Financial Report 1 January – 31 December 2009

Finnair Group

Sector difficulties continueThe overcapacity is still growingAircraft are underutilisedPassenger demand is showing first signs of growthPrice pressure remains highCargo demand improving, price level rising slightlyOil price has risen 30% since last summerAnnus Horribilis – IATA estimates 11 billion dollar loss for last yearDecennis Horribilis – sector losses totalled 50 billion dollars in 2000–2009 Loss forecast for current year 5.6 billion dollars

Finnair’s profitability declined

Sector troubles also burden FinnairTurnover fell last year by 20%Operational loss 180 million eurosTicket prices down by 12%, in the latter part of the year 10%, cargo prices -30% and last quarter -27%Passenger load factor remained goodCapacity adjusted to volume decline; cost level still too high compared with price levelEfficiency programme improved result by 100 million eurosPilot strike and walkout by baggage handling workers is estimated to cause company >20 million euros in lossesFinnair still has strong balance sheet and cash positionPunctuality and customer satisfaction improved despite difficulties at end of year

Very poor operational result for 20092009 2008 Change %

Turnover mill. euro 1,838 2,256 -18.5

Operational expenses mill. euro 2,038 2,278 -10.5

Adjusted EBITDAR* mill. euro 11.9 173.5 -

Adjusted EBIT* i.e. Operational result mill. euro -180.2 0.8 -

One off items/ capital gains mill. euro 0.7 -1.3 -

Fair value changes of derivatives mill. euro 55.5 -57.4 -

Operating profit/loss (EBIT) mill. euro -124.0 -57.9 -

Profit before tax mill. euro -133.7 -62.2 -

*excl. capital gains. fair values changes of derivatives and non recurring items

Loss diminished towards the end of the yearMEUR EBIT* per quarter

*excl. capital gains. fair value changes of derivatives and non recurring items

-80

-60

-40

-20

0

20

40

60

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

MEUR

2006 2007 20082005 2009

-15

-10

-5

0

5

10

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Unit costs develop in the right direction

% Yield (EUR/RTK) Unit costs (EUR/RTK)

2006 2007 20082005 2009

Change YoY

Savings materialise2009 Q4/09

Unit costs of flight operations* c/RTK -2.4% -7.0%

Unit costs of flight operations* excl. fuel c/RTK 0.8% -2.2%

Personnel expenses c/RTK -4.3% -15.4%

Fuel costs c/RTK -10.6% -19.7%

Traffic charges c/RTK +0.5% -8.2%

Ground handling and catering €/psgr. -1.7% -4.9%

Sales and marketing €/psgr. -13.7% -1.1%

Aircraft lease payments and depreciation c/RTK +15.0% +18.3%

Other costs* c/RTK +4.5% +3.3%

* excluding fair value changes of derivatives and non-recurring itemsRTK = Revenue Tonne Kilometre

200 million euro efficiency program

Savings target in personnel costs totalling 120 million eurosTargets of close to 150 mill. euro identified or agreed upon• Fuel efficiency• Structural and operational changes• Temporary lay-offs continue• Number of staff decreased by 1650• Stabilisation agreements in Technical Services, Catering and

cabin service• Reduction of unit costs agreed upon in pilots’ collective agreement

100 mill. euro impact on profitability already in 2009Structural impact of the program per annum 110 mill. euro

Headcount 1650 less than year before

0

2000

4000

6000

8000

10000

12000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Personnel on averagePersonnel

Fuel price on rise

Hedges smoothened fluctuation in 2009

24

133

558

450

-202

-63

0

200

400

600

2008 Volume Price Currency Hedging 2009

MEUR

Hedging losses decreased in Q4

19

101

142

-13

-24

-24

0

50

100

150

2008Q4 Volume Price Currency Hedging 2009Q4

MEUR

Finnair has a rolling hedging policy

0%

20%

40%

60%

80%

100%

2009

Q4

2010

Q1

2010

Q2

2010

Q3

2010

Q4

2011

Q1

2011

Q2

2011

Q3

2011

Q4

2012

Q1

2012

Q2

2012

Q3

2012

Q4

hedge ratio

upper

low er

One of the most modern fleets in the world

Average age of Finnair's entire fleet is around six yearsModern fleet consumes less fuel and produces less emissionsLast Boeing MD-11 aircraft will be withdrawn from Finnair traffic on 22 February 2010Having fewer aircraft types brings commonality benefitsThree of seven Boeing 757 aircraft will be withdrawn this springTwo Embraer 170 planes leased, two for saleIn the early 2010, two new Airbus A330 aircraft, one more in late 2010

Funding securedFunding of Finnair investment programme ensuredInvestment schedule relaxedCash reserves more than 600 mill. euros• Sale and lease-back of properties and a spare engine, 90 mill. euros • European Investment Bank, 180 mill. euros• Export Credit Agencies, 1 A330 plane on financial leasing• An emitted hybrid bond of 120 mill. euros lowers gearing

Funding sources totalling 600 mill. euros• Export Credit Agencies, 2 A330 planes on financial leasing • Loan-back of TyEL pension fund reserves, 330 mill. euros remaining • Liquidity reserve unused credit facility, 200 mill. euros

In addition, 200 million euro commercial paper programme, of which 120 in use

Strengtened cash in Q4 Cash flow statement

Q4/2009 Q1-Q4/2009 Q1-Q4/2008

Cash flow from operations mill. euro -7 -121 +120

Investments and sale of assets mill. euro +10 -265 -186

Investments mill. euro -9 -348 -233Change of advances and others mill. euro +19 +83 +47

Cash flow from financing mill. euro +300 +601 -82

Liquid funds at the beginning mill. euro 304 392 540

Change in liquid funds mill. euro +303 +215 -148

Liquid funds* at the end mill. euro 607 607 392

*incl. financial interest bearing assets at fair value

Balance sheet made strongerEquity ratio and adjusted gearing

0

20

40

60

80

100

120

2004 2005 2006 2007 2008 2009

Equity ratio Adjusted Gearing%

Emissions trading raises questions

EU begins air transport emissions trading unilaterally in 2012Free emissions rights to be received by each airline for 2012-2020 will be based on this year’s revenue tonne kilometresRisk of changing ground rules existsFinnair has supplied the necessary documentation to TraFiCurrent emissions trading model will increase carbon leakage risk and jeopardise EU competitivenessFinnair supports sector-specific emissions trading which is global and does not distort competition

Industrial action and weather disrupted traffic at turn of the year

In December, illegal walkout by loading workers• Over 80% of baggage handled normally• flights delayed and some cancelled• further disruptions after walkout• nearly 7 million euros in losses

In January, Central European weather disrupted air traffic• turn of the year challenging due to large passenger numbers,

terminal change and problematic weather• baggage congested at all European airports

Finnair still on top in punctuality

Challenging start for the year

Slow pick-up in passenger and cargo demandBusiness travel demand growing outside Finland, but at lower price levelsPassenger traffic capacity in early 2010 will be 10% less than in 2009First quarter clearly loss-making Three new Airbus A330 long-haul aircraftFunding for investments arrangedEfficiency programme and structural change to be continuedProfitability expected to improve towards end of the year

Finnair's strategy working

Asia-Europe strategy based on Via Helsinki concept is working; geographical advantage a lasting competitive advantageGrowing affluence in Asia presents huge growth potentialPassenger numbers have grown from 0.3 million in 2001, to over 1.1 million in 2009 Finnair's Asian traffic accounted for 3.7% of Finland's GDP growth in 2002–2007Created more than 4,000 jobs in Finnair alone8,000 new jobs by 2015 Without Asian strategy, company would be only half of present sizeModern fleetIndicators show operational and service quality at a high level

Towards future growthCustomers of the future will increasingly come from AsiaStrategy update and supporting reforms during the spring – main strategy will not changeCompetitiveness based on excellent product and efficient operationsGroup structure focused on core functions in order to achieve flexibility, partners supplement network and service provisionWorking toghether with personnel, to reach joint objectivesSustainable development creates added value for environment-conscious customers

