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our journey

Annual Report 2011

Etihad Airways Annual Report 2011 3

Travelling well, they say, is more important than arriving. At Etihad Airways, our journey defines us.


HH Sheikh Khalifa bin Zayed Al NahyanPresident of the UAE and the Ruler of Abu Dhabi

HH General Sheikh Mohamed bin Zayed Al NahyanCrown Prince of Abu Dhabi and Deputy Supreme

Commander of the Armed Forces of the UAE

Board of Directors HH Sheikh Hamed bin Zayed Al Nahyan (Chairman)

HH Sheikh Khaled bin Zayed Al Nahyan (Vice Chairman)

HE Mohammed Mubarak Fadel Al Mazrouei

HE Ahmed Ali Al Sayegh

HE Mubarak Hamad Al Muhairi

HE Hamad Abdullah Al Shamsi

HE Khalifa Sultan Al Suwaidi

Etihad Airways


CEO REPORT

2011 was the most momentous year in the short history of Etihad Airways.

Against a backdrop of the global financial crisis, regional instability, continued high oil prices and natural disasters, our milestone achievement of profitability ranks as one of the best performances of any airline in the world.

Our target in 2011 was to break even. Thanks to the dedication and commitment of the entire Etihad Airways family, we surpassed that goal.

We delivered earnings before interest and tax (EBIT) of US$137 million, on revenues up 36 per cent to US$4.1 billion. We carried 8.3 million passengers, up 17 per cent on 2010, with an average seat factor of 75.8 per cent, nearly two percentage points higher than the previous year. All parts of the business contributed to our success. Cargo revenues were up 25 per cent to US$651 million on tonnage up nearly 18 per cent.

Safety remained our highest priority, and our focus on providing the best customer service continued – for example, leading the way with innovative developments such as our First Class Chefs.

During the year we formed a new Guest Experience department to focus on the entire journey of our customers

President and Chief Executive Officer’s report

like never before. We will continue to innovate in 2012 through investment in our product, on the ground and in the air.

The new benchmarks we have set in modern air travel have not gone unnoticed. We were proud to be awarded the title of World’s Leading Airline for the third year in succession, and we were also awarded Best First Class and Best First Class Catering by Skytrax.

We launched five new passenger destinations in 2011 – the Maldives, the Seychelles, Chengdu, Bangalore and Düsseldorf – while also investing in our 11 cargo-only cities. Already in 2012, we have launched flights to Tripoli, Shanghai and Nairobi, with Lagos and Basra to follow, and new services to Washington DC announced.

In 2011, we increased the frequency of more than 13 routes and we will continue this approach, with daily frequencies our minimum target and double daily or more where demand allows. During 2011, we introduced seven new aircraft, boosting our fleet to 64, and in 2012 we expect to add another seven aircraft.

We published the first-ever Etihad Airways Corporate Social Responsibility Report in 2011, detailing our policies and activities to date in relation to our environmental,

community and philanthropic activities. This will become an annual report, charting our progress towards delivering best-in-class performance in this area.

The 2011 results delivered the mandate set by our shareholder, the Government of Abu Dhabi, to be safe, profitable and create the best airline in the world, while fulfilling our role as a key enabler in the transformation of Abu Dhabi into a world-class trade and tourism centre.

While impressive, these results are now consigned to the pages of history. Today’s achievements are no guarantee of future success and our focus is now on reaching greater heights.

Sustained profitability is our new challenge and one that requires a new mindset. In 2012 we have once again set new targets for strong growth, with a passenger traffic target of 10 million and a corresponding increase in profits.

We know it will not be easy – aviation is not an easy industry. In 2011, we contended with the terrible earthquake and tsunami in Japan, global economic uncertainty, regional instability in the Middle East and high oil prices, averaging US$110.83 per barrel over the course of the year – all of which were outside our control. As always, we will expect the unexpected, and in 2012 be ready to

react to the unforeseen events that will undoubtedly arise.

While many factors will remain outside our direct control, there is much we can influence and a key area in 2012 will be our controllable costs. Our record in this area to date is notable. Costs per available seat kilometre, excluding fuel, have fallen by 16 per cent over the last two years, representing annual savings of more than US$187 million. Ongoing cost control will continue to be a key feature of how we do business and more efficiencies have been identified for 2012 and beyond.

Alongside this, much work will take place to develop and strengthen our strategic partnerships and investments to deliver increasing returns. Our strategic partnership with Virgin Australia – which took root in 2011 and is proving very successful – and partnership and investments with airberlin and Air Seychelles, will play a very important part in sustaining profitability.

Through airberlin, Germany’s second largest airline and the sixth largest in Europe, we have instant access to the largest European market of 80 million people in the strongest economy in Europe. This adds 157 destinations and gives us access to 35 million new passengers. This deal will be our most important catalyst for

growth in 2012 and will have a major impact on revenues, with an expected contribution of some US$50 million.

These partnerships are game-changing moves. In 2012, partnerships and alliances are expected to produce just under US$500 million in annual revenues. This is a massive contribution to our business, which is why we will continue to expand and develop such partnerships, strengthening our relationship with our 35 codeshare partners and giving sensible thought to new opportunities that arise and are right for the business to extend our competitive offering for the benefit of our customers.

Internally, we will continue to re-engineer our business, such as through our deal with Sabre Airline Solutions, the aviation computer technology provider, to introduce revolutionary change through cutting edge, integrated software systems across the company.

Etihad Airways staff grew by 15 per cent in 2011, to more than 9,000 people from 128 different nationalities. We continue to focus on the development of an Emirati workforce, which now represents 18 per cent of Head Office staff, in addition to more than 1,000 participating in cadet pilot, engineer, contact centre agent and graduate manager training programs.

Given the challenges faced by the industry, our combination of revenue growth and entry into profitability must be one of the best results of any airline in 2011.”President and Chief Executive Officer, James Hogan

As always, continued success will be driven by our people and depend on collective and individual focus, energy, and commitment to our customers and each other. We will also continue to instil the values of respect, consistency and discipline throughout our workforce.

The year ahead will be about navigating the challenges that come our way, while cementing our reputation as a successful global business, one that delivers increasing returns to its shareholder.

Finally, I thank our shareholder, the Government of Abu Dhabi. The Government has set Etihad Airways ambitious targets and we embrace them, knowing that in all we do we can count on the strong support of our Chairman and the Board of Directors in the implementation of our strategy.

James HoganPresident and Chief Executive Officer


Into the black

✓ Safe airline✓ Best-in-class airline✓ Profitable airline

Etihad Airways’ mandate: While we deliver an exceptional full service product, our management culture is that of a low cost airline. We have a forensic focus on cost control in every area of the business, aggressively targeting operational efficiencies.” President and Chief Executive Officer, James Hogan

US$4.1 billion

TOTAL REVENUE

36%

US$29.6 billion

PASSENGER REVENUE

US$651 million

CARGO REVENUE

25.7%

8.3 million

PASSENGER NUMBERS

17%

38.7 billion

REVENUE PASSENGER KILOMETRES

15.8%

51 billion

AVAILABLE SEATKILOMETRES

13%

75.8 per cent

SEAT FACTOR

1.8%

64 aircraft

FLEET SIZE

12.3%

9,038

NUMBER OF EMPLOYEES

15.1%

• Full year EBIT of US$137 million• EBITDAR of US$648 million • Net profit of US$14 million

10 Etihad Airways Annual Report 2011

23.9%


Report on consolidated financial statementsWe have audited the accompanying financial statements of Etihad Airways PJSC (“Etihad” or “the company”), and its subsidiaries (collectively referred to as “the Group”), which comprise the consolidated statement of financial position as at 31 December 2011, and the consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, and notes, comprising a summary of significant accounting policies and other explanatory information.

Management’s responsibility for the consolidated financial statementsManagement is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with International Financial Reporting Standards, the relevant Articles of Association of the Company and the applicable provisions of UAE Federal Law No. (8) of 1984 (as amended), and for such internal control as management determines necessary to ensure the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s responsibilityOur responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable

assurance whether the consolidated financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected depend on our judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation and fair presentation of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements.

We believe that the audit we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at 31 December 2011, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting

KPMG Lower Gulf LimitedAbu Dhabi BranchPO Box 7613Abu DhabiUnited Arab Emirates

Independent auditor’s report

2011 was the year Etihad Airways became profitable.

The result is testament to the efficacy of financial strategies put in place as long ago as 2006 by the management team.

It also follows the introduction in 2010 of an enriched business model designed to build on the organic depth and scale achieved over the airline’s first seven years of rapid growth.

2011 saw significant progress in each of the four areas of focus – passenger air transport, distribution, air cargo operations and Abu Dhabi hub operations.

In 2011 Cargo enjoyed spectacular growth. A record 310,000 tonnes was carried, 46,875 tonnes or almost 18 per cent more than in 2010. Strongest growth was seen out of Europe as exports from markets such as Germany and Italy held firm during a challenging back half of the year.

Fifteen per cent was contributed by airline alliances. For example, 2011 marked the first full year of Etihad Airways’ strategic partnership with Virgin Australia. The revenue contributed by this alliance was 700 per cent above what had been achieved with Etihad Airways’ previous Australian airline partner.

The 29.21 per cent equity investment in airberlin is expected to generate extra revenue for Etihad Airways of up to US$50 million in the first year alone, while the strategic long-term investment in Air Seychelles – combined with a commercial agreement and five-year management contract – will underpin that carrier’s return to profitability.

Cost reduction was a key factor in the airline’s financial performance. Costs per available seat kilometre (CASK),

Standards and comply, where appropriate, with the Articles of Association of the Company and the applicable provisions of UAE Federal Law No. (8) of 1984 (as amended).

Report on other requirementsAs required by the Company’s Articles of Association, we further confirm that we have obtained all the information and explanations necessary for our audit, that proper financial records have been kept by the Company, and that physical counts of inventories were carried out by management in accordance with established principles. We are not aware of any violation of the Company’s Articles of Association having occurred during the year ended 31 December 2011, which may have had a material adverse effect on the business of the Company or on its financial position.

Vijendra Nath Malhotra31 January 2012KPMGRegistration No. 48

excluding fuel, were cut by 4.6 per cent on 2010 figures, and by 16.6 per cent since 2009, representing an annual saving of US$187 million.

Etihad Airways issued three major Requests for Proposal (RFPs) in 2011 to secure financing for two aircraft and one spare engine. The RFPs received significant interest and were oversubscribed by up to five times the funding requirement. Etihad Airways raised US$767 million in aircraft delivery financing and US$316 million in spare engines sale and leaseback financing, amounting to a total of US$1,083 million raised in 2011. Of this, approximately US$728 million was raised as export credit financing for the Boeing B777 and Airbus A330 passenger and freighter deliveries, and US$39 million was raised in the commercial market for an Airbus A320 delivery. The spare engine financing was raised from two leasing companies in the commercial market.

