Icelandair Group’s first quarter
net losses have widened by 36.5%, although the company describes its
operational performance as above expectations in the current climate.
the three months ended 31 March, Reykjavik-based Icelandair’s turnover rose 18% to IcKr14 billion
($189 million). Group fuel costs were 56% higher at IcKr2.6 billion and total
operating expenses rose a quarter to IcKr14.9 billion.
fluctuations in flights and tourism led Icelandair
to post a first quarter EBITDA loss, although it deteriorated sharply to
IcKr857 million from IcKr81 million. EBIT losses deepened to IcKr1.7 billion
from IcKr833 million.
Icelandair’s net loss fell 36.5% for
the period to IcKr1.7 billion – though the firm notes the corresponding period
included a IcKr1.2 billion
gain from an aircraft asset sale.
CEO Bjorgolfur Johannsson says: “Icelandair’s operation in the
first quarter was somewhat better than anticipated in much more difficult conditions
than last year. Our backlog in charter operations is good, and the same is true
of the booking position in scheduled airline.
we foresee continued high fuel prices, and we are working on the assumption
that these prices, together with the uncertain economic climate, will impact
demand in airline services and tourism. One of our principal challenges now is
to react to the changed circumstances and prepare the company for a new
Icelandair has revamped it
management structure, recently appointing former group chief operating officer Sigthor Einarsson
as group deputy CEO and Birkier Holm Gudnason as Icelandair CEO. It
has re-entered the travel agency market, put Icelandair Cargo’s growth plans on ice and
negotiated a new short-term wage contract with its airline staff.
Johannsson says: “Through these
and other actions we are solidifying our core operations, reducing risk and
Group for the future.”