Q1 Results CEO Comment

"Due to seasonality, the first quarter results generally show an after tax loss, however Icelandair Group‘s operations were better than anticipated.  The most decisive factor was that the performance of the largest companies in the Group, the Icelandic airline Icelandair and Travel Service in the Czech Republic, was considerably in excess of expectations; Icelandair has not returned a better EBITDA in the first quarter since the company was formed in its current form in 2002.  Also, the operation of Loftleidir-Icelandic exceeded expectations. On the other hand, the operation of SmartLynx in Latvia was less successful than we had hoped.

In the difficult environment of our home market and abroad we have managed a defensive victory in the operations of most of the companies within the Group. Our streamlining efforts returned successful results and played a major role in the satisfactory operation of our companies across the board. 

Icelandair Group has been working in close co-operation with its partner bank on restructuring its finances; these efforts have shown good progress.  The objective of our work has been to adapt our outlays to the cash flow returned by the Group over the long term.  We are anticipating the completion of these efforts over the coming weeks, and at the end of April we finalised the extension of an ISK 2.5 billion loan for a period consistent with the projected completion of our restructuring efforts.

We are still facing significant global economic uncertainties which could impact the demand for airline and tourist services.   Uncertainties relating to exchange rates and access to capital contribute to even more difficult conditions.  On the other hand, our charter flight situation is favourable at this point in time, and the Icelandair booking status for the summer is good.  This is cause for cautious optimism, and in any case all changes bring with them some opportunities.  Our staff have been indefatigable in looking out for new opportunities throughout this period, and Icelandair's Seattle flights, starting in July, is a case in point.  The new route will strengthen the pillars of Icelandair‘s network while at the same time creating jobs for our crews and supporting staff."