december 2019 - en.about.aegeanair.com
TRANSCRIPT
Corporate Presentation
December 2019
Flying to 151 destinations in 44 Countries AEGEAN become
Europe’s Best Regional Airline and hold first place for the Quality of its Services.
Aegean Airlines at a glance
2
Create Valu
e
Superior Growth Achievements
Commitment to translate efficiency into a profitable business model that creates value to employees, stakeholders and society.
Sustainable business model with key strategic focus area in operational
quality and cost efficiency .
Efficient Operating Model
3
199920002001
20032005
20072010
20112013
20182019
2020…
1999Launch scheduled flights;Domestic market deregulation.
2000Acquisition of Air Greece.
2001Merger with Cronus.
First profitable year pre-tax basis;Low cost carriers enter Greek market.
2005Lufthansa’s regional partner;Airbus A320 order.
2003 Listing in Athens Exchange, raising €135m through IPO;First A320 deliveries.
2010Star AllianceMember
2007
International traffic exceeds domestic for the first time.
2013Olympic Air acquisition.
2011
20 years of experience
Airbus order of up to 42x A320neo aircraft. Sign MoU with Pratt & Whitney to power up to 62 Airbus A320neo Family Aircraft with GTF™ Engines.
2019Issue a EUR 200 mil. Common Bond Loan.
2018
Delivery of new fleet
4
Continue to develop our strengths and focus on our key pillars
Strong Brand Names
Professional and highly dedicated
EmployeesHomogenous Fleet
Current: 49x Airbus 320
CEO familyExpected:
46x Airbus 320 NEO family
Powerful Partnership
- Customer and Services;- Network and Fleet development;- People and Organization;- Innovation;- Sustainability.
3.146
Extensive Network
5 P
illar
s
• Aegean acquires a historical brand name in Greek aviation in 2013;
• Scale Economies;
• Network synergies, connectivity gains, full access to all domestic destinations;
• Complementary fleet;
• Consolidating management services (personnel, facilities, systems);
• Significant cost and revenue synergies.
5
Gain leverage from Olympic air acquisition
6
3,2 3,0 2,6 2,5 5,2 5,6 5,7 5,9 6,1
3,1 3,53,5 4,3
4,96,0 6,7 7,3 7,8
2,06,2 6,5
6,1
8,8
10,1
11,6
12,5
13,2
14,0
2010 2011 2012 2013 2014 2015 2016 2017 2018
Passenger Evolution (in mil.)
Domestic
International
Olympic
68,1% 68,9%
74,3%78,3% 78,3% 76,9% 77,4%
83,2% 83,9%
Load Factor Evolution
155
166 168
127132
139144
148153
Capacity per flight
Passenger and Load Factor Evolution
39 Greek airports but 1 metropolis
Traffic in pax Number of Airports
Main Airports
>20m 1 Athens
>6m 3 Thessaloniki, Heraklion, Rhodes
1-6m 6Chania, Corfu, Kos, Santorini
Zakynthos, Mykonos
200k-600k 9 -
<200k 20 -
Total 39 - Source: Hellenic Civil Aviation Authority, AIA
5,8 6,1 5,6 4,9 4,5 4,3 5,3 6,4 7,2 7,3 7,7
10,6 10,1 9,9 9,58,4 8,2
9,9
11,7
12,9 14,416,4
0
5
10
15
20
25
30
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Passengers AIA (in mil.)
Domestic Passengers International Passengers
6,5 6,8 6,2 5,6 5,1 5,0 6,0 7,3 7,9 8,2 8,5
27,8 26,0 25,8 27,6 26,428,5
32,534,3
37,1
41,545,4
0
10
20
30
40
50
60
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Passengers Greek Airports (in mil.)
Domestic Passengers International Passengers
7
Contributing to market’s growth
❑ Aegean is a Star Alliance member since 2010, the largest global airline alliance (28 memberairlines) providing benefits to both the customers and the company.