Three new lending and leasing partners were introduced in 2011– TD Securities, ELFC, and SANAD. The cost of funding from external markets remained

very competitive in 2011, with all transactions resulting in an all-in cost of funding below three per cent.

Etihad Airways’ industry-leading fuel hedging program saw the airline purchase jet fuel at an average cost of US$100.96 a barrel in 2011 against a market average price of US$127.70 per barrel.

The airline’s rolling three-year program involving active hedges with 24 international financial institutions builds certainty into the price of fuel, which is the airline’s largest and most volatile expense.

In 2012, Etihad Airways is again aiming for strong growth, with a passenger traffic target of 10 million and a corresponding increase in profits.

The airline will continue to invest in network, aircraft and infrastructure in 2012, expanding in Asia and Africa, adding seven aircraft to the fleet and looking for opportunities to make profitable alliances in 2012.

Into the black

Focus areas Actions implemented

Passenger air transport • Equity acquisitions in Air Berlin (29%) and Air Seychelles (40%) • 35 codeshare partnerships (2006:two)

Distribution • Joint venture with BCD to create Hala Travel Management

Air cargo operations • Joint venture with Linfox/Armaguard for carriage of precious cargo and cash management• Management of cargo handling and warehousing at Abu Dhabi hub

Abu Dhabi hub operations • Management of check in and ramp operations for Etihad Airways and other airlines• Management of ADIFC (catering company)



airberlin: an ideal partnership


Etihad Airways’ move on December 19 to become airberlin’s single largest shareholder was a game-changing move that opened access to a new market of 35 million passengers.

Etihad Airways had already taken a 2.99 per cent stake in airberlin – Europe’s sixth largest airline and Germany’s second – and by increasing its stake to 29.2 per cent, signalled the start of a strategic long-term partnership linking airberlin’s European hubs with Etihad Airways’ home base in Abu Dhabi.

The year-one revenue prediction arising from the partnership is in the order of US$50 million for each airline, with revenues expected to grow considerably as the partnership matures. Unlocking efficiencies is also a key focus for the two airlines.

The airberlin deal was Etihad Airways’ first equity partnership in a well-developed and highly successful partnership strategy built over the past six years. This strategy has enabled Etihad Airways to stretch its network in a way that would not have been viable for such a young airline, despite its own rapid organic growth.

Under the terms of the agreement, Etihad Airways will provide five-year financing facilities of up to US$255 million to support airberlin’s fleet development and future network growth.

Under the partnership, which received approval from German and Austrian regulatory authorities on January 26, 2012:

» airberlin commenced operating four A330-200 flights a week between Berlin and Abu Dhabi on January 15, 2012, and moved to a daily service on March 25, 2012 » European travellers have access to 29

flights a week to and through Abu Dhabi from four German hubs – Berlin, Munich, Frankfurt and Düsseldorf – with a plan to increase to 42 flights from mid-April 2012 » airberlin launched a new daily route between

Abu Dhabi and Phuket on March 25, 2012 » airberlin is initially codesharing on Etihad

Airways flights from Düsseldorf, Frankfurt and Munich to Abu Dhabi and on Etihad Airways flights from Abu Dhabi to Bangkok, Malé (Maldives) and Singapore, with other destinations to come » Etihad Airways is codesharing on airberlin group

flights to Basel, Berlin, Catania, Copenhagen, Hamburg, Hannover, Helsinki, Milan, Rome, Stuttgart, Venice, Vienna and Zurich, with others to come » Etihad Guest and topbonus, the airlines’ frequent

flyer programs, have been integrated, enabling passengers on both airlines to ‘earn and burn’ on each other’s flights and offering reciprocal benefits – including status earning – to top tier members. The year-one revenue prediction arising from the partnership

is in the order of US$50 million for each airline, with revenues expected to grow considerably as the partnership matures.

Etihad Airways acquisition of the 29.2 percent stake in airberlin was a game-changing move that opened

access to a huge new market of 35 million passengers.


Etihad Airways and Abu Dhabi

Aviation is a critical cluster industry within the Abu Dhabi Government’s 2030 Plan on the basis that a successful airline and airport will promote free-market commercial activity in sufficient volume to underpin a diverse economy, while attracting further investment.

According to the latest study, completed in April 2011 by leading UK think tank Oxford Economics, Etihad Airways plays a crucial role in supporting and driving economic growth in the UAE.

The research used the standard methodology for economic impact appraisals, and was based on data from the International Air Transport Association (IATA), the Air Transport Action Group (ATAG), EUROCONTROL, the UK aviation industry and the Civil Aviation Authority of Singapore (CAAS).

Economic contribution is classified into four key areas: direct (within Etihad Airways), indirect (suppliers to Etihad Airways), induced (spending of direct and indirect employees) and catalytic (impacts on other industries).

Direct Economic Contribution: The airline contributed US$1.46 billion or 2.1 per cent of Abu Dhabi’s non-oil GDP (0.8 per cent of total GDP) in 2011.

Indirect Economic Contribution: Etihad Airways made an indirect economic contribution of US$830 million and supported an additional 15,000 jobs in 2011 through fuel purchases, maintenance and repair, airport rental and landing fees, marketing, advertising, IT ventures and communications.

Induced Economic Contribution: An induced GDP contribution of US$760 million and 13,839 additional jobs can be attributed to money spent during 2011 by people working for Etihad Airways and its suppliers.

Catalytic Economic Contribution: Etihad Airways played an important role in improving air links between Abu Dhabi and the rest of the global economy, and the airline’s expanding network was a key factor in encouraging businesses to invest in the Emirate and the UAE. These activities provided a catalytic economic contribution of nearly US$4 billion, representing 5.3 per cent of Abu Dhabi’s non-oil GDP or 2.1 per cent of total GDP, and supported nearly 104,000 jobs.

Etihad Airways was also a key contributor to the development and growth of tourism in the UAE. In 2011 the airline carried 8.3 million passengers through its hub in Abu Dhabi. In 2012 this figure is set to increase to 10 million passengers.

Based on the airline’s current growth projections, Etihad Airways’ total economic contribution to Abu Dhabi’s GDP is on track to increase by 76 per cent to US$10.743 billion by 2015, helping to support 162,000 jobs in the Emirate.

Etihad’s overall contribution to economic activity in Abu Dhabi

2010 20

11

2012 2013

2014 20

15

Direct Indirect Induced Catalytic

Source: Oxford Economics and Etihad Airways

12

10

8

6

4

2

0

US$ billion

Etihad Airways’ total economic contribution to Abu Dhabi’s GDP is on track to increase by 76 per cent to US$10.743 billion by 2015, helping to support 162,000 jobs in the Emirate.

InternationalBusiness

Transport Infrastructure

Tourism Infrastructure

Airport

Etihad Airways

ABU DHABI 2030 PLAN



A year of stellar achievements

PROFIT

Etihad Airways recorded its first ever full year net profit in 2011 of US$14 million, beating its break-even goal. A full year EBIT of US$137 million was recorded on revenues up 36 per cent to US$4.1 billion.

AIRBERLIN

Etihad Airways’ first equity investment was a 29.2 per cent stake in Europe’s sixth largest airline, giving overnight access to 35 million new passengers and expanding the airlines’ combined networks to 239 destinations.

MANCHESTER CITY FOOTBALL CLUB

A 10-year partnership deal was signed with the iconic English football club and includes naming rights for the club’s stadium and campus, as well as an extension of the shirt sponsorship.

NETWORK

Five new routes were launched – Bangalore, the Maldives, the Seychelles, Chengdu and Düsseldorf – and five announced for 2012 – Tripoli, Shanghai, Lagos, Basra and Nairobi.

FLEET

Eleven more B787-9 Dreamliners ordered – the fleet of 41 will make Etihad Airways the largest operator of this aircraft type in the world.

From profitability to a landmark deal with airberlin and a 10-year sponsorship deal with Manchester City Football Club, in 2011 Etihad Airways demonstrated to the world the scale of its ambition.

CARGO

A record 310,000 tonnes cargo were carried, the almost 18 per cent annual increase continuing the spectacular growth of this key revenue generating division.


2,390

1,929

518

322

3.0

2.32009

2010

2,960

2009

2011

Passenger Revenue (US$m)

2010

651

2009

2011

Cargo Revenue (US$m)

2010

4.12011

Total Revenue (US$b)

AWARDS

Etihad Airways was named World’s Leading Airline in the prestigious World Travel Awards for the third year in succession.TECHNOLOGY

A deal worth more than US$1 billion was signed with Sabre Airline Solutions, the aviation computer technology provider, enabling revolutionary change through the introduction of cutting edge, integrated software systems across the company, affecting almost every facet of the business.

IFE & CONNECTIVITY

A 10-year deal, valued at more than US$1 billion, was signed with Panasonic Avionics Corporation to provide in-flight entertainment systems and in-flight connectivity, including broadband Internet and live TV, for the airline’s entire long-haul fleet of wide body aircraft.

ENVIRONMENT

Etihad Airways reduced carbon emissions per passenger kilometre by five per cent compared to 2010 – with an overall improvement of 17 per cent since 2006 – through initiatives such as lighter cargo containers, modification of selected engines and involvement in an industry-wide program of ‘green flights’ identifying key areas for fuel and emissions saving.

SOCIAL MEDIA

Etihad Airways’ Facebook page was launched in the first quarter of 2011 and by year-end had more than 60,000 fans.

EMIRATISATION

The number of UAE nationals in the company jumped to 18 per cent – a 70 per cent increase – in a year that saw the first female Emirati pilot qualify as a First Officer and the first-ever all-female Emirati contact centre open in Al Ain.


