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COSTS AND EXPENSES BY NATURE

12 Months Ended

Dec. 31, 2021

Disclosure of expenses by nature [text block] [Abstract]

NOTE 27 - COSTS AND EXPENSES BY NATURE

(a) Costs and operating expenses

The main operating costs and administrative expenses are detailed below:

	For the year ended December 31,
	2021		2020		2019
	ThUS$		ThUS$		ThUS$

Aircraft fuel		1,487,776		1,045,343		2,929,008
Other rentals and landing fees (*)		755,188		720,005		1,275,859
Aircraft rentals (**)		120,630		-		-
Aircraft maintenance		533,738		472,382		444,611
Commissions		89,208		91,910		221,884
Passenger services		77,363		97,688		261,330
Other operating expenses		959,427		1,221,183		1,291,895
Total		4,023,330		3,648,511		6,424,587

(*)	Lease expenses are included within this amount (See Note 2.21)

(**)

During 2021, the Company amended its Aircraft Lease Contracts which included lease payment based on Power by the Hour (PBH) at the beginning of the contract and then switches to fixed-rent payments. A right of use asset and a lease liability was recognized as result of those amendments at the date of modification of the contract, even if they initially have a variable payment period. As a result of the application of the lease accounting policy, the right of use assets continues to be amortized on a straight-line basis over the term of the lease from the contract modification date. The expenses for the year include both: the lease expense for variable payments (Aircraft Rentals) as well as the expenses resulting from the amortization of the right of use assets from the beginning of the contract (included in the Depreciation line b) below) and interest from the lease liability (included in Lease Liabilities c) below).

	For the year ended December 31,
	2021		2020			2019
	ThUS$		ThUS$			ThUS$

Payments for leases of low-value assets		19,793		21,178			31,982
Rent concessions recognized directly in profit or loss		-		(110	)		-
Total		19,793		21,068			31,982

(b)	Depreciation and amortization

Depreciation and amortization are detailed below:

	For the year ended December 31,
	2021		2020		2019
	ThUS$		ThUS$		ThUS$

Depreciation (*)		1,114,232		1,219,586		1,389,465
Amortization		51,162		169,800		80,511
Total		1,165,394		1,389,386		1,469,976

(*)

Included within this amount is the depreciation of the Properties, plants and equipment (See Note 17 (a)) and the maintenance of the aircraft recognized as assets by right of use. The maintenance cost amount included in the depreciation line for the year ended December 31, 2021 is ThUS $ 351,701, ThUS $ 276,908 for year 2020 and ThUS $ 445,680 for the same year 2019.

(c)	Financial costs

The detail of financial costs is as follows:

	For the year ended December 31,
	2021		2020		2019
	ThUS$		ThUS$		ThUS$

Bank loan interest		580,193		314,468		325,650
Financial leases		46,679		45,245		61,980
Lease liabilities		121,147		170,918		181,814
Other financial instruments		57,525		56,348		20,490
Total		805,544		586,979		589,934

Costs and expenses by nature presented in this Note plus the Employee expenses disclosed in Note 23, are equivalent to the sum of cost of sales, distribution costs, administrative expenses, other expenses and financing costs presented in the consolidated statement of income by function.

(d)

Restructuring activities expenses

The Restructuring activities expenses are detailed below:

	For the year ended
	December 31,
	2021		2020		2019
	ThUS$		ThUS$		ThUS$

Fair value adjustment of fleet available for sale		73,595		331,522		-
Rejection of aircraft lease contract		1,564,973		269,467		-
Rejection of IT contracts		26,368		-		-
Employee restructuring plan (*)		46,938		290,831		-
Legal advice		91,870		76,541		-
Renegotiation of fleet contracts		516,559		-		-
Others		16,879		21,648		-
Total		2,337,182		990,009		-

(*)	See note 2.1, letter c.

(e) Other (gains) losses

Other (gains) losses are detailed below:

	For the year ended
	December 31,
	2021			2020			2019
	ThUS$			ThUS$			ThUS$

Fuel hedging		-			82,487			-
Slot Write Off		-			36,896			-
Provision for onerous contract related to purchase commitment		(44,000	)		44,000			-
Goodwill Impairment		-			1,728,975			-
Other		13,326			(17,569	)		(11,525	)
Total		(30,674	)		1,874,789			(11,525	)