Aeroflot Group
UBS Emerging EMEA Corporate Day (Singapore) 9 February 2015 Disclaimer
232 Chart Colours 235 240 This document has been prepared by JSC “Aeroflot” (the “Company”). By attending the meeting where the presentation is made, or by reading the 182 presentation slides, you agree to the following. 196 204 This document does not constitute or form part of any advertisement of securities, any offer or invitation to sell or issue or any solicitation of any offer to purchase or subscribe for, any securities of the Company in any jurisdiction, nor shall it or any part of it nor the fact of its presentation or distribution form 135 157 the basis of, or be relied on in connection with, any contract or investment decision. 179 No reliance may be placed for any purpose whatsoever on the information contained in this document or on assumptions made as to its completeness. 0 No representation or warranty, express or implied, is given by the Company, its subsidiaries or any of their respective advisers, officers, employees or 112 agents, as to the accuracy of the information or opinions or for any loss howsoever arising, directly or indirectly, from any use of this presentation or its 192 contents.
59 This document may include forward-looking statements. These forward-looking statements include matters that are not historical facts or statements 100 regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial 135 condition, liquidity, prospects, growth, strategies, and the market in which the Company operates. By their nature, forwarding-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. The Company cautions you 0 that forward-looking statements are not guarantees of future performance and that the Company’s actual results of operations, financial condition and 176 80 liquidity and the development of the market in which the Company operates may differ materially from those made in or suggested by the forward- looking statements contained in this document. The Company does not undertake any obligation to review or confirm expectations or estimates or to 22 update any forward-looking statements to reflect events that occur or circumstances that arise after the date of this presentation. 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 2 Table line colour 178 178 178 232 Chart Colours 235 240
182 1. Market Update 196 204 2. Monthly Traffic Statistics 135 157 179 3. Operating Performance 0 112 192 4. Fleet Overview
59 100 135 5. Financial Performance
0 176 6. Capital Structure and Liquidity 80
22 7. Appendix 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 3 Table line colour 178 178 178 Russian Air Transportation Market
232 Chart Colours 235 240 2009 – 2013 Q3 2014/2013 9M 2014/2013
International Routes 9.6% 182 Domestic Routes 103.7 196 91.6 204 CAGR 87.7 80.1 2008-13 2014-17F 80.0 Russian Total 70.5 9.9% Passenger 64.4 12.8% 6.6% 135 56.7 56.2 4.0% Traffic 47.3 52.3 157 41.2 37.5 50.3 179 34.1 1,2 32.8 3.2% (m PAX) 8.4% 5.3% 21.6 22.3 19.1% 35.4 39.2 35.4 0 23.8 29.2 32.7 22.9% 29.8 12.5 15.3 112 192 50 2009 2010 2011 2012 2013 Q3 2013 Q3 2014 9M 2013 9M 2014 45 59 40 10.5% 100 135 35 31.3 30 27.5 26.5 Aeroflot Group CAGR 24.0 25 10.1% 0 Passenger 17.4 2008-2013 176 20 16.4 16.0 13.3 (1.2%) Traffic 14.1 13.4 80 15 11.1 21.4% 10.9 9.9 (2.8%) (m PAX) 10 7.9 9.4 6.2 13.9 5.5 5.3 25.4% 22 5 11.5 22.7% 26.4% 10.6 13.2 4.9 6.2 7.0 4.4 5.5 44 0 66 2009 2010 2011 2012 2013 Q3 2013 Q3 2014 9M 2013 9M 2014
1 Aeroflot Overall Market 19.6% 20.0% 20.5% 30.0% 30.2% 28.9% 29.0% 30.0% 30.2% 40 Share2 120 International2 18.9% 19.2% 19.9% 28.5% 27.0% 25.4% 24.0% 26.7% 25.4% 2 35.1% 36.1% 35.5% 37.4% 0 Domestic 20.6% 21.2% 21.4% 32.5% 35.5% Message text 128 0 • Russia remains high-growth air transportation market due to low penetration of air transportation services • Domestic segment continues to deliver strong double-digit growth 255 Highlight 0 0 Source: TCH, Company estimates 1 Incl. foreign carriers’ traffic 4 2 Market based on passenger traffic of both domestic and foreign carriers 178 Table line colour 3 In the charts, tables and text of this presentation, immaterial deviations in calculation of % change, subtotals and totals are due to rounding 178 178 Aeroflot Group Market Position
232 Chart Colours 235 1 240 Passenger Traffic (9M 2014, m PAX) Russian Passenger Traffic
182 30.2%1 196 2 204 36.3% 26.5 135 157 179 19.0% 20.0% 19.0% 20.0% 19.0% 18.0% 16.9%
1 0 18.9% 2 112 16.9%1 22.8% 18.0% 18.9% 192 18.0% 24.0% 22.0% n/a 16.6 28.0% 25.0% 59 11.9%1 14.9 100 2 135 14.3% 1 8.8% 8.6%1 10.5 2 0 10.6% 10.4%2 176 1 7.7 7.6 4.6% 63.0% 64.0% 64.1% 80 58.0% 5.6%2 53.0% 56.0% 55.0% 22 4.1 44 66
1 40 Aeroflot Transaero S7 Utair Ural Foreign Other 2008 2009 2010 2011 2012 2013 9M 2014 120 Group Group Group Airlines Carries Top 5 Carriers Other Russian Carriers Foreign Carriers
0 Market Share Message text 128 0 • Continuing growth of market share of the top-5 leading domestic players led by Aeroflot • Aeroflot market share exceeds combined market share of three nearest competitors 255 Highlight 0 0 Source: TCH, Rosaviatsia, Company estimates 1 Based on passenger traffic of both domestic and foreign carriers 5 2 Based on passenger traffic of domestic carriers only Table line colour 178 178 178 Multi-brand Offering of Aeroflot Group
