ENGLISCH Umschlag_2006 13.02.2007 11:32 Uhr Seite 1 6jhig^Vc6^ga^cZh<gdje6ccjVaGZedgi'%%+# Contents www.austrian.com « Fly with a smile. Highlights 1 The Group 2 Fly with a smile. Corporate Profile 2 » Departure into the Future 5 A New Direction 5 Strategy 9 Top Quality as Success Factor 15 Product and Service 15 Corporate Management and Control 21 Corporate Governance 21 Corporate Bodies 23 Risk Management 25 Austrian Airlines on the Capital Market 27 Austrian Airlines Shares 27 Investor Relations 31 Management Report 33 Business Development 2006 33 Segments 41 Outlook 51 Resources and Services 55 Human Resources 55 Fleet 59 Corporate Responsibility 63 Consolidated Financial Statements 65 IFRS Consolidated Income Statement 66 IFRS Consolidated Balance Sheet 67 IFRS Consolidated Statement of Changes in Shareholders’ Equity 68 IFRS Consolidated Cash Flow Statement 69 Notes 70 Introduction 70 Notes to the Consolidated Income Statement 77 Notes to the Consolidated Balance Sheet 80 Auditor’s Report 99 Report of the Supervisory Board 100 Equity Interests 101 Group Structure 102 Glossary 103 Contacts Cover Key Figures Cover Austrian Airlines Austrian Annual Report Group 2006 The interactive online version of this report can be found at www.austrian.com/report2006 lll#Vjhig^Vc#Xdb ENGLISCH Umschlag_2006 13.02.2007 11:32 Uhr Seite 1 6jhig^Vc6^ga^cZh<gdje6ccjVaGZedgi'%%+# Contents www.austrian.com « Fly with a smile. Highlights 1 The Group 2 Fly with a smile. Corporate Profile 2 » Departure into the Future 5 A New Direction 5 Strategy 9 Top Quality as Success Factor 15 Product and Service 15 'MZXJUI Corporate Management and Control 21 Corporate Governance 21 Corporate Bodies 23 Risk Management 25 Austrian Airlines on the Capital Market 27 Austrian Airlines Shares 27 Investor Relations 31 Management Report 33 Business Development 2006 33 BTNJMF Segments 41 Outlook 51 Resources and Services 55 Human Resources 55 Fleet 59 Corporate Responsibility 63 Consolidated Financial Statements 65 IFRS Consolidated Income Statement 66 IFRS Consolidated Balance Sheet 67 IFRS Consolidated Statement of Changes in Shareholders’ Equity 68 IFRS Consolidated Cash Flow Statement 69 Notes 70 Introduction 70 Notes to the Consolidated Income Statement 77 Notes to the Consolidated Balance Sheet 80 Auditor’s Report 99 Report of the Supervisory Board 100 Equity Interests 101 Group Structure 102 Glossary 103 Contacts Cover Key Figures Cover Austrian Airlines Austrian Annual Report Group 2006 The interactive online version of this report can be found at www.austrian.com/report2006 lll#Vjhig^Vc#Xdb ENGLISCH Umschlag_2006 13.02.2007 17:30 Uhr Seite 2 10,834.7 Contacts 10,119.8 9,404.9 Investor Relations Tel.: +43/5/1766-3311 Fax: +43/5/1766-3333 e-mail: [email protected] Internet: www.austrianairlines.co.at Key Figures Online Annual Report: www.austrian.com/report2006 Passengers carried (000) 2006 2005 2004 Communications Tel.: +43/5/1766-1230 Fax: +43/1/688 65 26 e-mail: [email protected] 2,662.8 2006 2005 +/– % 2004 2004 2003 2002 Austrian Airlines Head Office 2,485.8 Business Performance (IFRS) restated 1 1107 Vienna, Fontanastrasse 1 Tel.: +43/5/1766-0 2,357.9 Flight revenue EURm 2,458.8 2,260.5 8.8 2,087.0 2,087.0 1,906.4 2,055.2 Fax: +43/1/688 55 05 Operating revenue 2 EURm 2,662.8 2,485.8 7.1 2,357.9 2,363.5 2,242.7 2,398.0 Internet: www.austrian.com Operating result = EBIT EURm –89.0 –100.0 11.0 74.4 79.4 63.3 41.4 Operating Revenue Operating cash flow EURm 360.2 259.8 38.6 210.4 148.2 345.2 520.9 Reservation and Information ROTGA 3 % 5.4 5.2 0.2P. 5.9 5.9 6.2 7.7 Tel.: +43/5/1789 EURm 2006 2005 20041 4 Internet: www.austrian.com Cash Value Added (CVA) EURm –114.9 –165.0 – –207.0 –207.0 –194.8 –109.8 Change in CVA EURm 50.1 42.0 – –12.2 –12.2 –85.0 114.3 If you would like further information about the Miles & More Shareholders’ equity 31.12. EURm 784.8 565.6 38.8 686.4 630.9 604.5 557.0 74.4 frequent flyer programme, please contact the Miles & More Net Gearing 5 % 91.2 191.6 – 181.3 197.3 199.8 290.4 Service Centre in Vienna by telephone at any time on Investments and downpayments EURm 194.7 293.4 –33.6 267.9 205.7 201.0 248.7 (+43) (0) 1 68 055 4411, by fax on (+43) (0) 1 68 055 4414, or online at www.miles-and-more.at Personnel (average) 8,582 8,468 1.3 7,662 7,662 7,167 7,358 Operating result = EBIT –89.0 –100.0 1 EURm 2004 Capital market figures Reuters code AUAV.VI Earnings per share 8 EUR –3.55 –4.05 – 1.34 1.24 1.42 1.29 Diluted earnings per share 6 EUR –3.55 –4.05 – 1.27 1.18 1.35 1.26 2006 Dividend 7 EUR – – – – – – – 2005 Market capitalisation 31.12. 