Category Archives: Norwegian Air Shuttle

Norwegian’s reconstruction process in Ireland is approved

Norwegian Air Shuttle made this announcement:

Norwegian’s reconstruction process in Ireland, called the Examinership, was approved by the judge in the Irish High Court on March 26. Based on this decision, Norwegian will now send the same proposal for voting in Norway. Following this, the company will start the process of raising capital with the goal of a final resolution by the end of May.

The Examiner process in Ireland is a reconstruction involving several of the company’s Irish subsidiaries. The goal of the process, which started on November 18, 2020, is primarily to strengthen the company financially and to rightsize the fleet in order to adapt to future demands.

The verdict from the Irish High Court was reached following meetings with the company’s creditors, whereby a large majority voted in favor of the reconstruction process. A similar voting process will now take place with the creditors in the Norwegian reconstruction during the next 14 days, prior to the final ruling from the Norwegian Court. The Norwegian reconstruction is therefore continuing as planned, and is expected to be completed by mid May.

“This is a demanding and ongoing process, however, the result of the court rulings enforces our beliefs of a positive final outcome. We are looking forward to and are preparing fora post-pandemic world, without travel restrictions and open borders.”Said Schram.

The decision from the Irish High Court will be legally binding following an appeal period of one month and the company will technically still be in the Examinership until the process of capital raise is finalized. Given that the court proceedings continue as planned, Norwegian’s goal is to finalize the capital raise by the end of May 2021.

Norwegian Air International is an Irish semi-ultra budget airline and a fully integrated subsidiary of Norwegian Air Shuttle, using its corporate identity. It operates flights to destinations in Europe and the Middle East from several bases in Denmark, Finland, Spain, and the United Kingdom, and is headquartered at Dublin Airport.

Norwegian Air International aircraft photo gallery:

Norwegian Air International aircraft slide show:

 

Norwegian to drop the Boeing 737 MAX entirely

Norwegian Air Shuttle has contracted with aircraft broker Orix Aviation to market 12 of its 18 delivered, but grounded, Boeing 737 MAX aircraft according to E24.

Norwegian is not expected to operate the type ever again. Instead the company will concentrate on the Boeing 737-800 NG as it scales back in order to survive.

Norwegian is also trying to cancel its order for the remaining MAX aircraft Boeing was preparing to build and deliver.

Norwegian cancels order for Airbus A320neo aircraft, submits restructuring plan

Norwegian Air Shuttle has cancelled its order for Airbus A320neo aircraft.

The airline had previously signed an order for 100 A320neo aircraft with Airbus.

In other news, Norwegian has sent its restructuring plan to its creditors and shareholders. The airline issued this statement:

On March 11, Norwegian’s financial reconstruction plan was sent to its creditors and shareholders. If the plan is approved by the Irish and Norwegian courts in the coming weeks, the company can continue the reconstruction processes and initiate a capital raise in April, targeting completion in May 2021.

Jacob Schram, CEO of Norwegian, said: “We have had many constructive and challenging negotiations with creditors since the indicative plan was presented on January 14, 2021. The Examiner in Ireland and the Reconstructor in Norway both believe that this plan is in the interest of the creditors and shareholders of the company. This is an important milestone in the process of securing Norwegian’s future.”

The Examiner will firstly present formal proposals for the restructuring based on the plan presented to the creditors of the company. Following the necessary creditor meetings the proposals will then be presented to the Irish High Court for approval. The proposals outline how creditors will be dealt with in the actual reconstruction. Unsecured creditors who will not participate in the planned capital raise, will be entitled to cash and a dividend totaling to around five percent. The dividend claims may be converted to shares, in total representing approximately 25 percent of the company’s share capital following the restructuring. New investors in the capital raise will receive approximately 70 percent of the post-restructuring share capital, and current shareholders approximately five percent.

Geir Karlsen, CFO of Norwegian, said: “It is hoped that the Irish High Court will make their final decision within the next couple of weeks. If approved by the Irish Court, the plan will be dealt within the reconstruction process in Norway. If everything goes according to plan, we will be able to carry out the capital raise in May.”