232 Chart Colours 235 1 240 Brand Business model Focus Airport PAX Contribution • Flagship carrier • Moscow (Sheremetyevo) 182 • Premium product 67.2% 196 Network/ 204 Scheduled • High income, middle class, leisure segment 135 157 • Focus on direct and transit routes via • Saint-Petersburg 15.0% 179 St. Petersburg hub (Pulkovo) 0 • Middle class segment 112 5.1% 192 • Short- and mid-haul direct domestic • Rostov-on-Don, Regional routes in the South of Russia Krasnodar, Sochi, 59 • Middle class segment Mineralnye Vody 100 135 • The Far East airline flying on short- • Vladivostok, Khabarovsk, 3.0% and mid-haul direct international and Yuzhno-Sakhalinsk 0 domestic routes 176 80 • Middle class segment • Predominantly charter operations 9.4% 22 • Orenburg, Domodedovo 44 Charter • Leisure segment (Moscow) 66 • Strategic positioning currently under review 1 40 • Short and mid-haul • Vnukovo (Moscow) • Ticket sales started on 120 • Point-to-point budget passenger 11 Nov. 2014 Low Cost carrier • First flight performed on 0 (Pobeda) 1 Dec. 2014 Message text 128 0 • Multi-brand offering to capture customers in every market segment 255 • Wide geographic coverage of the Russian market Highlight 0 0 Source: Company data Note: PAX contribution as of 9M 2014, Dobrolet contribution is 0.3% 6 Table line colour 178 178 178 Aeroflot’s New Low Cost Carrier ‒ Pobeda
232 Chart Colours 235 240 Overview of Pobeda LCC Penetration Comparison by PAX (%)
38% 182 • Oct. 2013: launched under Dobrolet name 196 – 67.8 ths PAX carried by August 2014 30% 204 – Flights suspended in August 2014 due to EU sanctions 27% after 55 days of operations • Sep. 2014: new legal entity launched to run LCC business 17% 135 Status 157 • Oct. 2014: official press release on launch of the LCC carrier 179 under “Pobeda” brand 9% • Nov. 2014: n.m.1 0 – Ticket sales commenced on 11 November 2014 112 – First flight performed on 1 December 2014 192 Europe North South Asia Africa Russia America America
59 • A typical LCC offering to attract price sensitive customers 100 • Substantially different from Aeroflot’s product proposition: 9 Scheduled Destinations in 2014 135 – Food and drinks are not included in ticket price – Extra fees for non-carry on baggage Business – 20-40% discount compared to fares of “traditional” 0 model carriers 176 Surgut Network Regional 80 – Majority of tickets are non-refundable 7 • Sales of tickets via direct or online channels Perm Operating base VKO (Moscow) Moscow Ekaterinburg • Operating from Vnukovo thus reducing cannibalization risks 7 14 7 Tumen 22 Kazan 7 44 Chelyabinsk Destinations 9 (+2 seasonal destinations) 7 Samara 66 Belgorod • c. 10m passengers Volgograd Avg. Frequency / 7 7 7 flights per week 2018 • Expanding to 37 aircraft Destination 1 Targets • Expanding to 47 routes 8 Boeing 737-800 NG Fleet 40 • Expansion to CIS and international markets 7 Vladikavkaz (189 seats per plane) 120
# - frequency per week for 2014 0 Message text 128 • Pobeda will allow Aeroflot to develop more aggressively the price sensitive segment, attracting customers that currently either 0 don’t travel often or travel by other means of transportation
255 • Swift action by the management allowed the Group to restart the project with its original scope and focus in 4 months Highlight 0 0 Source: Company data 1 No LCC carrier is operating in the domestic Russian market currently, EasyJet and WizzAir are operating on a small number of international routes with negligible market share 7 Table line colour 178 178 178 232 Chart Colours 235 240
182 1. Market Update 196 204 2. Monthly Traffic Statistics 135 157 179 3. Operating Performance 0 112 192 4. Fleet Overview
59 100 135 5. Financial Performance
0 176 6. Capital Structure and Liquidity 80
22 7. Appendix 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 8 Table line colour 178 178 178 12M 2014 Traffic and Capacity Evolution
232 Chart Colours 235 240 Monthly Passenger Traffic (m PAX) Monthly Passenger Turnover (bn pkm) 12M 2014: +10.7% Y-o-Y 12M 2014: +5.6% Y-o-Y 182 December 2014: +16.0% Y-o-Y December 2014: +7.6% Y-o-Y 196 7.6% 9.2% 9.6%
204 11.9% 6.7%
9.2% 6.3%
9.5%
9.8
9.8 4.2%
3.8
3.8 5.9%
8.0%
9.1
135 9.5% 4.3%
3.6%
3.5 9.9%
8.9
16.0%
8.6 8.6
7.6% 3.4
0.3% 3.3
10.7% 10.2% 3.4 4.2%
8.0
157
8.1
11.6% 4.3%
3.1
3.0
7.6
14.6%
2.9
7.3
7.3
2.9
179
2.7
2.7
6.9
6.7
6.6
6.6
2.6
2.6
6.5
2.5
6.4
2.5
6.3
6.5
6.2
6.4
2.4
2.3
2.3
2.3
5.9
2.2 5.6
2.2
5.4 2.0
0 1.9 112 192
59 100 135 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Monthly ASK (bn ask) Monthly Seat Load Factor (%) 0 12M 2014: +6.2% Y-o-Y 176 12M 2014: LF 77.8%, decrease of 0.4 p.p. 80 December 2014: +10.3% Y-o-Y December 2014: LF 71.0%, decrease of 1.8 p.p. 6.4% 6.4% 7.8%
4.3% 3.9%
4.5%
22 9.8% 10.3% 2.5
1.7%
5.4% 5.7% 1.0
11.3 10.7 11.3
44 10.6
10.6 1.5
10.6
1.5
9.0% 10.2
9.9 9.8
9.8 (0.8)
9.5
66 9.5
9.4 9.2 (4.0)
8.8 0.2
8.6
8.5
8.5 8.4
1.1 8.4
8.3 (3.3) 8.1 7.8 (0.8) 86.6% 86.7% (3.8) 1 7.1 (1.8) 40 81.2% 80.9% 120 77.6% 77.4% 74.6% 74.4% 71.8% 72.7% 71.0% 0 72.4% Message text 128 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Load factor in respective 255 2013 2014 % Y-o-Y increase 2013 2014 p.p. Change in SLF % Highlight 0 period of 2014 0 • Strong PAX growth rate • Moderate growth of ASK and RPK impacted by restructuring of fleet at subsidiaries level 9 Table line colour 178 • Load factor of 77.8% during 12M supported by healthy demand for air transportation services 178 178 Operating Data – December & 12M 2014
232 Chart Colours 235 240 JSC Aeroflot Aeroflot Group December December 12M 12M December December 12M 12M Y-o-Y Y-o-Y Y-o-Y Y-o-Y 182 Indicator Unit 2013 2014 2013 2014 2013 2014 2013 2014 196 Passenger Turnover m pkm 4,689 5,260 12.2% 60,226 67,122 11.4% 6,253 6,727 7.6% 85,273 90,075 5.6% 204 International Routes 3,091 3,352 8.4% 40,614 42,677 5.1% 4,052 3,834 (5.4%) 56,113 55,107 (1.8%)
