Good morning everyone, welcome to Norwegian's presentations of the second quarter results, and to the press conference about the change in top management that we have announced this morning. My name is Anne-Sissel Skånvik, I'm the Chief Communications Officer. As you will see from the agenda here, we will start with the presentation of the results, presented by Bjørn Kjos and Geir Karlsen. We have a plenary session with the Q&A to the figures only, before we continue with the press conference. Be aware that both the quarterly presentation and the press conference will be in English, as we will stream it to the international audience. All questions will be in English. I hand over to you, Bjørn, for the presentation.
Thank you. Hopefully my last presentation. If you think I'm sorry for that, I'm not. I'm way overdue. I'll just go straight ahead. I think we have reached very good this year. If you look at what we have achieved here, we have actually doubled the result on the EBITDAR, excluding other losses and gains from NOK 1,164 to NOK 2,238. That has happened by improving the unit revenue by 13%, and very good. It's primarily driven by long-haul, and of course we have a positive Eastern effect. We are on track because when we, you will see later when we take off the expansion, it's very easy that you will be killed by the cost. We are on track with the costs, NOK 554 million in cost reduction in the second quarter.
We will definitely reach NOK 1 billion year-to-date, and we are on track to reach our targets. Improving punctuality despite 18 MAXs on the ground. That's a very good achievement by the people that runs the daily operation. Of course, we have as always, got a lot of awards. World's Best Low-Cost Long-Haul Airline by Skytrax. That was very good. I think it was fifth years in a row. Also voted by Europe's Leading Low-Cost Airline by World Travel Awards. Yes, we have grounded several of the MAXs. The number of deliveries of course, have to come down because they are parked and cannot fly to U.S. It will go down from 16 to, we are not sure if it's six or four. Obviously that will take down the CapEx to a large extent.
We have also signed an agreement for the sale of additional NGs with a cash effect of NOK 21 million. Depending how many NGs we sell, it depending on how many MAXs actually we get. There is a huge appetite for the MAXs. We have added two Dreamliners into our operation. The growth has come down from, of course, last year, second quarter, we received a lot of Dreamliners. We are finished with that now to a large extent. The growth have come down to 6% in this quarter and 7% of the RPK, and that gives us an 88% average on a rolling basis. We had 91.6, as you remember, load factor this last month, it's still improving.
What we are very happy of is, of course, we have seen a very strong development of, especially on the long-haul side. 19% revenue growth on a flat passenger development, as you will see. Obviously it's taken a hit by the grounding of the MAXs. We don't have the same amount of wet leases as that we have on the grounded MAX. Of course, a lot of the MAXs don't have the same seat arrangement as we have. That of course creates a problem for us. Nevertheless, we have been able to fly 10 million passengers this quarter. Market share is absolutely the largest carrier overall at OSL. It's more or less flat as you will see, except for the long-haul. Yes. I was coming back to the, of course on the long-haul. Long-haul is performing very well. This is extremely interesting.
To see if you see the transatlantic routes, that is actually the key revenue driver in our second quarter. If you see on the absolute revenue growth year-on-year in the second quarter, the U.S. this quarter is actually performing incredibly well. It has increased with NOK 800 million. That's very interesting. If you see to the right, the revenue split by origin in second quarter of 2019, you will see that actually the revenue from the U.S. side is now larger than the total revenue from Norway. That is extremely interesting, and it's a clear indication that actually our long-haul operation is now really starting to work. See our long-haul operation, around 60 routes, biggest European carrier into New York, Los Angeles. That's actually incredible after five years.
It's hard to believe that we are the biggest carrier as an example into New York. The long-haul now is really taking off. Short-haul is stable. Short-haul fleets, we have 6 remaining 787s for deliveries. How many MAXs we get here, that's actually hard to say. We will probably in 2019, at the maximum, get 6 MAXs, probably between 4 and 6. That means that we will have you will see a decline here, but that's because we have sold off NGs, and that's okay for the winter season. Of course they will have a hard time to pick up the deliveries into 2020 as well. We anticipate this will be the number. You will see us selling off NGs, and of course, we have also redeliveries of expensive leased aircraft that we leased in the start-up phase.
