
1,761,814
1,408,201
The details of Trade and other accounts payables are as follows:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Maintenance and technical purchases
380,853
293,768
Boarding Fees
268,353
249,291
Aircraft Fuel
220,343
94,878
Airport charges and overflight
157,691
138,901
Handling and ground handling
122,721
133,114
Leases, maintenance and IT services
121,901
100,842
Other personnel expenses
106,277
96,351
Professional services and advisory
77,548
63,756
Services on board
72,902
58,365
Marketing
46,751
51,035
Aircraft Insurance
16,756
12,256
Air companies
9,778
26,371
Crew
20,560
25,936
Agencies sales commissions
15,649
16,899
Others
123,731
46,438
Total trade and other accounts payables
1,761,814
1,408,201
71
(b) Liabilities accrued:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Aircraft and engine maintenance
74,874
129,473
Accrued personnel expenses
86,743
97,733
Accounts payable to personnel (1)
183,153
114,769
Others accrued liabilities
26,988
15,103
Total accrued liabilities
371,758
357,078
(1) Participation in profits and bonuses (Note 22 letter b).
NOTE 20 - OTHER PROVISIONS
Current liabilities
Non-current liabilities
Total Liabilities
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Provision for contingencies (1)
Tax contingencies
11,536
7,003
313,165
614,882
324,701
621,885
Civil contingencies
1,173
7,702
124,411
142,305
125,584
150,007
Labor contingencies
1,512
367
174,035
155,501
175,547
155,868
Other
—
—
9,908
11,571
9,908
11,571
Provision for European
Commission investigation (2)
—
—
2,327
2,477
2,327
2,477
Total other provisions (3)
14,221
15,072
623,846
926,736
638,067
941,808
(1) Provisions for contingencies:
The tax contingencies correspond to litigation and tax criteria related to the tax treatment applicable to
direct and indirect taxes, which are found in both administrative and judicial stage.
The civil contingencies correspond to different demands of civil order filed against the Company.The labor
contingencies correspond to different demands of labor order filed against the Company.
Provisions are recognized in the consolidated income statement in administrative expenses or tax expenses,
as appropriate.
The Company maintains other judicial processes, individually and cumulatively , do not have a significant
impact on these financial statements
(2) Provision made for proceedings brought by the European Commission for possible breaches of free
competition in the freight market.
(3) Total other provision as of December 31, 2024, and December 31, 2023, include the fair value of the
contingencies arising at the time of the business combination with TAM S.A and subsidiaries,with a
probability of loss under 50%, which are not recognized in the normal course of IFRS Accounting
Standards application and which only in the context of a business combination should be recognized under
IFRS Accounting Standards.
72
› 328
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Movement of provisions:
Legal
claims (1)
European
Commission
Investigation
(1)
Total
ThUS$
ThUS$
ThUS$
Opening balance as January 1, 2023
940,140
2,397
942,537
Increase in provisions
449,406
—
449,406
Provision used
(70,844)
—
(70,844)
Difference by subsidiaries conversion
(69,563)
—
(69,563)
Reversal of provision
(310,118)
—
(310,118)
Exchange difference
310
80
390
Closing balance as of December 31, 2023
939,331
2,477
941,808
Opening balance as of January 1, 2024
939,331
2,477
941,808
Increase in provisions
448,338
—
448,338
Provision used
(92,729)
—
(92,729)
Difference by subsidiaries conversion
(143,057)
—
(143,057)
Reversal of provision
(508,907)
—
(508,907)
Exchange difference
(7,236)
(150)
(7,386)
Closing balance as of December 31, 2024
635,740
2,327
638,067
(1) See details of litigation and government investigations with a material impact in Note 30.
NOTE 21 - OTHER NON-FINANCIAL LIABILITIES
Current liabilities
Non-current liabilities
Total Liabilities
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Deferred revenue (1)(2)
3,118,099 3,044,664
140,244
348,936 3,258,343 3,393,600
Sales tax
14,566
17,801
—
—
14,566
17,801
Retentions
48,383
48,649
—
—
48,383
48,649
Other taxes
6,332
6,892
—
—
6,332
6,892
Dividends payable
293,092
174,549
—
—
293,092
174,549
Other sundry liabilities
8,208
9,351
—
—
8,208
9,351
Total other non-financial liabilities
3,488,680 3,301,906
140,244
348,936 3,628,924 3,650,842
Deferred Revenue Movement
Deferred revenue
Initial
balance
(1)
Recognition
Use
Loyalty
program
(Award and
redeem)
Expiration
of
tickets
Translation
Difference
Others
provisions
Final
balance
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
From January 1 to
December 31, 2023
2,953,289 14,238,959 (13,505,496)
17,680 (391,998)
84,988
(3,822) 3,393,600
From January 1 to
December 31, 2024
3,393,600 15,679,754 (15,073,167)
(126,564) (347,873) (260,364)
(7,043) 3,258,343
(1) The balance includes mainly, deferred revenue for services not provided as of December 31, 2024 and
December 31, 2023 and for the frequent flyer LATAM Pass program.
LATAM Pass is LATAM's frequent flyer program that allows rewarding the preference and loyalty of its
customers with multiple benefits and privileges, through the accumulation of miles or points that can be
exchanged for tickets or for a varied range of products and services. Clients accumulate miles or points
LATAM Pass every time they fly in LATAM and other airlines associated with the program, as well as
by buying in stores or use the services of a vast network of companies that have agreements with the
program around the world.
(2) As of December 31, 2024, Deferred Income includes Th US$35.615 (Th US$40.500 as of December 31,
2023) related to the compensation from Delta Air Lines, Inc., which is recognized in the income statement
based on the estimation of income differentials until until the end of the implementation of the strategic
alliance.
NOTE 22 - EMPLOYEE BENEFITS
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Retirements payments
71,296
57,785
Resignation payments
7,048
11,537
Other obligations
89,083
53,296
Total liability for employee benefits
167,427
122,618
(a)
The movement in retirements, resignations and other obligations:
Opening
balance
Increase
(decrease)
current service
provision
Benefits
paid
Actuarial
(gains)
losses
Currency
translation
Closing
balance
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
From January 1 to December 31, 2023
93,488
58,436
(6,701)
(21,198)
(1,407)
122,618
From January 1 to December 31, 2024
122,618
88,112
(10,778)
(21,769)
(10,756)
167,427
› 329
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
The main assumptions used in the calculation of the provision in Chile are presented below:
For the year ended December
31,
Assumptions
2024
2023
Discount rate
5.92 %
5.40 %
Expected rate of salary increase
3.00 %
3.00 %
Rate of turnover
2.96 %
5.02 %
Mortality rate
RV-2020
RV-2020
Inflation rate
3.42 %
2.99 %
Retirement age of women
60
60
Retirement age of men
65
65
The discount rate is based on the bonds issued by the Central Bank of Chile with a maturity of 20 years. The
RV-2020 mortality tables correspond to those established by the Commission for the Financial Market of Chile.
The inflation rates are based on the yield curves of the long term nominal and inflation adjusted bonds based on
BCU and BCPs issued by the Central Bank of Chile.
The calculation of the present value of the defined benefit obligation is sensitive to the variation of some
actuarial assumptions such as discount rate, salary increase, rotation and inflation.
The sensitivity analysis for these variables is presented below:
Effect on the liability
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Discount rate
Change in the accrued liability an closing for increase in 100 b.p.
(5,267)
(3,913)
Change in the accrued liability an closing for decrease of 100 b.p.
6,010
4,369
Rate of wage growth
Change in the accrued liability an closing for increase in 100 b.p.
5,570
4,133
Change in the accrued liability an closing for decrease of 100 b.p.
(5,056)
(3,811)
(b)
The liability for short-term:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Profit-sharing and bonuses (*)
183,153
114,769
(*)
Accounts payables to employees (Note 19 letter b)
The participation in profits and bonuses related to an annual incentive plan for achievement of certain
objectives.
(c)
CIP (Corporate Incentive Plan)
With the aim of incentivizing the retention of talent among the executives of the Company and in response to
the exit of the Chapter 11 Procedure, it was agreed to grant an extraordinary and exceptional incentive called
Corporate Incentive Plan (hereinafter also "CIP"), which will be enforceable and paid subject to compliance
with the terms, clauses and conditions approved at the Board meeting dated April 25, 2023. In summary, the
CIP contemplates three categories oriented to three different groups or categories of employees, whether they
are hired by the Company directly, or in other companies of the LATAM group. These categories are as
follows: Non-Executive Employees; Executives Not part of the Global Executive Meeting o “GEM”; and GEM
Executives. Employees in each of these groups are only eligible for the CIP that corresponds to their respective
category. The terms of each of these CIP categories were communicated to the respective employees between
the months of January to December 2023.
Below are more background on each of the different categories of the CIP. Additionally, in Note 33 describes in
more detail the main terms and conditions of the last two categories of the CIP (i.e., Non-GEM Executives; and
GEM Executives):
i)
Non-Executive Employees: The first subprogram was aimed at non-executive employees who, while
hired in LATAM as of December 31, 2020, were still in their position as of April 30, 2023, which
includes a fixed and guaranteed payment in cash on certain dates, depending on the country where the
employee is hired.
This subprogram is available to those employees who were unable to qualify for one of the two
categories below, or who were able to do so, chose not to participate in them.
ii)
Executives Not part of the GEM: The second subprogram applies to senior executives not part of the
GEM (Global Executive Meeting – Senior Managers, Managers, Assistant Managers). This program
contemplates the creation of remuneration synthetic Units (hereinafter, simply "Units") that, by
reference, are considered as equivalent to the price of one share of LATAM Airlines Group S.A., and
consequently, in case they become effective, they grant the worker the right to receive the payment in
cash that results from multiplying the number of Units that become effective by the value per share of
LATAM Airlines Group S.A. that should be considered in accordance with CIP.
In this context, this program contemplates two different bonuses: (1) a withholding bonus, consisting of
the amount in cash resulting from Units that are assigned to the respective employee, these Units being
paid at 20% at month 15 and 80% at month 24, in each case, counted from the exit date of Chapter 11
Procedure (i.e., November 3, 2022) (the "Exit Date"). This is consequently a guaranteed payment for
these employees; and (2) a bonus associated with the certain financial indicators of LATAM Airlines
Group S.A. and its subsidiaries, which is reflected in Note 19 (b), becoming effective 20% at month 15
and 80% at month 24, in each case, from the Exit Date. Consequently, this is an eventual payment that
is only made if these indicators are reached.
iii)
GEM Executives: The third subprogram applies to the Company´s GEM executives (Global Executive
Meeting) (CEO and employees whose job description is "vice presidents" or "directors"). This program,
in essence, contemplates the creation of remuneration synthetic Units that, by referential means, are
considered as equivalent to the price of one share of LATAM Airlines Group S.A. and consequently, in
case they become effective, they grant the worker the right to receive the payment in cash that results
from multiplying the number of Units that become effective by the value per share of LATAM Airlines
Group S.A. that must be considered according to the CIP.
These Units are divided into:
(1) Units associated with the employee's permanence in the Company ("RSUs" – Retention Shares
Units); and (2) Units associated with both the employee's permanence in the Company and the
performance of LATAM Airlines Group S.A. ("PSUs" – Performance Shares Units). This performance
is ultimately measured according to the share price of LATAM Airlines Group S.A. in the terms and
conditions of the CIP.
› 330
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Both the RSUs and the PSUs are consequently associated with the passage of time, becoming effective
by partialities according to the calendar contemplated by the CIP. For the case of RSUs, having a
vesting guaranteed by partialities as explained in more detail in Note 33. On the other hand, the PSUs
also consider the market value of the share of LATAM Airlines Group S.A. considering a liquid market.
However, as long as there is no such liquid market, the share price will be determined on the basis of
representative transactions. As explained in more detail in Note 33, PSUs constitute a contingent and
non-guaranteed payment.
In addition, some GEM Executives will also be entitled to receive a fixed and guaranteed cash payment
("MPP" – Management Protection Plan) on certain dates according to the CIP. Those employees who
are eligible for this MPP will also be eligible for a limited number of additional MSUs ("MPP Based
RSUs").
In all cases, the respective employees must have remained as such in the Company at the corresponding accrual
date to qualify for these benefits.
During the year of 2024 until the month of December, the amount accrued related to this CIP was MUS$78.78,
which is recorded in the "Administrative expenses" line of the Consolidated Statement of Income by Function.
As of December 2024, the amount of this plan recorded in the consolidated statement of financial position is
MUS$152.6.
(d)
Employment expenses are detailed below:
For the year ended December 31,
2024
2023
ThUS$
ThUS$
Salaries and wages
1,337,982
1,268,343
Short-term employee benefits
243,210
181,565
Other personnel expenses
157,282
133,429
Total
1,738,474
1,583,337
NOTE 23 - ACCOUNTS PAYABLE, NON-CURRENT
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Aircraft and engine maintenance
433,447
348,578
Fleet (JOL)
40,000
40,000
Airport and Overflight Taxes
—
11,337
Provision for vacations and bonuses
18,129
18,518
Other sundry liabilities
186
154
Total accounts payable, non-current
491,762
418,587
77
NOTE 24 - EQUITY
(a)
Capital
The Company’s objective is to maintain an appropriate level of capitalization that enables it to ensure access to
the financial markets for carrying out its medium and long-term objectives, optimizing the return for its
shareholders and maintaining a solid financial position.
The paid capital of the Company at December 31, 2024, amounts to ThUS$5,003,534 divided into
604,437,877,587 common stock of a same series (ThUS$5,003,534 divided into 604,437,877,587 shares as of
December 31, 2023), a single series nominative, ordinary character with no par value. The total number of
authorized shares of the Company as of December 31, 2024, corresponds to 604,441,789,335 shares. There are
no special series of shares and no privileges. The form of its stock certificates and their issuance, exchange,
disablement, loss, replacement and other similar circumstances, as well as the transfer of the shares, is governed
by the provisions of the Corporate Law and its regulations.
At the Company's Extraordinary Shareholders' Meeting held on April 20, 2023, it was agreed to:
i) A decrease in the Company's capital for an amount of ThUS$7,501,896, without altering the number and
characteristics of the shares into which it is divided, by absorbing the Company's accumulated losses as of
December 31, 2022 for the same amount;
ii) Others decrease of the Company's capital for an amount of ThUS$178, without altering the number and
characteristics of the shares into which it is divided, through the absorption of the equity account of "Treasury
Shares" as of December 31, 2022 for the same amount, produced on the occasion of the January 2013 reduction
of capital stock by operation of law that took place in accordance with the provisions of Article 27 of the
Corporations Law.
iii) Deduction of the Company´s capital the account "Costs of issuing shares and new convertible notes, for an
amount of ThUS$810,279.
On September 6, 2023, by public deed granted at the Notary of Santiago of Mr. Eduardo Diez Morello, under
repertoire number 15,327-2023 entitled "Declaración de Colocación y Vencimiento Plazo de Colocación Bonos
Convertibles "Series G", "Series H" and "Series I" and Reducción de Capital de Pleno Derecho", it was realized
that on September 5, 2023 the maturity of the placement term (the "Placement Term") of Convertible Notes
issued on the occasion of the capital increase agreed at the Company's Extraordinary Shareholders' Meeting
held on July 5, 2022. Consequently, in accordance with the mentioned in number Four of Clause Six of the
respective notes issuance contract (the "Issuance Agreement"), as of that date the amount placed against it
remained unchanged, and consequently the Convertible Notes not placed on that date were null and void. For
the sake of completeness, it was declared that upon maturity of the Placement Term, 123,605,720 Series G
Convertible Notes and 37 Series I Convertible Notes (collectively, the "Unplaced Convertible Notes") remained
unplaced, for an amount of US$123,605,720 and US$37, respectively (hereinafter, together, the "Unplaced
Amount"). The conversion option of the Unplaced Convertible Notes was backed by 1,965,903,665 shares as
equity.
Likewise, in the aforementioned deed it was realized that since all the Unplaced Convertible Bonds have been
terminated, since they have been null and void, they cannot be converted into shares of the issuer, consequently
reducing the Company's Capital Share by an amount equal to the Unplaced Amount.
Therefore, as of September 6, 2023, the amount of the Share Capital was reduced by law in the amount of
ThUS$123,606, equivalent to 1,965,903,665 shares. As a result of the foregoing, as of that date, the total
statutory share capital of the Company was reduced by law from the amount of ThUS$5,127,182, divided into
606,407,693,000 shares, of the same and unique series, without par value, to the amount of ThUS$5,003,576,
divided into 604,441,789,335 shares, of which MUS$5,003,534, equivalent to 604,437,877,587 shares, are fully
paid. To date, the balance of MUS$42, equivalent to 3,911,748 shares, are pending of subscription and payment
and are intended exclusively to respond to the conversion of 42,398 Series H Convertible Notes.
78
› 331
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
All of the above was explained in detail at the Extraordinary Shareholders' Meeting of the Company held on
April 25, 2024, in which it was agreed, among other things, (i) to record the aforementioned reduction by
operation of law in the Share Capital, and the granting of the aforementioned public deed dated September 6,
2023; and (ii) on the basis of the above, adapt the Fifth permanent and First Transitory articles of the corporate
statute, relating to share capital.
(b)
Movement of authorized shares
The following table shows the movement of the authorized, fully paid shares and back-up shares to be delivered
in the event that the respective conversion option is exercised under the convertible notes currently issued by the
Company:
As of December 31, 2024
As of December 31, 2023
N° of authorized
shares
N° of Subscribed
of shares and
paid or delivered
pursuant to the
exercise of the
conversion option
N° of
convertible
notes back-
up shares
pending to
place
N° of shares to
subscribe or not
used
N° of authorized
shares
N° of Subscribed
of shares and
paid or delivered
pursuant to the
exercise of the
conversion option
N° of
convertible
notes back-
up shares
pending to
place
N° of shares to
subscribe or not
used
Opening
Balance
604,441,789,335
604,437,877,587
3,911,748
—
606,407,693,000
604,437,584,048
4,205,287
1,965,903,665
Convertible
Notes H
—
—
—
—
—
293,539
(293,539)
—
Reduction of
full right (*)
—
—
—
—
(1,965,903,665)
—
—
(1,965,903,665)
Subtotal
—
—
—
—
(1,965,903,665)
293,539
(293,539)
(1,965,903,665)
Closing Balance
604,441,789,335
604,437,877,587
3,911,748
—
604,441,789,335
604,437,877,587
3,911,748
—
(*) See letter (a) above, in the same Note.
(c)
Share capital
The following table shows the movement of share capital:
Paid- in
Capital
ThUS$
Initial balance as of January 1, 2023
13,298,486
Placement during the conversion options period - Convertible Notes G (1)
17,401
Absorption of Accumulated Losses as of December 31, 2022 (2)
(7,501,896)
Absorption of treasury shares (2)
(178)
Deduction of issuance and placement costs of shares and bonds convertible into shares (2)
(810,279)
Subtotal
(8,294,952)
Ending balance as of December 31, 2023
5,003,534
Initial balance as of January 1, 2024
5,003,534
There were no movements during the year
—
Subtotal
—
Ending balance as of December 31, 2024
5,003,534
(1) Includes Convertible Notes bonds delivered as payment of debts recognized in Chapter 11.
(2) As explained in letter a) of this Note, at the Company's Extraordinary Shareholders' Meeting held on April
20, 2023, it was agreed to absorb retained losses and reduce the Company's capital.
(d)
Treasury stock
At December 31, 2024, the Company held no treasury stock. The remaining of ThUS$(178) corresponds to the
difference between the amount paid for the shares and their book value, at the time of the full right decrease of
the shares which held in its portfolio. As explained in letter a) of this same Note, at the Company's
Extraordinary Shareholders' Meeting held on April 20, 2023, an absorption of the Company's capital was agreed
for an amount of ThUS$178.
(e)
Other equity- Value of conversion right - Convertible Notes
(e.1)
Notes subscription
The Convertible Notes were issued to be place in exchange for a cash contribution, in exchange for settlement
of Chapter 11 Proceeding or a combination of both. Convertible Notes issued in exchange for cash were valued
at fair value (the cash received). Notes issued in exchange for settlement of Chapter 11 claims were valued
considering the discount that each group of liabilities settled on at the emergence date. The table below shows
the 3 Convertible Notes at their nominal values, the adjustment, if any, to arrive at their fair values and the
amount of transaction costs. The conversion option classified as equity is determined by deducting the amount
of the liability component from the fair value of the compound instrument as a whole. The equity portion is
recognized under Other equity at the time the Convertible Notes are issued.
As of December 31, 2023
Concepts
Convertible
Notes G
Convertible
Notes H
Convertible
Notes I
Total
Convertible
Notes
ThUS$
ThUS$
ThUS$
ThUS$
Face Value
17,401
—
—
17,401
Adjustment to fair value Convertible Notes at the
date of issue
(14,401)
—
—
(14,401)
Subtotal
(14,401)
—
—
(14,401)
Fair Value of Notes
3,000
—
—
3,000
Equity component at the date of issue
3,000
—
—
3,000
During the year ended December 31, 2024, there was no subscription of convertible bonds.
(e.2)
Conversion of notes into shares
As of December 31, 2023, the following notes have been converted into shares:
As of December 31, 2023
Concepts
Convertible
Notes G
Convertible
Notes H
Convertible
Notes I
Total
Convertible
Notes
ThUS$
ThUS$
ThUS$
ThUS$
Conversion percentage
100.000%
99.997%
100.000%
Conversion option of convertible notes exercised
1,133,397
1,372,798
6,863,427
9,369,622
Total Converted Notes
1,133,397
1,372,798
6,863,427
9,369,622
As of December 31, 2024, no bonds have been converted into shares.
The conversion option from the issuance of convertible notes classified as equity is determined by deducting the
amount of the liability component from the fair value of the compound instrument (i.e. convertible notes) as a
whole. This is recognized and included in equity, net of income tax effects, and is not subsequently remeasured.
In addition, the conversion option classified as equity will remain in equity until the conversion option is
exercised, in which case, the balance recognized in equity will be transferred to share capital. As of December
31, 2024, the portion not converted into equity corresponds to ThUS$39.
› 332
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(e.3)
The Convertible Notes
The contractual conditions of the G, H and I Convertible Notes consider the delivery of a fixed number of
shares of LATAM Airlines Group S.A. at the time of settlement of the conversion option of each of them. The
foregoing determined the classification of convertible notes as equity instruments, with the exception of Bond
H, which considers, in addition to the delivery of a fixed number of shares, the payment of 1% annual interest
with certain conditions for its payment and its accrual from 60 days after the exit Date. The payment of this
interest gives rise to the recognition of a liability component for the class H convertible notes.
At the date of issue, the fair value of the liability component in the amount of ThUS$102,031 was estimated
using the prevailing market interest rate for similar non-convertible instruments.
Transaction costs relating to the liability component are included in the carrying amount of the liability portion
and amortized over the period of the convertible notes using the effective interest method.
(f)
Reserve of share- based payments
Movement of Reserves of share- based payments:
Periods
Opening
balance
Stock
option
plan
Closing
balance
ThUS$
ThUS$
ThUS$
From January 1 to December 31, 2023
37,235
—
37,235
From January 1 to December 31, 2024
37,235
—
37,235
These reserves are related to share based payment plans that expired during the first quarter of 2023. No equity
instruments were issued and no amounts were paid associated with these plans.
(g)
Other sundry reserves
Movement of Other sundry reserves:
Periods
Opening
balance
Transactions
with
non-controlling
interest
Other
sundry
reserves
Others
increases
(Decreases)
Closing
balance
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
From January 1 to December 31,
2023
(1,972,651)
5,074
(14,401)
811,962 (1,170,016)
From January 1 to December 31,
2024
(1,170,016)
—
—
510 (1,169,506)
Balance of Other sundry reserves comprise the following:
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Higher value for TAM S.A. share exchange (1)
2,666,202
2,665,692
Reserve for the adjustment to the value of fixed assets (2)
2,620
2,620
Transactions with non-controlling interest (3)
(211,582)
(211,582)
Adjustment to the fair value of the New Convertible Notes (4)
(3,624,871)
(3,624,871)
Others
(1,875)
(1,875)
Total
(1,169,506)
(1,170,016)
(1)
Corresponds to the difference between the value of the shares of TAM S.A., acquired by Sister Holdco
S.A. (under the Subscriptions) and by Holdco II S.A. (by virtue of the Exchange Offer), which is recorded in the
declaration of completion of the merger by absorption, and the fair value of the shares exchanged by LATAM
Airlines Group S.A. as of June 22, 2012.
(2)
Corresponds to the technical revaluation of the fixed assets authorized by the Commission for the
Financial Market in the year 1979, in Circular No. 1529. The revaluation was optional and could be made only
once; the originated reserve is not distributable and can only be capitalized.
(3)
The balance corresponds to the loss generated by: Lan Pax Group S.A. e Inversiones Lan S.A. in the
acquisition of shares of Aerovías de Integración Regional S.A. for ThUS$(3,480) and ThUS$(20), respectively;
the acquisition of TAM S.A. of the minority interest in Aerolinhas Brasileiras S.A. for ThUS$(885), the
acquisition of Inversiones Lan S.A. of the minority participation in Aerovías de Integración Regional S.A. for
an amount of ThUS$(2) and the acquisition of a minority stake in Aerolane S.A. by Lan Pax Group S.A. for an
amount of ThUS$(21,526) through Holdco Ecuador S.A. The loss due to the acquisition of the minority interest
of Multiplus S.A. for ThUS$(184,135), and the acquisition of a minority interest in LATAM Airlines Perú S.A.
through LATAM Airlines Group S.A for an amount of ThUS$(3,225) and acquisition of the minority stake in
LAN Argentina S.A. and Inversora Cordillera through Transportes Aéreos del Mercosur S.A. for an amount of
ThUS$(3,383). The movements during 2023 was the following: acquisition of the non-controlling interest of
Aerovías de Integración Regional S.A. for an amount of ThUS$(23) and amendment of articles in the legal
statutes of association related to premiums for the issuance of shares in the subsidiaries Aerovías de Integración
Regional S.A. for a total amount of ThUS$5.097.
(4)
The adjustment to the fair value of the Convertible Notes delivered in exchange for settlement of
Chapter 11 claims was valued considering the discount that each group of liabilities settled on at the emergence
date. These relate to: gain on the haircut for the accounts payable and other accounts payable for
ThUS$2,564,707, gain on the haircut for the financial liabilities for ThUS$420,436,and gain on the haircut of
lease liabilities which is booked against the right of use asset for ThUS$639,728 as of December 31, 2024 and
December 31, 2023.
8
› 333
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(h)
Reserves with effect in other comprehensive income.
Movement of Reserves with effect in other comprehensive income:
Currency
translation
reserve
Cash flow
hedging
reserve
Gains (Losses)
on change on
value
of time value
of options
Actuarial gain
or loss on
defined benefit
plans reserve
Total
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Opening balance as of January 1, 2023
(3,805,560)
36,542
(21,622)
(28,117) (3,818,757)
Change in fair value of hedging instrument
recognized in OCI
—
(32,858)
25,734
—
(7,124)
Add: Costs of hedging deferred and recognized in
OCI
—
—
—
—
—
Reclassified from OCI to profit or loss
—
(26,568)
28,818
—
2,250
Reclassified from OCI to the value of the hedged
asset
—
(11,112)
—
—
(11,112)
Deferred tax
—
3,604
—
—
3,604
Actuarial reserves by employee benefit plans
—
—
—
(21,192)
(21,192)
Deferred tax actuarial IAS by employee benefit plans
—
—
—
750
750
Translation difference subsidiaries
(25,051)
(8,286)
17
—
(33,320)
Closing balance as of December 31, 2023
(3,830,611)
(38,678)
32,947
(48,559) (3,884,901)
Opening balance as of January 1, 2024
(3,830,611)
(38,678)
32,947
(48,559) (3,884,901)
Change in fair value of hedging instrument
recognized in OCI
—
15,476
(34,872)
—
(19,396)
Reclassified from OCI to profit or loss
—
(40,898)
22,685
—
(18,213)
Reclassified from OCI to the value of the hedged
asset
—
11,999
14,580
—
26,579
Actuarial reserves by employee benefit plans
—
—
—
(21,763)
(21,763)
Deferred tax actuarial IAS by employee benefit plans
—
—
—
908
908
Translation difference subsidiaries
(379,049)
(795)
304
—
(379,540)
Closing balance as of December 31, 2024
(4,209,660)
(52,896)
35,644
(69,414) (4,296,326)
(h.1)
Cumulative translate difference
These are originated from exchange differences arising from the translation of any investment in foreign entities
(or Chilean investments with a functional currency different to that of the parent company), and from loans and
other instruments in foreign currency designated as hedges for such investments. When the investment (all or
part) is sold or disposed and a loss of control occurs, these reserves are shown in the consolidated statement of
income as part of the loss or gain on the sale or disposal. If the sale does not involve loss of control, these
reserves are transferred to non-controlling interests.
(h.2) Cash flow hedging reserve
These are originated from the fair value valuation at the end of each period of the outstanding derivative
contracts that have been defined as cash flow hedges. When these contracts expire, these reserves should be
adjusted, and the corresponding results recognized.
(h.3)
Reserves of actuarial gains or losses on defined benefit plans
Correspond to the increase or decrease in the present value obligation for defined benefit plans due to changes
in actuarial assumptions, and experience adjustments, which are the effects of differences between the previous
actuarial assumptions and the actual events that have occurred.
(i)
Retained earnings/(losses)
Movement of Retained earnings/(losses):
Periods
Opening
balance
Result
for the
period
Dividends
Others
increase
(decreases) (1)
Closing
balance
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
From January 1 to December 31,
2023
(7,501,896)
581,831 (174,549)
7,559,025
464,411
From January 1 to December 31,
2024
464,411
976,972 (293,092) (*)
—
1,148,291
(*) It corresponds to mandatory minimum dividend provision charged to equity related to the net income for the
year 2024. The minimum dividend proposal for the 2024 financial year it must be approved by the Board of
Directors when appropriate in accordance with the applicable regulations.
(1) The detail of Other increases (decreases) is as follows:
As of
December 31,
2023
ThUS$
Absorption accumulated losses (*)
7,501,896
Reversal of dividends
57,129
Total
7,559,025
(*) See letter a) under this same Note.
(j)
Dividends per share
Description of dividend
Minimum mandatory
dividend 2024
Minimum mandatory
dividend 2023
Amount of the dividend (ThUS$)
293,092 (*)
174,549 (**)
Number of shares among which the dividend is distributed
604,437,877,587
604,437,877,587
Dividend per share (US$)
0.000485
0.000289
(*) It corresponds to mandatory minimum dividend provision charged to equity related to the net income for the
year 2024. The minimum dividend proposal for the 2024 financial year it must be approved by the Board of
Directors when appropriate in accordance with the applicable regulations.
(**) In the Ordinary Shareholders' Meeting held on April 25, 2024,it was agreed to distribute a final dividend
proposed by the Board of Directors in the Ordinary Session of April 3, 2024, amounting to ThUS$174,549,
which corresponds to 30% of the net income for the year 2023. The payment was made on May 16, 2024.
› 334
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 25 - REVENUE
The detail of revenues is as follows:
For the year ended December 31,
2024
2023
ThUS$
ThUS$
Passengers
11,233,287
10,215,148
Cargo
1,599,756
1,425,393
Total
12,833,043
11,640,541
NOTE 26 - COSTS AND EXPENSES BY NATURE
(a)
Costs and operating expenses
The main operating costs and administrative expenses are detailed below:
For the year ended December 31,
2024
2023
ThUS$
ThUS$
Aircraft fuel
(3,970,077)
(3,947,220)
Other rentals and landing fees
(1,470,057)
(1,322,795)
Aircraft maintenance
(815,916)
(601,804)
Aircraft rental (*)
(4,164)
(91,876)
Commissions
(230,127)
(244,160)
Passenger services
(331,918)
(271,838)
Other operating expenses
(1,448,052)
(1,351,571)
Total
(8,270,311)
(7,831,264)
(*) Aircraft Lease Contracts include lease payments based on Power by the Hour (PBH) at the beginning of the
contract and fixed-rent payments later on. For these contracts that contain an initial period based on PBH and
then a fixed amount, a right of use asset and a lease liability was recognized at the date of modification of the
contract. These amounts continue to be amortized over the contract term on a straight-line basis starting from
the modification date of the contract. Therefore, as a result of the application of the lease accounting policy, the
expenses for the year include both the lease expense for variable payments (Aircraft Rentals) as well as the
expenses resulting from the amortization of the right of use assets (included in the Depreciation line included in
b) below) and interest from the lease liability (included in Lease Liabilities letter c) below)
For the year ended December
31,
2024
2023
ThUS$
ThUS$
Payments for leases of low-value assets
(18,555)
(16,632)
Total
(18,555)
(16,632)
(b)
Depreciation and amortization
Depreciation and amortization are detailed below:
For the year ended December
31,
2024
2023
ThUS$
ThUS$
Depreciation (*)
(1,375,101)
(1,151,015)
Amortization
(72,555)
(54,358)
Total
(1,447,656)
(1,205,373)
(*) Included within this amount is the depreciation of the Property, plant and equipment (See Note 16 (a)) and
the maintenance of the aircraft recognized as right of use assets. The maintenance cost amount included in the
depreciation line for the year ended December 31, 2024 is ThUS$668,936 (ThUS$565,384 for the same year in
2023).
