COMPANY PROFILE 2010 2010

ATR-72-500

BEECH 1900 D ATR-42-320 www.buddhaair.com Since 1997

With the reinstatement of Air Pvt. Ltd. The airline, multi-party democracy established in October in in 1990 and the 1997 with the objective of subsequent liberalization giving people a safe and of the economy, the private reliable air transport service sector was encouraged and went on evolving in to invest in public the subsequent years. Now infrastructure and services. it is the leading airline in Against this backdrop, the country. From the very retired Supreme Court (SC) beginning passenger safety justice Surendra Bahadur was placed in the highest Basnet realized the need and priority. This core value has growing demand for mass helped Buddha Air earn the public transport in Nepal. trust of millions who have And the result is Buddha flown with it. company summary

Name of the Company Buddha Air

Year of Establishment 11.10.1997

Executive Chairman Surendra Bahadur Basnet

Managing Director Birendra Bahadur Basnet

Type of Business International/ Domestic Flight Operator

No. of Aircraft Eight

Type of Aircraft Pressurized Beech 1900D (4) ATR 42-320 (3) ATR 72-500 (1)

No. of International Sector Destinations 1. 2. Bhutan - Paro (from 23 August 2010) 3. India (from 16 September 2010) a. Kolkata b. Lucknow c. Patna

No. of domestiC Sector Destinations 1. Kathmandu 2. everest Experience 3. Bhadrapur 4. Bhairahawa 5. 6. 7. Nepalgunj 8. Janakpur 9. Simara 10. Bharatpur 11. Dhangadhi 12. (after the runway is asphalted) ge

p a 3 AIRCRAFTS

ATR-72

ATR 72 was developed from ATR 42 in order to increase the seating capacity from 47 to 72. With the addition of the ATR 72, Buddha Air has now four ATRs including three ATR 42 and four 1900D Beechcrafts in its fleet. Buddha Air is very proud of the fact that the ATR Company leased out ATR 72 to the airline. It is due mainly to the impeccable image of Buddha Air and the vision of its management to drive the airline business on the right track. It must be recalled that Nepali airlines had already lost their credibility with the ATR Company, but Buddha Air’s track record and vision won the confidence of the aircraft manufacturer. If things go as planned, Buddha Air will import two ATR-72 aircrafts, by the end of 2011. ge p a 4 ATR 42

In a strategic move to adapt in the face of a rapidly evolving competitive landscape, Buddha Air bought two ATR 42-320 aircrafts with USD 10 million loan from the International Finance Corporation Beech 1900 D (IFC), a member of the World Bank Group. The airline started operating Buddha Air entered these 47-seater aircrafts from service in 1997 with one September, 2008 with a remarkable Beechcraft 1900D, and now success and added another such it has four such airplanes, aircraft within a year. The twin- among others. It is the latest turboprop aircraft, built in France version of the world famous and Italy by ATR Company, is safe, Beechcraft 1900 series, comfortable, and environment- and over 400 such planes friendly. The ATR Company began are currently in operation manufacturing ATR 42s in 1985, worldwide. It is also a and well over 900 such planes are choice of the American currently in service with more than Aircraft Pilot’s Association. 65 airlines worldwide. The low- Manufactured by the US- operating cost of these aircrafts has based Raytheon Aircraft enabled Buddha Air to issue the low Company (now Hawker cost B-class air tickets for Nepali Beechcraft), the 18-seater passengers. aircraft is safe, comfortable and reliable. Powered by two Pratt & Whitney PT6A- 67D turboprop engines, Beechcraft 1900D is regarded as one of the best airplanes of the world. ge

p a 5 marketing

uddha Air is the fastest without the dedicated employees Bevolving airline in Nepal. It is of the Marketing Department. The the leading airline in domestic civil department ensures that passengers aviation and conducts the best Mt get the best services possible and Everest sight-seeing flights. Making frequently interacts with tour headway through the cutthroat and travel operators to enhance competition of Nepal’s civil aviation the services. It is also equally sector would have been impossible concerned with making travels safe, reliable and comfortable. Our in-house trimester publication Buddha Yatra is in its fourth year with 15,000 copies of every issue being distributed around. Yatra also contains a feedback questionnaire, and passenger feedback is promptly acted upon. 6.28% Guna Air Airlines 13.02% The ATR 42-320 Agni Air provides passengers Market with an on-board comfort and Share services43.74% comparable to the jetlinerBuddha Air Comparison Buddha Air Yeti Air 2009-2010 36.95% Agni Air Yeti Air Guna Air (only Buddha Air operating sector)

