Norw egian (NAS) Norwegian Air Shuttle ASA Oslo, 13. July 2006 Q2 - PDF document

Norw egian (NAS) Norwegian Air Shuttle ASA Oslo, 13. July 2006 Q2 2006 Bjørn Kjos (CEO)

Strong revenue grow th in Q2 ● 765 MNOK revenue in Q2 2006 ● Revenue growth of 44 % since Q2 2005 MNOK revenue 800 700 600 CAGR 56 % 500 400 300 200 100 0 Q2 03 Q2 04 Q2 05 Q2 06 Revenue 215 311 531 765 Earnings after tax -10 -27 15 18 EPS -1,18 -1,99 1,68 1,76 2

Stable margin ● EBITDA of 35 MNOK in Q2 2006 ● Earnings after tax 18 MNOK (15 ) ● Margin is stable, taking in the production growth Q204 Q205 Q206 EBITDA MNOK EBITDA MARGIN 40 7 % 5 % 3 % 20 1 % -1 % 0 -3 % -5 % -7 % -20 -9 % -11 % -40 -13 % EBITDA MNOK EBITDA margin % Revenue 311 531 765 EBITDA MNOK -36 31 35 EBITDA margin % -12 % 6 % 5 % 3

Challenging quarter ● Promotional prices on 16 new routes – 11 introduced in May ● Passenger traffic and regularity affected – Airport security and ATC irregularities Q2 Development 25,0 84 % 82 % 82 % 20,0 80 % 80 % 15,0 78 % 10,0 76 % 75 % 5,0 74 % 0,0 72 % -5,0 70 % April May June CABINFACTOR EBITDA 4

Other revenue key contributor ● Contributes strongly to bottom line results ● Increased 58 % since Q205 EBITDA MNOK 30 On-board sales Overweight Other revenue Other revenue Commission Hotel & Car-rental 20 Service fees 10 0 Q2 05 Q2 06 5

Strong cash flow from advanced bookings ● Positive cash flow from operation of 141 MNOK ● Investments Aircraft purchase ● Cash and equivalents 535 MNOK Operating activities MNOK 200 180 160 CASH FLOW (TNOK) Second quarter From: 2006 2005 140 Operating activites 141 493 61 438 120 Investments -128 525 -13 579 100 Financial activities -4 - 80 60 Net change 12 963 47 858 Opening balance 522 538 185 572 40 Closing balance 535 501 233 431 20 0 Q1 Q2 Q3 Q4 2005 2006 6

Capacity grow th on track ● 41 % increase in production from Q205 to Q206 ● Load factor leveling out at 80 % (still available seats!) M ASK 1400 85 % 84 % 83 % 82 % 81 % 1200 80 % 79 % 78 % 77 % 76 % 1000 75 % 74 % 73 % 72 % 71 % 800 70 % 69 % 68 % 67 % 66 % 600 65 % 64 % 63 % 62 % 61 % 400 60 % 59 % 58 % 57 % 56 % 200 55 % 54 % 53 % 52 % 51 % 0 50 % Q2 03 Q2 04 Q2 05 Q2 06 ASK Cabin Factor 7

Strong passenger grow th ● Approaching 9 000 passengers per employee (7 000) ● 50 % passenger growth on international routes Thousand pax 49 % 1300 1100 52 % 900 110 % 700 500 300 100 Q2 03 Q2 04 Q2 05 Q2 06 PAX (000)* 273 572 868 1 289 *Tickets sold for travel 8

Enhanced competitive position ● 38 % market share on key domestic routes, 7 pp growth ● Capacity increased by 16 % since Q205 % Market Share 45 % 40 % 35 % 41 % 30 % 40 % 35 % 34 % 34 % 33 % 25 % 27 % 26 % 20 % Bergen Trondheim Stavanger Tromsø Q2 05 Q2 06 9

Strong revenue grow th, both domestic and international ● Domestic turnover increased by 36 % since Q2 2005 ● International turnover increased by 53 % since Q2 2005 MNOK 450 400 350 300 250 200 150 100 50 0 Q2 04 Q2 05 Q2 06 Turnover domestic Turnover abroad 10

Still a guarantor for low fares ● Domestic prices are down 5 % Q206 compared to Q205 ● International fares are down due to promotional pricing and competition on new routes Norwegian's average ticket price - index (Q1 03 = 100) 100 80 60 40 Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04 Q1 05 Q2 05 Q3 05 Q4 05 Q1 06 Q2 06 Domestic International 11

CASK INCREASED DUE TO FUEL AND IRREGULARITIES ● Unit costs of 0.55 NOK in Q2 06 ● Cost level affected by higher fuel prices and one offs - Given same fuel price level as Q205, EBITDA of 75 MNOK in Q206 ● Cost initiatives on track; - Amadeus, apprentice program, handling and utilization Engine overhaul CASK ATC irregularities 0,55 EU refunds from irregularities 0,55 One offs 0,53 0,01 Added fuel cost Aircraft damaged at Sola airport 0,03 Fuel Wet lease due to late aircraft arrival 0,50 0,51 0,45 0,40 Q2 05 Q2 06 12

Increased fleet and crew utilization ● Aircraft utilization of 10,5 block ● Crew utilization of 785 block hours per plane per day, up 9 % hours per crew per year, from Q2 2005 (9,6) up 3 % from Q2 2005 (761) Block hours/plane/day Block hours/crew/year 11 900 10 800 9 700 8 600 7 500 400 6 Q2 04 Q2 05 Q2 06 Q204 Q205 Q206 13

Product advancement Flexibility Possibility Fairly pricing Availability 14

Leading Nordic LCC Leading Nordic LCC 81 routes

Expectations for 2006 Expected business environment : ● Increased competition on international routes ● Continued price competition on northbound routes ● Continued irregularities on OSL and ATC Expected results (ex start up in Poland) ● Q2/Q3 06 total unit cost in the range of NOK 0,53+ – At current fuel and currency level ● Increased handling costs in Q3 06 ● Improved margins for the year (however further increase in fuel prices may change margins for the year) Expected results Poland start up ● Poland base is not expected to be profitable in 2006, due to start up costs and low introductory prices. ● Two aircraft operation is expected to produce 275 MASK in 2006 and 600 MASK first full year 16

- and fly Norw egian! Thank you,