Category Archives: Icelandair Group

Icelandair to operate two Boeing 767-300s, Air Iceland to become a new Bombardier Q400 operator

Icelandair Group (Icelandair and Air Iceland) (Reykjavik) has announced Icelandair will operate two Boeing 767-300s. The Group has also announced plans to replace Air Iceland’s aging Fokker 50 fleet with newer Bombardier DHC-8-402 (Q400) aircraft. The Group issued this statement:

Icelandair Group logo

The Board of Directors of Icelandair Group has decided to update the fleet policies of the subsidiaries Icelandair and Air Iceland.

All five Fokker 50 aircraft that Air Iceland operates will be sold and three Bombardier Dash 8 Q400 will replace it. After that Air Iceland will operate five aircraft, three Bombardier Q400 and two Q200. The Q400 aircraft can seat 74 passengers while the Fokker 50 takes 50 passengers.

Air Iceland logo

The airline’s operations will be simplified and optimised as number of aircraft decrease and synergies will increase as all aircraft will be from the same manufacturer. As the Q400 is faster and has a longer range,

Air Iceland 3.2015 Route Map

Air Iceland Route Map: Air Iceland flies domestically in Iceland and adjacently to Greenland.

Air Iceland sees opportunities in new markets. The company will be better equipped to service the domestic market as the aircraft are larger and travel time will be shorter. The airline aims to increase the number of foreign tourists on board its aircraft going forward.

Icelandair logo-1 (LRW)

In 2015 Icelandair will operate 23 Boeing 757-200 that take 183 passengers and one 757-300 that takes 220 passengers. The company owns 22 of those aircraft and leases two that will be redelivered this autumn.

Above Copyright Photo: Boeing 757-208 TF-FIN (msn 28989) taxies at London (Heathrow). LHR is a likely place where the larger Boeing 767-300 would be utilized along with New York (JFK).

 

It has been decided that they will be replaced with two Boeing 767-300 aircraft that take 260 passengers that will be added to the route network as of the spring of 2016. Larger aircraft are more feasible due to high load factors on many routes all year round and limited number of landing slots on certain airports. The increase of the fleet in the last few years has made it more economical to have more than one size of aircraft in the fleet. The Boeing 767 aircraft is similar to the 757 in terms of maintenance and crew training and the airline has experience in operating that type.

 

Above Copyright Photo: Daniel White – Bruce Drum Collection. Icelandair is very familiar with the Boeing 767-300 as subsidiary Loftleidir Icelandic has been a past operator of the type. Boeing 767-3Y0 ER TF-FIA (msn 24953) taxies at Sanford (SFB).

Loftleidir Icelandic logo

Icelandair Group’s subsidiary, Loftleidir Icelandic, has operated 767 aircraft in leasing projects that have been maintained by Icelandair. The aircraft has longer range than the 757 which will create new opportunities for the route network.

It has not been decided whether the new aircraft will be purchased or leased.

Bjorgolfur Johannsson, President and CEO of Icelandair Group: “Operating one type of aircraft has been very economical for Icelandair but when the route network and the fleet reaches a certain size it becomes more feasible to have a broader range of aircraft in the fleet. High load factors all year round and limited number of landing slots on certain airports also support this decision. In terms of Air Iceland a simpler and more economical fleet will make the operations better as crew training will be simpler.

We foresee further growth opportunities in the coming years with these changes to the fleet policy for passenger aircraft. Both the Boeing 767 and Q400 aircraft can service markets that the current fleet cannot, which will enable us to go into new markets and connect them to the current route network.”

Top Copyright Photo: Wingnut/AirlinersGallery.com. The five Fokker F.27 Mk. 050s (Fokker 50s) will be sold. Flugfelag Islands-Air Iceland Fokker F.27 Mk. 050 TF-JMO (msn 20205) lands at the Reykjavik (RKV) base.