Number of Flights Comparison (1997-2010)

23835 23021 23764 22198 21199 19788 21018

14433

11210 10674 9476 7582

3916

97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10

Total Passenger Comparison (1997-2010)

600,000

500,000

4000,00

300,000

200,000

100,000

0 97/98 98/99 99/00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 ge

p a 7 E-ticketing In a move to catch up with the pace of time, Buddha Air has begun issuing e-tickets to Nepali passengers. It is through F1 Soft International’s website e-sewa that you can buy e-tickets. F1 Soft International transfers the money you have paid to buy your tickets Royal Club to Buddha Air. This new service has made the purchasing of tickets easier for our tech-savvy In 2002, Buddha air launched its frequent flyer program, the customers. Now travel agencies are also able Royal Club, which rewards passengers with mileage points to issue tickets online as per their agreement every time they fly. When accumulated, these points can be with Buddha Air. Similarly, General Sales redeemed for free tickets, holiday packages or shopping. We are Agent will be handling the selling of tickets in the first to introduce this program in the country. We launched Bhutan and various Indian cities. the Platinum Membership Program in 2005. This special group receives more benefits than the ordinary members do. We are proud to have 77,000 Royal Club gold card members and 4,250 Platinum members. We run the largest frequent flyer program in the country. In August 2007 we launched the part-miles- plus-part-cash scheme for our valued members; it offers more flexibility in payment by allowing members to redeem their reward by paying cash in part. ge p a 8 77,000 Royal Club Gold Card members

4,250 Platinum Members. engineering

ur Engineering the department is ODepartment is subdivided into one of the largest Maintenance, in the country with Maintenance 16 engineers, 29 Planning, Workshop, technicians, and Quality Assurance, 36 corporate staffs. Technical Records, The Engineering Library, and Department, which Procurement and is the backbone of Stores. Besides we the company, is entrusted with the task of also have a very good storage of spare maintaining each aircraft in an airworthy parts. Officials from The CAAN, Hawker condition. All engineers are provided Beechcraft, Pratt and Whitney Canada, periodic refresher training by aircraft COSCAP and ATR frequently visit the manufacturers. For assured effectiveness, department to ensure that all is well.

Buddha Air’s ATR and Beech aircraft are powered by Pratt & Whitney Canada engines. Under our supervision, they have an impeccable maintenance and safety record, not only in Nepal but across the South Asia region.

n Mr. Vellu Venu Regional Sales Manager Pratt & Whitney Canada ge p a 10 OPERATION

uddha Air began with one 1900D over 10,000 hours in total. The airline also BBeechcraft, six commanders and six co- sends its pilots and technicians abroad for pilots operating flights in five destinations in various types of refresher training in aircraft Nepal. Today it has evolved into the leading designated six axis simulators. Pilots flying airline in the country. The Airline has now Beechcrafts are sent to New York every year 100 employees in its Operation Department, for weeklong flight simulation refresher thus eliminating hectic schedules of pilots training, while those flying ATRs are sent to and technicians, which is one of the major Malaysia and Bangkok every six months for causes of accidents all over the world. the same. Similarly, dispatchers are also sent All commanders have logged in at least to Bangkok every year for a 10-day-long 3000 flight hours in the Beechcrafts and training to renew their licenses.

Buddha Air has been classified as a very safe operator and we have provided the ATR-72 on lease purchase option. This is a very rare opportunity given only to highly rated operators who have structured and periodic audit, engineering and operations management monitored by us.

n Mr. Jean-Luc Establie Sales Director, ATR Company ge

p a 11 safety measures

uddha Air places its highest Bpriority on the safety of its flights and that’s the reason why we have no record of aviation insurance claim since the airline was launched in 1997. To keep the flights safe, our engineers inspect each aircraft thoroughly everyday as per the Standard Operating Procedure, Nepalese Civil Airworthiness Requirement and the Aircraft Operators Maintenance Manuals.

