Norwegian Air Shuttle ASA · 2015. 6. 29. · Norwegian Air Shuttle ASA Q3 2013 Presentation . Europe’s best low-cost airline ... 400 500 600 700 800 900 1 000 1 100 1 200 1 300

Europe’s best low-cost airline

Norwegian Air Shuttle ASA Q3 2013 Presentation


• Group revenues of MNOK 4,878 in Q3 2013

Double digit revenue growth in Q3

Revenues 2 828 3 376 4 224 4 878Domestic revenue 992 958 1 071 1 072% y.o.y. chg 27 % -3 % 12 % 0 %International revenue 1 836 2 419 3 153 3 806% y.o.y. chg 23 % 32 % 30 % 21 %

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

5 000

Q3 10 Q3 11 Q3 12 Q3 13

MN

OK

Domestic Revenue (MNOK)

International Revenue (MNOK)

Total Revenues (MNOK)

+ 15 %

2


Q3 13 Q3 12

EBITDAR MNOK 1 169 1 098

EBITDA MNOK 778 822

EBIT MNOK 638 708

Pre-tax profit (EBT) MNOK 604 873

Net profit MNOK 436 628

Pre-tax profit of MNOK 604 in Q3

Q3 10 Q3 11 Q3 12 Q3 13 Q3 10 Q3 11 Q3 12 Q3 13EBITDAR margin 30 % 36 % 26 % 24 % EBT margin 26 % 20 % 21 % 12 %

840

1 206

1 0981 169

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1 100

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MN

OK

733

686

873

604

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900

MN

OK

EBT development Q3 EBITDAR development Q3

3


• Estimated long-haul wet-lease, fuel & irregularity effects MNOK 101 – Planned wet-lease MNOK 64

– Increased fuel consumption A340 vs B788 MNOK 19

– IRR cost MNOK 18

• Start-up costs Long-Haul, LGW & ALC unadjusted for (business as usual)

Underlying EBT result MNOK 932

4

Europe’s best low-cost airline Extraordinary summer weather affected late bookings

Väderöarna, Bohuslän in Western Sweden, August 23rd 2013 5

Shar

e of

avai

labl

e se

ats

sold

on

typi

cal

leisu

re ro

utes

fro

m th

e No

rdics

(avg

. for

de

partu

re d

urin

g th

e m

onth

of J

uly)

Pre-sale period Departure

Fw d. Bookings (%) 2012

2013

15

17

19

21

23

25

Avg.

dai

ly m

axte

mpe

ratu

re

( °C) p

rece

ding

wee

k (O

slo) -

aver

age

for d

epar

ture

s in

July

2013

2012

1

2

3

4

5

6

7

Avg.

dai

ly p

recip

itatio

n (m

m)

prec

edin

g w

eek

(Oslo

) -av

erag

e fo

r dep

artu

res

in Ju

ly

2013

2012

Europe’s best low-cost airline Ancillary revenue remains a significant contributor

• Ancillary revenue comprises 11 % of Q3 revenues (target 15%)

• NOK 90 per scheduled passenger (an increase of 5 % from last year)

6

Europe’s best low-cost airline Cash position of NOK 2.3 billion (+568 million)

Cash flows from operations in Q3 13

Cash flows from investing activities in Q3 13

Cash flows from financing activities in Q3 13

Cash and cash equivalents at period-end MNOK 2 303

MNOK -68

MNOK -618

MNOK 67 (MNOK 460)

(MNOK -565)

(MNOK 267)

(MNOK 1735)

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWUnaudited

Q3 Q3 YTD YTD Full Year(Amounts in NOK million ) 2013 2012 2013 2012 2012

Net cash flows from operating activities 67.4 459.7 2 113.4 1 575.1 2 021.6

Net cash flows from investing activities -617.9 -564.9 -1 161.4 -1 220.1 -2 765.5

Net cash flows from financial activities -67.9 267.4 -378.2 276.1 1 369.4

Foreign exchange effect on cash -1.7 -1.8 -1.9 -1.3 0.3

Net change in cash and cash equivalents -620.1 160.4 571.9 629.8 625.8Cash and cash equivalents in beginning of period 2 922.9 1 574.4 1 730.9 1 104.9 1 104.9

Cash and cash equivalents in end of period 2 302.9 1 734.8 2 302.9 1 734.8 1 730.9

7

Europe’s best low-cost airline Equity improved by MNOK 561 compared to last year

• Total balance of NOK 14.4 billion

• Net interest bearing debt NOK 3.4 billion (2.7)

