FINNAIR GROUP FINANCIAL STATEMENT 1 JANUARY - 31 DECEMBER 2007
Strong cash flow and solid balance sheet facilitate future investments
Summary of 2007 key figures
- Turnover rose 9.6 per cent to 2,180.5 million euros (1989.6); turnover,
excluding impact of FlyNordic, sold in July, rose 12.2%
- Passenger traffic grew 6.6% from the previous year, passenger load factor rose
0.4 percentage points to 75.5% (75.1%)
- Unit revenues from flight operations fell by 1.9%, unit costs fell by 5.4%
- Operating profit was 141.5 million euros (operating loss 10.8 million euros).
- Operational result, i.e. EBIT excluding capital gains, non-recurring
arrangement expenses and changes in the fair value of derivatives, was 96.6
million euros (11.2 million) i.e 4.4% of turnover
- Result before taxes was 138.9 million euros (14.7 million loss).
- Gearing at the end of the year was -22.5% (7.1%) and gearing adjusted for
leasing liabilities was 35.1% (112.8%)
- Balance sheet cash and cash equivalents at the end of the year totalled 540.1
million euros (294.3 million)
- Equity ratio 47.0% (37.2%)
- Equity per share 7.70 euros (6.77)
- Earnings per share 1.04 euros (-0.14)
- Return on capital employed 14.2% (-0.1%)
Comparisons of key figures have been made with 2006 figures, which include
results for FlyNordic. Figures for 2006 are presented in brackets after the 2007
figures.
The financial statement's traffic performance comparison figures are actual
traffic performance figures from 2006, whilst in order to facilitate comparison
the traffic performance figures of FlyNordic, sold at the end in July 2007, have
been eliminated from the monthly published traffic figures for the period
July-September 2006.
President and CEO Jukka Hienonen on the annual result:
Our hard work last year delivered a good result that we are proud of. During
2006 we laid a solid foundation for the improvement of profitability and the
price was evident in the result as substantial one-off cost items. We entered
2007 in good shape and Finnair's profitability improved in every quarter. The
generally lacklustre, or even loss-making, final quarter was relatively speaking
the best of all.
We filled our aircraft with passengers and cargo. Load factors were at record
highs, even though we increased capacity considerably. We worked really hard in
the domestic market as well as in Europe and Asia. From the late summer and
early autumn there was downward pressure on average prices due to new route
openings, but the situation recovered towards the end of the year.
The price of oil reached a record high at the end of the year, crossing the 100
dollar a barrel mark. The euro-dollar exchange rate lightened fuel costs,
together with other dollar-denominated expenses. Fuel costs will remain high and
we will adjust our competitiveness accordingly.
We will focus in future on ensuring that our fleet operates better in our new,
more demanding operating model. The complexity of Europe-Asia traffic is more
challenging than managing local traffic. We will seek to maintain our place
among the Europe's most punctual network carriers.
Finnair's demand situation is currently good, both in leisure and scheduled
traffic. The solid result shows that Finnair is in good shape, but further
guidance in the present uncertain world economy would be too adventurous.
Market and General Review
2007 was a year of profitable growth in the Finnair Group. Finnair traffic grew
clearly more strongly than the European average and the company's profitability
improved significantly.
Passenger kilometres of member airlines of the Association of European airlines
AEA grew on average by five per cent in 2007. The biggest growth in passenger
numbers occurred in European internal traffic as well as on medium-haul flights
to destinations outside Europe.
The focus of growth in long-haul traffic was traffic between Europe and South
America. In Asian traffic, European airlines' capacity was at the 2006 level.
Passenger numbers rose by 0.5 million, of which around half was an increase
brought by growth in Finnair's Asian traffic.
In Europe-Asia traffic Finnair is among the ten most significant operators.
Finnair's market share is fourth biggest among European airlines in Europe-Asia
traffic. Finnair's objective is to continue growth to Asian destinations and its
vision is to become the airline of choice for long-haul travel in the northern
hemisphere.
Last year, Finnair carried more than 1.1 million passengers in Asian traffic.
Asian traffic growth was more than 30 per cent from the previous year. Scheduled
passenger traffic overall grew by nearly 20 per cent, and including leisure
flights Finnair's traffic performance grew by 13 per cent.
Capacity was increased by acquiring two long-haul Airbus A340 aircraft in June.
The long-haul traffic fleet modernisation is proceeding on schedule. This year,
two new Airbus wide-bodied aircraft will join Finnair's fleet, marking the
beginning of the Boeing MD-11 aircraft replacement investments. Five new
100-seat Embraer 190 jet aircraft were acquired for European traffic.
To finance the fleet investment programme, a 248 million euro share issue
directed at existing shareholders was arranged in November-December.
Unit revenues for Finnair's air traffic fell due to a change of traffic
structure. Unit revenues were also burdened by new route openings that took
place in the summer and a capacity increase in Europe-Asia traffic, which led to
flights being sold with more aggressive pricing. Towards the end of 2007, the
fall in unit revenues levelled off as expected.
Despite record fuel prices, unit costs for air traffic have continued to fall in
line with targets and more strongly than unit revenues, which has improved the
profitability of air traffic. Key factors in the decline of unit costs were more
efficient fleet utilisation and an improvement in staff productivity.
In terms of functions supporting air traffic, significant cost savings have been
achieved, for example, in Finnair Technical Services, where operational
productivity has been improved through a competitiveness project. Costs of
ground handling activity rose from 2006, particularly due to the start-up of
operations in Norway. In the final quarter of last year, ground handling
operations in Norway and Sweden were sold.
The efficiency programme initiated in May 2006, which aims to cut costs by 80
million euros per year, has proceeded according to plan. About 50 million euros
of the programme's impact is evident in the 2007 result, weighted toward the
second half of the year. The full impact on profit will be obtained in 2008.
Of seven collective employment agreements, six were renewed in October-November.
Negotiations to renew the collective employment agreement of pilots, which ends
in the spring, are under way.
The punctuality of European airlines fell last year. The punctuality of
Finnair's flights last year was also lower than the previous year. Last summer,
delays were caused by increased traffic in relation to the capacity of
Helsinki-Vantaa Airport. The number of delayed flights in December was also
exceptionally high. In terms of baggage, problems were caused, among other
things, by the perceived terrorist threat in the UK, which overextended baggage
streams at European airports.
Air cargo traffic on Finnair's Asian flights grew due to an increase in
capacity. Average prices fell, particularly on the Scandinavian market, due to
overcapacity after Asian companies opened cargo routes from Sweden. In the
latter half of the year, cargo demand increased and the fall in average prices
levelled off.
The agreement made in July on the sale of Finnair's Swedish subsidiary FlyNordic
to Norwegian Air Shuttle was finalised in the autumn. As a result of the deal,
Finnair acquired five per cent of Norwegian's shares and an option to increase
its ownership to ten per cent. In the third quarter, a non-recurring item
improving the operating profit by around 14 million euros was recognised for the
deal. In addition, deepening of cooperation between Finnair and Norwegian was
agreed.
The operations of the Estonian subsidiary Aero were discontinued at the
beginning of 2008 and all seven ATR 72 turbo-prop aircraft were sold. At the
same time, this marked the end of Finnair's propeller traffic, which had
continued uninterrupted since 1924.
The Group's package tour operator, Aurinkomatkat-Suntours expanded last year
with company acquisitions in the Baltic states and Russia.
Financial Result, 1 October - 31 December 2007
Turnover rose in the final quarter by 13.9 per cent to 568.7 million euros
(499.3 million). The Group's operational result, i.e. EBIT excluding capital
gains, non-recurring arrangement expenses and changes in the fair value of
derivatives, improved by nearly 50 million euros to 24.4 million euros (24.4
million loss). Adjusted operating margin was 4.3 per cent (-4.9%). The result
before taxes was a profit of 35.2 million euros (26.3 million loss). Changes in
the fair value of derivatives improved the final quarter result by 0.2 million
euros, but this has no effect on cash flow.
In October-December, Finnair's passenger traffic capacity grew 14.1 per cent and
revenue passenger kilometres by 17.5 per cent; Asian traffic grew 37.7 per cent.
Passenger load factor for all traffic rose by 2.2 percentage points from the
previous year to 74.4 per cent. The quantity of cargo carried grew by 13.1 per
cent.
Due to growth in long-haul traffic, total unit revenues per passenger kilometre
in scheduled passenger and leisure traffic fell by 3.7 per cent. FlyNordic
eliminated unit revenues declined 1.2 per cent. Yield per passenger rose by 9.9
per cent. Unit revenues per tonne kilometre for cargo traffic declined by 3.7
per cent. Weighted unit revenues for passenger and cargo traffic fell by 3.1 per
cent.
Euro-denominated operating costs rose during the period by 4.3 per cent. Unit
costs for flight operations fell by 7.9 per cent. Fuel costs rose by 16.1 per
cent in the final quarter. Excluding fuel costs, unit costs fell by 10.8 per
cent.
Personnel expenses rose by 14.1 per cent partly due to incentive bonus
provisions made as a result of a significant improvement in profit, with
recognitions weighted towards the final quarter.
Profitability improved in all business areas compared with the final quarter of
2006. The final quarter of the year is general less active than the middle
quarters but, due to the 80 million euros efficiency programme implemented in
Finnair, profitability improved towards year end. The profitability difference
is partly due to the fact that the comparison year's result was burdened by an
illegal strike by cabin staff as well as low utilisation of the Aircraft Heavy
Maintenance unit in the final quarter of 2006. A significant proportion of
Finnair Cargo's full-year profit arose specifically in October-December.
Financial Result, 1 January - 31 December 2007
Turnover rose 9.6 per cent to 2,180.5 million euros (1989.6 million). The
Group's operational result, i.e. EBIT excluding capital gains, changes in the
fair value of derivatives and arrangement expenses, rose to 96.6 million euros
(11.2 million). Adjusted operating margin was 4.4 per cent (0.6). The result
before taxes was a profit of 138.9 million euros (14.7 million loss). Changes in
the fair value of derivatives improved the result for the full year by 14.5
million euros, but this has no effect on cash flow.
In 2007, Finnair's passenger traffic capacity grew 12.7 per cent and revenue
passenger kilometres by 13.3 per cent; Asian traffic grew 32.6 per cent. In
European traffic, revenue passenger kilometres grew more modestly due to the
sale of FlyNordic in July. In the second half of the year, FlyNordic was no
longer included in the Finnair Group's traffic performance figure. Passenger
load factor rose 0.4 percentage points from the previous year to 75.5 per cent.
The amount of cargo carried grew by 5.2 per cent.
Due to growth in long-haul traffic, total unit revenues per passenger kilometre
in scheduled passenger and leisure traffic fell by two per cent. FlyNordic
eliminated unit revenues declined one per cent. Yield per passenger rose by 8.3
per cent. Unit revenues per tonne kilometre for cargo traffic declined by 3.1
per cent. Weighted unit revenues for passenger and cargo traffic fell by 1.9 per
cent.
In 2007 euro-denominated operating costs were 3.7 per cent higher than the
previous year. Relative to traffic performance, units costs for flight
operations fell 5.4 per cent, and excluding fuel costs 7.4 per cent. Finnair's
fuel costs in 2007 totalled 440 million euros, some 55 million euros, i.e. 14.3
per cent higher than in 2006. Fuel costs were equivalent to 20.2 per cent
(19.4) of the Group's turnover.
Personnel expenses rose in 2007 by 6.6 per cent partly due to incentive bonus
provisions made as a result of a significant improvement in profit as well as a
higher pension insurance contribution class. The underlying total of salaries
paid has grown by around 14 million euros, i.e. nearly four per cent.
Leasing payments fell by more than ten per cent, as leasing agreements of three
Boeing 757 aircraft used by Leisure Flights were renegotiated on more favourable
financial terms and also due to weakening of USD. The agreements of four other
leisure flight aircraft were renewed in 2006. The fall in the item “Other rental
payments” is due to a reduction in passenger seats and cargo space leased from
other airlines as well as fewer equipment rentals.
The item “Fleet materials and overhauls” fell 23.8 per cent from 2006. One
important factor was a fall in overhaul costs due to new aircraft. In addition,
in the comparison year, particularly in the final quarter, there were excess
depreciations of the spare part inventory as well as subcontracting costs, of
which there were none in 2007.