135 Domestic Routes 1,599 1,909 19.4% 19,612 24,445 24.6% 2,201 2,894 31.5% 29,161 34,968 19.9% 157 Passenger Capacity m ASK 6,391 7,286 14.0% 76,445 85,822 12.3% 8,591 9,474 10.3% 109,064 115,834 6.2% 179 International Routes 4,353 4,856 11.5% 52,392 56,207 7.3% 5,600 5,599 (0.0%) 71,530 72,219 1.0% 0 Domestic Routes 2,038 2,430 19.3% 24,052 29,615 23.1% 2,990 3,875 29.6% 37,534 43,615 16.2% 112 Tonne-Kilometres m tkm 489 539 10.2% 6,340 6,723 6.0% 634 676 6.6% 8,666 8,831 1.9% 192 International Routes 319 340 6.6% 4,307 4,237 (1.6%) 406 384 (5.5%) 5,711 5,362 (6.1%) 59 Domestic Routes 170 199 16.9% 2,033 2,486 22.3% 228 292 28.1% 2,955 3,468 17.4% 100 Passenger Traffic th PAX 1,630 1,866 14.5% 20,902 23,610 13.0% 2,316 2,686 16.0% 31,391 34,735 10.7% 135 International Routes 913 980 7.3% 12,295 12,468 1.4% 1,210 1,187 (1.9%) 17,391 17,096 (1.7%) 0 Domestic Routes 717 886 23.5% 8,608 11,142 29.4% 1,106 1,499 35.5% 13,999 17,640 26.0% 176 Cargo and Mail Carried tonnes 14,807 14,446 (2.4%) 176,456 145,285 (17.7%) 16,978 16,665 (1.8%) 204,554 166,262 (18.7%) 80 International Routes 8,762 8,016 (8.5%) 117,968 81,515 (30.9%) 9,117 8,232 (9.7%) 121,797 84,281 (30.8%) 22 Domestic Routes 6,045 6,431 6.4% 58,488 63,770 9.0% 7,861 8,432 7.3% 82,757 81,981 (0.9%) 44 Seat Load Factor % 73.4% 72.2% (1.2)p.p. 66 78.8% 78.2% (0.6)p.p. 72.8% 71.0% (1.8)p.p. 78.2% 77.8% (0.4)p.p. International Routes 71.0% 69.0% (2.0)p.p. 77.5% 75.9% (1.6)p.p. 72.3% 68.5% (3.8)p.p. 78.4% 76.3% (2.1)p.p. 1 Domestic Routes 78.5% 78.5% (0.0)p.p. 81.5% 82.5% 1.0p.p. 73.6% 74.7% 1.1p.p. 77.7% 80.2% 2.5p.p. 40 120 Flight Hours hours 42,717 47,396 11.0% 509,058 554,659 9.0% 61,701 67,501 9.4% 776,258 815,377 5.0% Domestic market: 0 Message text 128 • Strong double-digit growth on domestic market throughout the year 0 • Decent seat-load factor dynamics due to stronger demand
255 International market: Highlight 0 • Stronger performance of JSC Aeroflot compared to Aeroflot Group 0 • Lower seat-load factor due to softer demand for international travelling 10 Table line colour 178 178 178 232 Chart Colours 235 240
182 1. Market Update 196 204 2. Monthly Traffic Statistics 135 157 179 3. Operating Performance 0 112 192 4. Fleet Overview
59 100 135 5. Financial Performance
0 176 6. Capital Structure and Liquidity 80
22 7. Appendix 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 11 Table line colour 178 178 178 Aeroflot Group Network
232 Chart Colours 235 1 240 # of Flights Evolution by Region Geographic Network – Summer 2014 Schedule
(9M 2014 / 9M 2013) Murmansk 182 Arkhangelsk Novy Urengoy Russia 18.6% Yakutsk 196 Syktyvkar Surgut Nizhnevartovsk Magadan Saint-Petersburg Chelyabinsk Ekaterinburg Novokuznetsk 204 Tumen Tomsk Perm Krasnoyarsk Europe 5.8% Moscow Novosibirsk Ulan-Ude Kaliningrad Kazan Ufa Omsk Kemerovo Chita Samara Pavlodar Barnaul Irkutsk Okha Petropavlovsk- Hannover Kharkov Abakan Kamchatski Orenburg Astana Karaganda Blagoveshchensk Düsseldorf Kiev Ust-Kamenogorsk Shakhtyorsk Volgograd Orsk Magnitogorsk Khabarovsk 135 Krasnodar Rostov-on-Don Yuzhno-Sakhalinsk Asia (11.3%) Toronto Astrakhan Tashkent Harbin Anapa Almaty Ürümqi Ulan Bator Mineralnye Vody Bishkek Vladivostok 157 New York Gelendzhik Sochi Navoi Namangan Fergana Erevan Baku Osch Beijing Khujand Dalian 179 North and Washington Damascus Teheran Kulyab Seoul Dushanbe Weihai 2.8% Los Angeles Rhodos Beirut Tokyo Tel Aviv Urgench Samarkand Central America Cairo Qarshi Shanghai Buhara 0 Miami Dubai Delhi Guangzhou CIS 0.8% Havana Hanoi Hong Kong Punta Cana Aeroflot routes 112 Bangkok 192 Middle East Rossiya Airlines routes 8.0% Ho Chi Min Donavia routes Male and Africa Aurora routes 59 Total 10.7% 100 Helsinki 135 Stockholm Saint Petersburg Oslo • Asia decrease resulted from fleet optimization and route network Tallin restructuring in the subsidiary airline (Aurora) Riga Moscow Nizhni Novgorod 0 Copenhagen Kazan 2 Kaliningrad 176 Average Flight Frequency per Route Hamburg Vilnius Nizhnekamsk Minsk Amsterdam 80 Berlin Warsaw Samara Hannover (9M 2014 / 9M 2013) Düsseldorf London Dresden Brussels Frankfurt Kiev Karlovy Vary Prague 10.0% (80.7%) 6.9% 11.2% 10.6% 1.8% Munich Dnepropetrovsk 22 Paris Stuttgart Salzburg Volgograd Innsbruck Donetsk Zurich Vienna Budapest Rostov-on-Don 44 Ljubljana Odessa 11.1 Geneva Milan 10.0 Zagreb Bucharest Simferopol 9.6 10.0 Pula Krasnodar Venice Belgrade Stavropol 66 8.8 9.1 BolognaSplit Anapa 8.2 Sochi Mineralnye Vody 7.7 Rimini Varna Gelendzhik Dubrovnik Tivat 6.1 6.2 Sofia Burgas Barcelona Rome Istanbul Gyumri Madrid Thessaloniki Erevan 1 Baku Athens 40 2.7 Antalya Malaga 120 Larnaca 0.5 Heraklion Tenerife Tel Aviv Las Palmas 0 Scheduled Charter International Domestic Medium-hual Long-haul Message text 128 Scheduled Scheduled Scheduled Scheduled 0 • Moderate growth of destinations, limited increase in frequencies on scheduled routes, continuing downscale of charter operations 255 • In winter 2014 season (26-Oct-2014 to 28-Mar-2015), Aeroflot Group is operating flights to 137 unique destinations in 53 countries Highlight 0 0 • New destinations in Russia (Murmansk, Arkhangelsk). CIS (Tbilisi, Chisinau), seasonal winter destination (Phuket) 12 1 Scheduled flights of Aeroflot Group; 2 JSC “Aeroflot” flights (scheduled and charter) and flights of subsidiaries under 100% commercial management Table line colour 178 178 178 Unique Positions to Capture Growing Traffic to / from Asia
232 Chart Colours 235 240 Traffic Growth to / from Asia Share of JSC Aeroflot Transit PAX in Sheremetyevo
182 Forecast Passenger Traffic Flows to/from Russia – CAGR 2013-2033E 196 39.2% 204 8.3% 7.8% 7.2% 35.5% 6.8% 6.5% 35.0% 6.1% 6.1% 5.8% 135 5.1% 32.6% 157 4.9% 179 30.0%
0 112 2011 2012 2013 9М 2013 9М 2014
192 US
CIS
China
Asia
South
Asia
Central Europe
Europe
America Western
59 Indian
Emerging Advnaced
100 East Middle 135 subcontinent
