Icelandair Group Hf · OMXICE:ICEAIR
Icelandair Group Hf — Q3 2022 Earnings Presentation
21 slides from Icelandair Group Hf's earnings presentation, Oct 21, 2022
Slide 1: Q3 2022 results
Q3 2022 results 21 October 2022 1
Slide 2: Highlights
Highlights Robust third quarter Strong Route network Full year results with USD 58 financial capacity 82% of 1-3% EBIT million profit position 2019 level margin expected EBIT USD 93 million Total liquidity at USD 372 million Disruptions at outstations Resilient bookings in all our negatively impacti
Slide 3: Record load factor of 87.7%
Record load factor of 87.7% Number of passengers doubled with more balanced mix between main markets Main KPI‘s Passenger mix Freight ton kilometers Sold block hours CO2 emissions As % of 2019 Thousands FTK ´000 Leasing operation Per OTK* 91% within 35,087 4,027 0.92 1,430 82% to 5% 29,661 3,427 fro
Slide 4: Achieving great results required a joint effort of all employees
Achieving great results as in the third quarter this year has required a joint effort of all our employees, who have shown incredible dedication and worked hard through every challenge 4
Slide 5: Financials
Financials Ívar Sigurður Kristinsson, CFO 5
Slide 6: Strong third quarter results with 19% EBIT ratio
Strong third quarter results with 19% EBIT ratio The business model proves it´s strength Profit loss statement EBIT USD million USD million USD million Q3 2022 Q3 2021 Change +84.5 • Robust revenue generation Transport revenue 451.7 208.5 243.2 Aircraft and aircrew lease 13.5 9.6 3.9 92.7 • Highest
Slide 7: Unit revenue up 38% year-on-year
Unit revenue up 38% year-on-year Record load factor and improved yields RASK* Load factor Load factor Main changes in RASK US cent % Q3 2021 vs Q3 2022 % per route market +38% • Higher yields and record load 9.2 +19 ppt factor on significantly higher production 88% 89% 86% 6.7 76% • Positive develop
Slide 8: Unit cost excluding fuel down by 8%
Unit cost excluding fuel down by 8% Fuel CASK CASK* Main drivers of lower unit US cent US cent cost CASK excluding fuel Fuel CASK CASK US cent US cent US cent +75% +12% • Better utilization of the asset base with increased capacity 2.8 7.4 -8% 6.6 • USD FX development 5.1 favorably impacting unit co
Slide 9: High fuel price and more production driving higher fuel cost
High fuel price and more production driving higher fuel cost Fuel cost Hedge contracts and ratios Average Fuel and EUA credit prices USD million Hedged ton, Hedge Ratio % Floating and effective: USD / mt EUA: EUR / Credit +86.7 91 87 1.500 136.7 84 85 25,442 Market price (right axis) 84 81 81 1.400
Slide 10: Total liquidity USD 373 million at the end of Q3 2022
Total liquidity USD 373 million at the end of Q3 2022 Cash and marketable securities decreased by USD 90 million during the quarter Total liquidity Liquidity development Breakdown in USD million Q3 2022 in USD million 463 435 52 43 373 463 120 52 49 30 52 54 22 373 58 34 463 368 373 315 290 Governme
Slide 11: Total assets amounting to USD 1.4 billion
Total assets amounting to USD 1.4 billion Equity ratio 20% Assets Equity ratio Financial liabilities Net financial liabilities USD million USD million USD million Non-current assets Equity ratio excl. warrants Interest bearing debt Current assets Equity ratio Lease liabilities 1.435 21% 612 291 20%
Slide 12: Key takeaways and outlook
Key takeaways and outlook Bogi Nils Bogason, CEO 13
Slide 13: Challenging operational condition
Challenging operational condition Home operation in Keflavik consistent Recruitment went well in our airport operation in our hub in Keflavik All positions for the summer were filled and the operation was consistent during high season Disruptions at outstations Staffing issues at major international
Slide 14: The route network is at the heart of our business model
The route network is at the heart of our business model 50 Destinations 677 origin and destination markets served within network Countless others through partnerships 3 connection banks 3 new destinations last summer Rome, Nice, Raleigh-Durham Day flights to North America Departure around 10 AM GMT
Slide 15: Strong infrastructure supports our revenue generation
Strong infrastructure supports our revenue generation Icelandair strong brand as a base in all markets Premium cabin Strong Effective Strategic Valuable on all international sales distribution partnerships ecosystem of routes network channels businesses Refocused pricing strategy Broad distribution
Slide 16: Strategy of simplifying the operation is delivering benefits
Strategy of simplifying the operation is delivering benefits Divestment of non-core assets • Icelandair Hotels in 2020 • Iceland Travel in 2021 Integration of subsidiaries into the core business • IGS merged with Icelandair in 2018 • Fjárvakur shared services merged with Icelandair in 2019 • Air Ice
Slide 17: Two Boeing 767 freighter aircraft added to expand service across the North Atlantic
Two Boeing 767 freighter aircraft added to expand service across the North Atlantic Shortest and simplest Four freighter Our warehouse at KEF connection between destinations in the airport extended to Europe and N-America new cargo network accommodate more freight • New building 50% larger than exis
Slide 18: Icelandair 737 MAX fleet will grow to 20 aircraft by year-end 2023
Icelandair 737 MAX fleet will grow to 20 aircraft by year-end 2023 Fleet campaign in progress for deliveries beyond 2024 Continued fleet Commitment for Future fleet renewal with five additional campaign in Boeing 737 MAX Boeing 737 MAX progress Delivery overview Purchase agreement signed for four 73
Slide 19: Guidance
Guidance Capacity in the route network expected to be 98% of 2019 levels in the fourth quarter of the year Operating environment remains challenging; interest rates and cost on the rise which is likely to impact demand Booking status in Q4 resilient despite economic uncertainty Year-on-year unit rev
Slide 20: Q&A
Q&A 21
Slide 21: Disclaimer
Disclaimer | This material has been prepared by Icelandair Group hf. Unless stated otherwise all information is sourced by Icelandair Group hf. | The circulation of the information contained within this document may be restricted in some jurisdictions. It is the responsibility of the individual to c