Norwegian Air passenger growth falls

Loss-making airline resists slashing fares to sell tickets

company, abandoned its attempt to buy the firm.

“Norwegian has been through a period with significant growth, but now the company will change its strategic focus from expansion and growth to profitability,” Chief Executive Bjoern Kjos said, echoing recent statements by the board.

The airline has shaken up longhaul rivals by offering cut-price transatlantic fares, but its rapid expansion has left it with hefty losses and high debts, leading it to shift recently to focus on bolstering its finances. For the quarter-to-date, Norwegian Air estimated a gain of NOK 627 million ($73.7 million) from hedging, including NOK 701 million related to unrealized hedge positions.

Norwegian’s yield, a measure of revenue per passenger carried and kilometers flown, grew to 0.35 Norwegian crowns from 0.32 crowns a year earlier. Analysts had expected an increase to 0.33 crowns.

Norwegian expanded its capacity in January by 27 percent yearon-year but revenue-generating passenger kilometers increased by only 18 percent, lagging a forecast of 20.1 percent passenger growth in a Reuters poll of analysts.

The airline’s load factor, a measure of how many seats are sold on each flight, fell to 76.1 percent in January, traditionally a time when travel ebbs following the holiday season. Analysts had forecast a load factor of 79.1 percent compared with 82.0 percent a year earlier.