Norse Atlantic Airways

Q2 2023 Presentation 31 August 2023

Highlights

Activity increasing and new routes added Low-cost confirmed • June is first profitable month in Company's history • Expect profitable Q3 Profitable summer • High and increasing load factors during summer peak season • Strong summer bookings with increasing fare levels Load factors and fares increasing • Gradually increased activity through Q2 2023, all aircrafts in production from 1ˢᵗ of July • Several new routes and destinations opened • All flights operated through summer 2023, zero cancellations • Successful focus on ancillary revenues • Business model confirmed as passengers add on services based on own preferences Ancillary revenue continues to increase • Ramping up activity while keeping costs under control • CASK gradually decreasing as available seat kilometers (ASK) increase

Challenges and Opportunities

Cargo market	• Cargo market disappoints with low volumes and price pressure
Cash management	• Rapid growth is capital intensive, increased bank guarantees and restricted cash plus hold-back from credit card companies • Aiming to gradually decrease as company and operations mature
Premium class	• New and improved service program in Premium class to be rolled out during September • Potential for increased fares and higher load factor at attractive price point
Revenue management	• Managing fare levels, load factors and route selection through the seasons is of key importance
ACMI	• Well positioned for attractive ACMI opportunities through winter season

Increased Sales – Decreased CASK

Passengers and Load Factor Per Month CASK (Ex Fuel) per Quarter + July 2023

•

Ancillary sales are increasing

Ancillary Revenue Per Passenger \$

\$-

• Bundles are ancillary items included in the original ticket price of Classic and Flextra fares and are showed as ticket revenue in our financials

Q2 2023 Financials

USD thousands	3 months Q2 2023	3 months Q1 2023	3 months Q4 2022	12 months FY 2022
Revenue	100,101	39,757	46,428	104,269
Personnel expenses	19,353 23,590		17,434	44,462
Fuel, oil & emissions	25,945	21,896	27,002	61,793
Other OPEX	38,119	24,121	22,346	42,706
SG&A	10,230	7,314	5,751	15,630

EBITDAR	2,218	(32,926)	(26,103)	(60,323)
Variable aircraft rentals	7,755	8,725	13,180	27,263
Depreciation & amortization	20,655	20,813	19,402	58,517
EBIT	(26,202)	(62,464)	(58,685)	(146,104)
Net finance cost	8,784	8,408	8,378	28,871

Income Statement

Large increase in capacity and revenue during summer season ramp-up

• Q2 2023 revenue up 152% versus prior quarter due to; ⚬ 51% increased capacity (ASK) ⚬ 89% increased revenue per passenger ⚬ Load factor up to average of 75% over quarter, and with strong intra-quarter development

-

• Fuel up 19%, increasing less than production due to lower unit cost

• Variable aircraft rentals represents cash paid under Power By the Hour (PBH) aircraft lease terms

• USD 16 million non-cash aircraft lease accounting cost

Balance Sheet

Statement of financial position

• \$911 million aircraft right-of-use asset ⚬ 15 Boeing 787 Dreamliners on leases with average remaining life 10.6 years ⚬ Corresponding lease liability of \$971 million

• \$20 million refundable aircraft lease deposits carried at \$16 million

• \$117 million receivables from credit card companies for booked tickets

• \$117 million liabilities to passengers for fares being booked, not yet flown

• Value adjusted equity position in excess of USD 300 million, including NPV value of the aircraft leases

USD thousands	30 Jun-23	31 Mar-23	31 Dec-22
Non-current assets	949,429	952,148	973,037
Total current assets	197,514	130,984	117,202
Total assets	1,146,518	1,083,132	1,090,239
Total equity	(82,157)	(60,337)	10,535
Non-current liabilities	967,693	965,875	971,284
Current liabilities	260,981	177,595	108,421
Total equity & liabilities	1,146,518	1,083,132	1,090,240
Number of aircraft received	15	15	15

- -

-

Cash Flow Statement

• Q2 2023 total cash increase of \$17 million mainly driven by \$19 million inflow from

- operations

-

• \$59 million total cash held at end Q2 2023

• Restricted cash increased by \$10 million during quarter due to network extensions

• Subsequent equity offering was completed in April 2023, raising gross \$14 million

• Net increase in cash during the quarter, also net of cash from subsequent equity offering

USD thousands	3 months Q2 2023	3 months Q1 2023	3 months Q4 2022	12 months FY 2022

Operating cash flows	18,996	(20,771)	(13,264)	(68,639)
Investing cash flows	(1,357)	1,256	7,921	(24,956)
Financing cash flows	(9,724)	(8,530)	27,928	22,589
Forex	(932)	366	1,463	1,463
Net change in free cash	6,983	(27,679)	24,049	(69,543)
Free cash at period end	44,013	37,030	64,709	64,709
Restricted cash held	15,056	5,000	5,000	5,000
Total cash	59,070	42,030	69,709	69,709

14 June 2022 to 31 Jul 2023

Key Operational Numbers Since First Flight

	Jun22	Jul22	Aug22	Sep22	Oct22	Nov22	Dec22	Jan23	Feb23	Mar23	Apr23	May23	Jun23	Jul23
Number of aircraft in fleet	11	13	13	13	14	14	15	15	15	15	15	15	15	15
Aircraft subleased out	2	4	4	4	4	4	5	5	5	5	5	5	5	5
ASK (millions)	54	248	505	663	567	293	384	397	344	390	449	511	750	1,215
RPK (millions)	44	212	349	373	338	145	233	206	172	234	300	371	619	1,034
Load factor	82%	86%	69%	56%	60%	50%	61%	52%	50%	60%	67%	73%	83%	85%
Number of passengers	6,633	31,842	58,702	62,749	60,836	29,816	44,172	35,150	32,970	42,143	48,847	56,680	97,037	150,621
Number of flights	24	110	254	338	307	190	228	229	203	223	218	243	351	524