Sterling A/S - Fly for Less -

FL Group Capital Markets Day, 21 September 2006 Company introduction

2 Introduction

• Largest LCC in Nordic region • 4th largest LCC in Europe • 2nd largest at CPH • Excellent product, high quality point-to-point traffic at low prices in a young fleet • Only LCC covering all 3 Scandinavian capitals • Strong brand name in , established more than 30 years ago • Young fleet of 25 737 aircraft, predominantly “new generation” versions • 1,400 employees

3 2006 traffic by activity/base

Total traffic by activity Scheduled traffic by base

Helsinki/other 2% Charter 19% 21%

Copenhagen 44%

Oslo 23% Scheduled Billund (DK) 79% AALborg (DK) 2% 10%

• Over 4 million passengers in 2006 • Improvement from pro-forma 2005, with significant change in business mix: – Unprofitable code-share traffic terminated, reduction of app. 25% of Air passengers – Unprofitable charter contracts not renewed – Strong organic growth in Stockholm (+20%) and (+35%) • Charter activities currently at relatively low level, Sterling will only bid for profitable contracts in the future due to strict focus on quality and profitability

4 Route overview (scheduled services)

Copenhagen Oslo Stockholm Billund (DK)

• Combination of leisure and business/city-break routes • Primarily to tier 1 airports and destinations • Strong market share on selected destinations, building share on other routes • Long term focus on reducing seasonality and sector length

5 Market position, international traffic (H1-2006)

Copenhagen Oslo Stockholm

No. Carrier Cap. share* No. Carrier Cap. share* No. Carrier Cap. share* 1 SAS 51% 1 SAS 47% 1 SAS/Blue 1** 41% 2 Sterling 11% 2 Norwegian 19% 2 Lufthansa 6% 3BA 3% 3 Lufthansa 5% 3 6% 4 Norwegian 2% 4 Sterling 5% 4 Sterling 5% 5 Air 2% 5 BA 4% 5 FlyNordic 4% Others (51) 31% Others (30) 20% Others (47) 38%

*) Based on offered capacity, source OAG, Airlines. Fiugures exclude charter **) Blue 1 is a subsidiary of SAS. Blue 1 accounts for 7% and SAS for 34%

• SAS still enjoy a strong market position throughout Scandinavia • Future growth may come from a variety of sources: – Ancillary revenues, key to LCC success – Overall market is constantly expanding – Taking market shares from competitors – Penetration of the domestic markets, “Scandinavian triangle”, and possibly new markets

6 Competitive position

Figures from H1-2006

PAX (m) 1.9 18.9 0.4 n.a. 2.3 n.a.

Cabin Factor (%) 76% 71% 61% n.a. 78%

Sales (EURm) 264 3,512 37 n.a. 158 n.a.

No. Aircraft 25 306 5 9184

Bases DK, NO, SE DK, NO, SE SE SE NO, PL SE

Focus (Intl./dom.) Intl. Mix Mainly dom. Mainly dom. Mix Intl.

Ownership FL Group Listed Listed Finnair Listed

Current market cap (EURm) n.a. 1.347 18 n.a. 205 n.a

• SAS faces numerous structural challenges, strong unions, old fleet….. • FlyMe and FlyNordic lack necessary scale to be profitable • Norwegian enjoys strong domestic position, but lack Scandinavian presence • Sterling is the only pan-Scandinavian LCC player • Local LCC consolidation/shake-out expected, Sterling ideally positioned to benefit

7 Merger process

8 Obvious merger case

Maersk Air Sterling

3.500 5% 3.500 5% 3.000 0% 3.000 0% 2.500 -5% 2.500 -5%

2.000 -10% 2.000 -10%

1.500 -15% 1.500 -15% DKKm 1.000 -20% DKKm 1.000 -20%

500 -25% 500 -25%

- -30% - -30% 2000R 2001R 2002R 2003R 2004R 2000R 2001R 2002R 2003R 2004R (500) -35% (500) -35%

(1.000) -40% (1.000) -40%

Sales EBIT EBIT-margin Sales EBIT EBIT-margin • was in severe financial distress by mid 2005, no clear way out • Sterling was in better shape but lacking scale • Companies were direct competitors on number of routes • Companies physically located 200m apart in CPH airport • Previous owners beginning to consider aviation as a non-core activity • Both companies acquired within a three month period

