Norse Atlantic ASA

Earnings Release • Feb 28, 2023

Norse Atlantic Airways H2 2022 results - Successful launch of first summer programme in 2022 and strong forward bookings for summer 2023 peak period ahead

Norse Atlantic Airways H2 2022 results - Successful launch of first summer programme in 2022 and strong forward bookings for summer 2023 peak period ahead

During the second half of 2022 Norse Atlantic reported an operating loss of $43

million before leases, depreciation and amortization (EBITDAR). Operating profit

was negative $106 million in the six month period, $52 million of which was non

-cash lease accounting costs. Total cash held at yearend was $70 million. The

Norse Atlantic Airways fleet consisted of 15 delivered Boeing 787 Dreamliner

aircraft at by year end, five of which have now been successfully subleased to

another operator.

"In the latter half of 2022 Norse Atlantic Airways successfully launched and

expanded operations from three European destinations, Oslo, Berlin and London to

the US. This marked a tremendous achievement and was a testament to the hard

work and dedication of every colleague across the business. Norse Atlantic

Airways has become a force to be reckoned across the Atlantic and to date we are

on track to deliver the business plan communicated during the Private Placement

in November 2022 and we continue to work towards being profitable by the end of

Our focus on cost control and swift action to reduce winter frequencies on

routes displaying lower than expected demand has shown the agility and speed at

which Norse Atlantic Airways can adapt to the current challenging global

economic environment. As our core routes between Europe and the US have become

more established, I am pleased to also see forward bookings and our cargo

operations continue to grow in line with our expanded summer 2023 schedule."

said Bjorn Tore Larsen, CEO Norse Atlantic Airways.

Following the Company's first commercial flight on 14 June 2022 - just 14 months

after Norse Atlantic ASA ("Norse", "Norse Atlantic Airways" or the "Company")

was formed and the IPO completed - the second half of 2022 marked a number of

milestones in Norse's short history as it launched several new routes from new

European and US cities  as it gradually increased from one aircraft in operation

at the end of June to four at the yearend. Norse flew over 289,000 passengers

and operated 1,427 flights successfully during the Period.

The Company recorded an average load factor for the six months ended 31 December

2022 ("H2 2022" or the "Period") of 62%, with a monthly high during the peak

summer month of July at 86% and a monthly low of 50% during the normal

historically low demand month of November. Norse achieved a decent operational

performance, flying over 99% of scheduled flights, with the few cancellations

being due to adverse weather conditions outside the Company's control.

During the second half of 2022 Norse was awarded a UK AOC (Aircraft Operating

Certificate) and operating License by the UK Civil Aviation Authority, and

subsequent authorisation from the US Department of Transport to operate flights

between the UK and US, which will open up a key market for the Company.

Additionally, Norse secured further landing slots at London Gatwick and JFK New

York, which Norse will utilize from the summer 2023 season as it ramps-up

production. By mid-summer 2023 the Company expects to be utilizing its full

fleet of 15 aircraft, with 10 aircraft under own operations and five aircraft on

sublease to a third party.

Norse completed a private placement equity raise of gross NOK 300 million

(approximately USD 30 million) during H2 2022. The proceeds are used in relation

to maintaining a sufficient liquidity balance following a requirement from the

UK air authorities to ring fence an amount in relation only to Norse's wholly

owned UK subsidiary Norse Atlantic UK Ltd, as well as general corporate

purposes. In relation to the private placement, Norse is committed to carry out

a repair offering during the first half of 2023, which can raise up to an

additional NOK 150 million.

During the Period Norse launched partnerships with major European and US

airlines, easyJet, Norwegian and Spirit Airlines, that allows passengers to

connect in a virtual interline arrangement, powered by Dohop.

The Company took a careful approach to increasing production during H2 2022,

choosing to fly an average of four aircraft through the seasonally low winter

season, allowing Norse to focus on preparations for ramping-up production from

summer 2023 season, starting with adding Paris from 26 March 2023 and flying

with five tails based at London Gatwick by the middle of 2023.

Cargo revenues recorded in the Period totalled USD 10 million, an amount

equivalent to 10% of Norse's overall revenues. Norse completed its first charter

flights during the latter part of the Period, flying nine charters in November

and 21 in December 2022, with charter activity continuing into 2023. The

charters were mainly done for the Norwegian Government as well as one global

tour operator for winter holiday destinations in the Caribbean and the Far East.

