Brazil's biggest airline TAM Linhas Aereas said its first-quarter net profit tumbled 96 percent because of a surge in jet fuel costs and marketing expenses.
Net income fell to BRR2.6 million reais (USD$1.57 million) from BRR59.2 million in the same period in 2007, TAM said in a securities filing. Sales jumped 23.2 percent to BRR2.26 billion.
TAM said operating expenses rose 28.5 percent to BRR2.24 billion in the first quarter, led by a 48.1 percent jump in aviation fuel costs to BRR844.8 million.
Marketing and selling expenses rose 29.1 percent to BRR241.7 million, while personnel costs climbed 50.4 percent to BRR402.7 million as the airline hired more people and raised wages, also affecting the bottom line.
TAM flew 7.55 million people in the first quarter, compared with 6.66 million in the same period of 2007.
The number of passengers on domestic flights rose 9.2 percent to 6.38 million, while passengers on international flights grew 42.5 percent to 1.16 million.
The company said its share of Brazil's domestic market grew to 50 percent from 48.4 percent a year earlier.
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