Aeroflot Group Consolidated financials (IFRS) 9M2011 · 2018. 11. 9. · Travel magazine and...

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Цвета заливки графиков и фигур

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Цвет контура

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Цвет текста

Настоящий документ был использован для сопровождения устного доклада и не содержит полного изложения данной темы.

Aeroflot Group

Consolidated financials (IFRS)

9M2011

Moscow

December 20, 2011

Speaker:

Shamil Kurmashov

Deputy Director General

Finance and investments

R: 182

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R: 22

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G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

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Table of contents

1.Introduction

2.Market position of the Group

3.Operating highlights

4.Financial results

5.Conclusions

6.Appendix

2

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G: 157

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R: 22

G: 44

B: 66

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G: 178

B: 178


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Key highlights for the 9 month 2011

• November 15, 2011 JSC “Aeroflot” completed the transaction of receiving airlines owned by State

Corporation “Russian Technogies”. LLC “Aeroflot-Finance” received stakes in JSC “Vladivostok Avia”

(52.156%), JSC “Saratov Airlines” (51%), JSC “SAT Airlines” (100%), JSC “Rossiya Airlines”(75% minus 1

share) , JSC “Orenburg Airlines” (100%) in exchange for 3.55% stake of charter capital of JSC “Aeroflot –

Russian Airlines”.

• Aeroflot received the award «Russian Business Travel & MICE Award» in category «Best company for

business travelers». «Russian Business Travel & MICE Award» is an annual award established by Business

Travel magazine and internet portal Conference.ru.

• Aeroflot was awarded by SAP Company for best implementation SAP’s products in transport sector. SAP

ERP system has been implementing in JSC ‘Aeroflot” since 2009.

• According to the rating of the Boston Consulting Group (BCG) – the world leader in operating consulting and

business strategy developing, JSC “Aeroflot” took seventh place among top ten transport and tourist

companies. Pursuant to the research total shareholder return, volume of sales, margin performed certain

growth in recent years.

• Aeroflot took first place in roadmap of innovation development award “ROADMAP 2011”. Aeroflot’s

innovation projects are carried out in cooperation with relevant universities, scientific organizations and

entities of small and medium business.

3

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

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Table of contents

1.Introduction



4.Financial results

5.Conclusions

6.Appendix

4

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


22.0 24.0 28.0 32.0

35.0 38.0 45.0 50.0 45.1

57.0 49.4

63.5

11.6 11.1 14.1 11.8*

2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 9m2011 2011E

Source: TCH***, Ministry of Transportation

Source: TCH Source: TCH

Market share of the Group for 9m2011

[% of passenger turnover]

Market share of the Group for 6m2011

[% of passenger traffic]

Passenger traffic of the Russian civil aviation

[mln. pax.]

• At the end of 9 months of 2011 the share of Aeroflot Group in RCA amounted for 23,8%

• According to the Ministry of Transportation the estimated passenger traffic of RCA will reach about 63.5

million people, which is 11% more than in 2010

23.2% 24.6%

24.8%

RCA** Aeroflot Group market share in RCA Aeroflot Group

23.8%

Russian air transportation market

* Passenger traffic of the Group includes passengers carried by Aeroflot, Donavia for 9m2011 and by Nordavia as of 10.06.2011.

5

26.2 29.2 21.7

Total IAL DAL

23.8 28.3

19.5

Total IAL DAL

*RCA – Russian civil aviation

**Transport Clearing House

IAL – International airlines

DAL – Domestic airlines

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Source: IMF, Ministry of Transport of the Russian Federation

2,3

3

1,1

0,3

1

0 1,5 3

Development potential of the Russian air

transportation market

2010 2025

UK

USA

Europe

Russia

4%

1,7% 1,5%

3,7% 3,3%

Source: Bloomberg

• The Russian air transportation market has a significant growth potential due to forecasted GDP increase,

which exceeds other countries’ expectations

• As per Ministry of transportation the estimated mobility index could reach the same level as this of EU

countries by 2025

Source: TCH, Ministry of Transportation

Passenger traffic of the Russian civil aviation

[mln. pax.]

Trips per capita GDP Growth Projections for 2011

[%]

6

22 24 28 32 35 38

45 50 45 57 61

78

2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2011E 2013E

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Market position of the Group

Passenger traffic [mln.pax.] Passenger turnover [bln.pkm.]