• Equity of NOK 2.9 billion at the end of the third quarter

• Group equity ratio of 20 % (22 %)

1 735Cash2 303

1 562

Receivables2 047

7 611

Non-current assets

10 011

0

2 000

4 000

6 000

8 000

10 000

12 000

14 000

Q3 12 Q3 13

MN

OK Equity

2 940 2 379

Pre-sold tickets2 530

1 763

Othercurrent

liabilities3 505

2 312

Long term liabilities

5 386

4 454

Q3 13 Q3 12

8

Europe’s best low-cost airline High load factor maintained on 31 % capacity growth

• Average flying distance up 11 %

ASK 683 1 033 1 694 2 333 3 590 3 979 5 331 6 480 7 780 10 223

Load Factor 68.5 % 86.4 % 84.7 % 86.1 % 81.8 % 82.2 % 80.5 % 84.4 % 82.6 % 81.4 %

68.5 %

86.4 % 84.7 % 86.1 %81.8 % 82.2 % 80.5 %

84.4 % 82.6 % 81.4 %

0

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Q3 04 Q3 05 Q3 06 Q3 07 Q3 08 Q3 09 Q3 10 Q3 11 Q3 12 Q3 13

Load

Fact

or

Avai

labl

e Se

at K

M (A

SK)

ASK Load Factor + 31 %

9

Europe’s best low-cost airline Passenger record in Q3

• 6.0 million passengers

• An increase of 800,000 passengers

Pax (mill) 0.5 0.9 1.5 2.0 2.6 3.1 3.8 4.6 5.2 6.0

0.00

1.00

2.00

3.00

4.00

5.00

6.00

Q3 04 Q3 05 Q3 06 Q3 07 Q3 08 Q3 09 Q3 10 Q3 11 Q3 12 Q3 13

Pass

enge

rs (m

illio

n)

+16 %

10

Europe’s best low-cost airline Highest growth at London Gatwick

MarketshareOslo Airport

(OSL)

MarketshareStockholm Airport

(ARN)

MarketshareCopenhagen Airport

(CPH)

MarketshareHelsinki Airport

(HEL)

Marketshare Int'lGatwick Airport

(LGW)

Marketshare Int'lSpanish bases

(AGP, LPA, ALC)Q3 08 29 % 10 % 2 % 0 % 0 % 2 %Q3 09 35 % 12 % 8 % 0 % 2 % 3 %Q3 10 39 % 14 % 10 % 2 % 3 % 3 %Q3 11 38 % 19 % 11 % 8 % 4 % 4 %Q3 12 37 % 21 % 15 % 10 % 4 % 5 %Q3 13 39 % 23 % 17 % 12 % 6 % 6 %

0 %

5 %

10 %

15 %

20 %

25 %

30 %

35 %

40 %

+ 231,000 pax

+ 212,000 pax

+ 131,000 pax

+ 119,000 pax

+ 243,000 pax + 149,000 pax

• Increasing market share in all Nordic markets

• Norwegian accounted for 90 % of growth at London Gatwick

11

Gatwick total market: +271,000 Norwegian at Gatwick: +243,000

Europe’s best low-cost airline Unit cost excluding fuel down 3 %

• Underlying unit cost down 7 % – Excl. fuel hedge, EUR & USD effect MNOK 65

– Excl. Long-Haul wet lease, fuel & IRR costs MNOK 101

Cost per ASK (CASK) (NOK)CASK ex. fuel 0.29

0.41 0.400.27

0.410.270.41

0.28

0.29

0.27 0.28 0.27

0.11

0.14 0.15

0.13

0.25

0.30

0.35

0.40

Q3 10 Q3 11 Q3 12 Q3 13

Ope

ratin

g co

st E

BITD

A le

vel p

er A

SK (C

ASK)

Fuel share of CASK

CASK excl fuel

-3%

-3%

Other losses / (gains) is not included in the CASK concept as it primarily contains hedge gains/losses offset under financial items* as well as other non-operational income and/or cost items such as gains on the sale of spare part inventory amd unrealized foreign currency effects on receivables/payables and (hedges of operational expenses). *Norwegian hedges USD/NOK to counter foreign currency risk exposure on USD denominated borrowings translated to the prevailing currency rate at each balance sheet date. Hedge gains and losses are according to IFRS recognized under operating expenses (other losses/ (gains) while foreign currency gains and losses from translation of USD denominated borrowings are recognized under financial items.

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• Uniform fleet of Boeing 737-800s • Overheads • 3 new 737-800 delivered in Q3 (13 y.o.y.)

