NORWEGIAN AIR SHUTTLE ASA ANNUAL REPORT 2016 2016-NORWEGIAN.INDd • CREATED: 09.10.2014 • MODIFIED: 06.04.2017 : 19:44 ALL RIGTHS RESERVED © 2017 TEIGENS DESIGN NORWEGIAN ANNUAL REPORT 2016 Help | Contents | Highlights | Letter from CEO | Board of Directors' report | Financial statements | CSR | Corporate governance | Board and management | Definitions | Contact | 02 / 99 IPDF USER GUIDE This document is an interactive PDF (iPDF). It works as a regular PDF, but has interactive functions for navigation. For a printer friendly version, see under “printing version” below. NAVIGATION You can navigate the document by clicking on menus, buttons, hyperlinks or the tables of contents. 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Download the free Adobe Reader here: http://get.adobe.com/uk/reader/otherversions 2016-NORWEGIAN.INDd • CREATED: 09.10.2014 • MODIFIED: 06.04.2017 : 19:44 ALL RIGTHS RESERVED © 2017 TEIGENS DESIGN NORWEGIAN ANNUAL REPORT 2016 Help | Contents | Highlights | Letter from CEO | Board of Directors' report | Financial statements | CSR | Corporate governance | Board and management | Definitions | Contact | 03 / 99 CONTENTS Norwegian Air Shuttle ASA HIGHLIGHTS 04 Visiting address: Highlights 2016 04 Oksenøyveien 3 Key figures – financials 05 NO-1366 Lysaker Key figures – operation 06 Postal address: P.O. Box 115 LETTER FROM CEO 07 NO-1330 Fornebu Switchboard: +47 67 59 30 00 Telefax: +47 67 59 30 01 BOARD OF DIRECTORS' REPORT 09 www.norwegian.no FINANCIAL STATEMENTS 22 Group financial statements 23 Notes to the consolidated financial statements 27 Financial statements for the parent company 60 Notes to financial statements of the parent company 64 Auditor's report 79 CSR 83 CORPORATE GOVERNANCE 89 FINANCIAL CALENDAR 2017 BOARD AND MANAGEMENT 93 Interim report Q1 2017: April 27 The Board of Directors 93 General shareholder meeting: May 9 The Management team 95 Interim report Q2 2017: July 13 Interim report Q3 2017: October 26 DEFINITIONS 98 Norwegian Air Shuttle reserves the right to revise the dates. CONTACT 99 2016-NORWEGIAN.INDd • CREATED: 09.10.2014 • MODIFIED: 06.04.2017 : 19:44 ALL RIGTHS RESERVED © 2017 TEIGENS DESIGN NORWEGIAN ANNUAL REPORT 2016 Help | Contents | Highlights | Letter from CEO | Board of Directors' report | Financial statements | CSR | Corporate governance | Board and management | Definitions | Contact | 04 / 99 HIGHLIGHTS Highlights 2016 Key figures – financials Key figures – operation HIGHLIGHTS 2016 Ä Final approval for NAI by the US Department of Transportation (DOT) Ä SkyTrax awards 2016 for World’s Best Long Haul Low-Cost Airline (second time) and Europe’s Q1 Q2 Best Low-Cost Airline (fourth year in a row) New routes 1 New routes 13 Ä Startup of low-cost long haul between Passengers (million) 5.8 +17% Passengers (million) 7.7 +11% US and Paris Aircraft utilization (BLH) 10.7 0.0 Aircraft utilization (BLH) 11.6 (0.3) Ä Launched new crew bases in Rome and Palma New aircraft 6 New aircraft 6 Average spot fuel price USD 341 (42%) Average spot fuel price USD 406 (31%) Ä Norwegian Reward reached five million members USD/NOK 8.64 +11% USD/NOK 8.25 +6% Ä Added 17 new 737-800 aircraft and four 787-9 Dreamliners to operations Ä Delivery of the first two Airbus 320neos to be leased out Ä Ordered 30 Airbus 321LR (long range) aircraft for Q3 Q4 delivery in 2019-2021 by converting orders for New routes 5 New routes 15 320neos Passengers (million) 8.6 +12% Passengers (million) 7.2 +18% Ä Norwegian Air Resources (NARH) merged with Aircraft utilization (BLH) 11.7 (0.7) Aircraft utilization (BLH) 11.2 0.0 OSM Aviation to form a leading, full-service crew New aircraft 5 New aircraft 6 management company Average spot fuel price USD 444 (18%) Average spot fuel price USD 460 (2%) USD/NOK 8.32 +1% USD/NOK 8.39 (2%) For detailed information, see Board of Directors' report on page 10. 