Depreciation and traffic charges have risen by around nine per cent as a
consequence of new aircraft and increased traffic. In addition, in depreciation
a non-recurring item of 4.5 million euros for the goodwill of FlyNordic as well
as excess depreciation for the Boeing MD-80 fleet, owned by Finnair Aircraft
Finance and used by FlyNordic has been recognised. The change in the fair value
of derivatives has been recognised in the item “Other expenses”.
Ground handling and catering expenses rose by 10.7 per cent due to a growth in
passenger numbers, particularly in long-haul traffic business class, which has
increased its catering expenses. Package tour production costs grew 8.9 per
cent, because customers have moved to an increasing extent to more expensive
categories of hotel.
Earnings per share for the full year amounted to 1.04 euros (-0.14). Equity per
share at the end of the year was 7.70 euros (6.77).
Any comparison should also take into consideration the fact that more than
15 million euros of non-recurring expenses relating to the restructuring
programme were recognised in the second quarter of 2006, which is evident in
cumulative operating expenses. In the comparison of the operational result,
restructuring expenses have been eliminated.
Investment, financing and risk management
Investments in 2007 rose to 326.3 million euros (252.2 million), as a
substantial modernisation programme of the wide-bodied fleet was initiated. The
investments include two Airbus A340 wide-bodied aircraft and five Embraer 190
aircraft. Including advance payments, the cash flow impact of fleet and
auxiliary investments was around 300 million euros in 2007. The cash flow impact
of the new aircraft acquisition programme and auxiliary investments in 2008 will
be around 250 million and in 2009 more than 400 million euros. The final
investment sum will depend on how many of the aircraft are acquired on
operational leasing agreements.
A share issue directed at existing shareholders was implemented in December and
it strengthened the company's cash reserves by 243.8 million euros. The cash
will be used mainly for future aircraft acquisitions. The funds have been
invested temporarily in commercial paper and bank certificates of deposit whose
maturity is less than 12 months. At the end of the year, the Group had balance
sheet cash and cash equivalents amounting to 540.1 million euros, in addition to
which there was a total of 250 million euros in unused committed credit
facilities.
Operational net cash flow was 317.5 million euros, compared with 95.8 million
euros a year earlier. Due to an improvement in cash flow from operations and the
share issue, gearing fell from 7.1 per cent at the beginning of the year to a
debt-free position, namely -22.5 per cent at the end of the year. Gearing
adjusted for leasing liabilities was 35.1 per cent (112.8%). The equity ratio
correspondingly rose from the previous year by 9.8 percentage points to stand at
47.0 per cent.
The income statement's financial items include an item that improves the result
by around five million euros, which is the accounting valuation of the Norwegian
Air Shuttle share options owned by Finnair. If Finnair exercise the options by
the end of 2008, its holding in Norwegian will rise to more than ten per cent.
According to the financial risk management policy approved by Finnair's Board of
Directors, the company has hedged 70 per cent of scheduled traffic's jet fuel
purchases during the next six months and thereafter for the following 30 months
with a decreasing level of hedging. Finnair Leisure Flights price hedges fuel
consumption according to its agreed traffic programme within the framework of
the hedging policy. Derivatives linked to jet fuel and gasoil prices are mainly
used as the fuel price hedging instrument.
Under IFRS rules, a change during the financial period in the fair value of
fuel- and foreign currency-related derivatives that mature in future is
recognised in the Finnair income statement item “Other expenses”. The said
change in the fair value of derivatives is not a realised hedging gain nor does
it have an effect on cash flow; it is a valuation gain in accordance with IFRS
reporting practice. In 2007 the change in the fair value of derivatives was
+14.5 million euros.
When compared to previous year, a weakening of the US dollar against the euro
had a positive impact on Finnair's operational result of around fifteen million
euros, taking foreign currency hedging into account. At the end of December, the
degree of hedging for a dollar basket over the following 12 months was 57 per
cent.
Finnair's investments, financing and risk management are outlined in more detail
in the Financial Report section of the annual report, which will be published in
the week commencing the 10 March 2007.
Shares and Share Capital
Finnair's market value at the end of the year was 1,036.6 million euros (1,101.5
million) and the closing share price was 8.09 euros. During 2007 the highest
price for the Finnair Plc share on the Helsinki Stock Exchange was 14.35 euros
(15.00), while the lowest price was 7.51 euros (10.01) and the average price
10.01 euros (12.50). The fall in the price at the end of the year was also
influenced by the separation of the subscription right from the share. Some 37.7
million (30.0 million) of the company's shares, with a value of Euros 377.2
million (374.6 million), were traded on the Helsinki Stock Exchange.
Finnair arranged a share issue November 29 -December 17, 2007. In the share
issue, 39,379,757 new shares were offered to the company's shareholders for
subscription in proportion to their existing shareholdings. In the share issue,
for every nine subscription rights, shareholders were entitled to subscribe for
four new shares at a price of 6.30 euros per share. All of the shares offered in
the issue were subscribed and paid for. The new shares were entered in the Trade
Register in December 2007, after which the number of shares recorded in
Finnair's trade register entry was 128,136,115 at the end of the year. The
registered share capital was 75,442,904.30 euros. The Finnish State owned 55.78
per cent (55.78%) of Finnair's shares, while 21.72 per cent (34.5%) were held by
foreign investors or in the name of a nominee.
At the beginning of the financial year, Finnair held 151,903 of its own shares,
which it had purchased in previous years. The Annual General Meeting held on
22 March 2007 authorised the Board of Directors for a period of one year to
purchase the company's own shares up to a maximum of 3,500,000 shares and
dispose of the company's own shares up to a maximum of 3,651,000 shares. The
authorisation applies to shares amounting to less than five per cent of the
company's share capital. In 2007 Finnair did not acquire nor dispose of its own
shares. At the end of the year, Finnair held 151,903 of its own shares, namely
0.12 per cent of the total number of shares outstanding on the last day of the
year.
A more detailed account of the share and share capital can be found in the
Financial Report section of the annual report.
Board of Directors and Senior Management
At the Annual General Meeting held on 22 March 2007, the following former
members were elected as members of Finnair Plc's Board of Directors for a term
lasting until the end of the next Annual General Meeting: Christoffer Taxell
(Chairman), Kalevi Alestalo, Satu Huber, Markku Hyvärinen, Kari Jordan, Ursula
Ranin and Veli Sundbäck. In addition, a new member, Sigurdur Helgason, was
elected.
PricewaterhouseCoopers Oy, Authorised Public Accountants, were elected as the
company's regular auditors: Eero Suomela, Authorised Public Accountant, as
auditor with main responsibility, and Jyri Heikkinen APA; Tuomas Honkamäki APA
and Timo Takalo APA as deputy auditors.
Anssi Komulainen, began as SVP Human Resources on 1 February 2007. He moved to
the post from his duties as Managing Director of Finnair Catering Oy. In his
place, Kristina Inkiläinen was appointed Managing Director of Finnair Catering
Oy and SVP, Catering as of 30 April 2007.
Finnair's Legal Counsel Sami Sarelius was appointed Vice President and General
Counsel of the company as of 1 February 2007. He also acts as secretary to the
company's Board of Directors and Board of Management.
Tero Vauraste, Managing Director of the Group's ground handling company
Northport Oy, resigned from his post on 31 May 2007. He was succeeded as
Managing Director of the company by Jukka Hämäläinen as of 13 August 2007.
SVP Flight Operations Hannes Bjurström resigned from the company on 1 November
2007. He was succeeded by Veikko Sievänen, who previously served as Finnair's
Chief Pilot.
Finnair's Corporate Governance is outlined in more detail in the Financial
Report section of the annual report.
Personnel
During 2007, the Finnair Group had an average number of 9,480 (9,598) employees,
which was 1.2 per cent fewer than a year earlier. Scheduled Passenger Traffic
had 4,151 employees and Leisure Traffic 372 employees. The total number of
personnel in technical, catering and ground handling services was 3,674 and in
travel services 1,129. A total of 154 people were employed in other functions.
As part of an 80 million euro efficiency programme, Finnair announced in May
2006 a target of cutting 670 jobs, mainly in Finnair Technical Services and in
administrative support functions by the end of 2007. The reductions according to
the programme have been for the most part implemented. The number of personnel
in group administration and support functions was cut by a third. The number of
personnel in other business areas has declined or remained as before. The number
of personnel in Leisure Traffic rose by 8.5 per cent due to company acquisitions
abroad. Because of traffic growth, an additional 210 flight personnel were
employed.
At the end of the year, Finnair Group had around 750 employees outside of
Finland, of which 250 worked in sales and customer service duties for Finnair's
passenger and cargo traffic. There are a total of 500 employees working for
travel agencies and tour operators based in the Baltic states and Russia, and as
guides at Aurinkomatkat-Suntours' holiday destinations. Foreign personnel are
included in the total number of Group employees.
Full-time staff account for 92 per cent of employees. Around half of part-time
staff are employees on partial child-care leave. Some 93 per cent of staff are
employed on a permanent basis. Seasonal staff are included among those on
fixed-term contracts. The average age of employees is 42 years, with most being
between 30 and 50 years of age. More than 20 per cent are over 50 years old and
one in ten are under 30.
Employees' average length of service is 13 years. One third of Finnair's
personnel have been in the service of the Group for more than 20 years. Nearly
half of these have been employed for more than 30 years.
Of Finnair Group personnel, half are women and half are men. Of the twelve
members of the Finnair Group's Board of Management, two are women. Two of the
eight members of Finnair Plc's Board of Directors are women.
During October-November, Finnair agreed with six labour unions new collective
employment agreements, which will run until spring 2010. The salary increases
agreed in the collective employment agreements impose pressures to continue
improving productivity, especially in labour-intensive business units.
According to the agreement, salaries will rise in the first year by 4-5 per cent
and in the second year by 3-4 per cent. Improvements were also agreed in
flexibility of labour as well as the introduction of performance-related
remuneration models. The pilots' current collective employment agreement will
expire at the end of April 2008. Negotiations on a new collective employment
agreement have already begun.
Incentive bonuses, including social expenses, amounting to about 13 million
euros are expected to be paid to personnel for 2007, and about 10 million euros
in profit bonus into the Personnel Fund. Reserves for incentives under the share
bonus scheme for key individuals, totalling about 9 million euros, have also
been made. The total sum of all incentives is about 32 million euros.
Fleet changes
Finnair Group's fleet is managed by Finnair Aircraft Finance Oy, which belongs
to the Scheduled Passenger Traffic business area. At the end of the year the
Finnair Group had a total of 63 aircraft in flight operations. The average age
of the Finnair Scheduled Passenger Traffic's entire fleet was 5.9 years. In
European traffic, the average age of the fleet is 4.3 years. Finnair has at its
disposal the most modern fleet in European air traffic, which brings both cost
savings and eco-efficiency.
Finnair's long-haul fleet consists of three Airbus A340 aircraft and seven
Boeing MD-11 aircraft. The MD-11 aircraft will be replaced with twin-engine
Airbus A330 wide-bodied aircraft by spring 2010. Five Boeing MD-11 aircraft will
be withdrawn from Finnair's ranks in 2008-2010 as their leasing agreements
expire. Agreements to sell the two aircraft in Finnair's ownership to Aeroflot
Cargo have been made and they will transfer to their new owner in autumn 2008
and in summer 2009.
Because the selling price of the MD-11 aircraft exceeds their book value,
depreciation for their remaining time of use has been reduced so that no
significant capital gains on the sales arise at the end of the period. Due to
the change, monthly depreciation up to the time of the withdrawal of the MD-11
aircraft will be around 0.7 million euros lower compared with the previous
depreciation programme.
The long-haul fleet modernisation programme includes an order for two Airbus
A340 aircraft for 2008 and an order for eight Airbus A330 aircraft for
2009-2010, as well as options for two more. Through the programme, the Finnair
long-haul fleet can be increased from the present ten aircraft to 15 aircraft by
the end of the decade.
In 2014-2016, Finnair will acquire new technology A350XWB aircraft. Finnair has
placed firm orders for 11 of this type of aircraft and has options for four
more.
The Embraer aircraft acquisition programme, which began in autumn 2005,
continues. The number of Embraer aircraft ordered is 20, of which ten are the
76-seat 170 model and ten the 100-seat 190 model. All ten Embraer 170 aircraft
as well as six Embraer 190s have already been delivered to Finnair. In 2008 will
come two more Embraer 190s and in 2009 a further two. Finnair also has options
for six additional Embraer aircraft.