(c)
Financial costs
The detail of financial costs is as follows:
For the year ended December
31,
2024
2023
ThUS$
ThUS$
Bank loan interests
(452,778)
(400,052)
Financial leases
(49,809)
(58,011)
Lease liabilities
(318,267)
(224,824)
Other financial expenses
(61,096)
(15,344)
Total
(881,950)
(698,231)
Costs and expenses by nature presented in this note plus the Employee expenses disclosed in Note 22, are
equivalent to the sum of cost of sales, distribution costs, administrative expenses, other expenses and financing
costs presented in the consolidated statement of income by function.
› 335
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 27 - OTHER INCOME, BY FUNCTION
Other income, by function is as follows:
For the year ended December
31,
2024
2023
ThUS$
ThUS$
Tours
60,437
36,297
Customs and warehousing
37,710
27,553
Maintenance
5,632
7,784
Income from non-airlines products LATAM Pass (*)
35,904
15,148
Other miscellaneous income
60,986
61,859
Total
200,669
148,641
(*) During the twelve months period ended December 31, 2024, the Company reclassified income from non-
airline redemption products Latam Pass from revenue to other income. Prior year comparative amounts for the
twelve months period ended December 31, 2023 ,which totaled approximately US$4.7 million, were not material
and as a result were not revised to conform to the current year presentation.
NOTE 28 - FOREIGN CURRENCY AND EXCHANGE RATE DIFFERENCES
The functional currency of LATAM Airlines Group S.A. is the US dollar, LATAM has subsidiaries whose
functional currency is different to the US dollar, such as the chilean peso, argentine peso, colombian peso,
brazilian real and guaraní.
The functional currency is defined as the currency of the primary economic environment in which an entity
operates. For each entity and all other currencies are defined as a foreign currency.
Considering the above, the balances by currency mentioned in this note correspond to the sum of foreign
currency of each of the entities that are part of the LATAM Airlines Group S.A. and Subsidiaries.
Following are the current exchange rates for the US dollar, on the dates indicated:
As of
December 31,
As of
December 31,
As of
December 31,
2024
2023
2022
Argentine peso
1,030.50
807.98
177.12
Brazilian real
6.18
4.85
5.29
Chilean peso
996.46
877.12
855.86
Colombian peso
4,403.50
3,872.49
4,845.35
Euro
0.96
0.90
0.93
Australian dollar
1.61
1.46
1.47
Boliviano
6.86
6.86
6.86
Mexican peso
20.54
16.91
19.50
New Zealand dollar
1.77
1.58
1.58
Peruvian Sol
3.80
3.70
3.81
Paraguayan Guarani
7,815.0
7,270.6
7,332.20
Uruguayan peso
43.80
38.81
39.71
87
Foreign currency
The foreign currency detail of balances of monetary items in current and non-current assets is as follows:
Cash and cash equivalents
630,133
386,216
Argentine peso
4,184
1,808
Brazilian real
4,529
7,108
Chilean peso
17,440
47,907
Colombian peso
12,156
8,968
Euro
15,721
25,329
U.S. dollar
532,670
237,251
Other currency
43,433
57,845
Other financial assets, current
7,768
14,659
Chilean peso
2,130
4,367
Euro
67
3,722
U.S. dollar
5,086
5,971
Other currency
485
599
Other non - financial assets, current
58,675
36,654
Chilean peso
29,968
12,354
Euro
4,105
5,310
U.S. dollar
2,542
10,735
Other currency
22,060
8,255
Trade and other accounts receivable, current
214,599
279,586
Argentine peso
8,729
12,831
Chilean peso
64,915
69,588
Colombian peso
1,562
1,453
Euro
96,438
90,699
U.S. dollar
7,503
68,893
Other currency
35,452
36,122
Accounts receivable from related entities, current
24
27
Chilean peso
24
27
Tax current assets
13,121
17,258
Chilean peso
2,035
2,202
Colombian peso
7,020
6,084
Peruvian sun
1,909
7,108
Other currency
2,157
1,864
Current assets
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
88
› 336
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Total current assets
924,320
734,400
Argentine peso
12,913
14,639
Brazilian real
4,529
7,108
Chilean peso
116,512
136,445
Colombian peso
20,738
16,505
Euro
116,331
125,060
U.S. Dollar
547,801
322,850
Other currency
105,496
111,793
Current assets
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
Non-current assets
Other financial assets, non-current
13,627
15,375
Brazilian real
2,989
3,807
Chilean peso
876
2,073
Euro
4,579
4,252
U.S. dollar
2,315
2,071
Other currency
2,868
3,172
Other non - financial assets, non-current
5,127
9,856
Brazilian real
5,058
9,789
Other currency
69
67
Accounts receivable, non-current
4,126
4,732
Chilean peso
4,126
4,732
Deferred tax assets
5,147
1,048
Colombian peso
5,112
859
U.S. dollar
—
144
Other currency
35
45
Total non-current assets
28,027
31,011
Brazilian real
8,047
13,596
Chilean peso
5,002
6,805
Colombian peso
5,112
1,700
Euro
4,579
4,252
U.S. dollar
2,315
2,230
Other currency
2,972
2,428
The foreign currency detail of balances of monetary items in current liabilities and non-current is as follows:
Up to 90 days
91 days to 1 year
As of
December 31,
2024
As of
December 31,
2023
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
ThUS$
ThUS$
Current liabilities
Other financial liabilities, current
30,413
4,331
872
1,010
Chilean peso
1,621
1,364
747
702
Euro
26,191
—
6
—
U.S. dollar
2,131
2,510
—
—
Other currency
470
457
119
308
Trade and other accounts payables, current
817,925
616,032
8,639
9,583
Argentine peso
5,203
2,074
133
132
Brazilian real
13,237
13,401
765
922
Chilean peso
175,057
128,838
1,556
1,560
Euro
48,804
54,744
7
7
U.S. dollar
513,970
350,635
1,773
1,797
Peruvian sol
45,244
42,347
4,301
4,994
Mexican peso
1,890
2,019
—
—
Pound sterling
4,811
17,379
18
11
Uruguayan peso
1,253
706
5
39
Other currency
8,456
3,889
81
121
Accounts payable to related entities, current
7,520
5,154
—
—
U.S. dollar
7,520
5,154
—
—
Other provisions, current
10
16
14,161
12,429
Chilean peso
—
—
4
4
Other currency
10
16
14,157
12,425
Current liabilities
Other non-financial liabilities, current
11,031
15,634
5,330
6,099
Argentine peso
1,286
836
478
445
Chilean peso
3,916
4,338
2,688
4,026
Colombian peso
1,122
1,456
1,187
1,066
U.S. dollar
3,185
7,305
758
416
Other currency
1,522
1,699
219
146
Total current liabilities
866,899
641,167
29,002
29,121
Argentine peso
6,489
2,910
611
577
Brazilian real
13,237
13,401
765
922
Chilean peso
180,594
134,540
4,995
6,292
Colombian peso
1,122
1,456
1,187
1,066
Euro
74,995
54,744
13
7
U.S. dollar
526,806
365,604
2,531
2,213
Other currency
63,656
68,512
18,900
18,044
› 337
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
More than 1 to 3 years
More than 3 to 5 years
More than 5 years
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
As of
December
31, 2024
As of
December
31, 2023
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Non-current liabilities
Other financial liabilities,
non-current
90,248
32,867
2,791
2,871
167,538
165,511
Chilean peso
33,318
17,020
2,749
2,500
166,495
164,942
Euro
43,861
—
42
—
1,043
—
U.S. dollar
12,217
14,110
—
—
—
—
Other currency
852
1,737
—
371
—
569
Accounts payable, non-
current
22,407
72,783
—
—
—
—
Chilean peso
16,477
16,774
—
—
—
—
U.S. dollar
4,397
54,441
—
—
—
—
Other currency
1,533
1,568
—
—
—
—
Other provisions, non-
current
44,993
49,427
—
—
—
—
Argentine peso
2,685
3,570
—
—
—
—
Brazilian real
37,227
42,244
—
—
—
—
Chilean peso
1,996
—
—
—
—
—
Colombian peso
330
395
—
—
—
—
Euro
2,653
3,053
—
—
—
—
U.S. dollar
102
165
—
—
—
—
Provisions for employees
benefits, non-current
89,950
79,749
—
—
—
—
Chilean peso
82,804
76,247
—
—
—
—
U.S. dollar
7,146
3,502
—
—
—
—
Total non-current liabilities
247,598
234,826
2,791
2,871
167,538
165,511
Argentine peso
2,685
3,570
—
—
—
—
Brazilian real
37,227
42,244
—
—
—
—
Chilean peso
134,595
110,041
2,749
2,500
166,495
164,942
Colombian peso
330
395
—
—
—
—
Euro
46,514
3,053
42
—
1,043
—
U.S. dollar
23,862
72,218
—
—
—
—
Other currency
2,385
3,305
—
371
—
569
As of
December 31,
2024
As of
December 31,
2023
ThUS$
ThUS$
General summary of foreign currency:
Total assets
952,347
765,411
Argentine peso
12,913
14,639
Brazilian real
12,576
20,704
Chilean peso
121,514
143,250
Colombian peso
25,850
18,205
Euro
120,910
129,312
U.S. dollar
550,116
325,080
Other currency
108,468
114,221
Total liabilities
1,313,828
1,073,496
Argentine peso
9,785
7,057
Brazilian real
51,229
56,567
Chilean peso
489,428
418,315
Colombian peso
2,639
2,917
Euro
122,607
57,804
U.S. dollar
553,199
440,035
Other currency
84,941
90,801
Net position
Argentine peso
3,128
7,582
Brazilian real
(38,653)
(35,863)
Chilean peso
(367,914)
(275,065)
Colombian peso
23,211
15,288
Euro
(1,697)
71,508
U.S. dollar
(3,083)
(114,955)
Other currency
23,527
23,420
› 338
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 29 – EARNINGS PER SHARE
For the year ended December 31,
2024
2023
Basic earnings per share
Income attributable to owners of the parent company
(ThUS$)
976,972
581,831
Weighted average number of shares, basic (*)
604,437,877,587
604,437,869,545
Basic earnings per share (US$)
0.001616
0.000963
For the year ended December 31,
2024
2023
Diluted earnings per share
Income attributable to owners of the parent company
(ThUS$)
976,972
581,831
Weighted average number of shares, diluted (**)
604,441,789,335
604,441,789,335
Diluted earnings per share (US$)
0.001616
0.000963
(*) As of December 31, 2024, the weighted average number of shares considers 604,437,877,587 shares outstanding
from January 1, 2024 to December 31, 2024. As of December 31, 2023, the number of weighted basic shares
considers 604.437.584.048 outstanding shares from January 1, 2023 to December 31, 2023. From January 10 to
December 31, 2023, the number of shares outstanding increased due to the partial conversion of the Convertible
Note H.
(**) As of December 31, 2024, the number of weighted diluted shares considers 604,437,877,587 shares outstanding
and 3,911,748 shares outstanding from January 1, 2024 until December 31, 2024, assuming the full conversion
of the Convertibles Notes that were issued on the date of exit from Chapter 11. As of December 31, 2023, the
number of weighted diluted shares considers 604,437,877,587 shares from January 1, 2023 to December 31,
2023, and 3,911,748 shares outstanding from January 1 to December 31, 2023, assuming the full conversion of
the convertible bonds that were issued on the date of exit from Chapter 11.
93
NOTE 30 – CONTINGENCIES
I.
Lawsuits
LATAM
Airlines
Group S.A. y
Lan
Cargo
S.A.
Comisión
Europea
—
Investigation
of
alleged
infringements
to
free
competition
of
cargo
airlines,
especially
fuel
surcharge.
On
December
26th, 2007, the General
Directorate for Competition
of the European Commission
notified Lan Cargo S.A. and
LATAM
Airlines
Group
S.A. the instruction process
against twenty five cargo
airlines,
including
Lan
Cargo
S.A.,
for
alleged
breaches of competition in
the air cargo market in
Europe,
especially
the
alleged fixed fuel surcharge
and freight.
On April 14th, 2008, the notification of the European Commission was replied.
The appeal was filed on January 24, 2011.
On May 11, 2015, we attended a hearing at which we petitioned for the vacation of
the Decision based on discrepancies in the Decision between the operating section,
which mentions four infringements (depending on the routes involved) but refers
to Lan in only one of those four routes; and the ruling section (which mentions one
single conjoint infraction).
On November 9th, 2010, the General Directorate for Competition of the European
Commission notified Lan Cargo S.A. and LATAM Airlines Group S.A. the
imposition of a fine in the amount of ThUS$8,562 (€8.220.000 Euros)
This fine is being appealed by Lan Cargo S.A. and LATAM Airlines Group S.A.
On December 16, 2015, the European Court of Justice revoked the Commission’s
decision because of discrepancies. The European Commission did not appeal the
decision, but presented a new one on March 17, 2017 reiterating the imposition of
the same fine on the eleven original airlines. The fine totals €776,465,000 Euros.
It imposed the same fine as before on Lan Cargo and its parent, LATAM Airlines
Group S.A., totaling €8.2 million Euros. On May 31, 2017 Lan Cargo S.A. and
LATAM Airlines Group S.A. filed a petition with the General Court of the
European Union seeking vacation of this decision. We presented our defense in
December 2017. On July 12, 2019, we attended a hearing before the European
Court of Justice to confirm our petition for vacation of judgment or otherwise, a
reduction in the amount of the fine. On March 30, 2022, the European Court
issued its ruling and lowered the amount of our fine from ThUS$8,562
(€8,220,000 Euros) to ThUS$2,327 (€2,240,000 Euros). This ruling was appealed
by LAN Cargo S.A. and LATAM on June 9, 2022. The other eleven airlines also
appealed the ruling affecting them. The European Commission responded to our
appeal of September 7, 2022. Lan Cargo S.A. and LATAM answered the
Commission’s arguments on November 11, 2022. Finally, the European
Commission replied to our defense in January 2023. On February 13, 2023, LAN
Cargo, S.A. and LATAM requested the European Court to hold an oral hearing to
ensure the Court's full understanding of some points of the discussion. The
European Court held a hearing on April 10, 2024. We are currently awaiting a
decision. On September 5, 2024, the Advocate General of the European Court of
Justice issued a non-binding opinion affirming that the European Court should
dismiss all the appeals of the airlines and maintain the fines imposed. The
European Court usually follows the majority of the Advocate General’s
recommendations, so it is highly likely that the final decision will confirm the
fines, in our case, 2,240,000 euros.
2,327
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 339
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Lan
Cargo
S.A.
y
LATAM
Airlines
Group S.A.
In the Ovre
Romerike
Disrtict
Court
(Norway)
and
Directie
Juridische
Zaken
Afdeling
Ceveil
Recht
(Netherlan
ds)
—
Lawsuits
filed
against
European airlines by users
of
freight
services
in
private lawsuits as a result
of the investigation into
alleged
breaches
of
competition
of
cargo
airlines,
especially
fuel
surcharge. Lan Cargo S.A.
and
LATAM
Airlines
Group S.A., have been
sued in court proceedings
directly and/or in third
party, based in England,
Norway, the Netherlands
and Germany, these claims
were filed in England,
Norway, the Netherlands
and Germany, but are only
ongoing in Norway and
the Netherlands.
The two cases still pending, in Norway and the Netherlands, are in the
evidence confirmation stage. The Norway case has been inactive since
January 2014 (pending the final decision of the European Commission), but
there has been judicial activity in the Netherlands case. In the Netherlands,
most of the airlines involved in this case have been forced to withdraw their
claim against LATAM and Lan Cargo after their previous claims in the
Chapter 11 proceedings before the New York Court were dismissed. So,
Lufthansa, Lufthansa Cargo, British Airways, Air France, KLM, Martinair
and Singapore have withdrawn their claims and now only the Thai Airways
claim is still ongoing against LATAM and Lan Cargo. Only the withdrawal
of KLM’s claim has been notified in the case of Norway.
—
Aerolinhas
Brasileiras
S.A.
Justicia
Federal.
0008285-5
3.2015.40
3.6105
An action seeking to quash
a decision and petitioning
for early protection in
order
to
obtain
a
revocation of the penalty
imposed by the Brazilian
Competition
Authority
(CADE)
in
the
investigation
of
cargo
airlines alleged fair trade
violations, in particular the
fuel surcharge.
This action was filed by presenting a guaranty – policy – in order to suspend
the effects of the CADE’s decision regarding the payment of the following
fines: (i) ABSA: ThUS$10,438; (ii) Norberto Jochmann: ThUS$201; (iii)
Hernan Merino: ThUS$ 102; (iv) Felipe Meyer:ThUS$ 102. The action also
deals with the affirmative obligation required by the CADE consisting of the
duty to publish the condemnation in a widely circulating newspaper. This
obligation had also been stayed by the court of federal justice in this
process. Awaiting CADE’s statement. ABSA began a judicial review in
search of an additional reduction in the fine amount. In December 2018, the
Justice Federal ruled negatively against ABSA, indicating that it will not
apply a additional reduction to the fine imposed. The Judge’s decision was
published on March 12, 2019, and we filed an appeal against it on March 13,
2019
9,132
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 340
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Aerolinhas
Brasileiras
S.A.
Justicia
Federal.
0001872-5
8.2014.4.0
3.6105
A lawsuit filed by ABSA
with
a
motion
for
preliminary
injunction,
was filed on February 28,
2014, in order to cancel
tax
debts
of
PIS,
CONFINS, IPI and II,
connected
with
the
administrative
process
10831.005704/2006-43
The statement was authenticated on January 29, 2016. A new insurance
policy was submitted on March 30, 2016 with the change to the guarantee
requested by PGFN. On 05/20/2016 the process was sent to PGFN, which
was manifested on 06/03/2016. The Decision denied the company's request
in the lawsuit. The court (TRF3) made a decision to eliminate part of the
debt and keep the other part (already owed by the Company, but which it has
to pay only at the end of the process: ThUS$3.216 – R$19.877.623,21-
probable y ThUS$7.234 – R$44.706.265,59- possible). We must await a
decision on the Treasury appeal.
10,450
Tam Linhas
Aéreas S.A.
Tribunal
Regional
Federal da
2a Região.
2001.51.0
1.012530-
0 (linked
to this
process
Pas
19515.721
154/2014-
71,
19515.002
963/2009-
12)
Ordinary judicial action
filed by TAM Linhas
Aéreas for the purpose of
declaring the nonexistence
of
legal
relationship
obligating the company to
collect the Air Fund.
Unfavorable court decision in first instance. Currently expecting the ruling
on the appeal filed by the company. In order to suspend chargeability of Tax
Credit a Guaranty Deposit to the Court was delivered for R$ 260.223.373,10-
original amount in 2012/2013, which currently equals ThUS$87,082
(R$538,168,490.91). The court decision requesting that the Expert make all
clarifications requested by the parties in a period of 30 days was published
on March 29, 2016. The plaintiffs’ submitted a petition on June 21, 2016
requesting acceptance of the opinion of their consultant and an urgent ruling
on the dispute. In September 2022 with a decision for the parties, they will
rule on more evidence and then we will have to wait for a resolution. No
amount additional to the deposit that has already been made is required if
this case is lost. A ruling is currently pending on the company’s appeal.
68,949
Tam Linhas
Aéreas S.A.
Secretaria
da Receita
Federal do
Brasil.
10880.725
950/2011-
05
A claim filed by the tax
authorities questioning the
offsetting of credits from
the
Social
Integration
Program
(PIS
in
Portuguese)
and
Social
Security
Financing
Contribution (COFINS in
Portuguese) declared in
the Offsetting Declarations
(DCOMPs in Portuguese).
The objection (manifestação de inconformidade) filed by the company was
rejected, which is why the voluntary appeal was filed. The case was
assigned to the 1st Ordinary Group of Brazil’s Administrative Council of
Tax Appeals (CARF) on June 8, 2015. TAM’s appeal was included in the
CARF session held August 25, 2016. An agreement that converted the
proceedings into a formal case was published on October 7, 2016. The
company has received the results of the due diligence and presented a claim.
On August 21, 2024, a decision was rendered in the Remedy of Appeal
adverse to LATAM Airlines Brazil. We need to wait for service of the
decision to evaluate the next steps to take.
30,360
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 341
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
10 ª Vara
das
Execuções
Fiscais
Federais
de
São
Paulo
0061196-6
8.2016.4.0
3.6182
Tax Enforcement Lien No.
0020869-47.2017.4.03.618
2 on Profit-Based Social
Contributions from 2004
to 2007.
This tax enforcement was referred to the 10th Federal Jurisdiction on
February 16, 2017. A petition reporting our request to submit collateral was
recorded on April 18, 2017. At this time, the period is pending for the
plaintiff to respond to our petition. The bond was replaced. Currently, the
evidentiary stage has begun.
28,425
TAM Linhas
Aéreas S.A.
Secretaría
de Receita
Federal
5002912.2
9.2019.4.0
3.6100
A lawsuit filed by TAM
disputing the debit in the
administrative proceeding
16643.000085/2009-47,
reported in previous notes,
consisting of a notice
demanding recovery of the
Income
and
Social
Assessment Tax on the net
profit
(SCL)
resulting
from the itemization of
royalties and use of the
TAM trademark
The lawsuit was assigned on February 28, 2019. A decision was rendered on
March 1, 2019 stating that no guarantee was required. On 04/06/2020 TAM
Linhas Aéreas S.A. had a favorable decision (sentence). The National
Treasury can appeal. Today, we await the final decision.
8,454
TAM Linhas
Aéreas S.A.
Delegacía
de Receita
Federal
10611.720
852/2016-
58
An improper charge of the
Contribution
for
the
Financing
of
Social
Security (COFINS) on an
import
There is no predictable decision date because it depends on the court of the
government agency. On June 29, 2023, the company decided to propose a
composition to the National Treasurer on payment of the debt, but with the
legal deductions stipulated in Law 246/2022. the debt is paid. We are
awaiting a response from the authority.
12,847
TAM Linhas
Aéreas S.A.
Delegacía
de Receita
Federal
16692.721
.933/2017-
80
The
Internal
Revenue
Service of Brazil issued a
notice of violation because
TAM applied for credits
offsetting the contributions
for the Social Integration
Program (PIS) and the
Social Security Funding
Contribution
(COFINS)
that do not bear a direct
relationship to air transport
(Referring to 2012).
An administrative defense was presented on May 29, 2018, which was
partially in favor of the company. We filed an appeal and it was decided that
the process will become a due diligence. We are awaiting the due diligence.
25,727
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 342
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
União
Federal
2001.51.0
1.020420-
0
TAM and other airlines
filed a recourse claim
seeking a finding that
there is no legal or tax
basis to be released from
collecting the Additional
Airport Fee (“ATAERO”).
In 2001, the Company filed a court claim and in 2009, an initial decision was
rendered partially in favor of the Company. In 2016, the Court dismissed the
appeal by the plaintiffs. We filed new appeals before the STJ (Superior Court
of Justice of Brazil) and STF (Supreme Federal Court of Brazil). Those
appeals (special and extraordinary) were denied, so we filed another appeal,
called Internal Appeal, on which a decision is pending. A decision by the
superior court is pending. The amount is indeterminate because even though
TAM is the plaintiff, if the ruling is against it, it could be ordered to pay a
fee.
—
TAM Linhas
Aéreas S.A.
Receita
Federal do
Brasil
19515-720
.823/2018-
11
An administrative claim
against TAM to collect
alleged differences in SAT
payments for the periods
11/2013 to 12/2017.
A defense was presented on November 28, 2018. The Court dismissed the
Company’s appeal in August 2019. The Company filed an Appeal to the
Appellate Branch of the Internal Revenue Administrative Court (CARF in
Portuguese) on September 17, 2019, that is pending a decision.
104,846
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.938
832/2013-
19
The decision denied the
reallocation petition and
did not equate the Social
Security Tax (COFINS)
credit declarations for the
second quarter of 2011,
which were determined to
be in the non-cumulative
system (proportionality of
the
PIS
and
COFINS
credits)
An administrative defense was argued on March 19, 2019. The Court
dismissed the Company’s defense in December 2020. The Company filed an
Appeal to the Appellate Branch of the Internal Revenue Administrative
Court (CARF in Portuguese) that is pending a decision.
18,594
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.938
834/2013-
16
The decision denied the
reallocation petition and
did not equate the Social
Security Tax (COFINS)
credit declarations for the
third quarter of 2011,
which were determined to
be in the non-cumulative
system. (proportionality of
the
PIS
and
COFINS
credits)
An administrative defense was argued on March 19, 2019. The Court
dismissed the Company’s defense in December 2020. The Company filed an
Appeal to the Appellate Branch of the Internal Revenue Administrative
Court (CARF in Portuguese) that is pending a decision
13,770
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 343
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.938
837/2013-
41
The decision denied the
reallocation petition and
did not equate the Social
Security Tax (COFINS)
credit declarations for the
fourth quarter of 2011,
which were determined to
be in the non-cumulative
system. (proportionality of
the
PIS
and
COFINS
credits)
An administrative defense was argued on March 19, 2019. The Court
dismissed the Company’s defense in December 2020. The Company filed an
Appeal to the Appellate Branch of the Internal Revenue Administrative
Court (CARF in Portuguese) that is pending a decision
17,982
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.938
838/2013-
96
The decision denied the
reallocation petition and
did not equate the Social
Security Tax (COFINS)
credit declarations for the
second quarter of 2012,
which were determined to
be in the non-cumulative
system. (proportionality of
the
PIS
and
COFINS
credits)
We presented our administrative defense. The Court dismissed the
Company’s defense in December 2020. The Company filed an Appeal to the
Appellate Branch of the Internal Revenue Administrative Court (CARF in
Portuguese) that is pending a decision
11,614
LATAM
Airlines
Group
Argentina,
Brasil, Perú,
Ecuador,
y
TAM
Mercosur.
Juzgado de
1°
Instancia
en lo Civil
y
Comercial
Federal N°
11 de la
ciudad de
Buenos
Aires
1408/2017
Consumidores
Libres
Coop. Ltda. filed this
claim on March 14, 2017
regarding a provision of
services. It petitioned for
the
reimbursement
of
certain
fees
or
the
difference in fees charged
for
passengers
who
purchased a ticket in the
last 10 years but did not
use it.
Federal Commercial and Civil Trial Court No. 11 in the city of Buenos
Aires. After 2 years of arguments on jurisdiction and competence, the claim
was assigned to this court and an answer was filed on March 19, 2019. The
Court ruled in favor of the defendants on March 26, 2021, denying the
precautionary measure petitioned by the plaintiff. The plaintiff requested on
several occasions the opening of the trial, which was rejected by the Court
due to the lack of notification of previous resolutions. The evidentiary stage
has not yet begun in this case.
—
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 344
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10.880.93
8842/2013
-54
The decision denied the
petition for reassignment
and did not equate the
COFINS credit statements
for the third quarter of
2012
that
had
been
determined to be in the
non-accumulative system.
(proportionality of the PIS
and COFINS credits)
We presented our administrative defense. The Court dismissed the
Company’s defense. The Company filed an Appeal to the Appellate Branch
of the Internal Revenue Administrative Court (CARF in Portuguese) that is
pending a decision.
13,297
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10.880.93
8844/2013
-43
The decision denied the
petition for reassignment
and did not equate the
COFINS credit statements
for the third quarter of
2012
that
had
been
determined to be in the
non-accumulative
system. (proportionality of
the
PIS
and
COFINS
credits)
We presented our administrative defense. The Court dismissed the
Company’s defense in December 2020. The Company filed an Appeal to the
Appellate Branch of the Internal Revenue Administrative Court (CARF in
Portuguese) that is pending a decision.
12,195
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.938
841/2013-
18
The decision denied the
petition for reassignment
and did not equate the
COFINS credit statements
for the second quarter of
2012
that
had
been
determined to be in the
non-accumulative system.
(proportionality of the PIS
and COFINS credits)
We presented our administrative defense. The Court dismissed the
Company’s defense in December 2020. The Company filed an Appeal to the
Appellate Branch of the Internal Revenue Administrative Court (CARF in
Portuguese) that is pending a decision
11,991
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10840.727
719/2019-
71
The Federal Tax Service
issued a notice of violation
in applying for collection
of the PIS/COFINS tax for
2014 (proportionality of
the
PIS
and
COFINS
credits).
We presented our administrative defense on January 11, 2020. The Court
dismissed the Company’s defense in December 2020. The Company filed an
Appeal to the Appellate Branch of the Internal Revenue Administrative
Court (CARF in Portuguese). On September 17, 2024, the Judge made a
request to see the case file.
36,334
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 345
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
559/2017-
91
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
third quarter of 2014,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
It is about the non-approved compensation of Cofins. Administrative defense
submitted (Manifestação de Inconformidade). The Court dismissed the
Company’s defense in December 2020. The Company filed an Appeal to the
Appellate Branch of the Internal Revenue Administrative Court (CARF in
Portuguese) that is pending a decision.
10,482
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
547/2017-
67
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
first
quarter
of
2013,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
We presented our administrative defense (Manifestação de Inconformidade).
The Court dismissed the Company’s defense in December 2020. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese) that is pending a decision.
12,080
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
553/2017-
14
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
fourth quarter of 2013,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
We presented our administrative defense (Manifestação de Inconformidade).
The Court dismissed the Company’s defense in December 2020. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese) that is pending a decision.
11,682
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
555/2017-
11
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
first
quarter
of
2014,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
We presented our administrative defense (Manifestação de Inconformidade).
The Court dismissed the Company’s defense in December 2020. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese) that is pending a decision.
12,292
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 346
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
560/2017-
16
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
fourth quarter of 2014,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
We presented our administrative defense (Manifestação de Inconformidade).
The Court dismissed the Company’s defense in December 2020. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese) that is pending a decision.
10,784
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
550/2017-
81
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
third quarter of 2013,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
We presented our administrative defense (Manifestação de Inconformidade).
The Court dismissed the Company’s defense in December 2020. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese) that is pending a decision.
12,450
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
549/2017-
56
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
second quarter of 2013,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
We presented our administrative defense (Manifestação de Inconformidade).
The Court dismissed the Company’s defense in December 2020. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese) that is pending a decision.
10,413
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
10880.910
557/2017-
01
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
second quarter of 2014,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
We presented our administrative defense (Manifestação de Inconformidade).
The Court dismissed the Company’s defense in December 2020. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese) that is pending a decision.
9,869
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 347
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A
Receita
Federal do
Brasil
10840.722
712/2020-
05
Administrative trial that
deals with the collection of
PIS/Cofins proportionality
(fiscal year 2015).
TAM presented an administrative defense but the decision was unfavorable.
The Company filed a voluntary appeal (CARF) that is pending a decision.
29,099
TAM Linhas
Aéreas S.A.
Receita
Federal do
Brasil
10880.978
948/2019-
86
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
fourth quarter of 2015,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
TAM filed its administrative defense on July 14, 2020. A decision is
pending. The Company filed an Appeal to the Appellate Branch of the
Internal Revenue Administrative Court (CARF in Portuguese) that is
pending a decision.
16,018
TAM Linhas
Aéreas S.A.
Receita
Federal do
Brasil
10880.978
946/2019-
97
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
third quarter of 2015,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
TAM filed its administrative defense on July 14, 2020 with an unfavorable
decision.The Company filed an appeal with the appellate administrative
court. A partial decision was made on the appeal on September 17, 2024
(voluntary appeal).
9,690
TAM Linhas
Aereas S.A.
Receita
Federal do
Brasil
10880.978
944/2019-
06
A decision was rendered
that refused the petition
for reassignment and did
not equate the COFINS
credit declarations for the
second quarter of 2015,
which meant the non-
accumulative
system
(proportionality of the PIS
and COFINS credits).
TAM filed its administrative defense on July 14, 2020 with an unfavorable
decision. A decision is pending. The Company filed an appeal with the
appellate administrative court. A partial decision was made on the appeal on
September 17, 2024 (voluntary appeal).
