|Bid||44.56 x N/A|
|Ask||44.67 x N/A|
|Day's Range||44.15 - 45.50|
|52 Week Range||29.24 - 158.73|
|Beta (3Y Monthly)||2.20|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||224.45|
The failure of Boeing’s 737 Max planes will dent public confidence in automated flight for years to come. Low-cost, long-haul carrier Norwegian Air said the grounding of its own fleet would affect results ...
(Bloomberg) -- Bjorn Kjos, a pioneer of low-cost travel as co-founder of Norwegian Air Shuttle ASA, is stepping down as chief executive officer after making progress toward resolving the carrier’s debt crisis.Kjos, who helped found Norwegian in 1993 and led its rapid growth, will leave the post immediately, the company said Thursday in a statement. Chief Financial Officer Geir Karlsen will become interim CEO until a permanent successor is found.A former fighter pilot, Kjos established Norwegian as a major force in the European short-haul market, taking on no-frills giants led by Ryanair Holdings Plc. After that market proved tough to crack, he altered course to target low-cost long-haul flights, challenging giants such as British Airways on trans-Atlantic routes.His heavily discounted fares proved popular with the public but margins were thin and fleet costs stretched the balance sheet to breaking point. Over the past year, Kjos, 72, has tempered growth to stabilize the company and preserve profit.“You shouldn’t lead an airline past your 70s,” Kjos said on a video call after the company reported second-quarter results. “I’m way overdue to retire.”The turnaround picked up pace in the second quarter, as earnings before interest and tax more than tripled to 622.8 million kroner ($73 million). The improvement has been secured by dropping the worst-performing routes, slowing aircraft deliveries and generally reining in the pace of growth. Capacity gained 6% in the period versus a 48% surge a year ago.Still, Norwegian shares declined 5.8% to 42.10 kroner as of 11:48 a.m. in Oslo, dragging the return to negative 69% in the past 12 months, during which British Airways owner IAG SA dropped a takeover bid and a rights offering announced in February diluted equity.Analysts at DNB suggested the CEO change without a permanent replacement, along with further cuts to growth plans and a smaller cash balance than expected, were negatives for the stock and would trigger a revision to full-year earnings estimates. A 700 million-kroner hit from the grounding of the Boeing Co. 737 Max, as well as Norwegian’s low fuel hedges, have also left the carrier exposed, Goodbody analysts said in a separate note.Succession PlanKjos was the driving force behind the airline and “built it from nothing,” said Davy Stockbrokers analyst Stephen Furlong.He has been CEO since 2002, while taking stints as chairman, guiding the company from a regional operator with 130 staff and four planes to a global airline employing more than 11,000 people and operating 162 aircraft.“This was my last presentation, you can be happy with that,“ Kjos said with a wide grin, his arms outstretched. “Geir is awesome,” he said in a subsequent interview.He had been saying for months that he wanted to retire after earnings showed signs of a recovery. Kjos will remain an adviser to Chairman Niels Smedegaard, 57, who plans to take on a more active role as the company shifts its focus toward profitability.The ultimate fate of Norwegian remains unclear, with a report last week suggesting IAG is planning a fresh bid after earlier approaches were rejected -- though the London-based group said that wasn’t the case.Deutsche Lufthansa AG also examined a purchase and the departure of Kjos following the exit in May of his ally, former chairman Bjorn Kise, may stoke further interest among major industry players.“Whether it’s IAG or someone else, all this must be dealt with by the board,” Kjos, a significant owner, told Bloomberg. “We’re just a shareholder with less than 20%, so we’ll follow the stream.“Another major item on the to-do list is securing a joint-venture plan that would bring in new financing for the airline’s fleet and help fund a bond maturity later this year. Interim CEO Karlsen said Thursday that talks on the JV are progressing and the company expects clarity within weeks.“We’ve had many interested parties who wanted to be part of this, and we chose one that we believe is a good fit and has good penetration in Asia, that was a criterion,” Kjos said.(Updates with Kjos interview, analyst comment, from ninth paragraph)\--With assistance from Simon Foy.To contact the reporters on this story: Benjamin Katz in London at email@example.com;Sveinung Sleire in Oslo at firstname.lastname@example.orgTo contact the editors responsible for this story: Anthony Palazzo at email@example.com, Andrew NoëlFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Bjørn Kjos, the co-founder of low-cost carrier Norwegian is to step down as CEO after 17 years in the role. He will be replaced on an interim basis by current chief financial officer Geir Karlsen with chairman Niels Smedegaard also taking on a more active management role. Kjos is remaining with Norwegian and will immediately […]The post Norwegian Air's Long-Serving CEO Departs as Airline Pushes for Higher Profits appeared first on Skift.
