Norwegian today reported its H1 results for the year of 2020. During the presentation, the airline revealed that it has suffered a new loss of NOK 5.3 billion ($603 million) as a result of the COVID-19 pandemic. Due to its reduced operations, 140 of the airline’s aircraft are still grounded.
Around the world, almost every airline has been negatively affected as a result of the COVID-19 pandemic. However, the crisis has hit some airlines harder than others. Taking Ryanair as an example, the airline is already operating a huge portion of its fleet. However, other carriers, such as Norwegian, haven’t been faring so well.
140 aircraft grounded
Norwegian today revealed that 140 of its aircraft are currently grounded. This includes the airline’s 18 Boeing 737 MAX aircraft. Indeed, only between seven and eight of the airline’s aircraft were actually flying in the second quarter of 2020. Each of these few aircraft was only flown on average for 10.4 hours per day. Meanwhile, last year aircraft utilization stood at 12.3 hours per day.
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It’s not all bad news though. While passenger numbers have plummeted since the airline entered hibernation mode, the load factor still stood at 78.2% for the six months. As would be expected from operating far fewer flights, Norwegian ended up with a much lower fuel bill for the half that clocked in at NOK 1.8 billion ($204 million) down from NOK 6.3 billion ($716 million) last year.
NOK 5 billion loss
While we’re on the subject of cash, let’s take a look at how the airline performed financially in the last six months. Of course, with far fewer passengers, the airline’s total operating revenue fell by over half compared to the same period in the year before.
In total, the airline made a loss of NOK 5 billion ($568 million) for the period. For comparison, this stood at a much lower NOK 836 million ($95 million) loss for the same six months in 2019.
Commenting on the situation, the airline’s CEO Jacob Schram said,
“When we entered 2020, we were expecting a positive result and the best summer ever, thanks to successful cost-saving initiatives and a more efficient operation. Then we were hit by COVID-19 and customer demand literally stopped from one day to the next, as government-imposed travel restrictions and travel advice were introduced world-wide.”
What’s next for Norwegian?
Norwegian is slowly ramping up its operations once more. As we mentioned, 140 of the airline’s 160 aircraft remain grounded. However, the carrier hopes to increase its operational fleet to 25 aircraft in September. The plan beyond September has yet to be released. Norwegian said that it will depend on the latest government advice and restrictions, tied with customer demand. IATA currently expects passenger demand to take four years to recover to 2019 levels.
For the time being, Norwegian won’t take delivery of any new aircraft. In July, Simple Flying reported that Norwegian had canceled 97 aircraft orders due from Boeing, including 92 737 MAX aircraft.
What do you make of Norwegian’s H1 results? Let us know your thoughts in the comments!