Category Archives: Scandinavian Airlines-SAS

SAS’ total number of passengers was down 74% in August

Scandinavian Airlines-SAS issued this report:

Total number of passengers and capacity in August decreased by 74% and 73% respectively, versus the same period last year. However, August also recorded a small increase of 12 000 passengers compared to July this year.

SAS’ traffic continues to be negatively impacted by COVID-19. In August, total capacity was down by 73.4% compared to the same period last year and number of passengers decreased by 2.1 million. Demand has recovered somewhat better within Scandinavia than in other parts of our network and SAS has deployed its capacity accordingly.

“During fall we aim to increase the number of flights and re-open more routes, in line with the re-bounce in demand. Primarily we’ll resume domestic traffic in Denmark, Norway and Sweden, but also re-open 18 routes to key European destinations. Furthermore, we aim to resume flights to Asia and once again offer flights across all three continents where we normally operate,” says Rickard Gustafson, CEO SAS.

SAS will continue to increase the number of flights and open routes to more destinations in Europe, USA and Asia

Scandinavian Airlines-SAS has made this announcement:

Throughout autumn, SAS will continue to increase the number of flights and open routes to more destinations in Europe, USA and Asia to meet the demand for travel and transport to, from and within Scandinavia.

SAS’ domestic flights in Sweden, Norway and Denmark will cover almost the entire domestic network when SAS resumes its flights from Stavanger to Trondheim and from Stockholm to Ronneby and Sundsvall. With its expanded flight programme, within and between the three countries, SAS will increase the availability of essential travel and transport, thereby ensuring critical infrastructure.

To meet the demand also for business travel to Europe, SAS is increasing the number of flights and adding 18 routes to key European markets and capitals, such as from Copenhagen to Paris, from Stockholm to Frankfurt and from Oslo to Brussels.

At the end of September, SAS plans* to start up its intercontinental flights to Asia and fly from Copenhagen to Shanghai once a week.

This means that SAS will be able to offer flights again in the autumn across the whole network on all three continents on which SAS operates.

SAS is also increasing the number of flights to New York from Copenhagen up to daily departures. We will also resume flights from Copenhagen to Washington, with two flights a week from mid-September and maintain an unchanged number of flights to Chicago and San Francisco.

As there is still uncertainty regarding restrictions and there are changes in travel advice, SAS offers travelers the option to change a planned journey/ticket for a SAS Travel Voucher, up to 16 days prior to departure, for all international travel, until January 15.

*Subject to government approval.

SAS reports continued negative impact of COVID-19

Scandinavian Airlines-SAS issued this report for the last quarter:

MAY 2020–JULY 2020

  • Revenue: MSEK 2,507 (13,401)
  • Income before tax (EBT): MSEK -2,071 (1,490)
  • Income before tax and items affecting comparability: MSEK -784 (1,495)
  • Net income for the period: MSEK -2,365 (1,162)
  • Earnings per common share: SEK -6.18 (3.04)

SIGNIFICANT EVENTS DURING THE QUARTER

  • SAS signs a SEK 3.3bn revolving credit facility agreement
  • SAS presents a revised business plan including measures to tackle the effects of the COVID-19 pandemic and revised sustainability goals
  • SAS presents a recapitalization plan to remedy the liquidity shortage and the negative equity caused by the COVID-19 outbreak

SIGNIFICANT EVENTS AFTER QUARTER END

  • SAS presents a revised recapitalization plan supported by shareholders representing 35.6% of shares and the noteholders committee. The plan is also approved by the European Commission

NOVEMBER 2019–JULY 2020

  • Revenue: MSEK 17,478 (32,677)
  • Income before tax (EBT): MSEK -6,880 (-302)
  • Income before tax and items affecting comparability: MSEK -5,576 (-440)
  • Net income for the period: MSEK -6,696 (-240)
  • Earnings per common share: SEK -17.66 (-0.65)

CONTINUED NEGATIVE IMPACT OF COVID-19

We are encouraged to see that demand is slowly returning as we continue to ramp-up our operations. So far, the demand for air travel has developed in line with our expectations, with domestic traffic leading the way. Simultaneously we are making good progress in adapting our cost structure to a market defined by lower demand. Although there are significant challenges ahead, I am confident that SAS will return as a sustainable and profitable airline following a successful implementation of the recapitalization plan. Aviation fulfils a vital part of Scandinavia’s infrastructure, and is important to enable connectivity to the rest of the world as demand returns.

