Press Releases

LAN AIRLINES S.A. ANNOUNCES ACCOUNTING POLICIES AND EXPECTED IMPACT RELATED TO THE ADOPTION OF IFRS

Santiago, Chile, September 30, 2008

LAN Airlines S.A. and its related companies, ("LAN" or "the Company") (NYSE: LFL / IPSA: LAN), today informed the Chilean Securities and Exchange Commission (Superintendencia de Valores y Seguros ("SVS") of the main accounting policies and the expected impact on shareholders’ equity related with the implementation of International Financial Reporting Standards (IFRS). In accordance with SVS regulations, all public companies in Chile with significant
market presence must adopt IFRS as of January 1, 2009.

The adoption of IFRS seeks to align Chilean accounting principles with international standards. It is important to note that the adoption of IFRS represents an accounting change only, and does not affect the underlying operation of the business or its cash flows.

LAN’s preliminary estimate is that the impact of the adoption of IFRS will result in a 4.3% decline in the Company’s shareholders’ equity as of December 31, 2007. This represents a US$42 million reduction and as a result adjusted shareholders’ equity will amount to US$946 million.

The Company estimates that the adoption of IFRS will not have a significant material effect on its financial results in the future.

 

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