Icelandair Group hf. - Company Announcement

Icelandair Group and Boeing have signed a commitment for new aircraft

Icelandair Group and Boeing have signed a commitment for 12 737 MAX8 and
737MAX9 aircraft with purchase rights for additional 12 aircraft. 

This is a new variant of the Boeing 737 aircraft which will first enter service
in 2017. The first delivery to Icelandair is scheduled for the first half of
2018. 

The commitment is for 8 737 MAX 8 aircraft for 153 passengers in Icelandair‘s
setup and 4 737 MAX 9 aircraft which hold 172 passengers. In comparison
Icelandair‘s current Boeing 757-200 hold 183 passengers. 

The commitment for all 12 aircraft is valued at $1,2 billion, or ISK 180
billion at Boeing list prices, but actual purchase price is confidential. The
plan is to fund the acquisition partly by internal resources of the Company and
partly by commercial banks.  The Company is in discussions with Export-Import
Bank of the United States about possible financing support.  According to the
Company's projections the acquisition will not affect the Company's dividend
policy. 

Boeing 737 MAX is a new, improved and longer reaching version of the present
Boeing 737. The 737 Max incorporates new engines to deliver efficiency and will
see 13%, per seat,  fuel-use improvement from today‘s aircraft. Fuel savings
compared to Icelandair present fleet of Boeing 757 is more than 20% per seat. 

Boeing 757 will continue to be Icelandair´s future aircraft, with the addition
the new aircraft, as it suits the carrier‘s North Atlantic network reaching
both Europe and North America, perfectly. The new aricraft will be a great
addition to the fleet and increase flexibility and capability for growth. The
737Max can reach destinations on both sides of the Atlantic and gives
Icelandair new options for added frequency and destinations, especially in
winter to even out seasonality. 

“This commitment is the result of our research into what aircraft manufacturers
have on offer to help us strengthen and grow our fleet and our network towards
the future. We have had a successful relationship with Boeing for decades and
we are pleased to continue our cooperation for years to come”, says Björgólfur
Jóhannsson, Icelandair Group president and CEO 

Icelandair Group will hold a meeting for media and investors at 12.00 today,
Thursday December 6th at Icelandair Reykjavik Natura Hotel. 





For further information please contact:

Bjorgolfur Johannsson, President and CEO, tel: + 354 896 1455
Bogi Nils Bogason, CFO, tel: + 354 665 8801.