(Bloomberg Opinion) -- Silicon Valley startups have long recognized the benefit of having a few grownups in the room to make sure the youthful, idealistic founders don’t forget about the bottom line. At Norwegian Air Shuttle ASA it’s the older crowd you’ve had to keep an eye on. The transatlantic budget airline’s 72-year-old co-founder Bjorn Kjos has been on a breakneck expansion drive over the past few years, but now he’s stepping down after being forced to abandon that high-spending strategy to ensure his company’s survival. Kjos, who’s staying on as an adviser, has been Norwegian’s CEO for 17 years, making him one of the oldest corporate leaders in Europe. A former fighter pilot and lawyer, his achievements are the stuff of industry legend. Norwegian has come from nowhere to now carry about 38 million passengers every year. American customers flying to Europe are its biggest source of revenue. Unfortunately, Kjos had a big weakness: An obsession with growth that almost proved Norwegian’s undoing. In 2012 Norwegian placed Europe’s biggest ever aircraft order, and the pace didn’t let up. Kjos has since opened a subsidiary in Argentina.The growth has taken a huge toll on Norwegian’s balance sheet. The company has 61 billion kroner ($7.1 billion) of net debt and lease liabilities but generates little profit. Forced to raise 3 billion kroner of fresh capital in January, Norwegian’s liquidity and capital base remains thin. Since its shares peaked in 2015, they have fallen 80%. Compared to the colorful Kjos, his interim replacement Geir Karlsen may seem a trifle grey. But the plain-speaking former chief financial offer, who has a degree in business administration, is just what Norwegian needs to win back the trust of the capital markets.While second-quarter revenues and earnings published on Thursday were pretty good, the coming months will be difficult. The airline must repay or refinance a 250 million euro bond in December. Yet credit card companies are making its life difficult by holding back more cash until passengers actually travel (an insurance policy in case it can’t fly at some point). Norwegian’s receivables – the cash expected on ticket sales – ballooned to 12.6 billion krone during the second quarter. That’s almost 50% above a normal level.That pressure should alleviate somewhat as Norwegian’s customers take the flights they’ve booked, allowing the credit card companies to release the money. Norwegian has other ways to raise cash too, including selling airport takeoff slots and divesting its stake in Bank Norwegian AS. Because of the grounding of the Boeing 737 Max, the company won’t have to spend as much this year on new jets and it’s doing a decent job of reining in costs. Details of a long discussed aircraft-owning joint venture remain scant though.The airline now expects passenger capacity to increase by a maximum of 5% this year; indeed it might not grow at all. The Kjos era of more planes, more seats, and more routes appears to be over for now. It’s about time.To contact the author of this story: Chris Bryant at firstname.lastname@example.orgTo contact the editor responsible for this story: James Boxell at email@example.comThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Norwegian Air's Bjoern Kjos stepped down on Thursday as chief executive of the airline he co-founded and turned into Europe's third-biggest budget carrier by passenger numbers. The airline has shaken up the long-haul market with cut-price transatlantic fares, but its rapid expansion has left it with hefty losses and high debts and it had to raise 3 billion crowns ($350 million) from shareholders earlier this year. "I am way overdue," Kjos, 72, laughing, told a news conference, announcing his plans to quit the top job.
Norwegian Air's Bjoern Kjos stepped down on Thursday as chief executive of the airline he co-founded and turned into Europe's third-biggest budget carrier by passenger numbers over more than 25 years. Chief Financial Officer Geir Karlsen will act as interim CEO while the company hires a permanent, new CEO. Kjos, who is 72 and is a major shareholder in the business, will have a new role as an adviser to the chairman.
Norwegian Air Shuttle chief executive Bjorn Kjos declared his departure was “way overdue” as he announced plans to step down after 17 years in the role with a parting warning over company profits. The co-founder of the airline leaves at a difficult time for the group with shares down more than 75 per cent since April 2018 and its finances stretched following bold plans to take on the transatlantic airlines in the long-haul market. Shares traded flat on Thursday as Mr Kjos had signalled his intention to leave the company, the third-largest low-cost carrier in Europe behind Ryanair and easyJet.
OSLO/MADRID (Reuters) - Shares in budget carrier Norwegian Air rose on Friday after British Airways and Iberia owner IAG denied a Spanish media report it was preparing another offer for the airline.