❑ Adding value to passengers’ travel experience through:- Access to a worldwide network – "Global" reach;- Seamless worldwide travel services;- Frequent Flyer Programs linked;- Privileged access to facilities, lounges, priority check-in, boarding, baggage.
USD 170,95 bil. 1,615.23 bil.
more than 19,000 727.62 mil.
195 423,210
28 4,919
1,317 more than 1,000
Total Revenue
Daily departures
Countries served
LoungesAirports served
Fleet
Number of employees
Fact
s &
Fig
ure
s Annual Passengers
Revenue Passengers km
Airline members
The Star Alliance Network
Source: Star Alliance as of Oct. 2019
8
Star Alliance membership: vote of confidence
9
2019 ScheduleAegean increased capacity with additional frequencies and new routes to Marrakech,
Casablanca, Ibiza, Valencia, Sarajevo, Tunis,Skopje, and from Thessaloniki to Hannover.
Stronger load factor84,5% vs 83,6% ↑| 1 pp YoY.
151 destinations 31 domestic and 120 international
to 44 countries.
Network development
Improved 9M 19 operating figures90.420 flights ↑| 5 % YoY14.438 ASK’s ↑| 8 % YoY12.232 RPK’s ↑|10 % YoY
921 avg sector length ↑| 1 % YoY.
TOTAL NUMBER OF EMPLOYEES
3,146*
EMPLOYEE BREAKDOWN BY GENDER
41% MEN 59%WOMEN
2013
2014
2015
2016
2017
2018
+1000 jobs generated
10
Adding value to employees
* As of July 2018
-Assessment through personality, technical skills, functional test;
-More than 40,000 candidate applications each year;
-More than 2,000 interviews
annually.
Recruitment
-40-50% of our personnel will receive incentives linked to productivity;
-600 employees linked to profitability.
Incentives
-Every opening offered both internally and externally;
-Support employee rotation; 800 people moved internally;
-Scholarships for pilots.
Development
-Annual or bi –annual internal evaluations;
-Psychologist support for flight operators.
Evaluation
Pers
on
nel
cu
ltu
re
Customer focus
Customer centric company always providing a positive customer experience, in a commoditized LCC driven European Short Haul Market.
The extra smile and attentiveness of the crew.
Catering when almost no one else has it, promoting Greek Products.
The Inflight Magazine.
12
✓ AEGEAN has been recognized in the2019 TripAdvisor Travelers’ Choice®awards for Airlines winning thedistinctions of:
✓ Best regional Airline in Europeaccording to Skytrax for 2019 for theninth consecutive year, and for thetenth time in eleven years.
▪ Best Regional Airline Europe▪ Best Regional Business Class
Europe▪ Best Airline in Greece
✓ AEGEAN voted 5th on the World'sBest International Airlines in 2018Readers' Choice Awards of CondéNast Traveler (outside the US).
Brand recognition and preferability
13
Next generation- 46x 320 neo family
7x-Direct leases 7
2x - Airbus order9x - Direct leases
11
8x-Airbus order 8
10x-Airbus order 10
2020
2021
2022
2023
10x-Airbus order 102024
Strategic imperative to continue to operate a young, modern and efficient fleet.
- The new fleet will facilitate replacement of existing fleet and manage growth.
- Lease CEO expiration schedule allows for multiple options.
- Maintain some of CEO A/C for seasonal operation use.
- Right size fleet balance jet aircraft vs turboprop –decision not taken yet.
- Address current low ownership mix.
Quality upgrade Improved Range Possibilities
Fuel Savings Financial BenefitsAegean’s specific benefits
High quality level of service
▪ Operational opportunities to reach new and more remote destinations.
▪ The new engine option offer 15% fuel saving and an improved energy footprint for the Group.
▪ Increased seat capacity per aircraft.
▪ New services mostly digital.
▪ Re-contracting of maintenance; Non-maintenance reserves requirements.
▪ Improved cash flows.▪ Reshaping ownership
cost owned/lease fleet mix.
▪ Lease Duration
14
Multiple benefits from A320 neo fleet
Operated with the same number of fleet:49 Jets and 12 Turboprops.
