Norwegian reports strong results in the second quarter 2023

posted on 24th August 2023 by Eddie Saunders
Norwegian reports strong results in the second quarter 2023

Norwegian delivered an operating profit (EBIT) of NOK 651 million in the second quarter, which was characterised by strong operational performance amidst ramping-up into the busy summer travel season.

Furthermore, Norwegian and Strawberry’s new loyalty company today announced that Avida has been selected as the preferred financial partner.

Together with Norwegian’s recently announced agreement to acquire Widerøe, these new partnerships will contribute to offering even better and seamless travel experiences.

For the second quarter of 2023, Norwegian delivered an operating profit (EBIT) of NOK 651 million. Profit before tax (EBT) amounted to NOK 538 million.

The liquidity position improved through the quarter with cash and cash equivalents exceeding NOK 9.3 billion. At quarter-end, Norwegian’s fleet comprised 81 aircraft.

High load factor and operational excellence

Norwegian had 5.6 million passengers in the quarter, up from 5.0 million passengers in the second quarter of 2022. Production (ASK) was 8.7 billion seat kilometres, while passenger traffic (RPK) was 7.3 billion seat kilometres.

Production was up 44 percent from the previous quarter as Norwegian ramped up capacity ahead of the busy summer travel season.

The quarterly load factor was 84.4 percent, up from 81.2 percent in the same period last year.

Geir Karlsen, CEO of Norwegian said, “This quarter has demonstrated our ability to ramp up capacity and deliver a superb operational performance to become one of the top airlines in Europe.

“These results have been made possible thanks to over 4,700 of our colleagues working tirelessly to ensure our passengers arrive at their destinations as smoothly as possible.

“By solely flying with our own aircraft and crew, we can deliver “the Norwegian way” to all our customers. Our seamless customer experience has made us one of the most loved airlines in the Nordics.”

Punctuality, share of flights departing on schedule, was 81.5 percent in the quarter, up from 78.8 percent in the same period last year.

Regularity, share of flights taking place, was 99.5 percent. Cirium, the global aviation consultancy, named Norwegian the most on-time European airline in May.

In April, June, and July, Norwegian finished among the top three European airlines.

“The summer season of 2023 will be one of the best in our history, and I am happy that forward bookings remain strong with business travel returning and others planning their autumn holidays,” said Karlsen.

In April, Norwegian announced a landmark partnership with Norsk e-Fuel to build the world’s first full scale e-fuel plant in Mosjøen, Norway. The plant will produce sustainable aviation fuels (SAF). The partnership is estimated to secure approximately 20 percent of Norwegian’s total demand for SAF by 2030. In addition, Norwegian will invest more than NOK 50 million for a minority equity stake in the company.

In June, Norwegian announced a new partnership with Strawberry, formerly Nordic Choice Hotels, to establish a joint loyalty company, offering a shared ecosystem for loyalty programmes.

The loyalty company today reached its next milestone with the announcement that KKR owned Avida Finans AB will become the preferred financial partner, developing next generation financial services to more than 7 million members.

In July, Norwegian announced that it had entered into an agreement to acquire Widerøe, the regional Norwegian carrier, for a cash consideration of NOK 1,125 million, subject to certain closing conditions.

The transaction will create an improved customer offering with better connectivity and seamless end-to-end experience.

In addition, the acquisition will be accretive to shareholders through linking the complimentary route networks together and realising significant operational synergies.

Closing of the transaction, which is subject to approval by the Norwegian Competition Authority, is expected by the end of the fourth quarter of 2023.