FukuokaKumamoto

Kagoshima

Sapporo

OsakaMatsuyama

NiigataSendai

Okinawa

KuchingJohor BahruKuantan

LangkawiPenang

Phuket KrabiKoh Samui

Denpasar Bali

Kota Kinabalu

Phnom PenhHo Chi Minh City

Trat

Luang Prabang HanoiChiang Mai

Hong Kong

YangonSan'a

Praslin

DakarBanjul

Bamako

CotonouAccra

Nouakchott

OujdaNador

Madrid

LisbonFaro

Funchal

Porto Barcelona

TangiersFez

MarrakechErrachidia

OuarzazateAgadir

Minneapolis La Crosse

Columbus BaltimorePhiladelphia

ClevelandPittsburghHarrisburg

Newark

BostonHartford

NY - La Guardia

Rochester

ToledoBuffaloWestchester

Syracuse

Ottawa

Detroit

IndianapolisBloomington Champaign

Washington

Raleigh (Durham)

Des MoinesDubuque

MadisonMilwaukeeWaterloo

Sioux City

Omaha Moline

Saint LouisEvansville

Louisville

LexingtonTulsa

DenverSalt Lake City

NashvilleKnoxville

Charlotte DouglasMemphis

HuntsvilleLittle Rock

NW Arkansas

AtlantaWilmington

San Antonio

Oklahoma

Miami

OrlandoTampaFort Myers

Austin

Dallas

Houston New Orleans

Las Vegas

TucsonEl Paso

San Francisco

San DiegoPhoenixLos Angeles

Seattle

Covington

KievKievPrague

Krasnodar

St. Petersburg

Kazan

Samara

Auckland

Ouagadougou

Vancouver

Dammam

Jeddah

DamascusLarnaca

Riyadh DohaBahrain

Abu Dhabi Muscat

Beirut

KuwaitAmman

BaghdadTehran

Johannesburg

Alexandria

Khartoum

Cairo

CasablancaTripoli

MunichFrankfurt

Düsseldorf

MilanGeneva

London

Athens

Paris

Dublin

Brussels

TorontoChicago

New York

TrivandrumKochi

Kozhikode

Delhi

MumbaiHyderabad

Bengaluru Chennai

Karachi

Kathmandu

Colombo

Dhaka

Chengdu ShanghaiLahoreIslamabad

Peshawar

Astana

Almaty

Nagoya

SeoulTokyo

Beijing

Manila

Jakarta

Bangkok

Kuala Lumpur

Singapore

Brisbane

Melbourne

Sydney

Minsk

Moscow

Erbil

Basrah

Manchester

Istanbul

Malé

Seychelles

Nairobi

Lagos

Malaga

Nottingham

Gothenburg

StockholmHelsinkiOslo

Copenhagen

PragueKosiceStuttgart

BaselZurich

Inverness Aberdeen

EdinburghBelfastLondonderry

Rhodes

ThessalonikiBarcelona

Lyon

Madrid

Bucharest

Rome Tirana

Venice

Sofia

Birmingham London StanstedAmsterdam Berlin

HanoverHamburg

Warsaw

Budapest

Belgrade

SouthamptonExeter

Jersey

MaltaCatania

Isle of MannLeeds

MarseilleToulouse

Vienna

Innsbruck GrazSalzburg

Palma de Mallorca

MunichFrankfurt

Düsseldorf

MilanGeneva

London

Athens

Paris

Dublin

Brussels

Manchester

Istanbul

Europe Network

ChristchurchQueenstown

Dunedin

Auckland

RotoruaHamilton

Wellington

Hobart

Launceston

AdelaideCanberra

Albury

Gold Coast

Coffs HarbourPort Macquarie

Newcastle

Ballina

Ayers Rock (Uluru)

Darwin

Broome

ProserpineKarrathaPort Hedland

Newman

Perth

Cairns

TownsvilleHamilton IslandMackay

RockhamptonGladstone

Hervey BaySunshine CoastBrisbane

Melbourne

Sydney

Australasia Network

Etihad Destinations

Codeshare Partner Destinations

Etihad Future Destinations

Route map

Etihad Airways Annual Report 2011 23 22 Etihad Airways Annual Report 2011

The story so far

2008 2009 2010 2011

Passengers (million) 6 6.3 7.1 8.3

Fleet by year (passenger & cargo) 42 53 57 64

Total destinations including Abu Dhabi 59 69 79 81

Load factor 75% 74% 74% 75.8%

On time performance 79% 87% 86% 82.6%

Etihad Guest members 500,000 750,000 1,000,000 1,300,000

Etihad Guest accrual partners 30 43 65 67

Etihad Guest redemption partners 69 107 215 273

Codeshare partners 10 19 28 35

Employees 7,058 7,828 7,855 9,038

Revenues (billion)AED 9.1 AED 8.4 AED 10.9 AED 15

(US$ 2.5) (US$ 2.5) (US$ 2.95) (US$ 4.1)

Fuel hedged 76% 66% 82% 80%

We have delivered on our mandate and the business plan we agreed with our shareholder. We have a proven track record, and today, Etihad Airways enjoys the confidence of the banking and financial sector globally and has a high measure of credibility in the business community.”James Rigney, Chief Financial Officer


Many congratulations to Etihad Airways on this year’s results. It is wonderful to have been part of the Etihad Airways story, from inception in 2003 through to world stage as a premier carrier. We look forward to your future success and wish you great fortune in 2012 and beyond.”Richard S Oliver, Managing Director, Head of Global Banking, Abu Dhabi HSBC Bank

Passenger fleet

57Cargo fleet

7Revenue passenger

kilometres

38.7 billion

Staff nationalities

128Top 5 staff nationalities

India (962)UAE (819)Philippines (710)UK (624)Australia (237)

Top 10 routes by passenger volume

Bangkok (500,589)London (478,821)Jeddah (289,439)Sydney (269,185)Frankfurt (237,451)Paris (228,425)Manchester (222,465)Doha (215,137) Dublin (214,733)

5 new destinations

BangaloreMaldivesSeychellesChengduDüsseldorf

Seat factor

75.8%Number of Etihad

Guest accrual partners

67

Guests carried

8.3 millionAvailable seat

kilometres

51 billion

New aircraft

7Annual passenger

revenue

$2.96bn

Total annual cargo carried

310,000 tonnes

Total codeshare agreements

35

Coaches a day from Dubai to Abu Dhabi

22

Etihad Airways’ stake in airberlin

29.2%Average cargo

carried in a month25,000 tonnes

Making the numbers work


8x B777-300ER

11x A340-500/600

22x A330-200/300

16x A319/320

1x B777-200F

2x MD11F

2x A330-200F

2x A300-600F

Current fleet at 31 December 2011 Aircraft on order at 31 December 2011*

* Flexibility to increase deliveries with 85 options and purchase rights.

10x A380

12x B777

19x A350

41x B787

20x A320

Aircraft the right mix



During 2011, Etihad Airways took delivery of seven new aircraft: » Three Airbus A330-300 in a three-class layout » Two Boeing B777-300ER in a two-class layout » One Airbus A320-200 in a two-class layout » The first Boeing B777-200F for the cargo division

This brought the fleet to a total of 64 aircraft as at December 31, 2011.

Seven new aircraft are due for delivery in 2012, with a further 95 on firm order to meet the airline’s needs through to 2020. Out of the total firm order of 100, five have already entered service.

Etihad Airways continually evaluates opportunities to optimise aircraft deliveries to meet forecast passenger demand and network requirements.

During 2011, agreements were put in place with aircraft manufacturers to protect the growth of the airline over the short- and long-term. These included:

» Altering delivery profiles to add three Airbus A320 aircraft in 2012 by advancing two aircraft from 2014 and taking an additional leased aircraft

» Increasing the Boeing B777-300ER order by three aircraft to be delivered in 2013

» Adding further Boeing B787-9 Dreamliner capacity, bringing to 41 the total number of this aircraft type to be delivered between 2014 and 2019, which will result in Etihad Airways being the single largest operator of this model in the world

» Tripling the order for Boeing B777-200F aircraft to join the fleet by the second quarter of 2013

Agreements with the major aircraft manufacturers were restructured to retain flexibility for future capacity growth and coverage for any further delays in the new aircraft programs.

In 2011, Etihad Airways concluded an extensive two-year reconfiguration program in which the majority of the existing fleet was upgraded to Etihad Airways’ exacting standard of onboard product while optimising seat count to match demand on the routes served by each aircraft type.

The following programs were completed during the year:

» Roll out of the new Diamond First Class cabin, incorporating suites and a large changing room on nine Airbus A340 aircraft

» Upgrade of the Pearl Business Class cabin on nine narrow-body aircraft, including the installation of new seats

» Reconfiguration of eight Airbus A330-200 aircraft from three- to two-class, with consistent product and seat count

» Reconfiguration of three Airbus A330-300 aircraft, resulting in an additional 28 seats by adjusting cabin configurations to match demand.

Work commenced for the entry into service of the Airbus A380 and Boeing B787, which will be delivered in 2014.

In 2011, progress included: » defining the onboard product and seat count » detailing specifications for the aircraft » managing onboard weight » infrastructure technology readiness

Etihad continually evaluates opportunities to optimise aircraft deliveries to meet forecast passenger demand and network requirements.

5720

10

52

64

2009

2011

Total Fleet

57,5

3420

10

49,0

64 62,7

35

2009

2011

Total Aircraft Departures

Etihad Airways takes weight management on its aircraft seriously, with the aim of reducing fuel costs and aircraft emissions. A project group was formed in 2011, tasked with identifying and implementing initiatives to reduce weight and lower fuel burn and the impact on the environment. Savings have already been made through the use of lighter weight composite materials in cargo containers, catering equipment and magazines.

Weight management

initiatives

Fleet the right size



Network connecting the world

Network Management generates optimal commercial results by designing, implementing and managing a customer-driven network and schedule.

When planning the development of the Etihad Airways network, the airline takes into account a range of indicators such as demand, potential revenue and profitability, and analyses current and new markets for the best capacity fit (aircraft size and cabin configuration) to ensure each market will contribute to airline profitability.

Schedule planning is based on optimal connectivity across the network and customer convenience, with the important goal of maximising use of the airline’s major assets – its aircraft – while working within operational, environmental, political and infrastructure constraints.

The airline’s 10-year network plan was refreshed in 2011, detailing Etihad Airways’ growth through to 2020 to include 131 passenger destinations with a fleet of over 150 aircraft.

Six new passenger aircraft in 2011 allowed Etihad Airways to add five new destinations to the network: Bangalore, Maldives, Seychelles, Chengdu and Düsseldorf. An additional 36 frequencies to 12 existing destinations were also added. As part of its European expansion at the beginning of summer 2011, 17 additional weekly frequencies were added across five existing destinations – Paris, Geneva, Milan, Brussels and Manchester.

The combination of increased routes and frequencies generated a 30 per cent year-on-year increase in sub-four-hour connectivity over the Abu Dhabi hub.

Significant expansion is planned into the emerging markets of China, Africa and the Middle East with the following new destinations added to the network:

» Tripoli (three per week – from January 17, 2012)

» Nairobi (daily – from April 1, 2012)

» Shanghai (daily – from April 15, 2012)

» Basra (four flights per week – from April 15, 2012)

» Lagos (six per week – from July 1, 2012)

Etihad Airways also planned additional frequencies to a range of other destinations to be introduced in 2012, enabling it to increase the depth and breadth of the network.

Other changes planned for 2012 include:

» upgrading services to Jakarta (March) and Kuala Lumpur (April) to two-class Boeing B777-300ER aircraft;

» deploying the first three-class B777-300ER on the London-Abu Dhabi route (July 2012); and

» adding a third daily Bangkok service (April 15, 2012).

