Norwegian Air Shuttle said it expected future bookings to continue rising as it reported its first results since coming out of bankruptcy, but did not provide a full-year outlook.
The airline said it would not need to raise more cash due to the easing of Covid travel restrictions which had helped reservations, but warned that pandemic uncertainty was still high.
Norwegian’s losses on a core earnings basis, widened to NKR 1.86bn from NKR 467m in the first six months of this year. Revenues fell 92% to NKR 591m.
On a pre-tax basis, which took into account a financial restructuring completed in May, the company swung to a profit of NKR 1.59bn from a loss of NKR 4.79bn last year.
“Forward bookings continue to increase in response to the relaxation of travel restrictions and the rollout of international vaccination programmes. We expect to see this trend continue in the remaining months in 2021 and through 2022,” said chief executive Geir Karlsen.
Norwegian found itself struggling under a massive debt mountain which it had racked up to fund a now-abandoned lossmaking transatlantic long-haul schedule.
The company has reorganised to focus on its home Nordic region and flights from there to Europe.
Norwegian ended 2019 with 156 planes but only 10 aircraft were operating this spring. By the end of June, that had increased to 51 aircraft and Norwegian estimated it would operate about 70 next year should the recovery in air traffic go to plan.
It managed to slash its debt by 96% from a year earlier in its financial restructuring in Ireland and Norway that ended in a large debt-for-equity swap and left creditors owning most of the airline.
Norwegian now operates most of its aircraft on a power-by-the-hour basis, meaning it only pays for them when it uses them so its costs should be much more in line with demand. Its cash burn in June – the first full month since its restructuring – was significantly reduced from the level at the start of the pandemic.
