Company presentation

Air Berlin PLC | February 2013 | Company presentation

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A.

AB company presentation l Feb 2013 2

Introduction to airberlin

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Market position as of 31 December 2012

airberlin – a strong European carrier


No. 2 in core market: Germany / Austria / Switzerland

No. 7 in Europe with 33.3 m guests in 2012

80% of airberlin guests on European routes, on the

short- and medium haul network

Network carrier focused on business & leisure travelers

Group revenue of EUR 4.31 billion

Positive operating result (EBIT) of EUR 70.2 million –

an improvement of more than EUR 300 million over the

previous year

Net profit of EUR 6.8 million

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0.5 0.8 1 1.1 1.4 1.6 2 3 4 6 7

10 12

14

19

25

29 28

34 35

Air Berlin Inc. was founded by the former PanAm captain Kim Lundgren in Oregon, USA in 1978

1991 Air Berlin GmbH & Co. Luftverkehrs KG was founded with Joachim Hunold as sole managing director

airberlin has successfully developed into a full service network carrier


Charter-flights from

Germany

| 1992 – 1997 | 1998 – 2005 | 2006 – 2010 | since 2011

Chartercarrier Mallorca/Euro-Shuttle Scheduled services

Alliances & partnerships

Start of Mallorca and

City-Shuttle

Codeshare with many

airlines worldwide

Strategic partnership

with Etihad Airways

since 2012

Since 3 March 2012

airberlin is a member

of the oneworld®

alliance PAX [m.]

Foundation Business focus: Charter

Organic growth Scheduled traffic specializing on holiday destinations

2006 going public Mergers & acquisitions

International positioning Alliances & codeshares

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Fort Myers

Berlin Dusseldorf

Abu Dhabi

Bangkok

Phuket

Johannesburg

Sydney

New York

Miami

Munich Frankfurt Beijing

*Codeshare scope as of Dec 2012

Codesharing and interlining with Etihad multiplies the number of

destinations and flights on offer

5 AB company presentation l Feb 2013

Destinations operated by Etihad

Destinations operated by airberlin

Joint strategic network approach

Portfolio of almost 90 routes*

56 AB/HG routes carry the EY code

31 EY routes carry the AB code

By combining both airlines’ flight networks and the frequent flyer

programs, the number of available flights for both airlines

increased to include 239 destinations in 77 countries

A whole new world of choice

Gateway to Middle East, Asia, Australia & Africa

Hub to Germany & Europe

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Source: oneworld®

airberlin’s membership in the global airline alliance, oneworld, presents further

opportunities for growth by providing airberlin with access to new destinations and

additional passengers

airberlin is a full member of the oneworld alliance since 20 March 2012


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2012 2011 2013 2014

Shape & Size efficiency program already contributed EUR 250 million to income in 2012

Continuing worsening economic environment as well as other external factors such as aviation tax, fuel

price, BER opening delays and changing consumer behaviour

Positive effects from Shape & Size will be insufficient to achieve profitability

Turnaround program Turbine launched to counteract those effects and achieve sustainable profitability

Involves a wide range of initiatives aimed at structural changes to refocus the business and operating model

with a key focus on cost efficiency

– Turbine challenges status quo business assumptions with the goal of adapting the business model to

“lean and smart” principles

Besides Shape & Size, the management developed an additional,

comprehensive strategic plan in order to achieve its goals in 2013


"Shape & Size" – Internal continuous improvement; well embedded in the organization 1

"Turbine"

Structural changes to refocus

business and operating model

2

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Turbine involves a wide range of initiatives to achieve a sustainable

profitable business model


Process & levers TURBINE

Turbine`s major objective is to reduce costs

and apply efficient operational principles

while maintaining core brand attributes

Structural change to regain competitiveness

Challenge status quo business assumptions

and adapt business model to “lean and

smart” principles

Significantly lift operating performance

(RASK / CASK)

Develop master turnaround plan by the end

of 2012

Building upon airberlin's core brand

attributes (value for money, innovativeness,

service with heart)

“Turbine” sharpens our customer offering,

especially for high-value customers

Implement changes throughout 2013

The program is addressing all elements of

operations, e.g.:

Where airberlin flies

Number and types of aircrafts in the fleet

How airberlin routes aircrafts and crews around its network

Ground processes supporting flights

Organizational setup and responsibilities

IT and systems supporting the head office

Commercial steering model (scheduled / tour operator)

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B.


Financial performance 2012

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Financial Performance – FY 2012

10

EBITDAR EBIT Net result Revenue

+128%

+73%

+2%

6.8

-420.4

70.2

-247.0

736.4 425.9

4,311.7 4,227.3

Despite a reduction of capacity, an increase in revenue is achieved from a slightly higher seat load factor and an increase in yield

Revenue growth, volume related cost reductions and "topbonus" transaction helped to improve EBITDAR significantly

Improvement in EBIT is following EBITDAR development

Followed by a better

financial result, the

company returned to net

profit and improved by

more than EUR 270 m

AB company presentation l Feb 2013

2012 2011

[EUR m]

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Operational development 2012 vs. 2011

Key performance indicators – FY 2012

11

Yield [EUR]

Seat load factor [%]

ASK [bn]

Capacity [m]

Guests [m]

Number of flights [#]

-5.5%

Guests [m]

33.35 35.30

-7.4%

Capacity [m]

41.79 45.14

2012 2011

78.2 79.8

Guests/capacity [%]

+1.6%p.