9 Very different business models, but strong commercial fit

Sterling Airways Maersk Air (airline activity) • NB AOC • DM/349 AOC • Non-IATA • IATA • 1 cabin class • 3 cabin classes (S/M/L) • Mostly southern Europe • Focus on northern Europe • Predominantly leisure • Even split business and leisure • Internet distribution • GDS and travel agent distribution • Codeshares (seat swaps only) • Codeshares (interactive/realtime) • Ticketless • BSP tickets • Lease in 737-800s • Owned 737-500s / -700s • Outsourced maintenance • Inhouse maintenance • No cargo • Cargo and cargo GSA activity • Built on low cost business model and management team • Combination provided strong synergy potential: – Uniform fleet of 737 in various sizes improved flexibility and maintenance cost – More balanced mix of destinations reducing sector length and seasonality – Improved bargaining power towards most suppliers, significant adm. cost reductions – Improved load factor and schedule on joint destinations • High level of implementation complexity • Unfavorable external factors, SAS response, fuel price, bird flu/Mohammed

10 Integration process nearly finalised

• Originally expected to take 12-15 months (EasyJet-Go took 15-18 months) • Integration process more or less finalised by mid 2006 (6-9 months) – Negotiating of new collective bargaining agreements almost closed • Integration period has been extremely demanding for the whole organisation • True cost of restructuring goes beyond traditional merger cost (redundancies etc) • Business model/system transparency is constantly improving • Organisation is now more capable of looking forward and is entering into a period of internal optimisation

11 Operational status

12 Cabin factor only marginally below competitors

H1-2006 Cabin factor

85%

80% Sterling H1-2006 75%

70%

65%

60%

55%

50%

45%

40% FlyMe SAS Air Berlin Norwegian Ryanair Easyjet Sterling H1- Maersk 2005 H1-2005 • H1 2006 cabin factor reflect suboptimal flight program and aborted Finnish expansion • Cabin factor expected to improve in H2-2006 and 2007 due to combination of: – Improved flight schedule (better market knowledge, no legacy) – Adjusted fleet size/composition • Long term ambition to achieve +80X% CF on average (incl. ramp-up routes)

13 Cost efficiency at par with key competitors

Cost per ASK (EURc)

10 9 8 7 Sterling H1-2006 6 5 4 3 2 1 0 Easyjet Air Berlin Norwegian SAS FlyMe

• Cost efficiency measured by Available Seat Kilometer (ASK) • Sterling at par with LCC competitors – Sterling’s relatively long sector length reduces overall cost per ASK – Sterling H1-2006 cost per ASK includes restructuring cost • Long term ambition to bring cost per ASK down to EURc 4

14 Cost structure highly dependent on fuel price

Jet Fuel price last 3 years Jet Fuel price last 6 months

+23%

• Directly production related cost represent significant part of total cost • Profitability improvements mainly to come from better crew/fleet utilisation • A 10% change in fuel price impact total cost structure by some 2.2% • Fuel price has increased rapidly during recent years: – Spot price reached 750 USD/t in August 2006, a 300% increase from August 2003 – Cost increases only marginally reflected in average yield per passenger

15 Key Financial Figures

16 H1-2006 turnover slightly above 2005

Turnover 2005 vs. 2006 (DKKm)

550 500 450 400 350 300 250 200 150 100 50 - Jan Feb March April May June July Aug Sep Oct Nov Dec

Turnover 2005 Turnover 2006 • Turnover slightly above pro-forma 2005 • In 2006 Sterling is able to deliver the 2005 production with: – 3 fewer aircraft (-14%) – 450 fewer employees (-23%) • In 2007 Sterling is able to deliver the 2006 production with even lower capacity

17 EBITDA 2006 vs. pro-forma 2005

EBITDA 2005 vs. 2006 150 -

(100) 100

(200) 50

(300) e y

- (400)

(50) (500) DKKm -DKKm monthl

(600) - cummulativ DKKm (100) (700)

(150) (800)

(200) (900) Jan Feb March April May June July Aug Sep Oct Nov Dec

2005 2006 Acc 2005 Acc 2006

• Pro-forma performance during H2-2005 was extremely bad • 2006 YTD impacted by merger cost and suboptimal production, especially Q1 • Q2 shows significant improvement, expected to continue ROY • The winter program 06/07 is the first program fully free of integration legacy • Full effect of merger will be visible in 2007, strong improvement expected

18 Summary

• Strong brand name, widely recognised throughout Scandinavia • Strong market position: – Undisputed number 2 position in Copenhagen – Currently number 4 in both Oslo and Stockholm, expected to climb the list in near future • Numerous opportunities to grow revenue from traffic and ancillary products • Ideally positioned to benefit from future industry consolidation/shake-out • Turnaround process has been challenging, but is nearing its end • Efficient LCC model, cost structure in line with peers • Financial performance improving, significant opportunities to optimise further

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