Norwegian (Oslo Gardermoen) revealed on February 4 that it had shelved plans for a subsequent offering, otherwise known as a follow-on or repair offering in which additional shares are issued by a publicly-traded company. This was because the market price had fallen below the level where the LCC had sold new equity in November 2019.
The additional offering would have allowed smaller shareholders who had not been invited to take part in the main share sale late last year to maintain an unchanged stake in the company, Reuters news agency explained. But as the share price had dropped below the earlier offer price of NOK40 Norwegian kroner (USD4.33), these investors were free to buy shares at a cheaper rate on the stock market.
Norwegian traded at NOK35.86 (USD3.88) on February 4. However, its shares rose by almost 6% in early trading on February 6, Reuters subsequently reported, as news emerged that its turnaround - in which it has removed unprofitable routes and raised income from existing ones - appeared to be yielding results. Shares traded at NOK39.66 (USD4.29) early on February 6 but were still down 46% in the last 12 months.
The airline said in its monthly traffic report that its yield had risen by 15%, on the back of capacity dropping by a bigger-than-expected 29% in January from the same month a year earlier.
“I am pleased that we continue to deliver on the strategy of moving from growth to profitability,” chief executive Jacob Schram, who has been in his position since January 1, said in a statement.
