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NORWEGIAN

Norwegian profits fall on Dreamliner problems

Norwegian Air Shuttle had to spend over 100 million kroner ($17m) after its two new Boeing Dreamliner aircraft were grounded due to technical faults, the company reported as it released results on Friday.

Norwegian profits fall on Dreamliner problems
Norwegian's new Dreamliner arriving from New York at Stockholm Arlanda airport - Johan Nilsson / NTB Scanpix
"Our results this quarter are significantly affected by the additional costs associated with replacement aircraft for the Dreamliner," the company's chief executive Bjørn Kjos said in a statement.   
 
According to the company, the sum included the cost of leasing replacement aircraft, extra fuel and costs for the accommodation, food and drink for delayed passengers. 
 
The company's net profit of 436 million kroner ($73m) for the three months to September was down nearly a third compared to the same period the previous year. 
 
The company estimated that it had lost a further 150 million kroner as a result of an unusually warm summer in its key northern European markets. 
 
"Northern European sun seekers chose to enjoy the warm summer at home instead of flying south,” Kjos said. 
 
Norwegian is planning to build up a fleet of eight Dreamliners, hoping to capitalize on fuel costs up to twenty percent lower than its existing fleet.
 

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AIRLINE

Airline Norwegian posts 15 billion kroner loss after nightmare 2020

Low cost airline Norwegian has registered a loss of 14.9 billion Norwegian kroner for 2020, a year in which the company saw a drastic reduction in passenger numbers and was on the brink of bankruptcy.

A file photo of a Norwegian Air Shuttle plane in Finland.
A file photo of a Norwegian Air Shuttle plane in Finland. Heikki Saukkomaa / Lehtikuva / AFP

Low cost airline Norwegian has registered a loss of 14.9 billion Norwegian kroner for 2020, a year in which the company saw a drastic reduction in passenger numbers and was on the brink of bankruptcy.

The company published its annual results on Friday, revealing the huge operating loss.

Norwegian’s 2019 result, a loss of around 1.7 billion kroner, had put the company in a difficult position even prior to the outbreak of the Covid-19 pandemic.

The coronavirus outbreak and its consequent travel restrictions reduced the company’s passenger numbers to 6.9 million in 2020. That is 29 million fewer than in 2019.

Not all of the loss is due to fewer passengers. Around half of the company’s devaluation is attributed to a depreciation of the value of its aircraft fleet, news wire Ritzau reports.

“2020 was an exceptionally demanding year for air travel and for Norwegian,” CEO Jacob Schram said in a statement on the annual results.

“In light of that, the result for the fourth quarter (of 2020) is not surprising. Unfortunately, the majority of our employees are furloughed and many have lost their jobs – in part because of the closure of long distance services,” he added.

The company was already in debt prior to the pandemic and is now under bankruptcy protection in Ireland and is undergoing similar process in Norway.

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