Air Berlin PLC 15 th June, 2016 Annual General Meeting 2016 London

Transcription

1 Air Berlin PLC 15 th June, 2016 Annual General Meeting 2016 London

2 Despite headwind, airberlin made good progress in 2015 RASK +3.7% Yield +2.0% Load Factor +0.7%pt Ancillary Revenues* +9.2% ASKs -5.4% Partnership Revenues +25% EAP Revenues +80% Significant improvement of 3.7 per cent in revenue per available seat kilometre (RASK), equivalent to EUR 125m EBIT Yield increased significantly by 2.0 per cent Load factor increased by 0.7 percentage points to 84.2 per cent Targeted investment in commercial tools and product increased revenue performance by 9.2 per cent Network optimisation led to a reduction in available seat kilometres of 5.4 per cent (capacity) Alliance and Partnership revenue increased by 25 per cent Etihad Airways Partners revenues increased by 80 per cent * Ancillary Revenue per Pax 2

3 Reported EBIT of EUR -307m heavily constrained by one offs Code share EUR -40m Hedging vs. Market EUR -200m Non-recurring EUR -92m Germany-UAE code share dispute Significant impact of uncertainty around future of code share with Etihad Airways dispute now definitively settled Q4 15 and Q1 16 bookings heavily impacted with limited ability to shift cost Hedging position Fuel upside completely eroded by FX downside vs Difference of EUR 200m vs. market due to hedging book in 2015 Unhedged airlines driving down prices and yields Non-recurring costs Finalisation of fleet harmonisation programme Restructuring and severances Additionally, the unfortunate geopolitical and terrorist events in Egypt, Turkey and Paris had a significant impact industry wide 3

4 1) Financial update

5 Operating cash flow improved significantly in 2015 Total revenue [ m.] EBITDAR & EBIT [ m.] Operating cash flow [ m.] -2% FY 2014 FY 2015 FY 2015 adj. 4, , % +24% % +30% +43% Total revenue EBITDAR EBIT Operating cash flow Positive yield and load factor development partially compensated ASK reduction of 5.4% Ancillary revenues strongly improved versus prior year Earnings in 2015 are impacted by restructuring effects and extraordinary effects that did not originate from operational business by EUR 92m Adjusted for restructuring and extraordinary period effects EBIT was EUR -215m Due to its hedging positions airberlin could only benefit to a limited extend on the positive development of the fuel price (difference of EUR 200m) Operating cash flow improved by EUR 112m EBIT contains non cash charges that do not affect operating cash flow Working capital improved year over year 5

6 Commercial KPIs improved in 2015 with yield increasing for the first time in four years Successful implementation of new commercial organisation and key initiatives Significant progress in the development of ancillary revenues Strong performance of scheduled flights balancing the challenges of the leisure segment Opportunity remains in optimising sales and distribution channel strategy FY 2014 FY % % 7,59 7,74 5, % 6, % 7,05 7, Average Fare ( ) 1 Yield/RPK ( c) 1 Ancillary Revenues per Passenger ( ) 1 R/ASK ( c) 2 (1) Based on management reporting definition (2) Total revenue per ASK 6

7 Total costs decrease but increase in CASK driven by strong USD, non-recurring items and restructuring provisions Despite total costs decreasing by 3.5% 2, CASK 2 increase by +1.9% mainly driven by the effects of capacity reduction Semi-fixed costs such as personnel and cost of aircraft ownership could not be reduced in line with ASK reduction Cost 1 per ASK [ c.] 4.0% 1.9% Structural increase in regulatory cost items (including navigation charges) Fuel Increase in airport charges, leasing and maintenance driven by stronger USD Airport charges Crew tariff agreement and slower than anticipated improvement in crew productivity drives increase of personnel expenses High one off costs required to create future platform Leasing & depreciation Navigation & Air transportation tax Personnel Completion of narrow body fleet harmonisation in 2016 Restructuring provisions to optimise crew bases, reducing both complexity and overheads Other incl. OOR FY FY 2015 adj 1.70 FY 2015 (1) Cost on EBIT level including other operating result (2) FY 2015 adj excluding other extraordinary out off period effects EUR -40m, cost related to the introduction of Single Narrow Body Fleet EUR -25m and restructuring cost EUR -26m (severances) (3) 2014 expenses are pro-forma adjusted to reflect the integration of third party personnel into AB Group in 2015 (EUR -39m previously part of other expenses) 7

8 Expanding our network through refocusing and partnerships Hub to Germany and Europe Close cooperation on North America routes Dusseldorf Berlin Los Angeles NEW: San Fransisco Chicago Fort Myers Miami NEW: Boston New York Abu Dhabi Beijing NEW: Havana Bangkok Phuket 147 destinations in 38 countries (incl. codeshare partner: 290 destinations) Leveraging global connectivity through Etihad Airways and oneworld 24% per cent growth to the US commenced in May through new routes and frequency increases: DUS San Francisco (5 weekly flights) DUS Boston (4 weekly flights) NEW DUS New York (+1), DUS Los Angeles (+1), DUS Fort Myers (+1) 19% growth at Dusseldorf Airport in Summer 2016 to support dual hub strategy NEW Gateway to Middle East, Australia & Africa Destinations operated by airberlin Destinations operated by Etihad Airways and Etihad Airways Partners Destinations operated by oneworld partners (codeshare) Sydney 8

9 Partnership in action the importance of commercial cooperation +25% +80% Other 273 Bdg. 307 Bdg % 101 oneworld 37% 53% EAP 2014 All Partnerships Revenue (EURm) Etihad Airways Partners Revenue (EURm) Consistent and significant growth in Partnership revenues Additional expansion with Etihad Airways Partners predominantly driven by the partnership with Alitalia since November 2014 Etihad Airways Partners have overtaken oneworld as the largest revenue generator by net worth 18 month focus has been on growing EAP partnerships whilst maintaining oneworld revenues 2016 will see expansion of oneworld and EAP partnerships 9

10 We intensify our cooperation with Alitalia on DACH Italy Germany and Italy are no. 3 and no. 4 largest markets in Europe ranked on passenger volumes New network cooperation with a blanket codeshare relationship between airberlin and Alitalia implemented in November 2014 Commercial agreement signed in April 2016 creating a compelling proposition from our Dusseldorf and Berlin hubs 25 per cent increased weekly frequencies including new routes and destinations Codeshare on 1,400+ flights a week; 91 different routes including 56 non-stop services; 750 weekly flights 10

11 Targeted investment in product and marketing A corporate vision cascaded into a powerful commercial and marketing strategy Taking the airberlin brand upmarket ( premium carrier ) Holistic concept across all customer touch points, on ground and in air Campaigns aligned with network focus Differentiated long-haul and short-haul products to ensure competitive relevance Strong focus on driving ancillary revenues with strategic partners Connectivity on all Leveraging mobile technology for Exclusive and more extensive buyon-board Excellent premium services in our wide-body aircraft sales and experience offer to drive ancillaries business class Präsentationskennung 11

12 2) Q

13 Q in line with expectations despite continuing market pressures Revenue per Available Seat Kilometre (RASK) and Yield remained stable while ASK significantly down Impacted significantly by damaging dispute over codeshare flights Protracted influence of geopolitical events Downward trend in touristic destinations Load Factor improvement of 0.2 percentage points Continuing improvement in asset utilisation from network optimisation Ancillary Revenues increased by 2 EUR per passenger Tangible impact of enhancement of customer proposition and system development Cost per Available Seat Kilometre (CASK) increased due to reduction in capacity (ASKs) Management continue to address the underlying cost base to create a sustainable future platform Fuel upside expected in Q3 and Q4; partially offset by negative FX movement 13

14 Despite headwinds, Net Result improved by 13% versus prior year Total revenue [ m.] EBITDAR & EBIT [ m.] Net Result [ m.] % Q Q % 7.7-8% +13% Total revenue EBITDAR EBIT Net result Decrease in revenue driven by capacity reduction of 7.2% Ancillary revenues strongly improved versus prior year Operational business improvement and lower fuel cost lead to positive EBITDAR development Negative EBIT development due to revenue decrease has been partially offset by management of cost Increased net result due to lower interest expense and currency & derivatives effects 14

15 Significant improvement of ancillary revenues Stable Revenue per ASK development Further negative impact of codeshare dispute and dip in tourism traffic due to geopolitical event that led to short term capacity shifts away from impacted areas Strong evolution of Ancillary Revenue offsets yield shortfall in a declining yield environment Q Q % % % % % 6.71 Average Fare ( ) Flight revenue Yield/RPK ( c) Flight revenue, Ancillary and other Revenue Yield/RPK ( c) Ancillary Revenues per Passenger ( ) 1 R/ASK ( c) 1 (1) Total revenue 15

16 CASK at constant FX down by 4% Total Cost [EURm] Cost per ASK [EURc] -10.9% -4.0% Fuel Airport charges Leasing & depreciation Navigation & Air transportation tax Personnel Other excl. OOR % % % Fuel 1.66 Airport charges 1.50 Leasing & 1.45 depreciation Navigation & Air transportation tax Personnel Other excl. OOR % Q Q Q1 constant FX Q Q Q1 constant FX Total costs are down by 5.9% or 10.9% on constant FX respectively while constant FX is down by 4.0% Increase in leasing & depreciation is primarily driven by the increase of leased versus owned aircraft and the ASK reduction The inability to release costs relating to capacity (breathing room) is also the driver for the increase in personnel and other operating expenses 16

17 3) Outlook

18 On track to deliver a stronger 2016 Network Dual hub and key city focus; simplified production New summer schedule will enhance revenue performance Promising bookings, especially for long-haul flights Partnerships Maximising both growth and margin opportunities Commercial Driving revenues New product drive; ancillary revenue performance significantly better Touristic remains weak but we expect improvement with trend towards late bookings Cost base Restructuring will see positive impact on costs in H2 A relentless focus on cost 18

19 Questions & Answers