Norwegian Air Shuttle Asa · OSL:NAS

Norwegian Air Shuttle Asa — Q2 2015 Earnings Presentation

22 slides from Norwegian Air Shuttle Asa's earnings presentation, 2015

  1. Slide 1: Norwegian Air Shuttle ASA Q2 2015 Presentation

    Norwegian Air Shuttle ASA Q2 2015 Presentation Best low-cost airline in Europe 2013-2015 World’s best Long Haul low-cost airline 2015 Photo: Bo Mathiesen

  2. Slide 2: Q2 2015 Highlights

    Europe’s best low-cost airline Q2 2015 Highlights 2013,2014 & 2015 • New routes launched – domestic Spain – London-Boston – Caribbean (Puerto Rico + winter routes) • SkyTrax awards 2015 – Best Low-Cost airline in Europe (3 years in a row) – World’s best Long Haul Low-Cost airline • Three new aircraf

  3. Slide 3: Q2 revenue increased by 16%

    Europe’s best low-cost airline Q2 revenue increased by 16 % 2013,2014 & 2015 • Group revenues almost doubled in three years • A strong 60% revenue growth for long-haul + 16 % 6 000 5 000 4 000 Domestic revenue 3 000 International revenue Total Revenues 2 000 NOK million 1 000 0 Q2 12 Q2 13 Q2 14 Q2

  4. Slide 4: 25% growth in ancillary to 15% share of group revenue

    Europe’s best low-cost airline 25 % growth in ancillary to 15 % share of group revenue 2013,2014 & 2015 • Split: Group ancillary per NOK 125 + 14 % y.o.y customer NOK 110 Flexibility/ modifications – Growth driven by bundle and Flexibility/ modifications freedom to choose Pre-sold packages Pre-sold

  5. Slide 5: EBT improved by NOK 593 million on higher load

    Europe’s best low-cost airline EBT improved by NOK 593 million on higher load 2013,2014 & 2015 (NOK million) Q2 15 Q2 14 Change EBITDAR 1 285 563 722 EBITDA 765 94 EBIT 520 -85 Pre-tax profit (EBT) 456 -137 593 Net profit 325 129 EBITDAR development Q2 EBT development Q2 1 450 1 450 1 250 1 285 1 25

  6. Slide 6: Tailwind from fuel offset by currency

    Europe’s best low-cost airline Tailwind from fuel offset by currency 2013,2014 & 2015 • USD/NOK has strengthened by 29 % y.o.y • Spot fuel price down by 39 % (-20 % in NOK) • Saved NOK 572 million on lower fuel cost (-18 % per ASK) – NOK 826 million reduction due to lower spot price – NOK 42 million

  7. Slide 7: NOK 1.3 billion cash-flow from operations

    Europe’s best low-cost airline NOK 1.3 billion cash-flow from operations 2013,2014 & 2015 • Invested NOK 1.1 billion in new aircraft in Q2 (one 787 and two 737’s) • Financing: NOK 1 billion bond issue in May • NOK 3 billion in cash at 30 June CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW Unaudited Q

  8. Slide 8: Balance sheet boost by currency and new aircraft

    Europe’s best low-cost airline Balance sheet boost by currency and new aircraft 2013,2014 & 2015 • Invested NOK 4.7 billion the last 12 months • Seven new 737-800 and one 787 on balance since Q214 • NOK 12.6 billion net debt 30 000 27 000 24 000 Aircraft Financing 21 000 Aircraft 12 092 15 140 18 00

  9. Slide 9: Load factor increased to 85.2% (+5 p.p.)

    Europe’s best low-cost airline Load factor increased to 85 % (+5 p.p.) 2013,2014 & 2015 • 8 % growth in capacity (ASK) • 15 % growth in traffic (RPK) • Average flying distance increased by 6 % 15 000 ASK 100% ASK Load Factor +8 % 14 000 85,2 % 13 000 79,1 % 79,4 % 78,4 % 78,3 % 78,3 % 79,6 % 12 000

  10. Slide 10: 7.0 million passengers in Q2 2015 (+9%)

    Europe’s best low-cost airline 7 million passengers in Q2 2015 (+9 %) 2013,2014 & 2015 324,000 passengers on Long-Haul in the second quarter vs 139,000 in Q2 last year 8 + 9% 7 6 5 4 3 Passengers (million) 2 1 0 Q2 06 Q2 07 Q2 08 Q2 09 Q2 10 Q2 11 Q2 12 Q2 13 Q2 14 Q2 15 Pax (mill) 1,3 1,6 2,3 2,8 3

