AEROFLOT – RUSSIAN AIRLINES INVESTOR PRESENTATION June 2014 \\IBLNS003VF\EAST2013\03 Presentations\Graphics\Template\01 Aeroflot Cover.psd Disclaimer 0/58/129 This communication has been prepared by and is the sole responsibility of the issuer that is the subject of this communication. This communication 148/190/224 is provided for information purposes only. Any offering of any security or other financial instrument that may be related to the subject matter of this communication (a “financial instrument”) will be made pursuant to separate and distinct documentation (an “offering circular”) and in such case the information contained herein will be superseded in its entirety by any such offering circular in its final form. 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The distribution of this document and availability of these products and services in certain jurisdictions may be restricted by law. 200/200/200 255/102/0 1 Aeroflot Today – #1 Russian Carrier with a Global 0/58/129 Network 148/190/224 1 #1 airline in one of the fastest growing global markets with leading positions on both domestic and international routes 2 An expanding global network with 1411 destinations in 54 countries (incl. Russia) 119/119/119 3 Best product and customer experience in our markets 79/115/160 4 Multi-brand offering to reach the full customer spectrum and meet demand across geographies 255/135/102 5 Modern, efficient fleet – one of the youngest in Europe 6 Solid track record of delivering positive financial results and shareholder returns 92/155/209 7 Strong financial and organisational platform and clear strategy for future profitable growth 200/200/200 1 Without code sharing. 255/102/0 2 Modern Global Airline, Rich 90-year Heritage 0/58/129 148/190/224 2010-2011: New 1991: 2000: Listed modern terminals 2006: Joined 2014: Launch of Reorganised as on Moscow D & E put into operation SkyTeam Official airline Low Cost Carrier Joint Stock Exchange at Russia’s main airport alliance Company (+25 gates and 17m 119/119/119 passenger capacity), Aeroflot’s hub 1923 1980s 1991 1992 2000 2006 2009 2011 79/115/160 2013 - 2014 255/135/102 1923: Russian 1980s: Flights to 1992: Start of 2009: Restructuring 2011: Acquired 2013 – 2014: civil aviation all continents; fleet programme – new corporate domestic regional Regional airline industry and passenger annual modernisation structure and management carriers Rossiya, integration ongoing. Aeroflot’s traffic of 120m first Airbus and team Vladivostok Air, Creating Aurora 92/155/209 predecessor Boeing 767 (CEO Vitaly Saveliev) Sakhalinskie Aviatrassy, Airlines, a Russian Far established delivered East carrier (merging 2009: further fleet Orenair from Rostec. Vladavia and SAT) modernisation (+24 new Integration begins aircraft) (including Donavia) 200/200/200 Major developments over the past 5 years strengthened Aeroflot’s position and created the platform for future growth 255/102/0 3 0/58/129 148/190/224 119/119/119 Strategic Overview: Market Dynamics and Aeroflot’s Approach 79/115/160 255/135/102 92/155/209 200/200/200 255/102/0 4 Global Air Transportation: 2014 a Rebound Year 0/58/129 Source: Demand: European PAX Growth Accelerating in 2014 Supply: European ASMs1: Risk for 2014? 1) Demand: PAX Growth: c.5.7% 148/190/224 in 2013 vs. 3.7% in 2012 24% 120 000 40% 2) Supply: European ASMs: Risk for 2014? 