Buddha Air is the only private flight operator in Nepal to install the Aircraft Data Acquisition System (ADAS) device in all its aircrafts in addition to the Cockpit Voice Recorder (CVR) and the Flight Data Recorder (FDR). ADAS provides an early warning if the aircraft is in danger. The FDR records conditions of the flight. The device records each and every action conducted in the aircraft. The data are also sent to the Pratt and Whitney, Canada for analyses. We have a good storage of spare parts and our well-trained technicians conduct the maintenance work. ge p a 12 As flight safety is our top priority, pilots and engineers are frequently sent abroad for refreshertraining ge

p a 13 A proposed design of Buddha Air Hangar

n yet another significant move, view of aircraft safety. The shifting of hanGaR IBuddha Air is constructing its the operation department within the own hangar within the premises of area will enhance better coordination Tribhuvan International Airport, among the departments. Now all the which covers over 25,000 sq ft, will maintenance works will be done during be constructed with the state-of-art night time. This will increase the technology. The closed door hangar, utilization of each aircraft by 15 days which is of international standard, every year. In total, the hangar will is very important from the point of enhance the utilization of Buddha Air's aircrafts by more than 100 days. The total construction cost of the hangar is Rs 10 million.

Hangar will increase the utilizationof each aircraftby 15 days every year ge p a 14 international fligHts

t is a great leap forward. Banaras, Guwahati, Dehradun IBuddha Air is poised to and Delhi by the end of 2011. launch flights from Nepal to Commercial flights to Indian seven Indian cities and Paro cities are likely to begin from of Bhutan. Under the first September and to Bhutan from phase of our program, we will August-end. The international operate to four international flights are sure to bring in destinations including Paro of more tourists to Nepal and Bhutan and Lucknow, Kolkatta, greatly contribute to turn the and Patna of India by 2010. Visit Nepal 2011 into a grand Under the second phase, we will success. begin flights to Indian cities of human resource

uddha Air is one of the top employers in the resources with equal opportunities and without Bcountry with more than 550 staff members. nepotism. It ensures their regular attendance, works So the primary objective of the Human Resource for capacity development, and motivates them to Department (HRD) is to plan and manage human work hard for the betterment of the organization.

Staff Strength S. BAND Department/Division Total No. Executive Manager Officer Supporting Attendant Finance - 3 2 8 - 13 1 Revenue - 4 5 11 - 20 2 MIS - 3 1 8 - 12 3 HRD - 1 4 4 10 19 Technical 4 12 11 31 - 58 4 Engineering Corporate 1 - 2 4 23 30 Stores & purchase 1 1 2 3 1 8 Air Crew 3 18 22 - - 43 5 Operations Cabin Crew - 1 2 28 - 31 Flight Operation 1 1 4 9 3 18 Corporate - 1 5 1 - 7 Airport - 2 5 30 34 71 Cargo & PR - - 1 10 7 18 City Sales - 1 4 6 1 12 Sundhara - - 3 1 4 Jawalakhel - - 1 3 - 4 Reservations - 1 3 14 - 18 Biratnagar - 1 1 11 11 24 6 Marketing Pokhara - 1 2 3 7 13 Bhairahawa - 1 2 2 7 12 Nepalgunj - - 1 4 5 10 Bhadrapur - 1 1 4 7 13 Janakpur - - 1 4 5 10 Simara - - 1 4 5 10 Bharatpur - - 1 3 4 8 Dhangadhi - - 1 3 4 8 G.S.D - - 3 1 5 9 General 7 Transport - - 1 3 39 43 Service Catering - - 1 3 4 Total >> 10 53 89 216 182 550 ge p a 16 In 2004, Buddha Air introduced Staff Performance Management System (SPMS) to manage human resources in a productive manner. We also send our management level staff members to Kathmandu University (KU) for professional and academic courses to enhance their working performances. Currently nine of our employees are receiving 14-week Diploma in Management (DipM) courses. The department is also planning to set up a separate unit to continuously monitor the performance of the employees.