0 Favourable Geographic Position on Key Global Routes Flying Time Between European and Asian Destinations 176 80 Delhi Beijing Hong Kong Seoul Tokyo From Milan Direct 22 10.5h 11.5h 12.0h 44 Via Moscow 10.5h 12.0h 14.0h 13.0h 14.0h 66 Moscow Via Istanbul 10.0h -0.5h 13.0h +1.0h 13.5h -0.5h 14.0h +1.0h 15.5h +1.5h Via Dubai +2.5h +0.5h +1.5h +3.0h Dusseldorf 10.5h 14.5h 14.5h 14.5h 17.0h 1 From Paris 40 Beijing Direct 8.0h 10.0h 12.0h 11.0h 12.0h 120 New York Milan Via Moscow 11.0h 12.5h 14.5h 13.5h 14.5h Shanghai Via Istanbul 10.5h -0.5h 14.0h +1.5h 14.0h -0.5h 14.5h +1.0h 16.0h +1.5h 0 Via Dubai 11.0h 15.0h +2.5h 15.0h +0.5h 16.0h +2.5h 17.5h +3.0h Message text 128 Mumbai From Frankfurt 0 PAX (m) to / from Asia Direct 7.5h 9.5h 11.0h 10.5h 11.5h Via Moscow 10.5h 11.5h 14.0h 13.0h 14.0h 2.2 2.4 255 1.4 Via Istanbul 10.0h -0.5h 13.5h +2.0h 13.5h -0.5h 14.0h +1.0h 15.5h +1.5h Highlight 0 Via Dubai 10.5h 14.5h +3.0h 14.5h +0.5h 15.5h +2.5h 17.0h +3.0h 0 Shortest geographic distance for selected key routes 2011 2012 2013 13 Table line colour 178 Source: Company data, IMF, Eurostat, RITA, Russian State Statistics Service, Rosaviatsia, Airbus Global Market Forecast 2014-2033 178 178 9M 2014 Traffic and Capacity Dynamics (Y-o-Y)
232 Chart Colours 235 240 North and Central America Russia CIS
182 4.5% 0.1% 25.3% 196 3.4% 3.8% 204 18.6% 14.1% 135 3.1% 157 179 (0.3%) Passengers RPK ASK SLF (8.8%) (8.6%) (8.7%) Passengers RPK ASK SLF carried Passengers RPK ASK SLF 0 carried carried 112 192 Europe Middle East Asia 59 100 135 7.4% 7.2% 10.4% 5.9% 6.3% 8.1% 0 3.7% 176 3.1% 80 0.4%
22 (0.7%) 44 (1.6%) 66 Passengers RPK ASK SLF (2.7%) carried Passengers RPK ASK SLF Passengers RPK ASK SLF carried 1 carried 40 120 • Russian market – the star performer in 9M 2014 0 • Performance on North American and European markets benefited from softening competitive pressure Message text 128 0 • CIS region operating metrics deteriorated due to lower frequency of flights to Ukraine • Middle Eastern market performance affected by capacity restructuring on flights to Turkey and increased capacity on flights to Israel 255 • Asian operating results are affected by increased capacity on the routes to South Asia Highlight 0 0 14 Table line colour 178 Source: Data presented based on management accounting for scheduled flights of Aeroflot Group (excluding charter flights) 178 178 Revenue Breakdown
232 Chart Colours 235 1 240 Traffic Revenue Breakdown by Type Revenue from Scheduled Passengers (RUBm)
9M 2014 Charter 182 Passenger Q3 2013 Q3 2014 Y-o-Y 9M 2013 9M 2014 Y-o-Y 196 204 Flights 6% Cargo 3% Russia 31,888 35,798 12.3% 69,238 78,764 13.8% 135 157 Scheduled 179 Passenger Flights Europe 20,709 20,246 (2.2)% 49,124 51,101 4.0% 91% 0 112 192 Asia 9,160 9,869 7.7% 23,330 25,247 8.2% 59 100 135 Scheduled Traffic Revenue Breakdown by Region CIS 6,212 3,861 (37.8%) 14,260 11,220 (21.3%) 9M 2014 0 176 Other North and 80 11% Central 4,547 4,463 (1.9%) 11,127 12,127 9.0% North America America 22 and Central 44 7% 66 Middle East Russia 42% 4,565 3,775 (17.3%) 10,454 10,375 (0.8%) and Africa 1 Asia 13% 40 120 Total 77,081 78,011 1.2% 177,534 188,834 6.4% Europe 27% 0 Message text 128 0 • In 9M 2014 revenue from scheduled passengers grew by 6.4% on the back of the increase in revenue from Russian, American and Asian markets 255 Highlight 0 • Negative contribution of CIS market is attributable to reduced number and frequency of flights to Ukraine 0 15
Table line colour 178 1 Data presented based on management accounting 178 178 Revenue Units For Scheduled Flights
232 Chart Colours 235 240 Traffic Yield: PAX Revenue / RPK (RUB / RPK) Traffic RASK: PAX Revenue / ASK (RUB / ASK)
182 Q3 2014 9M 2014 Q3 2014 9M 2014 196 (8.3%) (2.5)% (3.3%) (6.7%) 204 3.35 2.79 3.07 3.09 2.99 2.60 135 2.42 157 2.36 179
0 112 192
9M 2013 9M 2014 Q3 2013 Q3 2014 9M 2013 9M 2014 59 Q3 2013 Q3 2014 100 1 1 135 Yield PAX Revenue / RPK (RUB / RPK) RASK PAX Revenue / ASK (RUB / ASK) Q3 2014 9M 2014 Q3 2014 9M 2014 0 (1.9%) 176 (10.6%) (2.8%) (4.1%) (4.0%) 80 (6.6%) (0.3%) (10.0%) 2.88 2.73 2.82 3.07 2.98 3.12 2.99 22 3.42 2.44 2.39 2.46 2.45 3.30 3.19 2.29 44 2.97 66
1 40 120
0 International Domestic International Domestic International Domestic International Domestic Message text 128 0
255 • International and domestic yields during Q3 and 9M 2014 have been affected by weaker consumer confidence Highlight 0 • Moreover, competitors added significant capacity which was not met by market demand 0 16 Table line colour 178 178 1 Data presented based on management accounting 178 232 Chart Colours 235 240
182 1. Market Update 196 204 2. Monthly Traffic Statistics 135 157 179 3. Operating Performance 0 112 192 4. Fleet Overview
59 100 135 5. Financial Performance
0 176 6. Capital Structure and Liquidity 80
22 7. Appendix 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 17 Table line colour 178 178 178 Aeroflot Group Fleet Overwiew
232 Chart Colours 235 1 240 Aeroflot Group Fleet in operation JSC Aeroflot Operates the Youngest Fleet in the Industry
4.0 182 Fleet Average Age 196 Etihad Airways 5.4 204 10.4 Qatar Airways 5.4 8.8 easyJet 5.7 135 7.7 China Eastern Airlines 5.9 157 7.2 179 Air China 5.9 239 China Southern Airlines 6.0 209 222 232 0 Ryanair 6.0 112 Turkish Airlines (THY) 6.3 192 Emirates Airline 6.3 Cathay Pacific 8.0 59 2011 2012 2013 9M 2014 100 Japan Airlines 8.5 135 Qantas 8.7 1 JSC Aeroflot Fleet in operation ANA - All Nippon Airways 9.1 0 Air France 10.6 176 80 Fleet Average Age KLM Royal Dutch Airlines 10.6 Lufthansa 11.2 5.3 5.2 5.2 22 US Airways 11.3 44 Southwest Airlines 11.4 66 4.0 British Airways 12.6 American Airlines 13.1 1 40 140 144 United Airlines 13.4 109 125 120 Transaero Airlines 15.8 Delta Air Lines 17.0 0 Average Fleet Age of Selected Airlines with Active Fleet of 100+ Message text 128 2011 2012 2013 9M 2014 0 Aircraft According to ACAS Statistics Excluding Aeroflot (as of Sep 2014)1
