11 FEBRUARY 2019
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A change in strategy from growth to profitability to counter trading losses was announced by Norwegian last week. Chief executive Bjørn Kjos said the airline was taking measures to cut NKr2bn (about £180m) of costs.
Kjos was speaking after Norwegian reported a full-year net loss for the 2018 financial year of NKr1.454bn (£131m), which the company said had been caused by engine issues, fuel hedge losses and tough competition.
“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,” he added.
Norwegian had already announced it was seeking to raise £278m from investors in order to cover financial shortcomings. A statement said: “The key priority going forward is returning to profitability through … measures including an extensive cost reduction programme, an optimised route portfolio and sale of aircraft.”
It wasn’t all bad news. Noting part of the problem in 2018 was costs related to Rolls-Royce engine issues on its Dreamliners, Norwegian said it had now reached an agreement with the engine manufacturer which will have a positive effect in 2019.
Total revenue in 2018 was also 30% up on 2017 at NKr40bn (about £3.6bn).
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