Third Quarter 2004 Analyst presentation November, 2004

Transcription

1 Third quarter marginally positive despite large overcapacity Stabilized yield drop, but large overcapacity put pressure on load factors Group traffic revenues down 2% in Q3 Volume 56 Price -7 Third Quarter 24 Analyst presentation November, 24, -September Change Revenues EBITDAR Lease, depreciation & financial net EBT bef. cap gains *) *) Ex restructuring costs of 64 (96) Q1-16% Yield drop stabilized Q2-16% Q3-7% Large overcapacity => weaker load factor than expected Down 2,7 p.u for Scandinavian Airlines Still some negative price effect from jet fuel despite fuel surcharges Spanair with strong profitability Q3 28 Turnaround 25 according to plan Unit cost down 26% since beginning of 23 Overcapacity = > Launch of Capacity & Utilization Focus Revenue actions = > New European concept and active yield mgt. Group Scandinavian Airlines Operations Subsidiary & Affiliated Airlines Airline Support Airline Related Business Hotels 2 3 8% 6% 4% 2% % -2% -4% Large overcapacity in the market - Particularly on Swedish domestic and European routes Capacity development Stockholm-Gothenburg jan-3 mar-3 maj-3 jul-3 sep-3 nov-3 jan-4 mar-4 maj-4 jul-4 sep-4 Capacity development on Swedish domestic majors Stockholm-Gothenburg/Malmö/Umeå/Luleå 4% 4 3% 2% 1% % -1% -2% -3% Capacity jan-3 mar-3 maj-3 jul-3 sep-3 nov-3 jan-4 mar-4 maj-4 jul-4 sep-4 Estimated demand Number of seats on Swedish domestic majors up more than 2% since March vs last year Capacity 2-3 times demand on Stockholm - Gothenburg Yields and unit cost close to sustainable levels Yield and unit cost Illustrative Long term estimated yield Current yield Long term unit cost Current unit cost Cabin factor 75% 7% Overcapacity = > load factors lower than long term level 65% 6% Cabin factor 55% 5% Long term estimated cabin factor 45% 4% 4-jan 4-feb 4-mar 4-apr 4-maj 4-jun 4-jul 4-aug 4-sep 5 Three building blocks on the return to profitability Turnaround Structural cost savings Revenue actions Most ambitious structural change in the SAS Group ever New European concept Active yield Focus on reaching management competitive cost level on each traffic flow Selective price increases Full effect 25 according to plan Sales force 26% unit cost reduction since 23 (SK) management Capacity: no effect Improving yields Revenue stabilization Capacity: no effect Capacity & Utilization Focus Overcapacity in market Improved utilization enabled by new business structure Stop marginal routes and loss making feed Focus on competitive situation Reduction of 1 aircraft in Scandinavian Airlines More dynamic fleet allocation 4-5 net Capacity cost adjustments Capacity: Reduces capacity in Scandinavian Airlines with 4% 6

2 7 New European product launched on October 31 Overview The group brand positioning Economy snowflake & Economy Economy Flex Business A premium quality airline Business Economy Flex snowflake -- Economy -- Economy Flex Fast Track Business Fast Track With a substantial network Buy on Board Buy on Board Food & Beverage Lounge 2+2 seating Food & Beverage And attractive product offering No adv purchase No minimum stay No change/refund One Way Adv purchase 7d SU/3 nights No change/refund Return Full Flex Return Full Flex Return At competitive prices 8 9 growing in and out of Norway Cost savings more than offset yield decline and increased jet fuel costs Number of passengers increasing (3 more in September vs 23) Stable market share New price concepts one way pricing Braathens result before gains 349 New web site 2 nd most popular in Norway More than 3% SAS Braathens passengers book on Internet Braathens today one of few European Airlines delivering shareholder returns January September Change 24 vs. 23 3, 2, 1, 4,3 1,2,3 Market share Norway domestic 5% 45% 4% Braathens Jan-Sep % 3% Total revenues % EBITDAR % EBIT % 1% EBT % EBT, bef gains % Okt Nov Des Jan Feb Mar Apr Mai Juni Juli Aug Sep BU SK WF DY 1 Gunilla Berg CFO, -1, -,6-2, -4,6-3, -4, Yield Turnaround 25 Fuel Other including EBT before volume exceptionals 12