2016-NORWEGIAN.INDd • CREATED: 09.10.2014 • MODIFIED: 06.04.2017 : 19:44 ALL RIGTHS RESERVED © 2017 TEIGENS DESIGN NORWEGIAN ANNUAL REPORT 2016 Help | Contents | Highlights | Letter from CEO | Board of Directors' report | Financial statements | CSR | Corporate governance | Board and management | Definitions | Contact | 05 / 99 HIGHLIGHTS KEY FIGURES – FINANCIALS Highlights 2016 Key figures – financials Key figures – operation 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 Operating revenue (NOK million) 26 055 22 491 19 540 15 580 12 859 10 532 8 598 7 309 6 226 4 226 EBITDAR (NOK million) 5 958 3 694 1 184 2 784 1 822 1 540 1 175 1 341 200 504 EBITDA (NOK million) 3 116 1 481 (662) 1 500 789 710 397 721 (208) 208 EBIT/operating result (NOK million) 1 820 348 (1 411) 970 404 416 210 572 (338) 134 EBT (NOK million) 1 508 75 (1 627) 438 623 167 243 623 5 113 Net profit/loss (-) 1 135 246 (1 070) 319 457 122 189 446 4 85 Basic earnings per share (NOK) 31.75 6.99 (30.42) 9.15 13.08 3.53 4.97 13.01 0.15 3.77 Diluted earnings per share (NOK) 31.47 6.92 (29.89) 9.02 12.99 3.47 4.87 12.89 0.15 3.77 Equity ratio 11% 9% 9% 19% 20% 22% 27% 32% 28% 22% Cash and cash equivalents (NOK million) 2 324 2 454 2 011 2 166 1 731 1 105 1 178 1 408 608 501 Unit cost (CASK) 0.41 0.42 0.42 0.42 0.45 0.46 0.46 0.49 0.56 0.53 Unit cost (CASK) excluding fuel 0.32 0.31 0.29 0.29 0.31 0.32 0.34 0.38 0.37 0.40 ASK (million) 57 910 49 028 46 479 34 318 25 920 21 958 17 804 13 555 11 530 7 561 RPK (million) 50 798 42 284 37 615 26 881 20 353 17 421 13 774 10 602 9 074 6 059 Load factor 87.7% 86.2% 80.9% 78.3% 78.5% 79.3% 77.4% 78.2% 78.7% 80.1% Passengers (million) 29.3 25.7 24.0 20.7 17.7 15.7 13.0 10.8 9.1 6.9 Internet sales 75% 77% 82% 80% 78% 82% 87% 88% 87% 86% Number of routes (operated during the year) 472 447 402 391 308 271 249 206 170 114 Number of destinations (at year end) 130 138 130 125 121 114 97 93 87 70 Number of aircraft (at year end) 118 99 95 85 68 62 57 46 40 32 2016-NORWEGIAN.INDd • CREATED: 09.10.2014 • MODIFIED: 06.04.2017 : 19:44 ALL RIGTHS RESERVED © 2017 TEIGENS DESIGN NORWEGIAN ANNUAL REPORT 2016 Help | Contents | Highlights | Letter from CEO | Board of Directors' report | Financial statements | CSR | Corporate governance | Board and management | Definitions | Contact | 06 / 99 HIGHLIGHTS KEY FIGURES – OPERATION Highlights 2016 Key figures – financials Key figures – operation ASK ASK PER QUARTER UNIT COST UNIT COST PER QUARTER ■■ ASK in million (left axis) ASK in million (left axis) ■ 2015 ■ 2016 ■■ Unit cost excluding fuel in NOK Unit cost excluding fuel in NOK ■ 2015 ■ 2016 ■ Load factor % (right axis) Load factor % (right axis) ■ 2015 ■ 2016 ■■ Fuel per unit in NOK Fuel per unit in NOK ■ 2015 ■ 2016 % % . % % . % % . % % . % ­ % . % % . % % . % % . % ­% . % % . . % % . '07 '09'08 '10 '11 '12 '13 '14 '15 '16 Q1 Q2 Q3 Q4 ' ' ' ' ' ' ' ' ' ' Q Q Q Q RASK RASK PER QUARTER BLOCK HOURS BLOCK HOURS PER QUARTER ■■ RASK in NOK (left axis) RASK in NOK (left axis) ■ 2015 ■ 2016 Hours per day Hours per day ■ Stage length in km (right axis) Stage length in km (right axis) ■ 2015 ■ 2016 ■ 2015 ■ 2016 . . . . . . . . . . ­ . . . . . . . . . . . . . '07 '09'08 '10 '11 '12 '13 '14 '15 '16 Q Q Q Q ' '' ' ' ' ' ' ' ' Q Q Q Q 2016-NORWEGIAN.INDd • CREATED: 09.10.2014 • MODIFIED: 06.04.2017 : 19:44 ALL RIGTHS RESERVED © 2017 TEIGENS DESIGN NORWEGIAN ANNUAL REPORT 2016 Help | Contents | Highlights | Letter from CEO | Board of Directors' report | Financial statements | CSR | Corporate governance | Board and management | Definitions | Contact | 07 / 99 LETTER FROM CEO DEAR SHAREHOLDERS Another eventful year has passed. 2016 has been a year characterized by major "A growing population and international expansion, record-high passenger figures, the establishment of more international bases and several new routes to exciting destinations on both sides of the increased globalization will Atlantic. New passengers have flown with us for the first time as we have continued our global expansion. Hundreds of wonderful and talented colleagues joined Norwegian in lead to more mobility and create 2016 – and many more will join us in the years to come. more demand for air travel" KEEPING COSTS DOWN – FOR THE POWER OF GLOBAL EXPANSION THE PASSENGERS AND FOR THE Our global expansion will be more important ENVIRONMENT than ever this year.