Tuesday, 16 February 2021

Icelandair Group records a net loss of $376.2 million in 2020.... sells off the last of its hotel business and looks to the future...

Massive loss for Icelandair during the last quater and the whole of last year.....  


The troubled Icelandair Group has reached an agreement with Berjaya regarding sale of its remaining 25% share in Icelandair Hotels, the company has confirmed this week.

The firm will take in $3.4 million for the sale, which translate to just a book value of $13,000 and soon the Icelandair Hotels name will be dropped as Berjaya will be rebrand the hotels.

Bogi Nils Bogason, President & CEO of Icelandair Group:  "The sale of the remaining shares in Icelandair Hotels is in line with the Company’s strategy of focusing on our core business, aviation and related services, going forward. I want to thank all the employees of Icelandair Hotels for their cooperation and their contribution in building up numerous high-quality hotels in Iceland, leading to a unique experience for our guests. I am confident that Iceland will continue to be an attractive tourist destination following the pandemic and that Icelandair Hotels will continue to play an important role in the further development of the Icelandic tourism market in the coming years. I want to thank Berjaya for a good cooperation during the past year and wish them and Icelandair Hotels all the best for the future."


 Looking back and ahead for Icelandair.....

 Icelandair was badly effected by the continuing COVID-19  pandemic, its 2020 performance, starkly demonstrated but the news that the carrier carried more passengers in January and February that it did in the rest of the year combined.

The carrier reported a net loss of $83.3 million with passenger numbers dropping by 97% and capacity down by 95% for the last quarter and for the full year of 2020,  those numbers were much worse.  The full year net loss was $376.2, revenues down 71%.


  • Operations in Q4 2020 heavily impacted by COVID-19 and related travel restrictions with capacity down by 95%
  • Total revenue in Q4 2020 USD 60.2 million decreasing by 81% from last year
  • Cargo revenue increased by 48% year-on-year in fourth quarter
  • EBIT negative of USD 60.2 million in Q4 2020 compared to negative EBIT of USD 36.7 million in Q4 2019
  • Icelandair’s capacity down by 81% in 2020 compared to 2019 and the number of passengers down by 83%
  • Net loss for the full year 2020 USD 376.2 million compared to a net loss of USD 57.8 million in 2019
  • Equity USD 232.8 million at year-end and equity ratio down from 29% to 25%, adjusted for temporary effects of warrants
  • Total liquidity USD 331.4 million at year-end 2020, thereof cash and marketable securities USD 159.4 million
  • Demand for Q1 2021 still weak due to the status of the pandemic in key markets
  • Modest ramp-up assumed in Q2 2021
  • Boeing 737 MAX recertified as safe to fly and will be reintroduced into the network in the spring


Bogi Nils Bogason,  "The results of the fourth quarter continued to be impacted by COVID-19 with minimum operations throughout the period. By focusing on maintaining the flexibility of our route network we were able to meet increased demand in December for travel to and from Iceland over the holiday period.

It is fair to say that 2020 was the most challenging year in aviation history, with the global pandemic causing almost a complete halt to air travel. We have taken our role as the lead Icelandic carrier seriously during this time and ensured to keep vital routes open to and from Iceland, both for passengers and cargo. During the year we took extensive measures to scale down our business and strengthened the long-term competitiveness of Icelandair Group by completing a financial restructuring which included a successful share offering. We were honoured by the strong participation in the offering, where we raised USD 167 million in new share capital. Around seven thousand new shareholders joined our strong and broad shareholder base, which now totals over 13 thousand shareholders.


During this time, we have focused on preserving the necessary infrastructure to be able to react quickly to changes in our markets. This proved successful during the summer when border restrictions were eased temporarily, and we were able to ramp up quickly to meet increased demand. Furthermore, we managed to create important value through our cargo and leasing operations by seizing various new opportunities during the year.

The responsibility towards our customers and employees was at the top of our agenda during 2020, securing health and safety across our operations and ensuring clear communication during fast-changing conditions. We have put all efforts in finding solutions for our customers and getting those that have needed to travel to their destinations. In addition, we completed the processing of the vast majority of refunds, travel credits and other changes to bookings during the year.

We are still facing considerable uncertainty as we continue to be dependent on the status of the pandemic, vaccine distribution and border closures in our markets for air travel to resume. However, we are optimistic that we will be able to start a modest ramp-up of our network in the second quarter of this year. It is great news that the 737 MAX has now been recertified as safe to fly, with a number of airlines already having taken them into operation. We plan to return the aircraft to service in the spring following extensive updates and pilot training where safety is our priority. The aircraft is both cost-effective and more environmentally friendly, giving us additional operational flexibility during the ramp-up as well as supporting the future development of our route network.

I am confident that there will be plenty of opportunities for Iceland and thereby the Icelandair route network post COVID. Iceland will continue to be an attractive tourist destination and, due to changes in the competitive landscape, we also see additional opportunities for our transatlantic service, where we offer convenient connections between Europe and North America through Iceland.

I would like to use the opportunity and thank our outstanding team of employees for their dedication and resilience during this unprecedented year. I would also like to thank our customers and shareholders for their continued support. I believe that with a clear vision for the future, focus on the right priorities and a team effort, we will come out of this crisis stronger than before.”

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