Tag: turnaround

Norwegian Air’s Shares Jump as Turnaround Takes Off

February 6, 2020 / WIL BALDWIN

OSLO (Reuters) – Norwegian Air’s turnaround gathered pace last month as the budget carrier removed unprofitable routes from its network and boosted the income from remaining flights, sending its shares up almost 6% in early trade.

The airline’s yield – income per passenger carried and kilometre flown – rose 15% to 0.40 Norwegian crown ($0.0435), its monthly traffic report showed on Thursday, beating a 0.37 crown forecast in a Reuters poll of analysts.

The company cut its capacity by a bigger-than-expected 29% in January from a year earlier. Analysts had expected a 22.2% decline in capacity for the month.

Norwegian’s shares traded 4.3% higher at 39.66 crowns by 0839 GMT, but are still down 46% in the last 12 months.

“I am pleased that we continue to deliver on the strategy of moving from growth to profitability,” Chief Executive Jacob Schram, in office since the start of the year, said in a statement.

Norwegian has shaken up the transatlantic travel market with low fares, but breakneck expansion and the grounding of its Boeing MAX fleet also brought mounting losses, forcing the company repeatedly to raise cash from owners.

Seeking to turn itself around and avoid joining the ranks of collapsed airlines, the company announced in October it would cut its capacity by 10% in 2020 from 2019.

Another measure, revenue per available seat kilometre, or RASK, grew by 22% year-on-year to 0.32 crowns, beating the 0.30 crowns predicted by analysts, and Norwegian also raised its fuel hedges to guard against a spike in prices.

The increase in RASK pointed to better operating margins at the carrier, said Danske Bank analyst Martin Stenshall, who holds a buy recommendation on the stock.

Norwegian on average filled 80.9% of seats in January, up from a load factor of 76.1% a year ago and beating an average forecast of 80.6%.

Routes between Ireland and the United States and Canada were cut from Norwegian’s schedule last September, and in December the company announced the sale of its domestic business in Argentina.

The cutbacks may also alleviate the pressure on rivals such as Scandinavian Airlines, which now faces less head-to-head competition on routes between Europe and the United States.

($1 = 9.1879 Norwegian crowns)

(Editing by Gwladys Fouche and Barbara Lewis)

Norwegian Air Sweden Boeing 737-800 plane SE-RRJ approaches Riga International Airport in Riga

United Beats Wall Street Expectations Despite 737 MAX Delays

January 21, 2020 / WIL BALDWIN

CHICAGO (Reuters) – United Airlines Holdings Inc <UAL> on Tuesday beat Wall Street estimates for quarterly profit and held to its 2020 profit target, with a turnaround strategy overseen by its outgoing CEO underpinning growth even as the Boeing 737 MAX remains grounded.

Chicago-based United is one of three U.S. airlines cancelling more than 1,000 monthly flights in a hit to profits as the 737 MAX remains grounded following two deadly crashes in Indonesia and Ethiopia. Boeing Co <BA> said on Tuesday it does not expect approval for the 737 MAX’s return to service until mid-year, later than previously forecast.

While United has warned of a hit from the MAX grounding, it did not disclose any estimated financial impact from the fallout and stood by its full-year adjusted EPS range of $11 to $13.

Total operating revenue rose 3.8% to $10.89 billion, boosted by strong travel demand and Chief Executive Oscar Munoz’s three-year strategy to build up the airline’s flight connections through its main U.S. hubs. United President Scott Kirby will succeed Munoz as CEO later this year.

Revenue per mile flown, a closely watched industry measurement, rose 0.8% in the fourth quarter and United forecast similar growth in the first quarter given solid bookings.

However, unit costs excluding fuel and profit-sharing expenses, a concern for investors in a year of contract negotiations with pilots, rose 2.7%.

United had already announced a non-cash impairment charge of $90 million in the fourth quarter related to its Hong Kong routes, following anti-government protests in the city.

Shares of United closed 4.4% lower at $85.79 before the earnings release, tracking sharp declines for U.S. airline and travel stocks on concerns over the Wuhan coronavirus in China, which J.P.Morgan analyst Jamie Baker said poses a near-term overhang for airlines.

United did not comment on the outbreak in its results but separately said there is no impact on its operations and it remains in close contact with U.S., Chinese and other Asian authorities on safety.

United management will host a conference call to discuss results on Wednesday at 10:30 a.m. EST (1630 GMT).

Adjusted net income rose to $676 million, or $2.67 per share, in the fourth quarter to Dec. 31, from $657 million a year earlier, topping a Wall Street consensus forecast for $2.65 per share.

Fellow U.S. MAX operators Southwest Airlines Co <LUV> and American Airlines Group Inc <AAL> are due to report quarterly results on Thursday.

The three airlines are scheduling without the MAX until early June though that timeline will likely need to be pushed back following Tuesday’s guidance from Boeing.

United, which had 14 737 MAX jets in its fleet at the time of the grounding, said it plans to take delivery of 28 MAX variants in 2020 depending on U.S. regulatory approval and Boeing’s subsequent pace of production and deliveries.

Among other aircraft orders, it expects to take delivery of two Boeing 777-300’s and 15 Boeing 787’s in 2020 but has decided to assign its purchase obligations for 20 Embraer 175’s to one of its regional partners once each jet is delivered.