61 aircraft
Flew 5% more YoY in 151 destinations in 44 countries.
90.420 flights
Offered 8% more ASK’s and welcome more than 7% YoY passengers on board.
11,6 mil. passengers
Improved load factor by 1 pp YoY.
84,5%
Top line growth continued with a 10% increase YoY.
€ 1.031,9 mil. revenues
Key figures9M 2019
Flattish unit costs excluding fuel (on EBIT level).
€ 4,9 CASK
€ 77,1 mil. net profit
Strong Balance Sheet.
€ 637,2 mil. cash and cash equivalents
Despite increased fuel cost and negative IFRS 16 impact reported profit.
16
Operating Environment
0
2.000
4.000
6.000
8.000
10.000
12.000
14.000
16.000
Q3 2018 Q3 2019 9M 20189M 2019 FY 2017 FY 2018
Aegean: Strong International Passengers growth
Domestic pax International pax
↑| 10%
↑| 12%
↑| 2%
↑| 7%
↑| 4% →| 0%
0
10.000
20.000
30.000
40.000
50.000
60.000
Q3 2018 Q3 2019 9M 20189M 2019 FY 2017 FY 2018
Total Greek Airports
Domestic pax International pax
↑| 5%
↑| 5%
↑| 3% ↑| 1% ↑| 3%
↑| 9%
AEGEAN carried 11,6 million passengers during 9M 2019, reporting a 7% growth inpassenger traffic. This growth is almost entirely due to the company’s 12% increase ininternational passengers (694.000 additional passengers), reaching 6.8 millionpassengers in 9M 2019, having invested 715.000 additional seats.
Aegean grew more than the market
Sources: Company and YPA.
17
Operational Excellence
Increased asset utilization and improved load factors
0
20.000
40.000
60.000
80.000
100.000
120.000
FY 2017 FY 2018 9M 2018 9M 2019
Total Flights
↑| 1% ↑| 5%
0,72
0,74
0,76
0,78
0,80
0,82
0,84
0,86
2015 2016 2017 2018 9M 2019
Scheduled Load Factor
Load factor - Scheduled (RPK/ASK) Load factor - Scheduled (Pax/AVS)
740 760 780 800 820 840 860 880 900 920 940
2015 2016 2017 2018 9M 2019
Average Sector Length
Average Sector Length
In 2019 we operate with 61 aircraft and offer 700,000 more available seats.
18
Organic Growth along the years
16.383
16.657
17.245
13.347
14.438
2016
2017
2018
9M 2018
9M 2019
Available seat kilometers in millions
↑| 4%
↑| 2%
↑| 8%
8,1 8,2 8,3 8,5 8,5
2016 2017 2018 9M 2018 9M 2019
Passenger Yield in € cents
↑| 1% ↑| 1% →| 0%
12,513,2
14,0
10,811,6
2016 2017 2018 9M 2018 9M 2019
Passenger Number in millions
↑| 6% ↑| 6%
↑| 7%
Domestic International Total
2018 284,7 902,7 1.189,5
2017 286,1 841,6 1.127,6
% change -0,5% +7,3% 5,5%
Revenue growth supported by international network expansion
19
Cost discipline despite increase in jet fuel cost
827,6884,3
960,0
725,9812,4
2016 2017 2018 9M 2018 9M 2019
Total operating costs in € millions
↑| 7% ↑| 9%
↑| 12%
4,50
4,60
4,70
4,80
4,90
5,00
5,10
2015 2016 2017 2018 9M 2018 9M 2019
CASK- EBIT level excl. fuel cost in € cents
2018Total Operating Cost: EUR 960 mil.
*excluding operating leases
20
↑|7,1%
↑|16,5%
↑|12,2%
↑|6,3%↑|9,0%
↑|7,7%
↑|12,5%
↑|10,2%
↑|21,0%
↑|15,5%
0,0%
5,0%
10,0%
15,0%
20,0%
25,0%
0,0
50,0
100,0
150,0
200,0
250,0
Employeebenefits
Aircraft fuel Aircraftmaintenance
Overflightexpenses
Groundhandlingexpenses
Airportcharges
Cateringexpenses
Distributionexpenses
Marketingand
advertisingexpenses
Otheroperatingexpenses
9M 2018 9M 2019Amounts in € mil.
