The COVID-19 outbreak has significantly affected the demand for international travel. As travel restrictions have been implemented around the world, Icelandair has relied on the flexibility of its route network and gradually reduced flight capacity based on demand. Today, the Company is operating only 14% of its planned flight schedule, and, in the coming weeks, the capacity is expected to decline even further. The effect of the outbreak has also had a significant impact on the operations of other companies within Icelandair Group, such as its regional airline operation, Air Iceland Connect, and the operation of Icelandair Hotels.
In the last few weeks, Icelandair Group has taken decisive measures to diminish cash outflow across all operations, including renegotiations with suppliers and financial institutions. With salary cost being the single largest cost item, the Company is now taking the following steps today:
All these measures will increase the flexibility of Icelandair Group, decrease cost and improve cash flow. The financial effects of the COVID-19 outbreak for Icelandair Group are still uncertain.
Bogi Nils Bogason, President & CEO of Icelandair Group:
“We are living in unprecedented times where a global pandemic has significantly impacted international travel. Our priority is to secure robust operations of Icelandair Group for the future. The measures we announced today are difficult but necessary to mitigate the impact of the situation on the Company’s operations and cash flow.
The Company has overcome many challenges in its over 80-year history, be it the forces of nature, economic downturns or other external factors. We have always managed to get through such unexpected events with unity, resourcefulness and the unique spirit of the Icelandair employees. I am proud and grateful to be part of such a strong team and I am convinced that we will get through the current challenges now as before.”
Investors: Íris Hulda Þórisdóttir, Director Investor Relations, firstname.lastname@example.org
Media: Ásdís Ýr Pétursdóttir, Director Communications, email@example.com