Growth rates of basic operating indicators

[%, 9m2011 to 9m2010]

Source: TCH Share in RCA Source: TCH

Source: АЕА, estimates of Aeroflot

* АЕА – Association of European Airlines (scheduled flights data)

• Aeroflot is the leader of the Russian Civil Aviation

• The growth pace in operational performance of Aeroflot Group exceeds the dynamics of

Association of European Airlines 7

33,3

24,9

10,4 8,0

5,5

Aeroflot Group Transaero S7 Group UTair Orenavia

26,2%

19,6%

8,2% 6,3%

4,3%

11,8

6,6 4,9 4,2

2,7

Aeroflot Group Transaero S7 Group UTair RossiyaAirlines

23.9%

13.3% 9.9% 8.5%

5.5%

11,9 8,8 9,3

6,3 11,7

8,5

Aeroflot Group АЕА*

Passenger capacity (ASK) Passenger traffic (PAX) Passenger turnover (RPK)

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Table of contents

1.Introduction



4.Financial results

5.Conclusions

6.Appendix

8

R: 182

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B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

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B: 0

R: 255

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B: 0

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B: 120

R: 0

G: 128

B: 0


0

5000

10000

MiddleEast

Europe Russia CIS &Baltic

mln

ask

0

4000

8000

America Asia Russia

mln

ask

Route network – schedule for winter

2011/2012

9

+17%

+30%

+16%

+20%

+25% +38%

+51%

Schedule «Winter10/11» Schedule «Winter 11/12»

• From January till September of 2011 Aeroflot operated its own flights to 127 destinations in 54 countries

• Apart from the flights of its own from Sheremetyevo Airport, the Company operates 134 flights under code

sharing agreements

• The transit passenger traffic of the Company increased by 19% during the nine months of 2011 compared

to the same period of 2010 and amounted to 3.93 million passengers, or 34.7% of the total passenger

traffic volume of the company

0

333

0

400

mln

ask

9

Planned ASK increasing according to the winter schedule 2011/2012

ASK increasing break-down by regions in the winter schedule 2011/2012

Long-haul destinations Middle-haul destinations Regional destinations

16%

27%

DAL IAL

Long-haul destination

38%

28%

DAL IAL

Middle-haul destinations

+333 mln

DAL

Regional destinations

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Fleet of the Group as of 30.09.11

• The operated fleet includes mainly modern fuel-efficient aircraft. As of the end of September 2011 69%

of the Group's aircraft were under operating lease agreements, 25% – under financial lease agreements

• The average age of Aeroflot’s aircraft in operation is 5,2 years

Type of aircraft Aeroflot Donavia Total

Ilyushin Il-86 1* 1

Ilyushin Il-96-300 6 6

Tupolev Tu-154 1* 1

Total number of aircraft owned 7 1 8

Airbus A-319 4 4

Airbus A-320 1 1

Airbus A-321 18 18

Airbus A-330 2 2

Boeing 737 5 5

Total number of aircraft under finance lease 25 5 30

Airbus A-319 11 11

Airbus A-320 42 42

Airbus A-330 10 10

Boeing B-737 5 5

Boeing B-767 9 9

McDonnell Douglas MD-11 3 3

SSJ 100 2 2

Total number of aircraft under operating lease 77 5 82

Total number of aircraft 109 11 120

* As of 30.092011 operation of this aircraft was terminated

10

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Order and phase off plan of JSC

“Aeroflot”

By the year 2015 Aeroflot is planning to replenish its fleet with 87 modern aircraft.

Delivery schedule in accordance with contracts in force

Phase off schedule of aircraft

Type of aircraft 2011 2012 2013 2014 2015

Regional

SSJ-100 6 14 2 8 -

Medium-haul

A-320 8 - - - -

A-321 - 3 5 - -

Long-haul

A-330 4 8 - - -

B-777 - - 4 6 3

B-787 - - - 8 8

TOTAL 18 25 11 22 11

Type of aircraft 2011

Medium-haul

Il-86 1

TOTAL 1

11

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G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


243,8291,3

9m2010 9m2011

Fleet efficiency of JSC “Aeroflot”

• In the nine months of 2011 the Company increased its flight hours by 19.5% compared to the same

period in 2010

• Fuel consumption per ton-km rose insignificantly by 2.9% year-on-year as a result of reduction in the

average flight distance due to increased operations on domestic flights

Flight hours [ths.hours] Specific fuel consumption [gr/tnkm]

Weighted average fuel price of JSC “Aeroflot” [$/tn]

+19,5%

+2,9%

311 320

9m2010 9m2011

12

546

468 474 476 482 494537 525

575 585623 647

630 635 642663 651 626 634 650 637 648

668708

759809

859 870896 896 904 892 886 893

300

400

500

600

700

800

900

1 000

2009 2010 2011

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Headcount and labor productivity

• The labor productivity of JSC "Aeroflot" and Aeroflot Group performed growth of in the nine months of

2011

• The headcount of JSC "Aeroflot" increased by 8% due to the enhanced cabin crew on the back of

growing aircraft fleet and number of work done

Passenger turnover/Average

headcount [mln.pkm/units]

Passenger traffic/Average

headcount [ths.pers./units]

9m2010

9m2011

+11% +10% +7%

Labor productivity

Revenue/Average headcount [$ ths./units]

+18% +22%

* Headcount of CJSC “Nordavia” as of 31.05.2011 totaled 1 351

+14%

Headcount 30.09.10 30.09.11 vly

Aeroflot 14 001 15 171 8%

Aeromar 2 079 2 262 9%

Donavia 1 470 1 090 -26%

Nordavia 1 344 0* -100%

Terminal 721 681 -6%

Aerofirst 465 388 -17%

Sherotel 283 278 -2%

Aerofot-Finance 2 4 100%

TOTAL 20 365 19 874 -2%

13

2,0 1,57 2,2

1,73

JSC "Aeroflot" Aeroflot Group

0,66 0,57

0,75 0,61


214 167

253 203


R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Operating indicators of Aeroflot Group

Passenger traffic

[ths.pax.]

Seat load factor

[%]

Passenger turnover

[mln.pkm.]

• In spite of the sale of CJSC "Nordavia" in June 2011, the majority of operational performance measures are higher than the previous

years indicators

• Minor arrears in the seat load factor compared to 2010 could be explained by introduction of new long-haul transportation and,

consequently, by increasing passenger capacity

Passenger capacity

[mln.pkm.]

14

740

634 721 750

909

1 025

1 175 1 219

1 084 996

884 926 941

876

1 008 992

1 199

1 365

1 506 1 519

1 363

1 229

1 055 1 019

1 063

1 005

1 157 1 203

1 315

1 417

1 571 1 577 1 459

1 338

2 132

1 773 1 960 1 984

2 351

2 675

3 128 3 312

2 930 2 758

2 436 2 469 2 667

2 443

2 832 2 769

3 204

3 705

4 211 4 207

3 794

3 428

2 944 2 903

3 123

2 889

3 275 3 339 3 588,5

3 960

4 509 4 529

4 115

3 787

60,9 60,5 62,2 62,0

65,9

72,4

78,6

81,3

77,7

74,4

69,4 69,9 70,1

72,7 74,6 75,4

75,9 77,9

84,9

83,4 81,2

79,3

72,6 71,0 70,9

73,4 75,1

76,3

74,9

77,5

83,7

84,4

80,6

78,5

3 430

2 926

3 222 3 183

3 557

3 687 3 975 4 072

3 765 3 694 3 500 3 603

3 789

3 365

3 797 3 674

4 217 4 676

4 990

5 039 4 705

4 405

4 054

4 092

4 403

3 935

4 364 4 378

4 790

5 110

5 389 5 369 5 079

4 824

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Revenue rates

The revenue rates of the Group grew up in the nine months of 2011 reflecting the increased

demand for Aeroflot Group services in the passenger transportation market

Yield

PAX revenue / RPK

[US cents / pkm.]

RASK

PAX revenue / ASK

[US cents / ask.]

Cargo yield

Cargo revenue / CTK

[US cents / tkm.]