After the withdrawal of the MD-11 aircraft, the company's scheduled passenger
traffic fleet will consist solely of modern Airbus A320, A330 and A340 aircraft
as well as Embraer 170 and 190 aircraft.
The total value of the planned aircraft acquisitions is around two billion
euros, which also includes supporting investments, such as maintenance hangars
as well as spare engines and parts.
The fleet renewal will create a good framework for lowering operating costs and
improving profitability. The commonality of the fleet will boost the efficiency
of crew utilisation and maintenance work. The lower fuel consumption of the new
aircraft will bring savings and cut emissions.
Winglets have been fitted to the seven Boeing 757 aircraft used by Finnair
Leisure Flights. The modification has improved the aircraft's aerodynamics and
consequently reduced fuel consumption and emissions by five per cent.
Four of the ATR 2007 turboprop aircraft used by the Estonian subsidiary Aero
Airlines AS were sold in summer 2007, for which a capital gain was recognised in
the second and third quarters. Aero's traffic was discontinued on 6 January
2008. The remaining ATR aircraft have been sold and a capital gain will
recognised in the first half of the current year.
Environment
In 2007 the EU prepared two different models for the implementation of emissions
trading in air traffic starting in 2012. The emissions trading calculation
principles take into account the performance undertaken for the fuel consumed.
Finnair will respond positively to the emissions trading principles and will
strive as part of the community of European airlines to argue successfully that
the system should be worldwide and not distort competition in the industry.
Finnair has been systematically modernising its fleet since 1999. The European
and domestic traffic's Airbus A320 and Embraer aircraft represent the latest
technology. The modern fleet is eco-efficient both in terms of carbon dioxide
and noise emissions.
Finnair takes the environment into consideration in all of its actions and
decisions. Finnair's environmental issues are outlined in more detail in the
annual report and on the Finnair website.
Kati Ihamäki MSc(Econ) has been appointed as Finnair's VP, Sustainable
Development as of 1 February 2008. Her task will be to promote the realisation
of Finnair's environmental goals in the Group's business operations, such that
Finnair can be among the leading airlines in environmental activities. She will
also be responsible for coordinating environmental strategy and emissions
trading projects as well as for integrating environmental issues into Finnair's
competitive strategy.
Performance of business areas
The primary segment reporting of the Finnair Group's financial statements is
based on business areas. The reporting business areas are Scheduled Passenger
Traffic, Leisure Traffic, Aviation Services and Travel Services.
Scheduled Passenger Traffic
This business area is responsible for sales of scheduled passenger traffic and
cargo, service concepts, flight operations and activity connected with the
procurement and financing of aircraft. Scheduled Passenger Traffic leases to
Leisure Traffic the crews and aircraft it requires. The business area consists
of the following units and companies: Finnair Scheduled Passenger Traffic,
Finnair Cargo Oy and Finnair Aircraft Finance Oy. The Swedish subsidiary
FlyNordic, sold in July 2007, is included for a six-month period, and the
Estonian subsidiary Aero Airlines, whose operations were discontinued on
6 January 2008, is included in the 2007 figures for the whole of the year.
In 2007 the business area's turnover grew by 10.7 per cent to 1,685.3 million
euros (1,522.1 million). The operational result, i.e. adjusted EBIT, was 76.2
million euros (28.6 million).
Scheduled Passenger Traffic carried nearly 7.5 million passengers in 2007.
Scheduled Passenger Traffic's revenue passenger kilometres grew by 18.5 per
cent, while capacity grew by 16.3 per cent, leading to an improvement in
passenger load factor by 1.3 percentage points to 72.9 per cent.
Unit revenues for scheduled passenger traffic fell 4.6 per cent in 2007.
FlyNordic eliminated unit revenues declined 3.8 per cent. Growth of the
relative share of long-haul traffic in scheduled traffic as a whole contributed
to the decline in unit revenues. In long-haul traffic, passenger kilometre-based
unit revenue is lower than in European and domestic traffic. In long-haul
traffic, however, average prices rose from the previous year. In domestic
traffic, on the other hand, the decline in price levels continued.
Cargo revenues account for a good ten per cent of all Scheduled Passenger
Traffic's revenues. Unit revenues for cargo declined by 3.1 per cent in 2007.
The total amount of cargo carried in scheduled passenger traffic grew by 5.2 per
cent. The amount of cargo carried in Asian traffic rose by 24.5 per cent from
the previous year.
Finnair Cargo Oy's profitability improved significantly in 2007. One key reason
for the profit improvement was the significant cut in July 2007 of cargo
capacity leased externally.
In international scheduled traffic, Finnair has increased its market share
compared with its main competitors. In domestic traffic Finnair's market share
has fallen due first and foremost to the discontinuation of short routes. This
has improved the passenger load factor and profitability.
During 2007, the arrival punctuality of scheduled passenger flights fell by four
percentage points to 80.4 per cent (84.4%). The weakening of punctuality has
resulted particularly from the increasing complexity of the company's network
structure. Finnair is still among the ten most punctual European airlines and
one of the best network companies. Special attention will be directed at
production planning and supervision by improving processes and cooperation
between units.
At the end of July 2007, Finnair sold its Swedish subsidiary FlyNordic to
Norwegian Air Shuttle AS. Finnair and Norwegian Air Shuttle have also agreed to
deepen cooperation between the companies. The goal is that Norwegian Air
Shuttle's Scandinavian route network will be linked to Finnair's increasing
Asian connections, whereby growing demand in Asia for tours of the Nordic
countries and Central Europe can be satisfied better.
Leisure Traffic
This business area consists of Finnair Leisure Flights and the
Aurinkomatkat-Suntours package tour company as well as its Estonian subsidiary
Horizon Travel and the takeOFF brand, which focuses on youth travel.
Aurinkomatkat-Suntours is Finland's leading tour operator, with a market share
of 37 per cent. Finnair Leisure Flights has a strong market leadership in
leisure travel flights. The company has ten tour operators as customers. The
tour operators buy for their use and at their own risk the flight series they
wish to holiday destinations either for the summer or winter season.
In 2007 Finnair Leisure Flights carried nearly 1.2 million passengers. Tour
operators cut their capacity due to overcapacity the previous year, which meant
that performance calculated in passenger kilometres was 1.4 per cent less than a
year earlier. Growth of long-haul destinations increased revenue passenger
kilometres by 0.3 per cent, so the passenger load factor for leisure flights
fell 1.4 percentage points to 86.0 per cent.
Internet sales to consumers of mere aircraft seats to holiday destinations grew
strongly. In the winter season, there were 12 return flights a week to Asia.
Winglets were fitted to the Boeing 757 fleet used by Leisure Flights. These
reduced fuel consumption by five per cent and compensated to some degree the
effect on profitability of rising fuel prices. Due to efficiency measures and
sales of additional services, Leisure Flights' result was very good.
Aurinkomatkat-Suntours' passenger numbers declined by three per cent in 2007 to
around 335,000 passengers. Price levels remained good, however, particularly in
the case of winter long-haul trips. The result improved significantly from the
previous year and was clearly in profit. In 2007 Aurinkomatkat-Suntours
purchased Estonia's second biggest, and strongly growing. tour operator Oü
Horizon Travel. The company exceeded the profit targets set for it. At the turn
of the year, Aurinkomatkat-Suntours bought the St. Petersburg travel agency and
tour operator Calypso AS. The company is known for its quality tours and
tailored VIP trips.
In 2007, turnover rose by 5.9 per cent to 409.6 million euros. The operational
result, i.e. adjusted EBIT, improved by 30.1 per cent to 24.2 million euros
(18.6 million).
Finnair has agreed fixed prices with tour operators and provided for the fuel
risk with price hedging in accordance with the Group's financial policy.
Aviation Services
This business area comprises aircraft maintenance services, ground handling and
the Group's catering operations. In addition, the Group's property holdings, the
procurement of office services, and the management and maintenance of properties
related to the Group's operational activities also belong to the Aviation
Services business area.
In 2007 Aviation Services' turnover rose 6.5 per cent to 433.9 million euros.
The operational result, i.e. adjusted EBIT, improved by 34.8 million euros and
was a profit of 10.3 million euros (24.5 million loss). The business area's
units have managed to improve their profitability significantly.
The Catering business is the most profitable of the Aviation Services. Finnair
Technical Services' profitability improved significantly from the previous year,
and the unit broke even. In 2006 Finnair Technical Services was heavily
loss-making.
In the years 2006-2007, Finnair Technical Services implemented a competition
project that examined the whole organisation's business models as well as its
revenue and cost structure. Business profitability has improved by developing
work processes and operating models and by specialising only in maintenance
services for certain aircraft types in which Finnair Technical Services has
special expertise. At the same time, operations for which there is no commercial
justification have been discontinued. Maintenance preparedness for types of
aircraft that Finnair no longer flies has been mostly discontinued.
It is important for Finnair Technical Services' long-term functional capacity
and profitability that the unit also has customers from outside the Group. At
the end of 2007 it was agreed, among other things, that Technical Services would
handle overhauls of the Russian airline Aeroflot Cargo's Boeing MD-11 fleet. The
value of the eight-year contract is more than EUR 200 million euros.
Around 300 jobs were cut from Technical Services in the period 2006-2007. The
reduction was implemented through various pension solutions, outsourcing of
functions and redundancies. Only a small proportion of the reductions were in
the line maintenance important for daily maintenance of aircraft.
The ground handling services company Northport Oy is still is loss making, but
the sale of loss-making subsidiaries in Sweden and Norway alleviated Northport's
losses. These foreign operations were sold to the international ground handling
group Menzies Aviation.
Travel Services
The business area consists of the Group's travel agencies: Matkatoimisto Area,
Finland Travel Bureau and its subsidiary Estravel, which operates in the Baltic
states, as well as Amadeus Finland Oy, which integrates travel agency systems
and sells travel reservation systems.
The business area's net sales in 2007 fell by 5.8 per cent to 82.3 million euros
(87.4 million), but the operational result, i.e. adjusted EBIT, rose to 2.9
million euros (2.3 million).
The Finnair Group's travel agencies, Finland Travel Bureau (FTB) and Area, are
among the leading travel agencies in Finland. With the product's life cycle
waning, FTB has discontinued the guided city breaks to European destinations
produced under the name Etumatkat. The reduction in sales is evident as a fall
in turnover.
Travel agencies' distribution is moving rapidly to the internet. Electronic
sales doubled in 2007. Automation is being used to improve the efficiency of
providing corporate travel services. Area is a pioneer among the traditional
travel agencies in electronic services. FTB has implemented a structural change
programme to adapt the office network and to improve functions and
profitability.
Estravel again met with success in the Baltic states. In Estonia the company's
market share is 37 per cent. Travel Services' Amadeus Finland, a provider of
travel reservation and information systems to travel agencies, brought to the
market many new services relating to companies' and travel agencies' travel
management. Increased travel by Finns is boosting the company's turnover.
Air Traffic Services and Products
Finnair has focused on traffic between Europe and Asia, offering Finns efficient
and diverse connections to the world. More than half of scheduled traffic
revenue is linked to Asian traffic. Finnair has a total of 61 direct flights per
week to ten Asian destinations.
A new Asian destination, Mumbai in India, was opened in June 2007 with five
flights per week. In June 2008 the flight frequency to Mumbai will rise to six,
and at the same time Finnair will begin direct flights to the South Korean
capital Seoul. The route will be flown five times per week. Other Asian
destinations are Bangkok, Beijing, Delhi, Guangzhou, Hong Kong, Nagoya, Osaka,
Shanghai and Tokyo.
Finnair's long-haul strategy exploits Helsinki's ideal location on flight routes
between Asia and Europe. This competitive advantage also gives rise to the Via
Helsinki concept, a collaborative effort of Finnair and Finavia, which means the
shortest possible route, efficient and uncongested transit connections, new
kinds of airport services, and making travelling a pleasant experience.
A terminal extension at Helsinki-Vantaa Airport intended to service Asian
traffic in particular will open in 2009. Flights covering 45 European and 13
domestic destinations connect into Finnair's Asia network. At the same time, a
wide selection of direct connections are offered from Finland to the rest of
Europe. In spring 2007, Finnair opened new, all-year-round destinations, namely
Bucharest, Lisbon and Ljubljana.
In July American Airlines, Finnair and three other European oneworld airlines -
Iberia, Malév and Royal Jordanian - applied for antitrust immunity (ATI) from
the United States' Department of Transport (DOT). The oneworld partners wish to
expand their cooperation in, among other things, traffic and route planning,
marketing, pricing, frequent-flyer schemes, cargo transportation, and
information and distribution systems.
In their bilateral cooperation, Finnair and American Airlines have had a valid
antitrust immunity agreement since 2002. This is reflected, for example, in
common pricing, increased onward connections between Finland and the USA, and
improved airport services.
Finnair Leisure Flights carries the customers of ten tour operators to 66
holiday destinations in 33 countries. In addition, flights alone can be
purchased on the internet to dozens of Leisure Flights' destinations. Growth in
Asian travel is also reflected in Leisure Flights. In the winter season, Leisure
Flights will operate 12 weekly flights to Asia, including daily flights to
Thailand. A new winter destination was Krabi in Thailand.
The Leisure Flights' fleet consists of seven Boeing 757 aircraft and Airbus
capacity leased from Scheduled Passenger Traffic. At the beginning of 2007,
Finnair Leisure Flights launched additional services that customers can pay for
via the internet before their trip. Customers can, for example, order various
meal options, choose a certain seat, or make arrangements for special baggage.
New seats with a slimmer structure have been fitted in the Airbus A320 and A321
aircraft mainly used in European traffic. The new seats have been designed so
that leg room is not reduced, even though the seat spacing has been shortened.
The seat renewal increased by 15 the number of seats in each of the 18 aircraft,
while the weight of the aircraft was reduced by 1,200 kilos, thus enhancing fuel
efficiency.
From December 2007 Finnair has, in cooperation with the insurance company AIG,
offered passengers the opportunity to buy travel cancellation and interruption
insurance from the website when booking flight tickets. Initially the service is
being offered to customers who buy their trips in Finland, Germany and the UK.
The goal is to offer the service in future in all of those markets where a
Finnair ticket can be bought on the internet.
Finnair's Vision 2017
In October 2007, Finnair published its long-term vision, which outlined the
company's future for ten years ahead. The company's objective is to offer
customers the fastest flight connections in intercontinental traffic in the
northern hemisphere. At the same time, Finnair aims to provide Finns with
diverse connections to destinations all over the world. Finnair wishes to be the
airline of choice for quality and environmentally conscious air travellers.
Finnair also aims to be an attractive investment for shareholders.
The vision specifies scheduled traffic between Europe and Asia, and between
North American and Asia, as the key growth areas, because the shortest routes
between these continents pass over Scandinavia. Finnair expects traffic on these
axes to grow strongly in the coming years. The opening of Russian air traffic in
future will present opportunities to supplement the network.
In the vision, Helsinki-Vantaa Airport will play a natural role as a transit
location. The intention of Finnair and Finavia is to develop Helsinki-Vantaa so
that, in addition to basic services, changing aircraft at the airport becomes a
travel experience in itself. The reliable image of Finnair and Finland in the
world is a strength in a changing environment.
With its present fleet programme, Finnair's long-haul fleet can be increased to
over 20 wide-bodied aircraft by 2017. Finnair's total passenger numbers can rise
from the present nine million to over 20 million, and to clearly over three
million passengers in long-haul traffic. The aim of the fleet modernisation is
to create a fleet that is as modern, economic and environmentally positive as
possible.
Finnair wants to be a responsible world citizen that takes the environment into
consideration in everything it does. Finnair supports the International Air
Transport Association IATA's target towards zero-emissions air transport.
Decreasing the environmental load of air transport will facilitate growth in air
travel also in the future.
Finnair considers that the significance of Asian airlines in intercontinental
traffic will grow and that consolidation among airlines will continue. For
Finnair, the most interesting future cooperation candidates are to be found
among the quality Asian oneworld airline partners. The main goal for Finnair is
to improve connections and services offered to customers while increasing value
for shareholders.
Leisure Traffic is also part of Finnair's core business. The aim is to expand
package tour and charter operations from the Finnish market into the Baltic Sea
area, particularly the Baltic states and Russian market.
The Finnair brand's success factors will continue to be based in future on
strong expertise and good networking. The value generated for a Finnish
airline's customers will be based on safety, freshness, creativity and
Finnishness, which are positive, differentiating qualities.
Short-term risks and uncertainty factors
Fuel costs constitute approximately one fifth of the Group's total costs and are
one of the most significant uncertainty factors where costs are concerned. The
price of oil has been at a record high during recent months. A degree of hedging
in excess of 70 per cent and US dollar's relationship to the euro will dampen
the influence of the oil price, but if the present trend continues, fuel costs
will increase faster than operational performance.
A weakening in general economic conditions may slow growth of air travel.
Negotiations to renew the collective employment agreement of pilots, which ends
on 30 April 2008, are under way.
Outlook
The success of Finnair's scheduled passenger traffic is based on the fastest
connection between Europe and Asia. For this reason, the company's investments
are focused on ensuring the growth of Asian traffic. Fleet acquisitions in the
coming years will be aimed at improving competitiveness in long-haul traffic
directed to Asia and in European feeder traffic.
In 2008 Asian traffic capacity will grow by more than 20 per cent when two new
Airbus A340 aircraft join Finnair's long-haul fleet in the second and third
quarters. A harmonised fleet will mean a more efficient cost structure due to
more simplified crew utilisation and maintenance activities.
The majority of passengers on Finnair's Asian flights connect to the company's
European network. Growth in Asian traffic will therefore be reflected also in
demand for European traffic.
The price of fuel is expected to remain high and to exert pressure for ticket
price increases whenever the market situation permits. Based on current fuel
prices, fuel costs are expected to be over 22 per cent of the turnover in 2008.
Demand is expected to be good in the early part of the year, but a change in
passenger preference from group travel to individual travel will also bring the
making of reservations closer to the travel date. In terms of the timing of
profit development, it is worth noting that Easter, when fewer higher-priced
business trips are made, falls this year in the first quarter, when last year it
was in the second quarter. In Leisure Traffic, strong demand for winter
long-haul trips will be evident.
It is expected that the predicted slower growth in the global economy will have
less impact on air traffic between Europe and Asia than on the development in
certain other traffic areas.
Personnel will be increased to meet the needs of growing traffic. The salary
increases agreed in the collective employment agreements will exert pressure to
continue improving productivity. The profit impact of the 80 million
restructuring programme implemented in 2006-2007 will be evident in full this
year.
Board of Directors Proposal on the Dividend
The distributable equity of Finnair Plc amounts to 511.0 million euros. The
Board of Directors proposes to the Annual General Meeting that a dividend of
0.25 euros (0.10) per share be distributed, and that the remainder of the
distributable equity be carried over as retained earnings. No dividend will be
paid for own shares held by Finnair.
FINNAIR PLC
Board of Directors
Press conference
Finnair with arrange briefings on February 4th for the media at 11, and for
analysts at 12.30. The location is Toimistotorni, Lentäjäntie 3 at
Helsinki-Vantaa Airport. Further information and registrations: Hanna-Kaisa
Nurmi, tel. +358 9 818 4951 or hanna-kaisa.nurmi@finnair.fi.
Finnair Plc
Communications
Christer Haglund
Senior Vice President, Communications
For further information, please contact:
SVP and CFO Lasse Heinonen
tel. +358 9 818 4950
lasse.heinonen@finnair.fi
SVP Communications, Christer Haglund
tel. +358 9 818 4007
christer.haglund@finnair.fi
Director, Investor Relations Taneli Hassinen
tel. +358 9 818 4976
taneli.hassinen@finnair.fi
http://www.finnair.com/investor
FINNAIR GROUP FINANCIAL STATEMENT FOR JANUARY 1 - DECEMBER 31, 2007
KEY FIGURES EUR mill.
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Oct- | 1 Oct- | % |
| | 31 | 31 | |
| | Dec | Dec | |
--------------------------------------------------------------------------------
| Turnover | 568.7 | 499.3 | 13.9 |
--------------------------------------------------------------------------------
| Profit before depreciation and lease | 70.6 | 27.9 | - |
| payments. EBITDAR * | | | |
--------------------------------------------------------------------------------
| Lease payments for aircraft | 20.6 | 22.8 | -9.6 |
--------------------------------------------------------------------------------
| Operating profit, EBIT* | 24.4 | -24.4 | - |
--------------------------------------------------------------------------------
| Fair value changes of derivatives | 0.2 | -1.4 | - |
--------------------------------------------------------------------------------
| Profit from disposal of capital | 6.2 | 0.0 | - |
| assets | | | |
--------------------------------------------------------------------------------
| Operating profit, EBIT | 30.8 | -25.8 | - |
--------------------------------------------------------------------------------
| Profit for the financial year (share | 26.9 | -20.3 | - |
| attributable to shareholders of | | | |
| parent company) | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Operating profit, EBIT, % of | 4.3 | -4.9 | - |
| turnover * | | | |
--------------------------------------------------------------------------------
| EBITDAR, % of turnover * | 12.4 | 5.6 | - |
--------------------------------------------------------------------------------
| Unit revenues of flight operations | 72.2 | 74.5 | -3.1 |
| c/RTK | | | |
--------------------------------------------------------------------------------
| Unit costs of flight operations | 43.1 | 46.8 | -7.9 |
| c/ATK | | | |
--------------------------------------------------------------------------------
| Earnings per share EUR (basic and | 0.27 | -0.21 | - |
| diluted) | | | |
--------------------------------------------------------------------------------
| Result per share EUR ** | - | - | - |
--------------------------------------------------------------------------------
| Equity per share EUR | 10.07 | - | - |
--------------------------------------------------------------------------------
| Equity per share EUR ** | 7.70 | 6.77 | 13.7 |
--------------------------------------------------------------------------------
| Gross investment EUR mill. | 62.0 | 57.1 | - |
--------------------------------------------------------------------------------
| Gross investment, % of turnover | 10.9 | 11.4 | - |
--------------------------------------------------------------------------------
| Equity ratio % | | | |
--------------------------------------------------------------------------------
| Gearing % | | | |
--------------------------------------------------------------------------------
| Adjusted gearing % | | | |
--------------------------------------------------------------------------------
| Rolling 12-month ROCE % | | | |
--------------------------------------------------------------------------------
| Rolling 12-month ROE % | | | |
--------------------------------------------------------------------------------
KEY FIGURES EUR mill.
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Jan- | 1 Jan- | % |
| | 31 | 31 | |
| | Dec | Dec | |
--------------------------------------------------------------------------------
| Turnover | 2 180.5 | 1 989.6 | 9.6 |
--------------------------------------------------------------------------------
| Profit before depreciation and | 287.4 | 206.8 | 39.0 |
| lease payments. EBITDAR * | | | |
--------------------------------------------------------------------------------
| Lease payments for aircraft | 81.2 | 90.8 | -10.6 |
--------------------------------------------------------------------------------
| Operating profit, EBIT* | 96.6 | 11.2 | - |
--------------------------------------------------------------------------------
| Fair value changes of derivatives | 14.5 | -8.8 | - |
--------------------------------------------------------------------------------
| Profit from disposal of capital | 30.4 | -13.2 | - |
| assets | | | |
--------------------------------------------------------------------------------
| Operating profit, EBIT | 141.5 | -10.8 | - |
--------------------------------------------------------------------------------
| Profit for the financial year | 101.6 | -13.6 | - |
| (share attributable to | | | |
| shareholders of parent company) | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Operating profit, EBIT, % of | 4.4 | 0.6 | - |
| turnover * | | | |
--------------------------------------------------------------------------------
| EBITDAR, % of turnover * | 13.2 | 10.4 | 26.8 |
--------------------------------------------------------------------------------
| Unit revenues of flight operations | 72.6 | 74.0 | -1.9 |
| c/RTK | | | |
--------------------------------------------------------------------------------
| Unit costs of flight operations | 43.5 | 46.0 | -5.4 |
| c/ATK | | | |
--------------------------------------------------------------------------------
| Earnings per share EUR (basic and | 1.04 | -0.14 | - |
| diluted) | | | |
--------------------------------------------------------------------------------
| Result per share EUR ** | 0.79 | -0.15 | - |
--------------------------------------------------------------------------------
| Equity per share EUR | 10.07 | - | - |
--------------------------------------------------------------------------------
| Equity per share EUR ** | 7.70 | 6.77 | 13.7 |
--------------------------------------------------------------------------------
| Gross investment EUR mill. | 326.3 | 252.2 | 29.4 |
--------------------------------------------------------------------------------
| Gross investment, % of turnover | 15.0 | 12.7 | - |
--------------------------------------------------------------------------------
| Equity ratio % | 47.0 | 37.2 | - |
--------------------------------------------------------------------------------
| Gearing % | -22.5 | 7.1 | - |
--------------------------------------------------------------------------------
| Adjusted gearing % | 35.1 | 112.8 | - |
--------------------------------------------------------------------------------
| Rolling 12-month ROCE % | 14.2 | -0.1 | - |
--------------------------------------------------------------------------------
| Rolling 12-month ROE % | 12.9 | -2.0 | - |
--------------------------------------------------------------------------------
* Excluding capital assets, fair value changes of derivatives and non
restructuring items.
