NWARF - Norwegian Air Shuttle ASA (NWARF) Q1 2023 Earnings Call Transcript

2023-05-12 12:38:08 ET

Norwegian Air Shuttle ASA (NWARF)

Q1 2023 Earnings Conference Call

May 12, 2023 2:30 AM ET

Company Participants

Jesper Hatletveit - Vice President, Investor Relations

Geir Karlsen - Chief Executive Officer

Hans-Jorgen Wibstad - Chief Financial Officer

Conference Call Participants

Hans-Erik Jacobsen - Nordea

Petter Nystrom - ABG Sundal Collier

Hans Jørgen Elnæs - Winair

Presentation

Jesper Hatletveit

Good morning, and welcome to the First Quarter Presentation of Norwegian Air Shuttle. My name is Jesper Hatletveit, and I'm the Investor -- I'm the VP of Investor Relations here at Norwegian.

Today's presentation will be held by our CEO, Geir Karlsen; and our CFO, Hans-Joergen Wibstad. It will be followed by a Q&A from the audience and the web. Please go ahead, Geir.

Geir Karlsen

Thank you, Jesper. Welcome to all of you guys. Good to see you, and we are very glad that we are kind of done with a low season, at least for this year in Norwegian.

Going through the highlights for the quarter and looking a little bit into the summer season, 3.8 million passengers for the quarter, close to 81% load factor, which is okay. We think it's okay. You have been seeing this winter, probably for the first time in Norwegian that we have been reducing capacity through the low season in a way that we haven't been doing before.

So if you look at -- as you can see on the page here, we reduced the capacity with 13% in kilometers going into Q1. Looking at Q3 last year, we're actually flying more than 30% less capacity in first quarter, compared to the third quarter last year. And that is something you will probably see as well going forward in Norwegian where we are adjusting the capacity in the low season, in line with the demand.

And by doing that, we have actually reduced our losses in the area of NOK500 million to NOK600 million, compared to us flying with more full capacity over the same season. That led us to come out of the first quarter with NOK992 million EBT, to lose NOK1 billion in the quarter is never good, but we are relatively happy with the numbers taking the situation into consideration. We have been doing cash management relatively well over a long period. This is no exception. Even if we have [Technical Difficulty], we have increased our cash position from NOK7.7 billion to NOK8.6 billion. Today, the cash position is higher than the NOK8.6 billion as well.

Looking into the summer, it is looking good. As we all know, we have inflation. We have increased the interest rates and we have a weak local currency in Norway. But even with those kind of issues, we are still seeing a very strong momentum on the bookings into [Technical Difficulty] this year. We have, as we all know, a slight delays from Boeing. We were supposed to get 15 new aircraft during the first-half this year. We will, from Boeing get five aircraft only, but we secured six MAXs in addition to that, so that's why we are happy with the fleet that we are now going into the summer with. And we are only missing now one delivery from Boeing that will take place during the next couple of weeks.

And by that, we can say that we are planning to fly this summer only with Norwegian aircraft, and we are very happy that we don't have to take in that leases that is disruption in the operation as we see it, and what you also saw partly we are doing in 2022. So we are very happy. We have also been using the last months to bring in and to welcome more than 700 new colleagues into Norwegian. This time, it's very well planned in my opinion. We don't have any concerns of these cabin crew and pilots not being ready for the summer season. They're all employed. They're all trained, and they're ready for the summer operation.

We have also in accordance to plan with in-sourcing ground handling in Gardermoen, that has been an important thing for us. First of all, we have taken what we call front of house, which is the customer-facing part of the ground handling, meaning that the people that you will actually meet going to Gardermoen. We did that 22, 23 of March and as per today, that has been a huge success. We are seeing that the punctuality is even higher after the fact that we in-sourced it. You're seeing that this is more organized boarding. We have more control over the different boarding classes. And not at least, we are seeing an increased revenue as well at Gate especially, after onboarding more than 150 people into Norwegian.

We have -- into the summer, we have 300 routes to sale -- for sale to more than 110, 115 destinations. The network is all set. And it's actually looking pretty well. I'll come back to the details a little bit later. On sustainability as well, we have taken action, we have been talking a lot about sustainability over the last months and quarters. Now we're actually doing something about it by investing into Norsk e-Fuel, both as an equity investor and also making an agreement, an offtake agreement for the years to come. I'll get back to the details on that.