Cost per ASK 9M 18 9M 19 % change
Employee benefits 0,75 0,74 -1%
Aircraft fuel 1,40 1,50 8%
Depreciation 0,11 0,75 n.m.
Aircraft leases 0,74 0,01 n.m.
Aircraft maintenance 0,94 0,97 4%
Overflight expenses 0,39 0,39 -2%
Ground handling expenses 0,38 0,39 1%
Airport charges 0,37 0,36 0%
Catering expenses 0,19 0,19 4%
Distribution expenses 0,45 0,46 2%
Marketing and advertising expenses 0,08 0,09 12%Other operating expenses 0,49 0,53 7%
CASK – EBIT level 6,3 6,4 2%
CASK – EBIT level (exc. fuel costs) 4,9 4,9 0%
ASK’s 13.347 14.438 8%
Cost evolution reflects higher activity and higher utilization of jet fleet; higher effective unit fuel cost
21
Strong bottom line performance
0
10.000
20.000
30.000
40.000
50.000
60.000
70.000
80.000
90.000
FY 2017 FY 2018 9M 2018 9M 2019
Net Income
Sustainable growth3%
5% 6%
2016 2017 2018
Net Profit Margin Evolution
Q3 18 Q3 19 YoY % 9M 18 9M 19 YoY %
Revenue
483,6 512,5 6% 939,3 1.031,9 10%
EBITDAR
175,1 168,7 -4% 225,1 232,3 3%
EBITDA 140,6 168,1 n.m. 125,9 230,8 n.m.
Pre-tax profit for the period 134,1 123,7 -8% 115,8 106,6 -8%
Net profit/(loss) for the period 94,7 90,2 -5% 80,9 77,1 -5%
637
397
61158
13462
9M 19
Assets
Cash FleetAdvances for assets acquisition Customers and other receivablesOther fixed Assets Other Assets
322
16
324
197
127
150
316
9M 19
Liabilities-Equity
Equity Finance Lease
Operating Leases Bond
Other Long Term Liabilities Tickets Sold not flown
€ 1.450,6€ 1.450,6
Amounts in € mil.
22
Robust Balance Sheet Structure
Appendix
❑ An enduring partnership among five groups/partners1:Vassilakis, Laskaridis, Constantakopoulos, Ioannou and David families.
❑ Company’s shares are listed in the Athens Stock Exchange since 2007.
36,70%
30,91%
32,39%
Vassilakis family Pre-IPO shareholders Rest
1.Constantakopoulos Family: Costamare Shipping company and Real Estate development TEMES, Laskaridis Family: Lavinia Shipping, Real estate, Hotels, G. David Family: Coca
Cola Hellenic Bottling Company, Ioannou Family: Construction J&P, Real Estate, Hotels.
Working together
24
Aegean Olympic Air Aegean Aegean Olympic Air
49 - 4 45 -
- 8 - - 8
- 2 - - 2
- 2 - - 2
49 12 4 45 12
Airbus A320ceo family
Bombardier Dash 8-Q400
Bombardier Dash 8-100
Manufacturer/Model
ATR 42-600
Operator
Total
Finance Lease Operating Lease
25
Current Fleet
26
% of estimated
annual needs
Average hedged
rate
61% 1,19
50% 1,14
EURUSDCurrency
Needs Coverage
FY 2020
FY 2019
Forward contracts in US dollars (currency forwards & options)
% of estimated
annual needs
Average hedged
rate
76% 645
53% 622
FOB Med equivalent Jet priceCommodity
Needs Coverage
FY 2020
FY 2019
Commodity swaps (jet fuel swaps)
Managing exposure toreduce volatility onresults and target costcertainty.