10,263
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 348
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Latam
Airlines
Group S.A
23°
Juzgado
Civil
de
Santiago
C-8498-20
20
Class Action Lawsuit filed
by
the
National
Corporation of Consumers
and
Users
(CONADECUS)
against
LATAM Airlines Group
S.A. for alleged breaches
of the Law on Protection
of Consumer Rights due to
flight cancellations caused
by
the
COVID-19
Pandemic, requesting the
nullity of possible abusive
clauses, the imposition of
fines and compensation for
damages in defense of the
collective
interest
of
consumers. LATAM has
hired specialist lawyers to
undertake its defense.
On 06/25/2020 we were notified of the lawsuit. On 04/07/2020 we filed a
motion for reversal against the ruling that declared the action filed by
CONADECUS admissible, the decision is pending to date. On 07/11/2020
we requested the Court to comply with the suspension of this case, ruled by
the 2nd Civil Court of Santiago, in recognition of the foreign reorganization
procedure pursuant to Law No. 20,720, for the entire period that said
proceeding lasts, a request that was accepted by the Court. CONADECUS
filed a remedy of reconsideration and an appeal against this resolution should
the remedy of reconsideration be dismissed. The Court dismissed the
reconsideration on August 3, 2020, but admitted the appeal. On March 1,
2023, the Court of Appeals resolved to omit the hearing of the case and
pronouncement regarding the appeal, in view of the fact that in January 2023
LATAM's request the end of the suspension of the process that was decreed
by resolution of July 17, 2020 in case file C-8498-2020 of the 23rd Civil
Court of Santiago, for which the file was sent to the first instance to continue
processing. On November 24, 2023, the Court dismissed LATAM’S motion
for reversal against the ruling that declared the action filed by
CONADECUS admissible. Accordingly, on December 4, 2023, LATAM
filed the statement of defense. A reconciliation hearing was held on March
27, 2024, but no agreement was reached. An interim decision on evidence
was rendered on May 14, 2024, and on June 18th, the reconsideration of that
resolution was denied, which began the evidentiary period.The amount at the
moment is undetermined.
—
TAM Linhas
Aéreas S.A
Receita
Federal de
Brasil
13074.72
6429/202
1-41
Notice
of
a
violation
prepared for the COFINS
request regarding taxable
events
presumably
occurring between 2016
and 2017.
TAM filed its administrative defense with an unfavorable decision. The
Company filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese). A partial decision on the appeal
by LATAM Airlines Brazil was rendered on August 21, 2024. We need to
wait for service of the decision to evaluate the next steps to take.
16,747
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 349
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
Receita
Federal de
Brasil
2007.34.0
0.009919-
3(000985
0-54.2007
.4.01.340
0)
A
lawsuit
seeking
to
review the incidence of the
Social
Security
Contribution taxed on 1/3
of
vacations,
maternity
payments
and
medical
leave for accident.
In March 2007, the company filed a lawsuit protesting a court order so that
the impact of social security payments on funds would not be eliminated
(social security payments are applicable to 1/3 of vacation time, salary
during maternity leave and illness subsidies). The decision rendered on
February 2, 2008 was against the company, so it filed an appeal. The
Appellate Court issued a decision partially in favor of the company. A
Special/Extraordinary Remedy was filed that was stayed until the Court’s
decision – (Topic STF 985). The matter was partially decided in the Supreme
Court’s decision of June 2024 (STF) on the “leading case” of another
company. After analyzing the decision by the Federal Supreme Court,
LATAM Airlines Brazil confirmed that payments are owed for one-third of
the vacation time from September 2020 to May 2024.
60,891
TAM Linhas
Aéreas S.A.
UNIÃO
FEDERAL
0052711-
85.1998.4
.01.0000
An indemnity claim to
collect
a
differentiated
price from the Federal
Union
because
of
the
disruption of the economic
equilibrium
in
the
concession
agreements
between 1988 and 1992.
The indemnity, should the
action prosper, cannot be
estimated (Price Freeze).
The lawsuit began in 1993. In 1998, there was a decision favorable to TAM.
The process reached the Court, and in 2019, the decision was against TAM.
The company has appealed and a decision is pending.
—
TAM Linhas
Aéreas S.A
Tribunal
do Trabajo
de
São
Paulo
1000115-
90.2022.5
.02.0312
A class action whereby the
Air Transport Union is
petitioning for payment of
additional hazardous and
unhealthy
work
retroactively and in the
future for maintenance/
CML employees.
The action was considered partially valid. The case is awaiting hearing by
the Regional Labor Court.
430
TAM Linhas
Aéreas S.A
Receita
Federal
15746.72
8063/202
2-00
This is an administrative
claim regarding alleged
irregularities
in
the
payment
of
Technical
Assistance (SAT) in 2018.
The trial court administrative defense has been presented and the ruling was
adverse. The company filed an appeal that was referred to the Brazilian
Federal Administrative Tax Court (CARF in Portuguese) for a ruling on
December 4, 2024. One of the judges asked to analyze the case on the day of
the hearing, so a new hearing date is pending.
14,930
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 350
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A
União
Federal
1003320-
78.2023.4
.06.3800
Legal action to discuss the
debit of the administrative
process
10611.720630/2017-16
(fine
for
violation
of
incorrect registration in
DI- import declaration)
Distributed on January 19, 2023. The company obtained a precautionary
measure suspending the collection without the need for a guarantee. Process
awaiting response from the National Treasury. The decision was in favor of
the company and the debt was canceled. A remedy filed by União Federal is
pending.
18,225
TAM Linhas
Aéreas S.A
União
Federal
12585.72
0017/201
2-84
This is a petition to
recover a credit
(proportional) in the 3rd
quarter of 2010 under the
Social Security Financing
Contribution program
(abbreviated as COFINS
in Portuguese).
Administrative defense presented. The administrative defense was denied.
The Company presented a Voluntary Appeal (CARF) which was denied. A
special appeal was presented, which was partially favorable. Waiting for the
“liquidação” decision to be finalized.
8,690
TAM Linhas
Aéreas S.A
União
Federal
10880-98
2.487/202
0-80
This is a petition to
recover
a
credit
(proportional) in the 4rd
quarter of 2016 under the
Social Security Financing
Contribution
program
(abbreviated as COFINS
in
Portuguese)
(proportionality of the PIS
and COFINS credits)
An administrative defense was presented but was dismissed. The Company
filed an Appeal to the Appellate Branch of the Internal Revenue
Administrative Court (CARF in Portuguese). On September 17, 2024, the
proceedings became a measure to analyze time-barred credits.
8,637
TAM Linhas
Aéreas S.A
União
Federal
10880-96
7.530/202
2-49
This is a petition to
recover
a
credit
(proportional) in the 1rd
quarter of 2018 under the
Social Security Financing
Contribution
program
(abbreviated as COFINS
in
Portuguese).
(proportionality of the PIS
and COFINS credits)
An administrative defense was presented. A decision is pending.
8,963
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 351
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A
União
Federal
10880-96
7.532/202
2-38
This is a petition to
recover
a
credit
(proportional) in the 2rd
quarter of 2018 under the
Social Security Financing
Contribution
program
(abbreviated as COFINS
in
Portuguese).
(proportionality of the PIS
and COFINS credits)
An administrative defense was presented and a decision is pending.
9,621
TAM Linhas
Aéreas S.A
União
Federal
10880-96
7.533/202
2-82
This is a petition to
recover
a
credit
(proportional) in the 4rd
quarter of 2018 under the
Social Security Financing
Contribution
program
(abbreviated as COFINS
in
Portuguese).
(proportionality of the PIS
and COFINS credits)
An administrative defense was presented and a decision is pending.
16,961
TAM Linhas
Aéreas S.A
União
Federal
19613.72
5650/202
3-86
A Notice of Violation
prepared in the petition by
the
Social
Integration
Program (abbreviated as
PIS in Portuguese) and by
COFINS on taxable events
allegedly
occurring
between May 2018 and
December
2018.
(proportionality of the PIS
and COFINS credits)
An administrative defense was presented and a decision is pending.
11,878
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 352
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM
Airlines
Group S.A.
Tribunal
de Defensa
de la Libre
Competenc
ia
445-2022
On May 21, 2022, Agunsa
filed a petition to TDLC
for a preliminary
preparatory measure of
exhibition of documents in
respect of Aerosan,
Depocargo, Sociedad
Concesionaria Nuevo
Pudahuel and Fast Air in
which Agunsa claimed
that it was impacted by
alleged anti-competition
practices on the import
cargo warehousing market
at the Arturo Merino
Benitez International
Airport.
Fast Air was served on June 9, 2022 and on June 13, 2022, it lodged
opposition against this petition, which was partially sustained by the
Antitrust Court (TDLC) on July 19, 2022, in which the new exhibition date
was set as August 22nd (the original date set by the court was July 1, 2022).
On July 25, 2022, Fast Air requested a reconsideration of this latter court
decision and petitioned that the temporary scope of the exhibition be
reduced. Fast Air’s petition was sustained and the scope of the documents to
be revealed was limited even further. On August 12th, Fast Air petitioned
that a new date and time be set for the exhibition hearing. The court granted
this latter request on August 17th and set the exhibition date as August 31st.
Fast Air appeared with 368 files and asked for confidentiality and/or secrecy
of all of the information presented. The public versions have already been
added to the case file as final versions. Aerosan began a separate, but related,
non-contentious inquiry on April 20, 2023 before the Anti-Trust Court
(abbreviated as TDLC in Spanish) petitioning that the TDLC decide whether
the enforcement of Exempt Resolution #152 of the National Customs Bureau
would violate Decree Law 211. Said Resolution #152 granted Agunsa
permission to operate as a cargo warehouse at the North Warehouse facility.
On January 10, 2024, the Public Hearing of the case was held. On July 15,
2024, the TDLC resolved that the Resolution of the National Customs
Bureau consulted by Aerosan did not violate Law Decree No. 211. For the
time being, the amount is indeterminate.
—
LATAM
Airlines
Group S.A.
Tribunal
de Defensa
de la Libre
Competenc
ia
489-2023
A preliminary
precautionary measure
was filed by the Tourism
Companies Trade
Association of Chile
seeking that LATAM’s
NDC system cease to be
implemented or,
alternatively, that
collection of the
Distribution Cost
Recovery Fee be
suspended and that
LATAM be forbidden to
limit the inventory of
tickets available through
the indirect distribution
channel.
On May 24, 2023 the preliminary measure was initially rejected. However,
after accepting an appeal for reinstatement of ACHET, said resolution was
annulled on June 8, 2023, providing instead that partially accepts the
precautionary measure only in terms of suspending the Distribution Cost
Recovery Fee and prohibiting any unjustified limitation of the inventory of
tickets available for the indirect distribution channel. On July 27, 2023, the
TDLC issued a ruling favorable to LATAM, which annulled the
precautionary measure in its entirety for not complying with the legal
requirements. or the time being, the amount is indeterminate.
—
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 353
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM
Airlines
Group S.A.
23°
Juzgado
Civil de
Santiago
C-8156-2
022
A class action filed by
CONADECUS
against
LATAM Airlines Group
S.A. for alleged violations
of
the
Consumer
Protection Law because of
the cancellation of tickets
for
international
flights
purchased through travel
agencies. It petitioned for
fines
and
damage
indemnities to be imposed
in defense of the collective
and/or diffuse interest of
consumers. LATAM has
retained specialized legal
counsel to defend it.
We were served the claim on September 21, 2023. On September 30, 2023,
we filed a remedy of reconsideration against the decision that declared the
lawsuit filed by CONADECUS admissible, which was dismissed by the
Court on November 11, 2023. On November 18, 2023, LATAM filed the
statement of defense. On August 6, 2024, LATAM petitioned that the
proceedings be declared to have been abandoned. For the time being, the
amount is undetermined.
—
TAM Linhas
Aéreas S.A
União
Federal
10880.96
7587/202
2-48
This
is
about
the
unaccredited
compensation/
reimbursement and redress
regarding
the
improper
payment of the monthly
federal social assistance
contribution (Cofins, as
abbreviated in Portuguese)
made in the third quarter
of 2018.
The administrative defense has been presented and a decision is pending.
9,687
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 354
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM
Airlines
Group S.A.
Tribunal
de Defensa
de la Libre
Competenc
ia
NC-388-2
011
On August 11, 2023, the
Civil
Aviation
Administration (“JAC,” as
abbreviated in Spanish)
filed
a
petition
for
clarification with the Anti-
Trust Court (“TDLC,” as
abbreviated in Spanish)
regarding Condition VIII.4
of
Decision
#37/2011
(“Condition VIII.4”). The
petition seeks to impose a
temporary
5
years
limitation
on
23
frequencies assigned by
the JAC to LATAM after
Decision #37 was issued.
The TDLC accepted LATAM’s remedy of reconsideration on October 17, 2023
and amended its previous ruling and dismissed the JAC’s petition for
clarification. On October 23, 2023, the JAC presented an appeal to the Supreme
Court requesting that the TDLC resolution be annulled and petitioned declared
admissible the remedy of reconsideration. The Supreme Court unanimously
dismissed the appeal against judgment by the JAC, LATAM opposed both
actions of the JAC. There are no appeals pending in this case.
In a separate but related process, JetSmart filed a non-contentious inquiry on
September 26, 2023, in relation to the terms of the future public tender of
aviation frequencies on the Santiago-Lima route. JetSmart requested an
injunction to suspend the tender and maintain the aviation frequency
assignments as currently held until the inquiry has finalized. The TDLC declared
the inquiry admissible on October 2, 2023, but only to begin a procedure to
determine whether the rules in the terms of the public aviation frequency tender
violate Decree Law 211, and dismissed the request for provisional measures.
JetSmart filed two remedies of reconsideration against the decision by the
Antitrust Court on October 4, 2023. The JAC became a party to such motions on
October 6, 2023 and LATAM became a party to the process on October 10,
2023, and it requested that the motions filed by JetSmart be dismissed. On
October 16, 2023, the TDLC took into account the considerations presented by
LATAM and rejected the two motions for reconsideration filed by JetSmart. On
October 19, 2023 CONADECUS requested to become part of this process and
requested the same injuction previously rejected twice by the TDLC.
(Continues on the next page)
—
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 355
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(Continues from the previous page)
On October 23, 2023 LATAM submitted a brief to the TDLC requesting the
rejection of saidinjuction now requested by CONADECUS. On October 23,
2023, a public auction was held by JAC for thirteen international frequencies for
the Santiago - Lima route, LATAM won ten of thirteen of these routes. On
October 24, 2023, JetSmart once again requested that an injunction be issued
regarding the public tender of aviation frequencies on the Santiago-Lima route.
On October 30, 2023, LATAM filed a brief petitioning for the dismissal of the
new precautionary measure petition of JetSmart. On November 2, 2023, the
TDLC rejected the request for injunctions submitted by JetSmart and
CONADECUS. On December 5, 2023, JetSmart complied with TDLC
procedural order and published in the Chilean official newspaper a notice calling
interested parties and stakeholders to submit information and opinions regarding
JetSmart’s inquiry . On December 21, 2023 the FNE requested to be an
intervening party in the process and requested to extend the deadline to provide
background information. The TDLC accepted the postponement, leaving the
deadline for providing information as February 5, 2024. On February 1, 2024,
LATAM submitted a brief to TDLC advocating for its position and providing
background information regarding JetSmart’s inquiry. The Office of the National
Economic Prosecutor (FNE), the JAC, the National Consumer Service
(SERNAC), Sky Airline and CONADECUS also provided information in
January and February 2024. The Civil Aviation Board submitted a petition for
clarification to the Antitrust Court on February 13, 2024, asking whether a tender
could be convened of international frequencies on the Santiago-Lima Route that
expire in 2024. LATAM filed a brief on February 15, 2024 stating that no matter
needed to be clarified and that the petition should be dismissed. The Antitrust
Court ruled against the Civil Aviation Board on February 15, 2024 because there
were no obscure or doubtful aspects to clarify. On April 25, 2024, a tender was
held for two Santiago-Lima frequencies and both were awarded to JetSmart.
LATAM furnished the certificate of that tender to the Antitrust Court. On June
19, 2024, LATAM accompanied an economic report and observations to the
report presented by JetSmart. On July 19, 2024, the JAC, JetSmart, LATAM and
Sky presented additional information. On July 31, 2024, the Public Hearing was
held at the TDLC, with the participation of the JAC, the FNE, JetSmart,
CONADECUS and LATAM. On December 18, 2024, the Antitrust Court of
Chile (TDLC in Spanish) asked the Office of the National Economic Prosecutor
(FNE in Spanish) to report on the status of the investigation in Case #2755-24
mentioned in the information it provided, and it asked the Civil Aviation Board
(JAC in Spanish) to report on the status of the citizen consultation regarding a
change in the frequency assignment regulations. Both the FNE and the JAC
presented their responses on December 24, 2024. On January 10, 2025, the
TDLC dismissed JetSmart’s petition in the non-contentious process dated
September 26, 2023 and declared that the tender terms and conditions created no
material risks that might violate the provisions in Decree Law 211. On January
24, 2025, JetSmart filed an appeal against the TDLC ruling. On January 29,2025,
the TDLC declared it admissible and sent it to the Supreme Court for
consideration and resolution.
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 356
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
TAM Linhas
Aéreas S.A.
União
Federal
10880.967
612/2022-
93
This is a petition to
recover a credit Cofins in
the 1rd quarter of 2019
(proportionality of the PIS
and COFINS credits)
The administrative defense has been presented and a decision is pending.
9,615
TAM Linhas
Aéreas S.A.
Superior
Tribunal
de Justiça
(STJ)
0042711-6
1.2007.8.0
5.0001
(1449899)
Trial involving a
commercial representation
contract signed directly
with the company Gm
Serviços Auxiliares de
Transporte Aéreo Ltda.
alleging the irregular
closing of the contract,
requesting payment of
compensation.
The procedure before the Court of Appeal is pending. An agreement was
made for the payment of ThUS$4,480 (R$25,000,000.00).The payment in
the agreement was made in full.
—
TAM Linhas
Aéreas S.A
UNIÃO
FEDERAL
1012674-8
0.2018.4.0
1.3400
Legal actions for members
to have the right to collect
contributions in the payroll
collectible on the basis of
gross sales.
This claim was filed in 2018. In January 2020, a decision favorable to the
Company was rendered so that contributions would be collected on the basis
of gross income. The company recently learned that the Superior Courts are
rendering decisions unfavorable to contributors. They have ruled against the
contributor in a recent decision. In December/2023 the position was
withdrawn.
—
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 357
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM
Airlines Perú
S.A.
Tribunal
Fiscal
-
An appeal will be filed
before the legal deadline
against Intendancy
Resolution
#4070140001797 served
December 31, 2024, which
declared the Company’s
remedy of claim
unfounded. Decision
Resolutions
#0120030130232 and
#0120030130245 were
notified on December 22,
2022, as was Fine
Resolution
#0120020038314, notified
on December 22, 2022 and
Determination Resolution
No. 0120030130245 for
indirect disposal of income
not susceptible to
subsequent tax control
linked to the objections
made to determination of
third category net income
for fiscal year 2015.
On January 26, 2023, the Company filed an appeal against the determination
and fine resolutions issued by SUNAT. Through Resolution of the
Intendencia No. 4070340000928 dated December 19, 2023, SUNAT
declared the appeal filed by the Company founded and, consequently,
Determination Resolutions No. 012-003-0130232, No. 012-003- 0130245
and Fine Resolution No. 012-002-0038314 are void. The audit area voided
the objection to the Major Maintenance expense of approximately $63
million
in
the
notice
of
Complementary
Outcome
of
Request
#0122220002363 dated September 4, 2024. However, it maintains the other
objections. Decision Resolutions #0120030139681 and #0120030139682
were notified on September 16, 2024, as was Fine Resolution
#0120020040024 because of a violation of Article 178.1 of the Tax Code.
The Company filed a remedy of claim on October 23, 2024 against those
resolutions, which was processed under Claim Docket #4070340001599.
However, the National Customs and Tax Administration Commission
(SUNAT in Spanish) decided, in Intendancy Resolution #4070140001797
notified December 31, 2024, to declare that the Company’s remedy of claim
was unfounded. Consequently, an appeal will be filed against that resolution
before the legal deadline.
122,953
TAM Linhas
Aéreas S.A
União
Federal
10880-927
.871/2023-
62
This is a petition to
recover Social Security
Funding Contributions
(Cofins in Portuguese)
from the first semester of
2020 (proportionally).
The administrative defense has been presented and a decision is pending.
11,059
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
113
TAM Linhas
Aéreas
União
Federal
19613.720
519/2024-
11
On February 7, 2024, the
Brazilian Federal Tax
Service issued a tax
assessment against TAM
Linhas Aéreas
(19613.720519/2024-11)
for the amount of
ThUS$47.104
(MR$262.845) related to
certain tax credits on “PIS
COFINS” ( Federal Social
Contributions Taxed on
Gross Income) during the
2019/2020 period.
The company filed an administrative response challenging the total amount
of the tax assessment. The company received a partial decision on its defense
on September 11, 2024. The company filed an appeal and is awaiting a
decision on it.
44,638
LATAM
Airlines
Group S.A.
15°
Juzgado
Civil
de
Santiago
C-15990-2
024
This is a class action filed
by the National
Consumers and Users
Association (abbreviated
as CONADECUS in
Spanish) against LATAM
Airlines Group S.A.,
American Airlines, Inc.
and Delta Airlines, Inc.
alleging several
infringements of the
Consumer Protection Law
because flights were
cancelled due to a flaw in
the Crowdstrike antivirus
software. It is petitioning
for the imposition of fines
and a damage indemnity in
defense of the collective or
diffuse interest of
consumers.
LATAM has retained expert attorneys to handle its defense. LATAM
Airlines Group was served the claim on September 17, 2024. On September
27, 2024, LATAM filed a remedy of reconsideration against the resolution
that declared the action filed by the National Consumers and Users
Association (CONADECUS in Spanish) admissible, which was dismissed by
the court on November 20, 2024. LATAM filed a brief of answer to the
claim on December 9, 2024. The amount is as yet undetermined.
-—-
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
› 358
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM
Airlines
Brasil
Tribunales
de Justicia
del Estado
de
Sao
Paulo
Rol
1002928-3
0.2024.8.2
6.0659;
Rol
1174718-1
3.2024.8.2
6.0100;
Rol
1001368-4
2.2024.8.2
6.0695;
Rol
0012257-6
6.2024.5.1
5.0004;
Rol
1182239-0
9.2024.8.2
6.0100;
Rol
1003874-0
2.2024.8.2
6.0659
Lawsuits against the
companies Voepass and
LATAM Airlines Brasil
for alleged liability in civil
proceedings, presented by
Luana dos Santos Bezerra
Bounhe and others; Aracy
Ribeiro Moreira and
others; Naira Maria da
Silva Gusson do
Nascimento; Laura dos
Reis Camilo and another;
and Silvia Nicole Dantas
Costa Maia and others;
and a lawsuit against the
same companies for
alleged labor liability filed
by Marcus Vinicius Ávila
Santanna and others.
In the litigation with Luana dos Santos Bezerra Bounhe and others (Role
1002928-30.2024.8.26.0659), on December 19, 2024, the parties submitted a
request for approval of the agreement concluded extrajudicially. The
remaining 5 processes remain in process. All these litigations are under
insurance coverage.
—
LATAM
Airlines
Brasil
União
Federal
17459.720
028/2024-
67
A Notice of Infringement
was received in which the
business fund
amortizations (agiotage)
made in the 2019 and 2020
calendar years were
rejected in the calculation
of Business Income Tax
(IRPJ in Portuguese) and
the Social Assessment on
Earnings (CSL in
Portuguese).
An administrative defense has been presented and we are awaiting a
decision.
20,653
Company
Court
Case
Number
Origin
Stage of trial
Amounts
Committed (*)
ThUS$
In order to deal with any financial obligations arising from legal proceedings in effect at December 31, 2024,
whether civil, tax, or labor, LATAM Airlines Group S.A. and Subsidiaries, has made provisions, which are
included in Other non-current provisions that are disclosed in Note 20.
The Company has not disclosed the individual probability of success for each contingency in order to not
negatively affect its outcome.
(*) The Company has reported the amounts involved only for the lawsuits for which a reliable estimation can
be made of the financial impacts and of the possibility of any recovery, pursuant to Paragraph 86 of IAS 37
Provisions, Contingent Liabilities and Contingent Assets.
› 359
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
II. The following table contains the proceedings that were closed or changed to remote status during 2024, according to what was disclosed in the contingencies note of the corresponding
financial statement:
Company
Court
Case
Number
Origin
Stage of trial
Status
LATAM
Airlines
Group
S.A
22° Juzgado
Civil
de
Santiago
C-29.945-2
016
The Company received notice of
a
civil
liability
claim
by
Inversiones Ranco Tres S.A. on
January
18,
2017.
It
is
represented
by
Mr.
Jorge
Enrique Said Yarur. It was filed
against LATAM Airlines Group
S.A. for an alleged contractual
default by the Company and
against Ramon Eblen Kadiz,
Jorge Awad Mehech, Juan Jose
Cueto Plaza, Enrique Cueto
Plaza and Ignacio Cueto Plaza,
directors and officers, for alleged
breaches of their duties. In the
case of Juan Jose Cueto Plaza,
Enrique Cueto Plaza and Ignacio
Cueto Plaza, it alleges a breach,
as controllers of the Company,
of
their
duties
under
the
incorporation
agreement.
LATAM
has
retained
legal
counsel specializing in this area
to defend it.
The claim was answered on March 22, 2017 and the plaintiff filed its replication on
April 4, 2017. LATAM filed its rejoinder on April 13, 2017, which concluded the
argument stage of the lawsuit. A reconciliation hearing was held on May 2, 2017, but
the parties did not reach an agreement. The Court issued the evidentiary decree on
May 12, 2017. We filed a petition for reconsideration because we disagreed with
certain points of evidence. That petition was partially sustained by the Court on June
27, 2017. The evidentiary stage commenced and then concluded on July 20, 2017.
Observations to the evidence must now be presented. That period expires August 1,
2017. We filed our observations to the evidence on August 1, 2017. We were served
the decision on December 13, 2017 that dismissed the claim since LATAM was in no
way liable. The plaintiff filed an appeal on December 26, 2017. Arguments were pled
before the Santiago Court of Appeals on April 23, 2019, and on April 30, 2019, this
Court confirmed the ruling of the trial court absolving LATAM. The losing party was
ordered to pay costs in both cases. On May 18, 2019, Inversiones Ranco Tres S.A.
filed a remedy of vacation of judgment based on technicalities and on substance
against the Appellate Court decision. The Appellate Court admitted both appeals on
May 29, 2019. On August 11, 2021 Inversiones Ranco Tres S.A. requested the
suspension of the hearing of the Appeal, after the recognition by the 2nd Civil Court
of Santiago of the foreign reorganization procedure in accordance with Law No.
20,720, for the entire period that said procedure lasts, a request that was accepted by
the Supreme Court. In December 2022 LATAM requested the end of the suspension,
which was granted on February 17, 2023. Arguments were presented to the Supreme
Court on April 27, 2023. On August 4, 2023, the Supreme Court dismissed the
remedies of vacation of judgment based on substance and form filed by Inversiones
Ranco Tres S.A. The resolution rejecting the claim remains firm and enforceable. The
assessment of personal and procedural costs in favor of LATAM was carried out by
both the Court of Appeals and the Court of First Instance. Case closed.
Disclosed in the
Company's
consolidated
financial
statements as of
December 2023
LatamAirlines
Ecuador S.A
Tribunal
Distrital de lo
Fiscal
17509-201
4-0088
An audit of the 2006 Income Tax
Return
that
disallowed
fuel
expenses, fees and other items
because the necessary support
was not provided, according to
Management.
On August 6, 2018, the District Tax Claims Court rendered a decision denying the
request for a refund of a mistaken payment. An appeal seeking vacation of this
judgment by the Court was filed on September 5th and we are awaiting a decision by
the Appellate judges. As of December 31, 2018, the attorneys believed that the
probability of recovering this sum had fallen to 30%-40% because of the pressure
being put by the Executive Branch on the National Court of Justice and the Judiciary
in general for rulings not to affect government revenues and because the case involves
differences that are based on insufficient documentation supporting the expense.
Given the percentage loss (above 50%), the accounting write-off of this recovery has
been carried out. As of this date, the Sala Especializada de lo Contencioso Tributario
de la Corte Nacional de Justicia has decided by ruling not to accept the appeal, so the
Company is analyzing whether to take additional actions or close the process. The
company has decided not to continue with the lawsuit.
Disclosed in the
Company's
consolidated
financial
statements as of
March 2024
› 360
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Latam
Airlines
Group S.A.
25° Juzgado
Civil
de
Santiago
C-8903-20
20
Class Action Lawsuit filed by
AGRECU
against
LATAM
Airlines Group S.A. for alleged
breaches
of
the
Law
on
Protection of Consumer Rights
due to flight cancellations caused
by the COVID-19 Pandemic,
requesting the nullity of possible
abusive clauses, the imposition
of fines and compensation for
damages in defense of the
collective interest of consumers.
LATAM has hired specialist
lawyers to undertake its defense
On July 7, 2020 we were notified of the lawsuit. We filed our answer to the claim on
August 21, 2020. A settlement was reached with AGRECU at that hearing that was
approved by the Court on October 5, 2020. On October 7, 2020, the 25th Civil Court
confirmed that the decision approving the settlement was final and binding.
CONADECUS filed a brief on October 4, 2020 to become a party and oppose the
agreement, which was dismissed on October 5, 2020. It petitioned for an official
correction on October 8, 2020 and the annulment of all proceedings on October 22,
2020, which were dismissed, costs payable by CONADECUS, on November 16,
2020 and November 20, 2020, respectively. LATAM presented reports on the
implementation of the agreement on May 19, 2021, November 19, 2021 and May 19,
2022, which concluded its obligation to report on that implementation. On December
28, 2022 the Civil Court ordered the filing of the file. The National Consumer and
User Association (CONADECUS) filed appeals against these decisions with the
Santiago Appellate Court that were joined under Case #14,213-2020. Arguments
were made on March 8, 2023. In a decision on August 8, 2023, the Appellate Court
dismissed the appeals by CONADECUS, costs included. On August 26, 2023,
CONADECUS filed a petition based on technicalities and substance against the
Appellate Court ruling in order to have it reversed by the Supreme Court. LATAM
petitioned that such appeals be declared inadmissible in a brief filed September 13,
2023. On November 30, 2023, the Supreme Court declared CONADECUS’ petition
inadmissible. On December 7, 2023, LATAM petitioned that the Appellate Court
determine the costs of the procedure, which must be defrayed by CONADECUS. The
procedural costs were set on December 19, 2023 and personal costs were decided on
January 3, 2024. The costs of the trial court are currently pending, which were
petitioned by LATAM on December 20, 2023. CONADECUS currently has no
petitions against the settlement reached between LATAM and AGRECU. Case
closed.
Disclosed in the
Company's
consolidated
financial
statements as of
March 2024
LATAM
Finance Limited
Grand Court
of
the
Cayman
Islands
—
Request
for
a
provisional
bankruptcy process.
On May 26, 2020, LATAM Finance Limited submitted a request for a provisional
liquidation in the Grand Court of the Cayman Islands, covered in the reorganization
proceeding filed before the Bankruptcy Court of the United States of America, which
was accepted on May 27, 2020 by the Grand Court of the Cayman Islands. On
September 28, 2020, LATAM Finance Limited filed a petition to suspend the
liquidation. On October 9, 2020, the Grand Court of Cayman Islands accepted the
petition and extended the status of temporary liquidation for a period of 6 months. On
May 13, 2021, LATAM Finance Limited filed a petition to suspend the liquidation.
On May 18, 2021, the Grand Court of Cayman Islands accepted the petition and
extended the status of temporary liquidation until October 9, 2021. On December 1,
2021, LATAM Finance Limited filed a petition to suspend the liquidation, which was
accepted by the Grand Court of Cayman Islands. This extended the status of the
provisional liquidation through April 9, 2022. On August 22, 2022, LATAM Finance
Limited petitioned for a suspension of the liquidation, which was granted by the
Grand Court of the Cayman Islands. The provisional liquidation was extended to
October 9, 2022 and the process continues in effect. That petition was sustained by
the Grand Court of the Cayman Islands on October 4, 2022. On September 30, 2022,
LATAM Finance Limited filed an application for validation of security obligations
arising in connection with the DIP to Exit and new DIP facilities. On October 04,
2022, the Grand Court made an Order validating such application. On May 23, 2024,
the Grand Court of Cayman Islands approved withdrawal of the petition for a
provisional liquidation requested May 8, 2024, and cancelled the appointment of the
provisional liquidators of LATAM Finance Limited, thereby putting an end to the
status of provisional liquidation of the company in the Cayman Islands. Case closed
Disclosed in the
Company's
consolidated
financial
statements as of
June 2024
› 361
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Peuco
Finance
Limited
Grand Court
of
the
Cayman
Islands
—
Request
for
a
provisional
bankruptcy process.