3 Quarterly results EBT bef gains, restructuring and exceptionals Q1 Q2 Q3 Q4 Q1 Q2 Q3 Group Mainline Airline Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels EBT before gains and exceptionals - Business area Q3 Jul-Sep Q3 January-September Business area 24 Change 24 Scandinavian Airlines Subsidiary & Aff. Airlines Airline Support Businesses Airline Related Businesses Hotels Group eliminations, other EBT, before gains & exceptionals Stable yield pressure as from June - Scandinavian Airlines Total yield change vs last year % -5% -1% -15% -2% -25% Jan Mar jul Sep Nov Jan Mar Sep Load factors under pressure in Q3 due to overcapacity in the marketplace Load factor change in p.u. Scandinavian Airlines Unit cost reduction of 26% since 23 Target unit cost reduction 25-4% Scandinavian Airlines cost situation on track to competitive level Current issue is over capacity in the market 1,1,9,8 Scandinavian Airlines 1 Unit cost down 26% since beginning of 23 Reduced high fuel prices partly offset by fuel charges Group Jan-Sep Q3 Fuel cost Volume -2-1 Currency Estimates fuel costs at current price, billion ,7 6,2 Hedging 5% Oct-Mar at 42 USD/MT including premium Group Effect Sep 24 Effect Dec 24 1 st charge EUR nd charge EUR rd charge EUR2 8 Total 45 1 Gross effect excluding volume effects -6 Jan Feb Mar Apr Jun jul Aug Sep,7 Q13 Q23 Q33 Q43 Q14 Q24 Q

4 19 SAS Group Turnaround 25 ahead of plan Key productivity ratios significantly improved Legal structure Total financial effect of implemented activities compared to plan Reduction of personnel % 81% % 64% Aircraft utilization (12 month roling) 8,5 8 7,5 7 6,5 6 5,5 5 Dec Jan Feb Mar Apr Jun jul Aug Sep Cabin, pilot utilization (12 month roling) Dec Jan Feb Mar Apr Jun jul Aug Sep The SAS Consortium is the main vehicle for assets, revenues and leasing * Cabin crew Pilots Plan Status Sep 24 Plan Status Sep 24 * To be moved to under SAS AB as from 25 To be implemented Implemented 2 21 Change to new IFRS rules in 25 Spanair contributes to Group s profitability in Q3 Financial instruments Market valuation of financial instrument Positive effect on equity Pensions No effect from IAS to IFRS Goodwill No amortization form 25 (if valuation equals market value) Positive effect on result 22 Jørgen Lindegaard CEO EBT before gains improved 37 vs 23 Jet fuel costs up 1 in Q3 volume adjusted One way prices on whole system The second player position provides a long lasting growth perspective Traffic up 7,5% in Q3 Yields down 3,2% in Q3 Unit cost down 12,2% in Jan-Sep Positive expectations for Jul-Sep Jan-Sep Total revenues EBITDAR EBIT EBT EBT bef. gains

5 25 Widerøe hit by weak summer performance and high jet fuel costs Blue1 good growth but currently weak profitability Impressive growth in AirBaltic and Estonian Air Volumes lower in the summer than expected Volumes back to normal in September Traffic up 7,3% in Q3 and 11,2% accumulated Yields down 8,6% Turnaround 25 proceeding according to plan 3 almost fully completed Accumulated unit cost down 5,4% - September January-September Total revenues EBITDAR EBIT EBT Blue1 s result disappointing but actions taken Traffic accumulated up 84,9% Yields down 27% in Q3 Code share agreement with Lufthansa as from October will improve cabin factor Jet fuel cost up 41 vs 23 Helsinki-Düsseldorf/Geneve closed down Turnaround 25 proceeding according to plan Unit cost down 17,9% -September January-September Total revenues EBITDAR EBIT EBT Regional member of Star Alliance The SAS Group owns 49% in Estonian Air and 47,2% in AirBaltic Number of passengers have increased by more than 4% during 24 State of the art cost efficiency level approximately 5% lower than west European network airlines Number of passengers AirBaltic Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Number of passengers Estonian Air Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Strong REVPAR from September confirms recovery in Q4 -September January-September Revenues Operating expensives EBITDA Adjusted EBITDA EBIT EBT REVPAR Strong recovery for REVPAR from September Revenues up 39% in Q3 driven by new units Turnaround well under way positive result expectations for 24 Number of rooms sold increased Price pressure reduced REVPAR up 6,4% for comparable units. Number of hotels in operation increased 11% (from 162 to 183) 32 new contracts in 24. Full year positive result expected Jan-1 Sept Jan-2 Sept Jan 3 Sept Jan4 Maj Sep 28 Incorporation of business units completed October 1, 24 From business units to limited companies Closer to local markets Improved accountability One further step towards increased transparency Transparency Accountability SAS Group structure 29 Competitiveness Independence Strong performance from Airline Support Businesses in Q3 Jan-Sep in Revenues ,7% ,8% ,9% EBITDA % 295 n.m 75 21% EBT % 192 n.m 23 13% 3

