Kingfisher Airlines……….The king of good times

AVIATION INDUSTRYOne of the fastest growing industries in the world.

India has the private airlines as its key players and 75% of the market share is owned by the private sector.

Problems that the Indian aviation industry is facing are:

High rising prices of the ATF. The cost of labour is rising in our country. Shortage of skilled labour. Infrastructure constraints.

Kingfisher Airlines

REGISTERED OFFICE :

UB Tower, Level 12, UB City, 24, Vittal Mallya Road,

Bangalore – 560 001

Kingfisher Airlines BOARD OF DIRECTORS

Dr. Vijay Mallya, Chairman & CEOCapt. G. R. Gopinath, Vice Chairman

Capt. K.J. SamuelMr. A.K. Ravi Nedungadi

Mr. Vijay AmritrajMr. Anil Kumar Ganguly

Mr. Piyush G. Mankad Dr. Naresh TrehanDiwan Arun Nanda

Mr. Ghyanendra Nath Bajpai

Kingfisher Airlines

COMPANY SECRETARYMr. N. Srivatsa

CHIEF FINANCIAL OFFICER Mr. A. Raghunathan

Kingfisher Airlines

Kingfisher Airline is a private airline based in Bangalore, India.

The airline is owned by Vijay Mallya of United Beverages Group.

Kingfisher Airlines started its operations on May 9, 2005 with a fleet of 4 Airbus A320 aircrafts.

The airline currently operates on domestic routes. The destinations covered by Kingfisher Airlines are Bangalore, Mumbai, Delhi, Chennai, Hyderabad, Ahmedabad, etc

In a short span of time Kingfisher Airline has carved a niche for itself.

The airline offers several unique services to its customers.

These include: personal valet at the airport to assist in baggage handling and boarding, accompanied with refreshments and music at the airport, audio and video on-demand, with extra-wide personalized screens in the aircraft and three-course gourmet cuisine.

Kingfisher Airlines

Kingfisher Airlines

Kingfisher Airlines starting operating with a brand new fleet of 8 Airbus A320 aircraft, 3 Airbus A319-100 aircraft and 4 ATR-72 aircraft.

It was the first airline in India to operate with all new aircrafts. Kingfisher Airlines is also the first Indian airline to order the Airbus A380.

UB holdings Ltd, has acquired 46% stake in the budget airline Air Deccan

MARKET SHARECurrent ScenarioCurrent Scenario

Kingfisher Airlines -> 20.8%Kingfisher Airlines -> 20.8%

Jet Airways -> 19 %Jet Airways -> 19 %

Indian + Air India -> 18.3%Indian + Air India -> 18.3%

Indigo -> 15.4 %Indigo -> 15.4 %

Spice Jet -> 12.9%Spice Jet -> 12.9%

Others -> 13.6%Others -> 13.6%

Kingfisher Airlines KFA at a Glance

Total connections to 70 cities including 7 international destinations flying over 350 flights a day.

Over 45 million guests flown since inception

Current Fleet size of 67 aircraft (39 Airbus and 28 ATRs’). Market Share of 20.8%

Recognized as one of India’s Most Respected Companies in 2006 and 2007 –Business World

India’s only 5 star airline –by independent agency Skytrax

Kingfisher Airlines

Domestic operations have achieved an EBITDA profit of Rs 15 Cr in the 9 months ended Dec 09 vs a loss of Rs 1058 cr in the same period last year

Domestic revenue up 17%

Guests flown increased by 5% despite 3% reduction in capacity

Capacity deployed decreased by 1.06 lac seats.Guests flown increased by 1.14 lacs

Highest ever seat factor of 80.2% achieved during December 2009

KFA at a Glance

Kingfisher Airlines

Kingfisher Airlines

Kingfisher Airlines

Kingfisher Airlines

Kingfisher Airlines, India’s only Five Star Airline rated by Skytrax, has been granted traffic rights to operate on seven new international routes.The new international routes for which traffic rights have been granted are:1New Delhi – London – New Delhi2New Delhi – Hong Kong – New Delhi3New Delhi – Bangkok – New Delhi4New Delhi – Dubai – New Delhi5Mumbai – Colombo- Mumbai6Mumbai – Bangkok- Mumbai7Mumbai – Dubai – Mumbai

Expansion Plans :

Kingfisher Airlines

Kingfisher Airlines will soon be commencing flights from New Delhi to London Heathrow along with six other new international routes. The launch of these new flights will further enhance the international route network of Kingfisher Airlines. The addition of these new services will mean that we will now be able to further leverage the unparalleled domestic route network of Kingfisher Airlines to maximize yields. With their unique domain expertise in aviation in general and in network planning in particular, Seabury, Kingfisher Airlines’ globally renowned advisors will ensure excellent connectivity for all these new services

Expansion Plans :

Kingfisher Airlines

Passengers(Kingfisher First/Kingfisher Class)

ATR 42-500 3 – – 48 (0/48) Both aircraft dry leased.17 66 (0/66)8 72 (0/72)

Airbus A319-100 3 – – 144 (0/144) All 3 dry leased.10 134 (20/114)3 67 174 (0/174)10 – 180 (0/180) 6 151 (32/119)2 – – 199 (0/199)

Airbus A330-200 5 15 – 217 (30/187) Deliveries through 2010-2012.Airbus A350-800 – 5 – TBD Deliveries starting 2014.Airbus A380-800 – 5 5 TBD Deliveries starting 2014.

Total 67 130 25

Kingfisher Airlines Fleet

Orders Options NotesIn Service Aircraft

2 dry leased.Airbus A321-200

ATR 72-500 38 20 15 new aircraft to be dry leased

Airbus A320-200 9 dry leased

Deliveries through 2010-2012.

