
AEROFLOT GROUP Q2 & 6M 2020 IFRS R ESULTS 31 August 2020 Speakers: Andrey Chikhanchin – Deputy CEO for Commerce and Finance Andrey Panov – Deputy CEO for Strategy, Service and Marketing Ivan Batanov – Head of Revenue Management Disclaimer This document has been prepared by PJSC “Aeroflot” (the “Company”). By attending the meeting where the presentation is made, or by reading the presentation slides, you agree to the following. 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 the basis of, or be relied on in connection with, any contract or investment decision. No reliance may be placed for any purpose whatsoever on the information contained in this document or on assumptions made as to its completeness. No representation or warranty, express or implied, is given by the Company, its subsidiaries or any of their respective advisers, officers, employees or 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 contents. This document may include forward-looking statements. These forward-looking statements include matters that are not historical facts or statements regarding the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial 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 that forward-looking statements are not guarantees of future performance and that the Company’s actual results of operations, financial condition and 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 update any forward-looking statements to reflect events that occur or circumstances that arise after the date of this presentation. 2 Aeroflot Group 6M 2020 Highlights PAX Yield Revenue External Factors Million PAX RUB / RPK Billion RUB - 54.2 % - 2.5 % - 52.0 % COVID-19 3.79 311.4 28.2 mln 3.69 149.4 12.9 mln 6M 2019 6M 2020 6M 2019 6M 2020 6M 2019 6M 2020 Note: immaterial deviations throughout the presentation are explained by rounding • In 6M 2020 Aeroflot Group’s performance was seriously affected by COVID-19 amid significant pressure on demand in the domestic segment of the market and the complete closure of the international segment from the end of March with respective implications for financials. 3 1. Market Update and Operating Results 2. Strategy 2028 3. Network and Schedule Overview 4. Fleet Overview 5. Financial Performance 6. Appendix 4 Overview of the Russian Market Passenger Traffic: Market vs Aeroflot Group Key Market Players Russian Air Transportation Market (million PAX) Change in PAX million incl. PAX of Russian and Foreign Carriers and intl. transit PAX -15.3 (53.6)% International Routes 12.9 66.2 Domestic Routes -7.1 -3.4 33.0 -5.6 6.1 4.8 -2.2 -1.9 (87.9)% 2.9 30.7 38.1 2.0 1.9 11.6 19.7 33.2 Aeroflot S7 Group Ural Airlines UTair Group Foreign Others Group Carriers 19.1 18.4 4.6 0.1 4.5 6M 2019 6M 2020 Q2 2019 Q2 2020 Market Shares Aeroflot Group (million PAX) 6M 2019 6M 2020 (54.2)% 20.0% 19.9% 28.2 42.6% 42.1% (88.8)% 9.4% 12.7 12.8% 15.4 6.3% 5.8% 12.9 6.7% 6.4% 7.0 15.6% 4.6 12.3% 15.5 8.4 8.5 1.7 0.05 1.7 6M 2019 6M 2020 Q2 2019 Q2 2020 Foreign Carriers Others Source: TCH, Aeroflot Group. Figures include foreign carriers’ traffic. • The market’s and Aeroflot Group’s performance remained under significant pressure in Q2 and 6M 2020 amid 5 adjustment in demand in the face of COVID-19 in the first quarter of 2020, which extended into following quarters. Material Impact of COVID-19 Starts from March Monthly PAX Traffic (Russian Carriers) Capacity (Russian Carriers) and PLF Million PAX Billion ASK, PLF in % Jan Feb Mar Apr May Jun Jul Jan Feb Mar Apr May Jun Jul 30.5 8.9 8.0 26.7 23.5 6.8 6.4 17.6 79% 79% 75% 69% 2.8 9.5 58% 4.0 4.4 0.9 44% 0.7 39% 6.6% 6.4% (28.1)% (92.1)% (91.3)% (77.4)% (52.4)% 10.0% 8.7% (17.6)% (86.0)% (86.6)% (73.8)% (54.3)% Source: TCH, Federal Air Transport Agency, Aeroflot Group calculations Source: TCH, Federal Air Transport Agency, Aeroflot Group calculations • The Russian market was substantially hit by COVID in April and May 2020 with recovery starting from June and extending into Q3. • Load factor shows positive progression as airlines cautiously add capacity below demand recovery levels. 6 Domestic Segment Shows Gradual Recovery PAX Traffic of Russian Airports Q3 – International Segment PAX dynamics based on 33 key Russian airports Flights reopened starting from 20% 7% 7% 1 August with following countries: 0% • United Kingdom • Turkey -20% • Tanzania • Switzerland (25)% -40% Q3 – Domestic Segment (45)% -60% Steady recovery in domestic -80% (74)% segment continuing in July and (91)% (90)% August -100% Jan Feb Mar Apr May Jun Jul Total Domestic International Source: Russian international airports association (MAA), Federal Air Transport Agency • Domestic segment showing signs of recovery from June as travelling restrictions within Russia are gradually lifted while international segment opening only a handful of destinations from August. 