As measured in available seat kilometers, the flight schedule more than doubled compared to 2021 and equaled 79% of 2019 levels. The total number of passengers on international and domestic flights was 3.7 million in 2022 compared to 1.5 million 2021, an increase of 150% between years.

The “from” market, with travel originating in Iceland, accounted for 15% of Icelandair’s total passengers. The “via” market between Europe and N-America accounted for 37% of total passengers. The domestic operation “within” Iceland accounted for 7% of total passengers. The passenger load factor over the year 2022 was at 80%.

Sold block hours in charter flights increased by 9%. Freight measured in Freight Ton Kilometers decreased by 7% between years. The on-time performance for the year was 73.5% compared to 84.0% in 2021, largely affected by challenging conditions at airports during the summer peak.

Transport revenue totaled USD 1,130.3 million, up by 149% between years. Transport revenue counts for 89% of the Company’s total operating income. Of this figure, passenger revenues amounted to USD 975.3 million and compared to 333.8 million last year. Icelandair divides its route network into four markets – to, from, via and within Iceland. The increase in passenger revenue was greatest in the “via” market between Europe and N-America,

but passenger revenue also increased significantly in the three other markets with improved load factors and higher yields in both cabins. Cargo revenue decreased by 5% compared to 2021 and amounted to USD 82.7 million. Cargo volume decreased by 7% between years, driven by less capacity due to maintenance work on two of the company’s freighters during the year and softer demand for exports.

Revenue from aircraft and aircrew leases increased from USD 42.7 million in 2021 to USD 58.5 million in 2022. The leasing operation recovered significantly during the year, with an increased operation for its main long-term customers along with new projects being secured.

Sold block hours increased by 9%, and the profitability improved strongly over last year. Other revenue totaled USD 76.4 million in 2022, down from USD 88.4 million from the preceding year. Lower revenue from tourism due to the divestment of Iceland Travel in December 2021 accounts for the largest share.

Operating expenses excluding depreciation amounted to USD 1,127.4 million and increased by USD 519.7 million from 2021. The main drivers are a larger scope of business and higher fuel prices.

The capacity measured in available seat kilometers increased by 122% between years and the Icelandair route network had reached 95% of the 2019 capacity in the fourth quarter.

Fuel expenses amounted to USD 374.5 million and more than tripled between years. The difference year-on-year is explained by the significant ramp-up of the operation and 59% increase in average effective fuel price.

The average effective price (including hedges) in 2022 was USD 1,156 m/ton, as compared to USD 727 m/ton in 2021. A larger B737 MAX fleet positively contributed to fuel savings.

Other operating expenses amounted to USD 248.2 million, compared to USD 156.8 million in 2021. During the first months of the year, operation was negatively impacted due to Covid related restrictions and border closures, which were then significantly eased in the spring. Following that period, Icelandair experienced, as the entire aviation industry, operational challenges, such as congestion at foreign airports, that lead to disruptions during the summer peak.

In addition severe weather conditions towards the end of the year resulted in costly flight cancellations during the busy Christmas travel period. Customer service costs totaled USD 45.5 million compared to USD 13.9 million last year. Tourism expenses decreased with the divestment of Iceland Travel in December 2021. The main reason for the increase in other expense categories is mainly a larger scope of business

Net finance cost totaled USD 24.3 million in 2022, as compared to net finance income of USD 0.6 million in 2021. The finance income amounted to USD 8.8 million down from USD 13.2 million in 2021. Finance cost totaled USD 32.6 million up by USD 11.8 million between years.

A net currency exchange loss of USD 5.5 million was included in the finance cost in 2022. Fair value changes were negative by USD 0.6 million in 2022 compared to positive changes of fair value in 2021 of USD 8.2 million.

The booking pattern is gradually returning back to normal with all Icelandair markets showing robust performance during the important booking period at the start of the year. All markets are performing well with North America showing significant strength. The development of the air freight hub in Keflavik creates additional growth opportunities and the outlook for the leasing operations is strong.

The operating environment of Icelandair will however remain challenging due to bleak global economic outlook, higher inflation as well as higher labor cost, and historically high fuel price. The EBIT margin guidance for the year is between 4% and 6%. The guidance for the year assumes an average exchange rate of USD against the ISK of 136, the price of fuel (net of hedging) at USD 950 per metric ton, and ETS per unit at EUR 90.