Hedging Coverage
27
Consolidated resultsIn € millions
Jan – Dec
2017
Jan – Dec
2018Change
in %
Jan – Sep
2018
Jan – Sep
2019Change
in %
Revenue 1,127.6 1,187.4 5% 939,3 1.031,9 10%
EBITDAR 257.3 244.9 -5% 225,1 232,3 3%
EBITDA 119.8 111.4 -7% 125,9 230,8 83%
Pre-tax earnings 85.8 98.6 15% 115,8 106,6 -8%
Net earnings 60.4 67.9 13% 80,9 77,1 -5%
Total number of passengers (in
thousands) 13,217 13,971 6%
10.827 11.633 7%
Average number of passengers per
flight121 127 5%
126 129 2%
Load factor - Scheduled services
(RPK/ASK)83.2% 83.9% 0.7pp
83,6% 84,5% 0,9pp
Load factor - Scheduled services
(Pax/AVS)82.5% 83.2% 0.8pp
82,9% 83,9% 1,0pp
Average sector length (km) 905 915 1% 909 921 1%
RASK (Revenue per ASK, in € cents)6.9 7.0 2%
7,1 7,2 2%
Yield (Revenue per RPK, in € cents)8.2 8.3 1%
8,5 8,5 0%
CASK (EBT level, in € cents) 6,34 6,42 1% 6,2 6,5 4%
CASK (EBT level, in € cents) - excl. fuel
costs 5,11 4,99 -2% 4,9 5,0 3%
Aegean at a glance
28
Jan – Dec
2017
Jan – Dec
2018Change
in %
Jan – Sep
2018
Jan – Sep
2019Change
in %
Capacity
ASKs (in millions) 16,657 17,245 4% 13.347 14.438 8%
Total available seats (000) 16,082 16,847 5% 13.101 13.879 6%
Total Block Hours 178,229 181,686 2% 141.138 151.189 7%
Total Sectors Flown 108,977 109,825 1% 85.846 90.420 5%
Average capacity per flight 148 153 4% 153 154 1%
Average sector length (km) 905 915 1% 909 921 1%
Passengers (000)
By type of service :
Schedule passengers 12,724 13,467 6% 10.428 10.995 5%
Charter passengers 492 505 3% 399 638 60%
By network :
Domestic 5,903 6,122 4% 4.793 4.904 2%
International 7,314 7,849 7% 6.035 6.729 12%
Total number of passengers 13,217 13,971 6% 10.827 11.633 7%
RPKs (in millions) 13,851 14,435 4% 11.144 12.232 10%
Pax/flight 121 127 5% 126 129 2%
Load factor - Scheduled
(Pax/AVS) 82.5% 83.2% 0.8pp 82,9% 83,9% 1,0pp
Load factor - Scheduled
(RPK/ASK) 83.2% 83.9% 0.7pp 83,6% 84,5% 0,9pp
Group Operating figures
29
Consolidated results (in € mil.)