Primary objective of theH umanR esource Department( HRD)is to plan and manage humanresources with equal opportunities andwithout nepotism finance & Revenue

he Finance Department at Buddha Since its inception in 1997, Buddha Air TAir has come a long way developing has enjoyed a healthy net profit. and implementing financial policies, strategies, plans and programs, preparing Buddha Air’s professional and transparent annual budgets, monitoring, analyzing and financial system enabled it to receive reporting financial status and information. loan from the International Finance We have a separate department to collect Corporation, a wing of the World Bank revenues. Group, for the purchase of two ATR 42- 320 aircrafts. Starting with an initial investment of around USD eight million which the company paid off in six years, Buddha REVENUE COMPARISON Air today is worth over USD 10 million. Period from 1997/98 to 2009/10

2000000000

1600000000

Details of Direct & Indirect Tax 1200000000 Period from 2005/06 to 2009/10

800000000 147,193,838

400000000

107,737,953 0 95,674,197 Indirect Tax 97-98 98-99 99-00 00/01 01/02 02/03 03/04 04/05 05/06 06/07 07/08 08/09 09/10 79,555,268 (CUSTOM, VAT & TDS)

direct Tax (CORP.)

48,898,108 40,484,484 31,210,868 26,342,963 7,936,608

05/06 06/07 07/08 08/09 09/09 (provisional) ge p a 18 Management information system (MIS)

uddha Air has developed its It is not an easy task given the status BManagement Information of information technology in our System (MIS) for collecting, country and the requirement of organizing, analyzing investment and above all the and disseminating lack of qualified manpower. information for Overcoming these the planning of its hurdles, Buddha business operations. The Air’s MIS has been whole effort of the MIS is successful in creating a concentrated on achieving the very sound and transparent goals set by the management. system.

Buddha Initiatives

uddha Air is very Bconcerned about its corporate social responsibility (CSR) and has been conducting donate over Rs 1.5 million various programs for the to Dangihat VDC of Morang welfare of local communities district every year for health for the last few years. An and education from 2010. On approach for CSR that is April 24, a 40-member medical becoming more widely team, financed by Buddha accepted is community- air, conducted a one-day based development in which health camp in the VDC and corporations work with distributed medicines. Some local communities to better 1,200 locals benefitted from the themselves. In its new program, health camp, which cost over Buddha Air has decided to five hundred thousand rupees. everest experience

uddha Air offers you the best mountain sight-seeing flight gives you the joys of Bflight service of the world. Within flying past nine majestic peaks of the world minutes you take off from Kathmandu and that will be the joy to be cherished Airport, the snow-clad Himalayas, which forever. Having flown around 400,000 the locals regard as the sacred abodes of passengers to the Himalayas for the last gods, are just outside your window. Wait 12 years, we can safely say we operate the a few minutes more and you will see Mt. best mountain flight in the world. Flights Everest, the highest peak of the world. so satisfying that one of our passengers Flying at the altitudes of approximately commented: “I did not climb Mt Everest but 7,500 to 8,500 meters, passengers get close- I touched it with my heart.” up views of the Himalayas. Our Everest Touch Mt Everest with your heart

UNION

For the first time since its inception, Buddha Airline has now an elected body of the Independent Workers’ Union. The management has regarded the union as an integral part of the airline and congratulated the newly elected union body. The union actively bargained with the management while taking the recent decision to hike the salary of the employees by 25 to 30 percent.

union officials

President : Ram Prasad Bhusal Senior Vice-President : Babita Manandhar Vice-President : Chhapanna Lal Rajbhansi General Secretary : Prakash Kayastha Secretary : Kamal Raj Lamichhane Treasurer : Ramesh Prasad Ghimire

Members Binita Thapa Baital Bhagat Tharu Saroj Dutta Pandey Bhakta Bahadur Basnet Dipesh K.C Pankaj K.C Ranjana Bhandari ge p a 22

Buddha Air Head Office: P.O.Box 2167. Kathmandu, Nepal, Telephone: 977-1-5521015 Fax: 977-1-5537726 Email: [email protected]

City Sales Office Hattisar Telephone: 977-1-4437025, 4437677 Fax: 977-1-4436033