LONDON – Following the mass views that Norwegian was about to enter a period of unprofitability, the carrier has produced a surprising net profit for the third quarter of 2018.
Norwegian has attracted interest from several potential bidders in the airline industry, with IAG and the Lufthansa Group as the most incumbent.
“Despite being at the peak of our growth phase, we have been able to present a profit and decreased unit costs during the second quarter,” said the airline’s CEO, Bjorn Kjos.
A net profit of 1.3 billion NOK ($155 million) is now official, which is an improvement of 18% compared to the same period last year.
Unit costs, excluding fuel, have decreased by around 10%, with revenues increasing by 33% to 13.4 billion NOK ($1.6 billion).
About 11 million passengers
It seems that the investments Norwegian have made in recent years, featuring new bases and new markets it’s starting to pay off.
The launch of new routes and increased frequencies on existing flights has determined the barrier between loss-making and profit-making.
Kjos also expressed happiness at the results, but a level of reluctance to the results based on the condition of the industry at the moment,
“I am very pleased to present a solid result this quarter with reduced unit cost despite strong growth,” said Kjos.
The CEO did admit that growth will slow down, but the investments made will begin to come through as a positive return.
“Going forward, the growth will slow down, and we will begin to reap the large investments we have made over the years, which will benefit customers, employees, and shareholders.”
The airline’s chief guaranteed that “tough competition, high oil prices, and a strong dollar will affect the entire aviation industry, making it even more important to further streamlining our operations and continue to reduce costs.”
The carrier took delivery of one Boeing 787-9 Dreamliner and four Boeing 737 MAX 8s during 3Q18.
By the end of the year, the airline will take delivery of a total of 11 787-9s, 12 737MAXs and two 737-800s that have already been delivered.
Overall, this is very good news for Norwegian. For now, the carrier can use these results to dismiss its critics like O’Leary and Walsh who have all expressed doubts about the future of the carrier.