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Company News

28 October 2009

At the Board of directors

AEROFLOT’S BOARD OF DIRECTORS HOLDS A MEETING

October 28 2009, Moscow – Today, Transport Minister of the Russian Federation Igor Levitin has chaired a regular meeting of Aeroflot JSC Board of Directors.

The Board has analyzed the preliminary results of the company’s operational, financial and economic activity in nine months of 2009 года. The company has carried 6.5 million passengers (91% of the 2008’s figure); passenger traffic was 19,214 million passenger-kilometers (92% compared to 2008). It was noted that the 92% decrease in Aeroflot’s carriage volume, resulting from shrinking demand in the situation of a 15% drop on the Russian market, has nevertheless allowed the company to boost its market share and add 0.5% to its flight productivity (ton-kilometer per hour) compared to the same period last year.

In spite of the 9% decline in receipts compared to 2008 the company’s net profit has risen by 8% to reach RUB 5,980 million by RSA with EBIDAR rising by 13% to reach RUB 16,630 million. The net profit growth in 9 months of 2009 has resulted, partially, from the higher-than-anticipated growth of 9.2% in operational revenues 9.4% over operational expenditures.

The Board has approved the lease financing transactions for six А321 aircrafts and the new jet aircrafts of regional class SSJ-100.

The meeting paid attention to the cost and operational expenditure reduction in Aeroflot JSC in 2009. The Board noted that the cost-reduction measures taken in 2009 allowed the economy of USD 859 million against the previously adopted budget, including a USD 66 million economy against the budget corrected in May 2009. Along with falling jet fuel prices, the effect mainly owes to the measures aimed at route network optimizing, airport service taxes revision, commercial and administrative cost reduction, and online sales promotion. The program of 2009 has enabled the company to reduce costs by 10% as compared to the respective indicators of 2008.

A matter of the company’s investment program implementation in 2009 has also been considered. It was noted that the main vector in the company’s investment policy is efficiency boosting and production capacities regeneration. The main investment programs in 2009 have been aimed at passenger air fleet development, Terminal В capacities provision, construction of an office in Melkisarovo (Sheremetyevo-2). The fleet renovation program has been implemented as scheduled. The construction of the company’s new office has been finished, and a significant number of the company’s production unit staff have been moved there already. The major part of the equipment necessary to improve Terminal D ground infrastructure has been purchased. The technical launch of the Terminal is scheduled for November 2009. The 2009’s capital expenditures have been kept within the limits set by the Board. The Board of Directors has approved the capital investment plan of RUB 1,954 million for H2 2009, within the budgetary RUB 3,195 million approved by the Board for 2009.