On May 26, 2020, Peuco Finance Limited submitted a request for a provisional
liquidation in Grand Court of the Cayman Islands, covered in the reorganization
proceeding filed before the Bankruptcy Court of the United States of America, which
was accepted on May 27, 2020 by the Grand Court of the Cayman Islands. On
September 28, 2020, Peuco Finance Limited filed a petition to suspend the
liquidation. On October 9, 2020, the Grand Court of Cayman Islands accepted the
petition and extended the status of temporary liquidation for a period of 6 months.
The lawsuit continues to be active. On May 13, 2021, Peuco Finance Limited filed a
petition to suspend the liquidation. On May 18, 2021, the Grand Court of Cayman
Islands accepted the petition and extended the status of temporary liquidation until
October 9, 2021. On December 1, 2021, Peuco Finance Limited filed a petition to
suspend the liquidation, which was accepted by the Grand Court of Cayman Islands.
This extended the status of the provisional liquidation through April 9, 2022. On
August 22, 2022, Peuco Finance Limited petitioned for a suspension of the
liquidation, which was granted by the Grand Court of the Cayman Islands. The
provisional liquidation was extended to October 9, 2022 and the process continues in
effect. That petition was sustained by the Grand Court of the Cayman Islands on
October 4, 2022. On September 30, 2022, Peuco Finance Limited filed an application
for validation of security obligations arising in connection with the DIP to Exit and
new DIP facilities. On October 04, 2022, the Grand Court made an Order validating
such application. On May 23, 2024, the Grand Court of Cayman Islands approved
withdrawal of the petition for a provisional liquidation requested May 8, 2024, and
cancelled the appointment of the provisional liquidators of Peuco Finance Limited,
thereby putting an end to the status of provisional liquidation of the company in the
Cayman Islands. Case closed
Disclosed in the
Company's
consolidated
financial
statements as of
June 2024
Piquero Leasing
Limited
Grand Court
of
the
Cayman
Islands
—
Request
for
a
provisional
bankruptcy process
On July 08, 2020, Piquero Leasing Limited submitted a request for a provisional
liquidation in Grand Court of the Cayman Islands, covered in the reorganization
proceeding filed before the Bankruptcy Court of the United States of America, which
was accepted on July 10, 2020, by the Grand Court of the Cayman Islands. Piquero
Leasing Limited entered a motion to suspend the liquidation on September 28, 2020.
On October 9, 2020 the Grand Court of the Cayman Islands granted the motion and
extended the provisional liquidation status for 6 months. On May 13, 2021, Piquero
Leasing Limited filed a petition to suspend the liquidation. On May 18, 2021, the
Grand Court of Cayman Islands accepted the petition and extended the status of
temporary liquidation until October 9, 2021. On December 1, 2021, Piquero Leasing
Limited filed a petition to suspend the liquidation, which was accepted by the Grand
Court of Cayman Islands. This extended the status of the provisional liquidation
through April 9, 2022. On August 22, 2022, Piquero Leasing Limited petitioned for a
suspension of the liquidation, which was granted by the Grand Court of the Cayman
Islands. The provisional liquidation was extended to October 9, 2022 and the process
continues in effect. On May 23, 2024, the Grand Court of Cayman Islands approved
withdrawal of the petition for a provisional liquidation requested May 8, 2024, and
cancelled the appointment of the provisional liquidators of Piquero Leasing Limited,
thereby putting an end to the status of provisional liquidation of the company in the
Cayman Islands. Case closed
Disclosed in the
Company's
consolidated
financial
statements as of
June 2024
› 362
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
Tam
Linhas
Aéreas S.A.
Secretaria da
Receita
Federal
do
Brasil.
10880.722.
355/2014-5
2
On August 19th, 2014 the
Federal Tax Service issued a
notice of violation stating that
compensation credits Program
(PIS) and the Contribution for
the Financing of Social Security
COFINS by TAM are not
directly related to the activity of
air transport. (a case related to
the
theory
argued
by
the
company on the proportionality
of the PIS and COFINS credits).
An objection was filed administratively on September 17, 2014. The lower court
rendered a partially favorable ruling on June 1, 2016 that reversed the previous
separate fine. A voluntary remedy was filed on June 30, 2015 on which a judgment by
the Board of Tax Appeals is pending. The case was sent to the Second Panel of the
Fourth Room of the Third Judgment Section of the Board of Tax Appeals
(abbreviated as CARF in Portuguese). The CARF judges partially sustained the
company’s appeal to pay part of the debt (we did not appeal the other part). The
Ministry of Finance of Brazil filed a special remedy. The CARF dismissed the
Ministry’s remedy in September 2019, but it filed a complaint that was denied by the
CARF. A decision was rendered in favor of the company that cancelled the debt. Case
closed.
Disclosed in the
Company's
consolidated
financial
statements as of
June 2024
TAM
Linhas
Aéreas S.A.
Tribunal
del
Trabajo
de
Brasília/ DF
0000038-2
5.2021.5.1
0.0017
This civil suit was filed by the
National Pilots Union seeking
that the company be ordered to
pay for meals daily when pilots
are on alert status
The action was considered favorable to TAM and closed
Disclosed in the
Company's
consolidated
financial
statements as of
June 2024
SNEA
(Sindicato
Nacional
das
empresas
aeroviárias)
União Federal
0012177-5
4.2016.4.0
1.3400
A claim filed by TAM and
SNEA against the 72% increase
in airport control fees (TAT-
ADR) and approach control fees
(TAT-APP)
charged
by
the
Airspace Control Department
(“DECEA”).
On January 30th, 2024, SNEA obtained a favorable court decision from the 2nd
Instance (TRF1), regarding its appeal. SNEA filed an appeal (motion for clarification)
to clarify missing points regarding the deposits made with the court. On September
24, 2024, a decision was rendered in favor of LATAM Airlines Brazil authorizing it
to withdraw 100% of the guarantee deposits after it presents an insurance policy.
Considering this resolution, the contingency has been classified as remote, so the
company reversed the provision.
Disclosed in the
Company's
consolidated
financial
statements as of
September 2024
› 363
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
LATAM
Airlines
Group
S.A
Sucursal
Perú
Tribunal
Fiscal
12511-202 2
Appeal filed on October 11,
2022, against the Intendencia
resolution No. 4070140000100,
which declared unfounded the
claim filed by the Company on
September, 20, 2022, against the
Determination Resolutions for
alleged omissions of the Income
Tax corresponding to the period
2014 and associated fines for the
violation typified in numeral 1 of
article 178 of the Tax Code. The
main
objections
relate
to
SUNAT's lack of knowledge of
the application of article 8 of the
CDI between Peru and Chile
regarding: i) Income obtained
from the exclusivity contract of
the Latam Pass program with the
Banco de Crédito del Perú, ii)
Income from sale of miles to
non-airline
partners
and
associated cost (sale of miles
from the Latam Pass program to
legal companies).
On August 29, 2024, we received service of the Tax Court Decision #07706-4-2024
revoking the part of Intendant Resolution #4070140000100 concerning objections to
Income Tax and income tax payments on exclusivity income from Banco de Crédito
del Perú and the sale of miles to non-airline partners. It also ordered that the balance
owed and the credit for payments made be recalculated. That recalculation does not
alter the use of that amount as a compensable credit and bears no relationship to the
objections dismissed. However, the National Customs and Tax Administration
Commission of Peru (abbreviated as SUNAT, in Spanish) can file a contentious
administrative claim with the Superior Court of Justice through November 29, 2024.
The contingency has been classified as remote
Disclosed in the
Company's
consolidated
financial
statements as of
September 2024
LATAM
Airlines
Perú
S.A.
Tribunal
Fiscal
Expedient e
de
Apelación N
° 2545-2023
Appeal against the resolution of
the
Intendencia
No.
4070140000253 that declared
the claim against Determination
Resolutions No. 0120030126112
to 0120030126123 and RM No.
0120020037412
to
0120020037423
partially
founded.
The
objections
contested through the values
indicated above correspond to
the taxable base of the IGV for
the national interline (domestic
national sale).
On September 16, 2022, an appeal was filed against the determination and fine
resolutions issued by SUNAT; being that, through Resolution of the Intendencia No.
4070140000253, the claim filed by the company was partially founded and, in
addition, (i) it rectified Annexes No. 01, 04, 05 and 06 of RD No. 0120030126112 to
No. 0120030126123. , (ii) the Annex to RM N° 0120020037412 to N°
0120020037423, (iii) the balance in favor of the IGV for the tax periods of January
and July 2016 contained in RD N° 0120030126112 and 0120030126118; and, (iv)
rectified and continued the collection of the tax debt contained in RD No.
0120030126113 to 0120030126117 and 0120030126119 to 0120030126123 and RM
No. 0120020037412 to 0120020037423. On January 11, 2023, an appeal was filed
against the this resolution which has been resolved and notified on April 10, 2024
through RTF 3149-9-2024, through which the Tax Court has decided to revoke RI
No. 4070140000253 and proceed to reliquidate the Tax. On June 28, 2024, notice was
received of Intendent Resolution #4070150000505 in which the National Customs
and Tax Administration Commission (SUNAT in Spanish) voided the amounts in
strict observance of the order by the Administrative Tax Court, thereby concluding
this administrative stage, with procedural effects from July 1, 2024. SUNAT did not
file a contentious administrative claim with the Superior Court of Justice against Tax
Court Decision #3149-9-2024, so the process has ended.
Disclosed in the
Company's
consolidated
financial
statements as of
September 2024
› 364
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
III. Governmental Investigations.
1) On April 6, 2019, LATAM Airlines Group S.A. received the resolution issued by the National Economic
Prosecutor's Office (FNE), which begins an investigation Role No. 2530-19 into the LATAM Pass frequent
passenger program. The last activity in this investigation corresponds to request for information received in
May 2019.
2) On October 15, 2019, LATAM Airlines Group S.A. received the resolution issued by the National Economic
Prosecuting Authority (“FNE”) which begins an investigation Role N°2585-19 into the agreement between
LATAM Airlines Group S.A. and Delta Air Lines, Inc (“Delta”). On August 13, 2021 FNE, Delta and LATAM
reached an out-of-court agreement that put an end to this investigation. On October 28, 2021, the Tribunal de
Defensa de la Libre Competencia approved the out-of-court agreement reached by LATAM and Delta with the
FNE. The investigation is completed.
3) LATAM Airlines Group S.A. received a resolution by the National Economic Prosecutor (FNE) on February
1, 2018 beginning Investigation 2484-18 on air cargo carriage. On August 29, 2023, the Office of the National
Economic Prosecutor (FNE) decided to separate part of the information from such investigation and created a
new Case #2729-23 relative to cargo carriage on charter flights from Santiago to Easter Island during the
pandemic. On August 28, 2023, the FNE sent LATAM an Official Ordinary Letter requesting additional
information, the response to which was sent on September 27, 2023. An Official Ordinary Letter was received
on October 14, 2024 in which the FNE requested additional information from LATAM. That letter was
answered on November 4, 2024. The most recent activity in the investigation of Case #2484-18 is an Official
Ordinary Letter dated November 21, 2024, which was answered in two parts: the first on December 6, 2024 and
the second on December 11, 2024.
4) LATAM Airlines Group S.A. received a resolution by the National Economic Prosecutor (FNE) on August
12, 2021 beginning Investigation N° 2669-21 on compliance with condition VII Res. N° 37/2011 from TDLC
related to restrictions as to certain codeshare agreements. On October 2, 2023, the FNE decided to separate part
of the information in such investigation. Case #2737-23 will be about the code share agreements between
LATAM and Delta that LATAM petitioned be amended; and Case #2669-21 will be about the remaining code
share agreements. In relation to the investigation with Role No. 2737-23, dated November 06, 2023, the FNE
and LATAM reached an extrajudicial agreement in order to allow certain codeshare agreements between
LATAM and Delta to be modified. On December, 7, 2023, TDLC approved the extrajudicial agreement reached
by LATAM and the FNE. An Official Ordinary Letter was received on March 4, 2024 in the investigation in
Case #2669-21 in which the FNE requested additional information from LATAM. That letter was answered on
March 15, 2024. An Official Ordinary Letter was received on April 19, 2024 in which the FNE requested
additional information from LATAM. That letter was answered on May 2, 2024. The most recent activity in the
investigation of Case #2669-21 is an Official Ordinary Letter dated December 11, 2024, which was answered in
two parts: the first on December 26, 2024 and the second on January 8, 2025.
5) The competition authority sent an inquiry [or request] to TAM Linhas Aéreas S.A. (LATAM Airlines Brasil)
with the objective of obtaining information regarding certain pricing issues, which was received by the
company on November 27, 2023. On December 29, 2023, CADE sent a new request to LATAM Airlines Brasil
requesting more complete information, to which LATAM responded in parts, on February 16, 2024, March 11,
2024, March 22, 2024 and June 11, 2024. LATAM Airlines Brasil is cooperating with the authority and remains
committed to transparency and compliance with all applicable rules and regulations.
6) The competition authority reacted to an article in the press and sent an official letter [or request] to TAM
Linhas Aéreas S.A. (LATAM Airlines Brazil) seeking information on the acquisition of other types of aircraft.
The company received it on March 21, 2024 and responded on April 1, 2024. CADE sent a new letter
requesting additional information on July 9, which was answered by LATAM Airlines Brasil on July 25, 2024.
LATAM Airlines Brazil is cooperating with the authority and maintains its commitment to transparency and
compliance with all applicable laws and regulations.
7) Brazilian consumer authorities sent three official letters to LATAM Airlines Brazil in August and September
2024 requesting information on the crash of a Voepass airplane. LATAM Airlines Brazil has a code-share
agreement with Voepass. The company answered those letters properly by the deadline. The National Consumer
Secretariat decided to archive the procedure due to the sufficiency of the responses presented by the company.
The procedures before the Consumer Defense Institute of the State of Paraná (PROCON PR) and the State of
million) and individually for LATAM Airlines Group S.A. and TAM Linhas Aéreas S.A. (with a minimum
combined level of US$400 million).
On October 15, 2024, LATAM Airlines Group S.A. received the funds from its issuance of secured bonds at
7.875% maturing in 2030 (“2030 Notes,” together with the 2029 Notes, the “Notes”) for a total principal
amount of US$1.4 billion. The Exit RCF and the Notes share the same intangible collateral, consisting primarily
of the FFP business (LATAM Pass loyalty program), the cargo business, certain slots, gates, and routes, as well
as intellectual property and LATAM trademarks. Additionally, the agreements include a minimum liquidity
covenant requiring the Company to maintain a minimum liquidity level, measured at the consolidated level of
the Company (LATAM Airlines Group S.A.), of US$750 million. The funds received were used to repay the
Term Loan B and part of the 2027 Notes.
On November 4, 2024, LATAM Airlines Group S.A., acting through its Florida branch, entered into a new four-
year revolving credit facility, secured by spare engines (“Spare Engine Facility”), with, among other
institutions, Crédit Agricole Corporate and Investment Bank as loan agent, for a total amount of US$300
million, of which US$275 million was drawn on the same day, leaving US$25 million available for the
Company when required. The loan included minimum liquidity covenants measured at the consolidated level of
the Company (with a minimum level of US$750 million) and individually for LATAM Airlines Group S.A. and
TAM Linhas Aéreas S.A. (with a combined minimum level of US$400 million). The funds received were used
to fully repay the previous spare engine financing. Finally, this issuance was linked to sustainability
(“Sustainability-Linked”), which entails a commitment to reducing CO2 emissions intensity from March 2025
until the maturity of the facility. Compliance or non-compliance with these targets does not result in
acceleration of the credit but instead applies a reward or penalty, respectively, on the interest rate.
As of December 31, 2024, the Company complies with the aforementioned minimum liquidity covenants.
b)
Other commitments
As of December 31, 2024, the Company maintains valid letters of credit, guarantee notes and guarantee
insurance policies, according to the following detail:
SUPERINTENDENCIA NACIONAL DE ADUANAS
Y DE ADMINISTRACION TRIBUTARIA
LATAM Airlines Perú
S.A.
50
Letter of Credit
217,753
Jan 5, 2025
SÉTIMA TURMA DO TRIBUNAL REGIONAL
FEDERAL DA 1ª REGIÃO - PROCEDIMENTO
COMUM CÍVEL - DECEA -
0012177-54.2016.4.01.3400
TAM Linhas Aereas
S.A. / ABSA
Aerolinhas Brasileiras
S.A.
2
Guarantee
Insurance
48,483
Apr 20, 2025
ISOCELES
LATAM Airlines
Group S.A.
1
Letter of Credit
41,000
Dec 1, 2025
UNIÃO FEDERAL - PGFN
TAM Linhas Aereas
S.A. / ABSA
Aerolinhas Brasileiras
S.A.
21
Guarantee
Insurance
170,588
Apr 14, 2025
TRIBUNAL DEJUSTIÇADOESTADODABAHIA
TAM Linhas Aereas
S.A.
1
Guarantee
Insurance
5,216
Jun 27, 2029
VARA DAS EXECUÇÕES FISCAIS ESTADUAIS
DE SÃO PAULO - FORO DAS EXECUÇÕES
FISCAIS DE SÃO PAULO
TAM Linhas Aereas
S.A.
2
Guarantee
Insurance
9,460
Mar 4, 2025
AMERICAN ALTERNATIVE INS. CO. C/O
ROANOKE INS. GROUP INC
LATAM Airlines
Group S.A.
23
Letter of Credit
7,457
Feb 1, 2025
TRIBUNAL DE JUSTIÇA DO ESTADO DE SÃO
PAULO
ABSA Aerolinhas
Brasileiras S.A.
2
Guarantee
Insurance
6,040
Dec 31, 2999
BBVA
LATAM Airlines
Group S.A.
1
Letter of Credit
3,800
Jan 23, 2025
1° VARA DE EXECUÇÕES FISCAIS E DE CRIMES
CONTRA A ORDEM TRIB DA COM DE
FORTALEZA
TAM Linhas Aereas
S.A.
1
Guarantee
Insurance
2,816
Dec 31, 2999
ARQUITETURA DE PROTEÇÃO E DEFESA DO
CONSUMIDOR DO ESTADO DO RJ
TAM Linhas Aereas
S.A.
1
Guarantee
Insurance
1,148
Dec 31, 2999
13ª VARA FEDERAL DA SEÇÃO JUDICIÁRIA DO
DISTRITO FEDERAL/DF
TAM Linhas Aereas
S.A.
1
Letter of Credit
1,780
Dec 31, 2999
Creditor Guarantee
Debtor
Quantity
Type
Value
ThUS$
Release
Date
› 365
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
São Paulo (PROCON SP) are still ongoing. LATAM Airlines Brazil also received an official letter from the
Office of the Public Prosecutor on August 12, 2024, which it answered on August 27, 2024. On September 5,
2024, the Prosecutor's Office issued a decision to separate the procedure into three specific topics: (1) security
matters, in which LATAM Airlines Brasil is not a party; (2) consumer matters, with two representations filed;
and (3) compensation matters, which will be closed due to the Reparation Program (PR 2283).
IV. CMF Research Unit Result
On December 19, 2024, through Exempt Resolution No. 12095, the Financial Market Commission (CMF)
informed LATAM Airlines Group S.A. of the application of Censure, as a result of the investigation process
initiated in August of that year due to delays of only 9 hours and 38 minutes in relation to the deadlines
established by General Regulation (NCG) 30 issue by the regulatory entity for the submission of the XBRL file
for the financial statements corresponding to the third quarter of 2020, the date on which the Company was in
its reorganization process under Chapter 11, as a result of the pandemic.
.
NOTE 31 - COMMITMENTS
(a)
Commitments arising from loans
In relation to certain contracts committed by the Company for the financing of the Boeing 777 aircraft, which
are guaranteed by the Export – Import Bank of the United States of America, limits have been established for
some financial indicators of LATAM Airlines Group S.A. on a consolidated basis. Under no circumstance does
non-compliance with these limits generate loan acceleration.
The Company and its subsidiaries do not have credit agreements that impose limits on financial indicators of the
Company or its subsidiaries, with the exception of those detailed below:
On July 15, 2024, LATAM Airlines Group S.A., acting through its Florida branch, amended, increased and
extended the 2022 revolving credit facility (“Exit RCF”) from US$500 million to US$750 million with a
consortium of nine banks led by JP Morgan Chase Bank, N.A. As of December 31, 2024, this credit facility is
undrawn and fully available. Additionally, LATAM Airlines Group S.A., together with Professional Airline
Services Inc., a Florida corporation and wholly owned subsidiary of LATAM Airlines Group S.A., issued: (i) on
October 12, 2022, as amended on November 3, 2022, a five-year loan (“Term Loan B”) for US$1.1 billion (on
October 15, 2024, this loan was fully repaid), (ii) on October 18, 2022, senior secured notes at 13.375%
maturing in 2027 (“2027 Notes”) for a total principal amount of US$450 million (on October 15, 2024, this loan
was fully repaid), and (iii) on October 18, 2022, senior secured notes at 13.375% maturing in 2029 (“2029
Notes,” together with the 2027 Notes, the “Notes”) for a total principal amount of US$700 million. The Exit
RCF, the Term Loan B, and the Notes (collectively, the “Exit Financing”) share the same intangible collateral,
consisting primarily of the FFP business (LATAM Pass loyalty program), the cargo business, certain slots,
gates, and routes, as well as intellectual property and LATAM trademarks. The Exit Financing contains certain
covenants that limit the ability of the Company and its subsidiaries to, among other things, make certain types
of restricted payments, incur debt or liens, merge or consolidate with others, dispose of assets, enter into certain
affiliate transactions, engage in certain business activities, or make certain investments. Additionally, the
agreements include a minimum liquidity covenant requiring the Company to maintain a minimum liquidity
level, measured at the consolidated level of the Company (LATAM Airlines Group S.A.), of US$750 million.
On July 15, 2024, LATAM Airlines Group S.A., acting through its Florida branch, amended, increased and
extended the 2016 revolving credit facility (“RCF”) with a consortium of nine financial institutions led by
Citibank, N.A., guaranteed by aircraft, engines and spare parts for a total committed amount from US$600
million to US$800 million. The RCF includes restrictions of minimum liquidity measured at the consolidated
Company level (with a minimum level of US$750 million) and measured individually for LATAM Airlines
Group S.A. and TAM Linhas Aéreas S.A. (with a minimum level of US$400 million). Compliance with these
restrictions is a prerequisite for drawing under the line; if the line is used, compliance with said restrictions must
be reported periodically, and non-compliance with these restrictions may trigger an acceleration of the loan. As
of December 31, 2024, this line of credit is undrawn and fully available.
On November 3, 2022, LATAM Airlines Group S.A., acting through its Florida branch, entered into a five-year
loan agreement (“Spare Engine Facility”) with, among other institutions, Crédit Agricole Corporate and
Investment Bank, acting through its New York branch as loan agent, secured by spare engines for a principal
amount of US$275 million. As of November 4, 2024, this loan was fully repaid. The loan included minimum
liquidity covenants measured at the consolidated level of the Company (with a minimum level of US$750
14ª VARA FEDERAL DA SEÇÃO JUDICIÁRIA DO
DISTRITO FEDERAL / TRIBUNAL: 7ª TURMA
DO TRIBUNAL REGIONAL FEDERAL DA 1ª
REGIÃO - ANULATÓRIA N.º
0007263-25.2008.4.01.3400
TAM Linhas Aereas
S.A.
1
Guarantee
Insurance
1,627
May 29, 2025
JFK INTERNATIONAL AIR TERMINAL LLC
LATAM Airlines
Group S.A.
1
Letter of Credit
2,300
Jan 27, 2025
METROPOLITAN DADE CONTY (MIAMI - DADE
AVIATION DEPARTMENT)
LATAM Airlines
Group S.A.
5
Letter of Credit
3,649
Mar 13, 2025
SOCIEDAD CONCESIONARIA NUEVO
PUDAHUEL S.A.
LATAM Airlines
Group S.A.
19
Letter of Credit
2,599
Mar 27, 2025
FUNDACAO DE PROTECAO E DEFESA DO
CONSUMIDOR PROCON
TAM Linhas Aereas
S.A.
11
Guarantee
Insurance
19,214
Nov 17, 2025
BOND SAFEGUARD INSURANCE COMPANY
TAM Linhas Aereas
S.A.
1
Guarantee
Insurance
2,700
Jul 20, 2025
LIMA AIRPORT PARTNERS S.R.L.
LATAM Airlines
Group S.A.
20
Letter of Credit
4,295
Feb 12, 2025
JUIZO DE DIREITO DA VARA DA FAZENDA
PUBLICA ESTADUAL DA COMARCA DA
CAPITAL DO ESTADO DO RIO DE JANEIRO
TAM Linhas Aereas
S.A.
1
Guarantee
Insurance
1,240
Dec 31, 2999
MUNICIPIO DO RIO DE JANEIRO
TAM Linhas Aereas
S.A.
2
Guarantee
Insurance
1,472
Dec 31, 2999
AENA AEROPUERTOS S.A
LATAM Airlines
Group S.A.
3
Letter of Credit
2,412
Nov 15, 2025
CORPAC S.A.
LATAM Airlines Perú
S.A.
22
Letter of Credit
4,623
Jan 29, 2025
CITY OF LOS ANGELES, DEPARTMENT OF
AIRPORTS
LATAM Airlines
Group S.A.
7
Letter of Credit
1,810
Feb 6, 2025
Total
563,482
Creditor Guarantee
Debtor
Quantity
Type
Value
ThUS$
Release
Date
Letters of credit related to right-of-use assets are included in Note 16 Property, plant and equipment letter (d)
Additional information Property, plant and equipment, in numeral (i) Property, plant and equipment delivered as
collateral.
› 366
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
NOTE 32 - TRANSACTIONS WITH RELATED PARTIES
(a)
Details of transactions with related parties as follows:
Tax No.
Related party
Nature of
relationship with
related parties
Country
of origin
Nature of related parties
transactions
Currency
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
96.810.370-9
Inversiones Costa
Verde S.A.
Related director
Chile
Tickets sales
CLP
142
124
78.180.506-1
Inversiones Costa
Verde Ltda. y CPA.
Related director
Chile
Dividends
CLP
(2)
—
76.183.853-9
Costa Verde
Inversiones Financieras
S.A.
Related director
Chile
Tickets sales
CLP
16
—
Dividends
CLP
(1,904)
—
81.062.300-4
Costa Verde
Aeronautica S.A.
Common
shareholder
Chile
Dividends
CLP
(6,870)
—
Foreign
Inversora Aeronáutica
Argentina S.A.
Related director
Argentina
Real estate leases received
ARS
(5)
(59)
Expense recovery
ARS
—
3
Foreign
Qatar Airways
Indirect shareholder
Qatar
Interlineal received service
US$
(22,863)
(22,107)
Interlineal provided service
US$
32,092
31,020
Services received of handling
US$
(88)
(252)
Services provided of
handling
US$
1,058
—
Services received miles
US$
(10,103)
(4,657)
Services provided miles
US$
2,783
1,683
Dividends
US$
(17,512)
—
Services provided VIP
lounge
US$
—
—
Services provided / received
others
US$
776
1,424
Foreign
Delta Air Lines, Inc.
Shareholder
U.S.A
Interlineal received service
US$
(319,499)
(144,239)
Interlineal provided service
US$
213,153
127,145
Services received miles
US$
(15,795)
(11,069)
Services provided miles
US$
8,335
7,328
Joint venture
US$
(10,000)
(10,000)
Services received of handling
US$
(7,058)
(3,657)
Services provided
maintenance
US$
995
—
Real estates leases provided
US$
155
86
Dividends
US$
(17,535)
—
Services provided VIP
lounge
US$
1,756
640
Services provided / received
others
US$
(22)
344
The balances corresponding to Accounts receivable and accounts payable to related entities are disclosed in
Note 9.
Transactions between related parties have been carried out under market conditions and duly informed.
(b)
Compensation of key management
The Company has defined for these purposes that key management personnel are the executives who define the
Company’s policies and macro guidelines and who directly affect the results of the business, considering the
levels of Vice-Presidents, Chief Executives and Senior Directors.
For the year ended December
31,
2024
2023
ThUS$
ThUS$
Remuneration
12,354
12,815
Board compensation
1,786
1,429
Non-monetary benefits
423
606
Short-term benefits
17,483
13,604
Termination benefits (*)
1,341
59
Total
33,387
28,513
In accordance with current legislation, the Ordinary Shareholders’ Meeting held on April 20, 2023, determined
the amount of the annual remuneration for the Board for the period from that date until the next Ordinary
Shareholders’ Meeting scheduled to take place within the first quarter of 2024. In this context, in addition to the
base remuneration, an additional remuneration was approved for each Board member, with an incremental
amount based on the following criteria:
(a)
During the first year following their appointment, until November 15, 2023, provided that the Director
serves continuously in their position, each Director will be entitled to receive an additional amount to the base
remuneration, equivalent to 9,226,234 units of remuneration or “URAs.”
(b)
For the second year following their appointment, covering the period from the end of the first
anniversary since their designation until November 15, 2024, under the same condition mentioned previously
and approved by the Ordinary Shareholders’ Meeting in the first quarter of 2024, each Director will be entitled
to receive another additional amount equivalent to 9,226,234 URAs.
(c)
Likewise, each Director who becomes part of the Board Committee will also receive, as additional
compensation, a variable amount equivalent to an additional one-third (1/3) calculated on the incremental
remuneration that the respective Committee member is entitled to as a Director, in accordance with the
resolution of the Ordinary Shareholders’ Meeting.
For payment purposes, the value of each URA will be considered as referentially equivalent to the price of a
company’s share. Consequently, URAs will be paid at the weighted average price of stock market transactions
of the company’s shares during the 10 business days preceding the effective date (“Weighted Average Price”).
For the calculation of the Weighted Average Price, transactions on national stock exchanges, as well as those on
foreign exchanges recognized at the national level where LATAM’s American Depositary Shares may
eventually be listed again, will be taken into account.
› 367
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
The amounts paid for this concept, in accordance with the above, are:
Paid during the year
2024
2023
ThUS$
ThUS$
URAs Directors
763
481
URAs Board Committee
85
53
Total
848
534
NOTE 33 - SHARE-BASED PAYMENTS
(a) LP3 compensation plans (2020-2023)
The Company implemented a program for a group of executives, which existed until March 2023, with a
demand period between October 2020 and March 2023, where the collection percentage was annual and
cumulative. The methodology is an estimate of the number of units, where a goal of the value of the action is
set.
The benefit is vested if the target of the share price defined in each year is met. In case the benefit accumulates
up to the last year the total benefit is doubled (in case the share price is achieved).
This Compensation Plan was finally not executed because the share price required for its collection is below the
initial target.
(b) CIP (Corporate Incentive Plan)
As indicated in Note 22, in the context of the exit from Chapter 11 Proceedings, the Company implemented a
talent retention program for the Company's employees, which is divided into three categories. The first one (i.e.,
Non-Executive Employees) simply contemplates guaranteed payments in cash to the respective employees on
certain dates depending on the country where the employee is hired. On the other hand, the remaining two
categories (i.e., Non-GEM Executives and GEM Executives) contemplated the granting of synthetic units of
remuneration (the "Units") that, by reference, are considered as equivalent to the price of one share of LATAM
Airlines Group S.A. and consequently, in case they become effective, grant the worker the right to receive the
payment in cash that results from multiplying the number of Units that are pay for the value per share of
LATAM Airlines Group S.A. that must be considered in accordance with the CIP.
Below are more details of these two categories.
Non-GEM Executives
The first subprogram applies to senior executives not part of the GEM (Global Executive Meeting - Senior
Managers, Managers, Deputy Managers). In this context, this program contemplates two different bonuses: (1)
a retention bonus, consisting of the amount in money resulting from Units that are assigned to the respective
employee and these Units being paid 20% on month 15 and 80% at month 24, in each case, counted from Exit
date from the Chapter 11 Procedure (i.e., November 3, 2022) (the "Exit Date"). This is consequently, a
guaranteed payment for these employees; and (2) a bonus associated to the performance defined on based on the
compliance of certain financial indicators of LATAM Airlines Group S.A. and its subsidiaries, which is
reflected in Note 19(b), becoming effective 20% at month 15 and 80% at month 24, in each case, from the Exit
Date. Consequently, this is a temporary payment that is only made if these indicators are met.
