A E R O F L O T G R O U P
Q3 & 9M 2020 IFRS RESULTS
1 December 2020
Speakers:
Andrey Chikhanchin – Deputy CEO for Commerce and Finance Andrey Panov – Deputy CEO for Strategy, Service and Marketing Ivan Batanov – Head of Revenue Management
Disclaimer
This document has been prepared by PJSC “Aeroflot” (the “Company”). By attending the meeting where the presentation is made, or by reading the presentation slides, you agree to the following.
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2
Aeroflot Group Q3 2020 Highlights
- Total PAX Decline
- Strong Domestic PAX
- Recovery of Revenue
- Raising Liquidity
Million PAX
- Million PAX
- Billion RUB
- RUB
(7.3)%
3.3x
(45.3)%
10.3 mln
84.9
80 bn
share placement
18.5
Proceeds from
10.1
9.5 mln
25.5
70 bn
Loan agreements backed by state guarantees
- Q3 2019
- Q3 2020
- Q3 2019 Q3 2020
- Q2 2020 Q3 2020
Note: immaterial deviations throughout the p resentation are explained by rounding
In Q3 2020 the Group recovered a significant portion of operations and improved financial performance compared to Q2 raising additional liquidity to withstand headwinds of the coming low season.
3
1. Market Update and Operating Results
2. Network and Schedule Overview 3. Fleet Overview 4. Financial Performance 5. Appendix 1: Strategy 2028
6. Appendix 2
4
Overview of the Russian Market
- Passenger Traffic: Market vs Aeroflot Group
- Key Market Players
Russian Air Transportation Market (million PAX)
incl. PAX of Russian and Foreign Carriers and intl. transit PAX
Change in PAX million
-23.7
(50.9)%
23.1
-4.7
9.2
-12.5
12.4
International Routes Domestic Routes
114.0
-2.9
4.5
-2.8
3.6
-11.5
3.4
(47.1)%
57.7
47.8
56.0
Aeroflot Group
S7 Group Ural Airlines UTair Group Foreign
Carriers
Others
14.2
24.8
25.3
2.6
56.3
41.8
23.1
22.7
Market Shares
- Q3 2019
- Q3 2020
- 9M 2019
- 9M 2020
- 9M 2019
- 9M 2020
22.2%
Aeroflot Group (million PAX)
(50.7)%
21.8%
(45.3)%
41.0%
41.2%
46.7
6.0%
6.3%
8.0%
13.0%
5.6%
21.0
18.5
23.1
6.5%
8.3
- 12.1%
- 16.3%
10.1
9.5
5.2
0.6
25.8
10.3
17.9
- Foreign Carriers
- Others
- Q3 2019
- Q3 2020
- 9M 2019
- 9M 2020
Source: TCH, Aeroflot Group. Figures include foreign carriers’ traffic.
The market’s and Aeroflot Group’s performance substantially improved in Q3, though remained under pressure due to
ongoing restrictions for international operations.
5
Domestic Market Recovery in Q3 2020
- Total PAX Traffic Trends: Q2 vs Q3
- Domestic PAX Traffic Trends: Q2 vs Q3
- Million PAX
- Million PAX
47.8
38.1
- (87.9)%
- (47.1)%
- (75.8)%
- (1.5)%
- 18.4
- 23.1
22.7
25.3
4.5
4.6
- Q2 2019
- Q2 2020
- Q3 2019
- Q3 2020
- Q2 2019
- Q2 2020
- Q3 2019
- Q3 2020
Source: TCH, Federal Air Transport Agency, Aeroflot Group calculations
Source: TCH, Federal Air Transport Agency, Aeroflot Group calculations
Domestic segment which contributes around half of the total Russian market posted rapid recovery after easing of domestic travel restrictions in June 2020.
6
Russian Domestic Market: Global Champion by
Recovery Pace
- Russian domestic PAX has recovered almost immediately…
- … with PAX growth in various regions.