Going into the capacity yield and loads. This is showing the reduction we are doing in capacity. And by doing that, you can see on the red line and the blue, black line that we are keeping a relatively constant load and yield. The load is between 78 and 86. The yield is between 0.72 and 0.84. And this is what we are doing in order to keep the loads, keep the yields in a season where the demand is lower. And as I said, this has probably reduced the losses between NOK500 million and NOK600 million.

And now we are in a process where we are ramping up again. You just think about it, guys, in January, we had approximately 1.6 million seats for sale. In May, we have close to 2.5 million seats for sales, so that's how we are adjusting the capacity. And to be able to do that, we are very happy that we have the flexibility on the fleet. And we are also very happy that we have been negotiating good agreements with all our unions, making us able actually to adjust capacity through the seasons, that's a good thing.

Going into the booking. As you can see on the right top corner there, you are seeing that the bookings throughout the winter has been relatively stable. You can also see that the yield is spreading out already back in February, and it has been stable over the last months. Looking at how we are booking compared to last year, for example, we are looking now at an average increase in fares of approximately 25%, compared to 2022. And as you remember, 2022, we're also looking relatively strong compared to 2019.

If you look at the load factors, compared to 2022, we are massively above as per today, but we are not back to 2019 levels yet. One part of the reason for not being back is that we have completely different discipline. Now when it comes to pricing, when it comes to revenue management throughout the winter, and we are much more patient as per today than what we have been before to call it like that. That's why we are also seeing a higher yield into the summer also as a result of that.

On the bottom right side, we are kind of giving you a guidance, some kind of a guidance on the revenue side. The midline there is 2019, that is capacity adjusted. And then the bottom line is 2022, then you can see 2023 how we are doing on revenues. So it's a massive increase, compared to what we have been seeing before. And this is why we are quite optimistic I would say, very optimistic into the coming summer. And we do expect as well that this kind of development will continue, and we don't really see any signs of this coming off, and it certainly looks good.

On the brand side, we have a target to be the most loved and trusted airline in the Nordics. We are on our way to actually becoming it. We are certainly that in Norway. And we are also working on the three other Nordic countries to get into that position. The Wideroe partnership is developing further. As per today, Wideroe is selling Norwegian on the home network, and there is more to come, and we will aim to also be able to sell Wideroe tickets through our own websites during 2024 when we have the IT stack in place in order to be able to do that.

We are working extremely hard on punctuality. We are, by far, the most punctual airline in the Nordics. We have kind of established a difference as per today, compared to our main shareholders in the 10 percentage points area. And we intend to keep that difference. And this is also why an very important factor why we're actually taking market shares also on the corporate side of the business. And those numbers are very, very promising.

We are continuing to receive awards. And the last 1 was the Freddie Awards that we got for just -- I think it was last week. It just shows that was on the loyalty side, and it just shows that we are all the way out there on these ratings as such.

Before I go further, maybe Hans-Joergen, you can go through the figures for the quarter. Hans-Joergen?

Hans-Jorgen Wibstad

Thank you, Geir, and good morning, everyone. I will, as usual, go through the first quarter numbers for Norwegian for 2023. And starting with -- before I go into the P&L in more detail, just to go through some key numbers on the revenue side. Very happy to see that the unit revenue came up 31%, compared with the same quarter last year to NOK 0.63 in the quarter. And we're also seeing that the passenger traffic is up significantly, 64% to 4.9 billion passenger kilometers. So that's a good development and it's driven by our increased capacity compared with the same quarter last year.

Seasonally, of course, as Geir said, we've taken down capacity, but we're seeing that we've been able to finally balance our capacity, but while at the same time, keeping up our offering. Looking at the profit, we are, of course, not very happy to report a negative figure close to NOK1 billion. But as also Geir said, we are relatively happy with the quarter. We were preparing for a quarter, which is seasonally low, but we have been delivering results overall, which is in line with our expectations or even slightly better.

The EBITDA is as also reflected in the figures. The EBITDA has improved from the same quarter last year from minus NOK290 million to minus NOK124 million, which, of course, is still a negative figure. But relative to where we are in the season, it's quite a strong improvement also taking into account that we have increased our capacity and thus having higher fixed cost level.

On the cost side, the unit cost per kilometer is at 0.55, the same level as last year, which take -- also taking into account that our fixed cost base and also taking down capacity is okay on a comparable basis. Having said that, we're not -- we are struggling a little bit, of course, like many players in the industry and generally with both inflation and also the higher U.S. dollar rate. So that is, of course, impacting our CASK. And also the fact that we've taken down capacity also with a higher fixed cost base. That is, of course, relatively speaking, driving CASK up, but it's improving the result. So it's a good decision, but actually, it will impact CASK slightly negative.

