Tag 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 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.

Norwegian to reorganize its assets under Irish law

Norwegian Air Shuttle made this announcement:

Following the government of Norway’s decision to withhold further support from the airline, and the ongoing COVID-19 pandemic, Norwegian Air Shuttle ASA has decided to initiate an examinership process in Ireland relating to its subsidiary Norwegian Air International Limited (NAI), its wholly-owned asset company Arctic Aviation Assets DAC (AAA) and some of AAA’s subsidiaries; Norwegian will also enter in and get protection of the Irish Examinership process as a related party.

Norwegian has chosen an Irish process since its aircraft assets are held in Ireland. Norwegian has taken this decision in the interest of its stakeholders.

The purpose of the process is to reduce debt, rightsize the fleet and secure new capital. This reorganisation process protects the assets of the Norwegian group while allowing the company to focus on the rightsizing of the group. The process is estimated to take up to five months.

Norwegian will continue to operate its route network (currently limited due to the Covid situation) and trade as normal on the Oslo Stock Exchange (Oslo Børs). Norwegian Reward will continue as normal honouring and earning CashPoints for its members. Safeguarding as many jobs as possible, while rightsizing its asset base, will continue to be a top priority for the management team throughout this process.

Jacob Schram, Norwegian CEO, said: “Seeking protection to reorganise under Irish law is a decision that we have taken to secure the future of Norwegian for the benefit of our employees, customers and investors. Our aim is to find solutions with our stakeholders that will allow us to emerge as a financially stronger and secure airline.”

The process of examinership in Ireland allows financially sustainable businesses to address elements of the business which require restructuring with the aim of protecting jobs and preserving the core value of the business. This protection, through a court appointed examiner, ultimately allows a company to secure new capital and implement a legally binding scheme for the settlement of debts.

“Our intent is clear. We will emerge from this process as a more financially secure and competitive airline, with a new financial structure, a rightsized fleet and improved customer offering,” said Schram.

Based on Norwegian’s current cash position and the projections going forward, the company believes it has sufficient liquidity to go through the above-mentioned process.

Norwegian is forced to furlough an additional 1,600 employees following the government’s decision not to give further support

Norwegian is forced to furlough employees and reduce capacity considerably following the government’s decision to not support the company financially to get through the corona crisis while simultaneously imposing travel restrictions that actively discourage passengers from travelling. The consequences of the government-imposed travel restrictions are critical and Norwegian needs to keep its running costs to a minimum, while the company continues to work on solutions to survive.

“Following today’s disappointing announcement from the government, we have no choice but to furlough an additional 1,600 colleagues and park 15 of the 21 aircraft we’ve operated the past months. Recently government-imposed travel restrictions have effectively stifled any hope of a stable and progressive recovery, Norwegian has been hit from all sides by factors outside of our control. This is a sad day for everyone at Norwegian and I sincerely apologise to all our colleagues that are now affected, but there is no other alternative. Prior to COVID-19, Norwegian employed more than 10,000 people, but the coming months there will be only 600 colleagues employed. Our goal is to keep six aircraft on domestic routes in Norway, and I expect that Norwegian will also receive route support from the Ministry of Transportation, as previously announced,” said CEO Jacob Schram of Norwegian.

Unfortunately, the significant route reduction will also affect customers who have already booked a flight with Norwegian.

“We will do everything we can to offer affected customers alternative travel option and I sincerely apologize for the inconvenience caused by this situation. All affected customers will be notified by us directly,” said Schram.

These routes will be operated

Oslo – Alta

Oslo – Bergen

Oslo – Bodø

Oslo – Evenes

Oslo – Haugesund

Oslo – Kirkenes

Oslo – Molde

Oslo – Stavanger

Oslo – Tromsø

Oslo – Trondheim

Oslo – Ålesund

Tromsø – Longyearbyen