Air Iceland aircraft slide show: AG Airline Slide Show

Icelandair aircraft slide show: AG Airline Slide Show

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Icelandair Group’s 2014 net profit increases 18% to $66.5 million

Icelandair Group (Icelandair, Air Iceland and Loftleidir) (Reykjavik) reported a 2014 net profit of $66.5 million, up 18% from the previous year. The airline issued this statement:

Björgólfur Jóhannsson, President and CEO commented:

“The Group’s performance in 2014 exceeded management projections from the beginning of the year, with EBITDA at the upper limits of the Company’s most recent earnings estimate. Net profit amounted to $66.5 million, up by 18% from last year. EBITDA amounted to $154.3 million, up by 7% between years. Results for the fourth quarter were in line with the earnings estimate published at the end of last October. The strong performance was the result of a number of interacting positive factors, including falling fuel prices, increased demand in the North Atlantic market – which was met by increased supply – and good results from charter operations. The depreciation of the euro against the US dollar had a negative impact on the Group’s operations, and in addition the maintenance cost of cargo aircraft was significantly higher than anticipated.

As of 2010 Icelandair Group’s operations have shown growing momentum. Income has grown by $395 million, amounting to $1.1 billion in 2014. In recent years we have continued to close the ranks of our staff and secured a steady growth of our infrastructure in preparation for the future. Prudence is and will continue to be the key to long-term profitable growth for the Company. A strong equity position and underlying cash flow will underpin our ability to undertake profitable investments to improve our competitiveness for the long term. We have a clear future vision and an outstanding staff, to whom I attribute first and foremost the good results we achieved last year.

We are assuming continued profitable organic growth in Icelandair Group’s operations in 2015. The Group’s international flight schedule will be 14% larger than in 2014, and a significant development in the Company’s hotel operations in Central Reykjavik is foreseeable. On the whole, prospects in the Icelandic tourist industry are positive, and we also believe that the outlook for cargo and charter operations in 2015 is encouraging.

The EBITDA forecast for 2015 has been raised in comparison with 2014, with EBITDA now projected in the range of $160-165 million. The fall in fuel prices is the single cost item most responsible for the rise in EBITDA. It should be noted, however, that external factors, like fluctuations in fuel price and on FX markets along with the outcome of collective-bargaining agreements in the labour market can affect the Company’s performance significantly.”

Read the full report presentation: CLICK HERE

Copyright Photo: SPA/AirlinersGallery.com. This summer Icelandair will operate 24 Boeing 757 aircraft, one aircraft more than was previously announced. Boeing 757-208 TF-FIN (msn 28989) climbs away from London (Heathrow) bound for Keflavik near Reykjavik.

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Icelandair has a better than expected year in 2013, reporting a pretax profit of $71 million

Icelandair Group (Icelandair) (Keflavik) reported its financial results for 2013 (all dollar figures in US dollars):

  • Profit before taxes amounted to $71.0 million, up by $13.6 million or 24% between years
  • Income rose between years by 13.8%
  • EBITDA in the fourth quarter amounted $6.8 million, up by $0.9 million between years
  • The equity ratio at year-end 2013 was 42%, as compared to 39% at year-end 2012
  • Net interest-bearing debts were reduced by $95.6 million over the year and were negative at year-end in the amount of $77.5 million
  • The Board of Directors has proposed a dividend payment of ISK 2,150 million to shareholders in 2014, which corresponds ISK 0.43 per share.

Björgólfur Jóhannsson, President and CEO

“The Company’s performance in 2013 is good and considerably better than our budget projected in the beginning of the year.  Profit before taxes amounted to $71.0 million, up by $13.6 million between years. Like recent years, last year was characterised by profitable organic growth, which is in line with our strategy. Capacity in our route network was increased by 16% from last year, and the number of passengers increased by 12%. The Company’s largest market in international flight services is the market between Europe and North-America, which has been the principal driving force of our growth in recent years. The tourist market to Iceland has also shown significant growth, and the demand for domestic tourist services has increased rapidly. Concurrently with this expansion, companies within Icelandair Group have found opportunities for profitable growth.

The rapid growth of recent years has tested the Company’s infrastructure, which is now stronger than ever before. The main reasons for the good performance of the year include favourable external conditions, increase in tourism in Iceland and last but not the least our strong team of employees which are a very important factor in what we have achieved. It is always satisfying when things are going well, but there is no room for complacency. There are various challenges ahead that we need to address.  The principal challenge is the increasing competition, and in addition our contracts with some of our classes of employees have expired, which creates some uncertainty. Nevertheless, the Company’s business model has proven sound, our finances are solid and our cash position is strong. Icelandair Group is therefore well positioned to take on the future. The Company’s budget for 2014 projects EBITDA at $145-150 million.”

