LAN Airlines S.A., one of Latin America’s leading passenger and cargo airlines, announced its consolidated financial results for first quarter ended March 31, 2011. LAN makes reference to the consolidated entity, which includes passenger and cargo airlines in Latin America. All figures were prepared in accordance with International Financial Reporting Standards (IFRS) and are expressed in U.S. dollars.

LAN reported a net income of US$97.2 million for first quarter 2011, an increase of 10.1% compared to the US$88.3 million reported in first quarter 2010. This result is despite the consolidation of US$11 million losses generated in the Colombian operations of AIRES, and also reflects LAN’s successful management under the current scenario of increased fuel prices.

Operating income reached US$153.3 million in first quarter 2011, a 7.3% increase compared to US$142.9 million in first quarter 2010. Operating margin reached 11.2% compared to 13.8% in first quarter 2010. Total revenues in first quarter 2011 reached US$1,364.9 million compared to US$1,034.9 million in first quarter 2010 due to a 32.0% increase in passenger revenues and a 30.2% increase in cargo revenues. Passenger and cargo revenues accounted for 71.6% and 25.4% of total revenues, respectively, during first quarter 2011.

During the quarter, LAN has successfully implemented measures in order to mitigate the impact of higher fuel prices on its operations. For the company, higher fuel prices during the quarter, which increased 32.2% compared to first quarter 2010, generated US$100.3 million in increased fuel costs. Regarding the approval process for the transaction with TAM, on April 20, 2011, the TDLC announced that a public hearing will take place on May 26, 2011 in which the interested parties, including LAN and TAM, may provide their opinion regarding the business combination.

In line with the company’s expansion, during first quarter 2011, the company received a total of 3 Airbus A319 and 6 Airbus A320 passenger aircraft, destined for domestic and regional markets, and 1 Boeing 767-300F freighter, mainly destined for growth on northbound routes.