Norse Atlantic to lease out six aircraft in bid to raise $462m after poor summer
Gary NoakesTransatlantic budget carrier Norse Atlantic Airways is close to sealing a $462 million deal to lease out six of its aircraft to an unnamed airline after posting another quarterly loss.
Norse, which currently operates 15 Boeing 787s, has signed a "detailed letter of intent" to lease part of its fleet.
Two aircraft will be redeployed in February 2025 and another four in September next year. It will operate its scheduled routes from Gatwick and Europe using its remaining six aircraft, with another three being already leased out.
Norse said: “The agreement as contemplated with this tier one international airline… will represent a new era for the company… leaving Norse with a business model carrying lower market risk.”
The decision follows a third quarter net loss of $6 million in July, August and September, which compares with a profit of $1.6 million last year.
This was despite revenue rising by 8% to $222 million, a 17% increase in flights and an 18% increase in passenger numbers.
Norse said summer yields had “not been at satisfactory levels”, with revenue per passenger falling from $438 last year to $406.
During the nine months to the end of September, Norse has run up a $101 million net loss, which follows a $104 million deficit in the same period last year.
Earlier this year, Norse said it would slim its fleet, review its network and start selling via GDSs to trim its overheads and widen distribution.
Norse has managed to secure a $15 million cash injection; chief executive Bjorn Tore Larsen has increased his shareholding from 18.88% to 29.46% via BTLCo, a company he controls, pumping $8.7 million into the airline.
Another $6.3 million has come from a loan to BTLCo.
Norse’s chair Terje Bodin Larsen said the cash would serve as "a basis to execute on the company’s revised business model".
“The investment demonstrates the commitment and belief by the company’s founding shareholder in our new strategy, to be less dependent on variable revenue by subleasing part of our fleet at favourable terms providing fixed revenue," he said.
Norse also plans to offer 82,800,000 new shares on 20 December. In addition, a $20 million loan has been extended to a final repayment date in March 2026.
In its quarterly report, the Norse board outlined its prospects, saying: “There are scenarios under which the company is fully financed for the next 12 months of operations, whereas there are other scenarios which would require the company to secure additional capital to what now is secured."
Sign up for weekday travel news and analysis straight to your inbox
Gary Noakes
Supplier Directory
Find contacts for 260+ travel suppliers. Type name, company or destination.
Editor's pick
Recommended For You
Latest travel jobs
Self-employed Holiday Sales Consultants
Junior Africa Sales Consultant
Travel Consultant - Barrhead, Newtownabbey
Competitions
Upcoming events
Place of registration: England and Wales.
Company number 08723341.
Registered address: 6th Floor, 2 London Wall Place, London EC2Y 5AU
