Icelandair orders 13 Airbus A321XLR aircraft

The national airline of Iceland, Icelandair has placed a firm order for 13 Airbus A321XL aircraft as well as completed long-term lease deals with SMBC Aviation Capital Limited, for four new Airbus A321LR aircraft, scheduled to be delivered from Airbus in the fourth quarter of 2024.  

The carrier origionally announced back in April this year that it had signed a Memorandum of Understanding for the purchase of 13 Airbus A321XLR aircraft with purchase rights for additional 12 aircraft. 

With its extra long range, the A321XLR will allow Icelandair to seize new market opportunities. The aircraft will also enable the airline to reduce its operating costs, support its sustainability targets and at the same time offer its passengers the best in cabin comfort.

The A321XLR is the next evolutionary step from the A320neo which responds to market needs for even more range and payload, creating more value for the airlines. It will deliver an unprecedented Xtra Long Range of up to 4,700nm – 15% more range than the A321LR and with 30% lower fuel burn per seat compared with previous generation competitor aircraft, as well as reduced NOx emissions and noise. For passengers, the A321XLR’s new Airspace cabin will provide the best travel experience, while offering seats in all classes with the same high-comfort as on a long-haul wide-body, with the low costs of a single-aisle aircraft. By the end of May 2023, the A320neo Family had accumulated more than 8,750 orders from  136 customers worldwide.

”We are very pleased to announce that we have now finalized the purchase agreement with Airbus. The efficient A321XLR aircraft will further strengthen our business model, increase our flexibility and provide opportunities for future growth, as well as further support our sustainability efforts. The first aircraft is scheduled for delivery in 2029 but we plan to have four Airbus aircraft in operation before summer of 2025 and have now secured the lease of new A321LR aircraft with our long-term partner SMBC Aviation Capital Limited” said Bogi Nils Bogason, Icelandair’s CEO.

"We extend our heartfelt gratitude to Icelandair for placing their trust and confidence in Airbus. It fills us with immense pride to welcome Icelandair as a new Airbus customer. By harnessing the exceptional performance of the A321XLR, your airline is forging a path of sustainable growth with remarkable efficiency and a significant reduction in CO2 emissions," expressed Christian Scherer, Airbus Chief Commercial Officer and Head of Airbus International.

With the arrival of the Airbus aircraft Icelandair will retire its Boeing 757 aircraft which have been the backbone of the carrier's fleet since 1990 and enabled it to build an extensive route network making good use of Iceland's unique geographical location. 

Icelandair in June  

In June 2023, the number of passengers travelling with the carrier was 518,527, a 20% increase since June last year. A total of 1.8 million passengers travelled with Icelandair for the first six months of the year, 31% more than at the same time last year.

New market making agreement for Icelandair

Icelandair Group has entered into an agreement with Arion banki hf. for the market making of shares issued by the Company traded on the Nasdaq Iceland Stock Exchange. The purpose of the agreement is to maintain the liquidity of Icelandair's shares, and create a market price and the price formation of the shares in the most efficient and transparent manner.

The agreement stipulates that Arion banki shall submit daily bids and offers to buy and sell Icelandair’s shares in the trading system of the Icelandic Stock Exchange. Each bid and offer must be at least ISK 5,000,000 in market value of the issuer, at a rate set by Arion banki. However, such bids shall not vary by more than 3% from the last transaction price. The bid-ask spreads shall be determined by reference to the stock exchange's price step table as it stands at any given time so that the spread will be as close as possible to 1,5% but not less than 1,45%. Arion banki shall, however, be permitted to present bid and sell offers with a lower price range, e.g. due to circumstances arising from the stock exchange's price step table.

295,874 people travelled with Icelandair in April....

In April 2023, Icelandair‘s passengers were 295,874 compared to 241,914 in April last year, an increase of 22%. Capacity in April was 17% higher than last year, the airline has reported this week. 

Passengers on international flights were 273,191 compared to nearly 219,000 in April 2022, that's an increase of around 25%. Passengers to Iceland were 103,813 and 53,173 from Iceland. Via passengers were around 116,450. 