Norwegian has sought to identify solutions to refund a small share of customers with claims from prior to entering the examinership on November 18th, 2020. Approximately 98 percent of refund claims booked directly with Norwegian, were refunded before the commencement of the reconstruction process. Despite discussions with the Examiner and Reconstructor, it has unfortunately proven impossible to allow the reimbursement of the outstanding refund claims to customers due to the principles of the restructuring processes.

COVID-19 heavily influences Norwegian’s January traffic figures

Norwegian Air’s traffic figures for January are heavily influenced by lower demand caused by continued travel restrictions across Europe.

In January, 74,224 customers flew with Norwegian, a decrease of 96 percent compared to the same period last year. The capacity (ASK) was down 98 percent, and the total passenger traffic (RPK) was down by 99 percent. The load factor was 35.9 percent, down 45 percentage points.

Jacob Schram, CEO of Norwegian, said: “The pandemic continues to have a negative impact on our business as travel restrictions remain. We are doing everything in our power to come out of the examinership as a stronger, more competitive airline and we look forward to welcoming more customers on board as travel restrictions are lifted.”

Norwegian operated eight aircraft on average in January, mainly on domestic routes in Norway. The company operated 96.8 percent of its scheduled flights in January, whereof 90.4 percent departed on time.

In other news, Norwegian also reported its fourth quarter results. As expected, the results were heavily impacted by COVID-19 and travel restrictions in all markets. The net loss was NOK 16.6 billion, including impairment of NOK 12.8 billion. The operating expenses before leasing and depreciation were reduced by 82 percent compared to the same quarter last year. In 2020, the company reduced net interest-bearing debt by NOK 18 billon. The examinership process in Ireland and the reconstruction process in Norway that were initiated in the fourth quarter are on track.

The pandemic continues to have a negative impact on the aviation industry. Demand was severely affected by changing travel restrictions and the continued spread of COVID-19 across Norwegian’s key markets. Out of a current fleet of 131 aircraft, an average of 15 were operational during the fourth quarter, mainly on domestic routes in Norway. Norwegian carried 574,000 customers, a decrease of 92 percent compared to the same period in 2019. Production capacity (ASK) was down 96 percent and passenger traffic (RPK) decreased by 97 percent. The load factor was 52.4 percent, a decrease of 32.5 percentage points compared to the fourth quarter of 2019.

Jacob Schram, CEO of Norwegian, said: “2020 was an exceptionally difficult year for the aviation industry and for Norwegian. Consequently, the fourth quarter results are as expected. Unfortunately, many of our employees are furloughed or have lost their jobs, partly due to the company’s decision to cease long-haul operations. Despite the difficulties the pandemic has caused, there is a great fighting spirit and engagement within the company, and together we will build new Norwegian when we exit the reconstruction processes. Now, we are doing everything we can to emerge as a more financially secure and competitive airline with an improved customer offering, and as soon as Europe begins to reopen, we will be ready to welcome more customers on board.”

In the fourth quarter of 2020, Norwegian entered an examinership process in Ireland and a reconstruction process in Norway. Both processes are progressing as planned and are on track. The purpose of the processes is to reduce debt, reduce the size of the fleet and make the company financially attractive to secure new capital. Norwegian targets to reduce its debt significantly to around NOK 20 billion and to raise NOK 4 – 5 billion in new capital. In 2020, the company reduced net interest-bearing debt by NOK 18 billon, mainly through conversion to equity. Going forward, Norwegian will focus on a strong and profitable Nordic and European network. The company plans to serve these markets with approximately 50 narrow body aircraft in 2021. However, the ramp-up is dependent on the development of the pandemic, travel restrictions and government advice in key markets.

Norwegian operated 90.1 percent of its scheduled flights in the fourth quarter, whereof 94.1 percent departed on time.

Norwegian aircraft photo gallery:

Norwegian aircraft slide show:

COVID-19 heavily influences Norwegian’s January traffic figures

Norwegian Air’s traffic figures for January are heavily influenced by lower demand caused by continued travel restrictions across Europe.

In January, 74,224 customers flew with Norwegian, a decrease of 96 percent compared to the same period last year. The capacity (ASK) was down 98 percent, and the total passenger traffic (RPK) was down by 99 percent. The load factor was 35.9 percent, down 45 percentage points.

Jacob Schram, CEO of Norwegian, said: “The pandemic continues to have a negative impact on our business as travel restrictions remain. We are doing everything in our power to come out of the examinership as a stronger, more competitive airline and we look forward to welcoming more customers on board as travel restrictions are lifted.”