Domestic PAX, y-o-y
Selected Russian Airport Statistics (PAX), September,
y-o-y change
- Jan
- Feb
- Mar
- Apr
- May
- Jun
- Jul
- Aug
6%
Sep 7%
Murmansk
+ 15%
8%
5%
(15%)
(16%)
(59%)
- (84%)
- (87%)
Source: TCH
Kaliningrad
Kirov
+ 35%
+ 47%
… making Russian market the fastest to recover globally…
September 2020, y-o-y
Ulyanovsk
- Domestic markets
- RPK
- PLF (pp)
- PLF
- World share
+ 47%
Anapa
+73%
World
Russia
China Brazil
-43%
7%
-12%
-3 pp
-4 pp
70%
82%
79% 81% 58% 57%
54%
36.2%
1.5%
9.8% 1.1% 1.1%
14.0%
0.8%
-3%
Sochi
+41%
Makhachkala
+25%
-55% -59% -65%
-89%
-1 pp
Japan USA
-20 pp -26 pp
- -28 pp
- Australia
Source: IATA, FAVT, data for Russian market is taken from FAVT, world market share is based on FY2019
Source: based on FAVT and airport data
Russian domestic market – the only one among key global markets to fully recover, already in August 2020 – just 1.5
months after the lockdown was over (based on IATA statistics).
7
Aeroflot Group Performance Across Different Brands
9M 2020 PAX Contribution1 and Dynamics
Brand
October 2020
Business Model
-59.1%
••••
Flagship carrier
50.4%
28.4
-66% PAX -69% ASK
Premium product (4 Stars) High income and middle class Hub and spoke model
Premium Low Cost Mid-price
11.6
11.6
- 9M 2019
- 9M 2020
-16.7%
••
Point-to-point carriage Focus on domestic segment and underserved international routes
7.6
6.3
+11% PAX
+7% ASK
6.3
27.4%
- 9M 2019
- 9M 2020
•
Scheduled network under SU (Aeroflot) code from
-52.2%
-41% PAX -47% ASK
9.4
−
Moscow (SVO)
4.5
19.6% 2.7%
4.5
−
St. Petersburg (LED)
•
Charter operations
- 9M 2019
- 9M 2020
-52.2%
•
Airline for communities in the
Russian Far East offering
flights
1.3
-54% PAX -42% ASK
0.6
Regional
0.6
− between large cities
− to remote cities
9M 2020
9M 2019
Source: Aeroflot Group 1 PAX contribution as of 9M 2020. Absolute number of passengers in million in green circle
In Q3 2020 the Group recorded continued recovery of the domestic segment, but the overall result for 9M 2020 was still
under pressure from international segment’s slower reopening.
8
Pobeda Airline: Timely Value Proposition
- Total PAX dynamics in 2020
- Overview
mn PAX, change y-o-y
Growing PAX numbers from July 2020
after restarting operations in June
2019 2020
3.4
3.0
2.5
2.5
6.3 mm PAX
transported in 9M 2020 (-16.7% y-o-y)
2.0
92.7% PLF
0.4
LF remained high in 9M 2020 despite ongoing pressure
34 B737NG aircraft
Q1
22.2%
Q2
(82.5)%
Q3
with single class cabin (189 seats)
12.1%
17 p.p. RPK mix shift
from international to domestic in 9M 2020 y-o-y
Beginning of 2020 route network
Operating Indicators of October 2020
Petrozavodsk
Surgut
Helsinki
Traffic above 2019 levels
Kirov
14
Saint Petersburg
Perm
Ekaterinburg
Krasnoyarsk Tomsk
Moscow
Kazan
Riga
Novosibirsk
Cheboksary
62
Tyumen
Nizhnekamsk
Ulyanovsk
Samara
Kemerovo
- Omsk
- Kaliningrad
Chelyabinsk
Magnitogorsk
Eindhoven
Ostende
Berlin
- Leipzig
- Ulan-Ude
91.5%
6 045
Cologne
Karlovy Vary
Baden-Baden Memmingen
Salzburg
1 044,3
Volgograd
Astrakhan
Nazran
Bratislava
Rostov
Krasnodar
Innsbruck Venice
Bergamo Genova
Pisa
Min.Vody
Anapa
Gelendzhik Varna
12
Rimini Tivat
Sochi
Vladikavkaz
Istanbul
Makhachkala
Tbilisi Gyumri
- Girona
- Rome
- Bari
- Batumi
- Traffic, th PAX
- Revenue flights,
cycles
PLF, %
Cagliari
Palermo
Antalya
Gazipaşa
Bodrum
Dalaman
Catania
Larnaca
- 15.6%
- (4.2) p.p.