The airline says that 80% of its international flights were on time or very close to it and the average load factor was 83.4%. Despite increased competition, the load factor on North American routes was 85.3%, and improved by 10.4 ppt compared to April last year.

Domestically, the airline flew 22,683 people on its flights which were 77.2% full and 84% operated on time.

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Route Network	Apr 23	Apr 22	CHG (%)	YTD 23	YTD 22	CHG (%)
Number of Passengers	295,874	241,914	22%	960,162	663,892	45%
Load Factor	83.3%	76.4%	6.9 ppt	79.4%	70.3%	9.1 ppt
Available Seat KM (ASK´000,000)	1,009.6	862.0	17%	3,364.1	2,565.6	31%
Revenue Passenger KM (RPK´000,000)	841.3	658.9	28%	2,672.1	1,803.2	48%
INTERNATIONAL FLIGHTS	Apr 23	Apr 22	CHG (%)	YTD 23	YTD 22	CHG (%)
To market (passengers)	103,813	94,691	10%	391,935	297,742	32%
From market (passengers)	52,928	53,170	0%	190,039	139,260	36%
Via market (passengers)	116,450	71,090	64%	292,993	153,335	91%
Number of Passengers	273,191	218,951	25%	874,967	590,336	48%
Load Factor	83.4%	76.4%	7.0 ppt	79.5%	70.2%	9.3 ppt
Available Seat KM (ASK´000,000)	1,001.0	854.1	17%	3,331.8	2,539.7	31%
Revenue Passenger KM (RPK´000,000)	834.6	652.6	28%	2,647.5	1,782.6	49%
Stage length (KM)	3,027	2,982	2%	2,980	3,024	-1%
On-Time-Performance (Arrivals)	80.0%	85.0%	-5.0 ppt	78.0%	73.5%	4.5 ppt
DOMESTIC FLIGHTS	Apr 23	Apr 22	CHG (%)	YTD 23	YTD 22	CHG (%)
Number of Passengers	22,683	22,963	-1%	85,195	73,556	16%
Load Factor	77.2%	80.3%	-3.1 ppt	76.2%	79.7%	-3.5 ppt
Available Seat KM (ASK´000,000)	8.6	7.9	9%	32.3	25.8	25%
On-Time-Performance (Arrivals)	84%	88%	-4.0 ppt	84%	69%	15.0 ppt
Cargo & Leasing	Apr 23	Apr 22	CHG (%)	YTD 23	YTD 22	CHG (%)
Sold Block Hours - Leasing	1,193	1,017	17%	4,925	4,661	6%
Freight Tonne KM (FTK´000)	14,735	13,551	9%	57,968	47,289	23%
CO2 EMISSIONS	Apr 23	Apr 22	CHG (%)	YTD 23	YTD 22	CHG (%)
Total CO2 emissions tonnes	73,737	64,147	15%	249,460	197,394	26%
CO2 emissions per OTK	0.73	0.79	-7%	0.77	0.87	-12%

Read on for details on Icelandair's upcoming winter schedule. 

March traffic results show increases for Icelandair

Icelandair has just reported its In March 2023 traffic data which showed the airline carried 254,529 passengers compared to nearly 184,000 people in March 2022.

Passengers on international flights totalled 229,800, compared to 160,981 last March, an increase of 43%. Passengers to Iceland were 118,162 and 44,901 from Iceland. Via passengers were around 66,700. On-time performance on international flights was 82%. The load factor on international flights was 81.8%, an increase of 8.2 ppt year-on-year. The load factor was especially high on flights to and from North America, 86.7%. This is a record load factor for North America flights in March.  

Passengers on domestic flights were around 25 thousand, compared to 23 thousand in March 2022. On-time performance was 90%. The load factor on domestic flights was 76.3%.  

Sold block hours in the leasing operation increased by 20%. Freight measured in Freight Ton Kilometers increased by 20% compared to March last year, due to increased capacity with the introduction of a Boeing 767 widebody into the cargo fleet at the end of last year.  