Sustainability and the emission is, of course, high on our agenda. This is actually very interesting. We have managed to decrease our emission per passenger kilometer by 30% since 2008. We are not greenwashing like a lot of other airlines just talking about it. It's very interesting. If you really want a flatbed, you double your emission. Obviously the fuel savings, I'll come back to that later. That's the most important any airline can do, fly on new aircraft. If we have a biofuel transition, yes, we can obviously lower our emission considerably. It's no problem to fly on 50/50 biofuel on these modern aircrafts. If you add on new technology, very important to have high load factors. The lower load factors you have, the more emission you have per passenger. You should actually have a high-density seating.
We don't have it, but still we carry a lot of passengers. We have looked at it many times to do carbon offsetting. The reason why we haven't done it before is actually a lot of these sites where you actually purchase your carbon offsetting is no good, but we have found now sites that is UN-certified, so that will work. Needless to say, we pay NOK 330 million into compensation for carbon offsetting each year. Actually we are doing a lot of things. The airline business is doing a lot of things. If you look at the carbon emission, you will see that we are by far the best in class. Every passengers fly 44 km compared to if they fly per liter fuel, almost the double of the length compared to, as an example British Airways and Lufthansa, and even SAS is way behind.
We are the ones doing it, not talking about it. Greenwashing, you should remember that, because that's most of the industry actually doing. Geir, your turn.
Is this on? On now? All right. Let's just jump into the P&L. As you can see, we have a top line of NOK 12.2 billion. We have an EBITDAR of NOK 2.2 billion, actually the highest EBITDAR ever. If you compare 2018 to 2019, you can say that in 2018 we had a few one-offs. We had some one-offs on the technical side due to renegotiated technical contracts, which we haven't any effect of in 2019. We also had a pretty high currency gain in last year that we don't have today. The Q2 results for 2019 is more like a clean results, I would say, and with a profit of NOK 111 million. IFRS, as we have been talking about earlier, has an effect of NOK 183 million negative in the 2019 and in the second quarter.
If you look at the revenue side and the unit revenues, it's very good news for us that the RASK is up 13%. The revenues are up 19% despite the flat passenger number. It's also very encouraging to see that this RASK development is actually dominantly taken by the long haul where we are actually having a yield increase of close to 20% compared to last year. The RASK is up 17%. That is very encouraging to see on the long haul part of the business. On the cost side, not very exciting to see that we're only reducing the cost with 1% currency adjusted. Have in mind that we had a one-off in the second quarter of 2018. Despite that, we are still able to take down the cost level in Norwegian.
If you look at the cost level quarter by quarter, it is having a positive trend, meaning that the cost level on the underlying business is coming down. We do expect that the underlying cost will continue to come down. I'll give you an update on the so-called #Focus2019 program a little bit later. Even the fact that we have 18 MAXes parked, we are still able to take down the cost level in the company, and we will continue to reduce the costs. I'm not going to go in detail here. A couple of comments. On the technical side, again, it's due to the one-time effect last year, so it is not as dramatic as it looks. The airport charges, ATC costs down 20%. That's a pure result of the #Focus2019 program that we are running.
Fuel costs is where they are, as you can see, and still at relatively high levels. #Focus2019 program. We are still on target. We have taken out NOK 554 million in cost savings in the second quarter, taking us up to NOK 1 billion for the let's say year-to-date. We are struggling a little bit on the crewing side to take out the effects that we want to take out. That's mostly due to the MAX situation, where we have a disturbance in the planning. On the technical side, we have had a good quarter when it comes to cost savings, and we have still a massive number of initiatives that we are working on. We do still believe that we will reach the target of NOK 2 billion. Also, despite the fact that we are taking down the capacity compared to the planned capacity a few quarters ago.
That's still the plan. The internal target is still above NOK 2 billion. Let's see when we get closer to Christmas on what we can achieve. This is just a bridge on how we calculate this NOK 554 million for the second quarter, which takes us then to the NOK 1 billion for the year-to-date. Over to the balance sheet. A couple of comments there. We have investment is NOK 2 billion. That's the shares that we have in Bank Norwegian. We have an accounts receivable of NOK 12 billion. That is at the peak level by the end of June.
That is the tickets sold that we will now get transferred into cash during the next eight weeks, where we have a burn down, as we call it, which means that our passengers are now these days traveling in the area of NOK 1.6 billion-NOK 1.7 billion a week. This is accounts receivable now sitting with the credit card acquirers, which will be transferred to cash over July and August. We are still in need of more credit card acquirer capacity, which we have been working on for the last months. We have onboarded two of them, new of them. One is already up running, and another one is coming up running in late August. This is very important for us, obviously, and as the revenues are also increasing over time, we need more capacity from these guys.
A huge portion of that NOK 12.7 billion will be transferred into cash during the next weeks, meaning through July and August when we have the peak season passenger-wise. If you look at the current debts, the short-term portion of the debt, that includes the bond maturing later this year. It also includes debts related to the aircraft that we have already sold but not delivered to the new owners. It also includes the IFRS effects on the outstanding portion of the leases, the principal outstanding portion on the leases that we have in the company. I know there's a lot of you that is thinking about the bond maturing, the bond maturity coming up now late this year. I just thought that I'll give you some bullets. I'm not going to go in detail into this, but this is sources to liquidity, as we call it.
The most important thing for Norwegian, and which I hope you see, is that the underlying focus is to make sure that the operational performance is getting better. I think, going out with the results today, I think it shows that we are on the right track. We have the best EBITA in Q2 ever, and I'm going to give you a little bit of a guiding as well for the EBITA figures that we are now looking forward to by the end of the year. Obviously, we have factored in some losses due to the MAX situation. I'll come back to that. In the P&L in Q2, we have a loss in the area of NOK 400 million built into the P&L. We are definitely affected by the MAX situation.
Going forward, not only in 2019 but also in 2020 and 2021, the only focus that we have in the company today is to make sure that the underlying operation of the company is getting better and profitable, obviously. We are also onboarding new acquirers these days, which means that the working capital should have a positive development going forward. The need for credit card acquirers is at the peak during the winter, actually. What we need to do now, and what we are going to do, is to bring new acquirers on board to give us the capacity we need, first of all, into the winter season coming up. We have a value in the Bank Norwegian. It's valued at approximately NOK 2 billion. That is close to liquidity for us. We don't necessarily need to own the shares in the bank.
We are very bullish on the bank. It's liquidity regardless, should it be needed. We are divesting aircraft that we don't need. We are taking down the capacity, the growth, and all the aircraft that we have sold so far has been sold either at book or with a profit, and clearly it frees up liquidity. We are still progressing on the so-called joint venture or partnership. I'll come back to that a little bit later. Another factor that you might know, at least some of you, we have quite high values in our departure and arrival slots. Only in Gatwick, those are by third parties evaluated to in the area of $300 million-$400 million. Just some food for thought for the one of you that is just thinking about the bond. Cash flow. Not that many comments to the cash flow.
You can see that you have purchases of proceeds. Most of that relates to the sale of 4 737NGs. That is done, NOK 950 million. On the principal repayments, let's say NOK 650 million of that relates to the debt associated to those 737NGs that are sold. We have paid down NOK 750 million in regular debt repayments. We have also then paid down NOK 800 million on the lease debt as such. CapEx. This time is actually by the reason of the MAX situation. What we're saying here now that we have taken delivery of four Dreamliners so far this year. We have one remaining one coming up or delivering now very late in July. Other than that, we do expect to take delivery of approximately 4 to 6 MAXs. The thesis now is that the MAXs will, at the earliest, be back flying in October. It could potentially be even later.
That means that as it looks now, we will take delivery of 11 MAXs in 2020. We have eight redeliveries of the old leases in 2020. As such, we have a three-aircraft net growth. On the 787, as I said, we have one left this year in July, the next one is coming in January. It's also likely that one of the 787s next year will be pushed out in time. That will be the last one delivering into the summer next year. On the Airbus side, we have five deliveries coming up, one this year, four next year. All of them are going on very long leases to Hong Kong Express, as you know. On financing, we will, going forward, focus on what I call export credit-supported facilities with attractive terms and relatively long repayment profiles. Outlook.