+8% +9% +7% +7% +14% +13%

15

6,6 6,7

7,2 7,2


8,4 8,6

9,1 9,2


25,3 25,7

28,8 29,0


R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


JSC “Aeroflot” operating indicators

dynamic by region

• Following the approved strategy of strengthening positions on the popular tourist directions, Aeroflot

significantly increased its long-haul transportation capacities. The largest growth was demonstrated in

Europe, Asia, Russia and CIS

• Growth rates of passenger capacity temporarily exceeds the passenger turnover as a result of growing

presence in the Asian market

* according to management accounting.

* *

* *

[%, 9m2011 vs 9m2010]

*

16

+17.0% +14.8%

+1.9% +4.3%

RPK ASK SLF Yield

America +20.4%

+17.6%

+2.4% +5.0%

RPK ASK SLF Yield

Europe

+15.8% +15.3%

+0.5%

+17.9%

RPK ASK SLF Yield

Russia & CIS

+4.4%

-0.3%

+4.8%

+13.3%

RPK ASK SLF Yield

Middle East & Africa

+32.2% +37.1%

-3.6% -3.0%

RPK ASK SLF Yield

Asia

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Traffic revenue of Aeroflot Group by

region

The substantial growth in revenue from scheduled passenger carriages is observed primarily

due to the growing traffic capacity of the Group in Asia, Europe and Russia

Revenue from regular passengers carriages

[$ mln.]

Revenue from regular cargo carriages

[$ mln.]

+21% +4%

17

2 515

3 047

286 116 15 48

67 178

185 1

0,2

7 3

4

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Table of contents

1.Introduction



3.Financial results

4.Conclusions

5.Appendix

18

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Key financials

• The revenue of JSC "Aeroflot“ increased by 27% and the operating profit by 16%

• EBITDA of JSC "Aeroflot“ and Aeroflot Group went up by 14% and 2% respectively

• The net income of JSC "Aeroflot“ grew by 35%, while that of the Group – by 37%

* EBITDAR = EBITDA + Operating lease expenses

** EBITDA = Operating income + Amortization + Custom duties

Index unit JSC “Aeroflot” Aeroflot Group

9m2010 9m2011 vly 9m2010 9m2011 vly

Revenue $ mln. 2 793 3 560 27% 3 160 3 919 24%

Operating costs $ mln. 2 335 3 031 30% 2 692 3 455 28%

EBITDAR* $ mln. 808 910 13% 888 912 3%

EBITDA** $ mln. 585 668 14% 641 653 2%

Operating income $ mln. 458 529 16% 468 464 -1%

Net income $ mln. 350 472 35% 281 384 37%

EBITDAR margin % 29% 26% -3 p.p. 28% 23% -5 p.p.

EBITDA margin % 21% 19% -2 p.p. 20% 17% -3 p.p.

19

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Aeroflot Group’s financial indicators

dynamic

EBITDAR increased by 3%. Net income grew up by 37%.

Key financial indicators of the Group

[$ мmln]

+3%

+28%

+24%

9m2010 9m2011

+37%

20

3 160

2 692

888

281

3 919

3 455

912

384

Revenue Operating costs EBITDAR Net income

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


• The main financial indicator of JSC “Aeroflot” demonstrated a stable growth during the nine

months of 2011

• EBITDAR raised by 13%, while the net income of JSC "Aeroflot" increased by 35%

Dynamic of the financial indicators of JSC

“Aeroflot”

Key financial indicators of JSC “Aeroflot”

[$ mln]

+27%

+30%

+13%

+35%

9m2010 9m2011

21

2 793

2 335

808

350

3 560

3 031

910

472

Revenue Operating costs EBITDAR Net income

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


428653

178185

2 554

284

250225

3 081

Group’s revenue factorial analysis

• The substantial increase in Aeroflot Group’s revenue is caused primarily by the growing passenger

traffic

• Other income rose by 53% as a result of Aerofirst consolidation and Terminal’s revenue growth

Revenue of the Group

[$ mln] Traffic

volume

Air carriage

tariff Others

Passenger traffic + 21%

Freight traffic + 4%

Other income + 53%

Σ 3 160 Σ 3 919 Total revenue of the Group + 24% 9m2010 9m2011

22

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


472

384

12 4

98 9 50 24

19 4 56

40

Structure of the Group’s net income

• Financial result of the Group was significantly affected by deconsolidation of the accumulated losses

from disposal of subsidiaries and associates

• JSC “Terminal“, subsidiary company, undertook a significant loss due to the foreign exchange effect

Elements of Aeroflot Group’s net income

[$ mln]

* Financial result from deconsolidation of accumulated loss from disposal of subsidiaries and associates.