74.0

%20

10

73.6

%

75.8

%

2009

2011

Seat Factor(%)

8,29

7

7,10

020

10

6,27

620

09

2011

Passenger Numbers (’000)

At December 31, 2011 » 81 destinations in 51 countries. »Available Seat Kilometres (ASKs) on the network grew to

51 billion, up 13 per cent on the previous year. » Revenue Passenger Kilometres (RPKs) grew to 38.7 billion,

up 16 per cent on the previous year.


a


In May 2011, the Product and Service department was repositioned and renamed Guest Experience. More than just a departmental name change, the move is a strategic business change, reflecting Etihad Airways’ total commitment to caring for its customers at every stage of their journey, and refocusing the airline’s resources on the delivery of service at the very highest standard.

Etihad Airways’ world-first Guest Response initiative was launched in December 2011, based in the airline’s round-the-clock Network Operations Centre. Guest Response provides assistance and service recovery to First and Business Class passengers and premium-tier Etihad Guest members who are in ‘live journey’, with real-time links to the Etihad Airways global airport network that are particularly beneficial during operational disruptions. The Guest Response unit also provides ‘speed-dial’ support inflight to the airline’s cabin crew, enabling on-the-spot service recovery.

2011 saw considerable consolidation after several changes to the Diamond First and Pearl Business Class cabins in 2010, including a program to standardise inflight processes, ensuring consistency of service across all fleet and seat types.

Other key initiatives launched during the year included: » A new premium cabin service on ultra short-haul

flights in response to guest feedback to ensure faster delivery of drinks and appetisers » Fortnightly menu changes to ensure frequent guests

experience variety » New amenity kits in Diamond First Class » ‘Immaculate Etihad’ – a program to ensure a new

level of cleanliness in all cabins » The innovative First Class Chef concept and

introduction of the ‘Mezoon Grille’ cuisine, which continues to be rolled out across the First Class operation » A new recruitment and training program to

strengthen the Guest Affairs team and offer world- leading customer response times

Inflight entertainment is a crucial differentiator between airlines, and Etihad Airways is committed to providing the best, both in terms of content and system performance and reliability. The new Panasonic eX2 IFE system is incredibly popular with customers and so far features on 16 aircraft, with roll-out on a further 100 planned.

Inflight mobile phone and Internet connectivity services were launched on two Airbus A330-300 and one A320 aircraft towards the end of 2011 and further deployment will continue to be a key area of focus in 2012 with 12 aircraft equipped by year end.

Etihad Airways invested in a rigorous research program that was launched in September 2011. The new research approach comprises four measures, including the IATA airs@t survey, the Mindset survey, the Etihad Guest Experience survey and a new Etihad Airways Staff Travel survey.

On the ground, destinations offering Etihad Chauffeur service to premium passengers increased to 27 and the frequency of the free Etihad Express luxury coach service between Abu Dhabi and Dubai increased to 22 trips per day.

The airline’s efforts to improve and refine the guest experience will deepen and strengthen in 2012 as Etihad Airways reinforces its drive to be a world leader in this field with positive and exciting action.


1 October saw the introduction of Inflight Chefs in Diamond First Class and the launch of the signature ‘Mezoon Grille’ cuisine.

2 16 aircraft were equipped with the latest Panasonic eX2 IFE technology by the end of the year.

1

2

Etihad Guest Experience frequently and regularly assesses the airline’s performance in the eyes of its customers.

Participation in Airs@t – IATA’s independent quarterly benchmarking study of major airlines’ Business and Economy classes – continued in 2011, with positive results for Etihad Airways in both classes. In addition, Etihad Airways launched its own Etihad Guest Experience Survey. The first quarterly results, delivered in November 2011, showed strong performance in all cabins while indicating areas for development in 2012.

Guest Experience leading the world

Etihad Cargo achieved a strong performance in 2011, with revenues exceeding budget by more than US$33 million and year-on-year revenue growth of over US$133 million. Freight carried grew nearly 18 per cent year-on-year to average more than 26,000 tons per month, with a record tonnage month in December, which exceeded 29,000 tons.

During the year, the freighter fleet grew from six to seven aircraft with the introduction of Etihad Cargo’s first Boeing B777 freighter. Freighter capacity now accounts for one third of the total Available Tonne Kilometres (ATKs) offered for sale.

The freighter network continued to be optimised and expanded, with the addition of Almaty, Amsterdam, Cairo, Djibouti, Johannesburg, Kabul, Kandahar, Karachi and Lahore. The freighter network grew to 27 stations, 10 of which are freighter-only stations.

A new record in charter revenue was achieved during the year, with revenue in excess of US$50 million, accounting for seven per cent of cargo revenue.

Etihad Cargo expanded its product portfolio with the launch of the FAST-TRACK premium product, offering priority handling and faster connectivity. The product has been well received and is generating more than US$1 million in revenue per month.

In addition to the existing UAE road trucking schedules operated by Al Mazroui International Cargo Company, scheduled trucking was launched from Abu Dhabi to Bahrain, Dammam, Doha, Kuwait and Muscat, using the capabilities and existing schedules of DHL and Dnata-PWC.

The scheduled trucking frequency from Abu Dhabi to Dubai and Sharjah expanded, increasing to 115 weekly departures, to allow a greater focus on targeting business destined throughout the UAE.

In March 2011, Etihad Airways appointed Jettainer as its Unit Load Device (ULD) provider, focusing on cost reduction and reduced fuel burn by deploying lighter weight ULDs.

The business will move forward with implementation of new modules of the Cargo Max Revenue Management system, offering revenue improvement opportunities through enhanced inventory, allotment and bid pricing controls.

A precious cargo shipment facility will be launched in 2012 in collaboration with Linfox Armaguard.

86.3

2010

107.

3

93.0

2009

2011

Cargo Revenueper Freighter(US$m)

263

2010

219

310

2009

2011

Cargo Tonnage(’000)

Etihad Cargo a record performance



It has been an amazing journey for Etihad Airways. We are proud of achieving our goal of profitability in only eight years – and more importantly, to have done so while maintaining our absolute commitment to the highest standards of safety, which will always be our paramount concern.”Richard Hill, Chief Operations Officer

Etihad Airways’ Operations division is responsible for delivering a safe, punctual and efficient customer experience of the highest quality.

In 2011, Etihad Airways operated 56,643 flights, an increase of seven per cent, or 3,553 flights, on the previous year. Despite this increase, only 192 flights were cancelled, down by 31 per cent, or 85 cancellations, on 2010.

It proved to be a challenging year for Etihad Airways in terms of maintaining the high on-time performance of the previous two years. An extraordinarily high number of external weather and political events impacted performance for the first half of the year, while from June, air traffic flow restrictions took their toll. Cumulatively, these external factors drove the airline’s on-time performance down to two per cent below target, at 82.6 per cent.

Overall, Etihad Airways’ technical dispatch reliability was stable, and above industry standard, improving in 2011 to 99.1 per cent – well above target.

Several systems and programs were implemented to automate processes and improve efficiency. Etihad Airways’ non-flight data monitoring platform, for example, allows the operations team to read aircraft system data more quickly and with a higher data consistency than before at a fraction of the cost. Etihad Airways also upgraded its capability to communicate from the ground to the aircraft by implementing new enhanced tools to facilitate greater flexibility and speed of data processing.

A network-wide fuel and combined route optimisation project was completed after a 15-month implementation. This system allows for the real time comparison of fuel

costs versus route costs, and ultimately the selection of the most efficient route, based on multiple input parameters.

The year was marked by a series of firsts, including the successful training and graduation of the first female Emirati First Officer, the first Emirati engineer, and the first female Captain.

A total of 215 pilots, 900 cabin crew and 113 chefs were recruited and trained.

Etihad Airways’ instructor training programs were significantly upgraded during the course of 2011 to enhance standardisation in pilot training and flight safety.

The Technical division oversaw an ongoing program of innovation and product enhancement to ensure Etihad Airways aircraft are maintained to the highest standards.

The Airbus A330-200 aircraft fleet was extensively reconfigured from three to two classes while the retrofit program for the new Diamond First Class suite on the Airbus A340 fleet continued to ensure a consistent product across the airline. In 2011, the first Airbus A330 aircraft in Etihad Airways’ fleet was fitted with onboard connectivity.

Adding to the network of local line maintenance centres at Etihad Airways outstations, a new facility was opened in Manchester, where 12 people are employed to service Etihad Airways aircraft.

The first quarter of 2011 saw the “Arab Spring” civilian uprisings in Tunisia, Egypt and Bahrain, followed quickly by the earthquake and tsunami disaster in Japan. Despite these unprecedented and disruptive events, Etihad Airways’ scheduled operations remained steady and wholly complete even though contingency plans were in

Operations a commitment to technical excellence



Safety was once again the priority and preeminent focus for the Operations division in 2011.The division’s objectives are:

» Zero accidents

» Continuous decrease in the severity of incidents and occurrences

» Continuous improvement in safety culture

In 2011, a 61 per cent reduction in risk for identified hazards across all operational areas was achieved.

The new Environmental Health and Safety Management System, approved by the Abu Dhabi Department of Transport, was implemented in 2011 in addition to Etihad Airways’ own Safety Management System, which is designed to manage safety proactively and promote a positive safety culture.

Etihad Airways’ Safety Week, which took place in May, and a Pilot Safety Seminar in October were both well attended.

The biennial IOSA-renewal audit is scheduled for 2012. The industry’s most challenging operational audit will be conducted by an external international audit team in May. This follows successful IOSA audits in 2006, 2008 and 2010 – all of which were passed with no findings.

place to respond to the unique demands of each event. The crisis in Egypt, in particular, brought about a rapid response from the operations group to repatriate UAE nationals. Over a three-day period Etihad Airways was able to provide assistance to more than 1,000 UAE nationals.

The earthquake and tsunami in Japan saw another unique challenge for the industry and Etihad Airways was one of the few airlines that continued to operate to both Narita and Nagoya throughout the crisis. The welfare of the airline’s Japan-based staff, their families, and the flight deck and cabin crew operating into Japan, became top-priority until the threat diminished, and by late April a state of normalcy had returned.

Good progress was made in fuel and carbon emission savings by refining operating procedures, optimising flight routes and altitudes, and reducing aircraft weight. These, together with improved payloads, resulted in a five per cent improvement in efficiency per RPK from 2010.

Working with a wide range of stakeholders, the airline continually looks at all phases of flight for potential fuel savings. Locally, the introduction of new approach routes (planned for the third quarter of 2012) and landing procedures in Abu Dhabi will allow for the decrease of each flight path by 33 flight kilometres. More widely, demonstration flights across the Indian Ocean indicated substantial emissions savings if the airline were able to make better use of its onboard flight management systems to identify more flexible, fuel efficient routes.

2011 saw the introduction of a formalised biofuel strategy. In addition to its investment with the Masdar Institute-led consortium conducting research into viable, locally produced biomass for alternate fuel, Etihad Airways operated its first demonstration flight using a biofuel blend in January 2012.