In March 2023 Icelandair carried 254,529 passengers

Icelandair has just reported its In March 2023 traffic data which showed the airline carried 254,529 passengers compared to nearly 184,000 people in March 2022.

Passengers on international flights totalled 229,800, compared to 160,981 last March, an increase of 43%. Passengers to Iceland were 118,162 and 44,901 from Iceland. Via passengers were around 66,700. On-time performance on international flights was 82%. The load factor on international flights was 81.8%, an increase of 8.2 ppt year-on-year. The load factor was especially high on flights to and from North America, 86.7%. This is a record load factor for North America flights in March.  

Passengers on domestic flights were around 25 thousand, compared to 23 thousand in March 2022. On-time performance was 90%. The load factor on domestic flights was 76.3%.  

Sold block hours in the leasing operation increased by 20%. Freight measured in Freight Ton Kilometers increased by 20% compared to March last year, due to increased capacity with the introduction of a Boeing 767 widebody into the cargo fleet at the end of last year.  

Icelandair to move away from Boeing to Airbus......

Icelandair is turning away from Boeing as it signs up for 13 Airbus A321XLR aircraft to replace its ageing Boeing 757 fleet and long-term plans will see the carrier slowly transition away from Boeing 737 MAX fleet.

The deal the Icelandic carrier has signed with Airbus also has options for a further 12 aircraft and the planes are scheduled to start arriving in 2029.  However,  Icelandair is currently in negotiations for leasing four Airbus A321LR to arrive in 2025.   Further additions can be expected in the years thereafter. With the acquisition of the Airbus aircraft, Icelandair will complete the replacement of the Boeing 757.

The agreed purchase price of the 13 aircraft is confidential, however, is understood to be 20% less than the current list prices. Whilst the financing of the aircraft is yet to be determined, Icelandair will explore financing options closer to the delivery dates which is expected to include a sale and lease back deal with two aircraft leasing firms. 

The A321XLR and A321LR aircraft are part of the Airbus A320neo Family of narrow-body aircraft that provide an excellent range, fuel efficiency and lower carbon emissions. The implementation of the aircraft will reduce operating costs, further support Icelandair’s sustainability targets and offer exceptional customer experience through the aircraft design and unique features. The aircraft has around 190 seats in Icelandair’s layout. In comparison, the Boeing 757-200 aircraft has 183, whereas the 737 MAX 8 and the 737 MAX 9 have a passenger capacity of 160 and 178, respectively.

Icelandair carried 209,981 in January.

In January 2023, Icelandair carried nearly 210 thousand passengers, compared to just over 113,400 last year. Capacity in January was 93% of January 2020 levels, the last normal operating January before the pandemic, and 79% of 2019 levels.

Passengers on international flights were 191 thousand, compared to 102 thousand in January 2022, an increase of 88%. Passengers to Iceland were 75 thousand and from Iceland 47 thousand. Via passengers were around 69 thousand. On-time performance on international flights was 75%. On time performance and passenger numbers were affected by weather related disruptions in January. The load factor on international flights improved significantly from 59.5% in January 2022 to 74.6% in January this year.

Passengers on domestic flights were 18,500, compared to around 12 thousand in January 2022. On time performance was 84%. Load factor on domestic flights was 72.4%. Weather in Iceland caused disruption in the domestic network in January, affecting on time performance and passenger numbers.

Sold block hours in charter flights decreased by 3%. Freight measured in Freight Ton Kilometers increased by 31% compared to January last year. The increase in cargo is due to increased capacity with the introduction of a Boeing 767 widebody into the cargo fleet.