255 Highlight 0 • Aeroflot operates the youngest fleet in the Industry among airlines with active fleet of 100+ aircraft 0 1 Excludes planes out of operation 18 Table line colour 178 178 178 Aeroflot Group Fleet
232 Chart Colours 235 240
Financial Operating Total as of Total as of Change vs. 182 Type1 Aeroflot Subsidiaries Owned Lease Lease 30-Sep-2014 31-Dec-2013 31-Dec-2013 196 204 Boeing 767 - 3 - - 3 3 8 (5) Airbus A330 22 - - 8 14 22 22 -
135 157 Tu-204-300 ------6 (6)
179 haul - Boeing 777 10 3 - 10 3 13 7 6 2
0 Il-96-300 5 - 5 - - 5 6 (1) Long 112 2 192 MD-11F 3 - - - 3 3 3 - Total 40 6 5 18 23 46 52 (6)
59
100 l Airbus A319 7 32 - 13 26 39 39 - 135
hau Airbus A320 63 14 - 1 76 77 67 10 - Airbus A321 26 - - 21 5 26 26 - 0 176 Boeing 737 6 30 - 2 35 37 30 7 80 Medium Total 102 77 - 37 142 179 162 17
22 DHC 8 Series 200 - 3 - - 3 3 2 1 44
66 DHC 8 Series 300 - 4 - - 4 4 3 1 haul - An 148 - 6 - 6 - 6 6 - 1 SSJ 100 10 - - - 10 10 10 -
40 Short 120 Total 10 13 - 6 17 23 21 2
Total fleet3 0 152 96 5 61 182 248 235 13 Message text 128 0 • Continued renewal of fleet, replacing older aircraft with modern fuel-efficient aircraft • Disciplined approach to adding new capacity to the market 255 Highlight 0 0 19 1 As of 9M 2014 178 2 Aircraft not in operation – to be phased out in 2014 Table line colour 3 178 Excluding 4 Mi-8 helicopters and 1 An-24 aircraft 178 232 Chart Colours 235 240
182 1. Market Update 196 204 2. Monthly Traffic Statistics 135 157 179 3. Operating Performance 0 112 192 4. Fleet Overview
59 100 135 5. Financial Performance
0 176 6. Capital Structure and Liquidity 80
22 7. Appendix 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 20 Table line colour 178 178 178 Financial Highlights
232 Chart Colours 235 240
RUBm 182 (where applicable) Q3 2013 Q3 2014 Y-o-Y 9M 2013 9M 2014 Y-o-Y 196 204 Revenue 94,172 96,417 2.4% 222,353 236,698 6.5%
135 1 157 EBITDAR 29,842 23,523 (21.2%) 49,810 40,180 (19.3%) 179 EBITDAR1 margin 31.7% 24.4% (7.3)p.p. 22.4% 17.0% (5.4)p.p. 0 112 192 EBITDA 24,849 18,528 (25.4%) 35,764 23,559 (34.1%)
59 EBITDA margin 26.4% 19.2% (7.2)p.p. 16.1% 10.0% (6.1)p.p. 100 135 Net income 17,192 (1,658) n/a 17,237 (3,563) n/a 0 176 Net income margin 18.3% neg. margin n/a 7.8% neg. margin n/a 80
22 44 Net income adjusted for FX losses and NRE2 16,675 13,125 (20.9%) 20,284 12,907 (36.4%) 66
1 Adjusted net income margin 17.7% 13.6% (4.1) p.p. 9.1% 5.5% (3.7) p.p. 40 120 • Revenue growth driven by expanding passenger traffic and positive impact from currency devaluation offset by decreasing 0 yields Message text 128 • EBITDAR and EBITDA decline due to the impact of RUB depreciation and other non-recurring expenses 0 • Positive net income adjusted for currency losses and non recurring expenses 255 Highlight 0 0 1 EBITDAR = EBITDA + operating lease expenses; 21 2 Non-recurring expenses include provision on accounts receivable in relation to doubtful debtors of OrenAir (Ideal-tur and PGS), provision for pre-term return of MD-11, gain on pre-term Table line colour 178 return of TU-204 from Vladavia and increase of aircraft return reserves 178 178 Revenue Analysis
232 Chart Colours 235 240 6.5% 182 196 204 14,514 17,879 135 157 (15,229) * 179 (2,819) Net negative impact of RUB715m 0 112
192
59 100
135 RUBbn 236,698 222,353 0 176 80
22 44 66
1 9M 2013 Volume Currency Pricing Other 9M 2014 40 120
0 • Positive contribution of volume growth and Rouble devaluation to revenue growth was offset by softer tariff policy in the Message text 128 volatile macro environment coupled with increasing competition in the industry 0
255 Highlight 0 0 22 * Mainly due to growth of redeemable miles of Aeroflot Bonus program Table line colour 178 178 178 Cost Analysis
232 Chart Colours 235 240 Y-o-Y change, net Y-o-Y Change, 182 Y-o-Y of FX effect and Operating Expense Y-o-y net of FX effect 196 Q3 2013 Q3 2014 Change NRE (RUBm If not stated otherwise) 9M 2013 9M 2014 Change and NRE 204 22,418 24,502 9.3% 6.7% Fuel 59,360 64,738 9.1% 6.4% 135 157 179 50,065 56,869 13.6% 11.9% Opex (ex. Fuel) 136,123 158,298 16.3% 11.0%
0 112 15,367 17,647 14.8% 11.6% Aircraft, Traffic and Passenger Servicing 39,606 45,361 14.5% 10.5% 192
10,384 13,921 34.1% 34.1% Staff 31,741 38,225 20.4% 20.4% 59 100 135 4,993 4,994 0.0% (3.8%) Operating Lease 14,046 16,621 18.3% 8.7%
0 176 5,299 7,162 35.2% 18.6% Maintenance 13,974 16,430 17.6% 6.4% 80
5,104 5,329 4.4% 4.4% SG&A1 14,143 14,303 1.1% 1.1% 22 44 66 3,161 3,483 10.2% 10.2% D&A and custom duties 8,894 9,897 11.3% 11.3%
1 40 5,758 4,333 (24.7%) (15.0%) Other Expenses² 13,719 17,461 27.2% 7.9% 120
72,484 81,371 12.3% 10.3% Total Opex 195,483 223,036 14.1% 9.6% 0 Message text 128 0 • In 9M 2014 operating costs were impacted by non-recurring events and Rouble depreciation which mostly affected 255 operating lease expense, maintenance and aircraft, traffic and passenger servicing costs Highlight 0 0 1 Includes sales and marketing expenses and administration and general expenses 23 2 Non-recurring expenses include provision on accounts receivable in relation to doubtful debtors (Ideal-tur and PGS), provision for pre-term return of MD-11, gain on pre-term return of Table line colour 178 TU-204 and increase of aircraft return reserves 178 178 Group Unit Costs
232 Chart Colours 235 240 Cost per ASK (RUB) Q3 2013 Q3 2014 Y-o-y Operating Expense 9M 2013 9M 2014 Y-o-y 182 196 0.72 0.74 2.3% Fuel 0.72 0.74 3.2% 204 1.61 1.71 6.3% Opex (ex. Fuel) 1.65 1.81 10.0% 0.49 0.53 7.5% Aircraft, Traffic and Passenger Servicing 0.48 0.52 8.4% 135 0.33 0.42 25.5% Staff 0.38 0.44 14.0% 157 0.16 0.15 (6.4%) Operating Lease 0.17 0.19 12.0% 179 0.17 0.22 26.5% Maintenance 0.17 0.19 11.3% 0.16 0.16 (2.3%) SG&A 0.17 0.16 (4.3%) 0 112 0.10 0.10 3.1% D&A and custom duties 0.11 0.11 5.3% 192 0.19 0.13 (29.6%) Other Expenses 0.17 0.20 20.4% 2.33 2.45 5.1% Total Opex 2.37 2.55 8.0% 59 100 135 8.0% (3.0%)
