Thanks to strong forward bookings for the summer and pent-up demand, Norwegian is optimistic to leave a weak first quarter behind it. The airline reported a NOK -1.033 billion net loss in the first three months of 2022, blaming it on low seasonal traffic, Omicron, and the effects of the war in Ukraine, it said on May 13. Norwegian ends weak Q1 with net loss but bullish on the summer.
The net loss was almost on par with the NOK -1.189 billion of Q1 2021. Norwegian improved its operating result, reporting a loss of NOK -848.6 million compared to NOK -1.462 billion. EBITDAR was NOK -468 million versus NOK -1.113 billion in Q1 2021 but down on NOK 114 million in Q4. Operating expenses increased to NOK 2.384 billion from NOK 1.368 billion. Personnel costs were down, fuel was up.
Total revenues increased to NOK 1.916 billion from just NOK 255 million, but they were 25 percent down on Q4 due to the weaker season. Unit revenues were about the same for both first quarters. Ancillary revenues were NOK 155 per passenger, down from NOK 212 in Q1 2021. Norwegian carried 2.2 million passengers compared to 0.21 million. Load factors almost doubled to 76.8 percent.
Norwegian ended the quarter with NOK 7.5 billion in cash and cash equivalents compared to NOK 7.7 billion at the end of Q4, which means that the cash burn for the period was NOK 160 million. The carrier produced a NOK 107 million positive operating cash flow. Total liabilities stood at NOK 17.8 billion versus NOK 15.6 billion.
The strong bookings for the summer are seen at both leisure and corporate travel, despite fares being “significantly up from 2019.” This should produce stronger load factors and yields. Norwegian plans to grow its full-year capacity to 28 million available seats per kilometer (ASK) compared to 9.4 million in 2021 and 100 million in 2019.
At the end of April, Norwegian had 61 aircraft available and will grow this to seventy in the summer period. By summer 2023, another fifteen will join the fleet, including ten Boeing MAX 8s that have been leased from AerCap that will arrive next spring. The carrier is in the process of leasing another five.
Norwegian reported a NOK 1.870 billion net profit for 2021.
