I am pleased to conclude a busy first quarter and winter season forSAS , marked by increased passenger volumes, and several exciting new projects and destinations. We are pleased to see that more and more people choose to travel withSAS , which clearly confirms that our?ramp-up efforts continue to be successful. We are getting ready for the summer season, during whichSAS will fly to over 130 destinations in more than 40 countries. We have added frequencies to popular destinations acrossEurope , and nine new European destinations. We will also increase flights toNorth America andAsia in the summer program by adding flights to popular destinations such asNew York andTokyo . Furthermore, we have expanded the summer program to includeAtlanta in the North American network, with daily direct flights throughout the summer season. We look forward to flying our passengers to their summer destinations.SAS aims to be a driving force in sustainable aviation and in January, we announced a new collaboration with Airbus,Swedavia ,Vattenfall and Avinor, to jointly investigate the feasibility of infrastructure for hydrogen-fueled aircraft at airports inNorway andSweden , with the goal to develop a framework for the rollout of hydrogen-powered flights. This partnership is an important step in driving the transition towards achieving net-zero emissions. We are making steady progress in our Chapter 11 process in the US and in reaching our overall targets in theSAS FORWARD plan. In November, we entered into an investment agreement with the winning bidder consortium in our exit financing solicitation process, consisting ofCastlelake ,Air France-KLM and Lind Invest, together with the Danish state. The agreement entails a total investment in the reorganizedSAS corresponding to approximatelySEK 13.2 billion . We currently aim to receive approval by the US court for the Chapter 11 plan in the first quarter of 2024, followed by regulatory approval and a likely Swedish company reorganization at theSAS AB level. As a result of that process, we repeat the expectation that there will be only a modest recovery for general unsecured creditors, no recovery for subordinated creditors and no value forSAS AB's existing shareholders, and that all ofSAS AB's common shares and listed commercial hybrid bonds will be cancelled, redeemed and delisted, in connection with emergence from the Chapter 11 process. Any payment of recoveries to creditors will be made only after the completion of the transaction and the fulfilment of any conditions for payment to creditors. We currently expect to emerge from the restructuring proceedings around the end of the first half of 2024.NOVEMBER 2023 -JANUARY 2024 · Revenue: MSEK 8,923 (7,896) · Income before tax (EBT): MSEK -1,070 (-2,449) · Income before tax and items affecting comparability: MSEK -1,032 (-2,451) · Net income for the period: -1,453 (-2,709) · Earnings per common share:SEK -0.20 (-0.37) SIGNIFICANT EVENTS DURING THE QUARTER · OnNov. 4 ,SAS entered into an investment agreement with the winning bidder consortium and a DIP term loan agreement with?Castlelake. · OnNov. 15 ,SAS repaid its original DIP term loan. · OnNov. 29 , theEuropean Commission announced that the recapitalization ofSAS in 2020 complied with state aid rules and was thereby approved. · OnJan 2 ,SAS announced over 130 destinations in more than 40?countries for the summer season 2024. · OnJan. 23 ,SAS published updated financial projections for the reorganizedSAS .SAS currently targets to receive court approval of the Chapter 11 plan in the first quarter of 2024 followed by regulatory approval and a likely Swedish company reorganization at theSAS AB level.SAS currently expects to complete the restructuring proceedings around the end of the first half of 2024. ·SAS expects that there will be only modest recovery for general unsecured creditors, no recovery for subordinated unsecured creditors and that there will be no value forSAS AB's existing shareholders upon emergence from the restructuring process. All?ofSAS AB's common shares and listed commercial hybrid bonds are expected to be cancelled, redeemed and delisted. SIGNIFICANT EVENTS AFTER THE QUARTER · OnFeb. 5 ,SAS filed a second amended Chapter 11 plan and a related disclosure statement with the US court. The Chapter 11 plan obtains support of theOfficial Committee of Unsecured Creditors . OUTLOOK · The first quarter interim report includes financial projections on page 10. QUARTERLY RESULTS We observed continued healthy passenger demand through the first quarter with the total number of passengers up 6.3 percent compared with the same period last year. Year-on-year, our RPK increased 13.3?percent, while capacity increased 9.3 percent. Our?flown load factor for the quarter was 71.8 percent, up 2.6 percentage points compared with the same period last year. The increase in passenger demand and capacity led to a year-on-year increase of 13 percent in our total operating revenue, which landed atSEK 8.9 billion for the quarter. Earnings before tax ended at a negativeSEK 1.1 billion , representing a year-on-year improvement ofSEK 1.4 billion . Cost reductions across the business remain in focus to secure our cost competitiveness, and total operating expenses for the quarter ended atSEK 10.1 billion . Many of the cost efficiencies of theSAS FORWARD plan are ramping up over time, and some have been implemented but cannot be recognized in our financial results until after emergence from Chapter 11, including cost savings from the fleet restructuring. The cash balance at the end of the quarter was SEK?5.3?billion. Cash flow from operating activities during the quarter amounted to an outflow of SEK?38?million. NEW ROUTES AND DESTINATIONS As part ofSAS ' strategy to strengthen our offering for Scandinavian travelers, and