Norwegian Air Shuttle Asa · OSL:NAS
Norwegian Air Shuttle Asa — Q1 2017 Earnings Presentation
25 slides from Norwegian Air Shuttle Asa's earnings presentation, Apr 27, 2017
Slide 1: Norwegian Air Shuttle ASA Q1 2017 Presentation
Norwegian Air Shuttle ASA Q1 2017 Presentation 27 April 2017
Slide 2: Highlights Q1 2017
Highlights Q1 2017 Launched 39 new routes for spring/summer 2017, including new intercontinental routes with the MAX Ranked the 31st most valuable airline brand in the world (up from 44th last year) by Brand Finance This year’s UNICEF flight went to Mali in Africa, carrying 13 tons of emergency aid
Slide 3: 6.7 million passengers in Q1 (+14 %)
6.7 million passengers in Q1 (+14 %) 8 7 + 14 % 6 5 4 3 Passengers (million) 2 1 0 Q1 08 Q1 09 Q1 10 Q1 11 Q1 12 Q1 13 Q1 14 Q1 15 Q1 16 Q1 17 Pax (mill) 2.0 2.1 2.7 3.1 3.6 3.9 4.9 4.9 5.8 6.7 3
Slide 4: Available Seat KM (ASK)
Stable Q1 load factor of 84 % (85 %) 24 % growth in capacity (ASK) 23 % growth in traffic (RPK) Average flying distance increased by 6 % Load ASK Load Factor 18,000 -0.8 p.p. 100% 17,000 16,000 85.2 % 84.4 % 90% 83.0 % 15,000 77.2 % 77.3 % 77.2 % 76.1 % 74.8 % 75.1 % 74.3 % 80% 14,000 13,000 70% 12,
Slide 5: Continued growth in all key airports
Continued growth in all key airports 5 Source: 12 month rolling passengers as reported by Avinor, Swedavia, Copenhagen Airports, Finavia, Gatwick Airport, Aena
Slide 6: Continued passenger growth in US and Spain
Continued passenger growth in US and Spain Strongest growth rate in US, Spain and France 6 % passenger growth in the Nordics Growth in number of passengers in Q1 17 (y/y): Split passengers by origin in Q1 17: 6
Slide 7: 9 % revenue growth in Q1
9 % revenue growth in Q1 Q1 unit passenger revenue -17 % to 0.28 (-13 % in constant currency) 15 % growth in ancillary revenue (flat NOK 138 per passenger) Other revenue driven by Reward, Cargo, external leasing and SLB gains 7,000 + 9% 6,000 5,000 4,000 3,000 2,000 NOK million 1,000 0 Q1 13 Q1 14 Q
Slide 8: Growth driven by both new routes and frequency
Growth driven by both new routes and frequency Total ASK growth of 20 % the last 12 months Balanced growth on increased frequency and new routes 60000 58000 56000 54000 52000 50000 48000 46000 44000 ASK Q116 New routes Closed Frequecy New routes Frequency ASK Q117 12 mths routes changes changes 12 m
Slide 9: Launched new routes with the 737 MAX
Launched 12 new routes with the 737 MAX 9
Slide 10: Intercontinental routes for summer 2017
Intercontinental routes for summer 2017 10
Slide 11: Adding nine 787-9 Dreamliners in 2017
Adding nine 787-9 Dreamliners in 2017 Widebody aircraft Deliveries 787-8 Deliveries 787-9 (delivered and firm orders) (291 seats) (344 seats) 2013 2014 2015 2016 2017 2018 Q1 Q2 Q3 Q4 Aircraft 3 7 8 12 21 32 Seats 873 2 037 2 328 3 704 6 800 10 584 11
Slide 12: Adding 32 new aircraft in 2017
Adding 32 new aircraft in 2017 Deliveries 787-9 Deliveries 737-800 and 737 MAX Re-deliveries 737-800 2017: +3,096 seats +4,296 seats -744 seats 200 191 8 180 17 163 160 A321LR owned 12 20 144 B787-8/B787-9 owned 140 7 20 B787-8/B787-9 leased 14 32 120 B737 MAX 8 owned 116 16 6 3 B737-800 owned 9 99
Slide 13: Financials
Financials 13
Slide 14: Q1 impacted by higher fuel cost and lower RASK
Q1 impacted by higher fuel cost and lower RASK 12 mths rolling 12 mths rolling (NOK million) Q1 17 Q1 16 Chg Q1 17 Q1 16 Chg Revenue 5,406 4,961 446 26,500 23,417 3,083 EBITDAR (607) 63 (670) 5,289 3,688 1,600 EBITDA (1,338) (606) (732) 2,385 1,377 1,008 Pre-tax profit (EBT) (1,848) (992) (856) 652
