Norwegian loses one billion kroner in three months

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File photo: Heiko Junge/NTB Scanpix
11:38 CEST+02:00
Fuel price changes have left low budget Nordic airline Norwegian at a loss of 992 million Norwegian kroner ($122 million) so far in 2016, despite many of its aircraft being full.

Norwegian, Scandinavia's second biggest airline, posted the results from the first quarter of 2016 in a press release on its website on Thursday. While the company reported an underlying improvement of more than 400 million kroner ($49 million), losses of 528 million kroner ($65 million) from forward jet-fuel contracts resulted in an overall pre-tax loss of 992 million kroner.

Forward jet-fuel contracts, which fix the price paid by airlines for fuel for an agreed period, can result in losses to the airline if the actual fuel price dips too far below the contracted level.

Exchange rate fluctuations were also stated by the company to have affected its overall profits.

Norwegian posted losses of 777 million ($96 million) kroner for the same period in 2015.

Despite the negative nature of the figures, the company said that the results reflected strong business activity, with 85 percent of its seats sold in a season that is traditionally slow.

The airline carried six million passengers during the first three months of 2016, an increase of 17 percent on 2015, and announced new long-haul routes between Paris and the United States.

“Our load factor continues to be very high. The long-haul operations are becoming significantly more important. We also see growth in the Nordics and in Europe in general,” Norwegian’s CEO Bjørn Kjos said in the company’s press release.

“We also see that the Scandinavian and European route networks both play an increasingly important role in our long-haul strategy, as many of our passengers connect from short haul to long haul and vice versa… This indicates that passengers appreciate a high quality product at a low price,” Kjos continued.

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A total of 26 million passengers flew with Norwegian during 2015.


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