Trip Report on Icelandair by the Sydney Morning Herald on a London-Halifax trip: CLICK HERE

Copyright Photo: Stefan Sjogren/AirlinersGallery.com. Boeing 757-208 TF-FIJ (msn 25085) lands in Stockholm (Arlanda).

Icelandair: AG Slide Show

Icelandair Group’s 2Q net profit jumps 29% to $18.5 million

Icelandair Group (Icelandair) (Keflavik) reported its second quarter net profit increased 29 percent to $18.5 million, up from $14.3 million for the quarter a year ago.

Read the full report: CLICK HERE

Icelandair Group Fleet Data:

Icelandair Group Fleet (8:2013)

Copyright Photo: TMK Photography/Airlinersgallery.com. Boeing 757-208 TF-FIJ (msn 25085) approaches the runway at Toronto (Pearson) after its flight from the Keflavik hub (near Reykjavik).

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Icelandair remains in the red with a 1Q net loss of $18.3 million

Icelandair Group (Icelandair) (Keflavik) reported a net loss of $18.3 million in the first quarter, an increase from a net loss of $13.2 million in the same quarter a year ago.

The airline issued this statement:

Icelandair Group organic growth continues

  • Losses after taxes USD $18.3 million, as compared to USD $13.2 million in the preceding year
  • Performance in the quarter exceeded management projections
  • EBITDA negative by USD $8.3 million, as compared to negative USD $3.0 million last year
  • Passenger revenues increased by 24% between years
  • Total revenue increased by 10%
  • Equity ratio was 32% at the end of March
  • Net cash provided by operating activities USD 78.5 million, as compared to USD 86.1 million in the preceding year

Björgólfur Jóhannsson, President and CEO:

“Icelandair Group’s performance over the quarter was better than our budget projected and estimates of continued growth materialized. Capacity on international flights increased by just short of a quarter in the first three months of the year, and the increase in passenger numbers over the same period was 18%. The greatest increase was in the number of passengers on the North Atlantic market, about 40%. The number of passengers in the tourist market to Iceland also increased significantly from last year, with a positive impact for all tourist services in Iceland. The Group’s freight activities have shown a turnaround. Freight charter projects have been downsized systematically, and the focus has been shifted to scheduled air freight services, which has returned good results.

At the start of the year we issued an EBITDA forecast for 2013 in the range of USD 115-120 million. The performance in the first quarter was in excess of the forecast, and in addition operating prospects are generally positive. Based on adjusted assumptions, EBITDA for the year is now projected at USD 122-127 million.”

Copyright Photo: Antony J. Best. Boeing 757-308 WL TF-FIX (msn 29434) departs from London (Heathrow).

Icelandair: AG Slide Show

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Route Map:

Icelandair 5:2013 Route Map

Icelandair reports a second quarter net profit of $14.3 million, considers acquiring additional aircraft types

Icelandair Group (Icelandair) (Keflavik) reported a second quarter net profit of $14.3 million.

In addition, in its report, the group stated it is looking at its fleet options with a long-term fleet strategy. Here is the official statement:

TWO OPTIONS CURRENTLY UNDER CONSIDERATION

  • |  Work in progress on a long-term strategy for Icelandair Group’s fleet
  • |  The work done in close co-operation with the manufacturers Boeing and Airbus
  • |  Other aircraft manufacturer are also being monitored
  • |  A decision on the future fleet will be made in near future
  • |  Options being evaluated:

Option 1: Single fleet of Boeing 757 aircraft until 2022

Option 2: Mixed fleet of Boeing 757 and smaller aircraft

Read the full report: CLICK HERE

Copyright Photo: Keith Burton. Besides utilizing its Boeing 757 fleet for scheduled passenger and charter operations, the flag carrier also operates the Boeing 757 as a freighter. Icelandair Cargo Boeing 757-23A PCF TF-FIG (msn 24456) climbs away from Southend with its additional “Absolutely Fresh” titles and logo for its fish-hauling operations.

Icelandair: