Norway’s Flyr “critical” after failed capital raising

Flyr (Norway) (FS, Oslo Gardermoen) has said it is “in a serious financial situation” after failing to raise the capital it needed, and its board will now “assess whether there are alternatives for continued operation.” As its stock price plummeted, it assured in one of its statements issued on January 30 that “today’s flights are running as normal.”
The loss-making carrier said it had informed the Oslo Stock Exchange on the morning of Monday, January 30 that the company “has not been successful with its new financing plan.” That same day’s flights from Oslo to Alicante, Gran Canaria, and Malaga will operate, it pledged, adding: “The company has no scheduled flights on Tuesday and information about future flights will be shared as soon as possible on flyr.com.”

In its Oslo Børs filing, it lamented that “market conditions and continued uncertainty with regards to airline travel and earnings through 2023 have deterred investors from committing capital for the required period of time, in spite of the company’s wet-lease opportunities and improving ticket sales.”

It said that “due to the unsuccessful process to underwrite a rights issue or carry out a private placement, the company is now in a critical short-term liquidity situation.” The board will continue to try to find “feasible alternatives to secure continued operations [but] there is no guarantee that a solution that would create meaningful shareholder value for current shareholders will be found.”

Flyr said in early November that it was hoping to raise up to NOK530 million kroner (USD53.5 million) in new equity to survive the lean winter season. It failed to secure that amount but opted to rejig its fundraising later that month and managed to raise NOK250 million (USD24.9 million) in a share issue.

This was only half the cash it needed as it prepared for a ramp-up in spring 2023. Most recently, it had been trying to secure further funding of EUR330 million euros (USD33.2 million) in a rights issue but had “not yet been able to raise the sufficient market underwriting.”

Options for the airline had included increased wet-lease operations, and a month ago it said it had applied to the United States Department of Transportation (DOT) for a foreign air carrier permit to operate chartered and ACMI flights from November 2023 as it had seen “an increasing number of requests from North American companies.” In mid-December, it initiated discussions with a European airline for a wet-lease arrangement for six aircraft for the 2023 summer season, to start at the end of March. Such a deal “would considerably de-risk the business case and improve the chances of succeeding with a new financing plan,” it said.

To be ready to perform these obligations, Flyr “had to reverse some of the liquidity preserving measures it had planned and implemented, as the wet-lease agreement was considered instrumental in securing the new financing plan that would address” both its short-term and long-term funding requirements. This drove it to seek the as-yet unfulfilled EUR330 million rights issue.

Also on January 30, Oslo Børs decided to temporarily place the company in its Recovery Box, a “special compartment” where the stock exchange can place securities “when the issuer is subject to circumstances that make pricing of the securities particularly uncertain.” Such a category does not affect trading.

Ch Aviation / Photos: Flyr
 

Flyr eyes US ACMI/charters from mid-4Q23

Flyr (Norway) (FS, Oslo Gardermoen) has applied to the US Department of Transportation (DOT) for a foreign air carrier permit to operate chartered and ACMI flights from November 2023, following what it said had been “an increasing number of requests from North American companies.”

It announced in an Oslo Stock Exchange filing on December 19 that it would send its application later that day, explaining that its “updated strategy includes taking advantage of commercial opportunities outside of its home market in the low season.”

Flyr, which last month managed to secure enough funds to survive the current lean European winter season, has spied opportunities across the Atlantic where “the shortage of aircraft and crews in the North American market increases the demand for charter and wet lease operations.”

The airline “is diversifying its production to meet seasonal demand and reduce risk” with the aim of “building a financially sustainable airline.” This means it will base several of its aircraft and crew in other markets, such as North America, in future winter seasons when demand in Europe is lower.

“As Flyr can deliver an attractive product consisting of new, fuel-efficient aircraft and professional crews to many of the customers who have reached out to us in recent months, we will today apply for or a US foreign air carrier permit so that we may offer non-scheduled charter and wet lease flight from November 2023,” Flyr CEO Brede Huser underlined in the disclosure. “Flyr is a modern, small, and flexible airline that has the ability to adapt quickly to market changes and demand.”

Flyr operates six B737-8s and six B737-800s.

 Ch Aviation

Photos: Flyr

Flyr (Norway) to launch Oslo – London Gatwick schedule on 26 March 2022, with B737-800.

Ton Jochems - PMI
LN-FGC - B737-800W -

 

Flyr plans drastic reduction

 Flyr, Norway's newest low-cost airline, has announced it will drastically reduce its operations in the upcoming winter season. Due to inflation, high energy costs, and higher interest rates, the airline expects lower customer demand and it sees no other option than to reduce operations and staff to cut costs. In total, the total reduction of its operations is around 50%.

Flyr will keep a staff that is sufficient enough to operate five to six aircraft, which is half of the fleet. Today, it operates six B737-800s and six B737-8s. Most of its domestic flights will be scrapped, focusing on flying between Oslo, Bergen and Trondheim. Internationally, Flyr will only serve Alicante, Barcelona, Berlin, Brussels, Las Palmas, Malaga, Nice and Rome between November 2022 and April 2023.

With these measures, Flyr wants to position itself for a ramp-up for next year's summer season once demand returns.

Photo:FPP - LPFR

 

Flyr welcomes 1st B737MAX

Flyr welcomed its first of six B737-8s at Oslo, arriving non-stop from Seattle-Boeing Field (WA). The aircraft, registered LN-FGF (43324), has entered commercial service on 27 February, with the first flight going to Helsinki.

The Norwegian airline announced a lease-agreement for six B737-8s in October last year. The MAXs are leased via Air Lease Corporation and Flyr also has options on another four MAXs.

Next to its new B737-8, the airline operates six B737-800s. A second B737-8 is due in the coming weeks.

ch aviation

Flyr to lease up to 10 B737 MAX

Flyr (FS, Oslo Gardermoen) has signed a letter of intent with Air Lease Corporation for six brand-new B737-8s. The aircraft will be delivered directly from Boeing (BOE, Chicago O'Hare) to the Norwegian budget carrier starting in early 2022 with the entire batch to be in place by July of that year. There is also an option in the agreement for four more aircraft with delivery in 2023.

According to the ch-aviation fleets advanced module, Flyr's fleet currently consists of three B737-800s of which one is leased from Banc of America Leasing Ireland and the other two from Standard Chartered Aviation Finance. Flyr's network currently hinges on an Oslo Gardermoen hub serving various cities across Norway as well as destinations in Italy, Spain, France, Switzerland, Germany, and Austria.

In its 1H2021 financial report, Flyr said it planned to add an additional two to four aircraft by the end of the year, servicing primarily domestic Norway high demand routes, and select European leisure destinations. The intention for 2022, depending on the pandemic and travel demand, is to add additional six to 10 aircraft during the year thereby bringing its fleet to 12-18 aircraft by the end of 2022.

ch aviation

Flyr to operate route network with 737-800s

 The new Norwegian airline established by Erik Braathen hopes to be operational by the second quarter of the year.

Norwegian start-up Flyr has outlined a strategy to fly domestic and short-haul international routes using Boeing 737-800 aircraft.

The Oslo-based airline, founded by experienced industry executive Erik Braathen, hopes to begin commercial operations during the second quarter of the year.

During the first phase, Flyr intends to serve larger Norwegian cities and “popular” European destinations before gradually increasing its network. The carrier’s longer-term ambition is to own a fleet of up to 30 aircraft.

“We are in a situation where we can obtain the right aircraft for the right price, and where we can build our systems with new, up to date technology,” CEO Tonje Wikstrøm Frislid said. “Our goal is to provide the customers with a seamless, digital service from start to finish.”

Flyr said it would be fully funded through private investments of NOK600 million ($70 million). Arctic Securities is advising on the placement alongside two other Norwegian investment banks.

“The capital will be sufficient to fund a lean organization with the people and competencies needed,” Frislid added.

“We have said that we will adapt the number of airplanes to market demand. Adaptability and flexibility will be highly important going forward, even though the future looks brighter for the industry now than it did a few months ago.”


By David Casey - Routes Online