February 2002. But cancellations continued to rise, and in November the company's subsidies from the ministry were reduced due to lack of performance. In December 2001, Guard Air was forced to terminate all operations, and a new PSO tender was made for the services to Fagernes. Along with Arctic Air, Widerøe and DAT, Coast Air made a bid. The contract was won by Arctic Air. With the next round of PSO contracts, valid from 1 April 2003 through 31 March 2006, Coast Air lost the Florø contract to DAT, but succeeded at winning the contract for Fagernes for NOK 10 million per year. Following the 2005 announcement of the PSO contracts from 1 April 2006 to 31 March 2009, Coast Air was awarded three contracts. In addition to retaining the Fagernes route, it also received the concession for the Røros and Andenes routes. The three routes gave NOK 35 million in annual subsidies. Røros and Andenes would be served by ATR 42-aircraft, while Jetstreams would be used to Fagernes. From 30 January 2007, the company also started flying from Røros to Trondheim twice a week. From 1 April 2007, Coast Air canceled their flights to Andenes. Since the operations were separated from the rest of the network, it was not possible to fly profitably. Widerøe subsequently took over the route. During July 2007, Coast Air introduced the smaller Jetstream aircraft on the routes to Røros. Financial problems Following the loss of the Fagernes route, Coast Air relocated its services to the Bergen–Skien and the Haugesund–Aberdeen route in 1997. After Air Stord filed for bankruptcy in February 1999, Coast Air and Teddy Air both started flights from the airport to Oslo. Coast Air also expanded Kristiansand as a hub, with additional routes to Stavanger, Haugesund and Gothenburg in Sweden. In January 2000, the company announced that it was not making any money on the Kristiansand routes, and immediately terminated all four services. Coast air carried 50,000 passengers in 1999. After having made small profits ten years in a row until 1998, Coast Air had a loss of NOK 18.6 million and a revenue of NOK 40.5 million in 1999. To increase liquidity, the company sold two of its four Jetstream 31 aircraft. The establishment in the PSO market was expensive for Coast Air, and the airline lost NOK 9.7 million in 2000. To counteract, the company's owners chose to perform a