0 0.01 0.02 4.7% 176 0.02 0.01 80 0.04 (0.01) 0.02 22 0.02 (0.08) 44 0.05 66 2.55 2.48 1 40 120 2.37 2.37
0 Message text 128 CASK 9M Staff Fuel Maintenance Air, Traffic Operating D&A and CD* Admin & Other Costs NRE** CASK 9M FX CASK 9M CASK 9M 0 2013 and PAX Lease Sales & (ex. NRE**) 2014 2014 ex. FX 2013 Marketing and NRE** 255 • Cost per ASK increased by 8.0% from RUB 2.37 in the 9M 2013 to RUB 2.55 in the 9M 2014 on the back of operating expenses Highlight 0 0 increase mainly due to negative FX effects * Customs duties 24 ** Non-recurring expenses include provision on accounts receivable in relation to doubtful debtors (Ideal-tur and PGS), provision for pre-term return of MD-11, gain on pre-term return of 178 Table line colour TU-204 and increase of aircraft return reserves. 178 178 Managing Fuel Costs
232 Chart Colours 235 240 Flight hours (th hours) Fuel Consumption per ASK (gr/ASK) Fuel Consumption per ATK (gr/ATK)
8.8% 182 (6.3%) (6.8%) 196 (5.1%) (5.9%) 204 413 380 288 270 278 7.8% 25 25 259 135 23 24 157 179 136 147
0 112 192 Q3 2013 Q3 2014 9M 2013 9M 2014 Q3 2013 Q3 2014 9M 2013 9M 2014 Q3 2013 Q3 2014 9M 2013 9M 2014
59 100 135 Average Monthly Fuel Price ($/ton) Comments
• Continuous fuel supply optimization 0 5-year supply contract at Sheremetyevo and 176 1000 963 949 80 938 943 1-year supply contracts in 29 regional airports 950 923 across Russia • Majority of fuel purchased in Russia (83%) 22 892 881 900 873 872 and almost all fuel at international airports 44 909 66 supplied at formula-linked price 850 878 877 867 869 854 Jet fuel price = NW Europe (FOB Rotterdam) 853 1 840 842 price x Discount x FX rate x 1.182 + 1 800 Storage/Fuelling/Supply fees (if any of these 40 applicable) 120 750 • Decreasing average fuel price. Jan Feb Mar Apr May Jun Jul Aug Sep Average fuel purchase price of $875/ton 0 2013 2014 Message text 128 (c.RUB30,960/ton3) in 9M 2014 vs $906/ton 0 (RUB28,700/ton4) in 9M 2013 (3.4% y-o-y decrease in USD terms) 255 • Aeroflot is achieving efficiency gains in fuel costs as new aircraft are put into operation, while old and less fuel-efficient ones Highlight 0 0 are in the process of phase out Notes: 1) USD/RUB exchange rate as per the Central Bank of Russia; 2) Assuming 18% VAT rate; 3) Based on average 9M 2014 exchange rate of 35.39 RUB/USD 4) Based on 25 average 9M 2013 exchange rate of 31.68 RUB/USD Table line colour 178 178 178 Headcount Overview and Labour Productivity
232 Chart Colours 235 240 Headcount 30-Sep-2013 31-Dec-2013 30-Sep-2014 Y-o-Y YTD Change 182 196 Aeroflot JSC 17,678 17,891 18,854 6.7 % 5.4 % 204 Aeromar 2,966 2,949 3,516 18.5 % 19.2 %
135 Subsidiary Airlines 9,432 9,366 9,495 0.7 % 1.4 % 157 179 Other 252 263 246 (2.4%) (6.5%)
0 Total 30,328 30,469 32,111 5.9 % 5.4 % 112 192
1 59 Airlines Labour Productivity 100 135 Traffic Revenue / Avg. Headcount RPK / Avg. Headcount PAX Traffic / Avg. Headcount (RUB ‘000 per employee) (m pkm per employee) (passengers per employee) 0 176 0.0% 80 0.5% 5.1% 7,028 7,029 22 2.32 2.33 44 853 896 66
1 40 120
0 Message text 128 9M 2013 9M 2014 9M 2013 9M 2014 9M 2013 9M 2014 0
255 • Sizeable improvement in labour productivity has resulted in increasing PAX traffic per employee Highlight 0 0 26 Table line colour 178 1 Based on Aeroflot JSC and subsidiary airlines average headcount. 178 178 Operating Income Evolution
232 Chart Colours 235 240 (RUBm)
182 17,879 196 204 14,514 (2,819) 135 157 (7,080) 179 (5,067) 0 (15,229) 112 (6,483) 192 (4,150) 1,654 (1,221) (1,003) 26,870 (891) (161) 59 (1,498) 100 Total revenue change 13,662 15,316 135 of 14,345m Total recurring expenses change of 27,552m
0
176 Staff
80 Fuel*
Other
Pricing
NRE***
Volume FX FX drag
22 FX benefit Other OPEX Other 44 Maintenance
66 CD** and D&A Operating Leases* Operating 1
40 PAX* and Traffic Aircraft,
Operating Income 9M 2013 Operating Income 9M 2014 Operating
120 Sales & & AdminMarketing
0 Message text 128 0 • Revenue growth driven by higher passenger volumes offset by softer fares and increased costs due to FX movement 2014 9M Income Operating Adjusted and non-recurring provisions 255 * Excluding currency impact Highlight 0 ** Custom Duties 0 *** Non-recurring expenses include provision on accounts receivable in relation to doubtful debtors (Ideal-tur and PGS), provision for pre-term return of MD-11, gain on pre-term return of TU-204 and increase of aircraft return reserves. 27 Table line colour 178 178 178 Adjusted Operating and Net Income Analysis
232 Chart Colours 235 240 9M Adjusted Operating Income Build-Up (RUBm)
182 885 164 2,132 196 204 (1,527)
135 157 15,316 179 13,662
0 112 Operating Income 9M 2014 Provision on accounts Provision for pre-term return Aircraft return reserves Gain on pre-term return of Adjusted Operating Income 192 receivable in relation to of MD-11 TU-204 9M 2014 doubtful debtors (Ideal-tur 59 and PGS) 100 135 9M Adjusted Net Income Build-Up (RUBm)
0 13,546 176 80
22 12,907 44 66 985 1,029 1 2,132 (3,563) (1,221) 40 120 Net Income 9M 2014 Provision on accounts Provision for pre-term Aircraft return reserves** Gain on pre-term return FX loss mainly related to Adjusted Net Income 9M 0 receivable in relation to return of MD-11* of TU-204 finance lease 2014 Message text 128 doubtful debtors (Ideal-tur 0 and PGS) • Aeroflot Group remained profitable on net income basis adjusted for FX fluctuations related to finance lease revaluation 255 and non-recurring provisions Highlight 0 0 * Including FX effect ** Including interest and FX effect 28
Table line colour 178 178 178 Group Net Income
232 Chart Colours 235 240 (RUBm)
182 196 204
135 157 179
0 112 17,237 192 16,470 12,907