Overall, as I said, not very happy to report a negative figure, but at the same time, relatively happy with the quarter overall from a financial point of view. And as we're getting ready for two more very exciting quarters Q2 and Q3. On the balance sheet side, also a good development, we've increased our cash balance from NOK7.8 billion to NOK8.6 billion in the quarter. Despite the operating losses and also taking into account that we have done -- made two extraordinary payments in the quarter. One is the fine that we have actually paid, which is a disputed amount that we have recorded as a receivable in our balance sheet that we had to pay for it before it's taken to court or judge a final decision in court.

The other thing we have also done is to repurchase bonds, the retained bond, and that is a total of the some of the fine and the repayment of the bond is NOK750 million. So that's actually is reducing the cash but still we have successfully increased the cash balance by NOK8.6 billion.

I would also like to say when talking about the balance sheet, very happy to report that we have just signed a loan facility for the NOK500 million loan facility for the financing of the -- of up to 10 of the new aircrafts coming into the fleet for the 2025 deliveries at attractive terms and which gives a good basis for the financing of that fleet renewal, and it's also kind of a stamp of quality from the credit institutions that has provided this loan facility of $500 million.

Digging a little bit more into the P&L. Operating revenues is strongly up by 107% to NOK3.975 billion. Other revenues is impacted by cash points, which we have reported in the report itself, we have taken some of the void on the cash point of that, which is maturing in 2023. So that is somewhat impacting the revenue side. Otherwise, to note on the P&L side, just kind of normal operating expenses. Of course, there is an elevated fuel price, which is also impacting us in the first quarter. Of course, the first quarter in 2022 still had relatively low fuel prices. So that is a factor and also the strong U.S. dollar is impacting the fuel price. But overall, according to plan.

I did make a quick note on the -- we have done a reclassification of heavy maintenance expenses, which we have pushed from technical maintenance expenses to depreciation. So that's very technical, and that's well described in the report itself. So I will not go into any detail, but it has not any impact on the EBIT, but it does have an impact on EBITDA, and that is to align our -- the treatment of our leased aircraft with our owned aircraft. So that is just an important technical adjustment.

Net financial items is significantly down, that's driven by actually the repurchase of NOK475 million of the retained claim bonds. We recorded a small profit also on the repurchase, which we did at 72.5% of par. We have somewhat higher interest income and also a foreign exchange impact on that line, which is helpful for the net financial items, which brings us down to a net result before tax of NOK992 million negative.

This is just for kind of reading for those that are very interested in our reclassification and also there is further information on that in the report itself. But the important thing, it doesn't impact the EBIT. It's just a reclassification between, so we treat leased and owned aircraft the same way.

I talked a little bit about the balance sheet. The balance sheet is increasing by 25% in the quarter, that's driven by an increase in the number of aircrafts by nine from the end of last year to this year -- to the end of this quarter. So you can see that the tangible fixed assets is up from NOK10 billion to NOK13.2 billion. The cash is up. The receivables is up naturally seasonally and -- which is then the main drivers for the increase in the balance sheet. Equity is down naturally as a result of the loss in the quarter. But we're very happy to see that the holdback from the acquirers is down to 32%.

It's -- as some of you may recall, it was above 100% at the end of 2021, and it has gradually come down, which is a key driver for our ability to actually generate cash in the quarter. As we see that the air traffic liabilities has increased from NOK2.5 billion at the end of last year to NOK6.1 billion or NOK6.2 billion at the end of this quarter. So overall, a very, very, I would say, a good development on the balance sheet side, a natural increase in the size of the balance sheet as our fleet increases, and we get more of this kind of right-of-use assets.

Looking at our net interest-bearing debt as a consequence of that, that is going up from NOK2.3 billion to NOK4.1 billion, naturally driven by aircraft financing and right-of-use asset IFRS 16 adjustments. However, looking at our net interest-bearing debt, excluding IFRS 16, excluding the right-of-use assets is actually our net interesting bearing that is coming down by nearly NOK1 billion as our -- as we have repaid some of our bond that I've mentioned a few times and we've also increased our cash balance. So it's important to look at, I think, the net interest-bearing debt, both as reported here, but also kind of taking out the leased aircraft, which is driving, kind of, the increase in the debt level on this chart.