Route Network	Jan 23	Jan 22	CHG (%)
Number of Passengers	209,981	113,403	85%
Load Factor	74.6%	59.6%	15.0 ppt
Available Seat KM (ASK´000,000)	797.5	534.1	49%
Revenue Passenger KM (RPK´000,000)	594.7	318.3	87%
INTERNATIONAL FLIGHTS	Jan 23	Jan 22	CHG (%)
To market (passengers)	74,691	45,322	65%
From market (passengers)	47,493	24,751	92%
Via market (passengers)	69,277	31,608	119%
Number of Passengers	191,461	101,681	88%
Load Factor	74.6%	59.5%	15.1 ppt
Available Seat KM (ASK´000,000)	790.1	529.5	49%
Revenue Passenger KM (RPK´000,000)	589.3	314.9	87%
Stage length (KM)	3,000	3,082	-3%
On-Time-Performance (Arrivals)	75.0%	73.0%	2.0 ppt
DOMESTIC FLIGHTS	Jan 23	Jan 22	CHG (%)
Number of Passengers	18,520	11,722	58%
Load Factor	72.4%	72.9%	-0.5 ppt
Available Seat KM (ASK´000,000)	7.4	4.7	60%
On-Time-Performance (Arrivals)	84%	65%	19.0 ppt
Cargo & Leasing	Jan 23	Jan 22	CHG (%)
Sold Block Hours - Leasing	1,051	1,083	-3%
Freight Tonne KM (FTK´000)	13,834	10,600	31%
CO2 EMISSIONS	Jan 23	Jan 22	CHG (%)
Total CO2 emissions tonnes	57,850	41,470	39%
CO2 emissions per OTK	0.83	1.07	-23%

Flights from the UK to USA, Canada & Iceland | Icelandair

Icelandair: 2022 a turnaround year

The latest results from Icelandair have now been released for 2022 for what has been described as a turnaround year. 

Highlights include: 

Full-year EBIT USD 19 million, improving by USD 136 million

Strong revenue generation resulting in the best fourth quarter performance since 2015

Capacity in Q4 2022 95% of the 2019 capacity

Unit revenue in Q4 up 13% year-on-year

Weather disruptions in December negatively affecting results in Q4 2022

Leasing operation gaining momentum and strong profitability in 2022

A new B767-300 freighter entered operations in December

Seven B737 MAX aircraft added to the fleet in 2022

Strong balance sheet and total liquidity of USD 318 million at end of year

Reduction in CO2 emissions by 17% per OTK compared to 2021

January 2023 record sales month and good outlook in all markets

EBIT ratio expected to be in the 4-6% range for the full year of 2023

Icelandair President and CEO Bogi Nils Bogason made this statement on the airline's performance during 2022, which has been seen by many as a key turnaround year for the financially constrained carrier, “The year 2022 was characterized by a great turnaround of our business. Strong revenue generation with record passenger revenue in the second half of the year and significant EBIT improvement shows that our business model has proven its worth yet again. We are back on track, stronger than ever and ready to operate the largest flight schedule, in terms of frequency and destinations, in the history of Icelandair.

Our strategy and actions throughout the pandemic ensured we were prepared to rapidly increase capacity to meet the steep increase in demand in all our markets. In 2022, we doubled our flight schedule and transported 3.7 million passengers to 51 destinations.

As the aviation industry as a whole, we experienced external operational challenges that affected the summer peak, in addition to severe weather conditions towards the end of the year. We were, however, in a good position to respond to these challenges and reduce the impact on our customers due to our extensive flight schedule, frequency of flights and the resourcefulness of our employees.

Icelandair Cargo has been an integral part in our recovery, ensuring important revenue generation throughout the pandemic and during the ramp-up. We believe that our plans of establishing a cargo hub in Iceland will provide great opportunities for the Company as well as Icelandic businesses. Furthermore, our leasing business emerged strongly from Covid with 2022 being one of the best performing years in the history of Loftleidir-Icelandic.

The successful ramp-up of our operations following the pandemic has been crucial for the recovery of Icelandic tourism and economy. In 2022, we brought around 740 thousand tourists to Iceland and recruited around 1,000 employees. To safeguard the value that aviation and travel create, it is important to ensure a sustainable future of these industries. We have a strong focus on economic, social and environmental sustainability across our operations and are working with our key stakeholders towards our goals in this area.

Our operating environment will remain challenging this year with inflation and increased salary cost. We are, however, confident that people will continue to prioritize travel and there will be great opportunities for Iceland as a destination as we see reflected in our near-term booking flow.