** Number of shares at the end of financial year.
Unit costs of flight operations c / ATK = Operating expenses (excluding fair
value changes of derivatives and non restructuring items) of Scheduled Traffic
business area and Leisure Flights business unit / ATK of Group.
CALCULATION OF KEY RATIOS
Earnings / share:
Profit for the financial year/
Weighted average number of shares, adjusted for share issues
Equity / share:
Shareholders' equity/
Number of shares at the end of the financial year
adjusted for share issues
Gearing %:
Net interest bearing liabilities*100/
Shareholders' equity + minority interest
Return on capital employed % (ROCE):
Profit before taxes + interest and other financial expenses *100/
Balance sheet total - non-interest-bearing liabilities (average)
Net interest-bearing liabilities:
Interest-bearing liabilities - interest-bearing assets - listed shares
Equity ratio %:
Shareholders' equity + minority interest*100/
Balance sheet total - advances received
Return on equity %: (ROE)
Result *100/
Equity + minority interests (average)
Operating profit, EBIT = Operating profit excluding the disposal of the capital
assets, fair value changes of derivatives and non restructuring items
Shareholders equity = to equity holders of the parent
The figures of financial statement have not been audited.
CONSOLIDATED INCOME STATEMENT (EUR mill.)
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Oct- | 1 Oct | % |
| | 31 | 31 | |
| | Dec | Dec | |
--------------------------------------------------------------------------------
| Turnover | 568.7 | 499.3 | 13.9 |
--------------------------------------------------------------------------------
| Work used for own purposes and | 0.6 | 1.7 | -64.7 |
| capitalized | | | |
--------------------------------------------------------------------------------
| Other operating income | 11.6 | 0.8 | - |
--------------------------------------------------------------------------------
| Operating income | 580.9 | 501.8 | 15.8 |
--------------------------------------------------------------------------------
| Operating expenses | | | |
--------------------------------------------------------------------------------
| Staff costs | 150.1 | 131.6 | 14.1 |
--------------------------------------------------------------------------------
| Fuel | 115.9 | 99.8 | 16.1 |
--------------------------------------------------------------------------------
| Lease payment for aircraft | 20.6 | 22.8 | -9.6 |
--------------------------------------------------------------------------------
| Other rental payments | 15.3 | 22.4 | -31.7 |
--------------------------------------------------------------------------------
| Fleet materials and overhauls | 18.3 | 25.3 | -27.7 |
--------------------------------------------------------------------------------
| Traffic charges | 42.9 | 38.9 | 10.3 |
--------------------------------------------------------------------------------
| Ground handling and catering | 36.0 | 36.7 | -1.9 |
| expenses | | | |
--------------------------------------------------------------------------------
| Expenses for tour operations | 36.8 | 30.5 | 20.7 |
--------------------------------------------------------------------------------
| Sales and marketing expenses | 26.4 | 26.4 | 0.0 |
--------------------------------------------------------------------------------
| Depreciation | 25.6 | 29.5 | -13.2 |
--------------------------------------------------------------------------------
| Other expenses | 62.2 | 63.7 | -2.4 |
--------------------------------------------------------------------------------
| Total | 550.1 | 527.6 | 4.3 |
--------------------------------------------------------------------------------
| Operating profit EBIT | 30.8 | -25.8 | - |
--------------------------------------------------------------------------------
| Financial income | 9.0 | 3.4 | 164.7 |
--------------------------------------------------------------------------------
| Financial expenses | -4.6 | -3.9 | 17.9 |
--------------------------------------------------------------------------------
| Share of result in associates | 0.0 | 0.0 | - |
--------------------------------------------------------------------------------
| Profit before taxes | 35.2 | -26.3 | - |
--------------------------------------------------------------------------------
| Direct taxes | -8.2 | 6.0 | - |
--------------------------------------------------------------------------------
| Profit for financial year | 27.0 | -20.3 | - |
--------------------------------------------------------------------------------
CONSOLIDATED INCOME STATEMENT (EUR mill.)
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Jan- | 1 Jan- | % |
| | 31 Dec | 31 | |
| | | Dec | |
--------------------------------------------------------------------------------
| Turnover | 2 180.5 | 1 989.6 | 9.6 |
--------------------------------------------------------------------------------
| Work used for own purposes and | 3.0 | 3.7 | -18.9 |
| capitalized | | | |
--------------------------------------------------------------------------------
| Other operating income | 54.3 | 17.9 | - |
--------------------------------------------------------------------------------
| Operating income | 2 237.8 | 2 011.2 | 11.3 |
--------------------------------------------------------------------------------
| Operating expenses | | | |
--------------------------------------------------------------------------------
| Staff costs | 541.5 | 508.2 | 6.6 |
--------------------------------------------------------------------------------
| Fuel | 439.9 | 385.0 | 14.3 |
--------------------------------------------------------------------------------
| Lease payment for aircraft | 81.2 | 90.8 | -10.6 |
--------------------------------------------------------------------------------
| Other rental payments | 63.8 | 80.7 | -20.9 |
--------------------------------------------------------------------------------
| Fleet materials and overhauls | 76.7 | 100.6 | -23.8 |
--------------------------------------------------------------------------------
| Traffic charges | 177.0 | 161.9 | 9.3 |
--------------------------------------------------------------------------------
| Ground handling and catering | 154.3 | 139.4 | 10.7 |
| expenses | | | |
--------------------------------------------------------------------------------
| Expenses for tour operations | 120.6 | 111.5 | 8.2 |
--------------------------------------------------------------------------------
| Sales and marketing expenses | 92.0 | 91.3 | 0.8 |
--------------------------------------------------------------------------------
| Depreciation | 114.1 | 104.8 | 8.9 |
--------------------------------------------------------------------------------
| Other expenses | 235.2 | 247.8 | -5.1 |
--------------------------------------------------------------------------------
| Total | 2 096.3 | 2 022.0 | 3.7 |
--------------------------------------------------------------------------------
| Operating profit EBIT | 141.5 | -10.8 | - |
--------------------------------------------------------------------------------
| Financial income | 17.2 | 11.0 | 56.4 |
--------------------------------------------------------------------------------
| Financial expenses | -19.9 | -15.0 | 32.7 |
--------------------------------------------------------------------------------
| Share of result in associates | 0.1 | 0.1 | - |
--------------------------------------------------------------------------------
| Profit before taxes | 138.9 | -14.7 | - |
--------------------------------------------------------------------------------
| Direct taxes | -36.8 | 1.7 | - |
--------------------------------------------------------------------------------
| Profit for financial year | 102.1 | -13.0 | - |
--------------------------------------------------------------------------------
CONSOLIDATED INCOME STATEMENT (EUR mill.)
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change | |
--------------------------------------------------------------------------------
| | 1 Oct- | 1 Oct | % | |
| | 31 Dec | 31 | | |
| | | Dec | | |
--------------------------------------------------------------------------------
| Earnings per share to | 26.9 | -20.3 | |
| shareholders of the parent | | | |
| company | | | |
--------------------------------------------------------------------------------
| Minority interest | 0.1 | 0.0 | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Earnings per share calculated | | | |
| from profit attributable to | | | |
| shareholders of the parent | | | |
| company | | | |
--------------------------------------------------------------------------------
| Earnings per share EUR (basic | 0.27 | -0.21 | |
| and diluted) | | | |
--------------------------------------------------------------------------------
CONSOLIDATED INCOME STATEMENT (EUR mill.)
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change | |
--------------------------------------------------------------------------------
| | 1 Jan- | 1 Jan- | % | |
| | 31 Dec | 31 | | |
| | | Dec | | |
--------------------------------------------------------------------------------
| Earnings per share to | 101.6 | -13.6 | |
| shareholders of the parent | | | |
| company | | | |
--------------------------------------------------------------------------------
| Minority interest | 0.5 | 0.6 | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Earnings per share calculated | | | |
| from profit attributable to | | | |
| shareholders of the parent | | | |
| company | | | |
--------------------------------------------------------------------------------
| Earnings per share EUR (basic | 1.04 | -0.14 | |
| and diluted) | | | |
--------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEET (EUR mill.)
--------------------------------------------------------------------------------
| | 31 Dec 2007 | 31 Dec 2006 |
--------------------------------------------------------------------------------
| ASSETS | | |
--------------------------------------------------------------------------------
| Non-current assets | | |
--------------------------------------------------------------------------------
| Intangible assets | 46.6 | 47.5 |
--------------------------------------------------------------------------------
| Tangible assets | 1 168.9 | 1 012.3 |
--------------------------------------------------------------------------------
| Investments in associates | 5.7 | 5.6 |
--------------------------------------------------------------------------------
| Financial assets | 13.8 | 15.4 |
--------------------------------------------------------------------------------
| Deferred tax receivables | 13.2 | 27.1 |
--------------------------------------------------------------------------------
| Total | 1 248.2 | 1 107.9 |
--------------------------------------------------------------------------------
| Short-term receivables | | |
--------------------------------------------------------------------------------
| Inventories | 36.1 | 38.5 |
--------------------------------------------------------------------------------
| Trade receivables and other | 287.3 | 211.8 |
| receivables | | |
--------------------------------------------------------------------------------
| Investments | 518.6 | 268.6 |
--------------------------------------------------------------------------------
| Cash and bank equivalents | 21.5 | 25.7 |
--------------------------------------------------------------------------------
| Total | 863.5 | 544.6 |
--------------------------------------------------------------------------------
| Non-current Assets held for sale | 34.7 | 7.6 |
--------------------------------------------------------------------------------
| Assets total | 2 146.4 | 1 660.1 |
--------------------------------------------------------------------------------
| SHAREHOLDERS´ EQUITY AND LIABILITIES | | |
--------------------------------------------------------------------------------
| Capital and reserves attributable to | | |
| equity holders of the parent company | | |
--------------------------------------------------------------------------------
| Shareholders´equity | 75.4 | 75.4 |
--------------------------------------------------------------------------------
| Other equity | 909.9 | 524.5 |
--------------------------------------------------------------------------------
| Total | 985.3 | 599.9 |
--------------------------------------------------------------------------------
| Minority interest | 1.7 | 1.6 |
--------------------------------------------------------------------------------
| Equity, total | 987.0 | 601.5 |
--------------------------------------------------------------------------------
| Long-term liabilities | | |
--------------------------------------------------------------------------------
| Deferred tax liability | 143.4 | 115.7 |
--------------------------------------------------------------------------------
| Financial liabilities | 269.6 | 286.9 |
--------------------------------------------------------------------------------
| Pension obligations | 15.8 | 7.0 |
--------------------------------------------------------------------------------
| Total | 428.8 | 409.6 |
--------------------------------------------------------------------------------
| Short-term liabilities | | |
--------------------------------------------------------------------------------
| Current income tax liabilities | 12.1 | 3.0 |
--------------------------------------------------------------------------------
| Reserves | 0.0 | 10.0 |
--------------------------------------------------------------------------------
| Financial liabilities | 54.5 | 56.6 |
--------------------------------------------------------------------------------
| Trade payables and other liabilities | 664.0 | 579.4 |
--------------------------------------------------------------------------------
| Total | 730.6 | 649.0 |
--------------------------------------------------------------------------------
| Liabilities total | 1 159.4 | 1 058.6 |
--------------------------------------------------------------------------------
| Short-term liabilities | 2 146.4 | 1 660.1 |
--------------------------------------------------------------------------------
SHAREHOLDERS´EQUITY EUR mill.