(Bloomberg) -- Want the lowdown on European markets? In your inbox before the open, every day. Sign up here.British Airways owner IAG SA said it has no plans to revive a bid for discount rival Norwegian Air Shuttle ASA following a Spanish report that an offer was likely to be made in the next 15 days.The airline group, which also owns Madrid-based Iberia, intended to make an approach worth about $1.2 billion, according to Okdiario newspaper. That’s based on a share price of 70-85 kroner, almost double Norwegian’s current market value of $652 million. Okdiario said JPMorgan was advising on the deal.“We have said many times in the past few months that we are no longer interested in Norwegian Air,” IAG spokeswoman Laura Goodes said by telephone on Friday. “Nothing has changed.” The stock rose as much 12% despite the denial.IAG, which also owns Ireland’s Aer Lingus and discounters Vueling and Level, attempted to buy Norwegian last year, but abandoned the effort in January. A renewed pursuit would come amid signs it might encounter less resistance from Norwegian’s board, according to Okdiario, which didn’t name sources.Norwegian, which declined to comment, rejected two offers from IAG as undervaluing its business before the London-based company walked away. The discount carrier had become vulnerable amid a cash crunch and mounting losses following one of fastest expansions in European airline history as it sought to extend its low-cost model into long-distance markets.Rights IssueThe Scandinavian company was forced to close routes and sell off aircraft before billionaire John Fredriksen underwrote a 3 billion kroner rights issue in February to shore up its finances, albeit at a steep discount that saw the stock fall 5% on top of a 21% drop when IAG pulled its bid.Bjorn Kjos, Norwegian’s founder and chief executive officer, who turns 73 on July 18, has asked the board to seek a successor, while his long-time ally, chairman Bjorn Kise, retired in May, having been seen as a potential obstacle to any future deal.In an interview at the Paris Air Show on June 18, Kjos told Bloomberg TV that airlines will always be interested in acquiring other airlines, while declining to say whether his own company was in play.Norwegian Air shares traded 4.2% higher at 42.60 kroner as of 9:12 a.m. in Oslo, paring the decline this year to 57%. IAG traded almost unchanged at 458.80 pence and has declined 20%.(Updates with share reaction starting in second paragraph.)To contact the reporters on this story: Sveinung Sleire in Oslo at firstname.lastname@example.org;Christopher Jasper in London at email@example.comTo contact the editors responsible for this story: Jonas Bergman at firstname.lastname@example.org, Anthony Palazzo, Tasneem Hanfi BröggerFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Passenger numbers at Norwegian Air fell 1% year-on-year in June as the budget airline took another hit from the ongoing grounding of Boeing's 737 MAX planes. "The total number of passengers declined slightly in June, due to the grounding of 18 Boeing 737 MAX and less charter capacity," Europe's third-largest budget carrier by passengers flown said on Thursday.
(Bloomberg Opinion) -- If it’s true that all political lives end in failure, then the same could be said for business. Carsten Spohr became Deutsche Lufthansa AG’s chief executive in 2014, made an impressive start, and had his contract extended to the end of 2023. He may regret signing up for that long.The German airline’s shares tumbled 12 percent on Monday after it issued a second profit warning in as many months. It expects to generate as little as 2 billion euros ($2.2 billion) of operating profit in 2019, up to 25% below what was expected by analysts.The stock is now worth less than four times last year’s earnings, a pretty pitiful multiple, and investors who bought the stock when Spohr took over have lost money. Suddenly, a man feted as one of Germany’s most accomplished corporate leaders looks ordinary.How times have changed. Spohr’s response to a 2015 aircraft crash at the Lufthansa offshoot Germanwings was both sensitive and assured. Later on he faced down industrial action to win concessions from staff on pensions. In 2017, Lufthansa’s profit hit a record high and the stock price soared 150%. Spohr was duly named Manager of the Year by Germany’s influential Manager Magazin.Sustaining all of this was always going to be hard in the notoriously unstable airline business. Fuel costs have risen, rivals have added new capacity and air cargo demand has waned, thanks in part to U.S. President Donald Trump’s trade crusades. (It’s worth reading Bloomberg’s William Wilkes on Lufthansa’s litany of problems.)But Spohr can’t just blame external factors. His company has chased growth to the detriment of profitability and it has spent heavily on new jets and integrating older ones from the insolvent Air Berlin. Gross capital expenditure jumped 8% to 3.8 billion euros ($4.3 billion) last year, leaving precious little spare cash.While Lufthansa is still doing fine on long-haul routes, Spohr’s big idea — a budget subsidiary