FINANCIAL SUMMARY

The coronavirus and travelling restrictions has led to a collapse in the demand for air travel. Consequently, the number of passengers traveling with SAS dropped 86% and total revenue decreased 81% in the quarter. Domestic travel has rebounded more quickly than other parts of our business and accounts for most of our quarterly revenue.

Despite our immediate measures to reduce costs to adapt to a new reality, the cost reduction of 67% did not offset the sharp decline in revenue. As a result, earnings before tax came in at SEK -2.1 billion, some SEK 3.6 billion below last year. The result was positively impacted by SEK 840 million from a strengthening of the Swedish krona, primarily against the US dollar. However, in line with other airlines, the negative development in aircraft valuations necessitated a SEK 1,040 million write down of some aircraft assets.

Our focus on preserving cash is evident through a monthly operating cash burn of SEK 320 million. This is of course significantly worse than last year but below the range we presented in the second quarter, and we will continue to monitor cash burn as we slowly continue to ramp-up operations. At the end of the third quarter our cash position was SEK 6.2 billion, which includes the SEK 3.3 billion drawn under the credit facility guaranteed by the Danish and Swedish states.

CUSTOMER DEMAND SLOWLY INCREASING

Demand continues to return slowly and in line with the estimated ramp-up plan we presented in the second quarter. In the quarter, demand was centered around domestic travel and attractive European summer destinations. In July, SAS operated 8,700 departures representing some 25% of prior year available seat kilometers. This is an increase of some 20 percentage points compared to the first month of this quarter. During the fourth quarter, we will continue to ramp-up production and we expect to reach 30% -40% of prior year available seat kilometers by the end of Q4.

Despite the slow but ongoing recovery as noted in our traffic figures, demand going forward remains uncertain and is heavily dependent on the easing of travel restrictions as well as passenger confidence and willingness to travel. Furthermore, it is difficult to predict how demand will evolve during the coming fall and winter due to changed customer behavior with bookings being made closer to the date of travel. Our current expectation is that the ramp-up phase for the airline industry may last until 2022 before demand can reach more normalized levels, with a return to pre COVID-19 levels a few years thereafter.

PROGRESS ON REVISED BUSINESS PLAN

SAS continues to make progress with its revised business plan, which is based on four building blocks: To be the preferred airline for Scandinavia’s frequent travelers; to transition to a hyper modern single-type fleet; to establish a fully competitive operating model, and; to achieve global leadership in sustainable aviation. During the quarter several milestones were reached.

Almost 4,000 redundancies (of approximately 5,000 in total) have now been concluded and local employment agreements are being renegotiated. In July, we signed an agreement to outsource ground handling operations in both Gothenburg and Malmö, concentrating our operations to the three main hubs in Copenhagen, Oslo and Stockholm. Even though the initiatives regarding our work force are difficult and unfortunate, these measures are unavoidable and necessary to safeguard SAS for the future.

Through constructive dialogue with Airbus, we have managed to defer 8 A320neo and 2 A350-900 aircraft deliveries. These deferrals are important as they reduce our capital expenditures for 2021–2024 and better align deliveries of new aircraft with the expected return in demand. We are still committed to achieving a single-type fleet operation by 2023, based on new Airbus aircraft that will provide lower fuel consumption and reduced maintenance costs compared with our current fleet composition. Furthermore, we have made progress on our ambitious sustainability goals by accelerating the phase out of older and less fuel-efficient aircraft. We have also renegotiated agreements with several suppliers, including wet-lease providers. The new agreements will lead to lower costs and increased flexibility, through a higher share of variable costs going forward.

We have introduced new procedures to ensure that our customers experience the safest travel experience possible and continue to provide an attractive timetable for travelers to, from and within Scandinavia. At the same time, we regret that many customers are still waiting for refunds from canceled flights. I would like to emphasize that our customers that are entitled to refunds will be refunded, and we have increased our capacity to handle the large number of cancellations in these unprecedented circumstances.