--------------------------------------------------------------------------------
| Equity attributable to shareholders of parent company | |
--------------------------------------------------------------------------------
| | Shar | Shar | Shar | Bonu | Hed- | Retai- | Total | Mi-no | Own |
| | e | e | e | s | ging | ned | | - | equity |
| | capi | is- | pre- | is- | rese | ear-ni | | rity | total |
| | -tal | sue | mium | sue | r-ve | ngs | | inte- | |
| | | | ac-c | | | | | rests | |
| | | | ount | | | | | | |
--------------------------------------------------------------------------------
| Share-h | 73.8 | 0.6 | 18.3 | 147. | 20.9 | 411.1 | 672.4 | 1.6 | 674.0 |
| olders´ | | | | 7 | | | | | |
| equity | | | | | | | | | |
| 1.1.200 | | | | | | | | | |
| 6 | | | | | | | | | |
--------------------------------------------------------------------------------
| Optio | 1.6 | -0.6 | 4.4 | | | | 5.4 | | 5.4 |
| right | | | | | | | | | |
| to own | | | | | | | | | |
| shares | | | | | | | | | |
--------------------------------------------------------------------------------
| Share | | | -2.3 | | | 2.1 | -0.2 | | -0.2 |
| premium | | | | | | | | | |
| account | | | | | | | | | |
| changes | | | | | | | | | |
--------------------------------------------------------------------------------
| Trans-l | | | | | | 0.3 | 0.3 | | 0.3 |
| ation | | | | | | | | | |
| dif-fer | | | | | | | | | |
| ence | | | | | | | | | |
--------------------------------------------------------------------------------
| Purchas | | | | | | -0.6 | -0.6 | -0.2 | -0.8 |
| e of | | | | | | | | | |
| minorit | | | | | | | | | |
| y | | | | | | | | | |
| intrest | | | | | | | | | |
--------------------------------------------------------------------------------
| Dividen | | | | | | -21.8 | -21.8 | -0.4 | -22.2 |
| d | | | | | | | | | |
| payment | | | | | | | | | |
--------------------------------------------------------------------------------
| Change | | | | | -42. | | -42.0 | | -42.0 |
| in fair | | | | | 0 | | | | |
| value | | | | | | | | | |
| of | | | | | | | | | |
| hedging | | | | | | | | | |
| instrum | | | | | | | | | |
| ents | | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | | -13.6 | -13.6 | 0.6 | -13.0 |
| for the | | | | | | | | | |
| period | | | | | | | | | |
--------------------------------------------------------------------------------
| Share-h | 75.4 | 0.0 | 20.4 | 147. | -21. | 377.5 | 599.9 | 1.6 | 601.5 |
| olders´ | | | | 7 | 1 | | | | |
| equity | | | | | | | | | |
| 31.12.2 | | | | | | | | | |
| 006 | | | | | | | | | |
--------------------------------------------------------------------------------
SHAREHOLDERS´EQUITY EUR mill.
--------------------------------------------------------------------------------
| Equity attributable to shareholders of parent company | |
--------------------------------------------------------------------------------
| | Sha | Sha | Shar | Bon | Hed-g | Un- | Re-ta | Tota | Mino | Own |
| | re | re | e | us | ing | re-st | ined | l | -rit | equi |
| | ca- | iss | pre- | iss | re-se | ric-t | ear-n | | y | ty |
| | pit | ue | mium | ue | rve | ed | ings | | inte | tota |
| | al | | ac-c | | | equit | | | -res | l |
| | | | ount | | | y | | | ts | |
--------------------------------------------------------------------------------
| Share- | 75. | 0.0 | 20.4 | 147 | -21.1 | 0.0 | 377.5 | 599. | 1.6 | 601. |
| holder | 4 | | | .7 | | | | 9 | | 5 |
| s´ | | | | | | | | | | |
| equity | | | | | | | | | | |
| 1.1.20 | | | | | | | | | | |
| 07 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Trans- | | | | | | 0.0 | -0.1 | -0.1 | | -0.1 |
| lation | | | | | | | | | | |
| differ | | | | | | | | | | |
| ence | | | | | | | | | | |
--------------------------------------------------------------------------------
| Divide | | | | | | 0.0 | -8.9 | -8.9 | -0.4 | -9.3 |
| nd | | | | | | | | | | |
| paymen | | | | | | | | | | |
| t | | | | | | | | | | |
--------------------------------------------------------------------------------
| Share | 0.0 | 0.0 | 0.0 | | | 244.9 | 0.0 | 244. | | 244. |
| issue | | | | | | | | 9 | | 9 |
--------------------------------------------------------------------------------
| Change | | | | | 47.9 | | | 47.9 | | 47.9 |
| in | | | | | | | | | | |
| fair | | | | | | | | | | |
| value | | | | | | | | | | |
| of | | | | | | | | | | |
| hedgin | | | | | | | | | | |
| g | | | | | | | | | | |
| instru | | | | | | | | | | |
| ments | | | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | | 0.0 | 101.6 | 101. | 0.5 | 102. |
| for | | | | | | | | 6 | | 1 |
| the | | | | | | | | | | |
| period | | | | | | | | | | |
--------------------------------------------------------------------------------
| Share- | 75. | 0.0 | 20.4 | 147 | 26.8 | 244.9 | 470.1 | 985. | 1.7 | 987. |
| holder | 4 | | | .7 | | | | 3 | | 0 |
| s´ | | | | | | | | | | |
| equity | | | | | | | | | | |
| 31.12. | | | | | | | | | | |
| 2007 | | | | | | | | | | |
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT
--------------------------------------------------------------------------------
| EUR mill. | 1 Jan - 31 | 1 Jan - 31 Dec |
| | Dec 2007 | 2006 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Cash flow from operating activities | | |
--------------------------------------------------------------------------------
| Profit for the financial year | 102.1 | -13.0 |
--------------------------------------------------------------------------------
| Operations for which a payment is not | 112.3 | 100.2 |
| included 1) | | |
--------------------------------------------------------------------------------
| Interest and other financial expenses | 19.9 | 15.0 |
--------------------------------------------------------------------------------
| Interest income | -11.9 | -9.1 |
--------------------------------------------------------------------------------
| Other financial income | -5.1 | -1.8 |
--------------------------------------------------------------------------------
| Dividend income | -0.2 | -0.1 |
--------------------------------------------------------------------------------
| Taxes | 36.8 | -1.7 |
--------------------------------------------------------------------------------
| Changes in working capital: | | |
--------------------------------------------------------------------------------
| Change in trade and other receivables | 2.4 | 10.2 |
--------------------------------------------------------------------------------
| Change in inventories | 2.4 | 6.7 |
--------------------------------------------------------------------------------
| Change in accounts payables and other | 89.8 | 13.4 |
| liabilities | | |
--------------------------------------------------------------------------------
| Interest paid | -14.6 | -11.0 |
--------------------------------------------------------------------------------
| Paid financial expenses | -2.3 | -3.4 |
--------------------------------------------------------------------------------
| Received interest | 9.6 | 9.9 |
--------------------------------------------------------------------------------
| Received financial income | 0.5 | 1.6 |
--------------------------------------------------------------------------------
| Taxes paid | -24.2 | -21.1 |
--------------------------------------------------------------------------------
| Net cash flow from operating activities | 317.5 | 95.8 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Cash flow from investing activities | | |
--------------------------------------------------------------------------------
| Acquisitions of subsidiaries | -0.6 | 0.0 |
--------------------------------------------------------------------------------
| Investments in intangible assets | -15.4 | -12.6 |
--------------------------------------------------------------------------------
| Investments in tangible assets | -346.2 | -273.0 |
--------------------------------------------------------------------------------
| Net change of financial interest bearing | -205.6 | 53.2 |
| assets at fair value through profit and | | |
| loss | | |
--------------------------------------------------------------------------------
| Sales of tangible fixed assets | 65.2 | 2.3 |
--------------------------------------------------------------------------------
| Received dividends | 0.2 | 0.1 |
--------------------------------------------------------------------------------
| Change in non-current receivable | 1.7 | 2.3 |
--------------------------------------------------------------------------------
| Net cash flow from investing activities | -500.7 | -227.7 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Cash flow from financing activities | | |
--------------------------------------------------------------------------------
| Loan withdrawals and changes | 95.6 | 108.3 |
--------------------------------------------------------------------------------
| Loan repayments | -115.0 | -25.9 |
--------------------------------------------------------------------------------
| Share issue | 244.9 | 0.0 |
--------------------------------------------------------------------------------
| Optio right to shares | 0.0 | 5.4 |
--------------------------------------------------------------------------------
| Dividends paid | -8.9 | -21.8 |
--------------------------------------------------------------------------------
| Net cash flow from financing activities | 216.6 | 66.0 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Change in cash flows | 33.4 | -65.9 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Change in liquid funds | | |
--------------------------------------------------------------------------------
| Liquid funds, at beginning | 273.5 | 339.4 |
--------------------------------------------------------------------------------
| Change in cash flows | 33.4 | -65.9 |
--------------------------------------------------------------------------------
| Liquit funds, in the end | 306.9 | 273.5 |
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT
--------------------------------------------------------------------------------
| EUR mill. | 1 Jan - 31 | 1 Jan - 31 |
| | Dec 2007 | Dec 2006 |
--------------------------------------------------------------------------------
| Notes to consolidated cash flow statement | | |
--------------------------------------------------------------------------------
| 1) Operations for which a payment is not | | |
| included | | |
--------------------------------------------------------------------------------
| Depreciation | 114.1 | 104.8 |
--------------------------------------------------------------------------------
| Employee benefits | 6.8 | -2.8 |
--------------------------------------------------------------------------------
| Finance lease | -4.9 | -5.0 |
--------------------------------------------------------------------------------
| Other adjustments | -3.7 | 3.2 |
--------------------------------------------------------------------------------
| Total | 112.3 | 100.2 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Financial asset at fair value | 518.6 | 268.6 |
--------------------------------------------------------------------------------
| Cash and bank equivalents | 21.5 | 25.7 |
--------------------------------------------------------------------------------
| Short-term cash and cash equivalents in | 540.1 | 294.3 |
| balance sheet | | |
--------------------------------------------------------------------------------
| Shares held to trading purposes | -3.0 | -2.9 |
--------------------------------------------------------------------------------
| Maturing after more than 3 months | -223.5 | -17.9 |
--------------------------------------------------------------------------------
| Fair value adjustment of shares available | -6.7 | 0.0 |
| for sale | | |
--------------------------------------------------------------------------------
| Total in cash flow statement | 306.9 | 273.5 |
--------------------------------------------------------------------------------
ADDITIONAL INFORMATION ON THE CONSOLIDATED FINANCIAL STATEMENTS BULLETIN
1. BASIS OF PREPARATION
This consolidated financial statements bulletin has been prepared in accordance
with the Ministry of Finance decree of 9 February 2007 on the regular duty to
disclose of an issuer of securities.
2. ACCOUNTING PRINCIPLES
The following new standards, changes to standards and the application of
interpretations which are perceived to be essential for the Group have been
introduced from the beginning of 2007:
- IFRS 7 Financial Instruments; Disclosures in the Financial Statements as well
as amendments to the IAS 1 Standard: Presentation of Financial Statements -
Capital Disclosures. IFRS 7 calls for new disclosures on financial instruments.
The standard has no impact on the classification or valuation of the Group's
financial instruments.
- IFRIC 9 Reassessment of Embedded Derivatives. The interpretation requires that
an entity must assess whether contracts contain an embedded derivative that must
be separated from the host contract and accounted for as a derivative.
These new, introduced standards and interpretations have no substantial impact
on reporting in the income statement, balance sheet and notes.
The following interpretations are compulsory in 2007, but they have no
significance for the Group:
- IFRIC 7 Applying the Restatement Approach under IAS 29 Financial Reporting in
Hyperinflationary Economies.
- IFRIC 8 Scope of IFRS 2.
3. SEGMENT INFORMATION
The business segments, Scheduled Passenger Traffic, Leisure Traffic, Aviation
Services and Travel Services, are the primary reporting format. The geographical
segments, Finland, Europe, Asia, North America and Others, are the secondary
reporting format. Segment information will based on the corresponding
information reported in the financial statement.