GEM Executives
Applies to senior executives of the Company who are part of the GEM (CEO and employees whose job
description is "vice presidents" or "directors"). Employees that participating in this program are eligible to
receive cash payments for Units. These Units are as follows:
1. "RSUs" (Retention Shares Units): That is, Units associated with the employee's permanence in
the Company, and consequently, are associated with the passage of time. In its totality, the CIP contemplates up
to 3,107,603,293 RSUs which are made effective by partialities in the terms indicated below.
As a general rule, RSUs will be eligible to become effective at the rate of one third on each of
the following dates: month 24, month 36 and month 42, in each case, counted from the Exit Date. The
mentioned above, subject to the occurrence of a trigger event related to the volume of transactions of securities
issued by LATAM Airlines Group S.A. in the terms contemplated in the CIP (hereinafter, a "VTE" – Volume
Triggering Event). The number of RSUs actually paid will be determined based on the net resources
accumulated as a result of a VTE on the respective determination date (hereinafter, this adjustment will be
referred to as the "Pro Rata Factor").
Notwithstanding the mentioned above, the CIP also contemplates a "Minimum Guaranteed Vesting" according
to which, the percentage of RSUs indicated below will be effective on each date indicated, even if a VTE has
not occurred. The foregoing, net of the RSUs that may eventually have become effective previously.
Minimum Guaranteed Vesting of RSUs
Percentage of
Units that become
effective
Month 30 from Exit Date
20%
Month 42 from Exit Date
30%
Month 60 from Exit Date
50%
2. "PSUs" (Performance Shares Units): That is, Units associated with both the employee's
permanence in the Company and the performance of LATAM Airlines Group S.A. measured according to the
share price. Consequently, like RSUs, these Units are associated with the passage of time. However, PSUs also
consider the market value of the share of LATAM Airlines Group S.A. considering a liquid market. However,
as long as there is no such liquid market, the share price will be determined on the basis of representative
transactions. In its totality, the CIP contemplates up to 4,251,780,158 PSUs which are made effective by
partialities in the terms indicated below.
As a general rule, PSUs will be eligible to become effective at the rate of one third on each of the following
dates: month 24, month 36 and month 42, in each case, counted from the Exit Date. The foregoing, subject to (i)
a VTE having occurred; and (ii) that the quotient (hereinafter, the "Net Price/ERO (Equity Rights offering)
Quotient") between the net price of sales originating in a VTE, divided by the price of share at which the shares
issued were placed under the capital increase agreed at the extraordinary shareholders' meeting of LATAM
Airlines Group S.A. dated July 5, 2022 (that is, US$0.01083865799), is greater than 150%. The number of
PSUs that actually becomes effective will be determined according to the Factor Pro Rata and the Quotient Net
Price/ERO Price).
From the above it flows that the PSUs constitute an eventual and not guaranteed payment.
In addition, some of the GEM Executives will also be entitled to receive a fixed and guaranteed payment in cash
("MPP" – Management Protection Plan) on certain dates under the Plan, at the rate of 33% in the month 18,
34% in the month 24 and 33% in the 30th month, all from the Exit Date. On the other hand, those employees
who are eligible for this MPP will also be eligible for a limited number of additional RSUs ("MPP Based
RSUs"). In its totality, the CIP includes 1,438,926,658 MPP based RSUs. As a general rule, MPP Based RSUs
will be eligible to become effective on the same terms and conditions as RSUs; however, that they will be
eligible to become effective at a rate of one third on each of the following dates: month 18, month 24 and month
› 368
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
30, in each case, from the Exit Date. The valuation of these Units will be equivalent to the value of the
Company's share less the ERO Price at the time they become effective.
In all cases, the respective employees must have remained as such in the Company at the corresponding accrual
date to qualify for these benefits.
Given the characteristics of this program, it has been recorded in accordance with the provisions of IFRS 2
"Share-based payments" and has been considered as a "cash settlement award" and, therefore, recorded at fair
value as a liability that is part of the items Trade and other accounts payables and Provisions for employee
benefits, non-current, which is updated at the closing date of each financial statement with effect on profit or
loss for the period and classified in the line "Administrative expenses" of the Consolidated Statement of Income
by function.
The fair value has been determined on the basis of the current share price and the best estimate of the future
value of the Company's share, multiplied by the number of underlying units granted. This estimate was made
based on the Company's Business Plan and its main indicators such as EBITDAR, adjusted net debt.
The movement of units as of December 31, 2023 and December 31, 2024 , is as follows:
Opening balance
as of 01.01.2023
Granted during the
period
Vested
Exercised
during the
period
Forfeited
during the
period
Closing
balance as of
December 31,
2023
RSU - Retention
—
3,107,603,293
—
— (121,146,360) 2,986,456,933
PSU - Performance
—
4,251,780,158
—
— (242,192,091) 4,009,588,067
MPP BASED RSU -
Protection
—
1,438,926,658
—
— (192,047,245) 1,246,879,413
Total
—
8,798,310,109
—
— (555,385,696) 8,242,924,413
Opening balance
as of 01.01.2024
Granted during the
period
Vested
Exercised
during the
period
Forfeited
during the
period
Closing
balance as of
December 31,
2024
RSU - Retention
2,986,456,933
35,468,268
— (692,032,415)
(91,282,871) 2,238,609,915
PSU - Performance
4,009,588,067
42,034,943
—
—
(89,352,930) 3,962,270,080
MPP BASED RSU -
Protection
1,246,879,413
—
—
—
(60,388,760) 1,186,490,653
Total
8,242,924,413
77,503,211
— (692,032,415) (241,024,561) 7,387,370,648
NOTE 34 - STATEMENT OF CASH FLOWS
(a)
The Company has carried out the following transactions with non-monetary impact transactions
mainly related to financial lease and lease liabilities, which are described in Note 19 Other financial
liabilities.
(b)
Other inflows (outflows) of cash:
For the year ended December 31,
2024
2023
ThUS$
ThUS$
Restricted Advances
—
20,572
Bank commissions, taxes paid and other
(3,355)
(2,173)
Taxes on financial transactions
(10,563)
(6,803)
Guarantees
73,074
4,406
Judicial deposits
54,356
(16,349)
Fuel derivatives and currency
31,853
30,413
Derivative margin guarantees
10,902
(2,559)
Payment for derivatives premiums
(43,902)
(47,853)
Insurance recovery
9,788
—
Total Other inflows (outflows) Operation activities
122,153
(20,346)
Recoveries of credits and Guarantee deposit received from the sale of
aircraft
34,469
48,258
Insurance recovery
—
11,000
Recoveries of credits received
—
Total Other inflows (outflows) Investment activities
34,469
59,258
Interest rate derivatives
1,456
15,934
Taxes on financial transactions
—
(4,529)
Others recovery
510
—
Costs associated with financing
(64,146)
Withholding tax
(11,689)
—
Total Other inflows (outflows) Financing activities
(73,869)
11,405
(c)
Dividends:
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
Latam Airlines Group S.A.
(174,549)
—
Transportes Aéreos del Mercosur S.A. (*)
(289)
—
Total dividends paid
(174,838)
—
(*) Dividends paid to minority shareholders
› 369
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(d)
Reconciliation of liabilities arising from financing activities:
Cash flows
Non cash-Flow
Movements
Obligations with financial
institutions
As of
December
31, 2023
Obtainment
Payment
Interest
accrued and
others
As of
December 31,
2024
Capital (*)
Capital (**)
Interests
Other flow
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Bank loans
1,029,434
—
(1,089,000) (167,026)
—
226,592
—
Guaranteed obligations
303,922
99,000
(28,938)
(19,908)
—
19,967
374,043
Other guaranteed
obligations
430,350
272,112
(330,870)
(39,066)
—
42,225
374,751
Obligation with the public
1,302,838
1,378,948
(450,000) (156,862)
(10,870)
175,249
2,239,303
Financial leases
901,546
—
(105,734)
(46,596)
—
50,557
799,773
Other loans
104
—
—
—
—
(104)
—
Lease liability
2,967,994
—
(344,038) (288,176)
—
1,026,801
3,362,581
Total Obligations with
financial institutions
6,936,188
1,750,060
(2,348,580) (717,634)
(10,870)
1,541,287
7,150,451
Cash flows
Non cash-Flow Movements
Obligations with financial
institutions
As of
December
31, 2022
Obtainment
Payment
Interest
accrued and
others
Reclassifications
As of
December 31, 2023
Capital (*)
Capital (**)
Interests
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Bank loans
1,385,995
—
(81,952) (153,791)
189,272
(310,090)
1,029,434
Guaranteed obligations
325,061
—
(19,726)
(20,309)
20,686
(1,790)
303,922
Other guaranteed
obligations
474,304
—
(56,519)
(42,283)
43,037
11,811
430,350
Obligation with the public
1,289,799
—
—
(155,655)
168,694
—
1,302,838
Financial leases
1,088,239
—
(183,374)
(48,272)
58,076
(13,123)
901,546
Other loans
2,028
—
(434)
—
(70)
(1,420)
104
Lease liability
2,216,454
—
(225,358) (173,924)
1,150,822
—
2,967,994
Total Obligations with
financial institutions
6,781,880
—
(567,363) (594,234)
1,630,517
(314,612)
6,936,188
(*) During the year 2024 the Company obtained ThUS$1,750,060 imports from long-term loans. For the year
2023, the Company did not obtain financing.
(**) As of December 31, 2024, under the cash flows from financing activities are presented loan repayments of
ThUS$2,004,542 and payments of lease liabilities of ThUS$344,038 (ThUS$342,005 and ThUS$225,358,
respectively as of December 31, 2023).
Below are the details obtained (payments) of flows related to financing:
For the year ended
December 31,
2024
2023
Capital
raising
Payments
Capital
raising
Payments
Flow of
Capital
Interest
Capital
Interest
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
ThUS$
Aircraft financing
99,000
(198,774)
(69,249)
—
(251,388)
(76,497)
Lease liability
—
(344,038)
(288,176)
—
(225,358)
(173,924)
Non-aircraft financing
1,651,060 (1,805,768)
(360,209)
—
(90,617)
(343,813)
Total obligations with Financial
institutions
1,750,060 (2,348,580)
(717,634)
—
(567,363)
(594,234)
(e)
Advances of aircraft and engines
Corresponds to the cash flows associated with aircraft and engines purchases, which are included in the
statement of consolidated cash flows, within Purchases of property, plant and equipment.
For the year ended December 31,
2024
2023
2022
ThUS$
ThUS$
ThUS$
Increases (payments)
(219,010)
(142,782)
(23,118)
Recoveries
34,379
215,362
3,037
Total cash flows
(184,631)
72,580
(20,081)
(f)
Additions of property, plant and equipment and Intangibles
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
Net cash flows from
Purchases of property, plant and equipment
1,325,463
795,787
Additions associated with maintenance
358,475
337,126
Other additions
966,988
458,661
Purchases of intangible assets
94,412
68,052
Other additions
94,412
68,052
› 370
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
(g)
The net effect of the application of hyperinflation in the consolidated cash flow statement corresponds
to:
For the year ended
December 31,
2024
2023
ThUS$
ThUS$
Net cash flows from (used in) operating activities
6,256
(47,569)
Net cash flows from (used in) investment activities
819
3,661
Effects of variation in the exchange rate on cash and cash equivalents
(7,075)
43,908
Net increase (decrease) in cash and cash equivalents
—
—
(h)
Payments of leased maintenance
Payments to suppliers for the supply of goods and services include the value paid associated with leased
maintenance capitalizations for ThUS$246,429 (ThUS$294,549 as of December 31, 2023).
NOTE 35 - THE ENVIRONMENT
LATAM Airlines Group S.A is committed to sustainable development, seeking to generate social, economic,
and environmental value for the countries where it operates and for all its stakeholders. The Group manages
socio-environmental matters at a corporate level, centralized in the Corporate Affairs and Sustainability
Department. The Group is committed to monitoring and mitigating its impacts on the environment in all its
ground and air operations, being a key element in the solution, and searching for alternatives to the challenges
of the company and its environment.
The main functions of Corporate Affairs and Sustainability Department in environmental matters, together with
the various areas of the company, include ensuring compliance of legal environmental regulations in all the
countries, implementing and maintaining a corporate environmental management system, the efficient use of
non-renewable resources such as aircraft fuel, implement measures for the valorization and diversion of landfill
waste, and the development of programs and actions that allow it to reduce its greenhouse gas emissions,
seeking to generate environmental social and economic benefits for the company and the countries where it
operates.
LATAM's sustainability strategy that was launched in 2021 is based on 4 pillars: Environmental Management
System, Climate Change Management, Circular Economy and Shared Value. With these pillars, the company
seeks to generate social, environmental and economic value for society and the company, anticipating the risks
inherent in the sustainability challenges which are viewed by the current and future scenarios.
The aspects addressed in each pillar within the strategy are presented below:
Environmental Management
To safeguard environmental regulatory compliance with the different regulations applicable to LATAM group
operations, the company has strengthened the operation of its environmental management system, turning it into
a preventive tool that allows it to respond in an agile and planned manner to an internal and external context.
dynamic in regulatory matters, allowing it to adopt good industry practices and improve its environmental
performance.
In October 2024, we re-certified the Miami Cargo base under ISO 140001:2015 standard. The scope of this
certification is Air cargo transportation services and the maintenance of its aircraft in Miami. LAN CARGO
EMS activities include ORG (Corporate and Administrative activities); GRH (Ground Activities); MNT
(Maintenance activities); CGO (Cargo and Warehouse activities); and SEC (Security, Safety, and
Environmental activities).
Climate Change Management
Aiming to manage its carbon footprint and to contribute to the preservation and conservation of some of the
region’s key ecosystems, LATAM seeks to advance in its Net Zero roadmap in a sustainable manner with the
environment, the communities it serves and with the business, for which it bases its strategy on the following
fronts:
Efficient Operation: Through LATAM Fuel Efficiency, LATAM’s corporate fuel efficiency program that
considers initiatives in all areas of the company that aim to reduce fuel consumption.
Sustainable Aviation Fuels (SAF): Given the importance of SAF to mitigate climate change in the long term,
LATAM is working towards creating the enabling conditions in the region to foster the development of SAF.
For this, it co.-financed, together with Airbus, an independent study conducted by the Massachusetts Institute of
Technology (MIT) with the objective of creating public policy recommendations that contribute to the
industry’s decarbonization. The Group is focused on exploring opportunities in Brazil and Colombia, which
have proven experience in the biofuels industry; and Chile, a country with high potential for green hydrogen
development.
New Technologies: Renewing the fleet by incorporating the latest generation of aircrafts contributes to the
reduction of emissions, given that, according to the manufacturer’s data, new generation aircrafts consume
between 20 and 25% less fuel compared to previous generations.
Emissions offsetting: LATAM has a comprehensive commitment to the environment and thus has established
strategic partnerships that will allow, not only to acquire carbon credits as a complementary measure to offset
emissions, but also to contribute to the preservation and conservation of strategic ecosystems in the region.
With this fronts and initiatives, the Group focuses on scope 1 emissions reductions, or in other words, on
reducing the amount of carbon dioxide emissions per passenger/ton transported, prioritizing reduction over
offsetting..
During 2024, LATAM announced its first sustainability linked financing, subscribing to USD$ 300 million
credit, under which it can receive price adjustment based on its performance in relation to its carbon dioxide
emissions intensity measured as tons of CO2 emissions / revenue per ton-kilometer (RTK).
Circular Economy
LATAM has outlined its roadmap by promoting a circular economy from the design of its materials and
processes to the reduction and valorization of its waste, considering differentiated actions according to the type
of operation and material.
By the end of 2024, LATAM achieved the elimination of 97% of single-use plastics from its operations,
equivalent to more than 1,738 tons. The remaining 3% corresponds to items not replaced due to legal, sanitary,
or operational restrictions.
Additionally, an evaluation of the valorization potential was developed in the main operations of Santiago
(Chile), Sao Carlos (Brazil), and Bogotá (Colombia) to estimate the technical limit of waste valorization, and
continued strengthening the waste management systems in Chile and Brazil.
Our Lounge at Santiago de Chile airport generates 455 tons of waste in one year, and LATAM managed to
recycle 76%, which includes composting orange peels, uneaten passenger food, and organic kitchen waste,
among others.
Regarding the “Recicla tu Viaje” program present on domestic flights in our network, we expanded the scope of
recycling to include Tetra Pak in Chile and Brazil. With this, the LATAM group managed to recycle more than
280 tons of waste from our flight operations. This figure includes the recycling of PET plastic bottles from
water and soft drinks in BR, CL, CO, EC, and PE, and Tetra Pak from juice and dairy cartons used on domestic
flights in Brazil and Chile, a 64% improvement over 2023. Additionally, for the second consecutive year, we
received the Onboard Hospitality magazine award for Sustainable Onboard Service for the "Recicla Sua
Viagem" program in Brazil (114 tons of PET bottles in 2023).
On our onboard service, we significantly reduced fresh food waste by implementing artificial intelligence. This
system helps us more accurately predict the amount of food we need to load on each flight, thus avoiding excess
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catering. Since its implementation, this excess has been reduced by more than 60%, preventing the waste of
more than 200,000 fresh food services.
Regarding our cargo operations in Chile, this year we implemented high-density red plastic pallets. These
pallets replace traditional wooden and conventional plastic pallets, improving operational efficiency due to their
greater durability.
Finally, the Segundo Vuelo Perú program was awarded by Corresponsables in Spain. Segundo Vuelo, a
program present in Chile, Brazil, Peru, Colombia, Ecuador, and Paraguay, collaborates with local communities
that receive discarded LATAM uniforms to transform them into new products. This initiative not only reduces
the environmental impact of textile waste but also contributes to the sustainable development of communities,
job creation, and responsible consumption.
Shared Value
The "Solidarity Plane" program stands out regarding shared value creation. It was created in 2011, and through
it, LATAM provides society with its structure, connectivity, passenger, and cargo transportation free of charge
to support the needs of the region. The program operates in three areas.
Health Solidary Plane: On disposition for the community, to serve as an aerial bridge to provide support to
different necessities of well-being and health of the region. Focus on the patient, health professional and
medical supplies transportation.
Environmental Solidary Plane: flora and fauna transportation for its conservation, transportation of scientists
and members of environmental institutions that travel to guard the region's ecosystem. Support is also provided
in transferring waste from islands to Latin America mainland.
Natural Disaster Solidary Plane: transportation of humanitarian aid in response to floods, fires, earthquakes,
tsunamis and volcanic explosions.
In 2024 we worked with 47 organizations in South America resulting in the transportation of 4877 passengers
and 744 tonnes of humanitarian cargo.
Finally, as part of the strength program search, the development of a methodology to measure the social and
environmental program impact (Social Return Investment) was incorporated.
Corporate Sustainability Assessment (CSA) of S&P Global
Globally, LATAM is the fifth airline with the best performance in sustainability according to the corporate
sustainability Assessment (CSA) of S&P Global in December 2024. The international risk rating agency
measures the environmental, social and corporate governance practices of companies.
This allowed us, after five years, to be included again in the Dow Jones Sustainability Index list of Chile and the
MILA Pacific Alliance, which recognizes companies from Chile, Colombia and Peru.
NOTE 36 - EVENTS SUBSEQUENT TO THE DATE OF THE FINANCIAL STATEMENTS
After December 31, 2024 and up to the date of issuance of these financial statements, there is no knowledge of
other events of a financial or other nature that significantly affect the balances or their interpretation.
The consolidated financial statements of LATAM Airlines Group S.A. and Subsidiaries as of December 31,
2024, have been approved in the Extraordinary Session of the Board of Directors on January 30, 2025.
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AFFILIATES AND
SUBSIDIARIES
NCG 519: 6.5.1 SUBSIDIARIAS Y ASOCIADAS
Llanquihue, Chile
During the last financial year, LATAM had commercial
relationships with its subsidiaries in terms of fleet
and services, which are expected to continue through
2025.
The acts and contracts entered into between
LATAM and its affiliates and the results obtained
are presented in detail in the Financial Statements,
including the following:
Technical Training LATAM S.A.: during this financial
year, Technical Training LATAM S.A. rendered technical
training services to LATAM and its subsidiaries.- Lan
Cargo S.A. and affiliates: Lan Cargo S.A. and its
subsidiaries provided services to LATAM related to
aircraft leasing, cargo transportation, crew leasing
and other service rendering contracts. On the other
hand, LATAM provided services to Lan Cargo S.A.
and its affiliates related to aircraft leasing, leasing
of assets, and other services.
Inversiones Lan S.A.: LATAM and Inversiones Lan
S.A. entered into real estate leasing agreements.
Lan Pax Group and affiliates: Lan Pax Group S.A.
and its affiliates provided services to LATAM related
to aircraft leasing, maintenance and other services.
On the other hand, LATAM provided services to Lan
Pax Group S.A. and its affiliates related to aircraft
leasing, maintenance, distribution and other services.
LATAM Airlines Perú S.A.: LATAM Airlines Peru
S.A. provided services to LATAM related to line
maintenance and passenger handling in Peru. On
the other hand, LATAM provided services to LATAM
Airlines Perú S.A. related to aircraft leasing, aircraft
maintenance, and others.
TAM S.A. and affiliates: TAM S.A. and its affiliates
entered into contracts with LATAM for the leasing
of aircraft and engines, and other service rendering
contracts.
LATAM Travel S.R.L.: LATAM Travel S.R.L. provided
tour operator services to LATAM.
LATAM
GROUP
2024
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13 / FINANCIAL STATEMENTS
LATAM Airlines Group S.A.
Name: LATAM Airlines Group S.A.
RUT: 89.862.200-2
Incorporation: It was established as a Limited
Liability Company under the trade name “Línea Aérea
Nacional-Chile Limitada”, via a public deed dated
December 30, 1983 executed at the Notary Office
of Mr. Eduardo Avello Arellano; an excerpt of this
deed is recorded in the Santiago Commerce Registry
on page 20,341 item 11,248 of the year 1983, and
published in the Official Gazette on December 31,
1983.
Pursuant to the public deed dated August 20, 1985,
executed at the Santiago Notary Office of Mr. Miguel
Garay Figueroas Office, the company became a joint-
stock corporation known as Línea Aérea Nacional
Chile S.A. which, by express provision of Law Number
18,400, has the quality of legal follower of the state-
owned company created in the year 1929 under the
name Línea Aérea Nacional de Chile, pursuant to the
aeronautical and radio communications concessions,
traffic rights, and other administrative concessions.
Subsequently, via a public deed dated November
24, 1986, executed at the Santiago Notary Office
of Mr. Mario Baros Gonzalez, the company changed
its name to "Línea Aérea Nacional-Chile S.A.".
Later, via a public deed dated May 15, 1998, executed
at the Santiago Notary Office of Mr. Eduardo Pinto
Peralta, the company's name was changed to "Lan
Chile S.A.".
The Extraordinary Shareholders' Meeting of LAN
Chile S.A. held on July 23, 2004 resolved to change
the name of the company to "LAN Airlines S.A." The
minutes of the Extraordinary Shareholders' Meeting
were reduced to public deed on July 28, 2004, at
the Santiago Notary Office of Mr. Ivan Torrealba
Acevedo. An excerpt of said deed was recorded in
the Real Estate Registry of the Santiago Registry
of Commerce on page 25,128 item 18,764 of the
year 2004 and published in the Official Gazette on
August 21, 2004. The effective date for the trade
name change was September 8, 2004.
The Extraordinary Shareholders’ Meeting of LAN Chile
S.A. held on December 21, 2011, agreed to change
the name of the company to “LATAM Airlines Group
S.A.”. An excerpt of the deed to which the Minutes of
said Meeting referred was recorded in the Santiago
Commerce Registry on page 4,238 item 2,921 of the
year 2012, and published in the Official Gazette on
January 14, 2012. The effective date for the name
change was June 22, 2012.
LATAM Airlines Group S.A. is ruled by the regulation
applicable to open stock companies, and registered
to this effect under number 0306, dated January
22, 1987, in the Securities Register of the Financial
Market Commission (CMF for its Spanish acronym).
Registered address: Presidente Riesco 5711, Las
Condes, Santiago, Chile.
Note: A summary of the affiliates’ Financial Statements
is presented herein. The full information is available to the
public in the offices of LATAM and at the Superintendency
of Securities and Insurance(SVS).
TAM S.A. AND SUBSIDIARIES
Name: TAM S.A.
Incorporation: Joint Stock Corporation established
in Brazil in 1997.
Purpose: To participate as a shareholder in other
companies, particularly those operating scheduled
air transport services on a national and international
level, as well as activities connected, related, and
complementary to scheduled air transport.
Registered address: Rua Ática, 673, andar 6, sala
61, Jardim Brasil. São Paulo, Brazil.
Paid-in Capital: ThUS$4,861,810
Profit for the period: ThUS$673,327
Stake in 2024: 100%
Year over Year Variance (YoY): 0.0%
% of Holding's assets: 9.91471%
Chairman of the Board: Jerome Paul Jacques Cadier
Board Members: Jerome Paul Jacques Cadier
(Chairman and Director without specific designation);
Bruno Macarenco Aléssio (Chief Financial Officer);
and Jefferson Cestari (Director without specific
designation).
TAM S.A. AFFILIATE COMPANIES
TAM Linhas Aereas S.A. and affiliates
Name: TAM Linhas Aéreas S.A.
Incorporation: Joint Stock Corporation established
in Brazil in 1988.
Purpose:
a. The operation of scheduled air transport services
for passengers, cargo, and baggage, pursuant to
existing legislation.
b. The operation of complementary activities of air
transport services from the transport of passengers,
cargo, and baggage.
c. The rendering of maintenance and repair services
for own or third parties’ aircraft, engines, and spare
parts.
d. The rendering of aircraft hangar services.
e. The rendering of yard and runway care services,
provision of the aircraft cleaning staff.
f. The rendering of engineering services, technical
assistance and other activities related to the aviation
industry.
g. The rendering of brokerage services and agency
of services and companies in general, except real
estate.
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13 / FINANCIAL STATEMENTS
h. The performance of instruction and training related
to aeronautical activities.
i. The analysis and development of programs and
systems.
j. The purchase and sale of aeronautical parts,
accessories, and equipment.
k. The development and implementation of other
activities, related to or complementary to aviation,
in addition to those expressly listed above;
l. The import and export of finished lubricating oil.
m. The use of bank correspondents’ services.
n. Storage and deposit of all kinds of solid, liquid
and gaseous products on behalf of third parties.
Registered address: Rua Ática, 673, andar 6, sala
62, Jardim Brasil. São Paulo, Brazil.
Paid-in Capital: ThUS$1,742,044
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 9.99041%
Chairman of the Board: Jerome Paul Jacques Cadier
Board Members: Jerome Paul Jacques Cadier
(Chairman and Director without specific designation);
Bruno Macarenco Aléssio (Chief Financial Officer);
and Jefferson Cestari (Director without specific
designation).
ABSA: Aerolinhas Brasileiras S.A. and affiliate
Name: ABSA Aerolinhas Brasileiras S.A.
Incorporation: Joint Stock Corporation established
in Brazil in 1995.
Purpose:
a. To operate scheduled domestic and international
air transport services for passengers, cargo, and
postal services, pursuant to existing legislation.
b. The operation of auxiliary air transport activities,
such as handling, cleaning, and towing of aircraft,
cargo monitoring, operational flight clearance, check-
in and check-out, and other services provided for in
the corresponding legislation.
c. Commercial and operational leasing, as well as
the transport of aircraft.
d. Operation of maintenance and marketing services
for aircraft parts and equipment.
e. The development and implementation of other
activities, related to or complementary to aviation,
in addition to those expressly listed above.
Registered address: Rodovia Santos Dumont, km
66, S/N, S.V.P lado esquerdo, Viracopos. Campinas,
Brazil.
Paid-in Capital: ThUS$8,187
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: -0.26857%
Chairman of the Board: Jerome Paul Jacques Cadier
Board Members: Jerome Paul Jacques Cadier
(Chairman and Director without specific designation);
Bruno Macarenco Aléssio (Chief Financial Officer);
and Jefferson Cestari (Director without specific
designation).
Transportes Aéreos del Mercosur S.A.
Incorporation: Joint Stock Corporation established
in Paraguay.
Purpose: It has a broad corporate purpose that
includes aeronautical, commercial, tourist, service,
financial, representation, and investment activities,
with a focus on scheduled and charter, domestic and
international, aeronautical transportation activities
for people, objects, and/or correspondence, among
others, as well as commercial and maintenance
and technical assistance services for all types of
aircraft, equipment, accessories, and material for
air navigation, among others.
Registered address: Edificio Torre de las Américas
Piso 8 Oficinas
A y B - Av. República Argentina y Av. Mcal. López.
Asunción, Paraguay.
Paid-in Capital: ThUS$6,603
Stake in 2024: 94.98%
YOY variation: 0.0%
% of Holding's assets: 0.13644%
Chairman of the Board: Enrique Alcaide Hidalgo
Board Members: Enrique Alcaide Hidalgo (Executive),
Esteban Burt Artaza (Regular), Diego Martinez
(Regular) and Augusto Sanabria (Regular)
Managers: Enrique Alcaide Hidalgo, Esteban Burt
Artaza, Diego Martinez and Luis Galeano
Fidelidade Viagens e Turismo S.A.
Incorporation: Joint Stock Corporation established
in Brazil in 2013.
Purpose:
a. Devoted to private and non-private travel agency
and tourism activities, provided in the valid tourism
legislation.
b. Management and operation of tourist activities
for events and leisure.
Registered address: Rua Ática, 673, andar 7, sala
72, Jardim Brasil. São Paulo, Brazil.
Paid-in Capital: ThUS$19,123
Stake in 2024: 100%
YOY variation: 0.0%
LATAM
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13 / FINANCIAL STATEMENTS
% of Holding's assets: 0.12877%
Chairman of the Board: Jerome Paul Jacques Cadier
Board Members: Jerome Paul Jacques Cadier
(Chairman and Director without specific designation);
Bruno Macarenco Aléssio (Chief Financial Officer);
and Jefferson Cestari (Director without specific
designation).
Corsair Participações S.A.
Incorporation: Joint Stock Corporation established
in Brazil in 2011.
Purpose:
a. To participate in other civil or trade companies,
as a shareholder or creditor.
b. To manage its own assets.
Registered address: Rua Ática, 673, andar 7, sala
71, Jardim Brasil. São Paulo, Brazil.
Paid-in Capital: ThUS$31
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00071%
Chairman of the Board: Carlos Eduardo Prado
Board Members: Carlos Eduardo Prado (Chairman)
and Bruno Macarenco Alessio (Director without
specific designation).
TP Franchising Ltda.
Incorporation: Limited Liability Company established
in Brazil in 2004.
Purpose:
a. To award franchises.
b. To temporarily award its franchisees, free of
charge or for a fee, the right to use its brands,
systems, knowledge, methods, patents, actuation
technology, and any other rights, stakes, or assets,
whether personal or real estate, tangible or intangible,
owned by the Company, as present or future owner
or licensee, for the development, implementation,
operation, or management of the franchises that it
may award.
c. To carry out any and all necessary activities to
ensure, insofar as possible, the ongoing maintenance
and perfecting of the actuation patterns of its
franchise network.
d. To develop implementation, operation, and
management models for its franchise network and
their transfer to the franchisees.
e. The distribution, sale, and marketing of airplane
tickets and related products, as well as any related
or accessory business to its main purpose, while also
able to participate in other companies as partner or
shareholder, either in Brazil or abroad, or in consortia,
as well as to carry out its own projects, or form
partnerships with third parties in their projects, even
to obtain tax benefits, pursuant to current legislation.
Registered address: Rua Ática, 673, andar 8, sala
81, Jardim Brasil. São Paulo, Brazil.
Paid-in Capital: ThUS$5
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00564%
Managers: Jerome Paul Jacques Cadier, Bruno
Macarenco Alessio and Jefferson Cestari.
Prismah Fidelidade Ltda.
Incorporation: Limited Liability Company established
in Brazil in 2015.
Purpose:
a. The rendering of various services related to
customer loyalty programs and incentive programs
for the companies' sales chain including, among
others, customer relations management, technical
consulting, and technology consulting.
b. The development of customer loyalty/customer
relations programs and sales chain incentive programs
for companies, including through points programs
or other exchange currencies that can be converted
into loyalty program points.
c. The rendering of commercial representation and
brokerage services for the sale of retail products in
general, in addition to the rendering of brokerage
services for the contracting of insurance and extended
warranty products.
d. Shareholding in other companies.
Registered address: Rua Ática, 673, andar 8, sala
83, Jardim Brasil. São Paulo, Brazil.