Expansion Plans :

Kingfisher AirlinesFinancial Highlights

Total Operating Revenues of Rs 3776 Cr (-9% over YTD FY 09) (Domestic Revenues of Rs. 3412 Cr vs. Rs. 4132 Cr in YTD FY 09)

EBITDAR profit of Rs 485 Crvs. loss of Rs 442 Cr for YTD FY 09(Domestic EBITDAR of Rs. 679 Cr vs. loss of Rs.246 Cr in FY 09) -improvement of Rs 925 Cr

EBITDA loss of Rs. 355Crvs. loss of Rs. 1342 Cr in YTD FY09(Domestic EBITDA profit of Rs.15 Cr vs. loss of Rs 1058 Cr in FY 09) -improvement of Rs 1073 Cr

Revenue passengers carried 8.22 Mn vs. 8.11 Mn (up 1.4% over YTD FY09)

Kingfisher AirlinesCompany P&L

Apr 09 -Dec 09 Apr 08 -Dec 08 Variance %(Rs. Cr) (Rs. Cr)

3,776 4,168 -9%43 16 169%

3,819 4,184 -9%

Employee Remuneration & Benefits 531 620 -14%1,319 2,267 -42%1,484 1,739 -15%

485 -442

840 900 -7%4,175 5,526 -25%

-355 -1,342

156 125 25%818 529 55%

5,149 6,180 -17%

1329 1996 -33%300 -459

-554 -482

PROFIT / (LOSS) AFTER TAXATION -1,075 -1,055 2%

Particulars

Total Expenditure

Interest

Exceptional ItemLoss before exceptional items and Tax

Provision for taxation

Other Operating Expenses

EXPENDITURE

Aircraft Lease RentalsTotal Operating Expenditure

Depreciation

EBITDA

EBITDAR

INCOMEOperating RevenueNon Operating Revenues

Aircraft Fuel Expenses

Total Revenues

Kingfisher AirlinesProjected P& L for next 5 years

Apr 10 -Dec 10 Apr 11 -Dec 11 Apr 12 -Dec 12 Apr 13 -Dec 13 Apr 14 -Dec 14(Rs. Cr) (Rs. Cr) (Rs. Cr) (Rs. Cr) (Rs. Cr)

5098 6372 7965 10753 1462458 73 91 113 136

5156 6187 8056 10866 14760

Employee Remuneration & Benefits 637 701 785 942 11301583 1899 2944 4563 73011781 2137 2564 2949 3539

1155 1450 1762 2412 2789

1260 1410 1685 2060 2410

-105 40 77 352 379

234 276 414 621 9321068 1218 1068 1043 1018

-1407 -1455 -1405 -1312 -1570

200 240 250 260 275-550 -660 -625 -550 -850

PROFIT / (LOSS) AFTER TAXATION -1057 -1035 -1030 -1022 -995

Particulars

Interest

Exceptional Item

Loss before exceptional items and Tax

Provision for taxation

Other Operating Expenses

INCOMEOperating RevenueNon Operating Revenues

Aircraft Fuel Expenses

Total Revenues

EXPENDITURE

EBITDAR

Aircraft Lease Rentals

Depreciation

EBITDA

Kingfisher AirlinesKFA: Debt Profile

As of Dec-09

Working Capital 907

Short Term Loans 2,099

Long Term Loans 2,720

PDP Loans 363

Aircraft lease finance 802

Other Debt including Group 523

Total Debt 7414

Debt Profile INR Crores

Kingfisher AirlinesKey Initiatives planned to further enhance performance

Further Initiatives to generate higher revenues & improve consumer connect

New frequent flyer program launched with unique features like non-air rewards, family club etc.

New Internet booking engine driving greater consumer traffic towards online bookings

Incremental passenger connections generated through launch of ‘One Stop Connect’campaign

Kingfisher AirlinesKey Initiatives planned to further enhance performance

Stringent actions planned and undertaken to keep costs under control

Reduced lease costs by >25% (over Q3 FY09) through redelivery of non-operational aircrafts

Reduced personnel costs by >20% (over Q3 FY09) through replacing high cost expects

Planned to reduce Engineering costs by 10-15% by induction of new key vendor

Successfully implemented ‘Fuel Monitoring System’ for targeted reduction in fuel consumption

Exercised stringent controls across over heads to reduce costs e.g. Optimize office & warehouse spaces across all locations, planned reduction of communication costs etc.

Kingfisher Airlines

S.W.O.T. ANALYSISS.W.O.T. ANALYSIS

STRENGTHSSTRENGTHS

Strong brand value and reputation in the minds of customers.Strong brand value and reputation in the minds of customers. Quality of the service.Quality of the service. Route rationalization.Route rationalization. First airline to have a new fleet of airbuses.First airline to have a new fleet of airbuses. Quality and continuous innovation.Quality and continuous innovation.

WEAKNESSESWEAKNESSES

Still a not in profit organization.Still a not in profit organization. High ticket pricing.High ticket pricing. Facing a tough competition from competitors.Facing a tough competition from competitors.

Kingfisher Airlines

S.W.O.T. ANALYSISS.W.O.T. ANALYSIS

OPPORTUNITIESOPPORTUNITIES

The expanding tourism industry.The expanding tourism industry. The non penetrated domestic market.The non penetrated domestic market. International market.International market. Untapped air cargo market.Untapped air cargo market.

THREATSTHREATS

CompetitorsCompetitors Infrastructure issues.Infrastructure issues. Fuel price hike.Fuel price hike. Economic slowdown.Economic slowdown.

Thank You

Any Questions??

By

-Palak Thareja