Icelandair Group hf. - Company Announcement

Continued growth in international flights in 2016

  -- Passenger number projected at 3.5 million
  -- Direct flights to 42 destinations
  -- Capacity increase of 18% between years
  -- Three new destinations:  Chicago USA, Montreal Canada and Aberdeen UK. 

Icelandair, a subsidiary of Icelandair Group, will see its international flight
schedule in 2016 expand by 18% from 2015. The number of passengers is projected
at 3.5 million in 2016, an increase of approximately 450,000 from 2015.  Three
new destinations will be added and flight frequency increased to several
gateways in both North America and Europe.  A total of 26 aircraft will be used
in the Route Network next summer, two more than this summer. The increase is
expected to result in a continued growth of the Icelandic tourist industry. 

Available seat kilometers will increase by 18% next year, while the number of
flights will increase by 14%. The difference is due to the increased weight of
longer flights to North America in the schedule. Also, two 262-seat Boeing
767-300 aircraft will be added to the fleet. The new aircraft are larger than
the Boeing 757 aircraft currently operated by the company. 

In 2016, Icelandair will offer direct flights to 42 destinations, an increase
of three new destinations. As announced earlier, year-round flights to Chicago
USA will begin in March, and Montreal Canada will be added as a new destination
in May. In March the Company will commence flights to Aberdeen UK, using Air
Iceland´s Q-400 aircraft. However, the main reason for the continued growth in
the international flight schedule will be the added capacity on routes to a
number of gateways in both North America and Europe. 

The scope of the international Route Network has almost tripled since 2009. In
that year passengers numbered approximately 1.3 million, or 37% of the number
projected for 2016. 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 just before noon.
Growth of the secondary bank presents an opportunity for two different
departure times within the same day, eliminates the congestion at Keflavik
Airport and supports the primary bank.  In 2016 much of the growth will be
outside the primary bank and not in the summer high season. 

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. +354-897-4017