Paid-in Capital: ThUS$7,304
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.12324%
Managers: Jerome Paul Jacques Cadier, Bruno
Macarenco Alessio and Jefferson Cestari.
Multiplus Corretora de Seguros Ltda.
Incorporation: Limited Liability Company established
in Brazil in 2016.
Purpose: Brokerage of insurance in the basic lines of
insurance, property and casualty, life (individuals),
capitalization, plans, social security, health and all
other lines of insurance provided for in the regulations.
Registered address: Rua Ática, 673, andar 8, sala
82, Jardim Brasil. São Paulo, Brazil.
Paid-in Capital: ThUS$851
Stake in 2024: 100%
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13 / FINANCIAL STATEMENTS
YOY variation: 0.0%
% of Holding's assets: -0.00084%
Managers: Jerome Paul Jacques Cadier, Bruno
Macarenco Alessio and Jefferson Cestari.
LAN CARGO S.A. AND AFFILIATES
Name: Lan Cargo S.A.
Incorporation: established as a closed stock company
via a public deed dated May 22, 1970, awarded at
the offices of Notary Public Sergio Rodriguez Garces,
under the name “Línea Aérea del Cobre S.A.”; an
excerpt of this deed is recorded in the Santiago
Commerce Registry on page 5,611 item 2,420 of
the year 1970, and published in the Official Gazette
on July 22, 1970.
The Extraordinary Shareholders' Meeting of Línea
Aérea del Cobre S.A., held on December 19, 1988,
agreed to change the company's name to "LADECO
S.A.", which was recorded as a public deed on January
25, 1989, at the Santiago Notary Office of Mr. Aliro
Veloso Muñoz. An excerpt of the deed to which the
Minutes of said Meeting referred was recorded in the
Real Estate Registry of the Registry of Commerce
on page 3,828 item 1,845 of the year 1989 and
published in the Official Gazette on February 16,
1989.
The company’s Extraordinary Shareholders' Meeting
resolved the merger by incorporation of LADECO S.A.
with Fast Air Carrier S.A., the latter being the absorbed
company. The minutes of said Shareholders' Meeting
were recorded as a public deed on November 20,
1998 at the Santiago Notary Office of Mr. Eduardo
Pinto Peralta, an extract of which was registered on
page 30,091, item 24,117 of the Santiago Commercial
Registry and published in the Official Gazette on
December 3, 1998.
The Extraordinary Shareholders' Meeting of LADECO
S.A. held on October 22, 2001, resolved to change
the corporate name to "LAN Chile Cargo S.A.". The
minutes of the Extraordinary Shareholders' Meeting
were recorded as a public deed on the same date,
at the Santiago Notary Office of Mr. Cosme Gomila
Gatica. An excerpt of said deed was recorded in
the Real Estate Registry of the Santiago Registry
of Commerce on page 27,746 item 22,624 of the
year 2001 and published in the Official Gazette on
November 05, 2001. The name change took effect
on December 10, 2001.
Subsequently, on August 17, 2004, the Extraordinary
Shareholders' Meeting agreed to change the name
of LAN Chile Cargo S.A. to "LAN Cargo S.A.". The
minutes of this Extraordinary Shareholders' Meeting
were recorded as a public deed on August 23, 2004.
An excerpt of said deed was recorded in the Real
Estate Registry of the Santiago Registry of Commerce
on page 26,994 item 20,082 of the year 2004 and
published in the Official Gazette on August 30, 2004.
Purpose: Perform and provide, either for itself or third
parties, the following: general transportation in any
form and, specifically, air transport of passengers,
cargo, and correspondence, within the country and
abroad; tourism, lodging, and other related activities,
in any form, within the country and abroad; purchase,
sale, manufacture and/or integration, maintenance,
leasing, or any other form of use, be it on its own
behalf or for third parties, of airplanes, spare parts,
and aeronautical equipment, and their operation for
any given purpose; provide all sorts of services and
counseling related to transportation in general and,
specifically, to air transportation in any of its forms, be
it ground support, maintenance, technical assistance,
or any other type, within the country and abroad,
and all sorts of services and activities related to
tourism, lodging, and other aforementioned activities
and goods, within the country and abroad. In order
to meet the aforementioned goals, the Company
may perform investments or participate as partner
in other companies, either by purchasing stocks or
rights or stakes in any other type of corporation, be
it an already established one or one created in the
future, and overall, perform all acts and enter all
contracts necessary and relevant to the purposes
described.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$83,060
Profit for the period: ThUSD$(529)
Stake in 2024: 99.89804%
YOY variation: 0.0%
% of Holding's assets: 2.32178%
Chairman of the Board: Andrés del Valle
Board Members: Andres Bianchi Urdinola (LATAM
Executive), Ramiro Alfonsin Balza (LATAM Executive)
and Andres Del Valle (LATAM Executive)
General Manager: Andrés Bianchi Urdinola
LAN CARGO S.A. AFFILIATE COMPANIES
Fast Air Almacenes de Carga S.A.
Incorporation: Joint Stock Corporation established
in Chile in 1992.
Purpose: To operate or manage the warehouses
or storage facilities of customs deposits, where
any type of goods or merchandise can be stored
until its withdrawal, for imports, exports, or other
customs destination, pursuant to the terms stated
within the Customs Ordinance, its rules, and other
corresponding regulation.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$6,741
Stake in 2024: 99.89%
YOY variation: 0.0%
% of Holding's assets: 0.03941%
Board Members: Jorge Patricio Marin Muñoz (LATAM
Executive), Andres Bianchi Urdinola (LATAM Executive)
and Roberto Alvo Milosawiewitsch (LATAM Executive).
General Manager: Patricio Linzmayer Paganini
Prime Airport Services Inc.
Name: Prime Airport Services Inc.
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Incorporation: Corporation established in the United
States.
Purpose: To operate or manage the warehouses or
storage facilities of customs deposits, where any
type of goods or merchandise can be stored until its
withdrawal, for imports, exports, or other customs
destination, pursuant to the terms stated by the
Department of Homeland Security, its rules, and
other corresponding regulation.
Registered address: 6450 N.W. 22 Street, Bldg. 710,
Miami, Florida, 33122, USA.
Paid-in Capital: ThUS$2
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.02078%
Board member: Andres Bianchi
Chairman: Antonio Orlandini
Transporte Aéreo S.A.
Incorporation: Joint Stock Corporation established
in Chile in 2001.
Purpose: The air transportation business in any
form, whether of passengers, mail and/or cargo,
inside or outside the country, on its own behalf or on
behalf of others; maintenance, leasing and repair of
aircrafts; trade and development of activities related
to travel, tourism and hospitality; development and
participation in all kinds of investments in Chile and
abroad.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$32,489
Stake in 2024: 99.99988%
YOY variation: 0.0%
% of Holding's assets: 0.76537%
Board Members: Andres del Valle Eitel (LATAM
Executive), Ramiro Alfonsin Balza (LATAM Executive)
and Roberto Alvo Milosawlewitsch (LATAM Executive).
General Manager: Jose Tomas Covarrubias Cervero
LAN Cargo Inversiones S.A. and affiliate
Name: Lan Cargo Investments S.A.
Incorporation: Joint Stock Corporation established
in Chile in 2001.
Purpose:
a. To market air transportation in any of its forms,
be it for passengers, mail, and/or cargo, and anything
directly or indirectly related to that activity within
or outside the country, on its own behalf or for third
parties.
b. To render services related to the maintenance and
repair of its own or third parties’ aircraft.
c. Trade and development of activities related to
travel, tourism, and lodging.
d. The development and/or participation in all kinds
of investments, both in Chile and abroad, in matters
directly or indirectly related to aeronautical affairs
and/or other business purposes.
e. Development and operation of all other activities
derived from and/or related, connected, contributory,
or complementary to the company’s corporate
purpose.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$159
Stake in 2024: 99%
YOY variation: 0.0%
% of Holding's assets: 0.60322%
Board Members: Andres Bianchi Urdinola Plaza
(LATAM Executive), Andres del Valle Eitel (LATAM
Executive) and Roberto Alvo Milosawlewitsch (LATAM
Executive).
General Manager: Andrés del Valle Eitel
Connecta Corporation
Incorporation: Corporation established in the United
States.
Purpose: Ownership, operating leasing, and subleasing
of aircraft.
Registered address: 6500 N.W. 22 Street, Miami,
Florida, 33122, USA.
Paid-in Capital: ThUS$1
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.21194%
Chairman: Andrés Bianchi Urdinola
Linea Aerea Carguera de Colombia S.A.
(Subsidiary of LAN Cargo Inversiones)
Incorporation: Joint Stock Corporation established
in Colombia.
Purpose: To provide public, commercial cargo,
and correspondence air transportation within the
Republic of Colombia and from and to Colombia. As a
secondary corporate purpose, the company can offer
maintenance services to itself and to third parties;
run its operations school and provide theoretical
and practical instruction services, as well as training
for its own and third-party aeronautical personnel
in the various modes and specialties; import spare
parts and replacements related to aeronautical
activities, for itself and for third parties; provide
airport services to third parties; represent or broker
national and foreign air transport companies for
passengers or cargo, and in general, companies that
provide services to the aeronautical sector.
LATAM
GROUP
2024
› 378
13 / FINANCIAL STATEMENTS
Registered address: Av. El Dorado No. 103-08 Entrada
1 - Hangar. Bogota, Colombia.
Paid-in Capital: ThUS$796 ($1,861,785,000.00
Colombian Pesos)
Stake in 2024: 81.30%
YOY variation: 0.0%
% of Holding's assets: 0.74011%
Board Members: Jorge Nicolas Cortazar Cardoso
(Permanent), Jose Mauricio Rodriguez Munera
(Permanent), Jaime Antonio Gongora Esguerra
(Permanent), Andres Bianchi Urdinola (alternate
member), Gabriel Vallejo López (alternate member) and
Helen Victoria Warner Sanchez (alternate member).
Management: Jaime Antonio Gongora Esguerra
(Permanent) and Erika Zarante Bahamon (alternate
member).
Inversiones Aéreas S.A.
Incorporation: Joint Stock Corporation established
in Peru in 1997.
Purpose:
a. To promote, establish, organize, operate, and
participate in the capital and equity of all types
of trade companies, civil associations, industrial,
commercial, service, or any other type of associations
or companies, both national and foreign, as well as
to participate in their management or settlement.
b. The acquisition, disposal and, in general, the
trading of all kinds of shares, stakes, and any other
security permitted by law.
c. The rendering or contracting of technical, advisory
and consulting services, as well as the execution of
contracts or agreements for these purposes.
Registered address: Av. Santa Cruz 381, Miraflores.
Lima, Peru.
Paid-in Capital: ThUS$88,290
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.66229%
Chairman of the Board: Martin Eduardo Palomino
Zapata
Board Members: Andrés Enrique del Valle Eitel,
Antonio Orlandini, Antonio Olortegui.
General Manager: Martin Eduardo Palomino Zapata
Prime Cargo SpA
(Subsidiary of Lan Cargo S.A.)
Incorporation: Joint Stock Corporation established
in Chile in 2023.
Purpose: The exclusive purpose of the Company
shall be the performance of warehousing activities
of all types of products and/or merchandise; and, in
general, the performance of any other activity and/
or business directly related to or complementary to
warehousing activities, or that are necessary and/
or convenient for the adequate development of
such activities, enabling the Company to provide
comprehensive warehousing solutions.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$803
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00025%
Americonsul S.A. de C.V.
(Subsidiary of Lan Cargo S.A.)
Incorporation: Variable Capital Corporation established
in Mexico.
Purpose: To provide and receive all manner of
technical, administrative, or counseling services
for industrial, commercial, and service companies;
Promote, organize, manage, supervise, provide, and
direct personnel training courses; Perform all types
of studies, plans, projects, and research; Engage the
necessary professional and technical personnel.
Registered address: Paseo de la Reforma 284. Piso
17 oficina 17. Mexico City, Mexico.
Paid-in Capital: ThUS$5
Stake in 2024: 99.80%
YOY variation: 0.0%
% of Holding's assets: -0.02717%
Management: Diana Olivares and Eduardo Opazo
Americonsult de Guatemala S.A.
(Subsidiary of Americonsul S.A. de C.V.)
Incorporation: Joint Stock Corporation established
in Guatemala.
Purpose: Powers to represent, broker, negotiate,
and market; carry out all types of commercial and
industrial activities; all manner of trade in general;
broad purpose that allows for all manner of operations
within the country.
Registered address: 12 calle 1-25 zona 10 Edificio
Géminis 10, Torre Norte Nivel 12. Guatemala City,
Guatemala.
Paid-in Capital: ThUS$76
Stake in 2024: 99.13%
YOY variation: 0.0%
% of Holding's assets: -0.00379%
Chairman of the Board: Luis Ignacio Sierra Arriola
Board Members: Carlos Fernando Pellecer Valenzuela
Management: Carlos Fernando Pellecer Valenzuela
LATAM
GROUP
2024
› 379
13 / FINANCIAL STATEMENTS
Americonsult de Costa Rica S.A.
(Subsidiary of Americonsult S.A. de C.V.)
Incorporation: Joint Stock Corporation established
in Costa Rica.
Purpose: General trade; industry, agriculture, and
livestock.
Registered address: Oficentro Torres del Campo,
Edificio 1, 2º piso. Barrio Tournón.San José, Costa
Rica.
Paid-in Capital: ThUS$20
Stake in 2024: 99.80%
YOY variation: 0.0%
% of Holding's assets: -0.00353%
Management: Luis Ignacio Sierra Arriola, Alejandro
Fernandez Espinoza (Treasurer), Luis Miguel Renguel
Lopez, Tomas Nassar Perez and Marjorie Hernandez
Valverde.
LATAM AIRLINES PERU S.A.
Incorporation: Joint Stock Corporation established
in Peru in 1997.
Purpose: Render air transportation services for
passengers, cargo, and correspondence, both
nationally and internationally, pursuant to current
civil aeronautical legislation.
Registered address: Av. Santa Cruz 381, Miraflores.
Lima, Peru.
Paid-in Capital: ThUS$43,445
Profit for the period: ThUS$22,842
Stake in 2024: 99.81%
YOY variation: 0.0%
% of Holding's assets: 0.46992%
Chairman of the Board: Cesar Emilio Rodríguez
Larraín Salinas
Board Members: Cesar Emilio Rodriguez Larrain
Salinas, Ignacio Cueto Plaza (LATAM Executive),
Enrique Cueto Plaza (LATAM Executive), Jorge Harten
Costa, Andres Rodriguez Larrain Miro Quesada,
Emilio Rodriguez Larrain Miro Quesada and Roberto
Alejandro Alvo Milosawlewitsch (LATAM Executive)
General Manager: Manuel Van Oordt
LATAM TRAVEL CHILE II S.A.
Incorporation: Joint Stock Corporation established
in Chile in 2012.
Purpose: The operation, management, and representation
of national or foreign companies or businesses in
lodging, shipping, aviation, and tourism activities in
general; brokerage of tourist services, such as:
a. The booking of seats and the sale of tickets in
all kinds of domestic and international forms of
transportation.
b. The booking, acquisition, and sale of accommodation
and tourist services, tickets or bills to all types of
shows, museums, monuments, and protected areas
in the country.
c. The organization, promotion, and sale of the so-
called tourist packages, understood as the set of tourist
services (catering, transportation, accommodation,
etc.), adjusted or projected at the request of the
client at a preset price, to be operated within the
national territory.
d. Air, land, sea, and river tourist transportation
within the national territory and abroad.
e. The lease and charter of aircraft, ships, buses,
trains, and other forms of transportation for the
rendering of tourist services.
f. Offering air transportation in any form, whether
for passengers, cargo, or mail.
g. Any others, directly or indirectly related to the
rendering of the services described above.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$10
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: -0.00580%
Board Members: Andres del Valle Eitel (LATAM
Executive), Roberto Alvo Milosawlewitsch (LATAM
Executive) and Ramiro Alfonsin Balza (LATAM
Executive)
General Manager: Nicolas Salazar
LATAM TRAVEL S.R.L.
Incorporation: Limited Liability Company established
in Brazil.
Purpose: Operation, management, and representation
of national or foreign companies or businesses in
the lodging, shipping, air, and tourism activities in
general; and brokerage of tourist services, such as:
(a) booking seats and selling tickets for all types of
national or international transportation, (b) booking,
acquisition, and sale of lodging and tourist services,
and tickets to all types of entertainment, museums,
monuments, and protected areas in the country
or abroad, (c) organization, promotion, and sale of
tourist packages, understood as the group of tourist
services (food, transportation, lodging, etc.), adjusted
or projected at the clients behest, at a preset price,
(d) air, land, sea, and river tourist transportation
within the national territory and abroad, (e) leasing
and charter of planes, ships, buses, trains, and other
forms of transportation for the provision of tourist
services, (f) marketing of air transportation in any
form, whether of passengers, cargo, or mail, and
(g) any other activity directly or indirectly related
to the rendering of the services mentioned above.
LATAM
GROUP
2024
› 380
13 / FINANCIAL STATEMENTS
Registered address: Av. Los Álamos № 322, zona
La Florida. La Paz, Bolivia.
Paid-in Capital: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00061%
Board Members: Julio Quintanilla Quiroga and Sergio
Antelmo
LAN PAX GROUP S.A.
Incorporation: Incorporated as a closed stock company
in 2001.
Purpose: Perform investments in all manner of goods,
be they assets or real estate, tangible or intangible.
Within its line of business, the Company may create
other types of companies of any sort; acquire rights
in already existing corporations, manage, modify,
and settle them. Overall, it may acquire and sell all
manner of goods and operate them, on its own behalf
or for third parties, as well as perform all manner of
acts and enter all manner of contracts conducive to
its goals. Exercise the development and operation
of all other activities derived from and/or related,
connected, contributory, or complementary to the
company's corporate purpose.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$16,925
Profit for the period: ThUSD$(92,082)
Stake in 2024: 99.99%
YOY variation: 0.0%
% of Holding's assets: -9.60597%
Board Members: Andres del Valle Eitel (LATAM
Executive), Roberto Alvo Milosawlewitsch (LATAM
Executive) and Felipe Pumarino (LATAM Executive)
General Manager: Andrés del Valle Eitel (LATAM
Executive)
AFFILIATE COMPANIES OF LAN PAX GROUP
S.A. AND STAKES
Holdco Colombia I SpA
Incorporation: Joint Stock Corporation established
in Chile in 2018.
Purpose: To make investments in all types of
assets, goods and chattels or real estate, tangible or
intangible, on its own behalf or the behalf of others,
both in Chile and abroad. Likewise, to form, join and
participate in all kinds of companies, communities,
associations and joint ventures, and the administration
and operation of these investments and the receipt
of their profits and any other type of benefit agreed
upon by the shareholders. In addition, to enter into
contracts and legal acts necessary for such purposes
Registered address: Av. Presidente Riesco 5711,
Santiago, Chile.
Paid-in Capital: ThUS$1,449
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00948%
Administrator: Lan Pax Group S.A.
Inversora Cordillera S.A. and affiliates
Name: Inversora Cordillera S.A.
Incorporation: Joint Stock Corporation established
in Argentina.
Purpose: To perform investments on its own behalf
or for third parties, or related to third parties, in other
stock companies, regardless of corporate purpose,
established or to be established, within the Argentine
Republic or abroad, via acquisition, incorporation,
or sale of stakes, shares, quotas, bonds, options,
commercial paper, convertible or otherwise, other
transferable securities, or other forms of investment
allowed by the applicable regulation at any given
moment, either to hold them in its own portfolio,
or to sell them partially or in full, as may be the
case. For this purpose, the company may carry out
all transactions that are not expressly forbidden by
law in compliance with its corporate purpose, and
it has full legal capacity to acquire rights, contract
obligations, and exercise all acts that are not expressly
forbidden by law or statute.
Registered address: Suipacha 1111 Piso 18, [1008].
Ciudad Autónoma de Buenos Aires, Argentina.
Paid-in Capital: ThUS$9,984
Stake in 2024: 99.95%
YOY variation: 0.0%
% of Holding's assets: -0.31420%
Board Members: Manuel Maria Benites Jorge Luis
Perez Alati Rosario Altgelt
Management: Manuel Maria Benites, Jorge Luis Perez
Alati, Jeronimo Cortes and Diego Potenza.
Atlantic Aviation Investments LLC
Incorporation: Limited Liability Company established
in the United States.
Purpose: Any and all lawful business that the
company may undertake.
Registered address: c/o The Corporation Trust
Company, Corporation Trust Center, 1209 Orange
Street, Wilmington, DE 19801, USA.
Paid-in Capital: ThUS$1
Stake in 2024: 99%
YOY variation: 0.0%
% of Holding's assets: 0.07507%
Management Board: Andrés del Valle Eitel, Andrés
Bianchi Urdinola, Joaquín Arias Vicuña, Paola Peñarete.
LATAM
GROUP
2024
› 381
13 / FINANCIAL STATEMENTS
Management: Andrés del Valle (LATAM Executive)
LATAM Airlines Ecuador S.A. (Formerly,
Aerolane Líneas Aéreas Nacionales del
Ecuador S.A.)
Incorporation: Joint Stock Corporation established
in Ecuador.
Purpose: Combined or exclusive air transport of
passengers, cargo, and correspondence.
Registered address: Conector de Alpachaca S/N
Secundaria Hangar LATAM latitud 0, administrative
offices next to Quiport firefighters building. Quito,
Ecuador.
Paid-in Capital: ThUS$34,100
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.07756%
Board Members: Xavier Rivera, Mónica Fistrovic and
Mariela Anchundia
CEO: Mariela Anchundia
Holdco Ecuador S.A
Incorporation: Joint Stock Corporation established
in Chile in 2014.
Purpose: Carry out all manner of investments
for profitable purposes pertaining to tangible or
intangible, personal or real estate assets, either in
Chile or abroad.
Registered address: Av. Presidente Riesco 5711,
Piso 20. Santiago, Chile.
Paid-in Capital: ThUS$491
Stake in 2024: 54.79076%
YOY variation: 0.0%
% of Holding's assets: 0.00614%
Board Members: Andres del Valle, Manuel Van Oordt
and Felipe Pumarino.
General Manager: Ramiro Alfonsin Balza (LATAM
Executive)
Aerovias de Integración Regional S.A.– Aires
S.A. and/or LA-TAM AIRLINES Colombia S.A.
Incorporation: Joint Stock Corporation established
in Colombia.
Purpose: The company's corporate purpose shall be
the operation of national or international commercial
air transportation services, in any form, and therefore,
the entering into and execution of contracts for the
transportation of passengers, objects or luggage,
correspondence, and cargo in general, pursuant to
the operating permits issued to this effect by the
Special Administrative Unit of Civil Aeronautics, or
the agency that may carry out said functions in the
future, adhering fully to the provisions of the Code
of Commerce, the Colombian Aviation Regulations,
and any other rules issued on the matter. Likewise,
to provide maintenance and adaptation services
for the equipment related to the operation of air
transportation services within the country and abroad.
In order to fulfill said purpose, the company will
be authorized to invest in other national or foreign
companies with purposes that are the same, similar,
or complementary to the companys. To fulfill its
corporate purpose, the company may, among other
things:
a. Check, inspect, or provide maintenance and/or
repairs to its own or third-party aircraft, as well as
spare parts and accessories, through the Company’s
Aeronautical Repair Stations, providing the necessary
training for said purpose.
b. Organize, establish, and invest in commercial
transportation companies in Colombia or abroad to
perform, industrially or commercially, the economic
activity that is its purpose, so the company can
acquire, for any purpose, airplanes, spare parts,
replacements, and accessories of any kind, necessary
for public air transportation, as well as sell them,
and to set up and operate stations to repair and give
maintenance to the aircraft.
c. Enter into lease, charter, shared code, location or
any other contracts on aircraft to exercise its purpose.
d. Operate scheduled air transport lines for
passengers, cargo, and mail and securities, as well
as the vehicle for coordinating the development of
social management.
e. Integrate with like, similar, or complementary
companies to develop their activity.
f. Accept national or foreign representations of
services of the same business or of complementary
businesses.
g. Acquire goods and chattels and real estate for
the development of its social purposes, build such
facilities or constructions, such as warehouses, offices
etc., dispose of or tax them.
h. Carry out imports and exports, as well as all
foreign trade operations required.
i. Take money on interest and provide personal, real,
and bank guarantees, either on its own behalf or for
third parties.
j. Participate in all manner of securities transactions,
such as purchase or sale of debentures acquired by
third parties when resulting in an economic or equity
benefit for the company, and obtain loans through
bonds or other liability instruments.
k. Enter into contracts with third parties for the
management and operation of the businesses it may
organize to achieve its corporate purposes.
l. Enter into contracts of companies and acquire
shares or stakes in those already established, whether
national or foreign; make contributions to both.
m. Merge with other companies and partner with
similar entities to pursue the development of aviation
or for other trade purposes.
n. Promote, assist technically, finance or manage
enterprises or companies related to the corporate
purpose.
LATAM
GROUP
2024
› 382
13 / FINANCIAL STATEMENTS
ñ. Enter or execute any kind of civil or commercial,
industrial, or financial contracts that are necessary
or desirable for the achievement of their own ends.
o. Conduct business and activities that seek customers,
and obtain from the competent authorities the
necessary authorizations and permits to render their
services.
p. The development and performance of other
activities arising from the corporate purpose and/or
related, connected, contributory, or complementary
activities thereto, including the rendering of tourist
services under any mode permitted by law, such as
travel agencies.
q. Managing any lawful business or activity, whether
or not in trade, provided that it is related to its
corporate purpose, or that it allows the most rational
operation of the public service to be rendered.
r. Make investments of any kind to use the funds
and reserves that are constituted in accordance with
the law or these bylaws.
s. To render airport stopover services and/or ground
handling services for the arrival, stay and departure
of aircraft, individuals, loading and unloading of goods
or baggage, as well as for the handling, operational
dispatch of flights, or transit maintenance and
other assistance facilities for own and/or third-
party aircraft, service desk for own and third-party
customers, including, but not limited to, national
and international carriers.
Registered address: Av. El Dorado No. 103-08 Entrada
1 - Hangar. Bogota, Colombia.
Paid-in Capital: ThUS$3,389 ($5,251,578,000,000.00
Colombian Pesos)
Stake in 2024: 99.2%
YOY variation: 0.0%
% of Holding's assets: 0.05855%
Board Members: Jorge Nicolas Cortazar Cardoso
(Permanent), Gabriel Vallejo López (Permanent),
Jose Mauricio Rodriguez Munera (Permanent), Felipe
(alternate member), Helen Victoria Warner Sanchez
(alternate member) and Andrés Enrique del Valle
Eitel (alternate member).
Management: Erika Zarante Bahamon (Principal
Legal Representative) and Jaime Antonio Gongora
Esguerra (Alternate Legal Representative).
LAN Argentina S.A. (A subsidiary of Inversora
Cordillera S.A.)
Incorporation: Joint Stock Corporation established
in Argentina.
Purpose: Perform, on its own behalf or for third parties,
independently or in association with third parties in
the country or abroad, the following activities:
a. Aeronautics: Air transportation in all its forms,
scheduled and/or chartered (hired charter or air
taxi), local or international, of persons and things,
correspondence, clearing, works, and air services in
general, as a public or private concession; operate
public services, pilot school, and personnel training
in air navigation, design, engineering, research,
assembly- manufacturing, import and/or export
of all sorts of aircrafts and their parts, equipment,
accessories, and materials for air navigation, as well
as render maintenance and technical assistance
services to said crafts.
B. Commercial: Through the purchase, sale, exchange,
rental in all its forms, leasing, imports, and exports
of all types of goods, supply and transfer of aircrafts,
parts and components, accessories, materials, and
inputs, brokerage in formalizing insurance to cover the
risks of the services contracted, and performance of
all types of commercial transactions that normally
take place in airports.
c. Tourism: Through the creation, development,
and operation of resorts and properties destined to
lodge people, as well as tourist activities in every
form, including motor vehicle rentals and tourist
reservation services.
d. Services: Through the rendering of maintenance
and technical assistance services for all types of
aircraft, equipment, accessories, and material
for air navigation, computer reservation services,
transportation services for people and/or cargo and/
or correspondence, by land or water, as an accessory
to air transportation and/or integrating a combined
transportation with the latter, as well as all sorts of
assistance for air navigation activities, such as the
supply of food and/or elements for in-flight use.
e. Mandates: Fulfill mandates and commissions.
f. Financial: Perform any type of financial transaction
in general, except for those provided in the Financial
Institutions Act and any others requiring a public
tender process.
g. Representations: of national or foreign persons
related to activities pertaining to its corporate
purpose.
h. Investing: Establish and participate in companies
through shares, fostering their creation, investing
in them the necessary capital for those ends,
and rendering services to them within the limits
established. For said purposes, the Company has full
legal capacity to acquire rights, assume obligations,
and exercise the acts not expressly forbidden to it
by law and by these Bylaws.
Registered address: Suipacha 946, Piso 7, Ciudad
Autónoma de Buenos Aires, Argentina.
Paid-in Capital: ThUS$6,986
Stake in 2024: 94.95770%
YOY variation: -0.0%
% of Holding's assets: -0.31423%
Board Members: Manuel Maria Benites, Jorge Luis
Perez Alati and Rosario Altgelt
Management: Manuel Maria Benites, Jorge Luis Perez
Alati, Jeronimo Cortes and Diego Potenza
TECHNICAL TRAINING LATAM S.A.
Incorporation: Incorporated as a corporation in 1997.
Purpose: Its corporate purpose is to provide training
and other types of related services.
LATAM
GROUP
2024
› 383
13 / FINANCIAL STATEMENTS
Registered address: Av. Cesar Lavin Toro 2198
Pudahuel. Santiago, Chile.
Paid-in Capital: ThUS$536
Profit for the period: ThUS$205
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00326%
Board Members: Sebastian Acuto (LATAM executive),
Ramiro Alfonsin Balza (LATAM executive) and Hernan
Pasman (LATAM executive).
General Manager: Jorge Sturla (LATAM executive)
JARLETUL S.A
Incorporation: Joint Stock Corporation established
in Uruguay in 2017.
Purpose: Its corporate purpose is:
A) To industrialize and commercialize in all forms,
merchandise, leasing of goods, works and services
in the industries and annexes of: food, household
and office items, automotive, bar, bazaar, rubber,
communication, construction, cosmetics, leather,
sports, publishing, electronics, electrical engineering,
teaching, entertainment, pharmacy, hardware,
photography, hotel, printing, computer, jewelry, toys,
wool, laundry, books, cleaning, wood, machinery,
maritime, mechanics, metallurgy, mining, music,
engineering, optics, paper, perfumery, fishing, plastics,
press, advertising, chemicals, professional, technical
and administrative services, tobacco, television,
textiles, transportation, tourism, securities, clothing,
veterinary, glass.
B) Imports, exports, representations, commissions
and consignments.
C) Purchase, sale, leasing, management, construction
and all kinds of transactions involving real estate.
D) Agricultural exports, forestry, fruit farming, citrus
farming and derivatives.
E) Shareholding, incorporation or acquisition of
companies operating in the aforementioned industries.
Registered address: Aeropuerto de carrasco RUTA
101. Canelones, Uruguay.
Paid-in Capital: ThUS$0
Profit for the period: ThUSD$(4)
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: -0.00714%
Chairman of the Board: Vacant
Board Members: Fernando Augusto Carneiro de
Carvalho and Patricia Mendoza Mallo
PROFESSIONAL AIRLINE SERVICES INC.
Incorporation: Company established in the United
States in 1994.
Purpose: Airport staffing services for LATAM group
at Miami International Airport.
Registered address: 6500 N.W. 22 Street, Miami,
Florida, 33122, USA.
Paid-in Capital: ThUS$63
Profit for the period: ThUS$2,220
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding’s assets: 0.04490%
Treasurer: Eduardo Opazo
Chairman: Antonio Orlandini
LATAM FINANCE LIMITED
Incorporation: Company established in the Cayman
Islands in 2016.
Purpose: Its purpose is to issue securitized bonds.
Registered address: Cayman Islands
Paid-in Capital: ThUS$0
Profit for the period: ThUS$-1
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: -1.36696%
Board Members: Andres del Valle Eitel, Ramiro
Alfonsin Balza and Joaquin Arias Acuña
PEUCO FINANCE LIMITED
Incorporation: Company established in the Cayman
Islands in 2015.
Purpose: Its purpose is to participate in financing
operations with other companies of LATAM Group.
Registered address: Cayman Islands
Paid-in Capital: ThUS$0
Profit for the period: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.0%
Board Members: Andres del Valle Eitel and Joaquin
Arias Acuña
LATAM TRAVEL S.A.
