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SAO PAULO, Aug 1 (Reuters) - Brazil's largest airline, Gol Linhas Aereas Inteligentes, on Thursday announced it would buy back some of its shares, after posting a narrower loss in the second quarter, helped by higher revenues that resulted from shrinking competition.
The airline reported a loss of 194.6 million reais ($51.04 million), compared with a loss of 1.9 billion in the same period a year earlier. Gol said it will buy up to 3 million preferred shares traded in the Brazilian market in the next 12 months. The shares were valued at roughly 120 million reais at close of the market on Wednesday.
Gol has struggled for years to turn consistent profits despite regularly increasing its revenues, and has been recently affected by the recurrent woes of Brazil's real currency. While most of Gol's revenues are in reais, significant costs such as fuel and aircraft rent are paid for in U.S. dollars.
The grounding of Boeing Co's 737 MAX planes has also weighed on Gol, which had initially hoped that 2019 would be a turnaround year helped by the plane's high fuel efficiency. The carrier has seven MAX planes and has placed over 120 orders, which would make it one of the world's largest operators of the aircraft.
The company said its revenue for the quarter was its highest ever, reaching 3.1 billion reais, a 33% increase from a year earlier.
Gol's results have been positively affected by lower competition in Brazil's domestic air travel market, after rival Avianca Brasil ceased operations earlier this year. Avianca Brasil filed for bankruptcy after its plane lessors moved to repossess its fleet when the carrier fell behind on payments because of the depreciation of the real.
$1 = 3.8130 reais Reporting by Marcelo Rochabrun; Editing by Bernadette Baum