Norwegian reports net loss of $174 million loss for 2019

Embattled carrier Norwegian reported a $174 million loss for 2019 as it reported its fourth quarter and full year earnings, with the firm blaming ongoing problems with the Boeing MAX and Rolls-Royce engines for the poor performance.

Despite this the firm said that it secured significant financial milestones in 2019  that  “strengthened the airline’s move to profitability”. In a statement it cited its internal cost-reduction program #Focus2019, which it said had delivered cost reductions of $248 million or the full year. 

Norwegian also mentioned that the firm the has postponed aircraft deliveries, sold aircraft, sold its shares in Norwegian Finance Holding and sold its domestic operation in Argentina as well as raised new capital to strengthen the liquidity. 

“At the same time, 2019 was a challenging year for the industry marked by a tough trading environment. Significant costs caused by the global grounding of the Boeing 737 MAX and the ongoing Rolls Royce engine issues on the Dreamliner fleet meant the company was forced to wetlease additional aircraft to avoid cancellations and delays throughout the network,” it said in the earnings statement. 

The company’s total revenue in 2019 was NOK 43.5 billion, an increase of eight percent compared to 2018, driven by improved unit revenue and increased ancillary revenue per passenger. 

Norwegian’s shift in strategic focus from growth to profitability resulted in a production growth (ASK) of one percent while unit revenue increased seven percent. The load factor was 86.6 percent and the airline carried more than 36 million customers.  

“2019 marked a new flight path for Norwegian as the company changed its strategy to move from growth to profitability. We have achieved our initial goal to save NOK 2.3 billion as part of #Focus2019 and concluded several positive financial milestones. The focus of returning to profitability will continue as we focus on Program NEXT to build a strong, sustainable and profitable business to benefit our customers, employees and shareholders,” said chief financial officer, Geir Karlsen.