Norwegian Air Shuttle Asa · OSL:NAS

Norwegian Air Shuttle Asa — Q1 2014 Earnings Presentation

20 slides from Norwegian Air Shuttle Asa's earnings presentation, 2014

  1. Slide 1: Norwegian Air Shuttle ASA Q1 2014 Presentation

    Norwegian Air Shuttle ASA Q1 2014 Presentation Europe’s best low-cost airline

  2. Slide 2: Double digit revenue growth in Q1

    Europe’s best low-cost airline Double digit revenue growth in Q1 • Group revenues of MNOK 3,551 in Q1 2014 + 22 % 3 500 3 000 2 500 Domestic Revenue (MNOK) 2 000 International Revenue (MNOK Total Revenues (MNOK) 1 500 1 000 MNOK 500 0 Q1 11 Q1 12 Q1 13 Q1 14 Revenues 1 895 2 360 2 904 3 551 Domes ti

  3. Slide 3: Seasonally weak Q1 influenced by capacity investment

    Europe’s best low-cost airline Seasonally weak Q1 influenced by capacity investment Q1 14 Q1 13 EBITDAR MNOK -215 438 EBITDA MNOK -615 189 EBIT MNOK -777 69 Pre-tax profit (EBT) MNOK -813 -160 Net profit MNOK -595 -117 EBITDAR development Q1 EBT development Q1 450 0 438 350 -100 -160 250 -200 -300 1

  4. Slide 4: Operational and currency headwinds in Q1

    Europe’s best low-cost airline Operational and currency headwinds in Q1 • Wet-lease on long-haul – Delayed delivery of Dreamliner #4 – Slow DOT approval process causes suboptimal scheduling • Weak NOK vs. USD, EUR, GBP and SEK • Unit revenue – Own capacity investment – Competitive pressure to/from/w

  5. Slide 5: Ancillary revenue remains a significant contributor

    Europe’s best low-cost airline Ancillary revenue remains a significant contributor • Ancillary revenue comprises 15% of Q1 revenues • NOK 110 per scheduled passenger (an increase of 25% from last year) 5

  6. Slide 6: Net positive cash flow of one billion in Q1

    Europe’s best low-cost airline Net positive cash flow of one billion in Q1 ● Cash flows from operations in Q1 14 MNOK 1 102 (MNOK 962) ● Cash flows from investing activities in Q1 14 MNOK -1 034 (MNOK 158) ● Cash flows from financing activities in Q1 14 MNOK 927 (MNOK -407) ● Cash and cash equivalen

  7. Slide 7: Equity ratio affected by NOK 2.9 billion increase in non-current assets

    Europe’s best Five on-B/S aircraft delivered in seasonally weak Q1: low-cost airline Equity ratio affected by NOK 2.9 billion increase in non-current assets ● Total balance of NOK 17.3 billion ● Net interest bearing debt NOK 4.2 billion ● Equity of NOK 2.1 billion at the end of Q1 14 ● Group equity

  8. Slide 8: Higher load in spite of 48% capacity increase

    Europe’s best low-cost airline Higher load in spite of 48% capacity increase • 50% traffic growth • Average flying distance up 15% + 48 % 9 000 1 ASK Load Factor 8 000 76.8 % 77.2 % 77.2 % 76.1 % 77.3 % 74.8 % 74.8 % 75.1 % 74.3 % 0.8 7 000 68.0 % 6 000 0.6 5 000 4 000 0.4 Available Seat KM (ASK) 3

  9. Slide 9: 4.9 million passengers in Q1

    Europe’s best low-cost airline 4.9 million passengers in Q1 • An increase of 930,000 passengers +24 % 4.00 3.00 2.00 Passengers (million) 1.00 0.00 Q1 05 Q1 06 Q1 07 Q1 08 Q1 09 Q1 10 Q1 11 Q1 12 Q1 13 Q1 14 Pax (mill) 0.6 1.0 1.3 2.0 2.1 2.7 3.1 3.6 3.9 4.9 9