I would like to thank our customers for their trust, our partners for their cooperation and our shareholders for their support during the year. However, first and foremost, I would like to thank our employees for what we have achieved together. With our exceptional team, robust foundations of our business, healthy financial position and of course our extensive and flexible route network that allows us to constantly adapt, we look forward to seizing the opportunities ahead and continuing to bring the spirit of Iceland to the world.”

Consolidated Financial Statements Icelandair Group 

Record passenger revenue of USD$408.3 million leads to USD$58 million profit for Icelandair in third-quarter

Icelandair has seen record passenger revenue of USD$408.3 million leads to USD$58 million profit during the third quarter. 

Photo Icelandair

BOGI NILS BOGASON, PRESIDENT & CEO said : "We reached 82% of 2019 capacity and more than doubled the number of passengers between years. It is great to see how fast our transatlantic market has recovered, accounting for 43% of the total number of passengers in the quarter. Continued improvement of revenue generation from our Saga Premium product positively impacted unit revenue. Furthermore, our cargo and leasing businesses continued to strongly complement our revenue generation.

Achieving these results against a backdrop of considerable challenges during the ramp-up phase has required a joint effort across the Company. Disruptions at airports and in supply chains impacted our operations as well as our customers’ experience. I would like to thank our employees for the dedication and hard work over the past weeks and months, our customers for their trust and patience, and our tourism partners for their great cooperation in quickly ramping up tourism services in Iceland.

The booking status in the fourth quarter is strong although we are expecting some headwinds this winter. The operating environment will remain challenging, where we are seeing interest rates and various costs on the rise which will most likely impact demand. We, however, believe there will continue to be great opportunities for Iceland as an attractive destination and we have a strong foundation to build on. Our financial position is robust with strong liquidity and our extensive route network, as well as our flexibility allows us to move quickly and adjust our operations and services to the situation."

EBIT USD 92.7 million with 19% EBIT margin; improving by USD 84.5 million year-on-year

Record passenger revenue USD 408.3 million

Record load factor and high unit revenue

Number of passengers 1.4 million; more than doubling from last year

Unit revenues up by 38% year-on-year while unit cost excluding fuel decreased by 8%

Strongest cash position ever at the end of Q3

Well positioned to weather headwinds and seize opportunities in the coming months

Icelandair results (globenewswire.com)

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Winter in Iceland: travel advice and tips

Don't be daunted by winter travel to Iceland. There’s so much to love about winter here – including the short and softly lit daylight hours, the long nights potentially filled with northern lights, and the beautiful snowy landscapes. Sunrise happens late, so you don't have to get out of bed early to catch the pink dawn skies, and sunset can last for hours.

Travel to Iceland in winter: weather conditions, what to wear, how to stay safe | Icelandair

Icelandair to add Gran Canaria to its scheduled route network from November

Photo by Gran Canaria For Nomad List on Unsplash

Las Palmas, Gran Canaria is a new addition to Icelandair‘s Route Network, with the first scheduled flight on 15 November. Icelandair has before offered charter flights for travel agencies and tour operators to Las Palmas, but this is the first time the airline introduces scheduled flights to the Canary Islands destination. Flights will be on offer once a week from 15 November 2022 to 11 April 2023, with departure from Keflavik at 9:30 AM every Tuesday.

Gran Canaria is the third biggest of the Canary Islands and packs everything needed for an ideal vacation, with endless sunshine, diverse landscapes, exciting ocean activities and relaxing beach escapes. With a population of 870,000, it is often described as a miniature continent because of its diverse flora and fauna, high mountain ranges, volcanoes, rivers and waterfalls, sand dunes, beaches, forests and wine yards.

Bogi Nils Bogason, Icelandair CEO: “We are excited to introduce Gran Canaria to our extensive Route Network, reaching 40 destinations in Europe and North America. Last year we added Tenerife to our schedule and we have received very good feedback from our customers. After the integration of Icelandair and tour operator VITA, new opportunities like these have emerged, which strengthens our route network and increases the service to our customers.”