Chile airline LAN to invest $2.83 billion in fleet expansion


SANTIAGO – LAN, Chile’s dominant airline, said on Thursday it would invest $2.83 billion between 2010 and 2013 as it expands its fleet, and said it was optimistic about the outlook for this year.

Chairman Jorge Awad told a shareholder meeting the company would invest $500 million in 2010 and $1 billion in 2011 to purchase both short- and long-haul aircraft.

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The investment compares with $1.4 billion the company announced last April it had earmarked for 2009-2011.

LAN said on Tuesday its net profit rose 36 percent to $88.3 million during the first quarter, citing a strong recovery in its passenger and cargo businesses.

LAN said its results were also boosted by comparison with the year ago period because of a $57.9 million hedging loss in the first quarter of 2009. LAN lost $2.63 million on hedging in the first quarter of 2010.

However, LAN said that its results had been held back because of the devastating earthquake on Feb. 27, which canceled flights out of Santiago international airport and damaged installations.

The airline said last month it had reached a deal with Boeing (BA.N) to bring forward delivery of 10 new Dreamliner planes to 2011 from 2014.

LAN has affiliates in Ecuador, Peru and Argentina. It accounts for more than half of Chile’s international passenger traffic and nearly three-quarters of its domestic traffic.