LanChile Monthly Traffic Report for December 2003.

Business Editors/Travel Writers

SANTIAGO, Chile--(BUSINESS WIRE)--Jan. 9, 2004

LanChile S.A. ("LanChile" or "the Company") (NYSE: LFL), Chile's largest domestic and international airline, reported its preliminary monthly and accumulated traffic statistics and punctuality indicators for December 2003.

System passenger traffic for December increased 16.2%, while capacity increased 8.4%. As a result, the Company's load factor increased 4.8 points to 71.4%. For the full year, traffic grew 13.7% as capacity increased 7.4%, leading to a 3.8-point improvement in load-factor.

International passenger traffic for December increased 22.1% while capacity grew 14.5%. Accordingly, the international passenger load factor for the month increased 4.5 points to 72.1%. These results reflect improvements in demand in several markets, as well as market share gains and the launch of new routes. For the full year, international load factor improved 5.8 points driven by a 21.4% increase in traffic and an 11.5% increase in capacity.

Domestic passenger traffic for December decreased 3.1% as capacity declined 10.4%. These results led to a 5.2-point increase in load factor to 68.3%. While the Company continued to face increased competitive activity compared to last year, demand showed a positive evolution during December. Domestic traffic for the full year decreased 10.5% as capacity declined 5.8% and, as a consequence, load factor decreased 3.3 points.

Cargo traffic for December, as measured in RTKs, improved 11.2% while capacity increased 9.5%. Consequently, the cargo load factor increased 1.0 point to 66.3%. These results reflect improved southbound traffic, strong export traffic out of Latin America, and market share gains. For the full year, cargo traffic grew 4.2%, capacity increased 4.3%, and load factor declined 0.1 points.

In December, 87.9% of the Company's total flights left on-time, based on a fifteen-minute standard (all departures leaving within fifteen minutes of scheduled departure time are considered as "on-time"). This represented a 0.3 point increase compared to December 2002. For the full year, LanChile's punctuality rate improved 1.2 points to 88.2%.

LanChile S.A. is the largest domestic and international passenger/cargo air carrier in Chile and one of the leading airlines in Latin America. Together with its code-share arrangements and affiliated airlines, the Company serves 15 destinations in Chile, seven destinations in Peru, 18 destinations in Latin America, 25 in North America, ten destinations in Europe and four in the South Pacific. Currently, the Company operates 48 passenger aircraft and seven dedicated freighters.

LanChile is a member of oneworld (TM), the most international of the global airline alliances. It has bilateral commercial agreements with oneworld partners American Airlines, British Airways, Iberia and Qantas and also with Alaska Airlines, AeroMexico, TAM and Lufthansa Cargo. For more information visit www.lanchile.com or www.oneworldalliance.com.