  11. Slide 11: Unit cost cut by 5% to NOK 0.40

    Europe’s best low-cost airline Unit cost cut by 3 % to NOK 0.40 2013,2014 & 2015 0,55 CASK excl fuel Fuel share of CASK 0,50 0,13 Operating cost EBITDA level per ASK (CASK) 0,12 0,45 0.15 0,09 0,12 0,40 0,15 0,15 0,14 0,35 0,14 0,11 0,41 0,38 0,42 0,30 0,35 0,35 0,32 0,31 0,29 0,29 0,28 0,25 Q2 06 Q

  12. Slide 12: Aiming for NOK 0.25 per ASK (ex fuel)

    Europe’s best low-cost airline Aiming for NOK 0.25 per ASK (ex fuel) 2013,2014 & 2015 0,80 0.74 0,70 0.62 0.59 0,60 Make or break 0.49 0.49 0,50 0.42 Operating cost EBITDA level per ASK (CASK) 0,40 0.30 0,30 0.25 Comfort Zone 0,20 0,10 - Sources: Based on official full-year 2014 annual report for No

  13. Slide 13: Top modern fleet with an average age of 4 years

    Europe’s best low-cost airline Top modern fleet with an average age of 4 years 2013,2014 & 2015 Deliveries 787-8 Deliveries 737-800 Sale of 737-300 Re-deliveries 737-800 2015: +291 seats +1,860 seats -740 seats -372 seats 144 3 140 12 B788 Owned 117 12 120 B788/B789 Leased 3 5 A320neo 9 B737 MAX 8 9

  14. Slide 14: Market shares in key airports (last 12 months)

    Europe’s best low-cost airline Market shares in key airports (last 12 months) 2013,2014 & 2015 + 215,000 pax 39 % mkt share 10 000 000 9 000 000 8 000 000 7 000 000 + 63,000 pax 23 % mkt share 6 000 000 + 75,000 pax + 160,000 pax 18 % mkt share 4 % mkt share 5 000 000 + 220,000 pax 9 % mkt share 4 0

  15. Slide 15: Market shares Spanish airports (last 12 months)

    Europe’s best low-cost airline Market shares Spanish airports (last 12 months) 2013,2014 & 2015 1 250 000 + 35,000 pax 9 % mkt share + 8,000 pax 9 % mkt share + 16,000 pax 1 000 000 3 % mkt share - 11,000 pax 750 000 8 % mkt share + 112,000 pax 2 % mkt share - 600 pax 4 % mkt share 500 000 250 000 0

  16. Slide 16: Launched domestic routes in Spain

    Europe’s best low-cost airline Launched domestic routes in Spain 2013,2014 & 2015 o Madrid to: Tenerife North Gran Canaria o Barcelona to: Barcelona Tenerife North Madrid Gran Canaria Fuerteventura o Malaga to: Tenerife South Gran Canaria Malaga Tenerife North Fuerteventura Tenerife S. Gran Canaria

  17. Slide 17: New routes to North America and the Caribbean

    Europe’s best low-cost airline New routes to North America and the Caribbean 2013,2014 & 2015 17

  18. Slide 18: Long-haul status after two years of operation

    Europe’s best low-cost airline Long-haul status after two years of operation 2013,2014 & 2015 150 000 500 • Eight aircraft in operation (from May 2015) 120 000 400 • Launched 29 routes 90 000 300 Revenue (NOK million) 60 000 200 • Built up four bases (NY, FL, UK and Thailand) Passengers 30 000 100 •

  19. Slide 19: Expanding Long-haul operations

    Europe’s best low-cost airline Expanding Long-haul operations 2013,2014 & 2015 • Expanding fleet with 4 Boeing 787-9 in 2016 – 344 seat configuration (291 for the 787-8) – two in Q2 2016, and two in Q4 • An estimated 30 % ASK growth in 2015 and 38 % in 2016 • Reached critical mass and built market p

  20. Slide 20: Expectations for 2015 (Group)

    Europe’s best low-cost airline Expectations for 2015 (Group) 2013,2014 & 2015 • Business environment – Bookings for Q3 2015 ahead of last year (capacity adjusted) – Stable market in the Nordic region – Good load and improving yield for long-haul • The company expects a production growth (ASK) of 5 %

  21. Slide 21: Summary

    Europe’s best Summary low-cost airline 2013,2014 & 2015 • Awarded Europe’s Best Low-Cost Carrier 2015 and Global Best Low-Cost Long- Haul Carrier 2015 by SkyTrax • Bookings for Q3 2015 ahead of last year • An estimated NOK 2 billion lower fuel cost for 2015 • Expect positive contribution from Long-

  22. Slide 22: Norwegian offers 434 scheduled routes to 130 destinations in 39 countries

    From bases in NORWAY SWEDEN From bases in DENMARK 22 Norwegian offers 434 FINLAND scheduled routes to 130 destinations in 39 countries From bases in the USA & THAILAND From bases in SPAIN From the UK base 22

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