Norwegian Air’s loss widens to £460 million in the fiscal first half
- Norwegian Air’s loss widens to £460 million in the fiscal first half.
- The budget airline says it now seeks to secure additional funding.
- Norway's largest air carrier hopes to restore its full capacity by 2022.
In a report on Friday, Norwegian Air (OTCMKTS: NWARF) revealed its loss to have widened to £460 million in the fiscal first half (H1). The airline said it now seeks to secure funding to cushion the economic blow from COVID-19. The new financing, it added, will support it for a minimum of 1.5 years. In related news, Virgin Atlantic Airways secured £1.2 billion from creditors earlier this week.
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Norwegian Air says five of its aircraft will resume flying in September
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Norwegian Air said another five of its aircraft will return for commercial flights in September. In the winter season this, however, an up to 115 of its jets will still remain grounded. In February, Norwegian was reported considering accepting payments in cryptocurrency for its tickets.
Earlier this year in May, the control of Norway’s largest airline landed with Creditors and lessors that resulted in £260 million of state-backed loans. The financial support rescued the company from going out of business amidst COVID-19 that brought the global travel and tourism industry to a near halt in recent months.
According to CEO Jacob Schram:
“Given the current market conditions it is not enough to get through this prolonged crisis.”
As per the company, it is exploring a few options to secure new financing, including government support, investments from owners, additional debt deferrals, and aircraft sale. CFO Geir Karlsen highlighted in a statement on Friday that Norwegian Air is not currently short of cash. The funding, he added, will help when the need arises in the next 6 to 7 months.
Norwegian Air hopes to restore its full capacity in 2022
The air carrier’s £460 million loss in the first six months of the current fiscal year came in a little under 300% higher as compared to the comparable period of 2019. Norwegian’s long-haul routes are still suspended, and the low-cost airline has not revealed plans of relaunching them any time soon.
As of June end, Norwegian’s debt and liabilities were valued at £6.13 billion versus £7.50 billion last year. As per the airline, its monthly cash burn lies in the range of £34.19 million to £42.74 million. Norwegian aims at restoring its full capacity in 2022.