Safety Etihad Airways’ top priority


Etihad Guest, Etihad Airways’ loyalty program, enjoyed a stellar year as membership increased by a third for the second year in succession. By the end of 2011, its sixth year of operation, Etihad Guest had more than 1.3 million members.

The number of miles accrued by members rose by 42 per cent and Total Partner Revenue was up by some 207 per cent, largely due to the success of co-branded credit card initiatives with Abu Dhabi Commercial Bank and Abu Dhabi Islamic Bank.

Member redemptions also rose strongly, outperforming 2010 by 68 per cent.

Over the course of the year, 15 accrual partners were added to the Etihad Guest portfolio, giving members the opportunity to earn and burn miles with a total of 75 partners.

New partners include Malaysia Airlines, American Airlines and bmi; blue chip brands such as Avis, Citibank and American Express Membership Reward; and local firms such as Etisalat, Mobily and Atlantis The Palm Hotel.

Innovative member-only promotions such as the raffle draws for Paddock Club passes to the 2011 Formula One Etihad Airways Abu Dhabi Grand Prix and an all expenses paid trip to the Maldives, saw some 34.5 million miles redeemed.

Etihad Guest miles of rewards

In 2011, Etihad Guest announced the launch of a major initiative that allows members to redeem their miles at up to 30 million points of sale across the globe. This new facility, which comes into effect in 2012, will revolutionise the program, effectively giving Guest Miles the same liquidity as major global currencies. The ’virtual credit card’ will cement the program’s status as the most innovative in the industry.



In 2011, Etihad Airways continued the development of its world class global sales and distribution network.

» Distribution was broadened with a concerted strategy to increase global deals, and to strengthen relationships with key travel trade partners at local and global levels, particularly with travel management companies specialising in business travel » Sales teams were strengthened with additional

specialist corporate sales executives and regular advanced sales training programs » Training and development for the sales teams

placed emphasis on new sales technology and a more analytic approach to sales, to leverage substantial investments made in tracking analysis and reporting during the year

As part of the work to strengthen distribution, there was also increased focus on allocating inventory for group travel, supporting efforts of the commercial team to service important tour operator series traffic as well as ad hoc groups.

Etihad Airways also achieved significant growth from direct sales in 2011, using direct channels including Etihad Holidays, destination management company Hala Abu Dhabi, etihad.com, Etihad shops in the UAE and the airline’s global contact centres. Direct sales grew as a proportion of overall sales throughout 2011 in line with strategic objectives.

During 2011, the stature of Hala Abu Dhabi grew within the industry, and over the course of the year, it was the inbound tour operator for internationally prestigious events such as the World Economic Forum and the Arab Air Carriers Organisation (AACO) Annual General Meeting. Etihad Airways continued to invest in its global contact centres to support its expanding network. At the beginning of 2011, Etihad Airways had three contact centres: Abu Dhabi, Al Ain and Mumbai. By the end of the year these three centres employed 450 people, 51 per cent of the people employed in the UAE being Emiratis, predominantly women based in Etihad Airways’ Al Ain centre.

Following the signing of the Memorandum of Understanding (MoU) with Manchester Airport Group and MIDAS (Manchester’s Inward Investment Agency) on March 23, 2011, planning began on Etihad Airways’ European contact centre. The 178-seat contact centre, located in the Voyager Building at Manchester Airport, was officially opened on February 6, 2012. Currently employing 78 people, including a mix of experienced travel professionals, linguists and school leavers, the centre is planned to grow to 160 by July 2012 and will handle calls from over 25 markets in 13 languages.

Globally, the centres received more than 2.7 million calls in 2011, a number which is expected to grow to more than three million in 2012.

etihad.com is an integral sales and marketing channel for the airline, and has grown significantly as a primary direct distribution channel. During 2011, bookings grew by 49 per cent, driven by a 29 per cent increase in visits. Revenue grew by 35 per cent. Additional language capability was added during 2011, making the website available in 10 languages: English, Arabic, French, German, Italian, Chinese, Japanese, Korean, Russian and Thai. Strategic pricing initiatives and the further development of the airline’s inventory systems were the hallmarks of revenue management during 2011.

Etihad Airways migrated to a new Origin and Destination inventory management system in 2011. This system assesses optimum use of the airline’s inventory of seats, based on each passenger’s total journey rather than by sector. Development of a new forecast model based on 2011 data is under way and will be deployed in 2012. This new forecast methodology will take advantage of real time passenger booking data to increase forecast accuracy and further improve revenue generating capabilities.

A major fare class realignment exercise was undertaken in July 2011, with the new inventory control methodology providing an opportunity to create new competitive and revenue generating market fares.

1 Al Ain Contact Centre

2 etihad.com is an integral sales and marketing channel

2

We have achieved global recognition as a leading airline brand that stands for an inspirational customer experience. Our strong brand and exceptional product allow us to accelerate sales across all market segments, as the airline of choice for consumers and trade partners.”Peter Baumgartner, Chief Commercial Officer

Sales a pillar of sustainable profitability

1


The role of information technology (IT) as a key enabler in any business is critical, and Etihad Airways is no exception.

The airline embraces IT, placing great emphasis on the need for sound and robust platforms to underpin the way the airline conducts its business. Equally, ongoing investment in systems and processes to enable a smarter and more efficient company is crucial.

Etihad Airways’ IT infrastructure is a complex environment with more than 3,000 personal computers and 300 servers running 170 applications across a global network.

2011 saw the renewal of the IT foundations that will facilitate Etihad Airways’ ability to remain a dynamic and competitive company over the next decade. This included a restructure in the IT department with a renewed emphasis on effective engagement across the organisation, offering efficient, cost-effective IT support aligned to the commercial objectives of each division within the business.

The restructure made provision for the creation of an Innovation and Technology Exploitation group to identify opportunities for new technologies to improve existing processes, such as the use of tablet devices by cabin crew to enhance customer service and reduce paperwork.

In 2011, Etihad Airways signed a revolutionary 10-year technology deal with Sabre Airline Solutions – the single largest technology-enabled business change that Etihad Airways will undertake in a decade – to utilise cutting edge, integrated software across reservations, inventory, marketing, planning, e-commerce, distribution and departure control operations.

The Sabre-created software will be implemented by February 2013 and will significantly reduce the airline’s technology costs while streamlining processes.

This groundbreaking deal will play a pivotal role in generating efficiencies to deliver the airline’s future revenue growth.

Important systems were upgraded or migrated during 2011. These included:

» the corporate system for managing financial, supply chain and human resources transactions;

» the e-commerce system used to drive web selling, promotions and customer engagement;

» the airline’s Customer Relationship Management system, aimed at delivering more effective service for the airline’s passengers; and

» the Aircraft Movement and Crew Control system, which enables efficient on-the-day management of Etihad Airways’ fleet schedule and crew duties.

In addition, more than 30 new projects were delivered during the year, ranging from complex revenue management systems to simple web forms to improve business processes.

A major program of infrastructure renewal was commenced to ensure that Etihad Airways benefits from scalable and best practice technology to support its operations over the next decade.

In the year ahead, Etihad Airways will continue to focus on ensuring it has the most efficient and effective IT systems to support the business and its people.

Information technology helping drive the efficiencies needed for profitability


Etihad Airways has pursued an effective strategy of forming alliances with carriers around the world to enhance its network and marketing reach.

At December 31, 2011, Etihad Airways had one equity partnership (with airberlin), Europe’s sixth largest carrier providing Etihad Airways with increased access to Germany, Austria and Switzerland and points across Europe and into North America.

The airline’s 35 codeshare deals with key partners around the world have created a comprehensive virtual network giving customers easy access to destinations not directly served by the Etihad Airways fleet. The agreements have also generated considerable revenue for Etihad Airways.

Revenue generated from alliance traffic grew by more than US$418 million in 2011, up 48 per cent on the previous year. Alliance revenue contributed over 15 per cent of the airline’s total 2011 passenger revenue, with around 25 per cent of this coming from premium cabins.

The comprehensive agreements include codeshare flights, reciprocal frequent flyer programs, premium lounge access and other customer benefits, depending on the partner.

The convenience and seamlessness of these arrangements has been critical in generating customer loyalty.

During the year, Etihad Airways announced eight new codeshare partnerships with: airberlin, Air Astana, Air New Zealand, SNCF (French Railways), Czech Airlines, Vietnam Airlines, Tap Portugal, NIKI and Hainan Airlines.

An agreement was also reached with Air Seychelles and this partnership is a strategic move by both carriers to support the Mahé – Abu Dhabi route. However, January 2012 saw this relationship transformed, following the acquisition by Etihad Airways of a 40 per cent stake in the national carrier of the Seychelles. In addition to the capital investment and loan, this long-term strategic agreement makes provision for a five year management contract that will see the implementation of strategic measures to encourage Air Seychelles’ long-term commercial growth and sustainability.

One of the keys to success is providing convenient schedules that get our customers where they want to go. Alliances and partnerships enable us to offer an enhanced network of services, which translates into greater choice for our customers, in turn generating revenue for the airline – and this makes good commercial sense.”Kevin Knight, Chief Strategy and Planning Officer

Partnerships and alliances stretching the network and contributing to revenue

Aer Arann*airberlinAir AstanaAir MaltaAir New ZealandAir Seychelles***AlitaliaAmerican AirlinesANAAsianaBangkok AirwaysbmiBrussels AirlinesCyprus AirwaysCzech AirlinesflybeHainan AirlinesJet Airways

Kuwait AirwaysMalaysia AirlinesMalév**Middle East AirlinesNIKIOlympic AirlinesPhilippine AirlinesRoyal Air MarocSaudi Arabia AirlinesSiberia Airlines (S7)SNCF (French Railways)Sri Lankan AirlinesTAP PortugalTurkish AirlinesUkraine International Virgin AustraliaVietnam AirlinesYemenia

Etihad Airways codeshare partnerships:


* To become Aer Lingus in 2012** Ended operations in 2012*** Commenced January 2012


Etihad Airways is 100 per cent owned by the Government of Abu Dhabi. The airline has the following investments, subsidiaries and joint ventures, all of which are accounted for in Etihad Airways’ consolidated financial statements.

Joint ventures

» ASC (Airline Services Centre) Private Ltd is a wholly owned subsidiary of Etihad Airways. ASC Airlines Service Centre is located in India and provides services as a captive call centre for Etihad Airways.

» Amadeus Gulf LLC is a subsidiary of Etihad Airways, owned jointly by Etihad Airways (51 per cent) and by the Amadeus IT Group S.A. (49 per cent). Amadeus is a leading global distribution system and technology partner for the world’s travel and tourism industries. Amadeus Gulf LLC is present in the United Arab Emirates, the Kingdom of Bahrain and the Sultanate of Oman.