PROGRESS ON RECAPITALIZATION PLAN 

Despite our own efforts, the COVID-19 pandemic has resulted in a need to remedy the liquidity situation and the negative equity caused by the outbreak. During the quarter SAS reached an agreement in principle with the noteholders committee representing a large proportion of the holders of SAS bonds and hybrid notes. Furthermore, the governments of Denmark and Sweden have now approved the revised recapitalization plan, which has also been approved by the European Commission under applicable State aid rules framework.

The next steps of the plan are to obtain a vote in favor of the offer from the bond and hybrid holders at the noteholders meeting on September 2, and a vote in favor of the recapitalization plan at the extraordinary shareholders’ meeting scheduled for September 22. The entire revised Recapitalization plan is expected to be completed early November.

SAS plays a vital role in connecting the Scandinavian countries to the rest of the world, as well as being an important infrastructure provider within the region. By focusing on rebuilding our domestic and intra-Scandinavian presence, we have been able to increase capacity ahead of competition. I am grateful that our major shareholders have decided to support SAS and trust that others will do the same in these unprecedented times.  SAS is determined to continue as Scandinavia’s leading airline as the world recovers from the COVID-19 pandemic.

On behalf of all of us at SAS, I’m looking forward to once again welcoming you onboard on one of our flights soon!

Rickard Gustafson,

President and CEO

Stockholm, 25 August 2020

SAS’ traffic was down by 76% in July

Scandinavian Airlines-SAS has released its traffic figures for July 2020:

SAS Traffic figures – July 2020

SAS capacity was down by 76% and total number of passengers were 75% lower compared to same period last year. Number of passengers remains low due to limited demand in the light of the ongoing COVID-19 pandemic.

SAS continues to resume flights to its destinations as demand returns and travel restrictions are easing. Compared to June, the number of passengers increased by nearly 300 thousand but showed a decrease of 2.5 million compared to same period last year. Domestic routes are showing the strongest recovery, whereas demand for Intercontinental and European travel remains weak.

“We continue to note a slow recovery of demand, in line with our expectations. As demand slowly returns, we are pleased to gradually ramp up our operations while ensuring a safe travel experience for our customers and employees,” says Rickard Gustafson, CEO SAS.

SAS scheduled traffic Jul20 Change1 Nov19-Jul20 Change1
ASK (Mill.) 1 308 -73.5% 18 575 -47.2%
RPK (Mill.) 662 -83.9% 11 746 -54.1%
Passenger load factor 50.6% -32.6 p u 63.2% -9.6 p u
No. of passengers (000) 699 -73.0% 10,429 -48.8%
Geographical development, schedule Jul20            vs.           Jul19 Nov19-Jul20     vs.    Nov18-Jul19
RPK ASK RPK ASK
Intercontinental -97.4% -87.1% -58.6% -50.6%
Europe/Intrascandinavia -84.7% -77.0% -56.3% -50.9%
Domestic -39.0% -16.0% -37.7% -29.7%
SAS charter traffic Jul20 Change1 Nov19-Jul20 Change1
ASK (Mill.) 18 -97.4% 867 -66.5%
RPK (Mill.) 14 -97.8% 754 -68.0%
Load factor 81.9% -12.5 p u 87.0% -3.9 p u
No. of passengers (000) 6 -97.7% 248 -71.0%
SAS total traffic (scheduled and charter) Jul20 Change1 Nov19-Jul20 Change1
ASK (Mill.) 1 326 -76.4% 19 442 -48.5%
RPK (Mill.) 676 -85.8% 12 500 -55.3%
Load factor 51.0% -33.6 p u 64.3% -9.8 p u
No. of passengers (000) 705 -75.2% 10,676 -49.7%

1 Change compared to same period last year. p u = percentage units

Preliminary yield and PASK Jul20 Nominal change FX adjusted change
Yield, SEK 1.10 27.6% 32.3%
PASK, SEK 0.56 -22.5% -19,6%
Jul20
Punctuality (arrival 15 min) 95.7%
Regularity 99.4%
Change in total CO2 emissions, rolling 12 months -36.1%
Change in CO2 emissions per available seat kilometer -3.5%
Carbon offsetting of passenger related emissions 39%

Definitions:

RPK – Revenue passenger kilometers
ASK – Available seat kilometers
Load factor – RPK/ASK
Yield – Passenger revenues/RPK (scheduled)
PASK – Passenger revenues/ASK (scheduled)
Change in CO2 emissions per available seat kilometers – SAS passenger related carbon emissions divided with total available seat kilometers (incl. non-revenue and EuroBonus), rolling 12 months
Carbon offsetting of passenger related emissions – Share of SAS passenger related carbon emissions compensated by SAS (EuroBonus members, youth tickets and SAS’ staff travel)
From fiscal year 2020 we report change in CO2 emissions in total and per Available Seat Kilometers (ASK) to align with our overall goal to reduce our total CO2 emissions by 25% by 2025, compared to 2005.

SAS’ traffic dropped 86% in June, active fleet increases to 45 aircraft

Scandinavian Airlines-SAS released its traffic figures for June 2020.

As a result of the ongoing COVID-19 pandemic the total number of passengers was 86% lower compared to last year. From mid-June, SAS doubled its capacity to 30 aircraft and an additional 15 aircraft have returned to service in July.

SAS has increased its capacity and number of passengers as countries are gradually opening up. Compared to last month capacity has increased by 251 million available seat kilometers (ASK) and the number of passengers has increased by 269 thousand. In relation to last year SAS experienced a 91% reduction in capacity and an 86% drop in the total number of passengers.

“We are pleased to welcome more passengers onboard as we slowly start to rebuild our network and increase the connectivity to, from and within Scandinavia,” says Rickard Gustafson, CEO SAS.

SAS scheduled traffic Jun20 Change1 Nov19-Jun20 Change1
ASK (Mill.) 426 -90.1% 17 266 -42.9%
RPK (Mill.) 223 -93.6% 11 084 -48.4%
Passenger load factor 52.4% -29.1 p u 64.2% -6.9 p u
No. of passengers (000) 328 -88.1% 9,729 -45.3%
Geographical development, schedule Jun20            vs.           Jun19 Nov19-Jun20     vs.    Nov18-Jun19
RPK ASK RPK ASK
Intercontinental -99.1% -97.2% -52.3% -45.4%
Europe/Intrascandinavia -96.3% -93.5% -49.4% -45.6%
Domestic -72.1% -64.6% -37.6% -31.1%
SAS charter traffic Jun20 Change1 Nov19-Jun20 Change1
ASK (Mill.) 2 -99.7% 850 -55.4%
RPK (Mill.) 1 -99.9% 740 -56.7%
Load factor 35.3% -55.3 p u 87.1% -2.6 p u
No. of passengers (000) 99 -100% 242 -59.8%
SAS total traffic (scheduled and charter) Jun20 Change1 Nov19-Jun20 Change1
ASK (Mill.) 427 -91.2% 18 116 -43.6%
RPK (Mill.) 223 -94.4% 11 824 -49.1%
Load factor 52.3% -30.3 p u 65.3% -6.9 p u
No. of passengers (000) 427 -85.5% 9,971 -45.7%

1 Change compared to same period last year. p u = percentage units

Preliminary yield and PASK Jun20 Nominal change FX adjusted change
Yield, SEK 1.92 76.3% 82.8%
PASK, SEK 1.01 13.2% 17.4%
Jun20
Punctuality (arrival 15 min) 95.8%
Regularity 99.7%
Change in total CO2 emissions, rolling 12 months -28.1%
Change in CO2 emissions per available seat kilometer -3,2%
Carbon offsetting of passenger related emissions 42%

Definitions:
RPK – Revenue passenger kilometers
ASK – Available seat kilometers
Load factor – RPK/ASK
Yield – Passenger revenues/RPK (scheduled)
PASK – Passenger revenues/ASK (scheduled)
Change in CO2 emissions per available seat kilometers – SAS passenger related carbon emissions divided with total available seat kilometers (incl. non-revenue and EuroBonus), rolling 12 months
Carbon offsetting of passenger related emissions – Share of SAS passenger related carbon emissions compensated by SAS (EuroBonus members, youth tickets and SAS’ staff travel)
From fiscal year 2020 we report change in CO2 emissions in total and per Available Seat Kilometers (ASK) to align with our overall goal to reduce our total CO2 emissions by 25% by 2025, compared to 2005.