PRIMARY REPORTING FORMAT - BUSINESS SEGMENT DATA 1 January - 31 December 2007
--------------------------------------------------------------------------------
| | Schedu | Lei-s | Avia- | Travel | Group | Un- | Group |
| | -led | ure | tion | Servi-c | elimin | allo-ca | |
| | Pas-se | Traf- | Servi | es | a-tions | ted | |
| | nger | fic | -ces | | | items | |
| | Traffi | | | | | | |
| | c | | | | | | |
--------------------------------------------------------------------------------
| EUR mill. | | | | | | | |
--------------------------------------------------------------------------------
| External | 1 | 403.6 | 121.0 | 77.6 | | | 2 180.5 |
| turnover | 578.3 | | | | | | |
--------------------------------------------------------------------------------
| Internal | 107.0 | 6.0 | 312.9 | 4.7 | -430.6 | | 0.0 |
| turnover | | | | | | | |
--------------------------------------------------------------------------------
| Turnover | 1 | 409.6 | 433.9 | 82.3 | -430.6 | 0.0 | 2 180.5 |
| | 685.3 | | | | | | |
--------------------------------------------------------------------------------
| Operating | 79.2 | 24.2 | 16.9 | 2.9 | | 18.3 | 141.5 |
| profit | | | | | | | |
--------------------------------------------------------------------------------
| Share of | | | | | | 0.1 | 0.1 |
| results of | | | | | | | |
| associated | | | | | | | |
| undertaking | | | | | | | |
| s | | | | | | | |
--------------------------------------------------------------------------------
| Financial | | | | | | 17.2 | 17.2 |
| income | | | | | | | |
--------------------------------------------------------------------------------
| Financial | | | | | | -19.9 | -19.9 |
| expenses | | | | | | | |
--------------------------------------------------------------------------------
| Income tax | | | | | | -36.8 | -36.8 |
--------------------------------------------------------------------------------
| Minority | | | | | | -0.5 | -0.5 |
| interest | | | | | | | |
--------------------------------------------------------------------------------
| Result for | | | | | | | 101.6 |
| the period | | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Other items | | | | | | | |
--------------------------------------------------------------------------------
| Investments | 284.6 | 0.2 | 37.5 | 1.5 | 0.0 | 2.5 | 326.3 |
--------------------------------------------------------------------------------
| Depreciatio | 81.7 | 0.4 | 26.0 | 1.6 | 0.0 | 4.4 | 114.1 |
| n | | | | | | | |
--------------------------------------------------------------------------------
PRIMARY REPORTING FORMAT - BUSINESS SEGMENT DATA 1 January- 31 December 2006
--------------------------------------------------------------------------------
| | Sche-d | Lei-s | Avia-t | Travel | Group | Un- | Group |
| | uled | ure | ion | Servi-c | elimi-n | allo-ca | |
| | Pas-se | Traf- | Servi- | es | ations | ted | |
| | nger | fic | ces | | | items | |
| | Traffi | | | | | | |
| | c | | | | | | |
--------------------------------------------------------------------------------
| EUR mill. | | | | | | | |
--------------------------------------------------------------------------------
| External | 1 | 382.9 | 108.8 | 82.9 | | | 1 989.6 |
| turnover | 415.0 | | | | | | |
--------------------------------------------------------------------------------
| Internal | 107.1 | 3.9 | 298.7 | 4.5 | -414.2 | | 0.0 |
| turnover | | | | | | | |
--------------------------------------------------------------------------------
| Turnover | 1 | 386.8 | 407.5 | 87.4 | -414.2 | 0.0 | 1 989.6 |
| | 522.1 | | | | | | |
--------------------------------------------------------------------------------
| Operating | 28.6 | 18.4 | -34.9 | 2.3 | | -25.2 | -10.8 |
| profit | | | | | | | |
--------------------------------------------------------------------------------
| Share of | | | | | | 0.1 | 0.1 |
| results of | | | | | | | |
| associated | | | | | | | |
| undertakin | | | | | | | |
| gs | | | | | | | |
--------------------------------------------------------------------------------
| Financial | | | | | | 11.0 | 11.0 |
| income | | | | | | | |
--------------------------------------------------------------------------------
| Financial | | | | | | -15.0 | -15.0 |
| expenses | | | | | | | |
--------------------------------------------------------------------------------
| Income tax | | | | | | 1.7 | 1.7 |
--------------------------------------------------------------------------------
| Minority | | | | | | -0.6 | -0.6 |
| interest | | | | | | | |
--------------------------------------------------------------------------------
| Result for | | | | | | | -13.6 |
| the period | | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | | |
| items | | | | | | | |
--------------------------------------------------------------------------------
| Investment | 216.3 | 0.7 | 32.3 | 1.4 | 0.0 | 1.5 | 252.2 |
| s | | | | | | | |
--------------------------------------------------------------------------------
| Depreciati | 71.8 | 0.2 | 28.3 | 1.6 | 0.0 | 2.9 | 104.8 |
| on | | | | | | | |
--------------------------------------------------------------------------------
TURNOVER
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Oct- | 1 Oct | % |
| | 31 | 31 Dec | |
| | Dec | | |
--------------------------------------------------------------------------------
| EUR mill. | | | |
--------------------------------------------------------------------------------
| Scheduled Passenger | 427.5 | 375.1 | 14.0 |
| Traffic | | | |
--------------------------------------------------------------------------------
| Leisure Traffic | 119.8 | 104.3 | 14.9 |
--------------------------------------------------------------------------------
| Aviation Services | 113.4 | 106.2 | 6.8 |
--------------------------------------------------------------------------------
| Travel Services | 20.2 | 21.3 | -5.2 |
--------------------------------------------------------------------------------
| Group eliminations | -112.2 | -107.6 | 4.3 |
--------------------------------------------------------------------------------
| Total | 568.7 | 499.3 | 13.9 |
--------------------------------------------------------------------------------
TURNOVER
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Jan- | 1 Jan- | % |
| | 31 | 31 | |
| | Dec | Dec | |
--------------------------------------------------------------------------------
| EUR mill. | | | |
--------------------------------------------------------------------------------
| Scheduled Passenger | 1 685.3 | 1 522.1 | 10.7 |
| Traffic | | | |
--------------------------------------------------------------------------------
| Leisure Traffic | 409.6 | 386.8 | 5.9 |
--------------------------------------------------------------------------------
| Aviation Services | 433.9 | 407.5 | 6.5 |
--------------------------------------------------------------------------------
| Travel Services | 82.3 | 87.4 | -5.8 |
--------------------------------------------------------------------------------
| Group eliminations | -430.6 | -414.2 | 4.0 |
--------------------------------------------------------------------------------
| Total | 2 180.5 | 1 989.6 | 9.6 |
--------------------------------------------------------------------------------
OPERATING PROFIT EXCLUDING THE DISPOSAL OF THE CAPITAL ASSETS AND FAIR VALUE
CHANGES OF DERIVATIVES AND NON RESTRUCTURING ITEMS
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Oct- | 1 Oct | % |
| | 31 | 31 Dec | |
| | Dec | | |
--------------------------------------------------------------------------------
| EUR mill. | | | |
--------------------------------------------------------------------------------
| Scheduled Passenger | 20.0 | -9.0 | -322.2 |
| Traffic | | | |
--------------------------------------------------------------------------------
| Leisure Traffic | 9.7 | 3.1 | 212.9 |
--------------------------------------------------------------------------------
| Aviation Services | 3.0 | -15.0 | -120.0 |
--------------------------------------------------------------------------------
| Travel Services | -0.9 | 0.2 | -550.0 |
--------------------------------------------------------------------------------
| Unallocated items | -7.4 | -3.7 | 100.0 |
--------------------------------------------------------------------------------
| Total | 24.4 | -24.4 | -200.0 |
--------------------------------------------------------------------------------
OPERATING PROFIT EXCLUDING THE DISPOSAL OF THE CAPITAL ASSETS AND FAIR VALUE
CHANGES OF DERIVATIVES AND NON RESTRUCTURING ITEMS
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Jan- | 1 Jan- | % |
| | 31 Dec | 31 Dec | |
--------------------------------------------------------------------------------
| EUR mill. | | | |
--------------------------------------------------------------------------------
| Scheduled Passenger | 76.2 | 28.6 | 166.4 |
| Traffic | | | |
--------------------------------------------------------------------------------
| Leisure Traffic | 24.2 | 18.6 | 30.1 |
--------------------------------------------------------------------------------
| Aviation Services | 10.3 | -24.5 | -142.0 |
--------------------------------------------------------------------------------
| Travel Services | 2.9 | 2.3 | 26.1 |
--------------------------------------------------------------------------------
| Unallocated items | -17.0 | -13.8 | 23.2 |
--------------------------------------------------------------------------------
| Total | 96.6 | 11.2 | 762.5 |
--------------------------------------------------------------------------------
EMPLOYEES AVERAGE BY SEGMENT
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Jan- | 1 Jan- | % |
| | 31 Dec | 31 Dec | |
--------------------------------------------------------------------------------
| Scheduled Passenger Traffic | 4 151 | 4 114 | 0.9 |
--------------------------------------------------------------------------------
| Leisure Traffic | 372 | 343 | 8.5 |
--------------------------------------------------------------------------------
| Aviation Services | 3 674 | 3 771 | -2.6 |
--------------------------------------------------------------------------------
| Travel Services | 1 129 | 1 145 | -1.4 |
--------------------------------------------------------------------------------
| Other functions | 154 | 225 | -31.6 |
--------------------------------------------------------------------------------
| Finnair Group Total | 9 480 | 9 598 | -1.2 |
--------------------------------------------------------------------------------
SECONDARY REPORTING FORMAT - GEOGRAPHICAL SEGMENTS
TURNOVER OUTSIDE THE GROUP BY SALES DESTINATION
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Oct- | 1 Oct- | % |
| | 31 | 31 | |
| | Dec | Dec | |
--------------------------------------------------------------------------------
| EUR mill. | | | |
--------------------------------------------------------------------------------
| Finland | 111.2 | 112.3 | -1.0 |
--------------------------------------------------------------------------------
| Europe | 230.6 | 219.8 | 4.9 |
--------------------------------------------------------------------------------
| Asia | 185.9 | 134.9 | 37.8 |
--------------------------------------------------------------------------------
| North America | 13.7 | 13.6 | 0.7 |
--------------------------------------------------------------------------------
| Others | 27.3 | 18.7 | 46.0 |
--------------------------------------------------------------------------------
| Total | 568.7 | 499.3 | 13.9 |
--------------------------------------------------------------------------------
TURNOVER OUTSIDE THE GROUP BY SALES DESTINATION
--------------------------------------------------------------------------------
| | 2007 | 2006 | Change |
--------------------------------------------------------------------------------
| | 1 Jan- | 1 Jan- | % |
| | 31 Dec | 31 Dec | |
--------------------------------------------------------------------------------
| EUR mill. | | | |
--------------------------------------------------------------------------------
| Finland | 419.7 | 436.7 | -3.9 |
--------------------------------------------------------------------------------
| Europe | 992.8 | 936.5 | 6.0 |
--------------------------------------------------------------------------------
| Asia | 626.3 | 482.0 | 29.9 |
--------------------------------------------------------------------------------
| North America | 63.2 | 66.4 | -4.8 |
--------------------------------------------------------------------------------
| Others | 78.5 | 68.0 | 15.4 |
--------------------------------------------------------------------------------
| Total | 2 180.5 | 1 989.6 | 9.6 |
--------------------------------------------------------------------------------
4. COMPANY ACQUISITIONS AND SALES
In January 2007, the Group's subsidiary Oy Aurinkomatkat-Suntours Ltd Ab
acquired all the shares of Oy Matkayhtymä AB, and in April 2007, 95 per cent of
the shares of the Estonian company Horizon Travel A/S. The company acquisitions
have no substantial impact on the figures of the consolidated interim report.
The gross investment in the shares was 0.6 million euros.
On 30 June 2007 the final contract of sale was signed with Norwegian Air Shuttle
on the sale of the shares of the Group's subsidiary FlyNordic. The transaction
was completed on 30 July 2007. The selling price was paid in the form of new
shares of Norwegian Air Shuttle ASA as well as options which can be exercised to
redeem additional shares.