As I said, on the MAX situation, the thesis now, at least the working thesis in Norwegian, is that this will be back at the earliest in October. We have secured the capacity we need for the summer season by taking in wet leases. We are prepared to take 46 by the end of this year. Result impact in the second quarter is NOK 400 million, which is built into the P&L. Despite that, we are still able to come out with a profitable quarter. On the basis that these aircraft will be back flying in October, we are estimating another NOK 300 million loss from 1st of July until they are back in the air. We are obviously having a good and constructive dialogue with Boeing on the whole situation as such. Guiding.
As you can see, we are kind of forced to guide the cost side slightly up this quarter. This is mainly due to headwind on the currency side. That applies both to the underlying and also including fuel. The #Focus2019 program is still, as I said, on target. Of course, when you are taking down the capacity, it makes it a little bit more difficult to take out NOK 2 billion in nominal cost savings. That is still the target, and we expect to reach that target as well by the end of the year. The challenge is when we are taking down the capacity as we are now doing, to keep up on that reduction also on the cost side.
You should expect that we are going to take steps in order to do something on the cost side, even outside the 2 billion NOK cost savings. On guiding, I think in order to give you a flavor of how the second half looks. First of all, on the joint venture, that is progressing. We are still having a dialogue with the same partner. We have progressed, and we do expect to have clarity on this within weeks, not within months, but within weeks. There's no guarantee that this will materialize, but we are optimistic. I think that's what we can say. We would also like to guide this time on the EBITDAR, and we are guiding between 6 billion and 7 billion NOK in EBITDAR by the year-end.
That is potentially more than a double since last year, and it shows that this change of strategy, the change from growth to profitability, is starting to kick in. We started that in the third, fourth quarter last year. Takes time for all those steps to have an effect. We are now starting to see it on the underlying operational side. We do expect also that this will yield results throughout the rest of the year. That includes then the 6 billion to 7 billion NOK, also includes then a P&L loss of 700 million NOK due to the MAX situation. I think that ends my presentation.
We'll head over to the Q&A session. As Anne-Sissel said in her introduction, we'll now take the questions related to the Q2 presentation, and then we welcome questions related to the change in management after the press conference.
Can you share some light on the booking into Q3? It seems like the passenger book ticket is flat year-on-year and your capacity is still growing by some 5%. How is the mix? Is the Q3 still quite good? You write about short booking window now.
I can start to answer. You can fill it in. On long haul, it has looked very good on the second quarter. There's no change in that going into this third quarter. The problem is that when we have increased a lot of capacity in the long haul, it is in U.K., it's Paris, it's Spain, and it's in Italy and also out of U.S. The booking horizon, we can't see it from last year. The booking horizon in these countries are very short, actually, in some places within the month. That's why we don't have any history to look at. That's why it's difficult on the long haul, but we don't see any changes into that. As we stand here, we don't see any change in that pattern for the third quarter.
On the short haul, as expected, Sweden is slightly down due to the taxes that are implemented and the weak Swedish krona against the euro. This makes it much more expensive for the Swedish families to travel.
We see it's strong in Norway and also in Denmark, and slightly weaker in Finland. The battle here is actually where we have taken out capacity is in the Mediterranean and as an example, from Germany and south to Mediterranean. We have taken down a lot of capacity. We have taken down the capacity out of U.K. into Mediterranean. We see that obviously, U.K. is influenced by Brexit, no doubt about that. The good thing about it's much cheaper for the Americans to fly into U.K. now. Actually, we are doing quite well as you saw that on where we have increased so much out of U.S. Obviously, that's good for us that the dollar is strong against the pound, and we see a reflection of that on the bookings.
The bookings in the third quarter, I think the shortfall on the short-haul operation will be filled up by the long-haul operation. That's what we see as we speak. I don't know if you have more comments to that, Geir.
