High fuel prices and the strength of the dollar is expected to have a “partly negative” impact on annual financial results for Norwegian Air.
The carrier is trimming capacity by 25% from at fleet of 70 aircraft as it heads into the winter.
The airline plans to increase its fleet fleet to 85 aircraft for next summer.
Disclosing a third quarter pre-tax profit of NOK 910 million (£76 million), the Scandinavian low cost carrier said: “Consumer demand for air travel may be impacted by recent high inflation and increasing interest rates.
“However, current booking trends are encouraging, although visibility is low with many customers booking travel close to date of departure.
“For the upcoming winter season, the company has flexibility by power-by- the-hour (PBH) lease agreements on close to 30% of its fleet. This allows the company to optimise capacity to seasonal fluctuations in demand.
“Compared to the end of the third quarter of 2022, the company is projecting a capacity reduction of approximately 25% for the coming months.”
However, the carrier added: “With strong brand loyalty, a solid organisation and robust financial situation, Norwegian is well positioned to tackle short-term fluctuations in demand and to benefit from long-term expected improvements across key markets.”
Business travel has picked up after the summer, and travellers in this segment are now back to 2019 levels on the most popular domestic routes in Norway, according to the airline.
Strong pent-up demand for the peak summer travel season and the third quarter as a whole was reported, with a peak load factor in July of 95% as more than six million passengers were carried in the three months against 2.5 million in the same period last year.
The carrier added that “despite record-high congestion and industry challenges across European airports, nearly all scheduled flights were operated”.
Chief executive Geir Karlsen said: “This quarter has demonstrated that we are the reliable Nordic option for customers travelling on their holidays, to visit friends and family, or for business purposes.
“Many corporate customers choose to fly with Norwegian, and the number of business travellers is now on par with pre-pandemic levels for our most popular domestic business routes.
“Demand is expected to soften as we enter the winter trading period, but Norwegian is well prepared for this through flexible fleet arrangements, rigorous route planning and sound collaboration with our colleagues and unions.
“While demand for air travel may be impacted by the current macro-economic and geopolitical uncertainty, booking trends remain encouraging with an increasing number of passengers choosing to fly with Norwegian.”