Icelandair Group — Capital/Financing Update 2016

May 6, 2016

Agreement signed on the purchase of two Boeing 767-300 aircraft

Agreement signed on the purchase of two Boeing 767-300 aircraft

This month, Icelandair, a subsidiary of Icelandair Group, will take into
commission two Boeing 767-300 aircraft. In addition, an agreement has now been
signed on the purchase of two Boeing 767-300 aircraft. These aircraft will be
delivered in the coming months and undergo complete refurbishment, in line with
other aircraft in Icelandair fleet. Refurbishment is expected to be completed
in early 2017. Purchase price is confidential. Four Boeing 767-300 aircraft
will therefore be used to serve Icelandair Route Network in 2017. The new
aircraft seat 262 passengers, while the Company's Boeing 757-200 aircraft carry
183 passengers. This investment is intended to support continued organic growth
that is planned for next year.

For further information, please contact:

Björgólfur Jóhannsson, President and CEO of Icelandair Group
tel: +354-896-1455

Bogi Nils Bogason, Chief Financial Officer of Icelandair Group
tel: +354-665-8801