to adapt to the relative increase in demand for leisure travel,SAS has announced several new routes during the quarter. We are getting ready for the summer season, and in early January we were pleased to announce thatSAS will fly to over 130 destinations in more than 40 countries this summer. We have added frequencies to popular destinations acrossEurope , and we have added nine new European destinations, including direct flights to Ibiza, and Tivat on the coast ofMontenegro , among others. We will also increase flights toNorth America andAsia in the summer program by adding frequencies to popular destinations such asNew York andTokyo . We have also expanded the summer program to includeAtlanta in the North American network, with daily direct flights throughout the summer season. With almost 94 million passengers passing through in 2022,Hartsfield-Jackson Atlanta International Airport is the world's busiest and most efficient airport. Cargo transportation is expected to play an important role for this route, partly because of its proximity to thePort of Savannah , the largest and fastest -growing container terminal in America. This also means an expanded offering forSAS passengers, who can look forward to reaching several new and exciting destinations across theSouthern USA ,Caribbean andLatin America , all conveniently accessible fromAtlanta . Furthermore,SAS has added frequencies betweenStockholm and Skellefteå, due to the increasing growth in the Skellefteå region. FromApril 8 ,SAS will offer new frequencies on the busiest business travel days. Expanded air traffic plays a crucial role in the region's ongoing expansion, and we are proud to provide businesses and residents of Skellefteå with opportunities to connect with the world. In February, after the end of the quarter, we launched the concept Destination Unknown, which entailsSAS inviting EuroBonus members to embark on a mysterious journey. OnApril 5 ,SAS EuroBonus members will meet atCopenhagen Airport ready to board a mystery trip. The travelers are invited to explore the concept of flying to an unknown destination and join a unique adventure curated bySAS . We were pleased to be met by great interest for this concept, and more than 1,000 members signed up for the chance to embark on the mystery journey within minutes. The allure of the unknown destination will keep travelers on the edge of their seats throughout the flight until the destination is revealed. All Destination Unknown tickets are biofuel?tickets.SAS was also awarded a three-year contract extension withEquinor in February, for both domestic and international travel. The contract withEquinor represents a significant contribution toSAS ' passenger volume inNorway .SAS was chosen on the basis of an extensive network, attractive timetable, commercial terms and one ofEurope's most modern fleets. We are delighted thatEquinor once again have chosenSAS as their preferred carrier for business travel, demonstrating a continued confidence in us for the next three years. UPDATE ONSAS ' TRANSFORMATION PLAN We launched our comprehensive business transformation planSAS FORWARD in conjunction with the publication of the first quarter report for FY 2022, in the end ofFebruary 2022 . The aim of the plan is to secure long-term competitiveness forSAS in the global aviation industry. OnJuly 5, 2022 , to accelerate the implementation ofSAS FORWARD, we announced that we had voluntarily filed for Chapter 11 in the US, a wellestablished and flexible legal framework for restructuring businesses with operations in multiple jurisdictions. Through this process, we aim to reach agreements with key stakeholders, restructure the company's debt obligations, reconfigure our aircraft fleet and emerge with a significant capital injection. During the quarter, in November, we entered into an investment agreement with the winning bidder consortium in our exit financing solicitation process, consisting ofCastlelake ,Air France-KLM and Lind Invest, together with the Danish state. The agreement entails a total investment in the reorganizedSAS corresponding to approximatelySEK 13.2 billion , including approximatelySEK 5.2 billion in new unlisted equity and approximatelySEK 8 billion in secured convertible debt. As part of the transaction, we have also secured new Debtor-in -Possession ("DIP") financing ofSEK 5.5 billion fromCastlelake . The funds from the new DIP financing agreement are being used for, among other things, refinancingSAS ' original DIP term loan, increasing liquidity, and supportingSAS ' path to exit from its voluntary restructuring proceedings. The refinancing ofSAS ' original term loan was completed in November. As part of the transaction,SAS also intends to eventually exit theStar Alliance and join theSkyTeam Alliance , of whichAir France-KLM is a founding member. Through the completion of this process and the opportunities presented by being part of SkyTeam, we will be able to further enhanceSAS ' offerings for the benefit of our colleagues, customers and communities. This is a truly exciting step forSAS . However, it is important to note that nothing is changing as of now.SAS is still part ofStar Alliance and our EuroBonus members will continue to enjoy their usual benefits when flying on our partner airlines. Members can continue to accrue and redeem points - just like today, and their benefits when they fly withSAS will not be impacted. The agreed exit transaction remains subject to approval in connection with the confirmation of our Chapter 11 plan of?reorganization. OnFebruary 5, 2024 ,SAS filed a second amended Chapter 11 plan and related disclosure statement with the US court.SAS also announced expected recoveries for creditors in the Chapter 11 process and that theOfficial Committee of Unsecured Creditors supports the Chapter 