Norwegian operated eight aircraft on average in January, mainly on domestic routes in Norway. The company operated 96.8 percent of its scheduled flights in January, whereof 90.4 percent departed on time.

Norwegian appreciates support from the Norwegian Government

Norwegian is pleased to announce that the government of Norway has decided to support and contribute to the airline’s funding of new capital, pending certain conditions. This move significantly increases Norwegian’s chances of working through the crisis caused by the pandemic and to position itself as a key player within Norwegian and European aviation.

“On behalf of everyone at Norwegian, I would like to sincerely thank the government for their support. Norwegian has been faced with a very challenging and demanding situation due to the pandemic, and the government’s support significantly increases our chances of raising new capital and getting us through the reconstruction process we are currently in. We still have a lot of work ahead of us, but a participation from the government underscores that we are heading in the right direction,” said Norwegian CEO, Jacob Schram.

Norwegian entered into an Irish examinership process and a supplementary reconstruction negotiation in Norway late last year. On January 14, 2021, the airline presented a new business plan (LINK) based on a simplified business structure with a focus on a European route network and discontinuing its long-haul operations, as well as significantly reducing its debt. The plan comprises a fleet of around 50 aircraft in operation this year, and to gradually increase to approximately 70 aircraft in 2022, pending demand and potential travel restrictions. The debt will be reduced to around NOK 20 billion, and the company will raise four to five billion NOK in new capital.

“With a new business plan, and a participation from the government, we are confident we can attract investors and get through the Examinership and reconstruction process. We have received extensive support from political parties, customers, colleagues, shareholders, and business partners, for which we are extremely grateful, especially during these challenging times. Furthermore, the government’s support will contribute to help securing jobs and maintain healthy competition within the aviation sector,” added Schram.

Norwegian closes its long-haul network, Gatwick jobs at stake, will focus on Europe and 737s

Norwegian has made a major decision to shut down its long-haul Boeing 787 Dreamliner network and concentrate on short-haul operations from Europe with this announcement:

Norwegian’s Board of Directors has outlined a simplified business structure and dedicated short haul route network. With this plan, Norwegian can build a robust and solid company that will attract investors and continue to serve new and existing customers.

Norwegian has long been recognized as an industry leader in low cost travel, winning numerous awards. The company will build on this foundation, focusing on its core Nordics business, operating a European short haul network with narrow body aircraft. The airline will continue to meet its customers’ needs by offering competitive fares across a broad range of domestic routes in Norway, across the Nordics and to key European destinations.

“Our short haul network has always been the backbone of Norwegian and will form the basis of a future resilient business model,” said Jacob Schram, CEO of Norwegian.

The current plan is to serve these markets with around 50 narrow body aircraft in operation in 2021 and to increase that number to around 70 narrow body aircraft in 2022. Furthermore, Norwegian targets to reduce its debt significantly to around NOK 20 billion and to raise NOK 4 – 5 billion in new capital through a combination of a rights issue to current shareholders, a private placement and a hybrid instrument. The company has received concrete interest in participation in the private placement. Norwegian has recently reinitiated a dialogue with the Norwegian government about possible state participation based on the new business plan.

The COVID-19 pandemic has profoundly affected the entire aviation industry. Travel restrictions and changing government advice continue to negatively influence demand for long haul travel, and Norwegian’s entire Boeing 787 Dreamliner fleet has been grounded since March 2020. Future demand remains highly uncertain. Under these circumstances a long haul operation is not viable for Norwegian and these operations will not continue. The consequence of this decision is that the board of directors of the legal entities employing primarily long haul staff in Italy, France, the UK and the US have contacted insolvency practitioners. Norwegian will continue to assess profitable opportunities as the world adapts and recovers from the impact of COVID-19.

Customers with bookings affected by the future changes in our route network will be contacted directly and will be refunded. The examinership and reconstruction processes undertaken in Ireland and Norway will continue as planned, and the plan presented today is subject to approval by the Examiner and Reconstructor, support from the creditors and subsequently court approval.