Appendices

Weak operational result for Q4Q4/09 Q4/08 Change %

Turnover mill. euro 457.7 579.0 -20.9

Operational expenses mill. euro 504.1 600.6 -16.1

Adjusted EBITDAR* mill. euro 10.2 22.6 -

Adjusted EBIT* i.e. Operational result mill. euro -39.4 -13.7 -

One off items/ capital gains mill. euro -7.9 -3.8 -

Fair value changes of derivatives mill. euro 4.2 -43.8 -

Operating profit/loss (EBIT) mill. euro -43.1 -61.3 -

Profit before tax mill. euro -45.4 -62.0 -

*excl. capital gains. fair values changes of derivatives and non recurring items

Segment results*

Mill. euro Q4/2009 Q4/2008Airline Business -47.1 -23.0Aviation Services 9.9 5.0Travel Services 1.2 5.3Unallocated items -3.4 -1.0Total -39.4 -13.7

* Operating profit. excluding capital gains, fair value changes of derivatives and non restructuring items

Segment results*

Mill. euro Q1-Q4/2009 Q1-Q4/2008Airline Business -170.5 -19.4Aviation Services 7.3 13.8Travel Services -4.3 12.3Unallocated items -12.7 -5.9Total -180.2 0.8

* Operating profit. excluding capital gains, fair value changes of derivatives and non restructuring items

Negative trend in profitability levelled off thanks to efficiency measures

-80

-60

-40

-20

0

20

40

60

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

MEUR

2005 2006 20072004 2008 2009

Change in EBIT* per quarter

*excl. capital gains, fair value changes of derivatives and non recurring items

ROE and ROCE Rolling 12 months

-15

-10

-5

0

5

10

15

20

Q1 200

4

Q2 200

4

Q3 200

4

Q4 200

4

Q1 200

5

Q2 200

5

Q3 200

5

Q4 200

5

Q1 200

6

Q2 200

6

Q3 200

6

Q4 200

6

Q1 200

7

Q2 200

7

Q3 200

7

Q4 200

7

Q1 200

8

Q2 200

8

Q3 200

8

Q4 200

8

Q1 200

9

Q2 200

9

Q3 200

9

Q4 200

9

% ROE ROCE

-20

-15

-10

-5

0

5

10

15

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Unit costs develop in the right direction

% Yield (EUR/RTK) Unit costs (EUR/ATK)

2006 2007 200820052004 2009

Change YoY

Unit costs by cost components2009 Q4/09

Unit costs of flight operations* c/ATK +0.8% +1.0%

Unit costs of flight operations* excl. fuel c/ATK +4.2% +6.3%

Personnel expenses c/ATK -1.0% -10.0%

Fuel costs** c/ATK -8.0% -13.1%

Traffic charges c/ATK +3.5% -0.6%

Ground handling and catering €/psgr. -1.7% -4.9%

Sales and marketing €/psgr. -13.7% -1.1%

Aircraft lease payments and depreciation c/ATK +18.5% +28.5%

Other costs* c/ATK +9.5% +13.0%

* excluding fair value changes of derivatives and non-recurring itemsATK = Available Tonne Kilometre

Investments and cash flowfrom operations

-200

-100

0

100

200

300

400

2004 2005 2006 2007 2008 2009

Operational net cash flow InvestmentsMEUR

Aircraft operating lease liabilities

0

100

200

300

400

500

600

2004 2005 2006 2007 2008 2009

MEUR Flexibility. costs. risk management

On 31 December all leases were operating leases. If capitalised using the common method of multiplying annual aircraft lease payments byseven, the adjusted gearing on 31 December 2009 would have been86.9%

Finnair Financial Targets”Sustainable value creation”

Operating profit (EBIT)

EBIT margin at least 6% => over 120 mill. € in the coming few years

EBITDAREBITDAR margin at least 17% => over 350 mill. € in the coming few years

Economic profit

Pay out ratio Minimum one third of the EPS

Adjusted Gearing

Gearing adjusted for aircraft lease liabilities not to exceed 140 %

To create positive value over pretax WACC of 8.25%

Finnair’s Financial Targets Description of targets

Operating profit (EBIT)

EBITDAR

Economic profit

Pay out ratio

Adjusted Gearing

Turnover + other operating revenues – operating costs

Result before depreciation. aircraft lease payments and capital gains

Operating profit EBIT – Weighted Average Cost of CapitalInterest bearing debt + 7*Aircraft lease payments

– liquid funds) / (Equity + minority interests)

Dividend per share / Earnings per share

www.finnair.com/groupFinnair Group Investor Relations

email: investor.relations@finnair.com

tel: +358-9-818 4951fax: +358-9-818 4092