11 plan. The Chapter 11 plan and the disclosure statement remain subject to further amendments and court approval. We currently aim to receive approval from the US court for the Chapter 11 plan in the first quarter of 2024, followed by regulatory approval and a likely Swedish company reorganization at theSAS AB level. As a result of that process, we repeat the expectation that there will be only a modest recovery for general unsecured creditors, no recovery for subordinated creditors and no value forSAS AB's existing shareholders, and that all ofSAS AB's common shares and listed commercial hybrid bonds will be cancelled, redeemed and delisted, in connection with emergence from the Chapter 11 process. Any payment of recoveries to creditors will be made only after the completion of the transaction and the fulfilment of any conditions for payment to creditors. We currently expect to emerge from the restructuring proceedings around the end of the first half of 2024. STEPS TOWARDS FOSSIL-FREE AVIATIONSAS aims to decarbonize aviation and progress on this ambitious plan can only be achieved through collaboration. By involving our customers and teaming up with them, we can reduce CO \2 emissions and enable increased large-scale production of sustainable aviation?fuels. Several organizations joinedSAS Corporate Sustainability Program (CSP) during the quarter. We were pleased to announce that SkellefteåCity Airport becomes the first individual airport to join the CSP, and that SKEBO Skelleftebostäder AB becomes the first real estate company to join the CSP. The partnerships entail that the organizations will purchase environmentally friendly aviation fuel for all its business trips withSAS throughout FY 2024. We hope these partnerships will inspire other companies to join our CSP and be part of the journey to transform aviation for generations to come.SAS has announced a new collaboration with Airbus,Swedavia ,Vattenfall and Avinor, to jointly investigate the feasibility of infrastructure for hydrogen -fueled aircraft at airports inNorway andSweden . Hydrogen is expected to become a significant fuel source for aviation in the future, and the goal of the collaboration is to develop a framework for the rollout of hydrogen-powered flights. By partnering with some of the strongest and most innovative players in the industry, we are assuming our responsibility to drive the transition towards achieving net-zero emissions. This is a journey that matters not just forSAS , but for the entire aviation?industry. OnJanuary 23 , we also launched the EuroBonus Conscious Traveler program. The new program enables EuroBonus members to make conscious choices when traveling withSAS - while getting rewarded for it. At the heart of Conscious Traveler lies a single goal; the involvement of our customers in the journey toward net zero emissions. The launch of EuroBonus Conscious Traveler is a contribution toward the industry target of net zero CO2 emissions by 2050 - perhaps our most important journey yet. We look forward to following the impact of the program throughout the year. LOOKING FORWARD I am pleased to conclude a busy winter season forSAS , marked by increased passenger volumes, and several exciting new projects and destinations. We continue our work toward completing our Chapter 11 process in the US, and toward reaching the objectives in theSAS FORWARD plan. The aim is currently to receive approval from the US court of the Chapter 11 plan in the first quarter of 2024, to be followed by obtaining regulatory approvals and the implementation of a Swedish company reorganization at theSAS AB level. While work still remains, I am pleased to see the substantial progress we are making to become a competitive and financially strong company. I am grateful for the hard work my colleagues atSAS are doing to ensure that we take the best possible care of our customers, and to ensure that they get the quality service they expect from us. Thank you for all your?efforts! As always, we look forward to welcoming our customers on board our aircraft. Anko van der Werff President & CEOStockholm ,March 7, 2024 Teleconference - Q1 2024 A teleconference and webcast for investors, analysts and media will be held at10.00 AM CET . Anko van der Werff, President & CEO andErno Hildén , Executive Vice President & CFO, will present and comment on the report. The presentation will be held in English. Access via web link (no advance notification is necessary): https://ir.financialhearings.com/sas-q1-2024 Link to register for participation via telephone: https://conference.financialhearings.com/teleconference/?id=5002479 After registration you will be provided phone numbers and a conference/user ID to access the conference. You can ask questions verbally via the teleconference. For further information, please contact:SAS press office, +46 8 797 29 44 Investor relations, +46 709 977 070SAS , Scandinavia's leading airline, with main hubs inCopenhagen ,Oslo andStockholm , flies to destinations inEurope, USA andAsia . Spurred by a Scandinavian heritage and sustainability values,SAS aims to be the driving force in sustainable aviation and in the transition toward net zero emissions. We are continuously reducing our carbon emissions through using more sustainable aviation fuel, investing in new fuel-efficient aircraft and technology innovation together with partners - thereby contributing towards the industry target of net zero CO2 emissions by 2050. In addition to flight operations,SAS offers ground handling services, technical maintenance, and air cargo services. Learn more at https://www.sasgroup.net This is information thatSAS AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency ofErno Hildén , at08:00 a.m. CET onMarch 7, 2024 .
Click here for more information
© Oslo Bors ASA, source