6 31 Sum up 9 months 24 Improved yields, but weaker load factors Record high fuel prices challenge for the industry Turnaround 25 according to plan Capacity & Utilization Focus initiated New commercial strategies to repossess initiative Launched October 31 Additional slides for further information Outlook remains unchanged 33 Other important events 3 rd Quarter 24 Vitalized product offer launched October 3 Economy Flex introduced Snowflake integrated with Scandinavian Airlines Offered on most European routes Study by COWI confirms SAS important role in Scandinavian infrastructure and society in brand Also confirms fierce competitive environment in Scandinavia Incorporation of Scandinavian Airlines in Denmark, Norway and Sweden SAS Group s strong liquid position and significant committed facilities Liquid Funds September Available Credit Facilites: Revolving Credit Facility (MEUR 4) 9 Aircraft Finance Lease Facility 1 3 Bi-lateral Facilities 1 6 Others 5 Total Available Facilities 4 3 Total Available Funds Program to release capital continues Available facilities 43 Utilized facilities 3 4 Total facilities 7 7 The SAS Group position as the 4th largest airline group in Europe retained SAS Group number 11 world wide

7 Blue1 regional member as from 31 October 24 Group has three members SAS Group has a large socio- economic importance SAS Group key objectives 4Coming report in November 24 4Scandinavia need a network carrier 4Competitive feature in Scandinavia as other European markets 4SAS Group responsible to return to profit Unit cost Competitive unit cost in each traffic flow at the same level as most competitive airline Unit cost for SK Down 3-35% vs. 22 CFROI 4 Governmental support helpful but not discriminative EBIT margin Implementation of new hubs proceeding according to plan Organization changes 4 Fleet allocation as from summer program 23 4 Administration as from August 23 4 Cabin crew in Q Legal entities as from October 4 Fully implemented in Q4 24 Advantages with new national airlines 4 More efficient and flexible units To serve the home market better 4 Reduced complexity 4 Agreements on local market levels Closer to the customers Group Scandinavian Airlines Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels 4 Average CFROI of at least 2%. Corresponds to approximately 1% EBIT-margin 39 The SAS Group new structure as from October 24 Transparency Accountability Competitiveness Independence Strategies going forward 4 Complete Turnaround 25 Reduce Scandinavian Airlines unit cost by 25-4% vs 22 Improve productivity significantly Independent hubs in Copenhagen, Oslo and Stockholm Complete final redundancies 4 Implement positive yield measures Yield management Jet fuel surcharge Fare adjustments 4 Commercial strategies Implemented October 31st Group Mainline Airline Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels 42

8 43 Group Revenue SAS Group objectives in the coming five year period are: To achive an average CFROI of at least 2% To increase the Group s share of the Northern European airline market For each unit to achieve its customer satisfaction, employee satisfaction and environmental impact objectives For airline operations to achieve their flight safety targets Consolidated balance sheet Revenue development per business area -September January-September Business area vs. LY vs. LY Scandinavian Airlines -4,1% -8,7% Subsidiary & Aff. Airlines 6,1% 2,1% Airline Support Businesses -,8% -1,6% Airline Related Businesses* -37,7% -39,% Hotels 39,1% 24,2% SAS Group 3,4% -1,8% Group revenues and EBIT-margin development Revenues Q 23 2Q 23 3Q 23 4Q 23 1Q 24 2Q 24 3Q 24 EBIT-margin 4,% 2,%,% -2,% -4,% -6,% -8,% -1,% -12,% -14,% -16,% * In December 23 Scandinavian IT Group was sold Revenues EBIT-margin Group Mainline Airline Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels SAS Group revenue development Revenue seasonality pattern Group results have improved since second quarter 23 % vs. Last year Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Revenue in Q3 24 slightly exceeds previous year higher volumes Reduced yield decline EBT change before gains and exceptionals vs. Last year Q2 Q3 Q4 Q1 Q2 Q vs vs vs 23 jan feb mar apr maj jun jul aug sep okt nov dec -1 4 Group Mainline Airline Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels Group Mainline Airline Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels 48

