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changed its name to Flugfélag Íslands, where it acquired another Waco aircraft and was relaunched in 1940 as Flugfélag Íslands, which translates as Flight Company of Iceland. Seaplane flights were operated in the vicinity of Vatnsmýri in Skerjafjörður and Vatnagarðar. Previously, two unrelated airlines of the same name (Flugfélag Íslands) had existed in the country (from 1919 to 1920, and between 1928 and 1931). For international purposes, the name Iceland Airways was adopted.

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