It looks like Norwegian wants to push Sissener using the media

Would you call the H1 figures, 1,4 billion NOK loss compared to a 0,3 billion profit last year, also very impressive?
What I call very impressive is the debt which doubled in six months time!
Increasing debt, defaulting bonds, not looking good at all.

The Q3 results will be very interesting. It is difficult to see how the airline will break even, never mind generate the profits needed to see off the duff quarters. Revenues are broadly flat whilst seat costs are expected to be up around 20% on last year.

Like bondholders really have a choice: deny the extension=bankruptcy. All is lost.
Approve the extension=(possible) bankruptcy. All may be lost...

I was thinking exactly the same today. Slots cannot be held as a commodity. They operate on “use it or lose it” basis, so unless they are transferred to another airline they are effectively worthless.

I doubt the bondholders have much choice. It is potentially worthless slots or a worthless bond come December. As Trump once said to his lenders, “ If I owe you a million dollars, it is my problem; if I owe you one hundred million, it is your problem!”

I cannot imagine why the shares are surging at the moment. I would not be touching this company with a bargepole.

Norwegian will deliver according latest analysts from SEB

We will see that when the Q3 figures are presented in October, and the company provides positive guidance for the challenging Q4 and Q1 periods. As the effects of consolidation from growth to profitability begin to hit in full, compensation from Boeing and Rolls Royce comes into account, wet lease of aircraft declines and one scaled-down winter program with its own planes begins, Norwegian will be on its way to profitability. Credit card issuers will release the 70% cash flow plug, provided that Q3 and guiding are delivered beyond expectation, and Norwegian is well placed to renegotiate credit terms. This can give almost normal credit card sales cash flow, when the important sales for the summer season 2020 are launched in late December, thus there will be no credit crunch and working capital under NOK 1.5 billion. The share issue ghost stays in the closet behind a locked door. CEO Geir Karlsen will deliver and had he not had faith in it himself, then the company would have already started a share issue or conversion of debt to equity to secure the company's position for the winter.

That SEB analysis looks a bit suspect IMHO. I cannot imagine how Q3 will “guide beyond expectations” when passengers and revenues are essentially flat (July and August stats) and seat costs are at least 10% but possibly 20% higher than last year (assuming they broadly follow Q1 and Q2 trends). Even then, when Q3 was profitable, the airline reported a robust loss for the year.

Even if the cost savings are realised the airline has a long way to go to break even.

@JonEMA - does this affect more 787s than the ones already grounded? (the article is unclear). If so this is terrible news.

With regards to TCX I don’t imagine there will be much effect as there was little route overlap and whilst TCX did offer seat only, most of its traffic was IT. I would think Tui and Jet 2 will be set to benefit the most.

Norwegian operates a lot of charter flights for Ving, a Scandi branch of Thomas Cook...

In the quoted Times article in post 61, what do they mean by grounding?
Do they expect more groundings in absence of replacement turbine blades, or do they mean grounding as in “downtime” to in install replacement blades which are becoming more and more available due to RR “accelerated efforts”, effectively “ungrounding” the RR 787?

To who? Where did you read this?

To HK based recycler - article on flightglobal.

Cancelling routes left right and centre, defaulting on loans, selling off assers and incurring eye-watering wet lease costs does not add up to a well run and prosperous airline.

Unless Q3 results are spectacular, the airline will not survive the Winter.

A very interesting theory but having done four airline bankruptcy’s I don’t see any of the usual indications of lack of liquidity in Norwegian.

Clearly mistakes have been made and multiple AOC ‘s might spread the financial risk but at the cost of interoperability , this problem is currently being addressed.

luck also plays a part and the problems with both the 737MAX & B787 engines have not helped Norwegan’s problems.

Looking forward it is the recruitment and training of crews to keep the fleet in the air when the 737MAX comes back and the 787 problems are sorted that will become the limiting factor in moving from a just about viable financial position to one of a highly profitable business.

The financial bond holders clearly see things the same way with bonds recently being extended for two years.

As a bond holder if you had payment due would you:

A) call it in immediately with absolutely no prospect of getting any money back due to that action resulting in the company’s insolvency.

Or

B) give extra time for restructuring in the slim hope you might at least get something back on your investment.

No brainer I would imagine? Hence why you can’t really use that as an indicator of decent prospects ahead.

.....not to mention that the bond holders now have the LGW slots as security. Saying yes to an extension was therefore an absolute no-brainer and is in no way an indicator of the company’s future prospects, good or bad.