Norwegian Air Shuttle aircraft photo gallery:

Norwegian Air Shuttle aircraft slide show:

Norwegian’s December traffic figures were heavily impacted by COVID-19, down 94%

Norwegian Air Shuttle issued this report:

In December, 129,664 customers flew with Norwegian, a decrease of 94 percent compared to the same period last year. The capacity (ASK) and total passenger traffic (RPK) were both down by 98 percent. The load factor was 52.3 percent, down 31 percentage points.

Jacob Schram, CEO of Norwegian, said: “The pandemic continues to have a negative impact on our business as it has had since March 2020. At the beginning of last year, Norwegian was headed for a positive result in 2020, instead 2020 has been a very challenging year and we now find ourselves fighting for survival. Despite low demand in December, Christmas bookings were positive, and we have succeeded in adapting our operations to the current situation. Our goal is to be a financially strong and competitive airline, with a new financial structure, a rightsized fleet and improved customer offering.”

“The support from our customers, employees and suppliers this past year has been extraordinary. We all wish to travel and meet our friends and loved ones again and at Norwegian our focus continues to be to connect people in a safe and comfortable way. The vaccination is now being rolled out across the world and is good news for both the aviation industry and those who want to travel. We will be ready to meet the competition for customers after the COVID-19 pandemic. 2020 has been a tough year, but we will continue to fight and come out of this crisis as a stronger Norwegian,” Schram said.

Norwegian operated nine aircraft on average in December, mainly on domestic routes in Norway. The company operated 95.6 percent of its scheduled flights in December, whereof 88.5 percent departed on time.

Norwegian Air Shuttle initiates a reorganization process in Norway

Norwegian on December 8, 2020 filed for a reconstruction under Norwegian law. This process will coexist with the Irish Examinership process.

Following Norwegian being made subject to the examinership process in Ireland on December 7, 2020 the company now wants to enter into a supplementary Norwegian reconstruction process. This was announced in a notice to the Stock Exchange.

“A supplementary reconstruction process under Norwegian law will be to the benefit of all parties and will increase the likelihood of a successful result. Our aim is to secure jobs in the company and to contribute to securing critical infrastructure and value creation in Norway,” said Norwegian CEO, Jacob Schram.

“We will now concentrate on working towards our goal of reducing company debt, reducing the size of our aircraft fleet, and ensuring that we are a company that investors will find attractive. We will be ready to meet the competition for customers after the COVID-19 pandemic,” said Schram.

Norwegian filed for the Irish Examinership on November 18, 2020. The processes will not have an impact on the current business. The Company will continue to operate its route network. Both its bonds and shares will continue to trade as normal on the Oslo Stock Exchange. As earlier stated, Norwegian Reward will continue as normal honoring and earning CashPoints for its members.

Norwegian Air Shuttle aircraft photo gallery:

Norwegian Air Shuttle aircraft slide show:

Norwegian’s passenger traffic was down 95% in November

Norwegian Air Shuttle has issued this traffic report:

Norwegian’s traffic figures for November are strongly affected by lower demand due to travel restrictions in Europe. The bookings for Christmas look positive.

In November, 124,481 customers flew with Norwegian, 95 percent fewer than the same month last year. Total capacity (ASK) decreased by 96 percent while passenger traffic (RPK) decreased by 98 percent. The cabin factor was 44.4 percent, a decrease of 39 percentage points.

The pandemic continues to have a negative impact on our business. With travel restrictions throughout Europe, demand will be very low. The fact that vaccines are coming soon is good news for the aviation industry and we will compete for customers when it becomes possible to travel again. Our goal is now to create a financially strong and competitive airline with a new financial structure, an adapted size of the aircraft fleet and an improved range for our customers, says CEO Jacob Schram.

62 extra departures in Norway – Tickets for next summer are now available and it looks positive with the bookings. It is clear that people have started thinking about the summer holidays. It is also worth noting that the bookings for Christmas are good and we have set up 62 extra departures in Norway. We look forward to flying our customers home for Christmas, Schram continues. In total, Norwegian completed 72.7 percent of the planned flights in November, of which 94.8 percent went according to schedule.

"Joan Miro, Spanish Artist"

Above Copyright Photo: Norwegian.com (Norwegian Air UK) Boeing 787-9 Dreamliner G-CKOF (msn 38786) (Joan Miro, Spanish Artist) JFK (Fred Freketic). Image: 952173.