9 49 SAS Group EBITDAR and CFROI SAS Group Quarterly EBT EBITDAR development, January-September Revenue ,8% EBITDAR ,7% EBITDAR-margin 7,4% 6,7% +,7 p.p. CFROI 8% 7% +1 p.p. EBT bef gains million Q1 Q2 Q3 Q4 EBITDAR Q1 Q2 Q3 Q EBITDAR in Q3 24 was (1 737) EBITDAR Scandin Airl. 43 Braathens 287 Spanair 618 Widerøe 69 Blue Group Scandinavian Airlines Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels 5 Group Scandinavian Airlines Operations Subsidiary & Affiliated Airlines Airline Support Airline Related Business Hotels 51 January-September affected negatively by 9 higher jet fuel costs Current spot price 84% higher than 23 SAS Group has 5% hedge in place for October 24-March 25 and 1% Apr-Sep 25 3 rd fuel charge implemented November Q2 and Q Record high jet fuel prices -Average spot rate 64% higher in Q3 vs 23 Average market prices: USD/MT USD/MT USD/MT USD/MT Q USD/MT Q USD/MT Q USD/MT Q USD/MT Q USD/MT Q USD/MT Q USD/MT

10 55 Unit cost SEK/ASK Scandinavian Airlines to improve efficiency and reach close to level of LCC Turnaround 25 business follow up a complement to existing follow up systems Decided and under implementation in Turnaround 25 App. 1,4 App. 1,25 App.,85 App.,75-,85 AEA Scandinavian Airlines in 22/3 With full effect from Turnaround 25, Scandinavian Airlines will reach unit cost in the same level as Low Cost Carriers given same stage length Scandinavian Airlines after full Turnaround 25 Follow up status negotiations Follow up FTE reductions FTE Follow up Steering of units on bottom line and include all effects of Turnaround 25 Follow up through normal reporting Budget and Business Plans Steering of businesses and business units Follow up activity KPI Follow up of existing KPIs KPIs on unit level task force and activity level ,1 7,5 1, 1,6 1,8 14, Current position appr. 1, SEK/ASK LCC 45 km Stage length Follow up of activities vs plan 2 Overhead functions SK/group wide Scandinavian Airlines (incl BU) SGS STS Subsidiary & Affiliated Airlines Total Distribution of cost reductions in Turnaround 25 by cost category Number of personnel development for the SAS Group Block hours for Group Airlines in % 6% 5% 49% Majority owned Airlines Jan- Sep 24 Air craft/day Pilots/year Cabin/year Scandinavian Airlines 8, Spanair 8, Braathens 8, Widerøe Blue1 6,7 7, % 31 11% Personnel Ground Handling & Technical Aircraft lease Other Sales Inflight IT 3 JAN-2 MAR MAJ JUL SEP NOV JAN-3 Actual MAR MAJ JUL SEP NOV JAN-4 MAR MAJ Forecast JUL SEP NOV

11 61 Turnaround 25 amounting to 2 8 for Subsidiary Airlines and Hotels Internet check in has doubled but from low levels Initiated in April 23 Total measures of at least 1 7 Most of measures implemented in 24 Target to increase Self Service check in to 6% in 25 Internet check low, but has doubled in 24 4% 35% 3% 25% 2% Business areas Spanair Widerøe Blue1 Hotels 15% 1% 5% % Automat Internet 62 Scandinavian Airlines Quarterly EBITDAR development Scandinavian Airlines key airline profitability drivers EBITDAR, Scandinavian Airlines vs 23 -September Traffic (RPK) up 2,6% Cabin Factor down 2,7 p.u. Yields (currency adjusted) down 7,% Operational unit costs down 7,1% -5 Q1 Q2 Q3 Q4* Scandinavian Airlines