7 Aeroflot Group Performance Across Different Brands Brand Business Model 6M 2020 PAX Contribution1 and Dynamics July 2020 • Flagship carrier -56.1% • Premium product (4 Stars) 17.8 -72% PAX Premium • High income and middle class 60.4% 7.8 7.8 -74% ASK • Hub and spoke model 6M 2019 6M 2020 • Scheduled network under SU -64.1% (Aeroflot) code from 5.1 -49% PAX Mid-price − Moscow (SVO) 1.8 14.1% 1.8 − St. Petersburg (LED) -42% ASK • Charter operations 6M 2019 6M 2020 -35.8% • Point-to-point carriage 4.6 • Focus on domestic +2% PAX 2.9 2.9 Low Cost segment and underserved 22.7% international routes -3% ASK 6M 2019 6M 2020 • Airline for communities in the -51.6% Russian Far East offering 0.7 -62% PAX Regional flights 0.4 2.8% 0.4 − between large cities -48% ASK − to remote cities 6M 2019 6M 2020 Source: Aeroflot Group 1 PAX contribution as of 6M 2020. Absolute number of passengers in million in green circle • Material decline in demand and closed borders have resulted in 6M traffic decline for key carriers of the Group, including Pobeda suspending operations for April and May. In Q3 the Group is observing the gradual recovery of 8 the domestic segment. Pobeda Airline: Timely Value Proposition Overview Total PAX dynamics in 2020 mn PAX, change y-o-y 1.0 Operations restarted in June 2020 0.9 after suspension in April and May amid demand decrease 0.8 0.7 2.9 mm PAX transported in 6M 2020 (-35.8% y-o-y) 0.4 90.1% PLF LF remained high in 6M 2020 despite ongoing pressure 0.0 0.0 30 B737NG aircraft Jan Feb Mar Apr May Jun Jul with single class cabin (189 seats) 33.9% 31.7% 3.0% (99.9)% (99.9)% (51.5)% 1.6% 11 p.p. RPK mix shift from international to domestic in 6M 2020 y-o-y Beginning of 2020 route network Operating Indicators of July 2020 (Domestic) Petrozavodsk Surgut Helsinki Domestic traffic already recovered to 2019 levels 14 Saint Petersburg Kirov Perm Krasnoyarsk Moscow Kazan Ekaterinburg Tomsk Riga Novosibirsk 62 Cheboksary Nizhnekamsk Tyumen Ulyanovsk Kaliningrad Chelyabinsk Omsk Kemerovo Samara Magnitogorsk Eindhoven Berlin Ostende Leipzig Ulan-Ude 5,797 Cologne Karlovy Vary 94.4% Baden-Baden Salzburg Volgograd 1,039 Memmingen Bratislava Rostov Innsbruck Astrakhan Bergamo Krasnodar Venice Anapa Min.Vody Genova Gelendzhik Nazran Pisa Rimini Varna Sochi 12 Tivat Vladikavkaz Makhachkala Girona Rome Tbilisi Bari Istanbul Batumi Gyumri Cagliari Palermo Antalya Traffic, th PAX Revenue flights, PLF, % Catania Bodrum Gazipaşa Dalaman Larnaca cycles Cities the airline operates flights to Base cities with >10 routes served from city XX 27.1% 30.4% (3.2) p.p. Cities with <10 routes served from city (number of routes in circle) Source: Aeroflot Group • Pobeda has restarted operations in June 2020 recovering significant volume of traffic in domestic segment 9 amid strong load factor and is uniquely positioned to bring back more capacity leveraging its value proposition appealing to cost conscious passengers. 1. Market Update and Operating Results 2. Strategy 2028 3. Network and Schedule Overview 4. Fleet Overview 5. Financial Performance 6. Appendix 10 Key Goals of the Updated Strategy Key Strategic Goals Stronger Accelerated position of development Increase of Aeroflot Airline of Pobeda Airline to m Aeroflot in the premium 130 improve air travel PAX Group’s PAX segment due to affordability and the Group’s stimulate demand transformation Aeroflot Group: Now and Then 2019 PAX (mn) 2028 • Optimization of the network Premium carrier according to routes’ yield with international recognition, 37 35-40 developing transit • Best-in-class premium quality service Low-cost carrier, • Supporting high population one of the largest and one of the 10 55-65 mobility 1 most cost efficient in the world • Stimulating demand through more affordable ticket prices Regional carrier, • Operating modern Russian- routes bypassing Moscow, social 12 20-30 manufactured aircraft function and regional connectivity • Socially important routes, inter-regional network 1 Based on CASK ex.-fuel benchmarking, calculated based on airlines’ data.
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