Icelandair Group hf. - Company Announcement

Continued growth in international flights in 2017

  -- Passenger numbers projected at 4.2 million
  -- Capacity increased by about 13% between years

It is expected that Icelandair, a subsidiary of Icelandair Group, will see its
international flight schedule in 2017 expand by approximately 13% from 2016.
The number of passengers is projected at 4.2 million in 2017, an increase of
approximately 450 thousand from 2016.  Two new destinations will be added,
which will be introduced in the coming weeks and flight frequency increased to
several gateways in both North America and Europe. Two 262-seat Boeing 767-300
aircraft will be added to the fleet and a total of 30 aircraft will be used in
the Route Network next summer. The increase is expected to result in a
continued growth of the Icelandic tourist industry, strengthening the
operations of other subsidiaries of Icelandair Group. 

It is projected that available seat kilometres will increase by 13% next year,
while the number of flights will increase by 8%. The difference is due to the
increased weight of longer flights to North America in the schedule and the
increased use of larger aircraft. Next year the fleet will include four
262-seat Boeing 767-300 aircraft and 26 Boeing 757 aircraft. 

The scope of the international Route Network has multiplied since 2009. In that
year passengers numbered approximately 1.3 million, or 30% of the number
projected for 2017. The Route Network has been built mainly around the hub at
Keflavik International Airport, with morning flights to cities in Europe and
afternoon flights to North America. In recent years the Company has been
building up a secondary bank of flights with departures to North-America just
before noon and midnight departures from Iceland to Europe. This development
will continue next year. 

Björgólfur Jóhannsson, President and CEO: “As stated in our interim report for
second quarter, average airfares have been declining and the Company therefore
lowered its EBITDA guidance in July. However, we expect the operating results
for 2016 to be one of the best in the Company´s history. The Company is
therefore well positioned to handle the continued organic growth which is
planned for 2017.” 



For further information, please contact:

Björgólfur Jóhannsson President and CEO, Icelandair Group, tel. +354-896-1455
Bogi Nils Bogason, CFO, Icelandair Group, tel. +354-665-8801.
Birkir Hólm Guðnason, CEO Icelandair, tel. +354-864-7177.