12 Operating expenses continue to decrease September Scandinavian Airlines aircraft utilization up 13,3% in January-September vs last year Productivity targets, Scandinavian Airlines Operating revenue ,1% Personnel expenses ,2% Sales & distribution ,6% Fuel ,3% Government user fees ,2% Catering ,3% Handling costs ,9% Technical aircraft maintenance ,2% Data & telecommunication costs ,1% Other costs ,6% Operating expenses ,6% EBITDAR EBIT EBT Jan-Sep 24 Target Aircraft, block hours/day 8,3 9 Pilots, block hours/year Cabin, block hours/year Aircraft s turnaround 3 to 4 Will significantly contribute to Turnaround Group Mainline Airline Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels 69 Scandinavian Airlines Development of number of employees Employees FTE: Scandinavian Airlines JAN-2 MAR MAJ JUL SEP NOV JAN-3 MAR MAJ JUL SEP NOV JAN-4 MAR MAJ JUL SEP Actual Forecast 7 Strong development on North Atlantic %, RPK vs. Last year %, Cabin factor SAS Week January March September November January March September November January March September AEA General improved load factors Significantly higher load factor than AEA Oslo-New York ceased in March 23 Traffic in Jan-Sep 24: European airlines (AEA) traffic up 9,3% SAS traffic up 3,1% 71 Asian traffic improved but capacity in the market has increased significantly %, RPK vs. Last year %, Cabin factor Week SAS January March September November January March September November January March September AEA Positive mix but capacity to many of SAS destinations has increased more than the demand Reduced capacity on Bangkok/Singapore Shanghai 3/week as from March 28th Operate 6/week as from November Traffic in Jan-Sep 24: AEA traffic up 22,2% SAS traffic down 17,9%

13 Increasing traffic on European routes ECA European cooperation agreement %, RPK vs. Last year %, Cabin factor SAS January March September November January March September November January March September AEA Traffic Jan-Sep 24: AEA traffic up 8,1% SAS traffic up 6,9% 74 Tri-party Joint Venture agreement with BMI, Lufthansa and SAS signed November 9, 1999 In effect from January 1, 2 Main scope: To integrate the parties scheduled pass. transport to/ from London/ Manchester Negative result effect 22: 418 (335) Negative result effect 23: 244 Negative result effect first quarter 24: 71 Positive effect second quarter 24: 45 Negative effect third quarter 24: 62 Subsidiary & Affiliated Airlines Income for Subsidiary & Affiliated Airlines improved Income for Subsidiary & Affiliated Airlines stable Improved result in Subsidiary Airlines, January-September Change Revenues ,1% Operating expansives ,5% EBITDAR ,2% Lease ,2% EBITDA ,8% Depreciation ,% Income from sales/affiliated n.m. EBIT % EBT bef. cap gains n.m. EBT incl. gains n.m., -September Change Revenues ,1% Operating expenses ,9% EBITDAR ,2% Lease ,4% EBITDA ,9% Depreciation ,4% Income from sales/affiliated n.m. EBIT ,4% EBT bef. cap gains ,9% EBT incl. gains ,5% Jan-Sep in Revenues ,8% ,7% ,8% 97 32% EBITDAR 981 7,2% 91 28% 242-5,5% 11-85% EBT 59 n.m % 44 47% -112 n.m

14 79 Spanair improved result by 84 Jan-Sep vs 23 Spanair contributes to Group s profitability Braathens has significantly improved its result, but weaker in Q3 -September January-September Revenues Operating expenses EBITDAR EBITDA EBIT EBT bef. cap gains EBT incl. gains The twin track strategy with full service and low cost model starting to make results Earnings before taxes and one offs improved by 84 for Jan-Sep Unit cost down 12,2%. Jet fuel costs up 271 The underdog position provides a long lasting growth perspective Combining excellent cost and quality/service performance with an innovative and agressive commercial model, will provide very good results and value for the SAS Group over the coming years September January-September Revenues Operating expenses EBITDAR EBITDA EBIT EBT bef. cap gains EBT incl. gains Stable result in in Widerøe, but Q3 hit by lower volumes Lower yields and high fuel costs reduces Blue1 s result -September January-September Revenues Operating expenses EBITDAR EBITDA EBIT EBT bef. cap gains EBT incl. gains September January-September Revenues Operating expenses EBITDAR EBITDA EBIT EBT bef. cap gains EBT incl. gains Group Scandinavian Airlines Operation Subsidiary & Affiliated Airlines Airline Support Airline Related Business Hotels 83 Airline Support Businesses

