Acquisition of Bratislava and Kosice Airports Developing the future of the region Vienna - Bratislava - Kosice Herbert Kaufmann CEO Flughafen Wien AG February 2006 1 The Region Vienna – Bratislava - Kosice Vienna 2 Competition between Regions z The Bratislava-Vienna region is expected to be the fastest growing region in Europe. z The competitors of the Bratislava-Vienna region include Munich, Milan, Paris, Budapest, Prague, etc. 3 Catchment Area Criteria for the Catchment Area: • Access to the airport within two hours by car • Easiest access to a main airport 4 Propensity 0 1 2 3 4 5 6 7 8 9 Cyprus Malta Ireland Denmark to travel Luxemburg UK Spain Greece (trips Netherlands Sweden Finnland p er year Austria Portugal France Germany per inhabitant) Belgium Italy Ne EU 15 Czech Republic w E Source: Eurostat Estonia U Hungary member Slovenia Latvia states Lithuania 2004 Poland akia Slov 5 -10% 20% 30% 25% 10% 15% -5% 0% Growth inAirTransport (flights 5% Slovakia Czech Republic Estonia Lithuania Italy Latvia Hungary Belgium Ireland Poland Spain Slovenia f Austria lown) UK Germany Portugal Finnland Ne Malta EU 15 Source: Eurostat, 2004 w E France U Netherlands member Denmark Cyprus states Luxemburg Sweden 6 Vienna International Airport z Vienna Airport plc z Two runways - Privatised in 1992 z Airport area: 10km2 - Present ownership structure: z Full airport provider 40% Public sector (including ground handling) 10% Employee trust 50% Free float z 15.9 m passengers in 2005 z High dividend yield 7 Bratislava Airport z Airport area: 477 ha z Operated by: z 2 runways: - M.R. Stefanik Airport z Full airport provider - Runway 13/31: 3,190m (including ground handling) - Runway 04/22: 2,900m z 1.3m passengers in 2005 8 Kosice Airport z 1 runway: z Operated by: Letisko Kosice - Airport Kosice a.s. - Runway 01/19: 3,1000m z Full airport provider z 269,885 passengers in 2005 (including ground handling) 9 Passenger Growth 2000 – 2010 Bratislava-Vienna region 26 25 23.6 24 22.0 22 20.4 20 18.9 PAX m 18 17.2 16 15.7 13.3 14 12.2 12.2 12.4 12 10 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 10 Passenger Growth 2000 – 2010 Vienna International Airport 22 Growth rate 2007-2010: + 4.6% 20.0 20 19.1 18.3 17.5 18 16.8 2005: + 7.3% 15.9 PAX m 16 14.8 Forecast 2006: + 6% 14 12.8 11.9 11.9 12.0 12 10 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 11 Passenger Growth 2005 – 2015 Bratislava 6 5.0 5 4.5 4 3.7 2.9 PAX m 3 2.1 2 1.3 0.9 1 0.5 0.3 0.3 0.4 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 12 Passenger Growth 2005 – 2015 Kosice 500 480 444 450 404 400 361 s. 318 u 350 300 270 PAX tho 250 231 188 200 161 138 150 125 100 50 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 13 Vienna & Bratislava Airports Wide-ranging opportunities for growth • Leading position in Central Europe 2005: 17.2 million passengers: 15.9m (VIE) + 1.3m (BTS) 2010: 25 million passengers: 20m (VIE) + 5 m (BTS) 2015: 30.0 million passengers: 23m - 24m (VIE) + 6m - 7m (BTS) • Main drivers of development - Transfer and point to point trafic - Fast growing market with little exploitation in Slovakia 14 Cooperation allows for the best development of potential z Vienna: focused on transfer hub west/east/long-haul z Bratislava: focused on point-to-point traffic: low-cost carriers and charter , Competitive advantages over airports like Zurich, Munich, Budapest, Prague etc. z Kosice: focused on connections to hubs like Vienna and Frankfurt and tourism 15 Linking of Vienna and Bratislava market z Express connections between Vienna City Centre – BTS Airport less than 1 hour travelling time (CAT extension by 2009) z Starting 2006: City check-in in Vienna for flights from Bratislava City check-in in Bratislava for flights from Vienna plus bus connections 16 Consortium TwoOne The “Airport TwoOne“ consortium consists of: Voting rights z Flughafen Wien Aktiengesellschaft 50.1 z Raiffeisen Zentralbank Österreich AG (RZB) 20.0 z Penta Investment Limited 29.9 17 Key figures of the bid Bratislava - Price 10.5 billion SKK (~EUR 275 m) - Capital contribution: 7.9 billion SKK (~EUR 203 m) - Investment programme: 9.37 billion SKK (~EUR 240 m) over the first five years Košice - Price 900 million SKK (~EUR 24 m) - Capital contribution: 380 million SKK (~EUR 10 m) - Investment programme: 415.6 million SKK (~EUR 11 m) over the first five years 18 Key figures of the bid - Bratislava Consortium thereof VIE Purchase price 275 138 Capital contribution 204 102 Comitted investment 240 during the first 5 years - thereof capital 204 contribution - out of cash flow 36 19 Key figures of the bid - Kosice Consortium thereof VIE Offered purchase price 24 12 Capital contribution 10 5 Comitted investment 11 during the first 5 years - thereof capital 10 contribution - out of cash flow 1 20 Specific Expansion Projects for Bratislava Airport 22 projects have been defined for Bratislava Airport, each with an exact financial plan and time schedule: Project Forecasted Costs Schedule Existing terminal – expansion SKK 326 m (ca. € 8.4 m) 2006 - 2007 New terminal SKK 2,850 m (ca. € 73 m) 2006 - 2009 Expansion of runways SKK 1,243 m (ca. € 32 m) 2007 - 2010 Car park SKK 216 m (ca. € 5.6 m) 2006 – 2007 Further 18 projects SKK 4,735 m (ca. € 122 m) 2006 - 2010 21 Financial approach z Enterprise value (100%) of Bratislava Airport above EUR 534 m z EBITDA multiple (5 years average): 23 z Flughafen Wien AG -7% WACC - Debt / Equity ratio: 50:50 z Bratislava shows positive results after one year z From 2011 onwards profit contribution of Bratislava exceeds cost of debt 22 Synergies e.g. - Capacity management: (Construction of third runway in VIE will be postponed up to four years - Facility management - Procurement -IT 23 Privatisation Process BTS/KSC z 11 July 2005: Start of the privatisation process z 5 September 2005: Submission of the preliminary bid z 15 September 2005: Selection of short-listed bidders z 5 December 2005: Submission of the final bid z 20 December 2005: Preferred bidder/privatisation commission z 20 January 2006: Announcement of second round z 27 January 2006: Submission of final bid/second round z 1 February 2006: Preferred bidder/government z OUTLOOK: z Signing of the final contract with the National Property Fund and Ministry of Transport z Summer 2006: Expected closing of the privatisation process after approval by the Anti-Monopoly Office 24 Thank you for your attention. 25.