Jan – Dec
2017
Jan – Dec
2018Change
in %Jan - Sep
2018Jan - Sep
2019Change
in %
Revenue
Scheduled Services 963.4 1,014.9 5% 804,3 860,9 7%
Charter 54.6 51.6 -5% 41,4 67,0 62%
Other 109.7 120.9 10% 93,6 104,0 11%
Total revenue 1,127.6 1,187.4 5% 939,3 1.031,9 10%
Other operating income 14.0 17.5 25% 11,7 12,8 10%
Employee benefits (125.0) (130.0) 4% (100,3) (107,4) 7%
Aircraft fuel (204.5) (245.6) 20% (186,3) (217,1) 17%
Aircraft maintenance (153.8) (163.8) 7% (125,0) (140,3) 12%
Overflight expenses (65.7) (67.5) 3% (52,6) (55,9) 6%
Ground handling expenses (63.2) (65.9) 4% (51,1) (55,7) 9%
Airport charges (60.8) (64.0) 5% (48,8) (52,5) 8%
Catering expenses (29.4) (32.5) 11% (24,7) (27,8) 12%
Distribution expenses (84.1) (79.6) -5% (60,6) (66,8) 10%
Marketing & advertising expenses (15.6) (16.2) 4% (10,6) (12,8) 21%
Other operating expenses (82.3) (94.9) 15% (65,8) (76,1) 16%
EBITDAR 257.3 244.9 -5% 225,1 232,3 3%
EBITDAR margin 22.8% 20.6% 24,0% 22,5%
Aircraft leases (137.5) (133.6) -3% (99,2) (1,5) -99%
EBITDA 119.8 111.4 -7% 125,9 230,8 83%
Depreciation (19.4) (18.7) -4% (14,5) (108,9) 654%
EBIT 100.4 92.7 -8% 111,4 121,9 9%
EBIT margin 8.9% 7.8% 11,9% 11,8%
Financial results (14.6) 6.0 - 4,4 (15,3) -
EBT 85.8 98.6 15% 115,8 106,6 -8%
EBT margin 7.6% 8.3% 12,3% 10,3%
Income Tax (25.4) (30.7) 21% (34,9) (29,4) -16%
Net earnings / (loss) after tax 60.4 67.9 13% 80,9 77,1 -5%
Profit and Loss account
30
(in € mil.) December 18 September 19
Total fixed assets 255,1 593,1
Cash & equivalents 271,7 617,7
Financial assets available for sale 18,5 19,6
Other current assets 180,7 220,2
Total assets 725,9 1.450,6
Total equity 277,9 322,1
Finance lease liabilities 22,9 15,8
Operating Lease liabilities 0,0 323,8
Loans 0,0 196,8
Other Liabilities 425,1 592,1
Total equity and liabilities 725,9 1.450,6
Balance Sheet Aegean Group
31
(in € mil.) Jan – Dec 2018 Jan – Sep 2019
Net cash flows from operating activities 86 307
Net cash flows from investing activities -70 -18
Net cash flows from financing activities -49 52
Net (decrease)/ increase in cash and cash equivalents -33 340
Cash at the beginning of the period 301 272
Foreign exchange difference impact in cash 4 6
Cash at the end of the period 272 618
Cashflow Aegean Group
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Contact Information
https://en.about.aegeanair.com/investor-relations
https://www.youtube.com/user/aegeanairlinesvideo
Aegean Airlines Headquarters31, Viltanioti str., 14564,Kifissia, Greece Map
T: +30 2106261519T: +30 2106261660F: +30 210 6261900
www.aegeanair.com
https://www.facebook.com/aegeanairlines
https://www.instagram.com/aegeanairlines/
https://twitter.com/aegeanairlines
33
Disclaimer
Forward Looking Statements
Except for historical information, the statements made or information contained in this presentation are forward-looking in nature.These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objectivesand expectations with respect to future operations, products and services, and statements regarding future performance. As such,they are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the Company’s control,which could cause the actual future performance to differ materially from those referenced, projected or contemplated herein by anyforward-looking statement, including but not limited to the following: overall passenger traffic; the airline ticket pricing environment;the international expansion of our route network; seasonal fluctuations in passenger travel; aviation fuel prices; landing and navigationfee changes; changes in aircraft acquisition, leasing and other operating expenses; developments in government regulations and laborrelations; the cost of our ground handling operations; the future development of AIA, the Greek regional airports and the internationalairports; foreign currency fluctuations, in particular between the euro and the U.S. dollar; the progress of our code-shared andinterline arrangements; the availability of additional slots or landing rights at existing airports and the availability of new airports forexpansion; interest rate fluctuations; extraordinary events, such as accidents, terrorist attacks or threats of terrorist attacks, naturaldisasters and outbreaks of contagious diseases; the rates of taxes payable; and general economic conditions in Greece and theEuropean Union.
Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions,it can give no assurance that its expectations will be attained. Therefore, past performance and/or forward-looking statements are notto be treated as guarantees of future performance. The forward-looking statements are made as of the date of this presentation, andwe undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, futureevents or otherwise.
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