Atlantic Airways P/F - Financial Statement Release

Atlantic Airways 1 Quarter Report 2012: Growth in revenue but lower result

Revenue increased 9% to DKK 91.9 million in Q1 2012 from DKK 84.5 million in
the corresponding period in 2011. The increase is mainly down to an increase in
the number of passengers on scheduled services, but the result before tax
(EBT), however, decreased to a loss of DKK 5.3 million from a loss of 2.6
million in Q1 2011. The main explanatory factors for the lower result are
higher fuel costs, costs related to the phasing in of the new Airbus and a
lower contribution from charter and ACMI activity in Europe. 

Atlantic Airways' EBITDA result for the first quarter of 2012 amounted to DKK
7.0 million, compared with DKK 9.3 million for the same period last year, which
corresponds to a decrease of 24%. The result after tax for the first quarter of
2012 was DKK -4.3 million, compared with DKK -2.1 million last year. 

The trend towards growth in scheduled traffic is positive, although some of it
is related to fluctuation in Easter traffic. The helicopter segment also meets
expectations, but demand for ACMI in particular has decreased - a trend we also
experienced at the end of 2011. This has led to a lower utilisation and has
combined with very high fuel prices affected the bottom line negatively. 

However the most significant event in the past quarter was the introduction of
the Airbus A 319 to the fleet.  The company focus was very much on the delivery
of the new aircraft and the implementation of a new operational platform for
the future. The entry into service went smoothly, but the commercial impact of
the new concept will not show until next quarter, as the aircraft only operated
commercially from the end of March. The benefits are expected to show in lower
operating costs, reduced fuel burn, higher regularity and new commercial
opportunities. However, they come at a higher capital cost. 

“We are grateful to all those who contributed to the smooth entry into service
of our factory-new Airbus A 319 and we are proud to pioneer the navigational
procedure RNP AR 0.1 in Europe. The aircraft has met or exceeded our
expectations and the RNP has proved to be valuable,” says Magni Arge, CEO of
Atlantic Airways. “As part of our continuous review of scheduled services and
new opportunities we have established a case for extending the current
summer-only service between the Faroe Islands and Bergen, Norway, to a
year-round service.“ 

The first quarter of the year is traditionally a weak financial quarter in the
airline industry, and Atlantic Airways' result after the three months of 2012
reflects that. The successful implementation of the Airbus concept has
diminished uncertain factors in 2012, but only after operations in the second
quarter will we have a clearer picture of how the implementation of the new
Airbus platform affects the result. Outlook for charter and ACMI are still
lower than the previous year, but helicopter activity will pick up with the
exploration activity later in the year. Fuel prices and other external economic
factors do still have a significant impact, so we remain cautious in our
guidance as to financial performance in 2012 and still expect to reach a result
somewhere between the 2010 and 2011 level. 



For further information contact:

Magni Arge, CEO, tel. +298 213700, magni@atlantic.fo

Marius Davidsen, CFO, tel. +298 213703, marius@atlantic.fo

Attachments:

Q1 2012-Atlantic Airways.pdf