Norwegian Air Reports Third Quarter Net Loss of NOK 980 Million on 91 Percent Fewer Passengers
The airline carried approximately one million passengers in the third quarter, a 91 percent year-over-year decline, which was an improvement from a Q2 passenger decline of 99 percent. Naturally, Norwegian’s results reflect the impact of the global COVID-19 pandemic.
On Tuesday (November 10, 2020), Norwegian Air announced a third quarter 2020 net loss of (NOK 980) million (USD 108.5) million on a 91 percent year-over year decrease in passengers. During the quarter the carrier successfully converted debt to equity and implemented a series of strict cost control measures. Air travel demand was substantially impacted by a second wave of COVID-19 infections and the associated travel restrictions. Norwegian operated around 25 short-haul aircraft out of a fleet of 140 during the quarter and carried approximately one million guests. The company converted lease liabilities and vendor debt to equity which resulted in a Q3 positive equity impact of NOK 2.9 billion (US$ 321.3) million. Since the start of 2020, Norwegian’s restructuring efforts have improved equity by NOK 18.2 billion (USD 2.0) billion. In Tuesday’s announcement, Norwegian Air’s CEO, Jacob Schram, said,
“Our third-quarter results clearly show that the effects of the global COVID-19 pandemic continue to heavily impact our operations and financial position. Changing government travel advice and further restrictions as a result of a second wave of infections seen in many countries have further contributed to a decrease in customer confidence and certain routes becoming once again unviable leading us to rapidly adapt our network. We continue to work tirelessly to make sure that we can emerge from this crisis as a stronger company, well-positioned for future competition, and thank our creditors, bondholders, and shareholders who have shown us strong support throughout.”
Norwegian Air carried around one million passengers in the quarter, compared to 10.53 million during the third quarter of 2019. Available seat kilometers (ASK) was down 94 percent and passenger revenue per kilometer (RPK or traffic) decreased by 96 percent. The airline’s third quarter load factor declined year-over-year by 30.6 percent to 60.6 percent, while the company’s on-time performance was 97.4 percent, an improvement from 74.7 percent during Q3 2019.
Norwegian Air operates a modern fuel efficient fleet and offers guests value and choice throughout their journey including free ‘gate to gate’ Wi-Fi allowing customers to remain connected throughout their onboard experience. The carrier is the world’s fifth largest low-cost carrier (LCC) and carried over 36 million passengers in 2019. Norwegian also received awards for “Loyalty Program of the Year’ and ‘Best Customer Service’ at the 2020 Freddie Awards for their Norwegian Reward loyalty program. Additionally, the airline was voted ‘Europe’s Best Low-Cost Airline’ by passengers at the SkyTrax World Airline Awards from 2013-2019 as well as ‘World’s Best Low-Cost Long-Haul Airline’ for the past five years.
Source: Norwegian Air