Slide 15: Less impact of wetlease and hedging
Less impact of wetlease and hedging 12 mths rolling 12 mths rolling NOK million Q1 17 Q1 16 Chg Q1 17 Q1 16 Chg Revenue 5,406 4,961 446 26,500 23,417 3,083 EBITDA as reported -1,338 -606 -732 2,385 1,377 1,008 Other losses/gains -255 -528 273 849 -1,005 1,854 EBITDA ex. other losses/gains -1,083 -78
Slide 16: EBITDA bridge Q1 2017 vs last year
EBITDA bridge Q1 2017 vs last year EBITDA* Increased Yield Load Gain from EBITDA* Q1 16 fuel price change change SLB Other Q1 17 0 -78 -200 -400 -600 -800 -1000 -1200 -1,083 Passenger tax Norway -1400 -1600 16 * Ex. other losses/gains
Slide 17: Q1 split of unit revenue and cost by currency
Q1 split of unit revenue and cost by currency Currency split RASK: Currency split CASK: 17
Slide 18: Operating cost EBITDA level per ASK (CASK)
Q1 unit cost ex. fuel decreased by 4 % to NOK 0.34 2 % lower unit cost ex. fuel in constant currency Unit cost increased by 4 % to NOK 0.44 (6 % in constant currency) 0.55 0.16 CASK ex. fuel 0.50 0.11 Fuel share of CASK 0.45 0.15 0.12 0.15 0.40 0.13 0.10 0.07 0.10 0.14 Operating cost EBITDA level pe
Slide 19: Full impact of lower fuel cost
Full impact of lower fuel cost 0.16 Higher Fuel cost (+43 % per ASK) driven by price (+53 %) offset by stronger NOK 0.14 vs USD (3 %) Higher Personnel cost (+2 % per ASK) 0.12 due to ramp-up of intercontinental operations. 32 % increase in FTE’s 0.10 Lower Airport/ATC (-14 % per ASK), Fuel 0.08 Hand
Slide 20: NOK 1.4 bn cash-flow from operations in Q1
NOK 1.4 bn cash-flow from operations in Q1 Strong liquidity with NOK 4.8 bn in cash at the end of Q1 (+NOK 0.3 bn in undrawn facility) Cash-flow from operations of NOK 2.3 bn the last 12 months Invested NOK 5 bn the last 12 months, of which NOK 4.3 bn is financed with external debt 12 mths rolling 1
Slide 21: Financing on track
Financing on track Expected capex (all aircraft incl. PDP) USD 1.3 bn for 2017 (reduced from USD 1.8 bn) USD 2.1 bn for 2018 (unchanged) PDP financing / liquidity PDP financing for 50 Airbus 320neo’s Credit facility (NOK 1 bn) New unsecured bond (SEK 1 bn) Long-term financing Export credit guarantee
Slide 22: Net debt reduced by NOK bn
Net debt reduced by NOK 1 bn Added eight new 737-800 and three 320neo’s on balance the last 12 months NOK 20 bn net debt (reduced from 21 bn in Q4 2016) 6 % equity ratio (unchanged y/y). 10 % when adding market value of Bank Norwegian (NOFI) 40,000 35,000 Aircraft financing Aircraft 17,389 30,000 22
Slide 23: Outlook for 2017
Outlook for 2017 Markets and business Negative impact from passenger tax in Norway and weaker demand in the UK Negative revenue impact from currency and distance Capacity adjusted booking volumes on par with last year, except some softness in May An estimated production growth (ASK) of 30 % (unchang
Slide 24: Going forward
Going forward Focus on global expansion and strong growth in staff, routes and aircraft European launch customer of the 737 MAX 8 The new intercontinental routes with the MAX well received in the market Startup of US-Spain with 787’s in Q2 Launched new routes from London to Seattle, Denver and Singa
Slide 25: Norwegian operates 482 routes to 133 destinations
Norwegian operates 482 routes to 133 destinations From bases in SWEDEN DENMARK Intercontinental FINLAND From bases in From the From bases in SPAIN UK base NORWAY 25
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