Right, so this is kind of to summarize on the cash flow side. Strong cash development in the quarter despite the losses of nearly NOK1 billion, driven by the forward bookings and reduced holdback from the acquirers down to 32%. We've done some investments, including spare engine. We paid for the aircraft leases. And in total, that brings our cash balance to NOK8.6 billion. And again, to repeat, very happy to announce that we have secured the $500 million loan facility from a reputable financial -- international and financial institution at attractive terms.

So that is, of course, together with what we've already paid in as prepayment for the aircraft, more than NOK3 billion, kind of, provides a solid foundation for the financing of this fleet renewal that will be kicked off in 2025. Okay, thank you. Geir?

Geir Karlsen

Yes. So the way forward, I just want to have add a comment, Hansen. I think some of you might be a little bit disappointed on the high cost for the quarter. I think that is -- I think going forward, I think we will have to accept that in low season, we will have a slightly higher CASK than in the high season. And that is because we are taking out the capacity. But it is making the bottom line massively better by doing that. So that is kind of just a very planned strategy and something you will have to accept also going forward. All in all, it's good for the profitability.

I'm going to spend a couple of minutes on sustainability. We have been talking a lot about sustainability over the last quarters. We have now taken action in a way where we are actually investing into a company called Norks e-Fuel. That is a company that is going to build a facility up in motion, where they're going to produce e-fuel. The company is supported by very solid shareholders and also technology providers. Sunfire, a German company will provide the technology. This is a tested technology. So this is all about scaling it up for production of SAS. And then you have [Indiscernible], which is also a huge company situated in Luxembourg, but mainly in Germany, that will actually build this facility.

We have been agreeing on an offtake agreement with Norsk e-Fuel, and we have also invested approximately NOK50 million into it. And why have we been doing that? Well, because we think it's a good investment. And we would like to take a part of the upside going forward. All going well, the first leader of SAF sustainable aviation fuel will come out of this facility in 2026. And all going well, we will be able then to secure 20% of the SAF we need when we look at the targets of a 30%, 45% reduction in emissions in 2030.

We think that this is a great project. Why are you doing it in motion? Well, you have a community that is extremely supportive. Historically, this community has very cheap electricity, compared to almost wherever in Europe, and it's the perfect place to build a facility like that. So that is something that we are doing. And then we will continue to explore other alternatives.

Before we decided on Norsk e-Fuel, I think we considered 15 other projects, and this is the one we feel most comfortable with, and we think it's absolutely great that this is also taking place in Norway, creating jobs as well in [Indiscernible]. We are also continuing on the ESG commitment. We have, as we have said many times, been setting a target of 45% reduction.

The only way we achieve that is to get going on the production of SAF. SAF today costs approximately 4 times normal fossil fuel. So obviously, this is an issue. And that's why we are pushing as well towards the government in order to get a partnership in place, not only for Norwegian, but for the industry, where we mean that the taxes, we are paying into the government should be turnaround and then incentivizing production of this type of fuel.

We are -- have ordered new aircraft burning less fuel, that's also part of the same strategy. We have been implementing different kind of tools. One is something we call SkyBreathe, which is something the pilots are using, and we are measuring how efficient they are when they are flying on a day-to-day basis, and by that, trying then to reduce the consumption of fuel. 2022, if we took out 17,000 tonnes only on that small little app in itself, but it's just that we are doing whatever we can to reduce.

We have another tool, which gives the aircraft very sophisticated weather forecast, meaning that they can then fly on the right altitude, meaning burning less fuel, et cetera. We're also continuing the long-lasting relationship with UNICEF. And that is kind of a partnership between us and our passengers. The passengers was contributing more than NOK5 million in 2022, which is a great thing.

And we also had this [Indiscernible] plane project this year, where we were flying a brand-new 737 MAX down to Ethiopia, where the whole aircraft was filled up mostly with medicine to children in Ethiopia, a very good project and definitely a project we will continue to support also for the years to come, so that's on sustainability.

Then to the corporate market. The corporate market as we see it today is approximately 70% to 75% back, compared to 2019. If we look at the revenues that we are having in 2023, we are actually above 2019. Yes, we have a higher yield on these passengers, compared to 2019, but we are also definitely taking market share on this area. And that's why we are putting more efforts into actually -- into this area in order then to be more attractive for this segment. I think part of the reason we are gaining market share is the punctuality and the regularity that we have in Norwegian. 99.4% regularity and we have, by far, the best punctuality as well in the Nordics.

