Norw egian Air Shuttle ASA (NAS) Q4 2004 and FY 2004 17 February, - - PowerPoint PPT Presentation

Norw egian Air Shuttle ASA (NAS) Q4 2004 and FY 2004

17 February, 2005 Oslo

2

Strong grow th continued

• 73 % production increase from Q403 to Q404, with up to 40 %

increase on main domestic routes.

• Satisfactory load factor levels maintained
• Strong performance on international routes

349 370 642 683 607

0 % 20 % 40 % 60 % 80 % 100 % Q4 03 Q1 04 Q2 04 Q3 04 Q4 04

Load factor

ASK LF

mill

PAX (000)

427 398 572 549 554

3

Stronger market position

• Approaching 30 % market share on key domestic routes
• Positive response on improved time table for Bergen and

Trondheim

22 % 21 % 20 % 18 % 27 % 26 % 23 % 26 % 30 % 30 % 24 % 28 % 10 % 15 % 20 % 25 % 30 % 35 % Bergen Trondheim Stavanger Tromsø

Q2 03 Q2 04 Q4 04

4

28% increase in turnover

• 331 MNOK in turnover in Q4 2004, compared to 258* MNOK in Q4

2003

• EBITDA result of -43 MNOK in Q4 2004, compared to 0,5* MNOK in

Q4 2003

• A period of extraordinary events; high fuel prices and price war

100 150 200 250 300 350 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04 MNOK

EBITDA MNOK (Low fare 2003)

0,5

• 50
• 36
• 11
• 43

Revenue development *Low fare operation

5

Financial position

• Cash-balance of 195 MNOK, prepaid tickets of 109 MNOK
• Equity-share of 35%
• Strong sales in beginning of 2005 will increase cash balance

CASH FLOW (MNOK) From: Q4 04 2004 2003 Operation activities

• 24 660
• 90 847

61 498 Investments

• 16 037
• 11 964
• 28 637

Financial activities 902

• 16 069

217 938 Net change

• 39 796
• 118 879

250 799 Opening balance 234 953 314 036 63 237 Closing balance 195 157 195 157 314 036

6

Capacity expansion continues

Grow th 04-05

• Sept. 02
• Sept. 03

Number of passengers 65 879 129 298 Fleet 6 8 Airborne hours (ABH) 769 1 311

• Avail. Seat Kilom. (mill ASK)

57 119 Man-years 254 300 Passenger traffic (mill RPK) 29 77

• Sept. 04

11 2 355 224 400 Number of routes 4 17 184 043 141 31

• Sept. 05(E)

13 ~3 100 ~290 ~490 ~265 000 ~200 ~40 23 % 30 % 32 % 18 % 44 % 42 % 30 %

7

Continued cost reduction

• Average unit costs of 0.62 NOK in Q4 2004, down 17 % from Q4

2003 (0.74 NOK)

• 22 % down from 2003
• Higher crew and fleet utilization from production increase,

renegotiated supplier agreements and cheaper distribution will bring costs further down in 2005

0,20 0,30 0,40 0,50 0,60 0,70 0,80 Q4 03 Q4 04 2003 2004 2005 Target* 2006 Target NOK/ASK

• 16%
• 22 %

*Target after planned 2005 production expansion, commencing Q2 05

8

True low -cost operator

Cost per ASK vs Stage Length

KLM

lberia Ryanair SAS Lufthansa Air France Easyjet Norwegian 2003 Norwegian 2004 Norwegian 2005

200 400 600 800 1000 1200 1400 1600 1800 2000 20 40 60 80 100 120

øre km

Footnotes: Total cost pr ASK, incl. leasing costs Source: Annual reports and airline analysis 2002/2003.

”Low-cost quadrant”

9

Tow ards normalized price levels?

Consumer price index, domestic air-fares

90 100 110 120 130 140 150 160 170 j a n . 9 9 a p r . 9 9 j u l . 9 9

• k

t . 9 9 j a n . a p r . j u l .

• k

t . j a n . 1 a p r . 1 j u l . 1

• k

t . 1 j a n . 2 a p r . 2 j u l . 2

• k

t . 2 j a n . 3 a p r . 3 j u l . 3

• k

t . 3 j a n . 4 a p r . 4 j u l . 4

• k

t . 4 j a n . 5 Consumer price index, domestic air-fares KPI Totalindex

3 competitors 2 competitors monopoly 2 competitors

Source, SSB

10

Yield has improved

• Yield levels influenced by shorter sector lengths
• Yield pressure softened somewhat during Q4
• Positive effects from improved revenue management practice

0,20 0,40 0,60 0,80 1,00 1,20 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04

NOK Yield (Rev / RPK)

Yield (Revenue/RPK)

11

Expectations for 2005

• Continued market increase from low prices
• Price competition at current levels
• Fuel prices at current levels
• Continued expansion expected to strengthen market position and

achieve cost level targets from Q2 and onwards

• Expected loss in Q1 and positive operating results from Q2 and
• nwards

Norw egian Air Shuttle ASA (NAS) Q4 2004 and FY 2004