SAS aircraft photo gallery:

Denmark and Sweden save SAS with a rescue package

Denmark and Sweden are extending a life line of 9 billion kroner ($929 million) as part of a rescue package to save Scandinavian Airlines (SAS) from bankruptcy following the airline’s extensive losses due to COVID-19.

As a result, Denmark (14.2%) and Sweden (14.8%) are increasing their shares in the flag carrier.

Meanwhile layoffs continue with 1,900 jobs lost in Sweden, 1,300 in Norway and almost 1,600 in Denmark.

SAS aircraft photo gallery:

SAS routes that are resuming in July, fleet to increase to over 40 active aircraft

Scandinavian Airlines-SAS has made this announcement:

SAS is now launching its schedule for July. In total, the new traffic program will see capacity increased from 30 aircraft in June to over 40 in July, equivalent to just under 30 percent compared with the corresponding period last year.

As demand slowly but surely increases, SAS is resuming flights to many destinations from Copenhagen, Oslo and Stockholm. In addition to a number of routes from Copenhagen, SAS is also resuming international flights from Oslo to a number of destinations, including Reykjavík, and continuing its operations to Finland and London from Stockholm.

Further destinations will gradually be added from all three countries as demand returns.

“As restrictions and inbound travel rules are relaxed, we are seeing a rise in demand for travel. However, it remains just as important that travellers keep themselves informed of the rules that apply to each country and destination at all times, and that people stay at home if they are experiencing any symptoms. We would also like to remind you of the measures that SAS has implemented in order to reduce the risk of infection spreading and the changes that these measures entail for your journey, e.g. the requirement to wear a face mask during flights,” says Freja Annamatz, Head of Media Relations.

In July, SAS will fly to the following destinations:

From Copenhagen:

•                    Aalborg

•                    Aarhus

•                    Faeroes

•                    Malaga

•                    Palma de Mallorca

•                    Alicante

•                    Athens

•                    Nice

•                    Split

•                    London

•                    Berlin

•                    Dusseldorf

•                    Frankfurt

•                    Hamburg

•                    Munich

•                    Stuttgart

•                    Amsterdam

•                    Bologna

•                    Rome

•                    Milan

•                    Brussels

•                    Faro

•                    Gdańsk

•                    Geneva

•                    Zurich

•                    Reykjavík

•                    Palanga

•                    Vilnius

•                    Arlanda

•                    Oslo

•                    Stavanger

•                    Bergen

•                    Trondheim

•                    New York

•                    Chicago

•                    San Francisco

From Oslo:

•                    Alta

•                    Bardufoss

•                    Bodø

•                    Evenes

•                    Kirkenes

•                    Longyearbyen

•                    Tromsø

•                    Lakselv

•                    Ålesund

•                    Bergen

•                    Haugesund

•                    Kristiansand

•                    Kristiansund

•                    Molde

•                    Stavanger

•                    Trondheim

•                    Athens

•                    Malaga

•                    Alicante

•                    Palma de Mallorca

•                    Split

•                    Barcelona

•                    Billund

•                    Gran Canaria

•                    Nice

•                    Aalborg

•                    Aarhus

•                    Stockholm

•                    Copenhagen

•                    Reykjavík

Stavanger to  Aberdeen
From Stockholm

•                    Ängelholm

•                    Gothenburg

•                    Kalmar

•                    Kiruna

•                    Luleå

•                    Malmö

•                    Östersund

•                    Skellefteå

•                    Umeå

•                    Visby

•                    Malaga

•                    Alicante

•                    Palma de Mallorca

•                    Aten

•                    Thessaloniki

•                    London

•                    Rome

•                    Milan

•                    Faro

•                    Split

•                    Helsinki

•                    Oslo

•                    Copenhagen

SAS’ traffic fell by 94%, will expand its operational fleet to 30 aircraft during June

Scandinavian Airlines-SAS made this announcement:

The total number of passengers fell by nearly 94% compared to last year as a result of the ongoing COVID-19 pandemic. During June, SAS will double its capacity to 30 aircraft as travel restrictions are being eased.

