Hailed in recent years for rapid expansion, Norwegian has now released its fourth quarter and full year results for 2018. On the back of the figures, the airline states that – rather move on with additional expansion – it will seek to increase and improve profitability through multiple initiatives.
While celebrated in recent years for its rapid expansion, Norwegian has just unveiled its fourth quarter and full year results for 2018. The numbers? The low-cost airline’s growth was 18% in the first quarter and down to -1% by the final quarter; around 9% growth for the year.
That’s a significant dip, especially when compared to previous years when Norwegian enjoyed 15 to 20% growth. In 2017 alone, it increased its carrying capacity by 37%.
In an official statement, Norwegian explained how its figures had been impacted by a number of factors in 2018, including high fuel prices and sturdy competition within the market plus costly problems with the Rolls Royce engines of its Dreamliner fleet.
City A.M. put the results for the year into perspective, explaining that, “Revenue in the fourth quarter grew 23 per cent year-on-year to 9.7bn Norwegian krone ($1.12bn) while the firm’s loss before interest and tax ballooned 40 per cent to 1.8bn ($2bn).”
With respect of this latter issue, the carrier explains that it does not anticipate that engine problems will have an impact with its onward operations.
Eyeing its future plan, Norwegian said, “The key priority going forward is returning to profitability through a series of measures, including an extensive cost reduction program, an optimized route portfolio and sale of aircraft.”
Offering his comments, Bjørn Kjos, the carrier’s CEO, said, “We have taken a series of initiatives to improve profitability by reducing cost and increasing revenue going forward. We have optimized our base and route structure to streamline the operation as well as divested aircraft, postponed aircraft deliveries and not least started an internal cost reduction program, which will boost our financials and bring us back to profitability.”
He further stated, “Going into 2019, we will enter a period of slower growth and fewer investments, while constantly looking for new and smarter ways to improve our efficiency and offer new products and services to attract new customers.”