59 100 135
(153) 0 (975) 233 (73) (3,563) 176 504 247 239 (27) 80 (3,558) 22 44 66 Aeroflot JSC Rossiya Vladivostok Donavia Orenair Aurora Sherotel Aeromar Others (incl. Group Net NRE* and Adjusted Group Net 1 Airlines Air minority) Income 9m Forex Group Net Income 9m 40 2014 Income 9m 2013** 120 Total net loss of subsidiary airlines of RUB 4,134m*** 2014
0 Message text 128 • Continuing restructuring of subsidiaries combined with non-recurring expenses contributed to negative reported net income 0 for the period
255 Highlight 0 0 * Non-recurring expenses include provision on accounts receivable in relation to doubtful debtors (Ideal-tur and PGS), provision for pre-term return of MD-11, gain on pre-term return of TU- 204 and increase of aircraft return reserves 29 ** Net income for 9M 2013 adjusted for non-recurring gain on disposal of Aerofirst (RUB 338m) Table line colour 178 *** Excluding Dobrolet 178 178 232 Chart Colours 235 240
182 1. Market Update 196 204 2. Monthly Traffic Statistics 135 157 179 3. Operating Performance 0 112 192 4. Fleet Overview
59 100 135 5. Financial Performance
0 176 6. Capital Structure and Liquidity 80
22 7. Appendix 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 30 Table line colour 178 178 178 Leverage and Liquidity
232 Chart Colours 235 240 Debt profile Net Debt / LTM EBITDA¹
182 RUBm 31-Dec-2013 30-Sep-2014 Change 196 4.7x 204 Borrowings 13,405 12,892 (3.8%)
135 Finance Lease Liabilities 72,036 108,655 50.8% 157 179 Pension Liabilities 707 715 1.1% 2.1x Customs Duties 436 235 (53.9%) 1.7x 0 112 Total Debt 86,584 122,497 41.5% 192 Cash and Short Term (18,933) (30,693) 62.1% 59 Investments 100 135 Net Debt 67,651 91,804 35.7% 30-Sep-2013 31-Dec-2013 30-Sep-2014
0 176 Debt breakdown by currency Finance Lease Repayment Schedule (RUBm)2 80 Borrowings Finance Lease 22 USD 44 RUB 3% 69,460 66 10%
1 40 120
0 11,942 12,161 11,790 Message text 128 3,302 0 RUB 90% USD 97% Q4 2014 2015 2016 2017 2018+ 255 Highlight 0 • Total Debt increased by of 42% mainly due to revaluation of finance lease obligations 0 • Cash position of RUB 30,693m and undrawn credit lines of RUB 26,480m 31
Table line colour 178 1 Net debt does not include capitalised operating lease expenses; 2 Future payments in dollars converted into roubles at exchange rate of 39.3866 RUB per USD 178 178 9M 2014 Operating Free Cash Flow
232 Chart Colours 235 240
182 196 204 4.5% 8,140
135 157 1,210 (4,716) 179 16,249 (345)
0 112 192 34,479 29,418 28,146 26,339 59 3,360 100 135 8,761
0 176 80 (3,241)
22 44 66 Profit Before D&A Interest Unrealized Net Other Adj. Cash Flows Working Net Cash Net Capital Net Pre- Free Cash Free Cash Income Tax Expense FX Loss Before From Capital Flows From Expenditures* delivery Flow 9M 2014 Flow 9M 2013 Working Operating Changes and Operating Payments for 1 Capital Activities Income Tax Activities Aircraft 40 Changes Before 120 Working Capital Changes 0 Message text 128 0
255 • Strong Operating and Free Cash Flow in 9M 2014 Highlight 0 0 * Purchases of property, plant and equipment and intangible assets + Purchases of investments and deposits placement - Proceeds from sale of property, plant and equipment - Proceeds from sale of investments and deposits return 32 Table line colour 178 178 178 232 Chart Colours 235 240
182 1. Market Update 196 204 2. Monthly Traffic Statistics 135 157 179 3. Operating Performance 0 112 192 4. Fleet Overview
59 100 135 5. Financial Performance
0 176 6. Capital Structure and Liquidity 80
22 7. Appendix 44 66
1 40 120
0 Message text 128 0
255 Highlight 0 0 33 Table line colour 178 178 178 Summary Financial Tables: Income Statement
232 Chart Colours 235 240
182 Q3 2013 Q3 2014 Y-o-Y 9M 2013 9M 2014 Y-o-Y 196 204 Traffic Revenue 84,222 86,346 2.5% 197,890 208,142 5.2% Other Revenue 9,950 10,071 1.2% 24,463 28,556 16.7% 135 157 Revenue 94,172 96,417 2.4% 222,353 236,698 6.5% 179 Operating Costs (58,473) (65,717) 12.4% (155,072) (174,726) 12.7% 0 Staff Costs (10,384) (13,921) 34.1% (31,741) (38,225) 20.4% 112 192 Depreciation and Amortisation (2,813) (3,175) 12.9% (7,865) (8,761) 11.4% (814) 1,442 n/a (805) (1,324) 64.5% 59 Other (Expenses)/Income, Net 100 Operating Costs (72,484) (81,371) 12.3% (195,483) (223,036) 14.1% 135
0 21,688 15,046 (30.6%) 26,870 13,662 (49.2%) 176 Operating Income 80 Finance Income 862 911 5.7% 2,321 1,684 (27.4%)
22 Finance Costs (1,203) (18,017) n/a (7,300) (18,609) 154.9% 44 Equity Accounted Investments 66 23 24 4.3% 36 22 (38.9%) Net Income Before Income Tax 21,370 (2,036) n/a 21,927 (3,241) n/a 1 40 Income Tax (4,178) 378 n/a (4,690) (322) (93.1%) 120 Net Income for the Period 17,192 (1,658) n/a 17,237 (3,563) n/a
0 Attributable to: Message text 128 0 Shareholders of the Company 16,520 (2,193) n/a 16,671 (3,938) n/a Non-controlling Interest 672 535 (20.4%) 566 375 (33.7%) 255 Highlight 0 Source: Company data 0 34 Table line colour 178 178 178 A Modern Global Airline with a Rich 90-Year Heritage
232 Chart Colours 235 240 Phase I Phase II Phase III Phase IV 182 (1923 – 1991) (1992 – 2006) (2007 – 2011) (2011 onwards) 196 204 1923: Russian civil 1992: Start of fleet 2009: Restructuring 2011: Acquired domestic aviation industry and modernisation first Airbus programme – new regional carriers Rossiya, 135 Aeroflot’s predecessor and Boeing 767 delivered corporate structure and Vladivostok Air, 157 established management team (CEO Sakhalinskie Aviatrassy, 179 2000: Listed on Moscow Vitaly Saveliev) Orenair from Rostec. 1980s: Flights to all Exchange Integration begins continents; passenger 2009: Further fleet (including Donavia) 0 112 annual traffic of 120m modernisation (+24 new 192 aircraft) 2013 – 2014: Regional airline integration ongoing. Creating Aurora 59 Airlines, a Russian Far 100 East carrier (merging 135 1991: Reorganised as 2006: Joined SkyTeam Vladavia and SAT) Joint Stock Company alliance 2010-2011: New modern 0 terminals D & E put into 176 operation at Russia’s 80 main airport (+25 gates and 17m passenger 22 capacity), Aeroflot’s hub 2014: Sochi 2014 44 Olympics official airline 66 2014: Launch of Low Cost Carrier 1 40 120