“May was the second consecutive month with most of our fleet being grounded as a result of the COVID19 pandemic and imposed travel restrictions. The negative impact is reflected in our total traffic figures, showing a 96% capacity reduction and a 94% drop in number of passengers compared to last year.

Countries are gradually opening up and we expect that demand will start to re-build slowly from the current low levels. In June, we have started to ramp-up production from 15 aircraft in service to 30, mainly serving domestic and Nordic destinations.

We look forward to re-building our network as travel restrictions are lifted and once again having the pleasure of welcoming our passengers onboard,” says Rickard Gustafson, CEO SAS.

In other news, SAS made this announcement:

The world is slowly reopening – and so are our routes.

Last week, we announced that we will slowly start reopening some routes. Now it’s time to put a name on the destinations: Brussels, Düsseldorf, the Faroe Islands, Frankfurt, Hamburg, Malaga, Milan, Munich, Nice, Palanga, Reykjavik, Split, Stuttgart, Thessaloniki and Vilnius.

Some destinations are not available from all three Scandinavian countries.

SAS aircraft photo gallery:

COVID-19 is having a negative impact at SAS

All 4 parked in March 2020, future uncertain

Scandinavian Airlines-SAS has reported on its financial performance in the latest quarter:

SIGNIFICANT NEGATIVE RESULTS DUE TO COVID-19

FEBRUARY 2020–APRIL 2020

  • Revenue: MSEK 5,264 (9,871)
  • Income before tax (EBT): MSEK -3,722 (-1,216)
  • Income before tax and items affecting comparability:MSEK -3,714 (-1,211)
  • Net income for the period: MSEK -3,470 (-933)
  • Earnings per common share: SEK -9.15 (-2.44)

SIGNIFICANT EVENTS DURING THE QUARTER

  • SAS temporarily halts most of its traffic due to effects of COVID-19
  • SAS initiates processes to reduce future workforce by up to 5,000 full-time positions
  • Ongoing and constructive discussions with largest owners on a recapitalization plan to secure adequate levels of funding and equity for the future

SIGNIFICANT EVENTS AFTER QUARTER END

  • SAS signs a SEK 3.3bn revolving credit facility agreement
  • Magnus Örnberg appointed new CFO of SAS

NOVEMBER 2019–APRIL 2020

  • Revenue: MSEK 14,971 (19,276)
  • Income before tax (EBT): MSEK -4,809 (-1,792)
  • Income before tax and items affecting comparability: MSEK -4,792 (-1,935)
  • Net income for the period: MSEK -4,331 (-1,402)
  • Earnings per common share: SEK -11.49 (-3.69)

SIGNIFICANT NEGATIVE FINANCIAL RESULTS DUE TO COVID-19

The COVID-19 pandemic has created a global crisis for the aviation industry, including SAS. What started with travel restrictions to mainland China quickly led to global travel restrictions, quarantines and strict advice against unnecessary travel. Effectively, these measures eliminated the core foundation for our business model, and almost our entire fleet was grounded from mid-March. At the end of the quarter, SAS primarily operated limited domestic networks in Norway and Sweden, supplemented with a few international repatriation flights. For the first time in the history of our company, SAS offered no scheduled international flights to/from Scandinavia.

FINANCIAL SUMMARY

We started our fiscal year with high demand for our services and with a robust operational performance in terms of regularity and punctuality. We reported strong passenger numbers, increased revenue and improved market shares. However, as the second quarter progressed, the full effects of the COVID-19 pandemic became evident. In April, our capacity was down 94% and the number of passengers fell 96% compared to last year. As a direct consequence, our quarterly revenue fell nearly 50% to MSEK 5,264.

The decline in demand immediately triggered SAS to implement a broad range of measures to radically reduce costs. In total, these reductions of fixed and variable cost amounted to SEK 2.4 billion compared to the same quarter last year. As of today, approximately 90% of our workforce is on temporary layoff schemes and we have announced a permanent reduction of 5,000 positions to adapt to predicted market conditions. Moreover, we have enforced a significant reduction of our network, reduced our sales & marketing spend, renegotiated supplier agreements, and postponed IT projects and investments. We also reduced capital expenditures by deferring aircraft deliveries and reaching agreements on payment holidays with most of our lessors.