Norse has a fleet of 15 modern, fuel-efficient and environmentally friendly

Boeing 787 Dreamliners at historically low pricing and favourable lease terms,

including power by the hour payments for a minimum period of the first 12 months

after respective aircraft deliveries. As of 31 December 2022, all aircraft are

delivered, with five subleased out to a third party for a duration of 18 months

each. The total revenue from the aircraft sublease component is expected to be

in excess of USD 50 million over the term of the subleases.

Looking ahead to a strong summer 2023 with a focused route network

Inflation is high in Europe and the US, impacting the spending power of

consumers, while jet fuel prices remain high and make-up a much higher

proportion of airlines' cost base than previously. Norse is a very young airline

and will only be operating on a scale that gives efficiencies from mid-2023,

while it continues to enjoy the benefits of flexible aircraft lease terms,

including power by the hour and low lease rates, during its ramp-up.

As expected, 2022 is a loss-making year as it is a start-up year, being Norse's

first full financial year since incorporation in 2021. Start-up costs, including

investment in systems, costs related to achieving regulatory approvals,

recruitment and initial training impacted the Company's bottom line, while the

first flight and, thus, first revenue-generating activity, was about halfway

through the year. The next financial year - 2023 - will be Norse's first full

year of operations, though Norse will be in a start-up / ramp-up phase during

the first half of 2023 and it will be the second half of 2023 that Norse is

fully operational.

As a start-up airline that was still in the process of obtaining all relevant

regulatory approvals, as well as airport slot times, performance in 2022 has

been negatively impacted by having short selling windows between launching

ticket sales for a route and flights. For example, there were six weeks between

Norse's first tickets on sale for its Oslo-New York route, while in comparison

established (ie. non-start-up) airlines typically have tickets on sale 330 days

in advance. Norse made its first summer 2023 routes available for sale on 9

November 2022, while due to regulatory approvals the final summer 2023 network

was only available for sale from 28 February 2023. As Norse is able to increase

its booking window it is expected to have a positive impact on ticket sales as

customers will have a longer period to make bookings.

Establishing a new airline takes time and investment and Norse is on-track to

becoming a profitable transatlantic low cost carrier. Building a reliable and

known brand is continuous and is not completed overnight. While tickets were

initially only available for sale on the Company's website, since mid-2022 Norse

fares have gradually become available on more and more platforms, including

finn.no, kayak.com, kiwi.com, skyscanner.net, and booking.com. During 2023 Norse

expects to have tickets for sale on Expedia and will look to add additional

selling platforms.

Norse is sufficiently financed and ready for ramp-up to fully operational fleet

in summer 2023, including 5 aircraft based at London Gatwick. Strong sales

momentum at the end of 2022 and post period end for summer season bookings give

preliminary indications that the second half of 2023 could be the Company's

first period of profitability since it commenced flying.

"Norse Atlantic Airways continues to build on the solid business plan laid out

in 2022. The year ahead will mark many milestones for the company and consumers

as we fully establish our presence in key markets and become the disruptor

airline of the transatlantic market by offering value, comfort and choice to a

wide customer base eager to travel.

As we enter into our first full summer season in 2023 the initial substantial

investments that were necessary to launch Norse Atlantic Airways operations, and

subsequently establish our UK based airline, will have created a strong and

sustainable company, ready to swiftly seize on new opportunities and navigate

through an unpredictable global economic environment," continued Bjorn Tore

Larsen, CEO Norse Atlantic Airways.

To date Norse Atlantic Airways is performing on track or above the business plan

communicated during the Private Placement in November 2022. As previously

communicated, the company will carry out a repair offering to those shareholders

eligible as at 24 November 2022. The repair offering is expected to be done

during the spring once the required prospectus is approved by the Norwegian

Financial Services Authority.

For further information please see attached H2 report and company presentation.

Contacts:

Investor contacts: Ben Boiling, CFO, ben.boiling@flynorse.com

Media contacts: Philip Allport, Senior Vice President Communications

media@flynorse.com

Norse Atlantic Airways is a new airline that offers affordable fares on long

-haul flights, primarily between Europe and the United States. The company was

founded by CEO and major shareholder Bjørn Tore Larsen in March 2021. Norse has

a fleet of 15 modern, fuel-efficient and more environmentally friendly Boeing

787 Dreamliners that serve destinations including New York, Los Angeles, Fort

Lauderdale, Orlando, Oslo, London, Berlin, Rome and Paris. The company's first

flight took off from Oslo to New York on June 14, 2022.

This information is subject to the disclosure requirements pursuant to Section 5

-12 the Norwegian Securities Trading Act and the Euronext Growth Rule Book part

II.