111.4 120.1

Yield [EUR]

+7.7%

270,498 250,406

Flights

-7.4%

62.16 60.40

ASK

-2.8%

Due to capacity

reductions,

number of guests

declined

Cancellation of

unprofitable

routes, hence

number of

offered seats

reduced

Network

adjustments result

in fewer number

of total flights

based on IFRS flight revenue

including a/p tax revenue

Seat load factor

improves in line

with capacity

adjustments

Due to cancellation

of unprofitable

routes and

measures to

increase yield,

topline quality

improved

Due to route

adjustments

available seat

kilometer declined

by -2.8%


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[EUR m]

Strategic and efficiency initiatives led to additional revenues and

positive earnings contribution in 2012


airberlin has achieved significant revenue and earning contributions from its various strategic initiatives

and its efficiency program in 2012

Revenue effect Earnings effect

250

184

50

Sale of majority

stake in topbonus

Shape & Size Additional revenue

from Etihad Airways

partnership

Earnings effect

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The partnership with Etihad Airways is developing positively

Etihad Airways is codeshare partner No.1 for

airberlin

Portfolio of almost 90 codeshare routes

More than US$130 million revenues in total to EY

& AB

Latest amendment: Codeshare to China & Japan

Due to hub development, codeshare

opportunities will further grow

airberlin’s German hubs connect Abu Dhabi to

over 50 destinations

– Berlin connecting to 40 destinations

– Dusseldorf connecting to 30 destination

Strategic partnership with Etihad Airways delivered EUR 50 million in

additional revenues in 2012


Codeshare development

Harmonization of product standards and the

planned cooperation with regards to the Boeing

787

Boeing Dreamliner programs are affecting firm

orders of a total of 56 aircraft

airberlin and Etihad Airways launch a major

partnership campaign in June

Premium lounges around the world with access

to a growing number of Six Senses spas

New Business Class cabin offers fully automated

seats with an on-demand video system

Private chauffeur service for business class

travellers

Exclusive and discrete door-to-door experience

Further joint initiatives

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Earnings of EUR 184.4 million were realized from the sale of a majority

interest in the frequent flyer program topbonus in 2012


Separation of frequent flyer program topbonus into an

independent organisation and legal entity

Etihad Airways has taken a 70% holding in this new

scheme and airberlin holds the remaining 30%

Transaction is financed through EUR 50 million equity

and EUR 150 million debt financing

Enabling transaction for topbonus to develop its full

potential

Long-term agreements between topbonus and

airberlin for commercial and operational aspects

Two leading airlines

Two leading FFPs

S

T

R

A

T

E

G

I

C

P

A

R

T

N

E

R

S

H

I

P

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[EUR m]

The efficiency program Shape & Size has contributed significantly to the positive

developments in fiscal year 2012

This positive contribution has helped to considerably offset an increase in fuel prices of EUR

80 million

Shape & Size delivered EUR 250m bottom line-effects in 2012


2012

>250

Q4

>80

Q3

>70

Q2

>50

Q1

>50

Implementation

Realization

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Balance sheet structure

16

95%

5%

11%

89% 94%

6%

15%

85%

2,126

Net debt: 813

B/S as of Dec 31, 2011

Fixed & current assets

Liquid assets

Equity

Debt

Net debt: 770

B/S as of Dec 31, 2012

Equity

Debt

2,218

Fixed & current assets

Liquid assets


airberlin has increased its cash on balance sheet position from EUR 239.6 million to EUR 327.9 million in

2012 and reduced its net debt from EUR 813.0 million to EUR 770.2 million in 2012

[EUR m]

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C.


Appendix

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Summary of financials


(1) Restated due to retroactive adjustemetns of deferred tax assets. Previously reported numbers 2011: Net result EUR -271.8m; Earnings per share EUR -3.12; Total assets EUR 2,263.9m;

Total equity EUR 253.7m.

(2) Based on an annual average of 114,552,461 shares outstanding.

Profit & loss 2012 2011 % change

Revenue 4,311.7 4,227.3 2.0%

Operating expenses -4,505.7 -4,484.5 -0.5%

Sale of „topbonus“ 184.4 0 NM

EBITDAR 736.4 425.9 72.9%

EBITDA 144.3 -161.6 189.3%

Operating result (EBIT) 70.2 -247.0 128.4%

Financial result -73.6 -111.9 34.2%

Pre-tax earnings -3.2 -358.8 99.1%

Net result 6.8 -420.4(1) 101.6%

Earnings per share [in EUR](2) 0.06 -4.94(1) 101.2%

Balance sheet 2012 2011 % change

Total assets 2,217.6 2,125.6(1) 4.3%

Total equity 130.2 105.2(1) 23.8%

Cash position 327.9 239.6 36.9%

Net debt 770.2 813.0 -5.3%

[EUR m]

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