18% 96 000 30% https://360.gs.com/gs/portal/?st= 12% 1&action=action.binary&d=16411 72 000 20% 685&fn=/document.pdf 119/119/119 6% 5,3% 48 000 10% 3) Jet Fuel Prices: Further 0% Downside in 2014 24 000 0% https://360.gs.com/gs/portal/?st= (6)% 1&action=action.binary&d=16268 0 (10)% 907&fn=/document.pdf (12)% янв-2010 янв-2011 янв-2012 янв-2013 янв-2014 4) Improving EBIT margin: 79/115/160 янв-2005 июл-2006 янв-2008 июл-2009 янв-2011 июл-2012 янв-2014 Europe ASM (LHS) ASM YoY (RHS) http://www.iata.org/whatwedo/Do cuments/economics/IATA- Jet Fuel Prices: Further Decline Possible in 2014 Improving EBIT Margin of the Air Transportation Industry, % Economic-Briefing-Financial- Forecast-December-2013.pdf $3,3 60% $3,2 2,0% 0,8% 0,7% 1,3% 45% 2,4% 8,0% 255/135/102 $3,1 6,4% 5,7% 4,8% 4,4% 30% 4,1% 3,5% $3,0 3,4% 3,0% 3,3% 2,8% $2,9 1,2% 15% 0,1% $2,8 0% $2,7 $2,6 (15)% (1,8)% 92/155/209 (2,2)% (4,7)% Q3 2013 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q4 2013 Q1 2011 2008 2009 2010 2011 2012 2013E 2014E Q1 2014E Q2 2014E Q3 2014E Q4 2014E Jet Fuel Price, $/gal YoY Change North America Europe Asia-Pacific 200/200/200 Positive GDP outlook and accelerating passenger traffic are expected to translate into gradually expanding industry profitability in the mid-term Source: ATA, IATA, OAG 1 Average seat-miles. 255/102/0 5 Regional Growth Trajectory 0/58/129 Growth Rates for 2013-2032 148/190/224 Global North America Europe Russia and CIS 5,9% 4,7% 119/119/119 3,2% 3,3% 3,5% 4,0% 2,5% 1,8% RPK Growth GDP Growth RPK Growth GDP Growth RPK Growth GDP Growth RPK Growth GDP Growth 79/115/160 Latin America Middle East Asia Pacific 6,4% 5,8% 5,2% 255/135/102 4,5% 4,0% 3,7% 92/155/209 RPK Growth GDP Growth RPK Growth GDP Growth RPK Growth GDP Growth Regional growth forecast to exceed global trend Regional forecast to lag behind global trend Source of 3bn passengers currently: Number of annual air travellers increased by one third in the last decade, currently approaching 3bn. This trend is http://www.icao.int/Newsroom/Pages/ 200/200/200 set to continue with passenger traffic more than doubling in the next 20 years, with growth pace higher in annual-passenger-total-approaches- emerging markets 3-billion-according-to-ICAO-2012-air- transport-results.aspx Source: Airbus Global Market Forecast 2013-2032 255/102/0 6 Emerging Markets’ Fundamentals 0/58/129 10 Largest Economies in 2030 Global Middle Class by 2032 5,211 148/190/224 757 x2 Other 3,576 578 3 526 x4 Asia Pacific 47,5 MiddleClass¹ 2,228 35,8 432 2 038 856 119/119/119 4,1 North America (millions of people)(millions 253 10,4 8,7 6,7 6,6 6,3 Global 265 262 5,4 5,2 675 698 675 Europe & CIS UK GDP ($ trillion, Nominal) 2012 2022 2032 World USA India Brazil China Japan 7,100 7,800 8,400 Population Russia Turkey France 2030 Germany % of World 32% 46% 62% 79/115/160 Emerging Markets Developed Markets Population GDP/Capita in 2030 A Global World: Air Transport’s Increasing Distribution 2030 Real GDP/ Capita as a Multiple of 2013: 100 90 2.9x 1.5x 3.1x 1.7x 1.2x 1.3x 1.8x 1.4x 1.3x 2.3x 80 47% 255/135/102 70 69% 63% 101,0 60 50 40 24% 30 83,1 77,3 76,2 (%) Capacity 20 14% 18% 6,9 60,1 56,8 47,1 33,7 28,4 10 10% 12% 22% Share of Offered WorldShare 0 92/155/209 UK USA India 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Brazil China Japan Turkey Russia France Advanced Advanced Advanced Emerging Developing Emerging Germany 2030 GDP per Capita'000) GDP per ($ 2030 Emerging Markets Developed Markets Advanced Developing Developing Developing Emerging Emerging 200/200/200 Emerging markets’ economic growth, large populations and developing middle class forecast to be the main drivers of air traffic volumes Source: Euromonitor, Airbus Global Market Forecast 2013-2032 255/102/0 7 Russian Total Passenger Traffic Growth: Significant Strength of the Russian Market \\IBLNS003VF\EAST2013\07 Due diligence\CMD materials\Market Dynamics\Airline