More good news has emerged from the Latin American airline industry, with Brazilian carrier Varig returning to profit in 1997 after six successive years in the red.
Varig's main airline operations ended the year with a net profit of Real27.8 million ($24.2 million), turning around a loss of Real64 million. Varig's sales reached Real3.5 billion, while load factors were up by two points, at 68%.
President Fernando Pinto attributes the turnaround to the two-year restructuring programme he instituted after taking over in mid-1996 with the aim of stripping out $200 million of costs. He says that last year the airline had managed to trim debt by $120 million to $2.2 billion, of which half consists of lease payments on aircraft. Varig also reveals plans to invest some $40 million in infrastructure this year.
Elsewhere, LanChile, which last year became the first Latin American carrier to be listed on Wall Street, has filed strong results for 1997, with profits up from $38 million to more than $64 million. Passenger numbers soared by 67%, helped considerably by the acquisition of short-haul operator Ladeco.
Shares have also been soaring in Cintra, the holding company which owns Aeromexico and Mexicana, helped by solid year-end results and expectations of the imminent sale of a 35% stake in AeroPeru to Delta Air Lines.
Source: Flight International