We have been promising our customers that the network that we have for sale is a network that we're going to fly and that promise continues as well for the year and for the years to come. We have also been running a campaign smaller to midsized companies. And we are very happy to see that we have more than 900 companies that have signed up during the first quarter. We have been -- we are always trying to get information out of the big corporates. And many of these guys are now saying that you're actually flying more than 50% Norwegian on a daily basis. And that's why we're also saying that the market -- the portion of the revenue coming from this segment has increased by 6 percentage points, compared to ‘19.

On the loyalty side, we have also kind of relaunched the Norwegian reward where we have made it a little bit more easy to understand, and we are also implementing a new tier called Norwegian reward priority. This is what mostly -- this is for the people traveling the most. And if you fly 32 flights on a 12-months rolling basis with Norwegian today, we will throw in all the benefits, including new benefits. And then that is then creating a traveling experience where you are kind of -- it's very smooth. You have priority on customer care. You have priority on check-in, always fast track. You can come first on board, you can bring your luggage and so on, so that we are creating a product that is actually -- that is, in particular, meant for the people that travels the most. And we are also seeing that the number of members in this group at this tier level has increased by 35% just in 2023. So it certainly shows that it is attractive and probably something that a portion of the passengers has been looking forward to.

And then I mentioned earlier the Freddie Awards. And this is just another award that we have been winning this year and is great -- absolutely great. So just to summarize, things are looking good into the summer. We have been through the booking figures. We are -- when it comes to kind of not guiding, but the way we look at it, we are now guiding 32.5 billion kilometers for 2023.

We mentioned CASK a little bit. We have an aim to reduce CASK, be it up to 5%, compared to 2022. The hedge positions, we are 40% hedged for 2023. And we have also put on a portion in 2024. And I have been looking at the consensus numbers, I think it's approximately NOK1.1 billion for 2023 as a whole. Looking at the fuel prices that have come down from, let's say, mid NOK900 to the spot day, which is shy of NOK750.

And looking at the booking momentum that we're seeing for Norwegian, I might wonder whether I think the analysts are one, I can see a few of them here. You have to -- I think you have to look at the numbers one more time. That’s all. Thank you, guys.

Jesper Hatletveit

Thank you, Geir. We then open up for questions, and we'll start with the audience. Please raise your hand and introduce yourself. Start with Hans-Erik.

Question-and-Answer Session

Operator

Q - Hans-Erik Jacobsen

Hans-Erik Jacobsen, Nordea. It seems like traffic is picking up quite significantly during the summer, not only for our Norwegian but for the entire market. Could you comment a little bit on how you view the market balancing now, which is important in order for you to continue to increase the yield and fill up the planes? And also comment on the competitive situation compared to what you experienced before COVID-19?

Geir Karlsen

I think if you look at the markets we are flying, I think -- and what we have been mostly concerned about over the last couple of months, it is city segment, the big cities. And that is from, I would say, at least from Norway, Denmark and Sweden. That market has come up. And that's probably what we are most satisfied with over the last, let's say, two months.

Going down to -- from the Nordics down to the Mediterranean, first of all, Spain is working great, I have to say. And so you could say that the market performing on the negative side, compared to what we would like it to be, is probably domestic. Domestic Norway, partly, domestic Sweden, even more. If you look at Finland, for example, we have reduced capacity in Finland, especially on the domestic side, but that has actually increased the performance in Finland. So Finland today for us is actually okay. It's not great, but it's okay. So I should say that the market that has probably come back the most is actually the city segment over the last couple of months.

If you look at the competitive side, we are seeing that our main competitor, SAS is flying with more capacity than what we had been doing through the winter. And that is putting a pressure actually on the yield, even if the yield is good, actually. Other than that, if you look at the competitive situation, let's say, from September last year until now, it's relatively unchanged, I would say. I mean, what we're actually seeing now, for example, is that -- if you look at Eurowings out of Arlanda for example, it seems like they are actually reducing capacity into the winter season. Ryanair is relatively active domestically in Sweden, maybe putting in an extra tail from four to five, which is something that we just have to handle. But I think if I should move capacity today from 1 part of the market to another one, I will probably fly more south from all the Nordic countries. I don't know if that was announced.

Hans-Erik Jacobsen

Yes. Thank you very much.

Petter Nystrom

Thank you. Petter, ABG Sundal Collier. Three questions from me, I'll start with the first one here. How do you see the risk of, call it, any operational issues entering now the peak season, which then obviously could hit your profitability aircraft, crew issues, resulting in potential wet lease, you mentioned it previously? Any challenges on different airports. How do you see that?

