Norwegian is strengthening its balance sheet through a fully underwritten rights issue of three billion NOK in order to increase its financial flexibility and create headroom to the covenants of its outstanding bonds. The company has during the past years made considerable investments in new aircraft and launched a wide range of new routes, not least intercontinentally. The growth will now abate and the profitability increase.
«Norwegian has been through a period of significant growth. Going forward, we will see an increased focus on cost savings and CAPEX reductions. We will now get in place a strengthened balance sheet that supports the further development of the company. We are very pleased to see that our main shareholders offer strong support in a time where the market is still challenging. With the strengthened balance sheet, the organization can now devote all its attention to further development of the company,” said CEO Bjørn Kjos of Norwegian.
A series of initiatives will contribute to reduced cost:
- Aircraft divestments, including establishing a joint venture for aircraft ownership
- Postponement of aircraft deliveries
- The extensive cost reduction program, #Focus2019, will contribute to estimated reduction of minimum NOK 2 billion in 2019
- Optimization of the base structure and route network
- The agreement with Rolls-Royce related to compensation for the operational disruptions on its long-haul operations
The additional capital of three billion NOK will be raised through a fully underwritten rights issue, which will be voted on during an extraordinary general meeting on February 19, 2019. In connection with the fully underwritten rights issue, the company will publish its Q4 2018 results on February 7, 2019. The traffic results for February 2019 will be published on March 11, 2019.
CEO Bjørn Kjos will be available for the media at Norwegian’s Headquarters in Oksenøyveien 3, Fornebu, Norway from 9:30am to 10:00am on Tuesday. No other interviews will be conducted.
For more information, please read the notice to the stock exchange here.
Norwegian is a listed company on the Oslo Stock Exchange and is the world's fifth largest low-cost airline operating 500 routes to 150 destinations in Europe, North Africa, Middle East, Thailand, Caribbean, the U.S and South America. In 2017, Norwegian carried around 37 million passengers. Norwegian has almost 11,000 employees and a modern, environmentally friendly fleet of more than 150 aircraft with an average age of 3.7 years. Norwegian has been voted ‘Europe’s best low-cost carrier’ by passengers for five consecutive years at SkyTrax World Airline Awards from 2013-2017, along with being awarded the ‘World's best low-cost long-haul airline’ in 2015, 2016 and 2017.
For more information, visit www.norwegian.com