Incorporation: Joint Stock Corporation established
in Argentina.
Purpose: To perform on its own behalf or for third
parties and/or in partnership with third parties, within
LATAM
GROUP
2024
› 384
13 / FINANCIAL STATEMENTS
the country and/or abroad, the following activities
and transactions:
a. Commercial: Carry out, intervene, develop, or
design all manner of operations and activities
involving the sale of airfare, land, river, and sea
tickets, both nationally and abroad, or any other
service related to the tourism industry in general.
The aforementioned services may be carried out on
its own behalf or upon request from third parties,
via mandate, commission, the use of systems or
methods deemed convenient for said purpose, be
they manual, mechanical, electronic, telephone, or
internet methods, or any other type or technology
that may suit said purpose. The Company may
perform ad hoc or related activities to the purpose
described, such as purchase and sales, imports,
exports, reexport, licensing, and representation of
all manner of goods, services, “know-how, ” and
technology directly or indirectly related to the purpose
described; market, by any means the technology
created or whose license or patent it has acquired or
manages; develop, distribute, promote and market
all types of content for mass media of any sort.
b. Tourism: Via the performance of all activities related
to the tourist and lodging industry, as responsible
operator or third-party service operator, or as
travel agent. Via the creation of exchange, tourism,
excursion, and tour programs; the brokerage and
booking and rendering of services through any form
of transportation within the country or abroad, and
ticket sales; brokerage for hiring lodging services in
the country or abroad; booking of hotels, motels,
tourist apartments, and other tourist facilities;
organization of trips and tourism for individuals or
groups, excursions, or similar activities within the
country or abroad; reception and assistance for
tourists during their trip and stay in the country,
provision of tour guide services, and forwarding
of their baggage; representing other national or
foreign travel and tourism agencies, companies, or
institutions, in order to render any of these services
on their behalf.
c. Mandatary: Via the acceptance, performance, and
granting of representations, concessions, commissions,
agencies, and mandates in general.
d. Consulting: Provide consulting, support, and
management services on all matters related to the
organization, installation, service, development,
support, and promotion of companies related to air
transportation activities, but not exclusive to said
activity, in the management, industrial, commercial,
technical, and advertising areas, to be provided,
when the nature of the issue so requires, by certified
professionals per the corresponding regulation, and
the provision of organization and management, care,
maintenance, and surveillance services, and of the
suitable personnel, especially prepared to carry out
said tasks.
e. Financial: Via its participation in other companies
already created or to be created, either through
the acquisition of shares in established companies,
or through the establishment of new companies,
via the awarding or securing of credits, loans, cash
advances secured or unsecured by collateral or
personal guarantee; the awarding of guarantees and
sureties in favor of third parties for a fee or free
of charge; placement of funds in foreign currency,
gold or currencies, or bank deposits of any type. To
achieve these purposes, the company has full legal
capacity to exercise all acts not expressly forbidden
by law or statue, including making borrowings
publicly or privately via the issuance of debentures
and tradable securities, and performing all manner
of financial transactions except those comprised
under Law 21,526 and any others requiring a public
tender process.
Registered address: Suipacha 946, Piso 7, Ciudad
Autónoma de Buenos Aires, Argentina.
Paid-in Capital: ThUS$4,815
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.01458%
Board member: Jeronimo Cortes
Management: Jerónimo Cortés and Diego Potenza
LAN INVERSIONES S.A.
Incorporation: Joint Stock Corporation established
in Chile in 1990.
Purpose: Perform investments in all manner of
goods, be they assets or real estate, tangible or
intangible. Create other types of companies of any
sort, acquire rights in, manage, modify, and settle
other companies. Acquire and sell all manner of
goods and operate them, on its own behalf or for
third parties, as well as perform all manner of acts
and contracts conducive to its purposes.
Registered address: Av. Presidente Riesco 5711,
Santiago, Chile.
Paid-in Capital: ThUS$458 (29,000,000 Chilean
Pesos)
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00745%
Board Members: Andres del Valle Eitel (LATAM
Executive), Roberto Alvo Milosawlewitsch (LATAM
Executive) and Felipe Pumarino Mendoza (LATAM
Executive).
General Manager: Juan Pablo Arias (LATAM Executive).
HOLDCO I S.A.
Incorporation: Joint Stock Corporation established
in Chile in 2011.
Purpose: Carry out all manner of investments
for profitable purposes pertaining to tangible or
intangible, personal or real estate assets, either in
Chile or abroad.
Registered address: Av. Presidente Riesco 5711,
Santiago, Chile.
Paid-in Capital: ThUS$351,174.
Stake in 2024: 99.99831%
YOY variation: 0.0%
LATAM
GROUP
2024
› 385
13 / FINANCIAL STATEMENTS
% of Holding's assets: 2.27960
Board Members: Mauricio Rolim, Ignacio Cueto,
Enrique Cueto, Sonia Sulzbeck, Flavia Turci and Henri
Philippe.
General Manager: Enrique Cueto.
LAN TOURS DE MÉXICO, S.A. DE C.V.
Incorporation: Variable Capital Corporation established
in Mexico.
Purpose: Draft, organize and carry out tourism
projects, plans or itineraries.
Registered address: Paseo de la Reforma 284. Piso
17 oficina 17. Mexico City, Mexico.
Paid-in Capital: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00007
Management: Héctor Iriarte Fuentes (Sole Administrator).
GITARY TRADE S.A
Incorporation: Joint Stock Corporation established
in Uruguay in 2017.
Purpose: Its main purpose is: To participate in other
commercial companies in Uruguay or abroad in
accordance with the provisions of Article 47 of Law
16,060 as amended by Article 100 of Law 18,083.
Its secondary purpose is:
A) To carry out and manage all kinds of investment
activities (not included in Law 16,774, as amended
and related laws) in securities, bonds, debentures,
debenture bonds, bills, marketable securities, in the
country or abroad, on its own behalf or on behalf
of third parties; these activities are not included in
Decree-Law 15,322.
B) To industrialize and commercialize in all forms,
merchandise, leasing of goods, works and services
in the industries and annexes of: food, household
and office items, automotive, bar, bazaar, rubber,
communication, construction, cosmetics, leather,
sports, publishing, electronics, electrical engineering,
teaching, entertainment, pharmacy, hardware,
photography, hotel, printing, computer, jewelry, toys,
wool, laundry, books, cleaning, wood, machinery,
maritime, mechanics, metallurgy, mining, music,
engineering, optics, paper, perfumery, fishing, plastics,
press, advertising, chemicals, professional, technical
and administrative services, tobacco, television,
textiles, transportation, tourism, securities, clothing,
veterinary, glass. C) Imports, exports, representations,
commissions and consignments.
D) Purchase, sale, leasing, management, construction
and all kinds of transactions involving real estate. E)
Agricultural exports, forestry, fruit farming, citrus
farming and derivatives.
Registration address: Montevideo, Uruguay.
Paid-in Capital: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.0%
Board Members: Fernando Augusto Carneiro de
Carvalho and Patricia Mendoza Mallo.
Cargo Handling Airport Services LLC
Incorporation: Limited Liability Company established
in the United States.
Purpose: Ground handling staffing services for LATAM
group at Miami International Airport, and ground
handling services for cargo.
Registered address: 6500 N.W. 22 Street, Miami,
Florida 33122, USA.
Paid-in Capital: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.0%
Chairman: Daniel Leng
Treasurer: Eduardo Opazo
Professional Airline Cargo Services, LLC
Incorporation: Limited Liability Company established
in the United States.
Purpose: Ground handling staffing services for LATAM
group at the Miami International Airport, and ground
handling services for cargo.
Registered address: 6500 N.W. 22 Street, Miami,
Florida 33122, USA.
Paid-in Capital: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.0%
Chairman: Francisco Arana
Treasurer: Eduardo Opazo
Professional Airline Maintenance Services, LLC
Incorporation: Limited Liability Company established
in the United States.
Purpose: Line maintenance staffing services for
LATAM Group aircraft at Miami International Airport.
Registered address: 6500 N.W. 22 Street, Miami,
Florida 33122, USA.
Paid-in Capital: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.0%
13 / FINANCIAL STATEMENTS
Chairman: Jorge Hanson
Treasurer: Eduardo Opazo
Maintenance Service Experts LLC
Incorporation: Limited Liability Company established
in the United States.
Purpose: Line maintenance staffing services for
LATAM Group aircraft at Miami International Airport.
Registered address: 6500 N.W. 22 Street, Miami,
Florida 33122, USA.
Paid-in Capital: ThUS$0
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.00025%
Chairman: Jorge Hanson
Treasurer: Eduardo Opazo
LAN Cargo Repair Station, LLC
Incorporation: Limited Liability Company established
in the United States.
Purpose: Line maintenance services for LATAM group
and third-party aircraft and management of LAN
Cargo's hangar at Miami International Airport.
Registered address: 5900 N.W. 18 Street, Miami,
Florida 33122, USA.
Paid-in Capital: ThUS$1
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.07%
Manager: Jorge Hanson
Connecta Corporation
Incorporation: Corporation established in the United
States.
Purpose: Ownership, operating leasing, and subleasing
of aircraft.
Registered address: 6500 N.W. 22 Street, Miami,
Florida 33122, USA.
Paid-in Capital: ThUS$1
Stake in 2024: 100%
YOY variation: 0.0%
% of Holding's assets: 0.2%
Chairman: Andrés Bianchi Urdinola
13 / INFORMES FINANCIEROS
› 386
08 / PROVEEDORES
08 / PROVEEDORES
08 / PROVEEDORES
08 / PROVEEDORES
08 / PROVEEDORES
GRUPO
LATAM
2024
LATAM
GROUP
2024
› 387
13 / FINANCIAL STATEMENTS
LAN CARGO S,A, AND SUBSIDIARY
Summarized Financial Statements for Affiliates and Subsidiaries
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
236,014
196,254
Total non-current assets
581,521
506,572
Total assets
817,535
702,826
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
337,201
284,256
Total non-current liabilities
134,033
66,157
Total liabilities
471,234
350,413
EQUITY
Parent’s ownership interest
354,149
194,360
Participaciones no controladoras
(7,848)
158,053
Total equity
346,301
352,413
Total liabilities and equity
817,535
702,826
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Revenue
753,853
1,012,966
Cost of sales
(871,638)
(952,392)
Income (loss) from the operational activities
(117,785)
60,574
Income (loss) before taxes
(5,176)
36,679
Income tax benefits/(expense)
5,816
(12,866)
NET INCOME (LOSS) FOR THE YEAR
640
23,813
Income attributable to owners of the parent company
66
24,441
Income (Loss) attributable to non-controlling interest
574
(628)
NET INCOME (LOSS) FOR THE YEAR
640
23,813
LATAM
GROUP
2024
› 388
13 / FINANCIAL STATEMENTS
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
640
23,813
Total Other comprehensive income (loss)
(6,201)
(5,951)
Total comprehensive income (loss)
(5,561)
17,862
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(6,135)
18,775
Comprehensive income (loss) attributable to non-controlling interests
574
(913)
TOTAL COMPREHENSIVE INCOME (LOSS)
(5,561)
17,862
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
11,974
6,329
Net cash (outflow) inflow from investing activities
(3,737)
(68)
Net cash inflow (outflow) from financing activities
(8,437)
(9,231)
Effects of variation in the exchange rate on cash and cash equivalents
(334)
437
Net (decrease) increase in cash and cash equivalents
(534)
(2,533)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
42,676
45,209
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
42,142
42,676
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
195,616
156,797
352,413
Total comprehensive income
(6,135)
574
(5,561)
Total transactions with shareholders
164,668
(165,219)
(551)
Closing balance as of December 31, 2024
354,149
(7,848)
346,301
EQUITY 2023
Equity as of January 1, 2023
104,535
(60,706)
43,829
Total comprehensive income
18,775
(913)
17,862
Total transactions with shareholders
72,306
218,416
290,722
Closing balance as of December 31, 2023
195,616
156,797
352,413
LATAM
GROUP
2024
› 389
13 / FINANCIAL STATEMENTS
INVERSIONES LAN S.A.
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
1,100
1,156
Total non-current assets
83
83
Total assets
1,183
1,239
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
2
5
Total non-current liabilities
45
45
Total liabilities
47
50
EQUITY
Parent’s ownership interest
1,136
1,189
Total equity
1,136
1,189
Total liabilities and equity
1,183
1,239
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Income (loss) from the operational activities
(8)
(28)
Income (loss) before taxes
(53)
(36)
Income tax benefits/(expense)
-
-
NET INCOME (LOSS) FOR THE YEAR
(53)
(36)
Income (loss) attributable to owners of the parent company
(53)
(36)
NET INCOME (LOSS) FOR THE YEAR
(53)
(36)
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
(53)
(36)
Total comprehensive income (loss)
(53)
(36)
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(53)
(36)
TOTAL COMPREHENSIVE INCOME
(53)
(36)
LATAM
GROUP
2024
› 390
13 / FINANCIAL STATEMENTS
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
-
(9)
Net cash (outflow) inflow from investing activities
-
5
Net cash inflow (outflow) from financing activities
-
(25)
Effects of variation in the exchange rate on cash and cash equivalents
Net (decrease) increase in cash and cash equivalents
(45)
(37)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
376
413
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
331
376
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
1,189
-
1,189
Total comprehensive income
(53)
-
(53)
Closing balance as of December 31, 2024
1,136
-
1,136
EQUITY 2023
Equity as of January 1, 2023
1,225
-
1,225
Total comprehensive income
(36)
-
(36)
Closing balance as of December 31, 2023
1,189
-
1,189
LAN PAX GROUP AND SUBSIDIARY
tatements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
260,217
288,471
Total non-current assets
202,531
198,765
Total assets
462,748
487,236
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
1,623,423
1,583,445
Total non-current liabilities
310,076
252,092
Total liabilities
1,933,499
1,835,537
EQUITY
Parent’s ownership interest
(1,093,630)
(1,002,254)
Participaciones no controladoras
(377,121)
(346,047)
Total equity
(1,470,751)
(1,348,301)
Total liabilities and equity
462,748
487,236
LATAM
GROUP
2024
› 391
13 / FINANCIAL STATEMENTS
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Revenue
871,353
777,370
Cost of sales
(844,605)
(701,518)
Income (loss) from the operational activities
26,748
75,852
Income (loss) before taxes
(123,399)
8,197
Income tax benefits/(expense)
636
(683)
NET INCOME (LOSS) FOR THE YEAR
(122,763)
7,514
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
(122,763)
7,514
Total Other comprehensive income (loss)
31,945
(27,517)
Total comprehensive income (loss)
(90,818)
(20,003)
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(106,787)
22,660
Comprehensive income (loss) attributable to non-controlling interests
15,969
(42,663)
TOTAL COMPREHENSIVE INCOME (LOSS)
(90,818)
(20,003)
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
35,902
93,513
Net cash (outflow) inflow from investing activities
1,583
(899)
Net cash inflow (outflow) from financing activities
(61,504)
112
Effects of variation in the exchange rate on cash and cash equivalents
(26)
(263)
Net (decrease) increase in cash and cash equivalents
(24,045)
92,463
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
184,150
91,687
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
160,105
184,150
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
(1,002,254)
(346,047)
(1,348,301)
Total comprehensive income
(106,787)
15,969
(90,818)
Total transactions with shareholders
15,411
(47,043)
(31,632)
Closing balance as of December 31, 2024
(1,093,630)
(377,121)
(1,470,751)
EQUITY 2023
Equity as of January 1, 2023
(1,342,687)
6,951
(1,335,736)
Total comprehensive income
22,660
(42,663)
(20,003)
Total transactions with shareholders
317,773
(310,335)
7,438
Closing balance as of December 31, 2023
(1,002,254)
(346,047)
(1,348,301)
LATAM
GROUP
2024
› 392
13 / FINANCIAL STATEMENTS
LATAM FINANCE LIMITED
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
113
114
Total non-current assets
-
-
Total assets
113
114
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
208,621
208,621
Total non-current liabilities
-
-
Total liabilities
208,621
208,621
EQUITY
Parent’s ownership interest
(208,508)
(208,507)
Total equity
(208,508)
(208,507)
Total liabilities and equity
113
114
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Income (loss) from the operational activities
(1)
(1)
Income (loss) before taxes
(1)
(1)
Income tax benefits/(expense)
-
-
NET INCOME (LOSS) FOR THE YEAR
(1)
(1)
Income attributable to owners of the parent company
(1)
(1)
NET INCOME (LOSS) FOR THE YEAR
(1)
(1)
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
(1)
(1)
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
(1)
(1)
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(1)
(1)
TOTAL COMPREHENSIVE INCOME (LOSS)
(1)
(1)
LATAM
GROUP
2024
› 393
13 / FINANCIAL STATEMENTS
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
-
-
Net cash (outflow) inflow from investing activities
(1)
(1)
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
-
-
Net (decrease) increase in cash and cash equivalents
(1)
(1)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
114
115
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
113
114
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
(208,507)
-
(208,507)
Total comprehensive income
(1)
-
(1)
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2024
(208,508)
-
(208,508)
EQUITY 2023
Equity as of January 1, 2023
(208,506)
-
(208,506)
Total comprehensive income
(1)
-
(1)
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2023
(208,507)
-
(208,507)
PROFESSIONAL AIRLINE SERVICES INC Y FILIALES
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
12,617
15,571
Total non-current assets
-
-
Total assets
12,617
15,571
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
5,769
10,943
Total non-current liabilities
-
-
Total liabilities
5,769
10,943
EQUITY
Parent’s ownership interest
6,848
4,628
Total equity
6,848
4,628
Total liabilities and equity
12,617
15,571
LATAM
GROUP
2024
› 394
13 / FINANCIAL STATEMENTS
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Revenue
91,367
75,007
Cost of sales
(53,538)
(45,009)
Income (loss) from the operational activities
37,829
29,998
Income (loss) before taxes
2,522
1,894
Income tax benefits/(expense)
(302)
(374)
NET INCOME (LOSS) FOR THE YEAR
2,220
1,520
Income attributable to owners of the parent company
2,220
1,520
NET INCOME (LOSS) FOR THE YEAR
2,220
1,520
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
2,220
1,520
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
2,220
1,520
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
2,220
1,520
TOTAL COMPREHENSIVE INCOME (LOSS)
2,220
1,520
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
2,434
(831)
Net cash (outflow) inflow from investing activities
-
-
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
-
-
Net (decrease) increase in cash and cash equivalents
2,434
(831)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
621
1,452
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
3,055
621
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
4,628
-
4,628
Total comprehensive income
2,220
-
2,220
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2024
6,848
-
6,848
EQUITY 2023
Equity as of January 1, 2023
3,108
-
3,108
Total comprehensive income
1,520
-
1,520
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2023
4,628
-
4,628
LATAM
GROUP
2024
› 395
13 / FINANCIAL STATEMENTS
HOLDCO I S.A.
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
1
-
Total non-current assets
351,587
351,587
Total assets
351,588
351,587
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
3,873
3,791
Total non-current liabilities
-
-
Total liabilities
3,873
3,791
EQUITY
Parent’s ownership interest
347,715
347,796
Total equity
347,715
347,796
Total liabilities and equity
351,588
351,587
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Income (loss) from the operational activities
(556)
(653)
Income (loss) before taxes
(81)
(554)
Income tax benefits/(expense)
-
-
NET INCOME (LOSS) FOR THE YEAR
(81)
(554)
Income (loss) attributable to owners of the parent company
(81)
(554)
NET INCOME (LOSS) FOR THE YEAR
(81)
(554)
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
(81)
(554)
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
(81)
(554)
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(81)
(554)
TOTAL COMPREHENSIVE INCOME
(81)
(554)
LATAM
GROUP
2024
› 396
13 / FINANCIAL STATEMENTS
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
-
-
Net cash (outflow) inflow from investing activities
-
-
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
-
-
Net (decrease) increase in cash and cash equivalents
-
-
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
-
-
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
-
-
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
347,796
-
347,796
Total comprehensive income
(81)
-
(81)
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2024
347,715
-
347,715
EQUITY 2023
Equity as of January 1, 2023
348,350
-
348,350
Total comprehensive income
(554)
-
(554)
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2023
347,796
-
347,796
JARLETUL S.A.
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
12
16
Total non-current assets
-
-
Total assets
12
16
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
1,101
1,101
Total non-current liabilities
-
-
Total liabilities
1,101
1,101
EQUITY
Parent’s ownership interest
(1,089)
(1,085)
Total equity
(1,089)
(1,085)
Total liabilities and equity
12
16
LATAM
GROUP
2024
› 397
13 / FINANCIAL STATEMENTS
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Income (loss) from the operational activities
(3)
7
Income (loss) before taxes
(4)
8
Income tax benefits/(expense)
-
-
NET INCOME (LOSS) FOR THE YEAR
(4)
8
Income (loss) attributable to owners of the parent company
(4)
8
NET INCOME (LOSS) FOR THE YEAR
(4)
8
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
(4)
8
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
(4)
8
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(4)
8
TOTAL COMPREHENSIVE INCOME
(4)
8
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
(1)
(6)
Net cash (outflow) inflow from investing activities
-
-
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
(1)
(1)
Net (decrease) increase in cash and cash equivalents
(2)
(7)
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
8
15
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
6
8
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
(1,085)
-
(1,085)
Total comprehensive income
(4)
-
(4)
Closing balance as of December 31, 2024
(1,089)
-
(1,089)
EQUITY 2023
Equity as of January 1, 2023
(1,093)
-
(1,093)
Total comprehensive income
8
-
8
Closing balance as of December 31, 2023
(1,085)
-
(1,085)
LATAM
GROUP
2024
› 398
13 / FINANCIAL STATEMENTS
LATAM AIRLINES PERÚ S.A.
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
401,748
312,628
Total non-current assets
36,020
21,853
Total assets
437,768
334,481
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
342,838
281,208
Total non-current liabilities
23,251
4,437
Total liabilities
366,089
285,645
EQUITY
Parent’s ownership interest
71,679
48,836
Total equity
71,679
48,836
Total liabilities and equity
437,768
334,481
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Revenue
1,723,497
1,404,081
Cost of sales
(1,471,590)
(1,271,863)
Income (loss) from the operational activities
251,907
132,218
Income (loss) before taxes
34,884
(4,341)
Income tax benefits/(expense)
(12,042)
(325)
NET INCOME (LOSS) FOR THE YEAR
22,842
(4,666)
Income attributable to owners of the parent company
22,842
(4,666)
NET INCOME (LOSS) FOR THE YEAR
22,842
(4,666)
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
22,842
(4,666)
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
22,842
(4,666)
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
22,842
(4,666)
TOTAL COMPREHENSIVE INCOME (LOSS)
22,842
(4,666)
LATAM
GROUP
2024
› 399
13 / FINANCIAL STATEMENTS
LATAM TRAVEL CHILE II S.A.
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
22
21
Total non-current assets
336
336
Total assets
358
357
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
1,243
1,240
Total non-current liabilities
-
-
Total liabilities
1,243
1,240
EQUITY
Parent’s ownership interest
(885)
(883)
Total equity
(885)
(883)
Total liabilities and equity
358
357
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
14,911
43,277
Net cash (outflow) inflow from investing activities
(5,365)
(1,751)
Net cash inflow (outflow) from financing activities
(1,148)
(91)
Effects of variation in the exchange rate on cash and cash equivalents
-
-
Net (decrease) increase in cash and cash equivalents
8,398
41,435
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
97,685
56,250
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
106,083
97,685
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
48,836
-
48,836
Total comprehensive income
22,843
-
22,843
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2024
71,679
-
71,679
EQUITY 2023
Equity as of January 1, 2023
54,595
-
54,595
Total comprehensive income
(4,666)
-
(4,666)
Total transactions with shareholders
(1,093)
-
(1,093)
Closing balance as of December 31, 2023
48,836
-
48,836
LATAM
GROUP
2024
› 400
13 / FINANCIAL STATEMENTS
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Income (loss) from the operational activities
(2)
(16)
Income (loss) before taxes
(2)
(16)
Income tax benefits/(expense)
-
-
NET INCOME (LOSS) FOR THE YEAR
(2)
(16)
Income attributable to owners of the parent company
(2)
(16)
NET INCOME (LOSS) FOR THE YEAR
(2)
(16)
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
(2)
(16)
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
(2)
(16)
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(2)
(16)
TOTAL COMPREHENSIVE INCOME (LOSS)
(2)
(16)
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
-
-
Net cash (outflow) inflow from investing activities
-
-
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
-
-
Net (decrease) increase in cash and cash equivalents
-
-
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
20
20
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
20
20
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
(883)
-
(883)
Total comprehensive income
(2)
-
(2)
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2024
(885)
-
(885)
EQUITY 2023
Equity as of January 1, 2023
(867)
-
(867)
Total comprehensive income
(16)
-
(16)
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2023
(883)
-
(883)
LATAM
GROUP
2024
› 401
13 / FINANCIAL STATEMENTS
LATAM TRAVEL S.A.
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
4,039,551
3,648,806
Total non-current assets
-
118,296
Total assets
4,039,551
3,767,102
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
33,303
577,202
Total non-current liabilities
1,663,616
709,536
Total liabilities
1,696,919
1,286,738
EQUITY
Parent’s ownership interest
2,342,632
2,480,364
Total equity
2,342,632
2,480,364
Total liabilities and equity
4,039,551
3,767,102
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Revenue
952,392
2,013,547
Cost of sales
(1,066)
(495)
Income (loss) from the operational activities
951,326
2,013,052
Income (loss) before taxes
(3,748,905)
778,318
Income tax benefits/(expense)
(1,119)
-
NET INCOME (LOSS) FOR THE YEAR
(3,750,024)
778,318
Income attributable to owners of the parent company
(3,750,024)
778,318
NET INCOME (LOSS) FOR THE YEAR
(3,750,024)
778,318
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
(3,750,024)
778,318
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
(3,750,024)
778,318
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
(3,750,024)
778,318
TOTAL COMPREHENSIVE INCOME (LOSS)
(3,750,024)
778,318
LATAM
GROUP
2024
› 402
13 / FINANCIAL STATEMENTS
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
(767,273)
(2,553,495)
Net cash (outflow) inflow from investing activities
796,743
1,364,128
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
649,252
2,794,378
Net (decrease) increase in cash and cash equivalents
678,722
1,605,011
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
2,398,850
793,839
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
3,077,572
2,398,850
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
2,480,364
-
2,480,364
Total comprehensive income
(3,750,024)
-
(3,750,024)
Total transactions with shareholders
3,612,292
-
3,612,292
Closing balance as of December 31, 2024
2,342,632
-
2,342,632
EQUITY 2023
Equity as of January 1, 2023
840,714
-
840,714
Total comprehensive income
778,318
-
778,318
Total transactions with shareholders
861,332
-
861,332
Closing balance as of December 31, 2023
2,480,364
-
2,480,364
LATAM TRAVEL S.R.L.
Estado de Situación Financiera
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
93
93
Total non-current assets
-
-
Total assets
93
93
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
-
-
Total non-current liabilities
-
-
Total liabilities
-
-
EQUITY
Parent’s ownership interest
93
93
Total equity
93
93
Total liabilities and equity
93
93
LATAM
GROUP
2024
› 403
13 / FINANCIAL STATEMENTS
Estado de Resultados Consolidados por Función
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Income (loss) from the operational activities
-
5
Income (loss) before taxes
-
5
Income tax benefits/(expense)
-
-
NET INCOME (LOSS) FOR THE YEAR
-
5
Income attributable to owners of the parent company
-
5
NET INCOME (LOSS) FOR THE YEAR
-
5
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
-
5
Total Other comprehensive income (loss)
-
-
Total comprehensive income (loss)
-
5
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
-
5
TOTAL COMPREHENSIVE INCOME (LOSS)
-
5
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
-
-
Net cash (outflow) inflow from investing activities
-
-
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
-
-
Net (decrease) increase in cash and cash equivalents
-
-
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
64
64
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
64
64
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
93
-
93
Total comprehensive income
-
-
-
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2024
93
-
93
EQUITY 2023
Equity as of January 1, 2023
88
-
88
Total comprehensive income
5
-
5
Total transactions with shareholders
-
-
-
Closing balance as of December 31, 2023
93
-
93
LATAM
GROUP
2024
› 404
13 / FINANCIAL STATEMENTS
PEUCO FINANCE LIMITED
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
-
-
Total non-current assets
-
-
Total assets
-
-
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
-
-
Total non-current liabilities
-
-
Total liabilities
-
-
EQUITY
Parent’s ownership interest
-
-
Total equity
-
-
Total liabilities and equity
-
-
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Income (loss) from the operational activities
-
-
Income (loss) before taxes
-
-
Income tax benefits/(expense)
-
-
NET INCOME (LOSS) FOR THE YEAR
-
-
Income attributable to owners of the parent company
-
-
NET INCOME (LOSS) FOR THE YEAR
-
-
LATAM
GROUP
2024
› 405
13 / FINANCIAL STATEMENTS
TAM S.A. AND SUBSIDIARY
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
2,575,407
2,441,250
Total non-current assets
1,495,062
1,798,452
Total assets
4,070,469
4,239,702
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
1,919,471
2,042,204
Total non-current liabilities
637,571
985,169
Total liabilities
2,557,042
3,027,373
EQUITY
Parent’s ownership interest
1,512,327
1,211,177
Participaciones no controladoras
1,100
1,152
Total equity
1,513,427
1,212,329
Total liabilities and equity
4,070,469
4,239,702
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Revenue
6,313,297
5,794,599
Cost of sales
(5,137,469)
(4,587,151)
Income (loss) from the operational activities
1,175,828
1,207,448
Income (loss) before taxes
714,397
739,480
Income tax benefits/(expense)
(40,749)
1,303
NET INCOME (LOSS) FOR THE YEAR
673,648
740,783
Income attributable to owners of the parent company
673,327
740,476
Income (Loss) attributable to non-controlling interest
321
307
NET INCOME (LOSS) FOR THE YEAR
673,648
740,783
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
673,648
740,783
Total Other comprehensive income (loss)
(390,371)
804,936
Total comprehensive income (loss)
283,277
1,545,719
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
282,788
1,545,328
Comprehensive income (loss) attributable to non-controlling interests
489
391
TOTAL COMPREHENSIVE INCOME (LOSS)
283,277
1,545,719
LATAM
GROUP
2024
› 406
13 / FINANCIAL STATEMENTS
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
194,695
364,469
Net cash (outflow) inflow from investing activities
(352)
(31,311)
Net cash inflow (outflow) from financing activities
(13,668)
(18,698)
Effects of variation in the exchange rate on cash and cash equivalents
(110,436)
35,214
Net (decrease) increase in cash and cash equivalents
70,239
349,674
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
733,807
384,133
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
804,046
733,807
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
1,211,177
1,152
1,212,329
Total comprehensive income
282,788
489
283,277
Total transactions with shareholders
18,362
(541)
17,821
Closing balance as of December 31, 2024
1,512,327
1,100
1,513,427
EQUITY 2023
Equity as of January 1, 2023
(734,515)
815
(733,700)
Total comprehensive income
1,545,335
391
1,545,726
Total transactions with shareholders
400,357
(54)
400,303
Closing balance as of December 31, 2023
1,211,177
1,152
1,212,329
TECHNICAL TRAINING LATAM S.A.
