EANS-News: Air Berlin PLC /airberlin: Efficiency programme has desired effect

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Financial Figures/Balance Sheet/fy2011 results

Subtitle: • 2011 balance sheet: turnover rose to 4.23 billion Euros,
passenger numbers to 35.3 million • Despite higher fuel costs 1st
quarter will be better than previous year • Mehdorn: bottoming out
process ridden out • oneworld membership and strategic partnership
with Etihad Airways will have a positive outcome

London/Berlin (euro adhoc) - The second largest German airline
airberlin is looking at the future more positively after a poor 2011.
As airberlin CEO Hartmut Mehdorn reported at the company´s press
conference to announce the results for the financial year on Friday
in Berlin: "Despite record figures for turnover and passenger
numbers, we cannot be satisfied with the 2011 results." Not only as a
result of the severe winter in Europe in early 2011, the Arab Spring,
air-traffic control strikes and the threat of strike action, the
results remained well below expectations. In particular the
introduction of air traffic tax (165.6 million Euros) and the rise in
fuel prices (229.2 million Euros) added costs of around 395 million
Euros for the company within 12 months. Mehdorn comments: "I am still
confident that the German government will recognise how damaging the
air traffic tax is to German aviation. It leads to distortion of
competition, is environmentally nonsensical and puts jobs at risk."
The fact that six German airlines have to pay almost 60 percent of
the approximately one billion Euros in taxes, whereas the remaining
40 percent is paid by 100 foreign airline companies, is said to be
absurd.

As Mehdorn says: "airberlin is now able, through major course
corrections and other actions, to detect positive effects, and
therefore to look to the future with optimism." This means that the
efficiency improvement programme "Shape & Size" is likely to show its
effectiveness as early as the first quarter; despite the roughly 35
million Euros of extra costs due to the rise in aviation fuel prices,
a better result will be attained in comparison with the previous
year´s quarter. airberlin´s CFO Ulf Hüttmeyer comments: "Our fitness
programme `Shape & Size´ will reach its full effect and unfold in the
second half. We expect to achieve an operational improved result of
more than 200 million Euros this year alone." Performance in all
areas is visibly improving; we have ridden out the bottoming out
process", emphasised Mehdorn. He also gave a positive assessment of
the strategic partnership with Etihad Airways and membership in the
oneworld® global airline alliance which commenced on 20th March. Both
would offer attractive growth opportunities to the company after
consolidation.

2011 balance sheet

Compared with the previous year, Air Berlin PLC 2011 was able to
increase turnover by 13.7 percent to 4.23 billion Euros (previous
year: 3.72 billion Euros) and the number of passengers by 1.2 percent
to 35.3 million (previous year: 33.6 million). Operational
expenditure at the EBITDAR level has increased by 20.6 percent from
3.16 billion Euros to 3.81 billion Euros. In fact the increase in
expenditure would have been distinctly lower without additional taxes
and one-off effects. Because of this additional expenditure, the
EBITDAR (result before interest, taxes, depreciation and rental
costs) of 618.5 million Euros reduced by 31.1 percent to 425.9
million Euros during the financial year 2011. The EBIT (operating
result before interest and taxes) falls from -9.3 million Euros to
-247.0 million Euros. Contrary to this, the financial result has
improved from -133.3 million Euros to -111.9 million Euros. Lower
financing costs contributed mainly to the lower level of costs. The
pre-tax result in the 2011 financial year is -358.8 million Euros
after -141.6 million Euros in 2010. After a tax credit of 93.2
million Euros, the net result for the reporting year is -265.6
million Euros after -97.2 million Euros in the previous year. Equity
capital is 259.9 million Euros (previous year: 505.3 million Euros)
and net indebtedness is 813.0 million Euros (previous year: 489.3
million Euros).

Shape & Size: airberlin´s fitness programme

With its efficiency improvement programme "Shape & Size", airberlin
intends to make an improvement in the operating result of more than
200 million Euros in 2012 alone. "Shape & Size" is the comprehensive
programme rolled out across the group to improve the efficiency of
all operating processes. This includes, amongst other measures, the
optimisation of network and fleet, processes and allocation of staff,
savings in administration and procurement with the aim of sustainably
reducing overall operating costs while achieving higher revenues,
including the implementation of a state-of-the-art sales platform
through which a better use can be made of available capacity and a
higher average seat occupancy factor can be achieved.

Strategic partnership with Etihad Airways

Due to the strategic partnership with Etihad Airways entered into on
19th December, new markets have opened up to airberlin and its
passengers, providing new growth opportunities in Asia and Australia.
Likewise, passengers travelling with Etihad Airways will benefit from
airberlin´s dense European network and its links to North America.
Both parties are also looking for synergies in their co-operation.
The strategic partnership links the route networks and frequent-flyer
programmes of both airlines with one another and expands the flight
offers for both companies to 239 destinations in 77 countries. Both
route networks are expanded in an ideal way, as they scarcely overlap
and therefore complement one another. The co-operation between Etihad
Airways and airberlin will be comprehensive. Both companies announced
just a few days ago, for instance, that they will be combining their
programme for the procurement, specification and maintenance of the
future Boeing 787 Dreamliner. A series of joint working groups have
also been formed to obtain benefits from this co-operation. The
frequent-flyer programmes of both airlines are co-operating, so that
topbonus members will be able to collect both status and premium
miles on all flights with Etihad Airways.

Membership in oneworld airline alliance

When airberlin will become a member of the global alliance oneworld
on 20th March, this represents a further major strategic step.
Membership in oneworld massively expands the offers for airberlin
passengers: the access opportunities to gateways increase to 75 and
destinations to around 800 in 150 countries. The alliance fleet
comprises around 2,500 aircraft, offers around 9,000 flights per day
and transports 300 million passengers per year. Customers of the
airberlin frequent flyer programme topbonus can collect and redeem
status and premium miles worldwide with 11 oneworld carriers.
Frequent flyers also gain access to more than 550 airport lounges
worldwide. And the airberlin frequent flyer program topbonus is
already co-operating with some frequent flyer programmes operated by
other members of oneworld. topbonus participants can collect and
redeem miles over the whole route network of the oneworld alliance.

Further inquiry note:
Uwe Berlinghoff
Senior Vice President Communications airberlin
phone: +49 30 3434 1500
fax: +49 30 3434 1509
e-mail: abpresse@airberlin.com

end of announcement euro adhoc
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company: Air Berlin PLC
The Hour House, High Street 32
UK-WD3 1ER Rickmansworth, Herts
phone: +49 (0)30 3434 1500
FAX: +49 (0)30/3434-1509
mail: abpresse@airberlin.com
WWW: http://www.airberlin.com
sector: Air Transport
ISIN: GB00B128C026
indexes: SDAX, Classic All Share, Prime All Share
stockmarkets: free trade: Berlin, München, Hamburg, Düsseldorf, Stuttgart,
regulated dealing/prime standard: Frankfurt
language: English