» Aldar Etihad Investment Properties LLC is a joint venture between Abu Dhabi’s largest real-estate developer Aldar Properties and Etihad Airways. The joint venture was created to acquire Abraj Tower (later renamed Etihad Plaza) in Abu Dhabi. Etihad Plaza provides cost effective housing, recreation facilities, utilities and services to more than 1,000 members of Etihad Airways’ staff and the surrounding community.

» Hala Travel Management is a joint venture between Etihad Airways (80 per cent) and BCD Travel (20 per cent) providing various travel management services to the Government of Abu Dhabi and its clients and supporting the growing requirement for a comprehensive service for corporate and government clients, including global airline reservations, hotel accommodation, car rental and insurance. It commenced operations in February 2011.

» Armaguard Valuables Management LLC is a joint venture between Etihad Airways (51 per cent) and the Linfox Group (49 per cent). The company will provide transportation for valuable goods around the globe from the second half of 2012.

Equity investments

» airberlinIn December 2011, Etihad Airways concluded its first major equity investment increasing its stake in airberlin, Europe’s sixth largest airline, to 29.2 per cent.

» Air SeychellesEtihad Airways acquired a 40 per cent shareholding in Air Seychelles in January 2012. The remaining shares in the Seychelles national airline are held by the Government of the Seychelles.

Joint ventures subsidiaries and equity partnerships


In 2011, the primary objective for Marketing was to support and drive revenue to achieve the airline’s commercial break-even objective. Overall, marketing activity delivered a 10:1 return on investment.

Considerable investment was made in digital marketing over the year, as it continued to demonstrate a strong return.

This investment included increased search engine marketing (SEM), ensuring consistent banner activity in key markets, and increasing online affiliate partners. SEM was one of the highest returning activities for the year.

Specific promotional campaigns were developed to support the launches of new routes including the Maldives, Seychelles, Chengdu, Düsseldorf and Shanghai. These campaigns involved introducing the Etihad Airways brand and service into the new market, as well as stimulating interest within the airline’s home and key connecting markets.

Marketing continued to leverage the Etihad Guest database to incentivise members to fly in the premium cabins, in particular through popular Double/Triple miles offers for Pearl Business and Diamond First Class bookings. Direct marketing campaigns were also activated in cooperation with major local and international partners, such as Abu Dhabi Commercial Bank (ADCB), Abu Dhabi Islamic Bank (ADIB), Visa, MasterCard, American Express, Carrefour and Hertz.

Etihad Airways continued to work closely with the Abu Dhabi Tourism and Cultural Authority and international partners such as Tourism Thailand, Tourism New South Wales, Tourism Queensland, Tourism Ireland, and Tourism Manchester. Joint activity with these organisations allowed Etihad Airways to stretch its marketing budget, while developing campaigns to support leisure traffic across the network in key source markets.

Marketing driving revenue

In 2011, Etihad Airways continued to drive the destination marketing program ‘essential abu dhabi’, coordinating activity across over 40 destination partners and managing all related marketing communications. The program’s website – essentialabudhabi.com – had more than 140,000 unique visitors during the year.

Hala Abu Dhabi managed inbound MICE business for major conferences and exhibitions hosted by the Abu Dhabi Tourism and Cultural Authority.

Etihad Airways announced the expansion of its successful partnership with Manchester City Football Club in June 2011. The comprehensive and innovative 10-year partnership involves the extension of the existing shirt sponsorship, as well as naming rights for the stadium and the expansive surrounding grounds, now known as Etihad Stadium and Etihad Campus.

In celebration of this milestone, a special Manchester City-liveried Airbus A330-200 aircraft in the club’s signature sky blue colour entered into service. The aircraft operates on the Abu Dhabi-Manchester route and also serves Milan, Frankfurt, Brussels, Johannesburg, Kuala Lumpur, Jakarta, Singapore, Istanbul and destinations throughout the Middle East and India.

In 2011, Etihad Airways’ major sponsorships – Manchester City Football Club, Etihad Stadium Melbourne, Harlequins Rugby Club, GAA Hurling, and the Formula 1 Etihad Airways Abu Dhabi Grand Prix – helped extend the airline’s brand reach across the world.

Etihad Airways’ multi-tiered agreement in support of Abu Dhabi’s involvement in the 2011/12 Volvo Ocean Yacht Race saw the airline’s livery featured prominently on the hull and sails of Abu Dhabi Ocean Racing’s entry, Azzam, as well as across its Abu Dhabi Ocean Racing team apparel during the global event.

Etihad Airways was also the presenting sponsor for the fortnight-long race stopover in Abu Dhabi and title sponsor of the In-Port Race.

Other major Abu Dhabi sponsorships included the HSBC Abu Dhabi Golf Championships, the Mubadala World Tennis Championships, and the World Professional Jiu-Jitsu Championships 2012.

As part of a strategy to target the Indian market and Indian nationals worldwide, Etihad Airways continued to work with rising Bollywood star Katrina Kaif, who is an Etihad Airways brand ambassador.


Throughout the year, incremental traffic opportunities were generated through targeted tactical campaigns. Regular Breaking Deals offers were made available on the web in major markets. The regular online deals, initially introduced in 2010, are now available in 10 key markets and offer highly-discounted, last-minute offers to encourage repeat visitors to etihad.com.

Major tactical promotional campaigns were developed and executed throughout the year, stimulating demand during specific periods – for example, the ‘Up, Up & Away’ campaign in April and May provided a necessary boost in bookings during the shoulder season. This was followed by a special Ramadan sale targeted at increasing outbound traffic for short holidays, inbound traffic from GCC markets and key traffic over the Abu Dhabi hub.


1 Etihad Airways supported the 2011/12 Volvo Ocean Yacht Race.

2 Etihad Stadium in Melbourne.

3 essential abu dhabi livery.

4 In June 2011, Etihad Airways announced the expansion of its successful partnership with Manchester City Football Club, a comprehensive and

innovative 10-year partnership.

3

4

2

1

Etihad Airways acknowledges its position as an integral part of society, as well as its potential to have both positive and negative impacts on the communities in which it operates.

Aligned with the greater ambitions and vision of the Emirate of Abu Dhabi, the Etihad Airways corporate social responsibility (CSR) and sustainability policy and supporting strategy is designed to:

» ensure the airline’s compliance with all applicable international and local regulations and standards;

» mitigate any potential risks and minimise, wherever possible, negative environmental and social impacts from its operations; and

» enhance the airline’s reputation through the implementation of industry best practice in the fields of sustainability and social responsibility.

Etihad Airways’ strategy is based on the premise that CSR is a collaborative process, and one that will only succeed in partnership with internal and external stakeholders – which is why the airline’s CSR and sustainability program is called Together.

Together is a four-part policy, communications and reporting framework for engagement with a broad range of stakeholders – staff, the local community and economy, and the greater communities across the airline’s global network.

Social responsibility and sustainability creating a community

In these four areas, it is Etihad Airways’ aim to work collaboratively in:

» identifying and developing awareness of issues and challenges;

» focusing action to address these challenges; and

» making a difference, through measurable improvement, year on year.

The company’s second CSR Report, which complements this Annual Report, will provide comprehensive information in each of these four areas mapped against the Global Reporting Initiative Index.



Active recruitment of employees continued throughout the year to support the growth of the airline and its business objectives. Almost 7,700 of the airline’s employees are based in Abu Dhabi, with 1,300 located in 46 other countries. Of the total number of employees, 1,185 are pilots and 3,230 are cabin crew.

Staff costs are second only to fuel costs for the company, so great attention was paid to headcount, with both staff numbers and associated cost targets being met for the year.

Etihad Airways’ growth necessitated the establishment of teams at five new outstations – Seychelles, Maldives, Chengdu, Düsseldorf and Bangalore.

With 52 external senior appointments and more than 100 internal senior promotions in 2011, Etihad Airways is increasingly recognised as an environment for career development and progression.

Etihad Airways’ Emiratisation strategy accelerated in 2011 with the number of UAE nationals employed at year end reaching 819, an increase of 335 – or 70 per cent – on 2010. UAE nationals are the second highest nationality at Etihad Airways and comprise more than 18 per cent of the workforce.

The strategy is supported by local institutions such as the Abu Dhabi Tawteen Council, the Abu Dhabi Education Council and the Institute of Applied Technology.

People and performance on target for growth and profitability

UAE nationals, including those at senior level, join the airline through development programs and as direct entry appointments. Forty-two UAE nationals graduated in September from the airline’s three core training streams as cadet pilots, technical engineers and graduate managers.

In March 2011, the airline opened a unique all-female Emirati Etihad Airways contact centre in Al Ain. This followed the completion of a nine month training and development program by 85 female UAE nationals.

New development programs were introduced to grow a strong pipeline of capability to support Etihad Airways’ airport management and ground services operations.

A number of other Emirati employees pursued opportunities on international assignments and rotations in destinations including the USA, Australia and Malaysia, where they were able to broaden their exposure to the business and gain experience working in the global arena.

At the end of 2010, Etihad Airways employees completed their first full year cycle of the new performance management system ‘iachieve’, with employees receiving the first pay increases based on performance in April 2011.

To address the administrative requirements of a growing workforce and focus on streamlined and efficient processes, Etihad Airways implemented an online self-service function for employees

Etihad Airways employees are drawn from more than 125 nationalities, providing an incredibly diverse and widely experienced workforce.” Ray Gammell, Chief People and Performance Officer

and managers that facilitates the management of personal and professional data and key transactions, such as leave requests, salary payment information and expense claims. Utilisation of iserve increased by 71 per cent in 2011. The new Employee Services intranet site, launched in January 2011, provides comprehensive information on employee policies and procedures around the clock to Etihad Airways employees wherever they are. The airline’s adoption of on-line learning was highly successful in 2011. There was a 500 per cent increase in courses delivered online, which enabled a training cost reduction of US$2.7 million.

The Etihad Airways Academy, now accredited by the International Air Transport Association (IATA), delivered almost 1,300 classroom-based courses to more than 12,700 participants, including a re-launched induction program called ‘Marhaba’, which equips new employees with information to achieve an accelerated start in the airline.

The health and safety of Etihad Airways employees is of utmost importance to the company.

As well as complying with all regulatory health standards, the airline offers a range of services and



1 In March 2011, the all-female Emirati Etihad Airways Al Ain Contact Centre was opened. This followed the completion of a nine month development program and subsequent graduation of 85 female UAE nationals from the Contact Centre program.

1

2 Etihad Plaza

3 Etihad Airways provides ‘Fit 2 Fly’ leisure facilities including gymnasiums, pools and

recreational amenities.

4 Etihad Airways Medical Centre offers state-of-the-art facilities and access to health and

welfare professionals for all staff.

3 4

benefits to support the wellbeing of its people. These include accommodation at a number of major residential locations in Abu Dhabi, including Etihad Plaza. The airline also provides ‘Fit 2 Fly’ leisure facilities including gymnasiums, pools and recreational amenities.

