By Dominic Chopping
Norwegian Air Shuttle saw its third-quarter net profit more than double on the year as passenger demand for air travel grew significantly across all markets through the busy summer travel season.
The low-cost carrier on Thursday reported a net profit of 2.04 billion Norwegian kroner ($182.4 million), up from NOK909.7 million a year earlier.
Total revenue rose 23% to NOK8.78 billion in the quarter as passenger numbers increased to 6.5 million from 6.1 million a year earlier.
The airline said that while current booking trends have slowed in accordance with seasonality, the booking momentum for the fourth quarter is encouraging, both for leisure and business travel.
Visibility for the first quarter of 2024 and thereafter remains limited, as is expected at this time of the year, and while the company hasn’t observed any sign of weakness in forward bookings, it remains mindful of demand uncertainties following a potential deterioration in consumer confidence, it said.
To match production to seasonal fluctuations in demand, Norwegian has reduced capacity by 30% to 40% for the upcoming winter season, compared with the end of the third quarter. For the summer of 2024, it plans to increase its fleet to around 90 aircraft to match the expected high demand for air travel and to benefit from increasing scale.
“I am confident that we are well prepared to enter into the quieter winter trading period with reduced capacity among other actions,” said Chief Executive Geir Karlsen.
For the fourth quarter of 2023 and first quarter of 2024 Norwegian is forecasting a low single-digit percentage capacity growth year-on-year. For the second quarter of 2024, capacity growth is forecast at between 15% and 20%.
At 1102 GMT shares traded 12% higher at NOK9.17.
Write to Dominic Chopping at dominic.chopping@wsj.com
Read the full article here
