Norse Atlantic, the long-haul budget carrier is set to return three Boeing 787 aircraft to lessors in a move to save money as losses continue to amass in its latest results.
The company which was founded by CEO and major shareholder Bjørn Tore Larsen in March 2021 has just released its 2024 second-quarter results that demonstrated airfares were lower in the over-saturated long haul trans-Atlantic market which had a negative impact on its revenues and resulting loss.
From the end of May, Norse increased its fleet of own-operated aircraft from 10 to 12 after taking delivery of two 787-9s from sublease as planned. The airline is now negotiating with lessors or three Boeing 787-8 Dreamliners to return the planes ahead of the lease expiry date to cut costs and operate an all 787-9 fleet,
Norse reported available seat kilometres was up 105%, with the number of flights increasing 89% and passengers were up 99% compared to the second quarter of 2023, while the load factor increased by seven percentage points to 82%.
Another area for development for the carrier to help cut costs was to agree on improved terms with credit card payment providers and agree to distribute its services on GDS systems, which will allow leisure and business travel agents easy access to booking flights for customers. that had effect from August.
Bjorn Tore Larsen said: "We are making an important improvement to our distribution strategy and will join the Global Distribution System (GDS), where we expect to be available in 2024. Once on the GDS, our inventory will be available to be sold by corporate and leisure travel agents globally, significantly increasing the population that will be able to purchase our great value tickets with Norse. We will remain steadfast that the cheapest tickets will always be on our website.
Revenue was up in the ACMI and charter flying area which the company will further exploit during the second half of the year, which it hopes will continue to improve as it talks with other airlines for long term placements. "Norse is currently in negotiations with several airlines regarding multi-year contracts for fleet allocation, some of which would have an impact from the end of 2024 if they materialize." Bjorn Tore Larsen said.
Key figures....
Revenue increased by 65% to USD 164.8 million406,306 passengers carried in Q2 2024, up 99%Load factor increased by seven percentage points to 82%Revenue of USD 380 per passengers during quarter, compared to USD 425 in Q2 2023Continued revenue growth from ACMI and charterNumber of flights operated during quarter was 1,531, up 89%Strong operational performance as 99.5% of planned flights were completed during the quarterLower unit cost with CASK ex fuel being down 35%Total cash held at end of quarter was USD 23.7 millionRevising business strategy, aiming to secure long-term charters and significant cost reductionsImproved credit card terms secured post quarter-endExpect to be available on GDS in 2024