  10. Slide 10: Growing market share in all markets

    Strong demand: Europe’s best low-cost airline Growing market share in all markets • Business model works – lower costs and prices attract volume + 238,000 pax 91% of mkt growth 40 % 35 % 30 % + 291,000 pax 69% of mkt growth 25 % 20 % + 109,000 pax 50% of mkt growth + 98,000 pax 59% of mkt growth + 2

  11. Slide 11: Norwegian's short-haul seat growth in Scandinavia prudent

    Europe’s best low-cost airline Norwegian’s short-haul seat growth in Scandinavia prudent • Summer season 2014 seat growth in line with market • Superior unit cost at primary airports allows larger than average growth Source: OAG Aviation Worldwide Schedules Analyser. The graph depicts change in depa

  12. Slide 12: Norwegian's S14 capacity growth evenly distributed

    Europe’s best low-cost airline Norwegian’s S14 capacity growth evenly distributed • Highest growth in departing capacity (ASK) from the USA • Total growth high - but subtle share in all markets Norwegian ASK Apr - Sep

  13. Slide 13: Lowest cost always wins

    Europe’s best low-cost airline Lowest cost always wins Sources: Norwegian Q1 2014 report (period displayed April 2013 – March 2014), SAS Interim Report November 2013 – January 2014, Scandinavian Airlines (SK) only from February 2013 – October 2013, SAS Group figures from November 2013 – January 2014

  14. Slide 14: Unit cost at constant ccy and excl one-off down 9%

    Europe’s best low-cost airline Unit cost at constant ccy and excl one-off down 9% • Unit cost ex fuel down 4% - hampered by weak NOK & Long-Haul wet lease • Unit cost including fuel down 3% - hampered by weak NOK & Long-Haul we tlease 0.50 -3% Fuel share of CASK 0.45 0.12 0.15 CASK excl fuel Operati

  15. Slide 15: Aiming for FY CASK NOK 0.25 excluding fuel

    Europe’s best low-cost airline Aiming for FY CASK NOK 0.25 excluding fuel Scale economies New more efficient aircraft Growth adapted to int’l markets • Uniform fleet of Boeing 737-800s • Flying cost of 737-800 lower than 737-300 • Cost level adapted to local markets • Overheads • 737-800 has 38 “fre

  16. Slide 16: Unit cost under control – further upside

    Europe’s best low-cost airline Unit cost under control – further upside – Phase-out 737-300 (Fuel, Tech, Handling, Airport/ATC & Personell) – Phase-in Max / Neo / Dreamliner (Fuel & Tech) – Larger scale (Overhead, Sales & distrib., Personell) – Further automation (Overhead, Personell, Handling, Sale

  17. Slide 17: A fleet of 17 Dreamliners by 2018

    Three additional aircraft: Europe’s best low-cost airline A fleet of 17 Dreamliners by 2018 Five 787-8 in operation Three 787-8 on firm order Nine 787-9 on firm order 2014 2016 2015 2017 2018

  18. Slide 18: Current committed fleet plan

    Europe’s best low-cost airline Current committed fleet plan Deliveries 787-8 Deliveries 737-800 Re-deliveries 737-300 Re-deliveries 737-800 2014: +1,164 seats +2,604 seats -740 seats -558 seats 18

  19. Slide 19: Expectations for 2014 (Group)

    Europe’s best low-cost airline Expectations for 2014 (Group) • Business environment – Economic uncertainty in parts of Europe – Seasonal fluctuations – Yield pressure from capacity investment – Increased competitive pressure in the Nordic region • Production – The company expects a production growth

  20. Slide 20: Norwegian offers 417 scheduled routes to 126 destinations

    From bases in NORWAY SWEDEN From bases in DENMARK Norwegian offers 417 FINLAND scheduled routes to 126 destinations in 39 countries From bases in the USA & THAILAND From bases in SPAIN From the UK base

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