Occupancy of the airline’s Abu Dhabi residential portfolio for more than 4,000 employees and their families reached 93 per cent by the end of 2011.

Etihad Airways Medical Centre, based at Etihad Plaza, serves in excess of 650 employees each week. In addition to aviation and general medicine clinics, the centre also provides physiotherapy, dental services, radiology and ultrasound, and laboratory services. All clinic services are strictly regulated by the Health Authority of Abu Dhabi and the General Civil Aviation Authority.

There is a growing emphasis on disease prevention and health promotion for the airline’s staff, with Wellbeing Days firmly established as part of the events calendar in addition to organised screening campaigns for conditions including diabetes, cholesterol and certain types of cancer. The further development of Occupational Health Medicine and the provision of an Employee Assistance Program will play an important part in delivering the highest standard of services to our employees.

2010

7,85

5

7,82

8

9,03

8

2009

2011

Total Employees

920

10

10

9

2009

2011

Employee Cost per Aircraft(US$m)

13%

2010

9%

18%

2009

2011

Emiratisation(As a percentage of total employees less cabin crew and outstations)

2


Corporate governance is rigorously enforced in line with the Manual of Authority through carefully defined structures and processes. The Manual of Authority outlines authority limits delegated by the Board to the Executive Committee, management and staff in order to run the company’s affairs and operations.

The organisational structure ensures transparent reporting and necessary checks and balances. A 2009 report by leading global management consulting firm Oliver Wyman for the Abu Dhabi Audit Authority concluded that Etihad Airways had “established strong corporate governance and process redesign”.

Various layers of shareholder, management and regulatory oversight ensure continuous performance review against corporate strategic objectives and external standards.

Etihad Airways governance framework

Corporate Governance

ShareholderBoard Meeting – QuarterlyExecutive Committee – MonthlyAudit Committee – Quarterly

Management

Manual of AuthorityTender Board MeetingsInternal Audits

Regulatory

External Audit – KPMG AnnualFinancial Review – KPMG QuarterlyGovernment Audit – ADAA PeriodicOperations Audit – GCAA AnnualSafety Audit – IOSA Biennial

Meetings Objective Frequency Attendees

Board Meetings The Board meets the management of the company to ensure shareholder mandates are effectively implemented. The Board receives its authority from the shareholder and effectively delegates that to the management via the Manual of Authority.

Quarterly Board members, CEO, CFO and Chief Officers as required

Executive Committee Meetings

The Executive Committee meets management to discuss and authorise the carrying out of any activity deemed necessary to enable the company to achieve its commercial objectives and operational activities, and to review risks and formulate actions to address such potential risks.

Monthly A subcommittee of Board members, CEO , CFO and Chief Officers as required

Audit Committee The Audit Committee provide assurance to the Board over the qualification, independence, and performance of the registered public accounting firm (external auditor), and seeks advice from the company’s internal audit function as to the adherence to relevant governance standards.

At least five times a year

Two members of the Board, CEO, one independent member including a representative of Abu Dhabi Accountability Authority, Audit Committee Secretary (VP Internal Audit), CFO and other VPs as required

Chiefs Meetings The Chief Officers of the company meet to discuss and review performance to ensure the company achieves its commercial objectives. At this meeting the CEO updates his direct reports on issues affecting the company and feedback of Board, Executive Committee and other meetings. The Chief Officers update the CEO on issues and focus areas relating to their divisions.

Monthly CEO, Chief Officers

Performance Review Prioritisation Meetings

These meetings focus on the performance of the company including planned initiatives and continuous improvement.

Quarterly or as required

CEO, Chief Officers, PMO,

Cross functional VPs

Divisional Business Review Meetings (BRM)

The CEO meets with the management teams on a monthly basis to ensure the organisation’s performance is aligned to strategic objectives and a healthy operational environment exists. This is done through updating the CEO and other members of the BRM on initiatives, projects, risks and critical performance indicators and focus areas of the division.

Monthly CEO, Chief Officers, VPs, Departments Heads and Divisional Financial Controllers

Divisional Organisational Review Meetings (ORM)

Divisional Organisational Review Meetings (ORM) are held to review the divisional organisation structure and identify resource needs, gaps, efficiency measures, career development plans and succession planning.

Twice quarterly

CEO, Chief Officers and HR Business Partners

Etihad’s management reporting framework

A centralised Project Management Office (PMO) and a Value Management Committee ensure an ethical and objective process for the procurement of goods and services, managed by the Tender Board.

Etihad Airways has recently implemented a Fraud Control Policy and a reporting hotline to guide employees when faced with incidents of potential fraud. During 2012, the company’s anti-fraud efforts will be complemented by a comprehensive compliance program outlined in a new Code of Business Conduct. The program will be supplemented with dedicated training.



James Hogan President & Chief Executive Officer Australia

James Hogan was appointed President and Chief Executive of Etihad Airways on 10 September 2006, bringing more than 30 years of travel industry expertise to the airline.

Mr Hogan started his career in 1975 at Ansett Airlines, and subsequently held senior positions with bmi, Hertz, Forte Hotels and Gulf Air.

At Hertz, his roles included directorships of the marketing, sales and operations divisions. In 1995, based in London, he joined the executive management committee as Vice President, Marketing & Sales for Europe, Middle East and Africa.

In 1997, Mr Hogan became Service Director for bmi British Midland, leaving in 1998 to join the Granada Group as Worldwide Sales Director, where he sat on the board of Forte Hotels.

He returned to bmi in 1999 as Chief Operating Officer and a member of the Board, responsible for flight and ground operations, sales and marketing, commercial, cargo, engineering and handling service companies.

In 2002, Mr Hogan joined Gulf Air, where he served as President and Chief Executive for four years.

Mr Hogan is a fellow of the Royal Aeronautical Society and a former Non-executive Director, and member of the Board’s Audit Committee, of Gallaher Plc. In 2010, he served as the Chairman of the Aviation Travel and Tourism Governors at the World Economic Forum. He currently serves on the Executive Committee of the World Travel and Tourism Council. In June 2011 he was appointed to the International Air Transport Association (IATA) Board of Governors. Following the acquisition of a majority shareholding in Air Berlin plc, in December 2011, he was named Vice Chairman of the airline.

Richard Hill Chief Operations Officer United Kingdom

Captain Richard Hill joined Etihad Airways in January 2007 and was appointed Chief Operations Officer in April 2009.

He is responsible for Etihad Airways’ flight operations, inflight services, airport operations, technical, training standards, flight safety and quality and aviation security, including the airline’s emergency response procedures.

Captain Hill began his aviation career as a cadet pilot at British Airways in 1979. He spent 20 years with bmi British Midland, where he rose to the position of Director Flight Operations and finally Director Operations.

He joined Gulf Air in 2002 as General Manager Operations Technical and Head of Flight Operations. In 2006 he served as Head of the Flight Operations Inspectorate Department for the UK Civil Aviation Authority.

Captain Hill maintains his pilot qualifi-cation by operating as a Captain on the Airbus A330/A340 fleet.

Ray Gammell Chief People & Performance Officer Ireland

Ray Gammell joined Etihad Airways as Chief People and Performance Officer in April 2009.

He oversees all of the airline’s human resources functions, including recruit-ment, workforce development and performance management, as well as being responsible for Etihad Airways’ Emiratisation scheme.

Mr Gammell joined Etihad Airways from the Royal Bank of Scotland (RBS), where he was Director of Human Re-sources for Europe and the Middle East regional markets. Prior to that, he held similar positions at the Ulster Bank Group in Ireland and RBS European Consumer Finance, as well as with Intel Corporation in the USA.

Mr Gammell holds a Masters of Busi-ness in Organisational Development and HR Management from University College, Dublin, and is a fellow of the Chartered Institute of Personnel Development.

Jim Callaghan General Counsel & Company Secretary Ireland

Jim Callaghan became Etihad Airways’ General Counsel and Company Secre-tary in May 2009.

Previously, he spent nine years at Eu-rope’s largest low cost carrier, Ryanair Ltd, as Company Secretary and Direc-tor of Legal and Regulatory Affairs.

At Ryanair, Mr Callaghan was respon-sible for setting up the airline’s legal function and for corporate governance and liaison with the Board. He actively managed a suite of ongoing regulatory and legal issues relating to competi-tion law, trademarks, airport contracts, advertising standards, consumer law, and commercial litigation.

Before joining Ryanair in 2000, Mr Callaghan spent several years at inter-national law firms in the United States and in Brussels.

He holds a Juris Doctorate and a Mas-ters in Public and International Affairs from the University of Pittsburgh and a Masters in European and International Law from Vrije Universiteit in Brussels.

James Rigney Chief Financial Officer Australia

James Rigney was appointed Executive Vice Presi-dent Finance at Etihad Airways in October 2006, and became the airline’s Chief Financial Officer in March 2009.

Mr Rigney’s career in aviation has spanned two dec-ades. He joined Etihad Airways from Gulf Air where he was Head of Corporate Strategy.

Prior to joining Gulf Air in 2002, Mr Rigney held a number of senior strategic and commercial positions within the Ansett Group in Australia.

Mr Rigney is responsible for finance, treasury, informa-tion technology, supply chain and property at Etihad Airways. He is also a Non-executive Director of Abu Dhabi Aircraft Technologies (ADAT) and sits on the Board of airberlin.

A chartered accountant, he holds a Bachelor of Busi-ness and an MBA from RMIT University in Melbourne, Australia.

Peter Baumgartner Chief Commercial Officer Switzerland

Peter Baumgartner was appointed Chief Commercial Officer in April 2009. He joined Etihad Airways in April 2004 and has managed the airline’s intense global commercial efforts during a period of rapid growth – both its network expansion and the introduction of new product and service innovations.

Mr Baumgartner heads the commercial strategy and planning function, global sales, marketing, product, service delivery, call centres, e-commerce, Etihad Holi-days and the airline’s loyalty program, Etihad Guest.

Prior to joining Etihad Airways, he held a number of senior roles within the Belgian and Swiss aviation in-dustries, including at Swiss International Airlines where he was responsible for marketing development.

Peter Baumgartner is Chairman of the Board of Direc-tors of Hala Travel Management (HTM), a joint-venture company with BCD Travel B.V.

Kevin Knight Chief Strategy & Planning Officer United States of America

Kevin Knight joined Etihad Airways as Chief Strategy and Planning Officer in March 2011.

He is responsible for pricing, capac-ity and revenue management, route and network planning, alliances and aircraft acquisitions. He also leads Etihad Cargo.

Mr Knight has more than 30 years’ ex-perience in the airline industry, includ-ing business development, strategic planning and operations. Before join-ing Etihad Airways, he spent 17 years at United Airlines, the last five as Senior Vice President Planning. He previously held senior roles at Northwest Airlines and Republic Airlines.

