Norse Atlantic As

Welcome to North Atlantic Airways Q1 presentation 2024. Today we are quite appropriately in New York. This is the biggest airport in North's network and we are flying daily to London, Paris, Rome, Athens, Berlin and Oslo. The year 2023, we flew almost 1 million passengers, and in 2024, we aim to fly more than 50% above that. So we'll see approximately 1.5 million passengers flying with the Norse aircraft. Q1 isolated, we had about 200,000 passengers, and our revenues were almost double compared to Q1 last year. The load factors also went considerably up from 54% last year in Q1 up to 73% this year. And also at higher average ticket prices than we were able to achieve last year. So the average ticket price was up 45% if you are counting both the ticket price itself and the ancillary revenues. Talking about ancillary revenues, we increased those by 48% per passenger from Q1 this year to Q1 last year. And we are now probably the airline in the world with the highest ancillary revenue per passenger. Keeping our cost low is an important part of our business model. And we were able to reduce our cost, our unit cost in 2024 Q1 compared to last year by 28%. And we did that at the same time as we were able to increase our revenue cost per unit from last year to this year with about 14%. And on top of that, or perhaps because of that, we have a very strong operational performance. We completed 100% of all the flights that we were scheduled to fly in Q1. And of course, our aim every day is that no flight shall be canceled. So far this year, we had zero cancellations. Leave the word to Anders.

Thank you, Bjørn Torre. Quarter one, 2024, we reported total revenues of $78.2 million. This is up 97% compared to the same quarter last year. It reflects the increased capacity of 72% higher available seat kilometers compared to last year. Revenues per passengers were up 30%. And the load factor increased from 54% quarter one last year to 73% same quarter this year. The operational costs have increased proportionally to the offered available seat kilometers in the market. And this leads us to a negative EBITDA of $27.4 million, but which is still $5.6 million better than the same period last year. The variable aircraft leases That is basically what is paid to the lessors under the power by the hour agreements, which is still valid for a number of the aircraft, was $4.2 million in the quarter. And as per the IFRS accounting rules, the remaining leasing costs are here in the income statement represented as depreciation, amortization, and net finance costs. In aggregate, $31 million. But keep in mind that as much as 8.5 million of this is actually non-cash. And this leads us to a bottom line loss of $62.8 million for the quarter, but still better than what we achieved in the same quarter last year. Looking at the cash flow, we have positive operating cash flow of $3 million in the quarter, assisted by positive working capital movements of $33 million. We have investing cash flows of $9 million, and we have spent $15 million on financing cash flow, which leads us to a total net change in free cash, a reduction of $20 million in the quarter, bringing the cash down from $54.8 to $33.2 million as we exited quarter one. As the activity now is increasing and we are ramping up for a hectic summer season and where we see both revenues and costs increasing, we have secured a revolving credit facility of $20 million, giving us a good buffer in this hectic period. And looking at the balance sheet, I did mention the cash position of $33 million. Also worth noting is the credit card receivables of $112 million. which then should be compared on the liability side of the balance sheet to the $105 million of deferred passenger revenue. This is basically our liability to the passengers for the tickets booked but not yet flown. Lastly, we do have a reported negative book equity of $146.5 million. But again, keep in mind, this includes aggregate revenues. non cash lease accounting cost of $149 million. And also, you should take into consideration the positive net present value of the favorable leasing terms, which brings the value adjusted equity in totality well into positive landscape.

So we are a very optimistic company and our strategy is evolving every day. In a nutshell, we have two seasons. We have the summer season and the winter season. In the summer season, we are flying like a normal airline, where we are selling tickets on scheduled routes between popular destinations, mainly in America and Europe, but also to some extent to Africa and Asia. And we see that we have evolved the network into a network that is now... maturing and getting more traction and higher fill rates. In the wintertime, we are more of a charter airline. We do fly some scheduled routes, particularly to sunny destinations. And we see that the destinations we have picked have become very popular. So we see a good trend also going forward. But a large portion of our production is actually chartering out our aircraft to other airlines on ACMI basis or chartering it out to tour operators or cruise companies and also to governments and other organizations that want to charter a whole aircraft for a number of charters or single charters. And our activity this year will increase by roughly 20%, taking in two more aircraft going from 10 to 12. And next year, another 20% going from 12 to 15 aircraft. We do that at the same time as we are continuing our negotiations with other airlines for strategic partnerships. And we are doing good progress and we'll come back to the market when we have more concrete things to report. The revenue side, of course, is very important for us. I mentioned the strategy of scheduled and charters. And the booking so far this year is good. The summer seems to be very strong in terms of load factors and revenues. And also the scheduled flights we're doing for the winter is promising. Some of the new routes we have put on sale are selling very, very well. So we're optimistic about those. But also the charter side are off to a very good start. We have already sold more charters for next winter than we were able to fly for the entire season of 23-24. So the revenue side we are looking at with comfort. The cost side is also a continued focus for us. Our durable competitive advantage will be to have low cost compared to our competitors. We have the lowest capex in the industry for the type of aircraft we have. We have a very focused lean business model, and we're also operating one type of aircraft that enables us to have lower unit cost than competition. But cost is an area where you sort of cannot stop focusing. You have to be on the ball every day, and we are chasing ways where we can become more efficient. And that includes quite heavy investment in technology that gives a very quick payback, both in terms of reducing cost and in terms of revenues. All that leads us to what is our aim, and that is to have a profitable airline, and we are aiming for a profitable 2024. So thank you very much for watching our Q1 presentation. We will be very happy to answer any questions you may have, and you can direct them to the investor relations department at the mail addresses you see on the screen. Thank you very much.