At the beginning of the year, the airline announced a restructuring and new funding, though that can only get them so far. In addition to their questionable business decisions, they also haven’t been very fortunate in terms of their fleet consisting largely of 787-9s and 737 MAX 8s, as both of those aircraft types have had major issues. Especially with the 737 MAX groundings.
Norwegian asked for a delay
Norwegian Airlines has asked bondholders for a two-year postponement in repaying $380 million in bonds, only months after it raised an additional $353 million by issuing new shares.
According to CNN, the newly proposed bond offers will be discussed on September 16th. Airlines had hoped for a 737 MAX return as early as October, but new paperwork issues seem to indicate a return no earlier than mid-December, which means the airline remains tied to expensive leasing operations in the meantime. Leasing costs a lot and it can drain them financially.
What Norwegian airlines had to say in a press statement?
“Norwegian’s Gatwick portfolio currently consists of take-off and landing slots which has an independent valuation from a well-reputed third-party in excess of the current nominal bond value for NAS07 and NAS08 of USD 380 million. These are important operational rights for the Norwegian Group, facilitating the feeding of passengers between our European short-haul network and intercontinental long-haul network, an important part of Norwegian’s profitability strategy going forward. Previous transactions in the market demonstrate the ability to monetize on slots at Gatwick.”
Norwegian launched the impressive “long haul low cost” operation. one of the first in aviation history. That effectively inspired airlines around the world to lower long haul prices to follow their example.
We are yet to see has their successful summer season impacted their overall financial state and will they be ready for the slower winter season?