- 10.6%
Cities the airline operates flights to
Base cities with >10 routes served from city
(number of routes in circle)
XX
Cities with <10 routes served from city
Source: Aeroflot Group
Pobeda continues to lead the industry recovery leveraging its value proposition appealing to cost conscious passengers.
9
1. Market Update and Operating Results
2. Network and Schedule Overview
3. Fleet Overview 4. Financial Performance 5. Appendix 1: Strategy 2028
6. Appendix 2
10
Aeroflot Group Network Adjustments
Beginning of 2020 route network
- Stockholm
- Helsinki
Tallinn
Oslo
Murmansk
Salekhard
Arkhangelsk
New Urengoy
- Khanty Mansiysk
- Syktyvkar
Surgut Ekaterinburg Tyumen
Riga Kaunas Berlin
Saint Petersburg
- Yakutsk
- Nizhnevartovsk
Kemerovo
Nizhnekamsk Nizhny Novgorod
MOSCOW
- Perm
- Magadan
Copenhagen
Minsk
MOSCOW
Hamburg
Krasnoyarsk
- Samara
- Novosibirsk
- Omsk
- Kaliningrad
Berlin
- Kazan
- Tomsk
- Novokuznetsk
Minsk
- Ufa
- Voronezh
Saratov
Abakan
Amsterdam
Chelyabinsk Kostanay
Irkutsk
Hamburg Dusseldorf Orly Paris
P. Kamchatsky
Hannover
Barnaul
Warsaw
Astana Karaganda
Almaty
Shymkent
Bishkek
Magnitogorsk
London Brussels
Frankfurt Paris
- Orenburg
- Frankfurt
Dusseldorf
Dresden Prague Vienna
Khabarovsk
Yu. Sakhalinsk
- Belgorod Volgograd
- Aktobe
Prague
Munich
- Rostov
- Atyrau
Astrakhan Stavropol
Ulan Bator Beijing
Chisinau Gelenzhdik Simferopol
Sochi Mineral Waters Istanbul
- Harbin
- Vienna
Rimini
Milan
- Nice
- Aktau
Makhachkala Baku
Anapa Burgas Varna
- Adler
- Vladivostok
- New York
Chisinau
Stuttgart
Rome
- Barcelona
- Tivat
- Tashkent
Budapest
- Munich
- Zurich
Geneva Lyon
- Yerevan
- Samarkand
Krasnodar Teheran
- Dalian
- Washington
Antalya Larnaca
Tokyo
Seoul Busan
Belgrade
Venice
Beirut Tel Aviv
Milan Nice
Los Angeles
Bucharest
Shanghai
Delhi
Zagreb Sofia
Bologna
Split
Tivat
Barcelona
Miami Havana
Guangzhou Hong Kong
Dubai
Rome
- Istanbul
- Tbilisi
- Madrid
- Thessaloniki
Hanoi
Valencia
Lisbon
Alicante
Malaga
Athens
Antalya
Larnaca
Bangkok
Ho Chi Minh City
Heraklion
Phuket
Male
Aeroflot routes Rossiya routes Aurora routes
Tenerife
# of Flights Evolution by Region, 9M 2020 y-o-y1
2020 Domestic Scheduled Network (flights per day, av.)
Russia Europe
(27.9)%
- 132
- 327
199
409 130