0 Message text 128 0
255 Highlight 0 0 35 Table line colour 178 178 178 Superior Product and Customer Experience
232 Chart Colours 235 240 Frequent Flyer Pre-flight Experience Ground Experience Inflight Experience Programme
182 Booking / Payment / Changes Fast and streamlined processes: Seat quality and design Marketing campaigns to boost and Amendments – Check-ins (airport and Outstanding flight experience traffic, joint promotions with 196 partners 204 Wide implementation of online online) around a wide-selection of high- services – Lounge quality food & beverages, inflight Recent developments: SMS – Desktop / mobile websites, – Boarding connectivity and entertainment notifications, ability to upgrade mobile applications across all classes class for bonus miles, 135 – Information purchasing tickets for bonus 157 – Multinational call-centre – Transit miles via mobile application, etc. 179 – Customer offices – Disembarkation / Luggage 2014 initiatives: platinum level Ancillary services introduction (concierge service)
0 112 192
59 100 Wide presence of 135 registration kiosks Priority check-in Full flatbed seats Comfort seats with Desktop Website Mobile applications Business class increased row space
0 Desktop Site Visitors per Annum (m) Programme Participants (‘000) 176 80 CAGR: 21% 62 Baggage drop-off Business class lounge 47 22 30 36 4,002 44 B777 2,724 Economy class 66
1 2010 2011 2012 2013 Boarding 2011 2013 40 120
№ 1 № 1 0 2013 2014 Message text 128 № 1 0 2013 Conde Nast Traveller Skytrax World Airline Awards Best Russian Airline Brand Awards Best Airline in Eastern Europe 255 Source: Company data 0 Best Company for Business Highlight Travellers 0 36 Table line colour 178 178 178 Experienced Management Team
232 Chart Colours 235 240 Board of Directors Management Board
Name / Position Biography 182 196 Board of Directors (11 Directors) Vitaly Saveliev CEO of Aeroflot Since April 2009 204 CEO Previously – First Vice-President Executive Directors Non-Executive Directors in AFK Sistema 135 Vitaly Saveliev Kirill Androsov 157 Dmitriy Saprykin Mikhail Alekseev 179 Dmitry Saprykin Joined Aeroflot in 2009 Independent Directors1 Dmitry Peskov Igor Kogan Deputy General Previously – Deputy Head of the 0 Marlen Manasov Director – Sales legal department in AFK Sistema 112 Igor Kamenskoy Vasiliy Sidorov 192 and Property Roman Pakhomov Sergey Chemezov Issues Director
59 Shamil Joined Aeroflot in 2009 100 Kurmashov 135 In 2007-2009 – Director of the Deputy General Investment Department – Deputy Director – Finance Head of the complex finance and 0 HR and Audit Strategy and Network & investment in AFK Sistema 176 Committee Compensation Committee 80 Committee Revenue Management 22 Chaired by Chaired by Chaired by Giorgio Callegari Joined Aeroflot in 2011 44 Igor Kogan Igor Roman Deputy General Previously – Executive Vice 66 Kamenskoy Pakhomov Director for President for Alliances and Strategy and Strategies in Alitalia 1 Alliances 40 120 Vadim Zingman Joined Aeroflot in 2009 Deputy General Previously – Director of the 0 Director – Department for Relations with Message text 128 Customer Service public authorities 0 Director
255 0 Highlight 1 0 In accordance with the definition of independence as per Russian corporate law and code of corporate conduct 37 Table line colour 178 178 178 Sheremetyevo Expansion to Support Future Growth
232 Chart Colours 235 240 Overview Sheremetyevo Site Layout
182 • Sheremetyevo is expected to become one of the leading 196 204 airports in Europe as a result of the implementation of a two-stage expansion programme Runway 3
135 Aircraft 157 • Stage 1 to be completed by 2017 Maintenance 179 ― Third runaway construction (length: 3,200 metres, To Moscow (link with North Terminal Non-stop High speed Complex Railway Moscow - width: 60 metres; able to host all types of aircraft) S.Peterburg) 0 Terminal C Vehicle Maintenance Railway Station 112 ― First stage of North Terminal reconstruction and Compound Pier 1 192 Airport Administration Offices opening of underground tunnel connecting North Pier 2 Terminal B Conference Centre/Hotel and South terminals Sheremetyevsky Business Park 59 highway Terminal A 100 Multilevel Car Multilevel Car Park 135 ― Airport capacity to grow up to 42m PAX p.a. Park To Moscow ― Northern Terminal complex capacity to reach 32m 0 Terminal D PAX p.a. upon first stage completion Terminal E 176 2.2% South Terminal Complex Terminal F 80 • Stage 2 to be completed by 2030 Cargo Complex Terminal G
22 ― Further development of the second landing area International Highway 44 ― New terminal facilities with capacity of 64m PAX Hotel 66 Railway p.a. Station
To Moscow Cargo Runway 1 1 Terminal ― Total cargo traffic of up to 1,115m tons Hotel 40 <
255 Highlight 0 0 38 Table line colour 178 178 178 Investor Relations Contacts
232 Chart Colours 235 240
182 196 204
135 157 179 Andrey Napolnov, CFA Nikolay Domrachev 0 112 192 Head of Investor Relations Senior IR manager Aeroflot – Russian Airlines Aeroflot – Russian Airlines 59 100 135 Tel: +7 (495) 258-06-86 Tel: +7 (495) 258-06-86 Mob: +7 (903) 247-78-08 Mob: +7 (903) 176-80-64 0 176 E-mail: [email protected] E-mail: [email protected] 80
22 44 66
1 40 120
0 Address: 119002 Russia, Moscow, Arbat St. 10 Message text 128 0 Telephone: +7 (495) 258-06-86 E-mail: [email protected] 255 Highlight 0 Website: www.aeroflot.ru 0 39 Table line colour 178 178 178