Secondly, with U.S. going so well on the long-haul side, I guess your currency mix will be more balanced on the top line. You're more U.S. dominated. If you could just run us through how you think about that one.
As you saw on the one slide there, you saw that the highest revenue generator now is actually from the U.S. I think it's getting more equalized on a U.S. dollar economy in the company. Still a huge portion of the expenses as well in the company is U.S. dollars, obviously.
If you give us a new EBITDA guidance range or a target range, whatever, how is long-haul fitting in there?
Well, first of all, we would have liked to give a more narrow range on that guiding to from NOK 6 billion to NOK 7 billion of EBITDA. The fact is that, due to the MAX situation and the lack of clarity on when these aircraft will be flying again, this is kind of the range that we can get. As I said, if you look at the RASK increase that we are seeing, it is actually dominated by the long-haul side of the business with RASK at an increase of 17% and a yield increase of 19%. As a blended, it's 13%. You can assume what we are doing on the short-haul side of it.
Okay. Last and final. The JV, you said that it's a matter of weeks. If you just give us a little bit more color on this one, if you can.
I think as I said last time, it is a three-party agreement more or less. It's ourself, it's the partner, it's also the manufacturer of the aircraft. Now we are discussing a structure with the partner. We have restructured the whole order, the delivery order, as you know, with first of all, Airbus. Now it's down to whether we can materialize or execute on the structure. We have progressed from last time, let's see. We are saying within weeks, let's see if we can make it happen. There's no guarantees, obviously. We are optimistic.
Thank you. Good luck, Bjørn, with the new role.
Thank you.
Hans-Jørgen Elnæs, Winair. The NOK 700 million MAX on ground costs, does they include idling pilots and crew while the aircrafts are not flying?
We utilize the crew, of course, to a large extent on the short-haul, on the NGs. The problems is what we have as an example in Finland, we have only MAXs. Obviously, that makes a lot of problems because we should have liked to have the crew maybe on other places, and that incur a cost outside, of course. This is what we think the NOK 700 million is what we have calculated that will hit us.
There is one question sent to the investor relations email. Alex Irving from Bernstein. "How confident are you that Norwegian has enough equity to prevent a further rights issue, and what are the biggest risks to this?
We have no intention of raising more equity. As you see, we expect by the coming months now, just the people fly is seeking between NOK 6 billion and NOK 7 billion just coming in from people traveling in the next four or five weeks. We do not. We just gave examples of how we could have access if we want to refinance the bond by switching over to collaterals, et cetera. There is a bunch of levers that we can take. That obviously we will work on in going forward. We haven't decided what levers we will take.
I think what we're seeing now on the operational side is that we are performing better. We have a really good second quarter, in my opinion. The third quarter looks good. We are guiding a doubling of the EBITDAR for the full year. During the whole first half, we have been working very hard in order to make sure that the coming winter is not getting even close as bad as the winter that we have behind us, which is absolutely critical. We will have a cash burn down of the receivables over the coming months that will give us a fresh and good liquidity. The capacity is taken down. As you have probably seen, we have pushed even more MAXes out in time, which has taken down the CapEx.
All what we are doing now is trying to make a room where we can get safely through the coming winter, including either refinancing whole or part of the bond. It will take us into early 2020 in a very good position and we will then turn this around to a profitable company. Obviously, there's a few things that needs to come into place the next two to three months in order for us to be able to execute on that plan. That's clearly the only thing we are working on these days.
Yeah. One more question for me. Just regarding the bases in Las Palmas and Tenerife South, it says that you might keep those bases after all. Can you give some light on what will be the reason behind that, to keep those bases instead of closing them down?
All we do is, we calculate the effect of what we are doing. It might be as good as an effect if we take down the capacity in the summertime and move it in some down into other places. Obviously, if we have ability to do that, it might actually be better to ramp it up where we really need it in the wintertime. That is the reason. It's been, should we do it, should we not do it? If we can move parts of the capacity to other places in the summer season, that's actually better.
I think that's it. We'll now have a two-minute break before we start the press conference. For those of you who are staying, we ask you to please be seated.
Thank you everybody for attending this.