Thursday, 25 April 2019

Norwegian reports increased revenues, reduced costs and big losses for the first quarter

One of the World's most popular low-cost airlines, Norwegian issued its first-quarter results this week which showed that whilst the firm reduced its costs and increased its revenue it still racked up a net loss of  NOK 1,489 million!

The airline said its total revenue was up by 14%  to NOK 8 billion, which it claims was primarily driven by intercontinental growth and increased traffic in the Nordics.  More than 8 million passengers flew with the airline during the quarter, up around 9% and it achieved load factors averaging 81%.

Perhaps the most important issue for passengers after safety is an airlines punctuality and Norwegian improved on that issue, indeed its punctuality increased significantly from 73 to 81.3%, while its 98.7% of flights operated.

Norwegian’s key priority is returning to profitability and it is doing that through a series of measures, including an extensive cost-reduction program, reorganised route portfolio as well as selling off some new aircraft. 

The airline has also been dramatically affected by the grounding of the Boeing 737 Max aircraft, it has had to take 18 of the type out of service, which has resulted in the airline wet leasing in other aircraft, amended schedules, upgrading routes to 787 types of craft. “Our dedicated colleagues at Norwegian have been working day and night to find solutions for our customers. They will continue to do their utmost to ensure that all flights continue to depart as planned, regardless of how long the MAX stays out of service,” said CEO of Norwegian, Bjørn Kjos. 

“We have had some productive meetings with Boeing where we have discussed how we can manoeuvre through the difficulties the MAX situation is causing Norwegian,” Kjos added. 

“I’m pleased with the positive developments this quarter, despite the 737 MAX issues. We have taken a series of initiatives to improve profitability by reducing costs and increasing revenue. We are optimising our base structure and route network to streamline the operation as well as divesting aircraft, postponing aircraft deliveries and not least implementing our internal cost reduction program, which will boost our financials. I am also pleased that booking figures and overall demand for the coming months look promising,” said Kjos.

(Images Norwegian)


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