called Eurowings — has been a disaster. The new unit was meant to challenge Ryanair Holdings Plc and EasyJet Plc in Europe, and to serve long-haul holiday destinations, but it lost more than 230 million euros last year. Instead of breaking even in 2019, as was anticipated, it will now remain in the red.Spohr has hit the brakes on Eurowings’s expansion but the company plans to “vigorously defend” its dominant market position in Germany and Austria. Translated, that sounds worryingly like: “Fare war? Bring it on.”Ryanair is pursuing a similar battle of attrition against weaker rivals such as Norwegian Air Shuttle ASA, with the aim of forcing them out of business. But Ryanair’s costs are much lower than those of Eurowings.Of course, Lufthansa can afford a couple of bleak years. At the end of March it had 12 billion euros of net debt, aircraft lease and pension liabilities — or about 2.4 times Ebitda (a measure of earnings). Norwegian’s leverage is miles higher.But when your corporate strategy is all about acquisition (Thomas Cook Group Plc’s German arm could be next on Spohr’s shopping list) and heavy investment, falling profits are doubly alarming. They suggest cash might be misallocated. “We think the sooner the company focuses on value for shareholders and less chasing or defending market share, the better for the shares. We see no hint of that yet,” RBC’s Damian Brewer complained.At an investor event next week, Spohr has a chance to explain how he plans to fly Lufthansa out of this mess. Once seen as a safe steward of Lufthansa’s capital, he’s starting to look a little reckless.To contact the author of this story: Chris Bryant at email@example.comTo contact the editor responsible for this story: James Boxell at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Chris Bryant is a Bloomberg Opinion columnist covering industrial companies. He previously worked for the Financial Times.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
Norwegian Air expects Boeing's 737 MAX aircraft to remain grounded until at least the end of August, missing the European summer season, CEO Bjoern Kjos said on Friday. “If you ask Boeing they still say June or July,” Kjos said at the Paris Air Forum. More than 300 Boeing 737 MAX jets have been grounded worldwide after two fatal crashes in Ethiopia and Indonesia killed nearly 350 people.
Norwegian Air shares rose 28% on Thursday following a report by Spanish business daily Expansion that the budget carrier could again become the target of takeover offers. Britain's IAG, the owner of British Airways, earlier this year sold its stake in Norwegian and said it was no longer interested in an acquisition. Citing "sources in the market", the Expansion report said investors are taking positions in Norwegian Air ahead of a possible takeover.
Norwegian Air filled more seats on its planes and earned higher revenues per customer in April while dealing with the grounding of its 18 Boeing 737 MAX aircraft, it said, sending the company's shares sharply higher in early trade. The company said last month that the global grounding of 737 MAX jets, which followed deadly crashes of airliners in Indonesia and Ethiopia, could scupper Norwegian's plan to return to profitability this year. While analysts had anticipated an income boost, there had been uncertainty about the impact of the 737 MAX groundings, as well as a strike among pilots at rival SAS.
European shares were little changed early on Tuesday with London markets leading losses as investors returned from a long weekend to digest a slew of earnings and watch for developments around U.S.-China trade talks. UniCredit helped lift the Milan index after Italy's biggest bank said it was considering a sale of its FinecoBank unit and had adopted measures to ensure the online broker could operate outside the group. Mobile phone group Cellnex gave a major boost to the IBEX 35 index on news that it had the go-ahead to buy Iliad's mobile tower assets in France and Italy for 2 billion euros ($2.24 billion.
If card providers are worried about a particular carrier’s finances, they can withhold more money on ticket sales from the company, potentially making its liquidity problem worse. Norwegian was forced to raise 3 billion kroner ($350 million) in capital in February to head off a liquidity and capital crunch that was made worse by cautious credit card companies. Receivables — mainly cash due to the company from ticket sales — jumped by more than one-third to an eye-popping 10.7 billion kroner in the first quarter.
Norwegian Air said the grounding of its Boeing 737 MAX aircraft may last until the end of August and could scupper the carrier's plan to return to profitability this year. Boeing's MAX aircraft have been grounded following the crash of a Lion Air plane in Indonesia last October and an Ethiopian Airlines jet last month, which together killed 346 people. The MAX ban will likely raise Norwegian's 2019 costs by up to 500 million Norwegian crowns (£44.8 million), the company said, adding that its efforts to cut other operating expenses were moving at a faster-than-expected pace.