** Elimination of released in Aeroflot debt provision of Aeroflot-Cargo

*** Including elimination of intercompany balance .

23

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


350

472

431

245 89

102

364

146

186 31 18

Factorial analysis of the net income of

JSC “Aeroflot

• The revenue grew due to the raised traffic volumes as well as higher tariffs. Increase in

operating income exceeded the increase in operating expenses

• The net profit of the Company was positively affected by the sale of Nordavia, "Moscow"

Insurance Company" and "TZK "Sheremetyevo" companies

Alteration of the net income of JSC “Aeroflot”

[$ mln]

* The main share is attributed to the revenue from fueling and income from airline agreements

** Profit from disposal of investments in associated and subsidiary

24

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


281 384

284

250

225

200

335

154

274 77

9 7

Factorial analysis of the Group’s net

income

• The growth of non-aviation revenue is stipulated primarily by Aerofirst consolidation and

increase in income of JSC “Terminal”

• Financial result of the Group was positively affected by the disposal of "Nordavia",

"Moscow" Insurance Company" and "TZK "Sheremetyevo" companies

Alteration of the Group’s net income

[$ mln]

* The main share is attributed from revenue of duty free trading , fueling, airport services and income from airline agreements

** Including financial result from selling of investments in subsidiaries and affiliates and deconsolidation of accumulated loss

25

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Operating income of the subsidiaries

• Significant operating loss of JSC “Donavia“ is caused by reorganization of route network

and cancellation of charter flights from/to Sheremetievo

• During the nine months of 2011 JSC "Terminal" received operating profit in amount of $52

million

9m2010

Operating income / loss of the subsidiaries

[$ mln]

9m2011 * Is primarily stipulated by operating loss of CJSC “Aerofirst”

26

6

(9)

15

4

(9)

(0)

(24)

(4)

16

6

52

(8)

JSC"Donavia"

CJSC"Aeroflot-Cargo"

CJSC"Aeromar"

CJSC"Sherotel"

JSC"Terminal" Other companies*

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


TOTAL DEBT / EBITDA* [x]

Debt leverage of Aeroflot Group

• The debt leverage of JSC ‘Aeroflot’ and the Group is rather low

• Following the deconsolidation of JSC “Terminal” planned in the fourth quarter of 2011, the Total

Debt/EBITDA ratio should decrease from 3.1x to 2.2x

NET DEBT / EBITDA* [x]

Aeroflot Group JSC “Aeroflot” Group debt leverage excluding Terminal

* EBITDA is annualized.

Indicators unit JSC “Aeroflot” Aeroflot Group

31.12.10 30.09.11 vly 31.12.10 30.09.11 vly

Borrowings $ mln. 402 438 9% 1 313 1 372 4%

Finance lease liabilities $ mln. 719 831 16% 734 840 14%

Pension liabilities $ mln. 14 13 -7% 14 13 -7%

Custom duties $ mln. 89 3 -97% 91 3 -97%

Total debt $ mln. 1 224 1 285 5% 2 152 2 228 4%

Cash and short term investments $ mln. 668 639 -4% 666 559 -16%

Net Debt $ mln. 556 646 16% 1 486 1 669 12%

4,1

2,8

2,32,1

1,7

2,32,0

1,10,9 0,9

0,3

0,9

1,3

31.12.09 30.06.10 30.09.10 31.12.10 30.06.11 30.09.11

27

4,4 4,0

3,2 3,0 2,9

3,1

2,2 2,6

2,1 1,9

1,7 1,8

2,2

31.12.09 30.06.10 30.09.10 31.12.10 30.06.11 30.09.11

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


19%

10%

4%

13% 16%

9% 6%

8%

Aeroflot Group DeutscheLufthansa

Air France-KLM Turkish Airlines

3.3 3.5

12.1

2.7 3.2 2.2

6.6

9.1

Aeroflot Group DeutscheLufthansa

Air France-KLM Turkish Airlines

Indicators unit 9m2010 9m2011 vly 9m2010 9m2011 vly 9m2010* 9m2011* vly 9m2010 9m2011 vly

