LATAM Airlines : 4Q 2018 LATAM Airlines Results Presentation

Successfully delivered on a transformational plan to enhance LATAM's

performance

 ASK (billion)

2015

2016

2017 2018

134

135

136 143

+6.7 %

 Operational Fleet (units)

327

329

307

310 1

-5.2 %

 EBIT Margin (%)

6,0%

7,0%

6,8%

5,1%

+170 bps

 Net Income (US$ in million)

 Free Cash Flow (US$ in million)

1.379

1.159

549

+400 mm

+1,183 mm

-24

 Gross Debt (US$ in billion)

vs.15

Adjusted Net Leverage (x)

1 Excludes 2 short-term leased aircrafts, as of December 2018.

Full Year 2018 Highlights

Overcame relevant challenges including:

• - Higher fuel cost (~US$664 million)

• - Currencies devaluation

  • - Truckers strike in Brazil

• - Cabin crew strike in Chile

  • - Engine maintenance (Rolls-Royce engines issues)

• Delivered strong 2018 results:

• - Operating Revenue of US$10.4bn

  • - Free Cash Flow of US$1,159 million

• - EBITDAR of US$2.2bn

• - Net income of US$182mm

Cost cutting initiatives supported 2018 resilient margin profile

$2.2bn reduction in fleet commitments between 2018 and 2021

Other Relevant Events in the Year

Announced intention to acquire the minority stake in Multiplus. Tender offer between March 1st - April 1st, 2019

Chile's Competition Court (TDLC), last pending authority in Latin America1, approved the JBAs between LATAM Airlines Group and American Airlines and IAG2

Source: Public Company filings.

1 Decision is being appealed before the Chilean Supreme Court. 2 British Airways and Iberia.

Q4 2018 Financial Summary

Total Operating Revenues

Passenger

Cargo Others

2,788 2,327 312 149

2,768 2,275 337 156

0.8% 2.3% -7.4% -4.5%

10,368 8,709 1,186 473

10,164 2.0% 8,494 2.5% 1,119 6.0% 550 -14.0%

Total Operating Costs

Fuel

Ex-fuel

-2,493 832 1,661

-2,498 651 1,847

-0.2% 27.9% -10.1%

-9,663 2,983 5,019

-9,449 2.3% 2,319 28.6% 5,284 -6.3%

Operating Income

Operating Margin

295 10.6%

270 9.8%

9.2% 0.8 p.p.

705 6.8%

715 -1.3%

7.0%

-0.2 p.p.

Net Income (Loss)

Foreign Exchange Gains/Losses

149 -12

67 -67

121.3%

NM

182 -158

155 -19

+17.1% 678%

EBITDAR

EBITDAR Margin

675 24.2%

660 23.9%

2.2% 0.3 p.p.

2,225 21.5%

2,296 22.6%

-3.1% -1.1 p.p.

Fourth Quarter 2018 Operating Statistics

International

(Long Haul & Regional)

Domestic BrazilSSC Domestic

+7.4%

+4.4%

+7.1%

+3.5%

+3.0%

+7.0%

83.1%

(-3.1 p.p.)

83.6%

(-1.1 p.p.)

82.3%

(-0.1 p.p.)

5.8

(-9.1%)

(-6.2%)

7.0

(-8.2%)

Passenger

+6.5% +1.1%

+4.0% -0.9%

83.0%

(-2.0 p.p.)

Cargo

57.3%

(-1.1 p.p.)

6.3

(-4.0%)

18.8

(-8.4%)

• 1 RASK by business unit includes ticket revenue, breakage, frequent flyer program contribution and ancillary revenues. Total passenger RASK considers reported passenger revenues and includes IAS21 and IAS29

• 2 Excluding proportional margin contribution from Multiplus

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