Good day and thank you for standing by. Welcome to First Quarter LATAM Airlines Group Earnings Conference Call. [Operator Instructions] Please be advised today’s conference is being recorded. Before I turn the call over to management, I’d like to remind you that certain statements in this presentation and during the Q&A may relate to future events and expectations and as such, constitute forward-looking statements. Any matters discussed today that are not historical facts, particularly comments regarding the company’s future plans, objectives and expected performance or guidance are forward-looking statements. These statements are based on a range of assumptions that LATAM believes are reasonable, but are subject to uncertainties and risks that are discussed in detail in the recently published 20-F earnings release, financial statements and related CMF and SEC filings. The company’s actual results may differ significantly from those projected or suggested in any forward-looking statements due to a variety of factors, which are discussed in detail in our SEC filings. And if there are any members of the press on the call, please note that for the media, this is a listen-only call. I would now like to hand the conference over to your speaker today, Ramiro Alfonsin, CFO of LATAM Airlines Group. Please go ahead.

Thank you, Gigi. Hello, everyone, and good morning. Welcome to our first quarter 2024 conference call, and thank you for joining us today. My name is Ramiro Alfonsin, and I’m the CFO of LATAM Airlines Group. Here with me today is Mr. Roberto Alvo, CEO of LATAM Airlines Group; Andres del Valle, VP of Corporate Finance; and Tori Creighton, Head of Investor Relations and we will present our highlights and results for the first quarter of 2024. I’d like to pass the presentation to Roberto to set the stage for our first quarter results.

Thank you, Ramiro, and good morning, everyone. Yesterday, we made our first quarter results public, which were strong, reflecting not only our unique network footprint, the strength of our [indiscernible] flyer program, our solid financial foothold and good operational execution, but also with growing clarity, a strong customer preference for LATAM. Before continuing, I want to take a moment to express my gratitude to the more than 35,000 people in our group. They are LATAM’s most valuable asset, and it is they who make really things happen. Their passion, dedication and commitment are what drives and will drive LATAM’s success. Every day, we strive to make traveling a more distinctive experience by not only offering our customers a unique value proposition, but also ensuring that they are properly served at every touch point of their journey in a carrying and dependable way. Certainly, this is a demanding task as the group transports over 220,000 passengers per day, 100,000 bags and 2,500 tonnes of cargo day in, day out but we have set ourselves ambitious goals to make sure we succeed in making customers feel that we met all the traveling needs and we enable their destination dreams to become true as we take to travel every day. During this quarter, we have seen solid operational performance. The group transported a record-breaking number of 20.2 million passengers, achieving a robust load factor of 84.4%. These numbers were accompanied by a complete recovery of LATAM’s group capacity as compared to 2019. The affiliates of LATAM Group continued to ramp first in 3 of the 5 domestic markets, notably LATAM Brazil reached a record domestic market share of 41% in March, the highest on the last 11 years. However, it is important to acknowledge that the industry is still facing important challenges, significant…

Thank you, Roberto. Please join me on Slide 4. The group’s results have remained strong, understanding that this successful outcome stem from doing things right in the holistic business sense. This first quarter, the group continues to consolidate the trend of strong performance through the P&L, cash flow and capital structure. In the top line, revenues amounted to $3.3 billion, representing an increase of 18%. This growth is primarily in the passenger business, which saw a 21% increase compared to the same period of ‘23. Total adjusted operating costs during the quarter increased by 14% compared to the same period in 2023. This increase is mainly explained by a 17% increase in capacity year-over-year. Importantly, as Roberto mentioned, we have been able to contain our unit cost in line with what was reported for the full year of 2023 with the passenger CASK ex-fuel of $0.43. In terms of adjusted EBIT, this figure grew 57% year-over-year. It amounted to $463 million, contributing to a net income of $268 million for the company. Moving forward, we remain committed to delivering exceptional value to our customers. LATAM Group will continue to focus on providing a distinctive travel experience, ensuring reliability, safety and customer satisfaction in every step of the journey, thereby looking to attract more customers and foster loyalty through the continued strategic investments. In line with this commitment, LATAM Group has renovated the premium cabins of our now body aircraft and is advancing on the onboard connectivity of the fleet. We have achieved 100% implementation of onboard Wi-Fi in Brazil, 60% in Colombia, 40% in Peru and 35% in Chile. Additionally, LATAM Group has started the construction of a new VIP launch in the Lima Airport. These strategic investments will further enhance the channel experience of our passengers both onboard and…

Thank you. [Operator Instructions] Our first question comes from the line of Fernando Grecia from BTG.

Hi, thank you for taking my question. Two from our side. The first, could you comment a little bit further on how you’re seeing the yield environment going forward? Maybe if you could explore domestic and international routes, it could be great. And second, I just wanted to understand if the guidance that you provided kind of incorporate any compensation from [indiscernible] or if this is an outside? Thank you.

Hi, Fernando. This is Roberto. How are you? So as explained before, when you look at second quarter, although it’s a seasonally weakest quarter of the year, demand looks healthy and yields look in-line with what is expected given the seasonality further down the line, July still early, but looks at a healthy high season moment that we have because of holidays. And when we think about demand throughout the region in general, we see, I would say, stability. You asked, particularly on international and international is very healthy in general, to the U.S., Australia and Europe are in relatively good shape across the world. With respect to compensation, I understand Boeing or Pratt. So we have no 787 deliveries this year from Boeing, only next year. So there’s nothing there. And in the case of Pratt, we do have some aircraft on ground, and we are currently under discussions with them regarding what that means. There is no compensation expected in the number that we have provided.

Okay, thank you very much.

Thank you. [Operator Instructions] Our next question comes from the line of Victor Mizusaki from Bradesco BBI.

