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LATAM Airlines (LTM) May Traffic Hurt by Coronavirus Woes

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LATAM Airlines Group S.A. reported bland traffic numbers for May, primarily due to weak air travel demand stemming from the COVID-19 pandemic. Load factor (% of seats filled by passengers) deteriorated as traffic plunge outweighed capacity contraction.

Consolidated traffic (measured in revenue passenger kilometers or RPKs) of LATAM Airlines tanked 96.5% on a year-over-year basis. As this carrier trimmed capacity to cope with the bleak demand scenario, consolidated capacity (measured in available seat miles/ASMs) plunged 93.3%. Meanwhile, consolidated load factor dropped 39.8 percentage points to 43.8%. Passenger count too slumped 96.7%.

During the first five months of 2020, LATAM Airlines generated RPKs of 29,438 million (down 42.8% year over year) and ASMs of 36,913 million (down 39.8% year over year). Load factor declined 4.2 percentage points year over year to 79.8%. Passenger count at LATAM Airlines fell 38.9% in the January-May period.

Zacks Ranks & Key Picks

LATAM Airlines currently carries a Zacks Rank #4 (Sell).

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