15 85 Result for Airline Support Businesses significantly improved Statement of income Airline Related Businesses, January-September Change Revenues ,6% Operating expenses ,1% EBITDA % EBIT n.m EBT n.m, January-September Change Revenues % Operating expenses % EBITDA % EBIT % EBT ,7% Airline Related Businesses 87 Scandinavian IT Group sold in December 23 and included in the 23 figures Flight Academy and Jetpak on track Weak result from SAS Trading Avinor has discontinued negotiations with SAS Trading tax free operations in Norway Jan-Sep in SAS Trading Revenues ,3% 384 4,3% 338 1,8% EBITDA -5 n.m 12 24% 28 22% EBT -23 n.m % 12-29% A definite agreement is expected in August 24 SAS Trading s current agreement will expire in December 24 New agreement valid for seven years starting in 25 The agreement is expected to have a turnover of SEK 1 billion Current agreements stands for appr. 2/3 of SAS Trading s total revenue SAS Trading has in total 38 duty free shops in Scandinavia, Poland and the Baltic states of which 6 in Norway

16 91 Hotels third quarter result improved by 34 as REVPAR has stabilized Improved occupancy Unit cost has been sharply reduced -September January-September Revenues Operating expenses EBITDA Change Vs. Last year Occupancy factor, including managed hotels 1% 5% % 12 months rolling value Adjusted EBITDA % EBIT % EBT % Jan3 Feb Mar Apr Maj Jun Jul Aug Sep Okt Nov Dec Jan4 Feb Mar Apr Jun Jul Aug Sep Jan-2 Mar Maj Jul Sep Nov Jan 3 Mar Maj Jul Sep Unit cost calculated as Costs/number of rooms Nov Jan4 Mar Maj Jul Sep REVPAR has stabilized Balance Sheet 3 Sep 4 3 Sep 3 31 Dec 3 REVPAR (EUR) 12 months rolling value Liquid funds Aircraft Other assets Total assets Financial update Operating liabilities Interest-bearing liabilities Deferred tax Minority interests Equity Total liabilities and equity Jan-1 Mar Sept Nov Jan-2 Mar Sept Nov Jan 3 Mar Sept Nov Jan4 Mar Maj Jul Sep Nov Financial net debt Group Mainline Airline Operations Subsidiary & Affiliated Airlines Airline Support Business Airline Related Business Hotels 95 96

17 97 SAS Group s limited aircraft Capex Firm Aircraft Orders Total Oct-Dec Airbus A32/ Boeing Number of aircraft CAPEX (MUSD) SAS Group s Capex Holiday F 25F 26F 27F 98 Oct-dec Clear Targets to Reduce Indebtedness - Long-term targets to be realised Key figures Sep 4 Dec3 Target Equity/assets ratio (solidity) 2% 22% >3% Financial net debt/ equity 157% 137% <5% Fin. net debt+7*oplease/ equity 314% 292% <1% 99 Targets will be reached by: Turnaround measures Capital Release: Aircraft Surplus and phase-outs Other Assets (Properties, non-core subsidiaries etc) Amortization profile of interest bearing liabilities Development of financial net debt SAS Group - Development and break down of Financial Net Debt () Difference Cash Other interest bearing assets Interest bearing liabilities > 213 Oct-dec Financial Net debt

18 13 SAS Group - Development and break down of Financial Net Debt Financial Net Debt / Equity Ratio SAS Group Equity / Assets Ratio () Difference Cash Other interest bearing assets Interest bearing liabilities Financial Net debt ,5 2,3 2, 1,8 1,5 1,3 1,,8,5,3, % 45 % 4 % 35 % 3 % 25 % 2 % 15 % 1 % 5 % % Adjusted Net Debt / Equity SAS Group Financial Net January September 24 Gearing ratios Net Debt+7*Op lease / Equity () Difference Leverage Ratios 4% 35% 3% 25% Interest net and others Exchange rate differences Financial net % 29% 24% 19% 2% Average financial net debt % 15 % 1 % 5% % Q1-24 Q3 24 In % p.a. of average financial net debt: Interest net -5,1% -4,7% -,4 p.u. Exchange rate differences -,2% +2,2% -2,4 p.u. Financial net -5,3% -2,5% -2,8 p.u. 9% 4% -1% dec-98 dec-99 dec- dec-1 Dec-2 mar-3 jun-3 sep-3 3-dec 4-mar 4-jun 4-sep Net Debt / Equity Fin Net Debt / Equity Fin. Net Debt + 7*Op lease / Equity