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
ASSETS
Total current assets
1,089,498
977,726
Total non-current assets
143,702
115,135
Total assets
1,233,200
1,092,861
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
266,650
396,039
Total non-current liabilities
470,337
386,878
Total liabilities
736,987
782,917
EQUITY
Parent’s ownership interest
496,213
309,944
Total equity
496,213
309,944
Total liabilities and equity
1,233,200
1,092,861
LATAM
GROUP
2024
› 407
13 / FINANCIAL STATEMENTS
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Revenue
1,319,335
1,110,860
Cost of sales
(997,548)
(955,841)
Income (loss) from the operational activities
321,787
155,019
Income (loss) before taxes
361,382
153,438
Income tax benefits/(expense)
(137,906)
(44,699)
NET INCOME (LOSS) FOR THE YEAR
223,476
108,739
Income attributable to owners of the parent company
223,476
108,739
NET INCOME (LOSS) FOR THE YEAR
223,476
108,739
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
NET INCOME/(LOSS)
223,476
108,739
Total Other comprehensive income (loss)
(37,207)
(63,382)
Total comprehensive income (loss)
186,269
45,357
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
186,269
45,357
TOTAL COMPREHENSIVE INCOME (LOSS)
186,269
45,357
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
AS OF
DECEMBER 31,
2023
THUS$
Net cash (outflow) inflow from operating activities
(99,797)
(3,269)
Net cash (outflow) inflow from investing activities
-
-
Net cash inflow (outflow) from financing activities
-
-
Effects of variation in the exchange rate on cash and cash equivalents
9,683
4,489
Net (decrease) increase in cash and cash equivalents
(90,114)
1,220
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
137,689
136,469
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
47,575
137,689
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
EQUITY 2024
Equity as of January 1, 2024
309,944
-
309,944
Total comprehensive income
186,269
-
186,269
Closing balance as of December 31, 2024
496,213
-
496,213
EQUITY 2023
Equity as of January 1, 2023
264,587
-
264,587
Total comprehensive income
45,357
-
45,357
Closing balance as of December 31, 2023
309,944
-
309,944
LATAM
GROUP
2024
› 408
13 / FINANCIAL STATEMENTS
FAISAN FINANCE DAC
Statements of Financial Position
AS OF
DECEMBER 31,
2024
THUS$
ASSETS
Total current assets
-
Total non-current assets
-
Total assets
-
LIABILITIES AND EQUITY
LIABILITIES
Total current liabilities
-
Total non-current liabilities
-
Total liabilities
-
EQUITY
Parent’s ownership interest
-
Total equity
-
Total liabilities and equity
-
Statements of Income by Function
AS OF
DECEMBER 31,
2024
THUS$
Income (loss) from the operational activities
-
Income (loss) before taxes
-
Income tax benefits/(expense)
-
NET INCOME (LOSS) FOR THE YEAR
-
Income (loss) attributable to owners of the parent company
-
NET INCOME (LOSS) FOR THE YEAR
-
Statements of Comprehensive Income
AS OF
DECEMBER 31,
2024
THUS$
NET INCOME/(LOSS)
-
Total Other comprehensive income (loss)
-
Total comprehensive income (loss)
-
COMPREHENSIVE INCOME ATTRIBUTABLE TO:
Comprehensive income (loss) attributable to owners of the parent
company
-
TOTAL COMPREHENSIVE INCOME
-
13 / FINANCIAL STATEMENTS
Statements of Cash Flows - Direct Method
AS OF
DECEMBER 31,
2024
THUS$
Net cash (outflow) inflow from operating activities
-
Net cash (outflow) inflow from investing activities
-
Net cash inflow (outflow) from financing activities
-
Effects of variation in the exchange rate on cash and cash equivalents
-
Net (decrease) increase in cash and cash equivalents
-
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR
-
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
-
Statements of Changes in Equity
PARENT’S
OWNERSHIP
INTEREST
THUS$
NON-
CONTROLLING
INTEREST
THUS$
TOTAL
EQUITY
THUS$
PATRIMONIO 2024
Equity as of January 1, 2024
-
-
-
Total comprehensive income
-
-
-
Closing balance as of December 31, 2024
-
-
-
Cancún, México
GRUPO
LATAM
2024
› 409
LATAM
GROUP
2024
› 410
13 / FINANCIAL STATEMENTS
FINANCIAL ANALYSIS
Brasilia, Brasil
Comparative analysis and explanation of main trends:
CONSOLIDATED FINANCIAL STATEMENT
Below, we are presenting the main financial indicators in the Consolidated Financial Statement:
31-12-2024
31-12-2023
LIQUIDITY INDICATORS
Current liquidity (times) (Current assets in operation/current liabilities)
0.62
0.74
Acid test (times) (Funds available/ current liabilities)
0.31
0.30
INDEBTEDNESS INDICATORS
Indebtedness ratio (times):
8.70
12.63
(Non-current Liability/ Net Worth)
11.41
18.97
(Current liabilities + non-current liabilities/ Net worth)
20.11
31.60
Current debt/ Total debt (%)
43.26
39.98
Non-current debt/ Total debt (%)
56.74
60.02
Hedging of financial expenses (EBIT / financial expenses)
2.34
2.04
ACTIVITY INDICATORS
Total Assets
15,253,365
14,667,315
Investments
1,419,875
863,839
Disposal of property
97,303
46,524
PROFITABILITY INDICATORS
Profitability indicators are calculated on equity and income attributable to owners of parent.
Return on equity (Net income / net equity average)
1.66
2.36
Return on assets (Net income/ average assets)
0.07
0.04
Average return on operating assets (Net income / operating assets (*)
0.07
0.04
Dividend returns (Dividends paid/ market price)
0.02
0.00
(*) Total assets less deferred taxes, personnel accounts, permanent and temporary investments.
LATAM
GROUP
2024
› 411
13 / FINANCIAL STATEMENTS
At December 31, 2024, the company's assets totaled
ThUS$15,253,365 which, compared to December
31, 2023, represents an increase of ThUS$586,050
(4.0%).
The Company's current assets decreased by
ThUS$302,943 (7.2%) vs. yearend 2023. The decreases
were seen in the following line items: Trade and
other receivables for ThUS$222,203 (16.0%), Current
inventories for ThUS$154,350 (26.0%), Consumption-
related for ThUS$396,668; Translation adjustment
and others for ThUS$309,334 offset by increases in
purchases by ThUS$552,251; Other financial assets,
current, for ThUS$107,524 (61.5%), Non-current
assets or groups of assets for disposal classified
as held for sale for ThUS$73,532 (71.6%); Current
taxes for ThUS$(6,755) (14.4%). All the above is
offset by an increase in Cash and cash equivalents
of ThUS$243,027 (14.2%), explained by the net
variation in the Company's consolidated cash flow
statement; Other non-financial assets, current, for
ThUS$18,397 (9.9%) and Accounts receivable from
related entities, current, for ThUS$3 (10.7%).
The Company's liquidity index showed a decrease
from 0.74 times at yearend 2023 to 0.62 times at the
end of December 2024. Moreover, we can see that
the quick ratio increased from 0.30 times at yearend
2023 to 0.31 times at the end of December 2024.
The Company's non-current assets increased by
ThUS$888,993 (8.5%) vs. yearend 2023. The line items
of Non-current assets with increases are: Property,
Plant and Equipment by ThUS$1,095,567 (12.1%),
which is explained by: additions of ThUS$1,254,173,
additions and renegotiations for right-of-use assets of
ThUS$836,167, reclassifications and other movements
of ThUS$289,260; offset by decreases originated by
the ThUS$1,111,101 depreciation for the year and
the translation difference of ThUS$172,932; Other
non-current financial assets for ThUS$19,287 (55.9%)
and Deferred tax assets for ThUS$5,767 (120.6%).
All of the above is offset by decreases in the following
line items: Intangible assets other than goodwill for
ThUS$151,816 (13.2%), mainly originated by the
negative variation of the translation adjustment of
ThUS$203,259 and ThUS$72,555 corresponding to
the amortization of the year, offset by the increase
in additions of ThUS$124,266; Other non-financial
assets for ThUS$79,205 (47.0%), originated by the
decrease in judicial deposits for ThUS$90,300, and
Sales tax for ThUS$6,853; slightly offset by other
prepayments for ThUS$18,416; and Accounts
receivable, non-current, for ThUS$607 (4.7%).
At December 31, 2024, the company's liabilities totaled
ThUS$14,542,036 which, compared to December
31, 2023, represents an increase of ThUS$312,996
(2.2%).
The Company's Current Liabilities increased by
ThUS$602,707 (11.8%) vs. yearend 2023. The increases
were seen in the following line items: Trade and other
accounts payable, current, for ThUS$368,293 (20.9%),
Other financial liabilities, current, for ThUS$39,150
(6.6%); Tax liabilities, current, for ThUS$3,910; Other
non-financial liabilities, current, for ThUS$186,774
(5.7%) and Accounts payable to related entities,
current, for ThUS$5,431 (73.0%). The above is offset
by the ThUS$851 (5.6%) decrease in Other provisions,
current.
The indebtedness indicator of the Company's current
Liabilities over Equity for the period stood at 8.70
(12.63 by December 31, 2023). The impact of
current Liabilities over Total Debt increased by 3.28
percentage points, from 39.98% at yearend 2023 to
43.26% at the end of the current period.
The Company's non-current Liabilities decreased by
THUS$289,711 (24.1%), compared to the sum reached
by December 31, 2023. The main decreases were
seen in the following line items: Other non-financial
non-current liabilities for ThUS$208,692 (59.8%);
Deferred tax liabilities for ThUS$69,682 (18.2%);
and Other non-current provisions for ThUS$302,890
(32.7%). This is offset by the increase in Accounts
payable, non-current, of ThUS$73,175 (17.5%), mainly
explained by the increase in aircraft and engine
maintenance of ThUS$84,869, offset by other net
effects of ThUS$11,694. Other non-current financial
liabilities of ThUS$173,569 (2.7%) and provisions
for employee benefits of ThUS$44,809 (36.5%),
explained by an increase of ThUS$88,112 related
to the provision for current services, offset by a
decrease for benefits paid of ThUS$10,778, actuarial
loss of ThUS$21,769 and translation adjustment of
ThUS$10,756.
For a better understanding of the total increase of
ThUS$214,263 in Other financial liabilities, considering
the increases of ThUS$40,694 and ThUS$173,569 in
the current and non-current segments, respectively,
the following table, excluding the increase in hedging
derivatives contracts for ThUS$(1,544), shows the
movements corresponding to cash flows and non-
cash flows:
LATAM
GROUP
2024
› 412
13 / FINANCIAL STATEMENTS
OBLIGATIONS WITH FINANCIAL
INSTITUTIONS
US$
BALANCE AS OF
DECEMBER 31,
2023
US$
FLOWS
NON-CASH
MOVEMENTS
BALANCE AS OF
DECEMBER 31,
2024
US$
OBTAINING
PAYMENT
INTEREST
ACCRUED AND
OTHERS
US$
CAPITAL
US$
CAPITAL
US$
(US$)
US$
OTHER FLOWS
US$
Bank loans
0
-1.089.000
-167.026
0
-
226.592
-
Secured obligations
99.000
-28.938
-19.908
0
-
19.967
374.043
Other secured obligations
272.112
-330.870
-39.066
0
-
42.225
374.751
Public obligations
1.378.948
-450.000
-156.862
-10.870
(10.870)
175.249
2.239.303
Finance leases
0
-105.734
-46.596
0
-
50.557
799.773
Other loans
0
0
0
0
-
(104)
-
Lease liabilities
0
-344.038
-288.176
0
-
1.026.801
3.362.581
Total Obligations with financial institutions
1.750.060
-2.348.580
-717.634
-10.870
(10.870)
1.541.287
7.150.451
The indebtedness indicator of the company's Non-
current liabilities over equity stood at 11.41. The
impact of non-current Liabilities on total debt
decreased by 3.28 percentage points, from 60.02%
at yearend 2023 to 56.74% at the end of December
2024.
The indicator of total indebtedness over the Company's
equity at the end of December 2024 is 20.11, 11.49
lower than at the end of December 2023.
Up to December 31, 2024, roughly 76% of debt has
a fixed rate; most of the variable debt is indexed
at the benchmark rate based on SOFR (50% by
December 31, 2023).
The Equity attributable to the owners of the parent
company increased by ThUS$272,965 (60.6%), going
from ThUS$450,302 by December 31, 2023 to an
Equity of ThUS$723,267 by December 31, 2024.
The main effects correspond to:
a) Other reserves
As at December 31, 2024, the Other reserves item
shows a negative variation of ThUS$410,915, mainly
explained by the negative variations in Actuarial
reserves for Employee Benefit Plans of ThUS$20,855;
a translation reserve of ThUS$379,049 and Reserves
related to hedging activities for ThUS$11,521, offset
by the positive variation of ThUS$510 in Other
reserves.
b) Accrued Earnings/Loss (Accrued Profit/Loss).
As at December 31, 2024, retained earnings include
earnings of ThUS$976,972 attributable to owners of
the parent company and the provision on 2024 results
corresponding to 30% of the minimum mandatory
dividends for ThUS$293,092.
Therefore, the accrued result increased from a profit
of ThUS$464,411 at December 31, 2023 to a profit
of ThUS$1,148,291 at December 31, 2024.
LATAM
GROUP
2024
› 413
13 / FINANCIAL STATEMENTS
CONSOLIDATED INCOME STATEMENT
Below, we present the main financial indicators in the Consolidated Financial Statement.
For the years ended on December 31
2024
THUS$
2023
THUS$
Operating income
13.033.712
11.789.182
Passengers
11.233.287
10.215.148
Cargo
1.599.756
1.425.393
Others
200.669
148.641
Operating Costs
(11.492.664)
(10.711.017)
Compensation
(1.738.474)
(1.583.337)
Fuel
(3.970.077)
(3.947.220)
Fees
(230.127)
(244.160)
Depreciation and Amortization
(1.447.656)
(1.205.373)
Other Leasing and Landing Fees
(1.470.057)
(1.322.795)
Passenger Services
(331.918)
(271.838)
Aircraft Leasing
(4.164)
(91.876)
Maintenance
(815.916)
(601.804)
Other Operating Costs
(1.448.052)
(1.351.571)
Other gains/(losses)
(36.223)
(91.043)
Operating Results
1.541.048
1.078.165
Operating Margin
11,8 %
9,1 %
Financial Revenues
142.411
125.356
Financial costs
(881.950)
(698.231)
F/X difference
172.917
85.891
Earnings expressed in inflation-adjusted units
19.508
5.311
2024
THUS$
2023
THUS$
Gain/(loss), before taxes and minority interest
993,934
596,492
Taxes
(16,489)
(14,942)
Gain/(loss), before minority interest
Attributable to:
977,445
581,550
Gain/(Loss) attributable to the parent company's owners
976,972
581,831
Gain/(Loss) attributable to non-controlling interests
473
(281)
Net Margin
7.5 %
4.9 %
Effective Tax Rate
(1.7) %
(2.5) %
Total shares, basic
604,437,877,587
604,437,869,545
Basic gain per share (US$)
0.001616
0.000963
Total shares, diluted
604,441,789,335
604,441,789,335
Gain diluted per share (US$)
0.001616
0.000963
EBITDA (*)
3,181,129
2,374,740
(*) EBITDA = Earnings for the period + Tax + Net interest + Depreciation and Amortization.
LATAM
GROUP
2024
› 414
13 / FINANCIAL STATEMENTS
At December 31, 2024, the controlling company
reported a ThUS$976,972 gain, translating into a
positive variation of ThUS$395,141 vs. the previous
year’s profit of ThUS$581,831. Net margin for the
financial year settled 7.5% in 2024 and 4.9% during
2023.
The operating result for 2024 shows a gain of
ThUS$1,541,048 which, compared to the gain of
ThUS$1,078,165 up to December 31, 2023, represents
a variation equivalent to 42.9%. Operating margin
showed a positive variation of 2.7 percentage points
compared to financial year 2023, reaching 11.8%,
mainly driven by a good performance in the passenger
business.
Operating income up to December 31, 2024,
increased 10.6% vs. the same period of 2023, totaling
ThUS$13,033,712. This increase is largely due to
a 10.0% hike in PAX Revenues and 12.2% in Cargo
Revenues, while Other Revenues showed a positive
change of 35.0%. The effect of the Brazilian Real’s
depreciation represents lower Ordinary Revenues
by around US$278 million.
PAX revenues totaled ThUS$11,233,287 which,
compared to the ThUS$10,215,148 reported up to
December 31, 2023, translates into a 10.0% increase.
This variation is due to a 16.8% increase in demand
measured in RPK and a 1.2% rise in load factor, which
reached 84.3%—1.2 percentage points higher than
in financial year 2023—partially offset by a 5.8%
drop in yield.
As at December 31, 2024, Cargo Revenues reached
ThUS$1,599,756, which represents an increase of
12.2% compared to 2023; this increase was mainly
due to a 16.9% hike in traffic measured in RTK and
a 4.0% rise in yield.
Other Income grew by ThUS$52,028, mainly due to
higher income recognized from non-airline product
redemptions in the Latam Pass program, tour services
and the code-sharing agreement with Iberia, which
makes it possible to offer more flight options between
Spain and South America.
Up to December 31, 2024, Operating Costs totaled
ThUS$11,492,664 which, compared to financial year
2023, translates into an increase of 7.3%, equivalent
to ThUS$781,647. On the other hand, the unit cost
per ASK decreased by 6.8%. Furthermore, the effect
of the Brazilian Real’s depreciation on this line item
translates into lower costs by roughly US$172 million.
Item variations are explained as follows:
a) Remuneration and benefits increased by ThUS$155,137,
mainly due to higher crew and airport personnel
expenses, together with a 9% increase in the average
headcount during 2024.
b) Fuel increased 0.6%, equivalent to ThUS$22,857.
This increase corresponds mainly to 13.6% growth in
consumption measured in gallons, offset by 12.2%
lower average unhedged prices. In 2024, the Company
recognized a loss of ThUS$18,139 due to fuel hedges,
compared to a ThUS$15,688 profit in 2023.
c) Agent commissions show a decrease of ThUS$14,033,
as a result of the digital penetration mix, which
prioritizes and encourages direct sales.
d) Depreciation and Amortization increased by
ThUS$242,283, equivalent to 20.1%—a variation that
is mainly explained by the use of a newer fleet and
a higher average number of aircraft up to December
31, 2024 compared to 2023.
e) Other Leases and Aviation Fees increased
ThUS$147,262, mainly in the costs of airport charges
and handling services, impacted by a greater operation
and utilization of larger aircraft, fee updates in
domestic and international airports and the effects
of inflationary readjustments during 2024.
f) Passenger Services show higher costs by ThUS$60,080,
which translates into a variation of 22.1%, mainly
explained by an increase in catering and in-flight
service costs, due to the growth in demand, which
translates into an increase of 11% in the number of
passengers transported, mainly in the international
segment.
g) Aircraft Leasing shows lower costs of ThUS$87,712,
due to a significant reduction in the number of aircraft
under the PBH (power by the hour) modality, as a
result of the expiration of almost all contracts, with
only one aircraft remaining under this modality at
yearend 2024. Aircraft Leasing includes the costs
associated with PBH lease payments for contracts that
have been modified by incorporating that structure.
For these contracts that include variable payments
based on flight times (PBH) at the beginning of the
period and after that, have fixed fees, an asset by
right of use and a lease liability were recognized for
these amounts at the date of contract modification.
These sums continue to be amortized on a linear
basis during the term of the lease from the date of
contract modification, even if at the beginning they
have a variable payment period. Therefore, and as a
result of the application of the lease accounting policy,
the result of the period includes both the leasing
expense for variable payments (Aircraft Leasing)
and the expense resulting from the amortization of
the asset by right of use included in the depreciation
line and the interest on the lease liability.
h) Maintenance shows higher costs of ThUS$214,112,
as a result of a larger average fleet, and increases
in the operation and cycles of both passengers and
cargo. In addition, there were increased escalation
costs associated with changes in supply chains, as
well as the cost of returning certain aircraft.
i) Other Operating Expenses increased by ThUS$96,481,
mainly due to the effect of higher variable costs of
crew, booking systems, sales and advertising, which
are the result of the growth of the operation during
2024.
j) Other gains / (losses) totaled a negative result
of ThUS$36,223 as at December 31, 2024, which
is mainly explained by higher expenses related to
labor proceedings in Argentina; in addition, this item
includes others related to non-current operations, fair
value adjustments and other non-recurring effects.
Financial income totaled ThUS$142,411 which,
compared to the ThUS$125,356 of the previous year,
represents higher income by ThUS$17,055, mainly
due to a higher level of cash and cash equivalents
compared to 2023, which has been invested mainly
in bank term deposits.
Financial costs increased 26.3% translating into
ThUS$183,719 as at December 31, 2024. This
variation is mainly the effect of an environment of
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
high average interest rates, one-time costs related to
the prepayment of the Chapter 11 debt in October
2024, as well as an increase in the fleet’s operating
leases due to a greater number of aircraft during
the current year.
ANALYSIS AND EXPLANATION OF
CONSOLIDATED NET CASH FLOW
GENERATED BY OPERATION, INVESTMENT,
AND FINANCING ACTIVITIES
The Operating Cash Flow up to December 31, 2024
shows a positive change of ThUS$842,759 vs. the
same period of the previous year, due to the positive
change in Receipts from sales of goods and services
rendered for ThUS$640,463, Other receipts from
operational activities for ThUS$43,058, Payments
to suppliers for goods and services rendered,
whose variations are due to lower payments made
for ThUS$231,259, and Other cash inflows and
outflows for ThUS$142,499. The above is offset by
negative variations of ThUS$25,060 in Income taxes
paid, Payments to and on behalf of employees for
Parque nacional de los Elefantes de Addo, Sudáfrica
ThUS$115,129 and Other payments for operating
activities for ThUS$74,331.
The positive variation of ThUS$142,499 in the
Other cash inflows and outflows of the Cash Flow
from Operating Activities is mainly due to the
ThUS$18,852 variation in Hedging Derivatives,
higher recoveries associated to Guarantees for
ThUS$68,668, mainly explained by recoveries
associated to guarantees of civil liability insurance
for ThUS$41,000; guarantees associated to financial
payment processing and collections supplier for
ThUS$15,500, airport guarantees for ThUS$15,482,
judicial deposits for ThUS$70,705 and insurance
recovery from an engine warranty for ThUS$9,788
corresponding to an incident in Colombia, offset by
the negative variation of ThUS$3,760 in Taxes on
financial transactions, Funds received associated
to restricted advances for ThUS$20,572, and Bank
fees and taxes for ThUS$1,182.
The Cash Flow from Investment Activities shows
a negative variation of ThUS$510,161 compared
to the same period of the previous year, mainly due
to the negative variations in Purchases of Property,
Plant and Equipment for ThUS$529,676 due to larger
purchases of aircraft for ThUS$395,402, Pre-delivery
payments (PDP) for ThUS$142,390, maintenance
for ThUS$24,569, and cabin improvements for
ThUS$44,659, offset by lower purchases of spare
parts for ThUS$66,702 and rotables for ThUS$21,344;
Purchases of intangible assets for ThUS$26,360,
and Other cash inflows (outflows) for ThUS$24,789.
The above is offset by positive variations in Interest
received for ThUS$19,885; Sums from the sale of
property, plant and equipment for ThUS$50,779
mainly associated with higher sales of aircraft for
ThUS$61,361 and offset by lower sales of engines
for ThUS$10,583.
The Cash Flow from Financing Activities shows a
negative variation of ThUS$414,646, compared
to the same period of the previous year, which
is mainly explained by the negative variations in
Interest paid of ThUS$123,400, mainly associated
to higher payments for Term Loan B (TLB), higher
interest rates in 2024 (SOFR), and the end of the
power by the hour (PBH) period, ThUS$174,838 in
Dividends paid (see note 34 (c)), ThUS$118,680 in
Lease liability payments associated to new contracts,
and the end of the power by the hour (PBH) period
for most of the operating fleet, Other cash inflows
(outflows) for ThUS$85,274, mainly associated to
the one-time payment of fees resulting from the
extension of the revolving credit facility (RCF) and
ThUS$1,662,537 in Loan payments, mainly explained
by the ThUS$1,080,750 prepayment of bank loans
and ThUS$450,000 of secured bonds. These variations
are offset by the positive variation in securing long-
term loans for ThUS$1,750,060, mainly due to the
issuance of secured bonds.
Last, the Company’s net cash flow up to December 31,
2024, prior to the effects of exchange rate differences,
shows a negative variation of ThUS$82,048, compared
to the same period of a year earlier.
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GROUP
2024
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13 / FINANCIAL STATEMENTS
FINANCIAL RISK ANALYSIS
The goal of the Company’s global risk management
program is to minimize the adverse effects of the
financial risks that affect the company.
⚫ Market risk
Given the nature of its business, the Company is
exposed to market factors, such as: (i) fuel price
risk, (ii) exchange rate risk, and (iii) Interest rate risk.
i. Fuel price risk
To carry out its operations, the Company purchases
fuel known as USGC 54 grade Jet Fuel, which is
subject to variations in international fuel prices.
To hedge against fuel risk exposure, the Company
trades in derivatives instruments (Swaps and Options)
whose underlying assets may be different from
Jet Fuel, whereby it is possible to hedge in West
Texas Intermediate crude oil (“WTI”), Brent crude oil
(“BRENT”), and distilled Heating Oil (”HO”), which can
be closely related to Jet Fuel and can have greater
liquidity.
At December 31, 2024, the Company recognized
ThUS$18,140 in losses from fuel hedges net of
premiums on the cost of sales of the period. Part of
the spreads resulting between the lower and higher
market value of these contracts is recognized as a
hedge reserves component in the company's net
equity.
At December 31, 2024, the market value of fuel
hedging positions totaled ThUS$7,747. At December
31, 2023, the market value of fuel hedging positions
totaled ThUS$22,136.
ii. Exchange rate risk
The functional currency, also used in presenting
the Parent company's Financial Statements, is the
US dollar; therefore, Transactional and Conversion
exchange rate risks are mainly a result of the
operating activities of the business, as well as the
company's strategic and accounting activities, which
are presented in monetary units other than the
functional currency.
LATAM’s Affiliates are also exposed to exchange
rate risk, whose impact affects the Company's
Consolidated Result.
The greatest exposure to exchange rate risk for LATAM
comes from the concentration of businesses in Brazil,
as they are mainly denominated in Brazilian Reals
(R$), and it is managed actively by the Company.
The Company minimizes exchange risk exposure by
contracting derivative instruments or through natural
hedges or the execution of internal transactions.
At December 31, 2024, the Company recognized a
ThUS$9,953 gain from FX hedging derivatives net
of premiums, reflected in the FX spread. At the end
of December 2023, the Company recognized losses
of ThUS$10,156 for FX hedging derivatives net of
premiums reflected in the FX spread.
At December 31, 2024, the Company holds
ThUS$165,000 in outstanding FX derivatives recorded
as hedges. At December 31, 2023, the Company
held ThUS$404,000 in outstanding FX derivatives
recorded as hedges.
At December 31, 2024, the market value of FX
hedging positions totaled ThUS$3,142. At December
31, 2023, the market value of FX hedging positions
totaled ThUS$(1,544).
iii. Interest rate risk
The Company is exposed to variations in interest
rates on the markets, affecting the future cash
flows of its current and future financial assets and
liabilities.
The Company is mainly exposed to the Secured
Overnight Financing Rate (“SOFR”) and other less
relevant interest rates, such as Brazilian Interbank
Deposit Certificates (“CDI”, for its Portuguese
acronym).
At December 31, 2024, 76% (50% by December 31,
2022) of debt is fixed against interest rate fluctuations.
During the financial year ended December 31, 2024,
the Company did not recognize losses from premiums
paid and other concepts. At December 31, 2023,
the Company recognized losses of ThUS$(1,810)
from premiums paid and other items. At December
31, 2024, the value of the Company’s interest rate
derivative positions corresponding to operating leases
to fix the lease of future aircraft arrivals amounted
to ThUS$4,676, while at the end of December 2023,
the Company held no current interest rate derivative
positions.
At December 31, 2024, the Company recognized an
increase in the right-of-use asset from the maturity
of derivatives related to aircraft leases for US$82,000.
At December 31, 2024, the Company recognized a
lower expense from depreciation of the right-of-use
asset of ThUS$1,919.
13 / FINANCIAL STATEMENTS
ECONOMIC ENVIRONMENT
The updated estimates for 2024 and future years
are based on conditions similar to those presented
in the October forecasts. At that time, it was said
that the cyclical imbalances are expected to be
gradually absorbed, with economic activity in the
major economies becoming more aligned with their
potential. The updated forecasts reflect recent market
movements and the effect of increased uncertainty
surrounding trade policies. This is expected to be
temporary and its effects to materialize within one
year. Energy commodity prices are also expected to
decrease in 2025, more than the previous estimate.
This reflects a fall in oil prices that is partly driven
by weak demand from China and large supply from
countries outside OPEC+ (Organization of Petroleum
Exporting Countries and other non-member countries,
including Russia). This drop in prices is offset by an
increase in gas prices, related to lower than expected
temperatures in certain regions and supply disruptions.
Added to this are the conflicts in the Middle East.
In its latest forecast in January, the International
Monetary Fund (IMF) estimates global growth at
3.2% in 2024 and 3.3% in 2025—an upward revision
of 0.1 percentage points for the latter from the
October forecast. For 2026, growth is expected to
reach 3.3%. As for inflation, it is expected to reach
5.7% in 2024, falling to 4.2% the following year and
further decreasing to 3.5% in 2026. Both figures,
for 2025 and 2026, were revised downward by 0.1
percentage points.
The IMF estimates that developed economies will
grow by 1.7% in 2024, 1.9% in 2025 and 1.8% in 2026.
The forecast for 2025 was revised upward from the
October figure. On the U.S. front, growth for 2025
was revised upward by 0.5 percentage points to 2.7%,
before declining to 2.1% in 2026. As for the Euro
zone, the IMF anticipates modest growth of 0.8%
for 2024, while for 2025 growth is expected to be
1.0% and 1.4% in 2026. The 2025 figure includes a
downward revision of 0.2 percentage points from the
October estimate, partly explained by the geopolitical
tensions that continue to impact the region.
As for emerging economies, a similar trend is expected
for the next few years, with 4.2% growth in 2024 and
2025 and 4.3% growth in 2026. This comes on the
back of a slight increase in China's economic activity,
thanks to a fiscal package announced in November,
offsetting the negative effect on investment from
increased uncertainty in trade policies and the real
estate market.
For Latin America and the Caribbean, the IMF projects
growth to rise from estimated 2.4% in 2024 to 2.5%
in 2025, and 2.7% in 2026. These figures were in line
with those in the October forecast. Brazil's economy
is expected to grow by 3.7% in 2024 and 2.2% in
both 2025 and 2026.
GRUPO
LATAM
2024
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GROUP
2024
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13 / FINANCIAL STATEMENTS
WILLIAM DE WULF
Board member
MICHAEL NERUDA
Board member
ALEXANDER D. WILCOX
Board member
IGNACIO CUETO PLAZA
Chairman of the Board
BORNAH MOGHBEL
Vice-Chairman of the Board
ENRIQUE CUETO PLAZA
Board member
FREDERICO CURADO
Board member
SWORN STATEMENT
ROBERTO ALVO MILOSAWLEWITSCH
CEO
As directors and CEO of LATAM Airlines Group S.A., we declare under oath our
responsibility for the veracity of all information contained in the LATAM 2024
Integrated Report.
LATAM
GROUP
2024
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13 / FINANCIAL STATEMENTS
COMPANY STRUCTURE
NCG 519: 6.5.1.X AFFILIATES AND ASSOCIATES
MINORITY
LATAM
GROUP
2024
13 / FINANCIAL STATEMENTS
CREDITS AND CORPORATE INFORMATION
Credits
Coordination
LATAM Group - Investor Relations - Sustainability
- External Communications
Copywriting and Design
SustainaLab
Copywriting: Isidora Barberis Ayala
Editorial supervision and indicators: SustainaLab
Graphic project: Panal.cl
Diagramming: Panal.cl
Translation: Nuriyah Costa-Laurent
Photography
LATAM Group Archive
Corporate information
Headquarters
5711 Presidente Riesco Ave., 19th floor, Las Condes
Región Metropolitana – Chile
Phone: (56) (2) 2565 3844
Stock Market Tickers
LTM CI – Santiago Stock Exchange
LTM AY – New York Stock Exchange
Investor Relations
Investor Relations | LATAM Airlines Group S.A.
5711 Presidente Riesco Ave., 19th floor, Las Condes
Región Metropolitana – Chile
Phone: (56) (2) 2565 3844
E-mail: InvestorRelations@latam.com
Shareholder Service
Shareholder Service
Depósito Central de Valores
1730 Los Conquistadores Ave., 24th floor, Providencia
Región Metropolitana – Chile
Phone: (56) (2) 2393 9003
E-mail: atencionaccionistas@dcv.cl
ADR Depository Bank
JPMorgan Chase Bank, N.A. P.O. Box 64504, St. Paul, MN, 55164-0504
Main phone: +1 (800) 990-1135
Phone: Outside the US (651) 453-2128
Phone: Global Invest Direct (800) 428-4237
ADR Custodian Bank
Banco Santander Chile Bandera 140, Santiago
Región Metropolitana – Chile
Custody Department Phone: (56) (2) 2320 3320
Independent Auditors
PricewaterhouseCoopers Consultores Auditores y Compañía Limitada
Andrés Bello 2711 Ave., 5th floor, Providencia
Región Metropolitana – Chile
Phone: (56) (2) 2940 0000
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LATAM GROUP - INVESTOR RELATIONS
LATAM GROUP - SUSTAINABILITY LATAM
GROUP - EXTERNAL COMMUNICATION
LATAM
GROUP
2024
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13 / FINANCIAL STATEMENTS
WWW.LATAMAIRLINES.COM