Aiming for FY CASK NOK 0.25 excluding fuel

• Flying cost of 737-800 lower than 737-300 • 737-800 has 38 “free” seats • Unchanged unit fuel consumption in Q3 due

to A340-300 wet lease

Scale economies New more efficient aircraft Growth adapted to int’l markets

Crew and aircraft utilization Optimized average stage length Automation

• Fixed costs divided by more ASKs • Frequency based costs divided by more ASKs • Q3 sector length up by 11 %

• Cost level adapted to local markets • Outsourcing/ Off-shoring

• Rostering and aircraft slings optimized • Q3 utilization of 12.2 BLH pr a/c (+0.3 BLH)

• Self check-in/ bag drop • Automated charter & group bookings • Streamlined operative systems & processes

13


dBGO OSL HEL

TRF

LONDON(Gatwick)

AES

TOS

GOTAAL

SVGARN

CPH

TRD

DBVSPUNCE

IBZ

BCNPMI

ALCAGPFAO

FUETFS

FCO

ACELPA

BUD

CFU

JTRCTA LCALAX

FLL

JFK

In operationCapacity increaseNew S14

London: Growth on short-haul & adding long-haul

14


• JFK with most departures in Norwegian’s long-haul network

• 15 weekly roundtrips from NYC to Europe from summer 14

New crew bases in New York and Florida

15

OAKSan Francisco

LAXLos Angeles

FLLFt. Lauderdale

MCOOrlando

BKKBangkok

ARNStockholm

OSLOslo

CPHCopenhagenJFK

New York

LGWLondon

Europe’s best low-cost airline Competitors are national airlines flying internationally

“Other European Companies” have a very different business model

«Other European companies are capable of coping without creating this kind of creative corporate structures»

Petter Førde, Chairman, Norwegian Pilots Association

Majority of members fly for SAS and other competitors (Mr. Førde flies for Widerøe)

16


1

3W

3

BGO

TRD

13 +2

5

+1

15

+2

SVG

HAU

KRS

AESMOL

4

+1

ANX

EVE

TOS

BDU

+1

5

6

+1

ALF

KKN

LYR

+12

BOO

OSL

TRF

+215

1

S

52

3

2

S

LKL

4

Improved product in all Scandinavian domestic markets

6+1

4

S

6

5

ARN

GOT

MMX

UME

LLA

KRN

VBY

1

+1

Route with more departures S14 vs S13Route with no change S14 vs S13

New daily number of departures

Change from S13 to S14

Weekly number of departures

Seasonal

15

+2

3W

S

17

Europe’s best low-cost airline Current committed fleet plan

18

Deliveries 787-8+1,164 seats

2014:Deliveries 737-800

+2,046 seatsRe-deliveries 737-300

-592 seats


• Wet leased aircraft with 50 % higher fuel consumption per seat

• MNOK 80 in savings - per airplane - per year

Dreamliner saves 40 tons of fuel roundtrip Bangkok

19


• Business environment – Economic uncertainty in parts of Europe

– Seasonal fluctuations

– Yield pressure from capacity investment

• Production

– The company expects a production growth (ASK) of 32% (Previously “in excess of 30%”)

• Increasing the fleet by adding 737-800’s

• Utilization and distance increase short-haul driven by UK and Spanish bases

• Launch of long-haul operations

– Capacity deployment depending on development in the overall economy and marketplace

• Cost development

– Unit cost expected in the area of 0.42 • Excluding hedged volumes

• Fuel price dependent – USD 950 pr. ton

• Currency dependent – USD/NOK 5.75

• Production dependent

• Based on the currently planned route portfolio

Expectations for 2013 (Group)

20


• The company expects a production growth (ASK) of 40 % – Utilization and distance increase driven by UK and Spanish bases and long-haul

– Continuous optimization of the route portfolio

• Unit cost target in the area 0.40

– Fuel price dependent – USD 950 per ton

– Currency dependent ● USD/NOK 6.00 ● EUR/NOK 7.75 ●

– CASK 2014 target approximately 0.385 on 2013 fuel & ccy assumptions

– Production dependent

– Based on the current route portfolio

Expectations for 2014 (Group)

21

From bases in NORWAY From bases in SWEDEN DENMARK

FINLAND

From the UK base From bases in SPAIN

From bases in the USA & THAILAND

Norwegian offers 401 scheduled routes to 124 destinations in

38 countries


23

Documents

Norwegian Air Shuttle ASA · 2015. 6. 29. · Norwegian Air Shuttle ASA Q3 2013 Presentation . Europe’s best low-cost airline ... 400 500 600 700 800 900 1 000 1 100 1 200 1 300