Losses double to €391m at Norwegian Irish unit

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Losses double to €391m at Norwegian Irish unit


Photo: Bloomberg
Photo: Bloomberg

Norwegian Air International, the Dublin-based arm of the Scandinavian carrier, made a $445.7m (€391.1m) loss last year, almost double the loss it posted in 2016.

The company said the increased loss was primarily due to establishing new bases, and “offerings to customers”, as it increases its presence in the market. The loss was before a $55.7m income tax credit was factored in.

Ticket and ancillary revenue at the Irish unit jumped to $1.94bn (€1.7bn) last year from $1.43bn (€1.25bn) a year earlier.

Its total revenue was just over $2bn (€1.75bn) for the year, when $47m of revenue from leases to other group companies, as well as cargo, are included.

The figures for the Irish division cover flights from Ireland, Edinburgh and Belfast to the US, as well as short-haul services across Europe, including flights to and from the UK.

At the end of 2017, Norwegian Air International operated 12 Boeing 787 Dreamliners leased from its parent, 64 Boeing 737-800 jets and six other 737 aircraft. After the year end, Norwegian Air International sold the commercial interest in the 787 jets to its parent firm, Norwegian Air Shuttle.

In 2017, the parent firm also injected $75m in equity into Norwegian Air International.

The accounts show that Norwegian Air International had 61 employees at the end of 2017, and that its total wage bill for the year was $241m (€211.4m).

That included $179.2m paid to operational staff, and $61.8m for administrative staff.

A spokesman for Norwegian said the Irish subsidiary made planned investments in 2017 to support its global network expansion.

Norwegian has been under pressure from investors to prove that its long-haul, low-cost model has long-term viability.

It posted a net profit of almost €32m in the second quarter, compared to a €73m loss in the second quarter of 2017.

“We’ve reached the peak of our growth phase and we plan to build on the success of our transatlantic routes from Ireland by creating more jobs, introducing more flights and a new route to Canada that will benefit Irish consumers and the wider economy,” said a Norwegian spokesman.

IAG acquired a 4.6pc stake in Norwegian this year with a view to acquiring the carrier.

Irish Independent

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