Mr Knight holds a Bachelor of Science in Business Administration from West-minster College, Utah, and an MBA from the University of Utah.

Etihad Airways Executive


Belinda de Rome Senior Vice President Corporate Affairs Australia

Belinda de Rome was appointed Etihad Airways’ Senior Vice Presi-dent Corporate Affairs in August 2009.

She is responsible for the airline’s public affairs and corporate com-munications, including global media relations, social media strategy, internal communica-tions, corporate social responsi-bility, environmental affairs, and corporate events.

She joined Etihad Airways with more than 20 years’ experience in public relations and communica-tions gained in two of Australia’s pre-eminent corporations – Qan-tas Airways and the Common-wealth Bank of Australia – where her roles included responsibility for public affairs strategy, media relations, issues management, crisis communications, internal communications, marketing communications and sponsorship management.

Ms de Rome has a Bachelor of Arts degree in Communication and a Diploma in Education.

Gordon Penfold Senior Vice President Information Technology United Kingdom

Gordon Penfold was appointed Senior Vice President Information Technology in December 2010.

Leading the IT team, he is responsible for Etihad Airways’ technology and communications framework as well as IT develop-ment, delivery and maintenance.

Mr Penfold joined Etihad Airways from British Airways, where he was Chief Technology Officer.

His extensive experience includes sales, marketing, operations and business management roles in the IT services, telecommunications, defence and aviation sectors, with assignments in the UK, Europe, Japan and North America, and long-term postings in South Africa and Hong Kong.

In 1997 he joined British Airways as Director and General Man-ager of BA’s subsidiary company Speedwing Airport Services (Ma-laysia), managing the delivery of major projects at the new Kuala Lumpur International Airport at Sepang, and for the commercial development and P&L perform-ance of the company.

Mr Penfold graduated in Econom-ics and Law from the University of London, and gained postgradu-ate qualifications in Computer Science from Brunel University.

Werner Rothenbaecher Senior Vice President Technical Germany

Werner Rothenbaecher joined Eti-had Airways in November 2005.

Prior to joining Etihad Airways, he held a number of senior technical operational roles with Lufthansa, including assignments with Luf-thansa’s regional airline and cargo division.

His early career was with the Ger-man Air Force, where he led the maintenance organisation of the German Special Air Mission Wing and reached the rank of Lieutenant Colonel.

At Etihad Airways, he is respon-sible for engineering, technical purchasing and contracts, the technical operations control cen-tre, aircraft cost control, aircraft specification, technical quality and reliability control, and line maintenance in Abu Dhabi and worldwide.

Mr Rothenbaecher has a Masters degree in Aircraft Engineering and Aero Space Technology from the University of Munich.

Geoff Linaker Senior Vice President Operations United Kingdom

Geoff Linaker joined Etihad Airways in 2010 as Senior Vice President Operations, after serv-ing with bmi British Midland as Director of Operations.

He has 35 years’ experience in the aviation industry, including 15 years as a regulatory Postholder.

His previous roles include air-crew instruction, examining and technical management.

He is responsible as the GCAA nominated Postholder for Etihad Airways Flight Operations, Guest Services, Crew Resources and Operations Logistics, in addition to his management role as a cur-rent A330 Captain.

Hasan Al Hammadi Senior Vice President Executive Affairs United Arab Emirates

Hasan Al Hammadi joined Etihad Airways in 2009 as Vice President Special Projects, and was ap-pointed Senior Vice President Executive Affairs in 2010, with additional responsibility for cor-porate security.

Mr Al Hammadi has more than 25 years’ experience as a senior adviser to the UAE Government on matters of security, intelli-gence, national and international political relations, protocol and diplomatic affairs.

He has held various senior roles across the Ministry of Interior, State Security, and the Crown Prince Court as well as the Presidential Court. He is a former Director of Private Protocol in the office of the late HH Sheikh Zayed bin Sultan Al Nahyan, Ruler of Abu Dhabi and President of the UAE.

Mr Al-Hammadi holds a degree in Petroleum Engineering from Manchester University.

Khaled Al Mehairbi Senior Vice President Government and Aeropolitical Affairs United Arab Emirates

Khaled Al Mehairbi joined Etihad Airways in January 2004 as Head of Corporate Affairs.

He was appointed Senior Vice President Government and Aeropolitical Affairs in 2009, and is responsible for UAE and international government affairs, negotiating bilateral air service agreements for the airline.

Before joining Etihad Airways, Mr Al Mehairbi was Airport Direc-tor of Abu Dhabi International Airport. He also served as Gen-eral Manager Abu Dhabi Airport Services.

He has extensive experience in airport operations, includ-ing ground handling and civil aviation.

He is Chairman of the Aeropoliti-cal Watch Group of the Arab Air Carriers Organisation.

Mr Al Mehairbi has a Bachelor of Business from the USA’s Salem University.

John Shepley Senior Vice President Network Management Australia

John Shepley joined Etihad Air-ways in November 2006 as Vice President Network Planning

He was appointed Senior Vice President Network Management on December 1, 2011, and is re-sponsible for development of the airline’s network and schedules, as well as developing and manag-ing Etihad Airways’ relationship with more than 35 airline partners worldwide.

Before joining Etihad Airways, Mr Shepley was with Australia’s Jetstar Airways, where he was General Manager Network & Schedules Planning, responsible for all domestic and international planning with a fleet of over 50 wide- and narrow-body aircraft.

He has more than 20 years’ experience in aviation, including senior positions with Ansett Aus-tralia, Air New Zealand and Gulf Air in Sales, Airports, Revenue Management, Planning and Alli-ance areas.

Carolyn Prowse Senior Vice President Corporate Strategy & Special Projects United Kingdom

Carolyn Prowse joined Etihad Air-ways in January 2012 to head up corporate strategy, mergers and acquisitions and other special projects. She is also responsible for the Project Management Office at Etihad Airways, which manages key projects and has oversight of all other major pro-jects to ensure effective delivery and strategic alignment of all projects with the airline’s business objectives.

Prior to joining Etihad Airways, she was Managing Director, Head of Asset Management for Ithmaar Bank BSC in Bahrain, where she was responsible for a global port-folio of private equity, investment banking and strategic invest-ments. Her aviation experience includes working as a Senior Manager for Investments and Joint Ventures at British Airways Plc.

Ms Prowse has extensive ex-perience in corporate strategy, mergers and acquisitions and restructuring.

She has a Bachelor of Arts (Hons) degree in Chemistry from St Anne’s College, University of Oxford

Roy Kinnear Senior Vice President Revenue Management and Planning Northern Ireland

Roy Kinnear joined Etihad Airways in 2006 as Vice President Revenue Management.

He was appointed Senior Vice President, Cargo in 2010 and to his current role, as Senior Vice President Revenue Management and Planning in 2011.

Mr Kinnear oversees the revenue management and commercial planning for Etihad Airways passenger and cargo business streams.

He has 20 years’ experience in aviation, having previ-ously worked in pricing, revenue management and scheduling for British Midland Airways.

Mr Kinnear has previously held the position of Chairman of the Board of Amadeus Gulf, the joint venture GDS company majority-owned by Etihad Airways, and is currently Chairman of the Board of Armaguard Valuables Management LLC, a joint venture company majority owned by Etihad Airways for the handling of high value cash and valuables shipments.

He has a Bachelor of Science Economics and Statistics honours degree from the University of Ulster.

Etihad Airways Management


• World’s Leading Airline – World Travel Awards

• World’s Leading First Class – World Travel Awards

• World’s Leading Airline to the Middle East – World Travel Awards

• World’s Best First Class – Skytrax Awards

• World’s Best First Class Onboard Catering – Skytrax Awards

• World’s Leading Airline – Arabian Business Magazine

• Airline of the Year – TTG Travel Awards

• Best Business Class – Biz Travel Forum, Milan

• Business Airline of the Year – Guardian Observer Travel Awards

• Middle East’s Leading Airline – World Travel Awards

• Middle East’s Leading Airline First Class – World Travel Awards

• Middle East’s Leading Airline Inflight Entertainment – World Travel Awards

• Middle East’s Leading Cabin Staff – World Travel Awards

• Web Excellence, Airline category – Pan Arab Web Awards

• Best Co-Branded Card in the Middle East – Smart Card Awards Middle East

• Best Long Haul Airline – Irish Travel Awards

• Best Economy Class – Monitor Airline of the Year Awards

• Best Meal in Economy Class – Monitor Airline of the Year Awards

2011 Awards recognition of our excellence

– جوائز ال�سفر العاملي • جائزة �سركة الطريان الرائدة على م�ستوى العامل – جوائز ال�سفر العاملي • جائزة الدرجة الأوىل الرائدة على م�ستوى العامل

– جوائز ال�سفر العاملي • جائزة �سركة الطريان الرائدة على م�ستوى العامل – جوائز �سكاي تراك�س اأف�سل درجة اأوىل على م�ستوى العامل • جائزة

– جوائز �سكاي تراك�س اأف�سل خدمة اأطعمة على منت الدرجة الأوىل • جائزة – جملة الأعمال العربية • جائزة �سركة الطريان الرائدة على م�ستوى العامل

)TTG( جوائز ال�سفر من جملة ترافيل تريد جازيت – اأف�سل �سركة طريان يف العام • جائزة – منتدى ال�سفر بيز، ميالن • جائزة اأف�سل درجة اأعمال

– جوائز ال�سفر من موقع اجلارديان واأوبزيرفر • جائزة اأف�سل �سركة طريان لقطاع الأعمال يف العام – جوائز ال�سفر العاملي • جائزة �سركة الطريان الرائدة على م�ستوى ال�سرق الأو�سط – جوائز ال�سفر العاملي • جائزة الدرجة الأوىل الرائدة على م�ستوى ال�سرق الأو�سط

– جوائز ال�سفر العاملي • جائزة اأنظمة الت�سلية على منت الطائرة الرائدة يف ال�سرق الأو�سط • جائزة �سركة الطريان الرائدة يف موظفي املق�سورة على م�ستوى ال�سرق الأو�سط – جوائز ال�سفر العاملي

– اجلوائز العربية ل�سبكة الإنرتنت • جائزة التفوق يف �سبكة الإنرتنت، فئة �سركات الطريان – جوائز البطاقات الذكية يف ال�سرق الأو�سط • جائزة اأف�سل بطاقة م�سرتكة العالمة التجارية يف ال�سرق الأو�سط

• جائزة اأف�سل �سركة طريان للرحالت الطويلة – جوائز ال�سفر الأيرلندية– مونيتور اإيرلين جلوائز العام • جائزة اأف�سل درجة �سياحية

• جائزة اأف�سل وجبه على الدرجة ال�سياحية - مونيتور اإيرلين جلوائز العام

جوائز عام 2011 تقدير عاملي للتميز والإبداع

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