On Thursday, the fast-growing budget airline air shuttle beat expectations with a second-quarter net profit. It controlled costs better than expected at a time. Europe’s third-largest budget airline by passenger numbers is trying to crack the transatlantic market by undercutting established rivals but has faced pressure to control costs.
“Revenues came in line with expectations, while costs improved more than anticipated and this was the main reason for the earnings beat. As the company is now at the peak in terms of the capacity ramp – up and growth will slow markedly onwards, we expect ticket price pressure to abate and costs to continue improving” said Pareto Securities analyst Kenneth, who holds a “Buy” recommendation on the stock.
“If we consider selling, I think it is too early for shareholders,” We haven’t even fulfilled our expansion this year. We should go into harvesting mode, so shareholders see what comes out of it.” said CEO and founder Bjoern Kjos.
Kjos and Norwegian Air Chairman Bjoern Kise are the top shareholders in Norwegian Air via HBK Invest Holding which owns around a quarter of the company.
It said it planned $1.75 billion in capital expenditure this year, down from the previous view of $1.9 billion.