Chile's Lan airline Q1 net up 10pct

Chile's dominant airlineLansaid on Tuesday its first quarter profit rose 10 per cent from a year earlier to $97.235 million, well short of market expectations as higher fuel costs hurt margins. Lan said operational costs rose 35.8 per cent to $1.21 billion in the first quarter compared to a year earlier on higher fuel consumption and prices.

The airline was expected to post a 29 per cent jump in its first-quarter net profit to $113.5m on stronger air traffic despite rising fuel prices, a Reuters poll of eight analysts showed on Monday. Lan, which has agreed to merge with Brazil's Tam to form the region's top carrier, said previously that passenger traffic climbed 21 per cent in the first quarter after the company canceled dozens of flights in the same period last year when a massive earthquake damaged air terminals in Santiago and momentarily halted landings.