(Reporting by Tracy Rucinski in Chicago; Additional reporting by Dominic Roshan K L in Bengaluru; Editing by Matthew Lewis)

An American Airlines Boeing 737 MAX 8 flight approaches to land at Reagan National Airport in Washington

Vodafone Extends Tech Partnership with Ryanair

November 19, 2019 / WIL BALDWIN

FILE PHOTO: Different types of 4G, 5G and data radio relay antennas for mobile phone networks are pictured on a relay mast operated by Vodafone in Berlin

LONDON (Reuters) – Vodafone <VOD> has secured a seven-year technology partnership with Ryanair <RYAAY> to handle services including online booking, passenger boarding and in-flight transactions for the Irish airline in Europe.

The two companies said on Wednesday they had extended an existing partnership for Vodafone Business to support 300 Ryanair sites and some 153 million passengers across 40 countries.

As part of the agreement, the British mobile company will help Europe’s biggest budget airline to speed up the time it takes to connect a new airport or site for use. It should also lead to a faster turnaround of planes.

“Airline passengers will demand even more in the coming years, and we will work alongside Ryanair to help them prepare for the future using our full portfolio of products and services,” said Vinod Kumar, head of Vodafone Business.

Vodafone Business is the mobile operator’s enterprise arm that offers cloud IT services and the connection of unlimited devices on its Internet of Things network for small and multinational companies.

Vodafone Business accounted for 30% of group service revenue in its financial year ending March 31, 2019.

(Reporting by Kate Holton; Editing by Mark Potter)

Collins Aerospace to Support F-35 and CH-47F Fleets for Royal Netherlands Air Force

August 19, 2019 / WIL BALDWIN

Craig Bries, vice president and general manager, Avionics Service and Support for Collins Aerospace and Lieutenant General J.D. Luyt, Commander of the Royal Netherlands Air Force, commemorated the collaboration at a signing ceremony earlier this year.

Collins Aerospace to establish first-of-its-kind F-35 pilot readiness center
Onsite field service engineers will reduce turnaround time for CH-47F fleet

CEDAR RAPIDS, Iowa (Aug. 19, 2019) – Collins Aerospace Systems, a unit of United Technologies Corp. (NYSE: UTX), will play an important role in maintaining the readiness of the Royal Netherlands Air Force (RNLAF) F-35 and CH-47F fleets by providing local field service engineers, test capabilities and the first F-35 global pilot readiness center. The company recently signed a multi-platform Letter of Intent with the RNLAF to provide support at both Soesterberg, and Woensdrecht Air Base, The Netherlands.

A highlight of the Letter of Intent is that it foresees a first-of-its-kind pilot readiness center that would provide on-location helmet fitting, flight simulators and altitude chamber training for F-35 pilots. In addition, Collins Aerospace intends to provide local field service engineers and test capabilities at the Woensdrecht Air Base to reduce turnaround time on CH-47Fs and maintain the RNLAF fleet’s readiness levels. Collins Aerospace has an unmatched level of expertise on both platforms as the original equipment manufacturer for the avionics suite of the CH-47F Chinook, and components in the F-35 Helmet and flight simulator.

“Collins Aerospace and the RNLAF are working toward a common goal of supporting the new F-35 pilot readiness center and maximizing the availability of CH-47F avionics,” said Craig Bries, vice president and general manager, Avionics Service and Support for Collins Aerospace. “Our legacy as an avionics leader makes us the perfect partner to help ensure these fleets are ready at a moment’s notice.”

Work to establish the pilot readiness center, and to place local support personnel, is slated to begin in early 2020.

Etihad Reports 3rd Consecutive Loss, Jobs & Aircraft Cuts

March 14, 2019 / WIL BALDWIN

ABU DHABI (Reuters) – Etihad Airways on Thursday reported its third consecutive annual loss despite finding cost savings of nearly half a billion dollars as it cut its workforce and fleet.

The Abu Dhabi state-owned airline blamed challenging market conditions including higher fuel prices for a $1.28 billion (965.2 million pounds) loss in 2018, narrower than the $1.52 billion it lost in 2017.

Etihad, which has trimmed its ambitions to be a major intercontinental airline to focus on point-to-point flights, has made losses of $4.75 billion since 2016.

Revenue fell nearly 4 percent to $5.86 billion last year, compared with the $6.1 billion it reported for 2017.

The airline launched a five-year turnaround strategy in 2017, the year current chief executive, Tony Douglas, was hired.

“In 2018, we continued to forge ahead with our transformation journey by streamlining our cost base, improving our cash flow and strengthening our balance sheet,” Douglas, said in a statement.

Etihad said it slashed costs by $416 million in 2018, or 5.5 percent, as it cut its workforce by 5 percent to 21,855.

The number of passengers carried fell by 4.3 percent to 17.8 million as it cut the number of aircraft in its fleet by nine and stopped flying to several routes it said were unprofitable.

Etihad has been rethinking its business since 2016 after piling billions of dollars into a failed strategy of buying minority stakes in other airlines.

Dozens of aircraft orders with Airbus and Boeing worth billions of dollars have since been canceled.

(Reporting By Stanley Carvalho; editing by Emelia Sithole-Matarise)

Norwegian Air’s Shares Jump as Turnaround Takes Off

United Beats Wall Street Expectations Despite 737 MAX Delays

Vodafone Extends Tech Partnership with Ryanair

Collins Aerospace to Support F-35 and CH-47F Fleets for Royal Netherlands Air Force

Etihad Reports 3rd Consecutive Loss, Jobs & Aircraft Cuts

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