Continued from page 64


Leadsom, who was also party to the Flybe rescue, was replaced at BEIS by Alok Sharma, who will take responsibility for approving any loan to Flybe as part of the same agreement. Connect Airways is believed


to be seeking a £100 million loan and BEIS is exploring potential guarantees and commercial terms for any loan. Home secretary Priti Patel


remains in post, but with a new minister for immigration, Kevin Foster. The government has


signalled it will introduce a new immigration regime from next January, with a points system and a minimum salary requirement for entry to the UK. There is widespread concern in the inbound and hospitality sectors at the implications for recruitment. There was no change at


the Department for Transport (DfT), where Grant Shapps remains transport secretary. Rachel Maclean, Kelly Tolhurst and Andrew Stephenson joined the DfT as ministers, with a new aviation minister to be confirmed as Travel Weekly went to press. There was no change at the


Foreign Office, where Dominic Raab remains foreign secretary, but the reshuffle saw the entire team of junior ministers at the Department for International Development taking on joint roles with the Foreign Office. There was no change


at the Department for the Environment, which is responsible, among other things, for pet travel overseas. Former tourism minister


Helen Whately, who took the role only in September, moved to the Department of Health & Social Care.


Air Italy to cease trading two years after its formation


Milan-based Air Italy will go into liquidation next week following a decision by shareholders including Qatar Airways. Air Italy was created from


former Italian regional carrier Meridiana in late 2017, following a restructuring that saw Qatar Airways take a 49% stake – the


62 20 FEBRUARY 2020


Norwegian’s losses rise despite ‘operating result’


Ian Taylor


Norwegian Air reported a doubling of its “underlying operating result” to NOK 6.5 billion (£536 million) in its full-year results for 2019. However, the carrier’s net losses


rose by 11% year on year to NOK 1.6 billion (£131 million) and its debt increased from NOK 32 billion to more than NOK 58 billion (£4.8 billion). The airline acknowledged


credit-card acquirers continue to withhold payments. It reported: “The company is continuing its financing


activities directed towards releasing liquidity from credit card acquirers.” Norwegian carried 36 million


passengers in 2019 and its annual revenue rose 8% to NOK 43.5 billion (£3.6 billion) despite a reduction in capacity. Yet the airline reported an operating profit of NOK 856 million (£70.5 million). Chief financial officer Geir


Karlsen said the carrier cut NOK 2.3 billion (£190 million) in costs over the year, noting: “The company has postponed aircraft deliveries, sold aircraft, sold its shares in Norwegian Finance Holding and sold its


domestic operation in Argentina, as well as raised new capital.” He said figures were “negatively


impacted by the global grounding of the Boeing 737 Max and ongoing Rolls-Royce engine issues on the Dreamliner fleet, [which] meant the company was forced to wet-lease additional aircraft”. Norwegian has 18 of the


grounded 737 Max aircraft in its fleet and more on order. Passenger numbers in January


were down 25% year on year and capacity 29%. This compared with a 6% year-on-year fall in carryings and a 3% drop in capacity in the 12 months to January. Karlsen insisted Norwegian


aimed to make a profit in 2020. Almost one-fifth of the carrier’s


Norwegian Air


revenue was generated in the US, narrowly behind its biggest market Norway – reflecting its increasing refocus on transatlantic services. Spain and the UK were Norwegian’s next-biggest markets, accounting for 14% and 10% respectively.


maximum allowed under EU rules. The carrier began operating in


2018 using Milan Malpensa airport as a hub and offering regional flights and long-haul services. It grew to become Italy’s


second-largest carrier and a launch customer for the Boeing 737 Max aircraft, which has been grounded since last March. However, Air Italy lost €164 million in 2018 and €200 million in 2019. The carrier also ran into


objections from major US airlines, which accused Qatar Airways of using Air Italy to expand in the US


Air Italy


market, allegedly contravening a US-Qatar open-skies agreement. Flights will cease on February 25,


with passengers booked beyond that date told to request refunds.


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