SAS, like many other airlines has a very high level of fixed costs, whereby the cost reductions have not fully offset the sharp revenue decline, as a result of which we ended the quarter with a pre-tax loss of SEK 3.7 billion. Another focus area has been to preserve cash to the extent possible, and our cash position ended at SEK 4.2 billion, down SEK 2.4 billion in the quarter.

Shortly after the quarter ended, we were able to secure a three-year SEK 3.3 billion revolving credit facility, 90% guaranteed by the Danish and Swedish states. The facility strengthens our financial situation in a difficult period, with an expected negative operating cash burn in the range of MSEK 500–700 per month until end of fiscal year 2020.

COMMUNITY SUPPORT AND SAFE TRAVEL

Despite closed borders, SAS continues to play a vital role in supporting overall society. Early on during the outbreak, SAS operated special flights to repatriate Scandinavian citizens from countries such as Peru, Brazil and Pakistan. We have ensured air bridges for essential medical supplies in close collaboration with the three Scandinavian governments and the Knut and Alice Wallenberg foundation.

Furthermore, our committed employees have engaged in relieving the very strained healthcare sector, assisting in carrying out public COVID-19 tests and volunteering as substitute teachers in elementary schools.

The safety and well-being of travelers and employees is always our highest priority. Therefore, SAS has reviewed the entire customer journey, and imposed some changes to ensure the safest travel experience possible. As a starting point, we urge all travelers to follow the general recommendations set by the health authorities in the respective countries.

Our boarding procedures have been adapted to facilitate social distancing and we have temporarily closed all SAS Lounges. Onboard, our aircraft are equipped with effective HEPA filters that significantly reduce the risk of airborne contamination, our service concept has been re-designed to reduce physical contact and all aircraft are cleaned and disinfected on a more frequent basis. Moreover, passengers will be seated with as much personal space possible, non-essential loose items onboard have been removed and hand luggage allowance is limited. Passengers are required to bring and use protective face masks during travel.

TRANSFORMATION TO ADAPT TO A NEW REALITY

Countries will gradually re-open, but the pace and prerequisites will not be the same in all geographies and regions. Furthermore, the pandemic has led to an economic downturn, resulted in behavioral changes in favor of more digital meetings and caused a general health concern among many customers. Therefore, we expect a longer recovery period than experienced in previous downturns. We expect that the recovery will start with increased domestic demand followed by European and then Intercontinental destinations. But, it will most likely take until 2022 before we see demand in line with what we experienced before the COVID-19 outbreak.

With the ongoing crisis, SAS will once again need to demonstrate its ability to transform to meet a new and very challenging reality. As a response to an environment characterized by lower passenger numbers and revenue generation, SAS is pursuing a revised business plan generating SEK 4 billion in further improvements by 2022.

The savings will come from a broad range of measures. A reduction of the workforce by up to 5,000 positions, combined with a zero-based resizing of our administration. Productivity improvements in the range of 15-25% are required in all collective bargaining agreements to cater for changing market conditions and seasonality aspects. Continuation of strict cost control procedures, imposed during the crisis, including renegotiated contracts with suppliers, reduced spend on marketing, product, IT development and other projects. Additionally, we plan to adapt the fleet size, through postponements and adjusted future deliveries of aircraft from Airbus and lessors until demand returns.

Our commitment to a more sustainable future remains firm, and the plan includes additional initiatives to maintain and accelerate our efforts. To achieve this, SAS will continue to upgrade its fleet, rightsize aircraft usage to demand and increase usage of sustainable aviation fuels to significantly reduce our emissions.

Given the impact of COVID-19 and the time it will take to recover to a more normalized situation, SAS will need to secure further funding in order to continue as the most important airline infrastructure provider in Scandinavia. This will require support from the Scandinavian governments. As a first step the Danish and Swedish governments have provided 90% guarantees for the SEK 3.3 billion revolving credit facility. SAS also continues its efforts to secure support from the Norwegian government.

SAS is currently in active, intensive and constructive discussions with the company’s major shareholders and selected stakeholders on a recapitalization plan to ensure the future of SAS. This includes realization of its key business priorities of necessary increased productivity and a continuation of the green transition.