Financial indicators Revenue $ mln. 3 160 3 919 24% 26 495 31 199 18% 22 828 25 837 13% 4 131 5 183 25%

EBITDA** $ mln. 604 629 4% 2 703 2 727 1% 984 1 528 55% 538 398 -26%

Net income $ mln. 281 384 37% 646 437 -32% 356 -766 -315% 167 -307 -284%

Total Debt*** $ mln. 2 002 2 212 10% 10 053 8 298 -17% 14 870 14 333 -4% 1 917 4 239 121%

Operating indicators Passenger turnover bln.pkm 30 33 10% 146 158 8% 152 163 7% 36 43 19%

Passenger capacity bln.ask 38 43 13% 183 203 11% 186 199 7% 48 60 25%

Seat load factor % 78% 78% 0% 80% 78% -2p.p. 82% 82% 0% 74% 73% -1p.p.

• Revenue of the Group increased by 24%, exceeding the performance of major European airlines.

Moreover, Aeroflot Group demonstrates one of the highest EBITDA margin

• Growth rates of the Group’s operating indices exceed those of numerous major European companies

9m2010

In comparison with European airlines

DEBT / EBITDA [x] EBITDA margin [%]

* Financial and operating indicators for the period form January, 1 till September, 30 of 2011

** EBITDA = Operating income + Amortization

*** Total Debt = Borrowings + Financial lease liabilities

9m2011

Source: Bloomberg

28

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Table of contents

1.Introduction



4.Financial results

5.Conclusions

6.Appendix

29

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Conclusions

• The nine months of 2011 resulted in growth of main operating indicators. The actions

taken to refine the route network as well as wise revenue rates management speeded up

the operating and financial indicators growth during the nine months of 2011

• Revenue of Aeroflot rose by 27% compared to the same period in 2010, operating profit

rose by 16%. EBITDA of JSC ‘Aeroflot’ and the Group increased by 14% and 2%

respectively. The net profit of JSC "Aeroflot“ went up 35%, while that of the Group – 37%

• The debt leverage of JSC ‘Aeroflot’ and the Group is rather low. Following the

deconsolidation of JSC “Terminal” planned in the fourth quarter of 2011, the Total

Debt/EBITDA ratio should decrease from 3.1x to 2.2x

30

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Table of contents

1.Introduction



4.Financial results

5.Conclusions

6.Appendix

31

R: 182

G: 196

B: 204

R: 135

G: 157

B: 179

R: 59

G: 100

B: 135


R: 22

G: 44

B: 66

R: 178

G: 178

B: 178


R: 0

G: 176

B: 80

R: 0

G: 112

B: 192

R: 255

G: 255

B: 255

R: 0

G: 0

B: 0

R: 255

G: 0

B: 0

R: 1

G: 40

B: 120

R: 0

G: 128

B: 0


Operating indicators

The nine months of 2011 resulted in growth of main operating indicators compared to the same

period in 2010

Indicators unit JSC “Aeroflot” Aeroflot Group

9m2010 9m2011 vly 9m2010 9m2011 vly

Passenger turnover mln.pkm 26 252 31 552 20% 29 832 33 328 12%

international flights 17 732 21 728 23% 19 043 22 293 17%

domestic flights 8 520 9 824 15% 10 789 11 035 2%

Passenger capacity mln.ask 33 659 40 225 20% 38 252 42 817 12%

International flights 23 073 27 953 21% 24 590 28 702 17%


Cargo tonne mln.tkm 3 049 3 469 14% 3 379 3 635 8%


domestic flights 919 1 017 11% 1 130 1 131 0%

Passenger traffic ths.pax. 8 533 10 541 24% 10 769 11 769 9%



Cargo / mail tonne 118 345 111 927 -5% 123 600 115 525 -7%

International flights 88 321 84 063 -5% 88 614 84 348 -5%

domestic flights 30 024 27 864 -7% 34 986 31 177 -11%

Seat load factor % 78.0% 78.4% +0.4 p.p. 78.0% 77.8% -0.2 p.p.

International flights 76.8% 77.7% +0.9 p.p. 77.4% 77.7% +0.3 p.p.

domestic flights 80.5% 80.1% -0.4 p.p. 79.0% 78.2% -0.8 p.p.

Налет ВС часов 243 774 291 343 20% 284 063 327 077 15%

32

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