Norwegian Air Shuttle AS reported a wider annual loss than analysts had predicted as the Scandinavian low-cost airline’s rapid expansion and fuel hedging for 2015 weighed on earnings. The stock fell to a three-month low.

The net loss in 2014 was 1.05 billion kroner ($137 million) compared with profit of 321.6 million kroner a year earlier, the Fornebu, Norway-based company said in a statement. The loss was greater than the 686.4 million-krone average of eight analyst estimates compiled by Bloomberg. Operating revenue gained 25 percent to 19.5 billion kroner.

Norwegian Air is pursuing one of the industry’s most ambitious growth plans, rolling out a long-haul operation with Boeing Co. 787 planes while swelling its European fleet. Flight- permit delays in the U.S. generated 54 million kroner in expenses in the fourth quarter, with the depreciation of the Norwegian kroner against the dollar and euro contributing to a 3 percent increase in unit costs, the carrier said.

“There is no denying that 2014 has been a weak year for Norwegian,” Chief Executive Officer Bjoern Kjos said in the statement. While 2015 demand is “satisfactory” and the carrier is benefiting from lower fuel prices, “there is no doubt that we need to further reduce our cost level in order to stay competitive.”

Norwegian Air dropped as much as 17 percent to 224.8 kroner, the lowest intraday price since Nov. 5, and was trading down 16 percent at 9:41 a.m. in Oslo. The stock has fallen 19 percent this year.

The airline carried 5.65 million passengers in the fourth quarter, a 7.6 percent increase from a year earlier. Ticket revenue per unit fell 3 percent in the period, and dropped 10 percent in the full year, as average fares declined.

Fuel expenses rose 11 percent in the fourth quarter, while the cost of contracts to fix spending on jet kerosene this year totaled 459 million kroner last year, the company said. Fuel needs for this year are 30 percent hedged at an average price of $815 a ton, it said.

To contact the reporter on this story: Kari Lundgren in London at To contact the editors responsible for this story: Benedikt Kammel at Tom Lavell, Thomas Mulier.

This article was written by Kari Lundgren from Bloomberg and was legally licensed through the NewsCred publisher network.

Photo Credit: A Norwegian Air Shuttle gets ready for flight. Aero Icarus / Flickr