Any potential solution will require both government and market participation, as well as burden sharing measures involving internal, external and financial stakeholders in the company. Different options are currently being considered, and we aim to present a plan to the market in June 2020.

Once a plan is in place, I am confident that we can overcome the current challenges and start to rebuild our business based on the strengths of SAS, including committed and dedicated employees, a strong brand and a valued customer offering.

We’re experiencing an unprecedented situation at the moment, that creates significant challenges for SAS. I would like to express my sincere appreciation to all SAS employees for their dedicated efforts and support during the crisis. SAS is determined to re-start operations as soon as possible. On behalf of all of our employees, I’m truly looking forward to once again welcoming you on board a SAS flight in the near future.

Rickard Gustafson,

President and CEO

In May SAS landed an A340 at Copenhagen Airport (CPH) with a different kind of passengers in the cabin – not as interactive as our regular ones but nevertheless important to handle with safety and care.

This was our first cargo only flight with cabin-load, chartered by Blue Water Shipping, carrying 14 tons of face masks to protect the hardworking medical staff in Region Syddanmark. By placing cargo in the cabin, in addition to the traditional cargo hold below, we added space and were able to fly home as much protective equipment as possible in these critical times. The boxes are loaded manually in the cabin with great care and secured according to all safety measures stipulated by Airbus and International Air Transport Association (IATA).

In addition to the 7 pilots needed to operate this flight, cargo-only flights also require three cabin crew to make sure the cabin is safe during the entire flight.

Top Copyright Photo: SAS is also expected to simplify its fleet. Besides the planned upcoming retirements of the Boeing 737-700 and 737-800 fleets (still in 2024?), SAS has also parked its four Airbus A319s including OY-KBO in the retro livery. Scandinavian Airlines System-SAS (Scandinavian Airlines) Airbus A319-132 OY-KBO (msn 2850) (1952 retrojet) ZRH (Rolf Wallner). Image: 936041.

SAS aircraft slide show:

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SAS’ scheduled capacity fell nearly 95% in April 2020

Scandinavian Airlines-SAS has issued this report on April 2020 traffic:

SAS’ scheduled capacity fell with nearly 95% compared to last year as a result of the ongoing COVID-19 pandemic. During April, only a limited network in Norway and Sweden was maintained.

“We continue to face challenging times that are radically impacting our business.  Even though no one can foresee exactly how passenger demand will evolve in the coming months and years, it is clear that it will take a much longer time than previously anticipated. In our view, it will take until 2022 before demand starts to reach pre-COVID-19 levels.

“The current situation forces us to take all possible measures to reduce costs and preserve cash to be able to emerge from this crisis as a sustainable, profitable and vital part of Scandinavian infrastructure.  Given the time it will take to ramp up production, we have unfortunately had to initiate processes to reduce the size of our future workforce by up to 5,000 full-time positions.

“As part of our ongoing work to safeguard our future, I’m grateful and pleased that we now have secured the SEK 3.3Bn revolving credit facility guaranteed by the states of Sweden and Denmark. This additional liquidity will, alongside our initiated cost reduction measures, give us the time needed explore further opportunities and financial support to safeguard our business,” says Rickard Gustafson, CEO SAS.

In other news, SAS has named our first Airbus A321LR  as Jarl Viking!

The airline continued on social media:

Ever since SAS was founded in Scandinavia in 1946, we have named our aircraft after the very first Scandinavians; the Vikings. The aircraft are named after kings and chiefs, explorers and conquerors, armors and rune carvers, and Gods in the Norse mythology.

Only a few exceptions have been made. That happened for instance when we in 2006 received an Airbus A319 which was named Christian Valdemar Viking, after Crown Princess of Denmark Mary and Crown Prince of Denmark Frederik’s first born, Prince Christian.

Why Jarl Viking?

While kings ruled back in the Viking era, chiefs (‘earl’ in English, ‘jarl’ in Scandinavian) had a social rank just below the king and were known in the society as the king’s right hand.

If you think you have seen the name on a SAS aircraft before, you are correct: The name Jarl Viking belonged to one of our McDonnell Douglas MD-82s – LN-RMT from January 1991 until that Jarl Viking was retired in September 2013.

SAS aircraft photo gallery: