Second Quarter 2004 - SAS – Welcome to SAS … in May 2004 –Boeing 737 fleet only lounge access...

Second Quarter 2004

Group | Scandinavian Airlines Operations| Subsidiary & Affiliated Airlines | Airline Support Business | Airline Related Business |Hotels

Analyst meetingStockholm, August 11, 2004

2

MSEK, April-June 2004 2003 Change

� Revenues 15 143 15 300 -157� EBITDAR 1 493 1 608 -115

� Lease, depreciation & financial net -1 589 -1 692 -103

� EBT bef. cap gains *) 9 -13 +22

� *) Ex restructuring costs of MSEK 75 (44)

Second quarter marginally positive despite strong yield pressure and record high jet fuel prices

Group | Scandinavian Airlines Operations | Subsidiary & Affiliated Airlines | Airline Support | Airline Related Business |Hotels

3

Unprecedented yield fall and record high jet fuel prices offset by significant cost reductions1st Half 2004� Traffic revenues down MSEK 1 900 due to yield pressure� Currency and volume adjusted fuel costs up approx 500 MSEK � Exceptionally strong pressure on yields but volumes up

� Yields down (currency adjusted) 16% – Scandinavian Airlines� Group traffic up 11%

� Negative impact offset by large unit cost reduction� Turnaround 2005 ahead of plan� Unit cost (currency adjusted) for SK down 14% first half 23% accumulated vs

2002. Large reduction in European perspective.

First half earnings before taxes and exceptionalsimproved with MSEK 300 vs. last year


4

Other important events 2nd Quarter and summer period

� SAS Braathens successfully launched on the Norwegian market

� Scandinavian Airlines transported a record number of intercontinental passengers

� Process to incorporate Business units initiated –� Implemented Oct 1 2004

� Scandinavian Airlines has signed more than 300 new corporate agreements with small and medium size companies

� Blue 1 introduces Finnish domestic routes

� The Norwegian Competition Authority examines price structures on the Norwegian market


5

Why our statement that a positive result is difficult to achieve in 2004?

� The year started with weak demand� Significant increased capacity in Scandinavia from a number of new start up airlines

� New players

=> overcapacity and low cabin factors => very low average prices

� Record high oil prices

� As from June price increases to offset Jet Fuel as well as improved yield management initiated by the largest operator: SAS Group

� Yield development improved in June – uncertainties due to overcapacity situation

Strong 2nd Quarter result not achievable

a non sustainable situation


6

Prices in Scandinavia now among the lowest in Europe…

�Table based on CRS bookings only

�“Sweden has the lowest leisure fares” (Source: Swedish Aviation Authority –Flygets utveckling 2003)

American Express (European Corporate Travel Index). Report Q1, 2004


7

SAS Group market position stable

Market shares� Continued tough market conditions,

but improving volumes and macro outlook

� Norway domestic – market share stable around 85%

� Sweden domestic – market share around 60%

� Within Scandinavia – market share 60-90%

� To/from Europe – between 35-50%

� Intercontinental – market share 25-30%


The SAS Group position as the 4th largest airline group in Europe retained

SAS Group number 12 world wide9

Revenues 2 446 -12,5% 3 066 9,7% 1 401 -4,5%

EBITDA 246 48% 92 n.m 34 -21%

EBT 69 n.m 29 n.m 1 n.m

Jan-Jun in MSEK

Strong performance fromAirline Support Businesses in Q2


10

Revenues 800 6,4% 276 3,8% 230 1,8%

EBITDA -12 n.m 78 26% 20 33%

EBT -24 n.m 31 181% 9 -18%

Jan-Jun in MSEK

Flight Academy and Jetpak on trackWeak result from SAS Trading

SAS Trading


11


Very promising start for SAS Braathens in Norway – to continue to build onBraathens strong profitability

� Operative in May 2004 –Boeing 737 fleet only� New web site – 2nd most popular in Norway� New price concepts – one way pricing� Appr. 50 aircraft and 35 destinations - 440 daily departures� Stable market share domestic appr. 85%� Braathens today one of few European Airlines delivering shareholder

returns

Braathens April-June 2004 2003Total revenues 1 685 1 736EBITDAR 389 274EBIT 204 83EBT 200 73

12

Updated market segmentation and analysis of customer priorities

� Business- and Economy Class are 25 year old concepts in the airline industry

� Current concepts does not fully match the rational needs and emotional preferences of customers

� The competitive environment and products have changed in the European airline industry

� Three segments have been identified for the new commercial strategies

Price

Productivity

Comfort

Customers looking for air transportation at low prices

Customers who value hassle-free traveling and time-saving features

Customers who also value additional comfort such as lounge access and better inflight service

40-45% 30-40% 20-30%Estimated share of passengers


13

After successfully reducing costs SAS committed to vitalize approach to the market

� Next step: Vitalized offer from Scandinavian Airlines Denmark, Sweden and from SAS Braathens to be introduced during fall 2004

� The approach is based on market segmentation study of customer priorities� Platform: Network carrier at low cost� Today’s travelers want freedom of choice: flexible and cheap travel

– Focus on Business travelers as well as leisure travelers– Improved service for Business travelers demanding extra comfort

� Low fare offer expanded through the introduction of Snowflake throughout most of SAS network1)

– Scandinavia’s largest low fare provider� Details to be presented by the Danish, Swedish and Norwegian CEO’s on

August 23

1) SASBraathens established as low fare concept in Norwegian market


14

Snowflake and SAS Braathens symbols for lowest available fares


March 2003� Branded flights only

� Branded flights and seats on selected Scandinavian Airlines destinations

� SAS Braathens to/from Norway

� Branded flights� Symbol for the lowest available

fares on most Scandinavian Airlines routes

� SAS Braathens to/from Norway

Summer 2004

New

Gunilla BergCFO

16

January – June ChangeMSEK 2004 vs. 2003

Cost savings more than offset yield decline and increased jet fuel costs


-3,2

2,7

-0,5

1,3

0,3

-4,0

-3,0

-2,0

-1,0

0,0

1,0

2,0

3,0

Yield Turnaround 2005 Fuel Other includingvolume

EBT beforeexceptionals

17

Q2 April-June April-Jun Q2 January-JuneBusiness area 2004 Change 2004Scandinavian Airlines -223 -68 -1 331Subsidiary & Aff. Airlines 239 19 -48Airline Support Businesses 130 137 138Airline Related Businesses 10 -30 22Hotels 7 48 -93Group eliminations, other -154 -84 -310

EBT, before gains & exceptionals 9 22 -1 622

EBT before gains and exceptionals -Business area


18

SAS Group’s strong liquid position and significant committed facilities

MSEKLiquid Funds June 30 - 2004 8 829

Available Credit Facilites:Revolving Credit Facility (MEUR 400) 900Aircraft Finance Lease Facility 1 800Bi-lateral Facilities 1 600Others 250Total Available Facilities 4 550

Total Available Funds 13 379


19

Yield and traffic development

Yield, April-June RPK, April-June

-16,3% 12,5%

-12,5% 19,9%

-9,4% 9,3%

-13,0% 14,3%

-27,4% 84,9%


20

Reduced yield pressure for June and indications for July positive

Total yield change vs last year

-25%

-20%

-15%

-10%

-5%

0%

Jan Mar May jul Sep Nov Jan Mar May


2003 2004

21

Yield enhancements under implementation…

� Commercial Strategies– Focus on added value for the customer– More info August 23

� Price adjustments in Sweden and Denmark– In Denmark fare adjusted with DKK 50-200/leg– In Norway fare adjusted with NOK 40-90 as from August 17th

– In Swedish fare adjusted with SEK 50-75/leg� Active yield management

– Reduced number of low fare tickets during peaks� System improvements� Jet fuel surcharge – will be neutralized by higher fuel costs� SAS Corporate agreements focus on small and medium sized customers.

More than 300 new contracts signed in 2004

Group | Mainline Airline Operations | Subsidiary & Affiliated Airlines | Airline Support Business | Airline Related Business |Hotels

22

Unit cost continues to improve significantly - down 23% since 2002

� 9th Quarter in a row with improved unit cost

� Unit cost in Q2 down by 12%– Adjusted for jet fuel price

increases unit cost down by 15%

– Accumulated unit cost down 23% since 2Q 2002

� One of largest reductions among European Airlines

-25%

-20%

-15%

-10%

-5%

0%

1st Q2003

2nd Q2003

3rd Q2003

4th Q2003

1st Q2004

2nd Q2004

Index last year, EBITDAR level(currency adjusted) Scandinavian Airlines


23

9200 9800

4800 4200

0

2000

4000

6000

8000

10000

12000

14000

Plan Status Jun 2004

SAS Group –Turnaround 2005 ahead of plan

1400 1450

Reduction of personnelTotal financial effect of implemented activities compared to plan

MSEK

To be implemented Implemented

3600 3550

2400 2450

0

1000

2000

3000

4000

5000

6000

Plan Status Jun 2004

66% 70%60% 59%

14 000 14 000 6 000 6 000


24

Share of sales over Internet has increased steadily

02468

101214161820

Jan

Feb Mar AprMay Ju

n jul Aug Sep Oct Nov Dec Jan

Feb Mar AprMay Ju

n

% Sold via Internet

� Approximately 18% of bookings on Scandinavian Airlines homepage in the first quarter 2004


%

25

Estimated result effects SEK 14 billion from Turnaround 2005

3,6

6

3,8

0,6

0

1

2

3

4

5

6

7

2003 2004 2005 2006

2003200420052006


Jørgen LindegaardCEO

27

Spanair on track

Hit by 23% increased jet fuel costs in Q2 �Most punctual in Europe in February�One way prices on whole system�New Business Class setup well received�Traffic up 19,9% �Yields down 12% �Unit cost down 13% in 1st Half�Jet fuel costs up MSEK 107 in Q2�Positive expectations for 2004


April-June 2004 2003Total revenues 2 057 1 997EBITDAR 347 382EBIT 84 101EBT 71 86

28

Widerøe continued very strong, Blue1 break even

Widerøe very strong performance�Stronger revenues than expected�Improved efficiency as Turnaround 2005 take effect�Traffic up 14,6%�Decreasing yield compensated by improved efficiency

Successful launch of Finnish domestic operations�New Internet site�Blue1 traffic increased 84,9% as new routes were introduced.�Finnish domestic cabin factor over 60%�Unit cost down 21%, but result negatively affected by cost for new identity and phasing in of new aircraft

April-June 2004 2003Total revenues 642 647EBITDAR 101 112EBIT 77 58EBT 37 43

April-June 2004 2003Total revenues 345 262EBITDAR 42 55EBIT 3 19EBT 0 16


29


April-June January-June

MSEK 2004 2003 2004 2003� Revenues 1 121 903 2 039 1 745� Operating

expensives -1 084 -904 -2 059 -1 821� EBITDA 37 -1 -20 -76� Adjusted EBITDA 45 4 -5 -72� EBIT 6 -28 -82 -135

� EBT 7 -39 -93 -154

Recovery in the marketplace and effects from Turnaround 2005�Number of rooms sold increased

� Price pressure reduced� REVPAR increased 3%

�Revenues up 17% driven by new units�Unit cost sharp down

Hotels back in black numbers 2nd Quarter – mostly driven by the new hotel brands

�Market share position unchanged�Number of hotels in operation increased 11% (from 162 to 180)

�New hotels have significantly contributed to improved result

�7 new Radisson SAS hotels and 15 Park Inn, and 1 Regent hotels opened in the first half 2004

30

With full effect from Turnaround 2005, Scandinavian

Airlines will reach unit cost in the same level as Low Cost Carriers given

same stage length

Scandinavian Airlines to improve efficiency and reach close to level of LCC

Uni

t cos

t

SEK/

ASK Scandinavian Airlines in 2002/03

App. 1,40

App. 0,85App. 0,75-0,85

450 km Stage length

LCC

AEA

App. 1,25

Current position apr. 1,05 SEK/ASK


Scandinavian Airlines after full Turnaround 2005

31

�Very difficult trading conditions

– 1st Half –high fuel prices and yield pressure� Turnaround 2005 according to plan

– Unit cost reductions so far up to 23% for Scandinavian - large reduction in European perspective

�Yield improvements expected in second half– Still uncertainties due to overcapacity situation– Strong performance by several business units

� New Commercial strategies to repossess initiative– Snowflake expanded to most of network– To be presented in details August 23

Sum up 1st half 2004


33

Additional slides for further information

34

Unit cost

EBIT margin

CFROI

Competitive unit cost in each traffic flow at the same level as most competitive airline

Average CFROI of at least 20%.

Corresponds to approximately 10% EBIT-margin


Unit cost for SK Down 30-35% vs. 2002

SAS Group key objectives

35Group | Scandinavian Airlines Operations | Subsidiary & Affiliated Airlines | Airline Support | Airline Related Business |Hotels

Unit cost for Scandinavian Airlines has gone down by 25% vs 2002

0,7

0,8

0,9

1

1,1

1,2

Jan

MarMay Ju

lSepNov Ja

n

MarMay Ju

lSepNov Ja

n

MarMay

SEK/RPK

Unit cost 25% lower than Q2

2002

36

Implementation of new hubs proceeding according to plan

Group | Scandinavian Airlines Operations | Subsidiary & Affiliated Airlines | Airline Support Business | Airline Related Business |Hotels

Organization changes� Fleet allocation as from summer program 2003� Administration as from August 2003� Cabin crew in Q2 2004� Pilots in October/November 2004� Legal entities as from October 2004� Fully implemented in Q4 2004

Advantages with new national airlines� More efficient and flexible units

– To serve the home market better� Reduced complexity� Agreements on local market levels

– Closer to the customers

37

Scandinavian Airlines already able to compete successfully

� Unit cost 23% lower than 2002� Costs reduced by more than MSEK 1 500 in Q2 2004 vs Q2 2002� Unit cost will have improved 30-35% in 2005 compared with 2002


As a result�Scandinavian Airlines cost level already very competitive�Winning major charter contracts for 2005 as utilization improves and cost level is competitive

TransparencyAccountability

CompetitivenessIndependence

The SAS Group new structure as from October 2004

41

Legal structure to be implemented

Upstream guarantee to SAS Consortium

Downstream guarantee to SAS Consortium

Ticket revenue flows

The SAS Consortium will still be the main vehicle for assets, revenues and leasing

Business risks and operating costs in new subsidiary airlines

Group | Mainline Airline Operations | Subsidiary & Affiliated Airlines | Airline Support Business | Airline Related Business |Hotels42

Strategies going forward

� Complete Turnaround 2005– Reduce Scandinavian Airlines unit cost by 30-35% vs 2002– Improve productivity significantly– Independent hubs in Copenhagen, Oslo and Stockholm– Complete final redundancies

� Implement positive yield measures– Yield management– Jet fuel surcharge– Fare adjustments

� Implementation of Commercial Turnaround– Expected to be launched in August/September


43

SAS Group objectives in the coming five year period are:

– To achive an average CFROI of at least 20%– To increase the Group’s share of the Northern European

airline market

– For each unit to achieve its customer satisfaction, employee satisfaction and environmental impact objectives

– For airline operations to achieve their flight safety targets

– Consolidated balance sheet


44

April-June January-JuneBusiness area vs. LY vs. LYScandinavian Airlines -7,9% -10,8%Subsidiary & Aff. Airlines 1,8% -0,3%Airline Support Businesses 1,7% -2,0%Airline Related Businesses* -36,8% -39,6%Hotels 24,1% 16,8%

SAS Group -1,0% -4,5%

Revenue development per business area


* In December 2003 Scandinavian IT Group was sold

45

Income for Subsidiary & Affiliated Airlines improved


MSEK, April-June 2004 2003 Change

� Revenues 15 143 15 300 -1%� Operating expenses -13 650 -13 692 -0%� EBITDAR 1 493 1 608 -7%

� Lease -678 -719 -6%� EBITDA 815 889 -8%

� Depreciation -704 -780 -10%� Income from sales/affiliated 96 163 -41%� EBIT 207 272 -24%

� EBT bef. cap gains 9 -13 n.m.� EBT incl. gains 0 87 n.m.

46

200

230

260

290

320

350

380

30-ju

n-03

30-au

g-03

30-ok

t-03

30-d

ec-0

3

29-fe

b-04

30-ap

r-04

30-ju

n-04

USD

/ M

T

April-June affected negatively by MSEK 481 higher jet fuel costs

�Jet fuel prices have been 49% higher i 1H vs. Last year�SAS Group has 33% hedge in place for 4th Quarter


Q2

47

…but yield level is not sustainable on many traffic flows for even most efficient carrier

Example on major flow in Scandinavia

80

90

100

110

120

130

140

150

160

170

jan-03 feb-03 mar-03apr-03 maj-03 jun-03 jul-03 aug-03 sep-03okt-03 nov-03dec-03 jan-04 feb-04 mar-04apr-04

Yield (12 m moving) EFCYield (month)


48

SAS Group revenue development

-20-15-10

-505

101520253035

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2


% vs. Last year

2002 vs 2001 2003 vs 2002 2004 vs 2003

49

� June revenue 2004 slightly exceeds previous year– higher volumes – Reduced yield decline

Revenue seasonality pattern


jan feb mar apr maj jun jul aug sep okt nov dec

1999

2000

2001

2002

2003

2004

Gro

up R

even

ue

50

Quarterly results 2003-2004

EBT bef gains, restructuring and exceptionalsMSEK

-1909

116

-415

-1631

9-13

-2 500

-2 000

-1 500

-1 000

-500

0

500

Q1 Q2 Q3 Q4 Q1 Q2


51

-1 400

-1 200

-1 000

-800

-600

-400

-200

0

200

400

600

Q2 Q3 Q4 Q1 Q2

Group results have improved significantly since second quarter 2003

EBT change before gains and exceptionals vs. Last yearMSEK


52

SAS Group EBITDAR and CFROI

MSEK, January-June 2004 2003

� Revenue 27 710 29 010 -4,5%

� EBITDAR 1 449 1 210 20%

� EBITDAR-margin 5,2% 4,2% +1,0 p.p.

� CFROI 8% 8% 0 p.p.


53

SAS Group – Quarterly EBT

EBT bef gainsMSEK million

77 142

-591

-1613

-1313

1180

50

-809

-1909

-13116

-415

-1631

9

-2 500

-2 000

-1 500

-1 000

-500

0

500

1 000

1 500

Q1 Q2 Q3 Q4

2001 2002 2003 2004

Group | Scandinavian Airlines | Subsidiary & Affiliated Airlines | Airline Support Business | Airline Related Business |Hotels

54

EBITDAR development

EBITDAR MSEK

� EBITDAR in Q2 2004 was 1 493 (1 608) MSEK

EBITDAR – Scandin Airl. 497 MSEK– Braathens 390 MSEK– Spanair 346 MSEK– Widerøe 101 MSEK– Blue1 42 MSEK-1 000

-500

0

500

1 000

1 500

2 000

2 500

3 000

3 500

Q1 Q2 Q3 Q4

2001 2002 2003 2004

Group | Scandinavian Airlines Operations| Subsidiary & Affiliated Airlines | Airline Support | Airline Related Business |Hotels

55

Brent Crude vs. Jet FuelJanuary 1998 to Date

Group | Scandinavian Airlines | Subsidiary & Affiliated Airlines | Airline Support Business | Airline Related Business |Hotels

0

10

20

30

40

50

60

1998

-01-02

1998

-03-30

1998

-06-26

1998

-09-21

1998

-12-16

1999

-03-16

1999

-06-15

1999

-09-08

1999

-12-01

2000

-02-29

2000

-05-26

2000

-08-21

2000

-11-14

2001

-02-12

2001

-05-10

2001

-08-03

2001

-10-30

2002

-01-25

2002

-04-24

2002

-07-23

2002

-10-15

2003

-01-10

2003

-04-04

2003

-07-02

2003

-09-26

2003

-12-19

2004

-03-17

2004

-06-16

US

Dol

lar p

er B

arre

l

0

50

100

150

200

250

300

350

400

450

500

US D

ollar per Metric Ton

Brent 1st Nearby Close

Jet CIF Cargoes NWE

56

Record high jet fuel prices-Average rate 49% higher in Q2 vs 2003

� Average market prices:� 2000 297 USD/MT� 2001 245 USD/MT� 2002 233 USD/MT� 2003 282 USD/MT� Q1 2003 323 USD/MT� Q2 2003 244 USD/MT� Q3 2003 264 USD/MT� Q4 2003 298 USD/MT� Q1 2004 322 USD/MT� Q2 2004 365 USD/MT


Jet fuel hedged 33% forQ4 2004

57Group | Scandinavian Airlines Operations | Subsidiary & Affiliated Airlines | Airline Support | Airline Related Business |Hotels

58

Turnaround 2005 business follow up a complement to existing follow up systems

Steering of businesses and business units

Follow up activity

FTEFollow up KPI

Budget and Business Plans

• Steering of units on bottom line and include all effects of Turnaround 2005

• Follow up through normal reporting

– Follow up of existing KPIs

– KPIs on unit level task force and activity level

– Follow up status negotiations

– Follow up FTE reductions

– Follow up ofactivities vs plan

Group | Scandinavian Airlines Operations | Subsidiary & Affiliated Airlines | Airline Support | Airline Related Business |Hotels59

Decided and under implementation in Turnaround 2005

2,1

2,8 0,71,5

1,01,6

2,81,5 14,0

0

2

4

6

8

10

12

14

16

OverheadfunctionsSK/group

wide

Productionconcept - SK

Inflight - SK Distribution &Sales - SK

SGS STS SubsidiaryAirlines &

Hotels

Newagreements

Total

Scandinavian Airlines 1,2- Pilots 0,7, Cabin 0,4, other 0,1Other 0,3


60

Distribution of cost reductions in Turnaround 2005 by cost category

49%

11%

11%

9%

6%5%

Personnel SalesGround Handling & Technical InflightAircraft lease ITOther


61

30 000

31 000

32 000

33 000

34 000

35 000

36 000

JAN

-02

MA

R

MA

J

JUL

SEP

NO

V

JAN

-03

MA

R

MA

J

JUL

SEP

NO

V

JAN

-04

MA

R

MA

J

JUL

SEP

NO

V

Actual Forecast

Number of personnel development for the SAS Group

Outcome: 33 462

Forecast: 33 072


62

Block hours for Group Airlines in 2004

Majority owned Airlines Jan- Jun 2004 Pilots/year

Scandinavian Airlines 562

Spanair

Braathens

Widerøe

Blue1

Air craft/day Cabin/year

8,3

7,9

8,0

6,7

8,1

537

655

552

540

712

882

540

496

773


63

11001000

300

150 150

0

200

400

600

800

1000

1200

Spanair Braathens Widerøe Blue1 Hotels

Turnaround 2005 amounting to MSEK 2 800 for Subsidiary Airlines and Hotels

MSEK

� Initiated in April 2003� Total measures of at

least MSEK 2 800� Most of measures will

give effect in 2004


64

Internet check in has doubled but from low levels

0%

5%

10%

15%

20%

25%

30%

35%

40%

20021

120

0212

2003

0120

0302

2003

0320

0304

2003

0520

0306

2003

0720

0308

2003

0920

0310

2003

1120

0312

20040

120

0402

2004

0320

0404

2004

0520

0406

Automat Internet


� Target to increase Self Service check in to 60% in 2005� Internet check low, but has doubled in 2004

65

Cost distribution on a 400 km flightOslo-Stockholm

“The Efficient Airline”� Payroll expenses 10 000� Selling costs 2 500� Jet fuel 5 500� Government user fees 8 000� Catering costs 1 000� Ground handling 12 000� Technical maintenance 12 000� Aircraft depreciation 5 000� Overhead costs 6 000� Other 3 000� Total expenses (EBIT-level) 65 000


� Aircraft with capacity to take 150 pax� Cabin factor 70% = 105 passengers

� 65 000/105 passengers = 760

� SEK 620 per passenger to break even!!

� Reasonable profitability level 10%

� Average price = SEK 680

Business areas

Scandinavian Airlines68

Scandinavian AirlinesQuarterly EBITDAR development

EBITDAR, Scandinavian AirlinesMSEK

-500

0

500

1 000

1 500

2 000

Q1 Q2 Q3 Q4*

2002 2003 2004

Group | Mainline Airline Operations | Subsidiary & Affiliated Airlines | Airline Support Business | Airline Related Business |Hotels69

Severe Revenue Pressure partly offset by larger volumes

�Revenues 12 035 MSEK - 11,6%

• Volume +8,6% • Yields -16,0%• Currency -3,1%

January-June 2004


70

Scandinavian Airlines keyairline profitability drivers

2004 vs 2003

� Traffic (RPK) up 12,5%� Cabin Factor up 3,0 p.u.� Yields (currency adjusted) down 16,3%� Operational unit costs down 12,3%


April-June

71

Operating revenue 7 839 8 513 -7,9%Personnel expenses -1 787 -2 063 -13,4%Sales & distribution -196 -244 -19,7%Fuel -919 -715 28,5%Government user fees -863 -814 6,0%Catering -252 -308 -18,2%Handling costs -1 259 -1 190 5,8%Technical aircraft maintenance -1 007 -1 146 -12,1%Data & telecommunication costs -380 -486 -21,8%Other costs -679 -814 -16,6%Operating expenses -7 342 -7 780 -5,6%

EBITDAR 497 733

EBIT -78 158

EBT -238 -30

April – June 2004 2003

Operating expenses continue to decrease


72

Yield pressure for June and outlook July significantly less

Total yield change vs last year

-25%

-20%

-15%

-10%

-5%

0%

Jan Mar May jul Sep Nov Jan Mar May


2003 2004

73

Scandinavian Airlines aircraft utilization up 13,7% in 1st half

74

Productivity development

Aircraft utilization (12 month roling)

5

5,5

6

6,5

7

7,5

8

8,5

Dec Jan Feb Mar Apr May Jun

Cabin, pilot utilization (12 month roling)

420440460480500520

540560

Dec Jan Feb Mar Apr May Jun

Cabin crew Pilots


75

Productivity targets, Scandinavian Airlines

1H 2004 Target

� Aircraft, block hours/day 8,3 9

� Pilots, block hours/year 540 700-750

� Cabin, block hours/year 560 700-750

� Aircraft’s turnaround 30 to 40


Will contributesignificantly to

Turnaround 2005

76

Personnel reductions in all employee groups

Administration Pilots Cabin crew

Full time equivalent

0

500

1 000

1 500

2 000

2 500

3 000

3 500

4 000

4 500

jan-0

2mar

-02

jun-0

2

sep-

02

dec-0

2mar

-03

jun-0

3

sep-

03

dec-0

3mar

-04

jun-0

4

1953 FTE

3545 FTE

3883 FTE

955 FTE

Status June 2004

Administration & Sales -23%

Cabin Crew* -15%

Pilots -26%

SAS Commuter -14%

* In addition 350 FTE have been layed off and will leave after the summer 2004

3 004 FTE

3 006 FTE

1 441 FTE

825 FTE

Group | Scandinavian Airlines Operations | Subsidiary & Affiliated Airlines | Airline Support | Airline Related Business |Hotels77

� Focus on medium and small companies– To create a win win situation– Reducing costs for both parties

� More than 300 agreements signed so far� New charter agreements

– Agreement with Kuoni group, Star Tours� Project is ongoing throughout 2004

Many new corporate agreements signed in 1 Half


78

7 000

8 000

9 000

10 000

11 000

JAN

-02

MA

R

MA

J

JUL

SEP

NO

V

JAN

-03

MA

R

MA

J

JUL

SEP

NO

V

JAN

-04

MA

R

MA

J

Actual Forecast

Scandinavian AirlinesDevelopment of number of employees


79

-40

-20

0

20

40

60

80

1 7 13 19 25 31 37 43 49 3 9 15 21 27 33 39 45 2 8 14 20 26

� General improved load factors� Significantly higher load

factor than AEA

� Oslo-New York ceased in March 2003

� Traffic in Jan-Jun 2004:– European airlines (AEA)

traffic up 11,2%– SAS traffic up 9,9%

� General improved load factors� Significantly higher load

factor than AEA

� Oslo-New York ceased in March 2003

� Traffic in Jan-Jun 2004:– European airlines (AEA)

traffic up 11,2%– SAS traffic up 9,9%

65707580859095

Janu

aryMarc

hMay Ju

lySep

tembe

rNov

embe

rJa

nuary

March

May July

Septem

ber

Novem

ber

Janu

aryMarc

hMay

SAS AEA

Strong development on North Atlantic

%, RPK vs. Last year

%, Cabin factorWeek


80

-60-40-20

020406080

100120

1 8 15 22 29 36 43 50 5 12 19 26 33 40 47 5 12 19 26

� Positive mix but capacity to many of SAS destinations has increased more than the demand

� Reduced capacity on Bangkok/Singapore

� Shanghai 3/week as from March 28th – Operate 6/week as from

November� Traffic in Jan-Jun 2004:

– AEA traffic up 24,3%– SAS traffic down 16,5%

� Positive mix but capacity to many of SAS destinations has increased more than the demand

� Reduced capacity on Bangkok/Singapore

� Shanghai 3/week as from March 28th – Operate 6/week as from

November� Traffic in Jan-Jun 2004:

– AEA traffic up 24,3%– SAS traffic down 16,5%50

556065707580859095

Janu

aryMarc

hMay Ju

lySe

ptembe

rNov

embe

rJa

nuary

March

May July

Septe

mber

Novem

ber

Janu

aryMarc

hMay

SAS AEA

Asian traffic improved but capacity in the market has increased significantly


%, Cabin factorWeek


81

-20

-10

0

10

20

30

1 9 17 25 33 41 49 5 13 21 29 37 45 4 12 20

� Weak market� Cabin factor in line with AEA

� Traffic Jan-Jun 2004:– AEA traffic up 8,8%– SAS traffic up 7,6%

� Weak market� Cabin factor in line with AEA

� Traffic Jan-Jun 2004:– AEA traffic up 8,8%– SAS traffic up 7,6%

Increasing traffic on European routes

4550556065707580

Janu

aryMar

ch May July

Septem

ber

Novem

ber

Janu

aryMar

ch May July

Septem

ber

Novem

ber

Janu

aryMar

ch May

SAS AEA


%, Cabin factor


82

Market shares on Norway domestic routes

0%

5%10%

15%20%

25%

30%35%

40%45%

50%

Jul Aug Sep Okt Nov Des Jan Feb Mar Apr Mai Juni

Braathens Scandinavian Airlines

Widerøe Norwegian


83

ECA – European cooperation agreement positive for first time in Q2

� Tri-party Joint Venture agreement with BMI, Lufthansa and SAS signed November 9, 1999

� In effect from January 1, 2000� Main scope: To integrate the parties scheduled pass. transport to/

from London/ Manchester� Negative result effect 2002: MSEK 418 (335)� Negative result effect 2003: MSEK 244

� Negative result effect first quarter 2004: MSEK 71� Positive effect second quarter 2004: MSEK 45


Subsidiary & Affiliated Airlines

85

Income for Subsidiary & Affiliated Airlines improved


MSEK, January-June 2004 2003 Change

� Revenues 8 429 8 451 -0,3%� Operating expansives -7 327 -7 584 -3,4%� EBITDAR 1 102 867 +27,1%

� Lease -866 -886 -2,3%� EBITDA 236 -19 n.m.

� Depreciation -287 -275 4,4%� Income from sales/affiliated 112 64 75%� EBIT 61 -230 n.m.

� EBT bef. cap gains -48 -328 85%� EBT incl. gains 12 -350 n.m.

86

Revenues 3 462 2,7% 3 104 -5,5% 1 230 -4,5% 613 26%

EBITDAR 363 12% 614 63% 173 3% 14 -77%

EBT -221 22% 241 n.m 51 n.m -66 n.m

Jan-Jun in MSEK

Improved result in Subsidiary Airlines


87

Spanair hit by MSEK 114 higher jet fuel costs in 1st Half


MSEK 2004 2003 2004 2003

� Revenues 2 057 1 997 3 462 3 372� Operating expenses -1 710 -1 615 -3 099 -3 048� EBITDAR 347 382 363 324

� EBITDA 60 90 -184 -238� EBIT 84 101 -187 -242

� EBT bef. cap gains 18 51 -274 -321� EBT incl. gains 71 86 -221 -283


88

Spanair value creation going forward

� Solid profitability and cash flow is viable as a concequence of excellent cost and efficincy and a business model providing sustainable growth

� Strong position in Madrid and Barcelona, two of Europe’s strongest markets

� The underdog position provides a long lasting growth perspectiv without getting close to dominant position

� The twin track strategy with full service and low cost model is essential in order to capitalize on Spanair’s position

Combining excellent cost and quality/service performance with aninnovative and agressiev commercial model, whould provide very good results and value for the SAS Group over the coming years


89


MSEK 2004 2003 2004 2003

� Revenues 1 685 1 736 3 104 3 285� Operating expenses -1 296 -1 462 -2 490 -2 907� EBITDAR 389 274 614 378

� EBITDA 240 121 318 64� EBIT 204 83 246 -4

� EBT bef. cap gains 201 111 242 9 � EBT incl. gains 200 73 241 -19

Braathens has significantly improved its result


90

Braathens’ result is very impressive compared with European Airlines

� EBT improved MSEK 260 to MSEK 241 in first half

– Yield down 11,9% - partly explained by average longer routes

– Unit cost improved with 14,1%

� Cabin factor increased by 3,3 p.p.

� Costs to be reduced by MSEK 1 000 with full effect in 2006

� To achieve a unit cost of 0,60 NOK (reduction by 20%)

� Strengthen competitiveness in relation to low-cost competitors

� Will enable Braathens to compete at same price levels but still offering network product advantages

� SAS Braathens launched in May


91

Continued positive development in Widerøe


MSEK 2004 2003 2004 2003

� Revenues 642 647 1 230 1 288� Operating expenses -541 -535 -1 057 -1 120� EBITDAR 101 112 173 168

� EBITDA 77 92 127 115� EBIT 42 58 58 45

� EBT bef. cap gains 37 43 51 12 � EBT incl. gains 37 43 51 12


92

Weak yield offset by traffic growth and cost control

� Traffic increased 13,6%

� Yield down by over 10,8%

� Unit cost down 8,4% as Turnaround 2005 has been almost completed

� MSEK 300 in cost improvement measurements under implementation

� New non stop route to Manchester from Bergen as from December


93

Group | Scandinavian Airlines Operation | Subsidiary & Affiliated Airlines | Airline Support | Airline Related Business |Hotels


MSEK 2004 2003 2004 2003

� Revenues 345 262 613 485� Operating expenses -303 -207 -599 -424� EBITDAR 42 55 14 61

� EBITDA 7 21 -55 -6� EBIT 3 19 -61 -11

� EBT bef. cap gains 0 16 -66 -13 � EBT incl. gains 0 16 -66 -13

Blue1 with break even result in second quarter

94

Blue1 traffic increased with 80% in first half 2004


� Successful introduction of new domestic routes in Finland

� Helsinki-Amsterdam over 60% cabin factor in first month of operation

� EBT in second quarter MSEK 0

� Yield down by 28,6%

� Unit cost down 21,2%

� MSEK 150 in cost improvement measurements under implementation

Airline Support Businesses96


�Revenues 6 840 6 980 -2%�Operating expenses -6 429 -6 825

�EBITDA 411 155 165%�EBIT 179 -70 n.m

�EBT 138 -133 n.m

Result for Airline Support Businesses improved


Airline Related Businesses98


�Revenues 1 439 2 383 -40%�Operating expenses -1 331 -2 253 -41%

�EBITDA 108 130 -17%

�EBIT 29 -1 n.m

�EBT 22 18 +22%

Statement of income Airline Related Businesses


� Scandinavian IT Group sold in December 2003 and included in the 2003 figures

99

Avinor has discontinued negotiations with SAS Trading tax free operations in Norway


� A definite agreement is expected in August 2004� SAS Trading’s current agreement will expire in December 2004

– New agreement valid for seven years starting in 2005– The agreement is expected to have a turnover of SEK 1 billion

� Current agreements stands for appr. 2/3 of SAS Trading’s total revenue

� SAS Trading has in total 38 duty free shops in Scandinavia, Poland and the Baltic states of which 6 in Norway

100 101



MSEK 2004 2003 2004 2003

� Revenues 1 121 903 2 039 1 745� Operating expensives -1 084 -904 -2 059 -1 821� EBITDA 37 -1 -20 -76

� Adjusted EBITDA 45 4 -5 -72

� EBIT 6 -28 -82 -135

� EBT 7 -39 -93 -154

Hotels – second quarter result improved by MSEK 46

102

Occupancy factor, including managed hotels

Vs. Last year

-15%

-10%

-5%

0%

5%

10%

Jan0

3

Feb

Mar Apr

MajJu

n Jul

Aug

Sep

OctNov Dec

Janu

ary 2

004 Feb

Mar Apr

May Jun

Improved occupancy factor


103

Unit cost continues to improve


65

70

75

80

85

90

jan-01

mar-01

maj-01

jul-01

sep-0

1no

v-01

jan-02

mar-02

maj-02

jul-02

sep-0

2no

v-02

jan-03

mar-03

maj-03

jul-03

sep-0

3no

v-03

jan-04

mar-04

maj-04

Unit cost - 12 month rolling

�Unit cost calculated as Costs/number of rooms

104

RevPAR has stabilized

45

50

55

60

65

70

75

80

jan-01

feb-01

mar-01

apr-0

1maj-

01jun

-01jul-01

aug-0

1se

p-01

okt-0

1no

v-01

dec-0

1jan

-02feb

-02mar-

02ap

r-02

maj-02

jun-02jul-02

aug-0

2se

p-02

okt-0

2no

v-02

dec-0

2jan

-03feb

-03mar-

03ap

r-03

maj-03

jun-03jul-03

aug-0

3se

p-03

okt-0

3no

v-03

dec-0

3jan

-04feb

-04mar-

04ap

r-04

maj-04

jun-04

Rev

PAR

RevPAR 12 month rolling


105

Financial update


106

Balance Sheet

MSEK 30 JUN 04 31 MAR 04 31 DEC 03

Liquid funds 8 829 8 385 9 066Aircraft 22 572 24 582 25 561Other assets 29 103 29 450 26 648Total assets 60 504 62 417 61 275

Operating liabilities 17 231 16 933 15 890Interest-bearing liabilities 28 437 30 483 28 866Deferred tax 2 947 3 136 3 273Minority interests 22 16 112Equity 11 867 11 849 13 134Total liabilities and equity 60 504 62 417 61 275

Financial net debt 18 352 20 277 18 122


107

SAS Group’s limited aircraft Capex


Firm Aircraft Orders Total 2004 2005 2006 2007

Airbus A320/321 4 2 2Boeing 737 3 1 2

Number of aircraft 7 1 2 4

CAPEX (MUSD) 256 23 9 93 131

108

SAS Group’s Capex Holiday

0

2000

4000

6000

8000

10000

12000

14000

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

F20

05F

2006

F20

07F

MS

EK


Jul-d

ec

109

Clear Targets to Reduce Indebtedness- Long-term targets to be realised

Key figures Jun04 Dec03 Target� Equity/assets ratio (solidity) 20% 22% >30%� Financial net debt/ equity 154% 137% <50%� Fin. net debt+7*Oplease/ equity 313% 292% <100%

� Targets will be reached by: – Turnaround measures– Capital Release:

• Aircraft – Surplus and phase-outs• Other Assets (Properties, non-core subsidiaries etc)


110

2 500 2 5002 800

6 600

9001 100 1 200

2 000

1 200

4 800

- 500

1 000 1 500 2 000 2 500 3 000 3 500 4 000 4 500 5 000 5 500 6 000 6 500 7 000

2004 2005 2006 2007 2008 2009 2010 2011 2012 >2013

MSE

K

Amortization profile interest bearing liabilities


Jul-dec

111

Development of financial net debt 1993-2004

0

5 000

10 000

15 000

20 000

25 000

92-12 93-12 94-12 95-12 96-12 97-12 98-12 99-12 00-12 01-12 02-12 03-12

MSE

K

Average 93MSEK 15.900

Average 94 MSEK 9.700










Average Q2 04MSEK 19.100


112

SAS Group - Development and Break Down of Financial Net Debt 2004

(MSEK) 040630 031231 Difference

Cash 8 829 9 066 -237

Other interest bearingassets 1 256 1 678 -422

Interest bearingliabilities -28 437 -28 866 +429

Financial Net debt -18 352 -18 122 -230


113

SAS Group - Development and Break Down of Financial Net Debt 2003-2004

(MSEK) 040630 030630 Difference

Cash 8 829 8 155 +674

Other interest bearingassets 1 256 1 954 -698

Interest bearingliabilities -28 437 -29 341 +904

Financial Net debt -18 352 -19 232 +880


114

Financial Net Debt / Equity Ratio 1992-2004

0,0

0,3

0,5

0,8

1,0

1,3

1,5

1,8

2,0

2,3

2,5

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003


115

SAS Group Equity / Assets Ratio 1992-2004

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003


116

Adjusted Net Debt / Equity1992-2004

Net Debt+7*Op lease / Equity

0%

50%

100%

150%

200%

250%

300%

350%

400%

1992

1993

199419

9519

96199

7199

8199920

0020

01200

2Q1-2

003Q1-2004


117

SAS Group’s Balance Sheet largely Unencumbered

As per 30 June 04MSEK

SAS Group’s total Balance Sheet 60 504

Total aircraft and spares 22 572

Encumbered Assets:Aircraft (book values) 14 300Other 200

Total 14 500


63% of aircraft and spare parts encumbered

118

SAS GroupFinancial Net January – June 2004

(MSEK) 04-06-30 03-06-30 Difference

Interest net and others -461 -476 +15Exchange rate differences -29 +332 -361Financial net -490 -144 -346

Average financial net debt 19.100 19.600 +500

In % p.a. of average financial net debt:Interest net -4,8% -4,9% +0,1 p.u.Exchange rate differences -0,3% +3,4% -3,7 p.u.Financial net -5,1% -1,5% -3,6 p.u.


119

Gearing ratios

Leverage Ratios

-10%

40%

90%

140%

190%

240%

290%

340%

dec-98 dec-99 dec-00 dec-01 Dec-02 mar-03 jun-03 sep-03 03-dec 04-mar 04-jun

Net Debt / Equity Fin Net Debt / Equity Fin. Net Debt + 7*Op lease / Equity


120

Improved cash flow as underlying result is improving

April – JuneMSEK, 2004 2003

Cash flow from operations 563 550Change in working capital -47 229Net financing from operations 516 779

Investments, advance payments -1 063 -1 260Acquisition/sale of subsidiaries (net) 0 0Sales of fixed assets, etc. 2 544 1 604Financing deficit/surplus 1 997 1 123

Changes in external financing, net -1 533 -1 502Changes in liquid assets acc. to balance sheet 444 -379


121

Improved cash flow but no change in liquid assets as surplus is amortized

January – JuneMSEK, 2004 2003

Cash flow from operations -332 -545Change in working capital -557 -359Net financing from operations -889 -904

Investments, advance payments -1 721 -2 224Acquisition/sale of subsidiaries (net) -614 -15Sales of fixed assets, etc. 3 910 1 906Financing deficit/surplus 686 -1 237

Changes in external financing, net -923 -1 329Changes in liquid assets acc. to balance sheet -237 -2 566


122

Sum Up – Credit Data

�Strong liquidity of MSEK 8 829

�Substantial Committed credit facilities of MSEK 4 550

�Limited CAPEX going forward

�Young aircraft fleet

�Additional sources of capital

�Turnaround 2005 program on track with union agreements secured


123

APPENDICES

Traffic DataYieldUnit costFleet Financial key figures

124

Increased traffic in the first Half

�Group passenger load factor up by 1,7 p.u.

�Group traffic up 11,1%

Passenger- Seat capacity Cabin-January-June traffic (RPK) (ASK) factorSAS Group Total 11,1% 8,1% 63,2%Intercontinental 12,8% 0,1%Europe 15,6% 17,5%Domestic and 1,4% 0,1%Intrascandinavian


125

�Scandinavian Airlines 5%�Spanair 10%�Braathens 4-5%�Widerøe 12-13%�Blue1 60%�Total SAS Group 7%

Capacity (ASK) outlook 2004 vs. 2003


126

Yield development 2004 vs 2003

Scandinavian AirlineTotal Scheduled

Apr-Jun 2004 2003 Change

Yield (öre/RPK) 103,1 125,2 -17,7%Currency adj. yield 103,1 123,2 -16,3%

Jan-Jun 2004 2003 Change

Yield (öre/RPK) 105,4 129,5 -18,6%Currency adj. yield 105,4 125,5 -16,0%


127

Yield development 2004 vs 2003

April-Jun January-June

-12,5% -11,0%

-9,4% -11,9%

-13,0% -10,8%

-27,4% -28,6%

Yield, local currency


128

Unit Cost January-June 2004 vs 2003

Volume = average increase in ASK: +4,9%

Share of Cost analysis 2003 2004 Var% total var %Personnel -4 318 -3 590 -16,9% -4,5%Fuel -1 418 -1 666 17,5% 1,5%Gov. Charges -1 638 -1 638 0,0% 0,0%Selling cost -494 -382 -22,6% -0,7%Ground Services -2 589 -2 477 -4,3% -0,7%Technical -2 263 -1 880 -16,9% -2,4%Other operating costs -2 326 -1 365 -41,3% -6,0%Total operating expenses -15 045 -12 998 -13,6% -12,7%Aircraft costs -1 043 -876 -16,0% -1,0%Adjusted EBIT -16 088 -13 874 -13,8% -13,8%


129

Unit Cost April-June 2004 vs 2003

Volume = average increase in ASK: +7,6%

Share of Cost analysis Q2 2003 Q2 2004 Var% total var %Personnel -2 186 -1 787 -18,3% -4,9%Fuel -728 -919 26,3% 2,4%Gov. Charges -861 -863 0,2% 0,0%Selling cost -262 -196 -25,1% -0,8%Ground Services -1 289 -1 259 -2,3% -0,4%Technical -1 132 -1 007 -11,1% -1,5%Other operating costs -1 134 -624 -45,0% -6,3%Total operating expenses -7 592 -6 655 -12,3% -11,5%Aircraft costs -534 -430 -19,5% -1,3%Adjusted EBIT -8 126 -7 085 -12,8% -12,8%


130

Sharp reduction in unit cost continued in Q2

� Unit cost down 11,8% in 2003

� Unit cost down 14,7% in Q1 2004

� Unit cost down 12,3% in Q2 2004

� Adjusted for fuel price unit cost down 14,7% in Q2 2004

-20%

-15%

-10%

-5%

0%

5%

10%

1st Q2001

3rd Q2001

1st Q2002

3rd Q2002

1st Q2003

3rd Q2003

1st Q2004

Index last year, EBITDAR level(currency adjusted) Scandinavian Airlines


131

Yield Development

April-June (currency adjusted)

-20,0%

-18,0%

-16,0%

-14,0%

-12,0%

-10,0%

-8,0%

-6,0%

-4,0%

-2,0%

0,0%

2003 2004-20,0%-18,0%

-16,0%-14,0%

-12,0%-10,0%

-8,0%-6,0%

-4,0%-2,0%

0,0%

2003 2004

January-June (currency adjusted)


132

Yield development

-18

-16

-14

-12

-10

-8

-6

-4

-2

0

2

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

2002 vs 2001 2003 vs 2002 2004 vs 2003

� Yields down 16,3% in 2nd Quarter 2004– Affected by:– Affected 5-6 pp by

higher proportion intercont. traffic

– Class mix negative– Price campaigns

%


133

Passenger Yield2nd Quarter 2004 vs 2003

Nominal Currency AdjustedRoute Sector yield effect yield

Scandinavian Airline 82 102 84

Intercontinental 96 103 99Europe 86 101 86Intrascandinavian 72 102 74Denmark 89 100 89Norway 78 105 82Sweden 81 100 81


134

Passenger YieldJanuary-June

Nominal Currency AdjustedRoute Sector yield effect yield

Scandinavian Airline 81 103 84

Intercontinental 95 105 99Europe 84 102 85Intrascandinavian 71 104 73Denmark 88 101 89Norway 78 110 85Sweden 83 100 83


135

Key airline profitability drivers2004 vs 2003

January-June� Traffic growth (RPK) up 8,6%� Cabin Factor up 2,2 p.u.� Yields down 16,0%� Unit costs incl A/C cost down 13,8%

April-June� Traffic growth (RPK) up 12,5%� Cabin Factor up 3,0 p.u.� Yields down 16,3%� Unit costs incl A/C cost down 12,8%


136

Severe Revenue Pressure partly offset by larger volumes

�Revenues 12 035 MSEK - 11,6%

• Volume +8,6% • Yields -16,0%• Currency -3,1%

January-June 2004


137

Revenue analysis second Quarter –Scandinavian Airlines

April-June 2004

� Revenues 6 513 MSEK - 7,4%

– Volume +12,5% – Yields -16,3%– Currency -1,6%


138

Passenger load factor 1995-2004Moving 12 months values

63%

64%

65%

66%

67%

68%

69%

DEC94 DEC95 DEC96 DEC97 DEC98 DEC99 DEC00 DEC01 DEC02 DEC03


139

Weaker USD offset by increased yield pressure

6

7

8

9

10

11

12

2003

2002

2001

2000

2004


� Positive effect on operation costs in January-June by xxx MSEK

� Weak USD => increased yield pressure

140

Currency Effects – SAS GroupJanuary-June 2004 vs 2003

MSEK Jan-JunTotal revenues -1 116Total costs +1 478Forward cover costs & working cap. -117Income before depr. +245

Financial items -361Income before tax -116


141

Currency Effects – SAS GroupApril-June 2004 vs 2003

MSEK Apr-JunTotal revenues -316Total costs +433Forward cover costs & working cap. -102Income before depr. +15

Financial items -21Income before tax -6


142

Currency Effects – SAS GroupJanuary-June 2004 vs 2003

Total revenues & costs:(Total +362 MSEK)Major approx. effects:USD +530DKK +6NOK -131EUR -1Asian curr. -35All others -7

Forward cover costs:(Total -140 MSEK)2003 +982004 -42

Working capital:(Total +23 MSEK)2003 -252004 -2

Financial items:(Total -361 MSEK)2003 +3322004 -29

Grand total -116 MSEK


143

Currency Effects – SAS GroupApril-June 2004 vs 2003

Total revenues & costs:(Total +117 MSEK)Major approx. effects:USD +165DKK +2NOK -55EUR -1Asian curr. -7All others +13

Forward cover costs:(Total -78 MSEK)2003 +552004 -23

Working capital:(Total -24 MSEK)2003 +192004 -5

Financial items:(Total -21 MSEK)2003 +292004 +8

Grand total -6 MSEK


144

Expenses

DKK15%

EUR15%

GBP2%

NOK25%

SEK17%

USD25%

Others1%

Revenues

DKK9%

EUR22%GBP

4%

NOK33%

SEK19%

USD8%

Others5%

Currency distribution in the SAS Group 2003


145

SAS Group fleet as of Jun 30, 2004

Company Owned Leased Total Leased On OrderIn Out

Scandinavian Airlines 88 88 176 13 7Spanair 54 54Braathens 4 23 27 1Wideroe 16 13 29Blue1 14 14

Total 108 192 300 14 7

Aircraft Type Owned Leased In TotalLeased

Out On OrderAirbus A330/340-300 7 4 11Airbus A320/A321-200 8 19 27 4Boeing 767 3 3 3Boeing 737 29 50 79 5 3Boeing 717 4 4Douglas MD-81/82/83/87 31 61 92 4Douglas MD-90 8 8Avro RJ-85/100 9 9Fokker F28 1 1Fokker F50 7 1 8 2deHavilland Q100-400 17 36 53SAAB 2000 5 5Total 108 192 300 14 7


146

SAS share

147

Development of Market capitalization

02 0004 0006 0008 000

10 00012 00014 00016 00018 00020 000

feb-99jun-99okt-99feb-00jun-00okt-00feb-01jun-01okt-01feb-02jun-02okt-02feb-03jun-03okt-03feb-04jun-04


148

* Peers: Alitalia, Air France, British Airways, Finnair, KLM, Lufthansa &Ryanair

SAS share price vs. Peers 2002-2003

72,6

84,9

4050

6070

8090

100110

120130

31

-dec

-01

31

-jan

-02

28

-feb

-02

31

-mar

-02

30

-apr

-02

31

-maj

-02

30

-ju

n-0

2

31

-ju

l-0

2

31

-au

g-0

2

30

-sep

-02

31

-okt

-02

30

-nov

-02

31

-dec

-02

31

-jan

-03

28

-feb

-03

31

-mar

-03

30

-apr

-03

31

-maj

-03

30

-ju

n-0

3

31

-ju

l-0

3

31

-au

g-0

3

30

-sep

-03

31

-okt

-03

30

-nov

-03

31

-dec

-03

31

-jan

-04

29

-feb

-04

31

-mar

-04

30

-apr

-04

31

-maj

-04

30

-ju

n-0

4

Index Peers Index SAS

SAS Market Capitalization vs. European Peers* measured in SEK(December 28, 2001 - June 30, 2004)


149

Number of shares traded in SAS per month

0

2 000 000

4 000 000

6 000 000

8 000 000

10 000 000

12 000 000

14 000 000

Janu

aryFe

brua

ryMarc

hAp

rilMayJu

ne

July

Augu

stSep

tembe

rOcto

ber

Novem

ber

Decem

ber

Janu

aryFe

brua

ryMarc

hApr

ilMayJu

ne

Increased trade in the share…

2004 vs 20032003 vs 2002


150

…and at Stockholm Stock Exchange

Average dai ly number of shares traded in Stockholm per month

0

50 000

100 000

150 000

200 000

250 000

300 000

Janu

aryFe

brua

ryMarc

hAp

rilMayJu

ne July

Augu

stSe

ptem

ber

Octobe

rNov

embe

rDec

embe

rJa

nuary

Febr

uary

March

April

MayJu

ne

2004 vs 20032003 vs 2002


Second Quarter 2004 - SAS – Welcome to SAS … in May 2004 –Boeing 737 fleet only lounge access...

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Transcript of Second Quarter 2004 - SAS – Welcome to SAS … in May 2004 –Boeing 737 fleet only lounge access...