Geir Karlsen

There will definitely be challenges into the summer as it is every year. As I mentioned earlier, I think on the crew side, we're very comfortable. We have the crew we need in place. If we have any issues on the crew side, we might have -- you might be sorry, we are just comfortable on the crew side. On the wet lease, we are not planning to do any wet leases. Why are we saying that? Well, it is because we are now -- we are lacking one aircraft only that is coming directly from Boeing. It will be delivered in May. So we have the aircraft we need as well. We don't anticipate any ID issues as we had last year on more than 150 crew. That is all taken care of. There is no issues there either.

On the airport side, though, we have issues. One is in Paris as we speak. That is a mess and is the option it is a stretch factor and for all of us. How long will that continue? I don't know. But that is one factor. Another airport that is an issue today is Copenhagen, where you have an issue with the air traffic control with Naviair. And that is a concern that might actually last throughout the summer season. We have delays there now in general at the airport. And we are kind of looking into what we can do to mitigate.

We are discussing internally just to be very open about it, should be considered to fight the moments that for part of the production in case this escalates. Right now, it's -- we can handle it, but the capacity is increasing in general in Copenhagen into the next month. So that's probably the biggest concern.

Petter Nystrom

Perfect. Thank you. So the next question, you're guiding unit cost down up to 5%. Will you be able to deliver on that already in Q2? Or is this something that we should see as more back-end loaded?

Geir Karlsen

I think if you look at Q2 and Q3, let's say, if you look at the absolutely peak, which is typically July, we should have a cost below NOK0.40. If you look at Q2 and Q3, that's the target, as you mentioned.

Petter Nystrm

And then finally, on the holdbacks, down to 32%, how much more able to push this down?

Hans-Jorgen Wibstad

I think we've been through a very positive journey of building trust based on our performance and getting pressed from the acquirers, which are financial institutions. This has been gradually coming down to, as you said, to the 32% level. We will continue to work on that. We have established a very strong relationship with these acquirers that we're working on. So the [Technical Difficulty] objective is clearly to drive that down further, but it will not go as fast as we've seen in the last 12-months. But our objective is to drive it further down.

Petter Nystrom

Is there a limit there? How far you can get it down?

Hans-Joergen Wibstad

Zero is, of course, the limit if we were absolutely top-notch AAA credit level or maybe 5% kind of on average. But yes, we could -- we are objective midway to drive it slowly further towards to figure first, 25%, maybe down to 20%. But yes, so it's something we have some goals to achieve.

Petter Nystrom

Thank you.

Jesper Hatletveit

Hans Jorgen?

Hans Jørgen Elnæs

Hans Jørgen Elnæs, Winair. Can you put some color on the booking pattern that you see today compared to last year? Two things, advanced booking, how much earlier are the passenger booking? And do you see any changes in the travel pattern, in particular in the midweek days that is declining, something we see in United States and some parts of Europe too?

Geir Karlsen

If you look at -- and I think it applies to all the markets we are flying in. I think if you look at the booking pattern, let's say, you compare 2019 to 2022, for example, in 2022 the booking curve was much shorter. If you look at 2023, it's approximately in the middle between 2019 and 2022. So it's getting closer to 2019, meaning that the booking curve is actually spreading out a little bit, I think it applies to all markets.

When it comes to weekdays, weekend, as we have been saying before, the weekends has been stretched out, because probably because our ability to work-from-home and all that. So a weekend, it's not Friday to Sunday anymore. It's Thursday to Sunday. It could be Friday to Tuesday. So that is definitely an effect we are seeing. But I think you should say that yes, the booking curve is spreading out a little bit, a little bit back to closer to ‘19. At the same time, we don't have -- as I said earlier, we don't have the load today for the summer season as we had in 2019.

Why is that? Because I just said it has been spreading out. Well, I think we have a better discipline now where we are more patient and where we are not that aggressive trying to push out tickets through the winter at a low yield, as a too low yield that's kind of the balance that we have. We are trying to find.

Jesper Hatletveit

Okay. We then open up for a couple of questions from the web. We'll start with Kenneth Sivertsen from Pareto Securities. Unit cost, I assume this is impacted by lower capacity any indications for 2024 targets?

Geir Karlsen

On the first one, yes, it's impacted by weaker currency and definitely a lower capacity. No, we're not guiding anything for 2024, okay?

Jesper Hatletveit

Okay. I actually think we'll stop there. So thank you for coming, and have a lovely day.

Geir Karlsen

Thank you.

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Norwegian Air Shuttle ASA (NWARF) Q1 2023 Earnings Call Transcript