19 19 Cash flow statement Q3 September, Cash flow from operations Change in working capital Net financing from operations Investments, advance payments Acquisition/sale of subsidiaries (net) -19 Sales of fixed assets, etc Financing deficit/surplus Changes in external financing, net Changes in liquid assets acc. to balance sheet Improved cash flow but no positive change in liquid assets as surplus is amortized January September, Cash flow from operations Change in working capital Net financing from operations Investments, advance payments Acquisition/sale of subsidiaries (net) Sales of fixed assets, etc Financing deficit/surplus Changes in external financing, net Changes in liquid assets acc. to balance sheet Sum Up Credit Data Strong liquidity of 7 67 Substantial Committed credit facilities of 4 3 Limited CAPEX going forward Young aircraft fleet Additional sources of capital Turnaround 25 program on track with union agreements secured APPENDICES Traffic Data Yield Unit cost Fleet Financial key figures Yield development stabilized, but load factors weak on European flights and Swedish domestic Traffic improves, but less than expected Group traffic up 5,8% in Q3 Group passenger load factor down by 1,3 p.u. Passenger- Seat capacity Cabin- Q3 traffic (RPK) (ASK) factor SAS Group Total 5,8% 7,9% 67,8% Intercontinental 1,5% 1,9% Europe 1,5% 16,9% Domestic and 1,2% -1,3% Intrascandinavian Capacity (ASK) outlook 24 vs. 23 Scandinavian Airlines 5% Spanair 13% Braathens 4-5% Widerøe 9% Blue1 6% Total SAS Group 7%

20 115 Yield development 24 vs 23 Scandinavian Airline Total Scheduled Jul-Sep Change Yield (öre/rpk) 96,6 15,2-8,1% Currency adj. yield 96,6 14, -7,% Jan-Sep Change Yield (öre/rpk) 12,3 12,6-15,2% Currency adj. yield 12,3 117,6-13,% Yield development 24 vs 23 Yield, local currency -September January-September -3,2% -7,8% -8,8% -1,8% -8,6% -8,6% -27,% -28,9% Unit Cost January-September 24 vs 23 Share of Cost analysis Var% total var % Personnel ,1% -4,3% Fuel ,9% 2,4% Gov. Charges ,4%,% Selling cost ,5% -,6% Ground Services ,6% -,9% Technical ,1% -2,1% Other operating costs ,5% -5,2% Total operating expenses ,5% -1,7% Aircraft costs ,3% -1,1% Adjusted EBIT ,8% -11,8% Volume = average increase in ASK: +5,5% Unit Cost -September 24 vs 23 Sharp reduction in unit cost continues in Q3 Yield Development Share of Cost analysis Q3 23 Q3 24 Var% total var % Personnel ,2% -3,7% Fuel ,1% 4,2% Gov. Charges ,1%,1% Selling cost ,% -,4% Ground Services ,8% -,6% Technical ,7% -2,2% Other operating costs ,7% -4,% Total operating expenses ,1% -6,6% Aircraft costs ,9% -1,2% Adjusted EBIT ,8% -7,8% Index last year, EBITDAR level (currency adjusted) Scandinavian Airlines 1% 5% % -5% -1% -15% -2% 1st Q 3rd Q 1st Q 3rd Q 1st Q 3rd Q st Q 24 3rd Q 24 Unit cost down 11,8% in 23 Unit cost down 14,7% in Q1 24 Unit cost down 12,3% in Q2 24 Unit cost down 7,1% in Q3 24 Adjusted for fuel price unit cost was down 11,3% in Q3 January-September (currency adjusted),% -2,% -4,% -6,% -8,% -1,% -12,% -14,% -16,% -18,% -2,% September (currency adjusted),% -2,% -4,% -6,% -8,% -1,% -12,% -14,% -16,% -18,% -2,% Volume = average increase in ASK: +6,7%