On 23 October 2007, Oy Aurinkomatkat-Suntours - Suntours Ltd Ab signed an
agreement by which it purchased a majority shareholding of all three Russian
companies belonging to the Calypso Group. The deal was finalised in January
2008.
On 2 November 2007, Northport Oy signed an agreement with Menzies Aviation Plc
on the sale of Northport Oy's ground handling operations in Sweden and Norway.
5. INTEREST-BEARING LIABILITIES
During the second quarter of 2007, the Group's subsidiary Finnair Aircraft
Finance Oy raised a new long-term loan from Nordea in order to finance the
Group's aircraft fleet investment programme, which is currently under way. The
secured constant repayment loan was raised for 10 years. The capital of the loan
is 49.5 million euros and three E170 aircraft were lodged as security. Finnair
pension fund loan 28.0 million euros has totally paid in December. The remaining
loan withdrawals presented in the accounts relate to old secured loans, which
owing to their exceptional agreement structure have a net repayment entered
gross both as a withdrawal and a repayment.
6. SHARE ISSUE
In the final quarter of 2007, Finnair arranged a share issue in which
shareholders could subscribe for four new shares for every nine shares held. The
subscription price was 6.30 euros per share. The money raised in the share issue
increased shareholders' equity by 244.9 million euros. The change in
shareholders' equity takes into account expenses and deferred tax related to
them.
7. CONTINGENT LIABILITIES AND DERIVATIVE CONTRACTS EUR mill.
--------------------------------------------------------------------------------
| | 31 Dec 2007 | 31 Dec 2006 |
--------------------------------------------------------------------------------
| Other contingent liabilities | 263.1 | 236.9 |
--------------------------------------------------------------------------------
| Pledges on own behalf | 633.9 | 536.3 |
--------------------------------------------------------------------------------
| Total | 897.0 | 773.2 |
--------------------------------------------------------------------------------
| Fleet lease payment liabilities | 324.8 | 389.8 |
--------------------------------------------------------------------------------
| Other liabilities | 177.7 | 180.8 |
--------------------------------------------------------------------------------
| Total | 1 399.5 | 1 343.8 |
--------------------------------------------------------------------------------
Investment commitments for tangible fixed assets at 31 December 2007 totalled
1,311.1 million euros (31 December 2006: 458.7 million euros)
--------------------------------------------------------------------------------
| Derivative contracts | 31 Dec 2007 | 31 Dec 2006 |
--------------------------------------------------------------------------------
| Currency derivatives | Nominal | Fair value | Nominal | Fair value |
| | value (EUR | (EUR | value (EUR | (EUR |
| | mill.) | mill.) | mill.) | mill.) |
--------------------------------------------------------------------------------
| Hedge accounting | | | | |
| items (forward | | | | |
| contracts) | | | | |
--------------------------------------------------------------------------------
| Jet Fuel currency | 267.0 | -20.0 | 260.2 | -8.2 |
| hedging | | | | |
--------------------------------------------------------------------------------
| Hedging of Aircraft | | | | |
| purchase price | | | | |
--------------------------------------------------------------------------------
| Fair value hedge | 373.5 | -14.3 | 186.2 | -2.9 |
--------------------------------------------------------------------------------
| Cash flow hedge | 89.5 | -2.6 | 138.5 | -6.2 |
--------------------------------------------------------------------------------
| Currency hedge of | 56.3 | -3.9 | 63.8 | -1.9 |
| lease payments | | | | |
--------------------------------------------------------------------------------
| Hedge accounting | 786.3 | -40.8 | 648.7 | -19.2 |
| items, total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Currency derivatives | | | | |
| at fair value | | | | |
| through profit or | | | | |
| loss | | | | |
--------------------------------------------------------------------------------
| Operating cash flow | 2.7 | 0.0 | 26.7 | -1.3 |
| hedging (forward | | | | |
| contracts) | | | | |
--------------------------------------------------------------------------------
| Operational cash | | | | |
| flow hedging | | | | |
| (options) | | | | |
--------------------------------------------------------------------------------
| Call options | 54.3 | 0.1 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Put options | 64.5 | -0.6 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
| Balance sheet | 47.2 | -0.6 | 94.1 | -0.6 |
| hedging (forward | | | | |
| contracts) | | | | |
--------------------------------------------------------------------------------
| Total | 168.7 | -1.1 | 120.9 | -2.0 |
--------------------------------------------------------------------------------
| Currency | 955.0 | -41.9 | 769.5 | -21.2 |
| derivatives, total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 31 Dec 2007 | 31 Dec 2006 |
--------------------------------------------------------------------------------
| | Nominal | Fair value | Nominal | Fair value |
| | value | (EUR | value | (EUR |
| | (tonnes) | mill.) | (tonnes) | mill.) |
--------------------------------------------------------------------------------
| Commodity | | | | |
| derivatives | | | | |
--------------------------------------------------------------------------------
| Hedge accounting | | | | |
| items | | | | |
--------------------------------------------------------------------------------
| Jet Fuel forward | 562 750 | 55.3 | 510 400 | -12.8 |
| contracts | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Commodity | | | | |
| derivatives at fair | | | | |
| value through profit | | | | |
| or loss | | | | |
--------------------------------------------------------------------------------
| Jet Fuel forward | 11 100 | 0.6 | 79 300 | -5.1 |
| contracts | | | | |
--------------------------------------------------------------------------------
| Gasoil forward | 21 900 | 2.7 | 0 | 0.0 |
| contracts | | | | |
--------------------------------------------------------------------------------
| Jet differential | 395 000 | 1.1 | 112 500 | 0.0 |
| forward contracts | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Options | | | | |
--------------------------------------------------------------------------------
| Jet Fuel call | 64 500 | 2.0 | 35 000 | 0.3 |
| options | | | | |
--------------------------------------------------------------------------------
| Jet Fuel put options | 76 000 | -0.7 | 70 000 | -0.5 |
--------------------------------------------------------------------------------
| Gasoil call options | 48 500 | 3.1 | 9 000 | 0.0 |
--------------------------------------------------------------------------------
| Gasoil put options | 86 500 | -0.5 | 18 000 | 0.0 |
--------------------------------------------------------------------------------
| Total | | 63.5 | | -18.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Derivative contracts | | | | |
--------------------------------------------------------------------------------
| | 31 Dec 2007 | 31 Dec 2006 |
--------------------------------------------------------------------------------
| | Nominal | Fair value | Nominal | Fair value |
| | value (EUR | (EUR | value (EUR | (EUR |
| | mill.) | mill.) | mill.) | mill.) |
--------------------------------------------------------------------------------
| Interest rate | | | | |
| derivatives | | | | |
--------------------------------------------------------------------------------
| Cross currency | | | | |
| Interest rate swaps | | | | |
--------------------------------------------------------------------------------
| Hedge accounting | 26.9 | -13.6 | 42.5 | -15.2 |
| items | | | | |
--------------------------------------------------------------------------------
| Cross currency | 15.4 | -10.1 | 22.1 | -10.7 |
| interest rate swaps | | | | |
| at fair value | | | | |
| through profit or | | | | |
| loss | | | | |
--------------------------------------------------------------------------------
| Total | 42.3 | -23.7 | 64.7 | -25.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest rate swaps | | | | |
--------------------------------------------------------------------------------
| Hedge accounting | 0.0 | 0.0 | 0.0 | 0.0 |
| items | | | | |
--------------------------------------------------------------------------------
| Interest rate swaps | 20.0 | 0.9 | 20.0 | 1.0 |
| at fair value | | | | |
| through profit or | | | | |
| loss | | | | |
--------------------------------------------------------------------------------
| Total | 20.0 | 0.9 | 20.0 | 1.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share derivatives | | | | |
--------------------------------------------------------------------------------
| Options | | | | |
--------------------------------------------------------------------------------
| Call option, shares | 16.1 | 8.4 | 0.0 | 0.0 |
--------------------------------------------------------------------------------
8. AIR TRAFFIC 1 January - 31 December 2007
--------------------------------------------------------------------------------
| | Total | Europe | North | Asia |
| | traffic | | Americ | |
| | | | a | |
--------------------------------------------------------------------------------
| Passengers | 8 653 | 4 486 | 140 | 1 131 |
| (1000) | | | | |
--------------------------------------------------------------------------------
| %-change | -1.6 | -0.3 | -2.1 | 27.1 |
--------------------------------------------------------------------------------
| Cargo and mail | 98 684 | 22 393 | 7 401 | 59 165 |
| (tonnes) | | | | |
--------------------------------------------------------------------------------
| %-change | 5.2 | -3.7 | -9.0 | 24.5 |
--------------------------------------------------------------------------------
| Available | 26 878 | 8 641 | 1 102 | 10 292 |
| seat-kilometres | | | | |
| mill | | | | |
--------------------------------------------------------------------------------
| %-change | 12.7 | 10.9 | -3.2 | 31.8 |
--------------------------------------------------------------------------------
| Revenue | 20 304 | 5 855 | 923 | 8 018 |
| passenger | | | | |
| kilometres | | | | |
--------------------------------------------------------------------------------
| %-change | 13.3 | 11.3 | -2.1 | 32.6 |
--------------------------------------------------------------------------------
| Passenger load | 75.5 | 67.8 | 83.8 | 77.9 |
| factor % | | | | |
--------------------------------------------------------------------------------
| %-change | 0.4 | 0.3 | 0.9 | 0.5 |
--------------------------------------------------------------------------------
| Available | 4 074 | | | |
| tonne-kilometre | | | | |
| s | | | | |
--------------------------------------------------------------------------------
| %-change | 13.1 | | | |
--------------------------------------------------------------------------------
| Revenue | 2 365 | | | |
| tonne-kilometre | | | | |
| s mill | | | | |
--------------------------------------------------------------------------------
| %-change | 12.6 | | | |
--------------------------------------------------------------------------------
| Overall load | 58.0 | | | |
| factor % | | | | |
--------------------------------------------------------------------------------
| %-change | -0.2 | | | |
--------------------------------------------------------------------------------
* Operational calculatory capacity
8. AIR TRAFFIC 1 January - 31 December 2007
--------------------------------------------------------------------------------
| | Domestic | Scheduled | Leisure | Cargo |
| | | Traffic | | |
| | | Total | | |
--------------------------------------------------------------------------------
| Passengers (1000) | 1 701 | 7 458 | 1 195 | |
--------------------------------------------------------------------------------
| %-change | -15.6 | -1.2 | -3.7 | |
--------------------------------------------------------------------------------
| Cargo and mail (tonnes) | 3 335 | 92 294 | 459 | 98 684 |
--------------------------------------------------------------------------------
| %-change | -13.5 | 11.5 | 23.2 | 5.2 |
--------------------------------------------------------------------------------
| Available | 1 479 | 21 514 | 5 365 | |
| seat-kilometres mill | | | | |
--------------------------------------------------------------------------------
| %-change | -15.8 | 16.3 | 0.3 | |
--------------------------------------------------------------------------------
| Revenue passenger | 894 | 15 689 | 4 615 | |
| kilometres | | | | |
--------------------------------------------------------------------------------
| %-change | -10.4 | 18.5 | -1.4 | |
--------------------------------------------------------------------------------
| Passenger load factor % | 60.5 | 72.9 | 86.0 | |
--------------------------------------------------------------------------------
| %-change | 3.6 | 1.3 | -1.4 | |
--------------------------------------------------------------------------------
| Available | | | | 1 019 |
| tonne-kilometres | | | | |
--------------------------------------------------------------------------------
| %-change | | | | 30.0 |
--------------------------------------------------------------------------------
| Revenue | | | | 547 |
| tonne-kilometres mill | | | | |
--------------------------------------------------------------------------------
| %-change | | | | 9.8 |
--------------------------------------------------------------------------------
| Overall load factor % | | | | 53.7 * |
--------------------------------------------------------------------------------
| %-change | | | | -9.9 |
--------------------------------------------------------------------------------
* Operational calculatory capacity
9. EVENTS AFTER THE REVIEW PERIOD
On 23 October 2007, Oy Aurinkomatkat-Suntours Ltd Ab signed an agreement by
which it purchased a majority shareholding of all three Russian companies
belonging to the Calypso Group. The deal was finalised in January 2008.
The opening of a new catering building, owned by the Finnair Pension Fund, will
take place in February 2008. As the agreement in question is of a long-term
nature, it will be recognised as a finance leasing agreement in accordance with
IFRS.