Hi. Congrats for the results. We have two questions here. The first one is a follow-up on the fleet plan. I mean when we take a look on your updated fleet plan, it looks like that LATAM is trying to extend some of the aircraft leasing contracts. So, my question here is if there is any kind of a cost pressure from these extensions. And the other point, when you take a look on the deliveries, if not wrong, early last year, the company had a plan with Airbus to reserve like 8 or 11 planes and then it was reduced to 3 aircraft this year and 11 next year. So, my second question is if there is any risk that may be Airbus deliver these planes this year? Thank you.

Hi Victor. This is Ramiro. Regarding the plan, I would say, first, on your second point, we feel confident on the list that we need to grow in 2024 and 2025. And we feel confident on the deliveries that we have – we are expecting from Airbus. We have no news of further delays other than the ones included in the figures of the table of the earnings call. So, extremely confident on those deliveries, always subject to the current market conditions, but we are confident that the lift that we need in order to grow what we are expecting is going to be there. Regarding the extensions, we have extended and we have been vocal on the last quarter, if you remember, that we were extending certain 320 to 319s. We are not seeing particular pressure or pricing in our current negotiations. Although overall in the industry, we are seeing an increase in the cost of aircraft generally, but not only extensions that we have signed.

Great. Thank you.

Thank you. [Operator Instructions] Our next question comes from the line of Stephen Trent from Citi.

Good morning everybody and thanks very much for taking my questions. Two for me, the first is regarding the deal you reached with Fortress Aviation, I believe on 60 engines and could you sort of give me a sense as to why you went with Fortress as opposed to maybe doing something similar with Delta Airlines tech ops? Thank you.

Hi Stephen, this is Ramiro. Yes. The Fortress agreement is in line with what we are looking in terms of having additional flexibility on our aircraft as we decided to extend certain of these aircraft. We carried out some sale and leaseback on the aircraft and sell, some we could eventually, if we want to reduce the fleet in case we need it or expand it a little more, so it gives us a lot of flexibility. And in addition to that, it allows us to benefit from a certain pool of engines. We decided to do it with Fortress because there were a good partner in terms of conditions in terms. Again, looking not only at pricing, but also the flexibility that we need in this current market environment, and they had the pool of engines that we were targeting. So, that’s why we selected those. We have other partners for other engine agreements that we have, but that’s why we selected Fortress in this particular case.

Okay. That’s very helpful. Appreciate the color.

Thank you.

And just quickly, just a second question. You mentioned adding more premium into your international intra-Latin America. I heard you mention the VIP lounge in Lima and the onboard WiFi and what have you. How far along are we in that process? Do you expect another three or four quarters of making these adjustments, or are you close to the finish line? Thank you.

Hi Stephen, this is Roberto. So, basically, we are installing Wi-Fi on our narrow-bodies. We are not installing at this point in time WiFi on our wide-bodies. As explained in the presentation, around 70% of the fleet already has WiFi, we expect to conclude the incorporation of WiFi in our narrow-body fleet this year, okay. And all of our LATAM pass members will have free messaging on WiFi and our Lima pass members will have free browsing and if you sign in into LATAM pass, were on your plane, then you will get free messaging as well. So, the bottle [ph] also intends to increase and improve the number of participants that we have in our LATAM pass program. We have not made a decision yet with respect to WiFi on low haul aircraft. And as you know, in the past, because of where we are in the world, Southern Hemisphere, there were significant blackouts in terms of satellite coverage, which is changing now with the new technologies. But for the time being, it’s on the…

Okay. Thanks for that Roberto. Thank you.

[Operator Instructions] At this time, I am showing no further questions. I would now like to turn the conference back over to Ramiro Alfonsin for closing remarks. Pardon me. We actually have another question. One moment. Our next question comes from the line of Guilherme Mendes from JPMorgan.

Hello Roberto, Ramiro, good morning. Thanks for taking my question. I have two questions. The first one is a follow-up on the guidance assumption. We saw a revision on the capacity on the three regions, but I was wondering if you could provide more details on which route or region specifically you are seeing an upside thinking about the international front and also the Spanish-speaking countries. And the second question is regarding the ADR listing. I understand there is a couple of requirements needed for the company to take the decision to go ahead with the process or not? Just wondering if you can provide more details on which kind of requirements are you talking about, and if the base case is still to have the decision by September or October this year? Thank you.

So, I will take the first one and then Ramiro. So, on international – Guilherme, good morning, how are you? So, basically, what we are doing at this point in time is focusing on we as – we are just bringing back our particular Santiago Lima and Guarulhos hubs to pre-pandemic levels. So, we are increasing operations today on those flights from Guarulhos where we didn’t have dates. And we are launching new routes or more or less re-launching route that we used to fly before the pandemic success Santiago-Sydney direct, and we started Santiago-Maryland as well, increasing capacity to [indiscernible] direct as well. So, it’s basically a reinforcement and complementation of our low haul wide-body use out of our main hub Santiago, Lima and Guarulhos.

Yes. Hi Guilherme, how are you? This is Ramiro. Regarding the ADR listing, all the work streams have started. There are many counterparts on this process. It is progressing well. As you correctly say, the Board will eventually approve the – at the time of the listing. So, there is no exact date at this moment on when this is going to happen, and we will keep the market informed as the Board makes a decision so that everyone has sufficient information.

Super clear. Thank you. Have a great day.

Thank you. At this time, I would now like to turn the conference back over to Ramiro Alfonsin for closing remarks.

Thank you, Gigi, and thank you all again for joining us today. As always, our Investor Relations team is around for any further questions. Have a great weekend.

This concludes today’s conference call. Thank you for participating. You may now disconnect.