21 121 Yield development Passenger Yield 3 rd Quarter 24 vs 23 Passenger Yield January-September % Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Yields down 7,% in 3rd Quarter 24 Reduction reduced because of jet fuel surcharge, fewer price campaigns and fmore active yield management Class mix still negative Nominal Currency Adjusted Route Sector yield effect yield Scandinavian Airline Intercontinental Europe Intrascandinavian Denmark Norway Sweden Nominal Currency Adjusted Route Sector yield effect yield Scandinavian Airline Intercontinental Europe Intrascandinavian Denmark Norway Sweden vs vs vs Key airline profitability drivers 24 vs 23 Revenue Pressure partly offset by larger volumes Revenue analysis third Quarter Scandinavian Airlines January-September Traffic growth (RPK) up 6,4% Cabin Factor up,6 p.u. Yields down 13,% Unit costs incl A/C cost down 11,8% -September Traffic growth (RPK) up 2,6% Cabin Factor down 2,7 p.u. Yields down 7,% Unit costs incl A/C cost down 7,8% January-September 24 Revenues ,8% Volume +6,4% Yields -13,% Currency -2,5% -September 24 Revenues 6 6-5,7% Volume +2,6% Yields -7,% Currency -1,2%

22 127 Passenger load factor % 68% 67% 66% 65% 64% Moving 12 months values 63% DEC94 DEC95 DEC96 DEC97 DEC98 DEC99 DEC DEC1 DEC2 DEC3 Weaker USD offset by increased yield pressure Positive effect on operation costs in January-September by 69 Weak USD => increased yield pressure Currency Effects SAS Group January-September 24 vs 23 Jan-Sep Total revenues Total costs Forward cover costs & working cap Income before depr. +31 Financial items -351 Income before tax Currency Effects SAS Group -September 24 vs 23 Currency Effects SAS Group January-September 24 vs 23 Currency Effects SAS Group -September 24 vs 23 Jul-Sep Total revenues -188 Total costs +321 Forward cover costs & working cap. -68 Income before depr. +65 Financial items +1 Income before tax +75 Total revenues & costs: (Total +495 ) Major approx. effects: USD +69 DKK +8 NOK -156 EUR -4 Asian curr. -45 All others +2 Forward cover costs: (Total -184 ) Working capital: (Total 1 ) Financial items: (Total -351 ) Grand total -41 Total revenues & costs: (Total +133 ) Major approx. effects: USD +16 DKK +2 NOK -25 EUR -3 Asian curr. -1 All others +9 Forward cover costs: (Total -44 ) Working capital: (Total -24 ) Financial items: (Total +1 ) Grand total

23 133 Currency distribution in the SAS Group 23 NOK 33% Revenues SEK 19% GBP 4% USD 8% Others 5% DKK 9% EUR 22% SEK 17% NOK 25% Expenses GBP 2% USD 25% Others 1% EUR 15% DKK 15% SAS Group fleet as of Sep 3, 24 Leased Out Aircraft Type Owned Leased In Total On Order Airbus A34/A Airbus A32/A Boeing Boeing Boeing Douglas MD-81/82/83/ Douglas MD Avro RJ-85/1 9 9 Fokker F Fokker F dehavilland Q SAAB Total Company Owned Leased Total Leased On Order In Out SAS Spanair Braathens Wideroe Blue Total SAS share Development of Market capitalization SAS share price vs. Peers 24 Number of traded SAS shares has increased jun-4 feb-4 okt-3 jun-3 feb-3 okt-2 jun-2 feb-2 okt-1 jun-1 feb-1 okt- jun- feb- okt-99 jun-99 feb-99 12, 11, 1, 9, 8, SAS Market Capitalization vs. European Peers measured in SEK (December 31, 23 - September 3 24) 7, 31-dec jan feb mar- 4 3-apr maj- 4 3-jun jul aug- 4 3-sep- 4 79,4 78, January Number of shares traded in SAS per month February March April June August September October November December January February March April June August September Index Peers Index SAS * Peers: Alitalia, Air France, British Airways, Finnair, KLM, Lufthansa &Ryanair 23 vs vs

24 139 Increased number of traded SAS shares at Stockholm Stock Exchange 9 Number of shares traded in Stockholm per month 6 3 January February March April 24 vs 23 June August September