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Norwegian narrows losses despite Boeing 737 Max grounding

Norwegian narrows losses despite 737 Max grounding

2019 04 25

2019 04 25

Low-cost carrier Norwegian has reported a net loss of NOK1,489 million (US$135 million) for the first quarter of 2019, down eight per cent on the same period last year.

The grounding of the airline’s 18 Boeing 737 Max 8 aircraft will cost it up to NOK500 million, Norwegian said.

Authorities around the world suspended operations of the aircraft type, which makes up ten per cent of the Norwegian fleet, after crashes at Lion Air and Ethiopian Airlines.

Total revenue for the quarter was NOK8 billion, up 14 per cent, primarily driven by intercontinental growth and increased traffic in the Nordics.

More than eight million passengers flew with Norwegian during the quarter, growth of nine per cent.

The load factor was 81 per cent.

The company’s unit cost excluding fuel, decreased by eight per cent compared to the first quarter of 2018.

“I’m pleased with the positive developments this quarter, despite the 737 MAX issues.

“We have taken a series of initiatives to improve profitability by reducing costs and increasing revenue.

“We are optimising our base structure and route network to streamline the operation as well as divesting aircraft, postponing aircraft deliveries and not least implementing our internal cost reduction program, which will boost our financials.

“I am also pleased that booking figures and overall demand for the coming months look promising,” said chief executive of Norwegian, Bjørn Kjos.

In March, Norwegian temporarily suspended operation of the Boeing 737-MAX 8.

The airline combined flights and booked customers to other departures within Norwegian’s own network, consequently reducing the impact on passengers.

“Our dedicated colleagues at Norwegian have been working day and night to find solutions for our customers.

“They will continue to do their utmost to ensure that all flights continue to depart as planned, regardless of how long the Max stays out of service,” Kjos continued.

“We have had some productive meetings with Boeing where we have discussed how we can manoeuvre through the difficulties the Max situation is causing Norwegian,” Kjos added.

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