8 EURm 616.4 212.2 – 312.0 312.0 210.6 222.9 Disclaimer We have prepared this Annual Report and audited the data therein with Traffic statistics (scheduled and charter traffic) the greatest possible level of diligence. Despite this, the possibility of 191.6 181.3 Passengers carried 9 (000) 10,834.7 10,119.8 7.1 9,404.9 9,404.9 8,479.4 8,834.7 errors in rounding, setting or printing cannot be excluded. of which on scheduled flights (000) 9,095.8 8,316.1 9.4 7,823.8 7,823.8 7,051.7 7,269.2 91.2 This Annual Report also includes estimations and conclusions relating to Passenger load factor 10 the future, which we have reached on the strength of all the information (scheduled services) % 74.0 73.8 0.2P. 72.1 72.1 71.3 70.5 available to us at the time of going to press. As a rule, these conclusions Net Gearing relating to the future are phrased using terms such as "expect”, "esti- ATK per employee 11 (000) 492.9 490.3 0.8 513.2 513.2 470.9 458.4 1 mate”, "calculate” or similar. We would like to point out that the actual % 2006 2005 2004 Aircraft 105 106 –0.9 97 97 88 87 conditions – and thus the results – could deviate from the expectations presented in this report due to a range of other factors. Copy deadline: 2 February 2007 1 Restated; please see Note 3 for details of the adjustment in the Annual Report 2005 (retrospective application of the component approach). 2 Operating revenue: total turnover plus changes in inventories, services rendered for own account and carried as fixed assets a nd other operative revenues. 1.34 3 Return on Total Gross Assets (ROTGA): EBITDAR in relation to Total Gross Assets (= assets at acquisition cost minus non-interest-bearing debt). 4 Cash Value Added (CVA): (ROTGA minus WACC) x Total Gross Assets (= assets at acquisition cost minus non-interest-bearing debt). Imprint Earnings per share –3.55 –4.05 5 Net Gearing: long-term debt excl. provisions and tax accruals/deferrals minus cash-like items, in relation to shareholders’ equity. Publisher: Austrian Airlines, Fontanastrasse 1, 1107 Vienna 6 Adjusted by average number of own shares held by the company. Editorial advice: be.public Advertising and Financial Communications EUR 20041 7 Dividend 2006: due to the negative net result of the parent company, payment of a dividend is not allowed. Design: be.public, Jung von Matt, Eurografik® and 8 Adjusted to account for 1.7m bought-back shares from 2002 and considering the number of shares newly-issued as a result of the capital increase in 2006. Austrian Airlines Brand Management 9 Passengers carried: number of revenue passengers carried on individual flights. Flights with one flight number are counted as one flight only, regardless of Translation: Tim Martinz-Lywood, European Exchange Ltd. the number of stopovers. Typesetting, lithography and production: Eurografik® 10 Passenger load factor: available seats in relation to the number of revenue passengers in percent (RPK x 100/ASK). Photos: Austrian Airlines, Getty Images, Corbis and Viennapaint 11 Available ton kilometers per employee: weight capacity available on scheduled services in tons times distances travelled per airline employee (yearly average). Print: Stiepan-Druck 2006 DVR: 0091740 2005 Disclosure according para 14 Commercial Code: AG Vienna FN 111000k Member of 1 Restated; please see Note 3 for details of the adjustment in the Annual Report 2005 (retrospective application of the component approach). ENGLISCH Umschlag_2006 13.02.2007 17:30 Uhr Seite 2 10,834.7 Contacts 10,119.8 9,404.9 Investor Relations Tel.: +43/5/1766-3311 Fax: +43/5/1766-3333 e-mail: [email protected] Internet: www.austrianairlines.co.at Key Figures Online Annual Report: www.austrian.com/report2006 Passengers carried (000) 2006 2005 2004 Communications Tel.: +43/5/1766-1230 Fax: +43/1/688 65 26 e-mail: [email protected] 2,662.8 2006 2005 +/– % 2004 2004 2003 2002 Austrian Airlines Head Office 2,485.8 Business Performance (IFRS) restated 1 1107 Vienna, Fontanastrasse 1 Tel.: +43/5/1766-0 2,357.9 Flight revenue EURm 2,458.8 2,260.5 8.8 2,087.0 2,087.0 1,906.4 2,055.2 Fax: +43/1/688 55 05 Operating revenue 2 EURm 2,662.8 2,485.8 7.1 2,357.9 2,363.5 2,242.7 2,398.0 Internet: www.austrian.com Operating result = EBIT EURm –89.0 –100.0 11.0 74.4 79.4 63.3 41.4 Operating Revenue Operating cash flow EURm 360.2 259.8 38.6 210.4 148.2 345.2 520.9 Reservation and Information ROTGA 3 % 5.4 5.2 0.2P.