Norwegian Air has posted a loss for the first quarter, with rising fuel costs partially offsetting the positive impact of increased bookings as international travel continues to pick up.
Earlier this month Norwegian said passenger numbers rose by 50% in April, with the firm ramping up operations following the removal of Covid-19 restrictions by most countries. The carrier also confirmed that ticket yields, which are a key indicator of profitability, grew by 21% in the same period.
“The increase in bookings ahead of the summer season is significant,” Norwegian CEO Geir Karlsen said in a statement.
Despite the positives though, the budget airline announced a net loss of 1 billion Norwegian crowns (approximately $100m) through the first three months of 2022, with the first half of that period marked by much stricter pandemic restrictions brought on by the spread of the Omicron variant.
With Covid fears easing, the next challenge to face the aviation industry is rising fuel prices following the Russian invasion of Ukraine.
“The increase in fuel prices is expected to partly offset the company’s positive recovery,” Norwegian said.
The budget carrier, however, booked a net loss of 1 billion Norwegian crowns ($101.82 million) for the January-March period, which was dented by Omicron-fuelled lockdowns.
Norwegian commenced bankruptcy proceedings at the end of 2020, after struggling to deal with the continued impact of public health measures. The firm emerged from those proceedings as a slimmed-down version of its former self, with a reduced fleet and ending long-distance routes.
The airline has been slowly rebuilding since, and recently announced plans to expand its fleet for the first time since the enforced downsizing.