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Expanding Norwegian's full-year profit surges

Budget carrier Norwegian has turned in a strong full year, with a four-fold increase in operating profit to NKr1.8 billion ($218 million) and a net profit of more than NKr1.1 billion.

The airline attributes the sharp improvement to its international expansion, notably with long-haul services, and its development in Spain and the UK.

Norwegian’s revenues rose by 16% to NKr26 billion. Operating expenses, including lease, were up by 9% to nearly NKr23 billion.

The airline says it achieved its “best ever” results despite a 3% fall in unit revenues, as unit costs – including fuel – declined by the same level.

Yield for the operator was down by 5%, its financial statement shows.

It hiked capacity over the year by 18% as it acquired 21 new aircraft, while traffic demand enabled it to record a 1.5-point rise in load factor to 88%.

Norwegian has disclosed a fourth-quarter revenue increase of 15% to NKr6.1 billion, and it turned around an operating loss of NKr632 million to post an operating profit of NKr335 million for the three months to 31 December 2016.

Fourth-quarter unit revenues were down 13% and yields sank by 14%, while overall unit costs declined by 2%.

Norwegian’s results for the quarter benefited from a net gain of NKr852 million – compared with a loss last year of NKr515 million – arising from foreign currency translation and forward fuel contracts.

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