Arturs SaveljevsDirectorCommercial Department

NCCL Executive Industrial Policy SeminarRiga, November 5, 2009

The Strategy and Implementation of Riga airport as a Baltic Hub

Introduction to RIGA Airport● RIGA Airport was built in 1974. It was used for domestic flights within the USSR

● After Latvia regained its independence in 1991 – RIGA Airport became aninternational Airport

● RIGA International Airport is operated by SJSC RIGA International Airport

● The owner of all shares is the Republic of Latvia

● Airport occupies the area of 650 ha

● Airport has more than 1300 employees

● The annual turnover is 35 million EUR (2008)

Continuing development

Runway rehabilitation (1994) New arrivals terminal (1999) Pier (2001)

Non-Schengen terminal (2006) Runway extension (2008)

New terminal (~2013)

2004 - breakthrough:

● Airport charges were lowered

● Latvia joined European Union

● First low-cost airlines started their operations at RIX

+77%

+17%

+27%

+33%

+10%

Passenger statistics

Baltic Passenger Traffic 2000 - 2009Today RIGA International Airport is the no.1 airport in the Baltic States, providing Service of the highest quality and having a very significant role in the development of Latvia

Source: Riga Airport, Tallinn Airport, Vilnius Airport

50 000

550 000

1 050 000

1 550 000

2 050 000

2 550 000

3 050 000

3 550 000

4 050 000

4 550 000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009*

* forecast

• Riga is located within a 300km radius of all three Baltic capital cities

• The map illustrates a 300km radius from capital cities Vilnius and Tallinn

• Riga has a direct access to more than 7 million citizens of Baltic states

• RIGA International Airport is the principal gateway for international visitors to Latvia and Baltic States

RIX, the centre of the Baltic’s!

Passenger Traffic Forecast

0

2

4

6

8

10

12

14

16

2008 2012 2018 2023 2028 2032

Pa

ss

en

ge

rs (

m)

IATA’s Long Term Passenger Forecast suggests that Riga Airport will behandling 14 million passengers by 2032

Source: IATA

Airlines serving Riga

Market Share Jan-Sep 2009(Passenger Base)

Air Baltic Corporation

Ryanair

KLM

SmartLynx Airlines

Norwegian Air Shuttle

CSA

Lufthansa

Finnair

Aeroflot

Turkish Airlines

65 %22 %

The main carrier at RIGA International airport is Air Baltic – the national airline of Latvia

* top 10 airlines

Successful Development of Passenger Transfer Hub

Jan-Sep 2009 32 % of RIX passengers were transfer passengers

Source: Riga Airport

2007

93%

7%

Transfer O&D

2008

16%

84%

Transfer O&D

Jan-Sep 2009

32%

68%

Transfer O&D

In JAN – SEP 2009 the transfer passenger volume has grown by 194 % comparing to the same period in 2008

Riga Airport’s Network

Integral Part of the Baltic Sea RegionMore than 370 direct flights per week to Baltic Sea Region,the fastest growing region in Europe!

East meets West in Riga!Expanding Eastern network

RIX, the most competitive airport for locationand price!

November 1, 2009 RIX has introduced the lowest fees inEurope for a capital city airport

Airport services charges for B737-500 in EUR

0.00

500.00

1000.00

1500.00

2000.00

2500.00

3000.00

total cost 631.00 1838.52 2179.17 2225.60 1817.47 2589.03 2195.79 2124.57 2422.52

RIX (Riga) TLL (Tallin) VNO (Vilnius)HEL (Helsinki)

*ARN

(Stockholm)**CPH

(Copenhagen)OSL (Oslo)

LED (St.Petersburg)

WAW (Warsaw)***

Currency exchange rates used from July 2009Source:Riga International Airport, Tallinn Airport, Vilnius Airport, Helsinki AirportArlanda Airport, Copenhagen Airport, Oslo Airport, St. Petersburg Airport, Warsaw Airport

2.05 EUR8.12 EURLanding fee

Per 1000 t (MTOW)

3.10 EUR12.18 EURPassenger fee

Per departing PAX

New feesOld feesAirport fee

Business Park developmentThe total area of Business Park is more than 90 ha

Logistic centre, cargo warehouses, mail sorting centre, pilot’s academy are already built

Hotels, exhibition centre, convention centre, office buildings, car parks will be built in the near future

Total investments: ~ 300 million EUR

Baltic Business Aviation Centre1st stage of the Project includes:

● Construction of Business Aviation passenger terminal (~400 m2)

● Construction of aircraft hangar (~2500 m2)

After opening:

● BBAC will be able to handle more than 2000 flights per year

● More than 50 Business Aviation aircrafts is planned to be based at RIGA International airport

TOTAL investments: ~ 5 000 000 EUR

Opening date: 31 MAR 2010

MRO CentreThe Project includes:

● Construction of technical hangar for aircrafts: B737, B757, A319, A320, A321, etc. (~10 000 m2)

● Development of technical laboratories

● Development of educational center for aviation engineers and technicians

TOTAL investments:~ 8 500 000 EUR

Opening: 2012

Aviation vs Non-aviation2000

77%

23%

Aviation income

Non-aviationincome

2009*

58%

42%

Aviation income

Non-aviationincome

* forecast

2008

60%

40%

Aviation income

Non-aviationincome

Non-aviation income share has grown from 23 % in 2000 to 42 % in 2009 (forecast)

International recognition

RIGA International Airport - winner of Routes Europe the Airport Marketing Award 2009 as the best airport in Scandinavia & the Baltic’s

For a regional airport to achieve positive results in a tight competition it is vital to work hand in hand with government institutions and airlines

To become a successful airport it is very important to be commercially orientated, putting as much emphasis on non-aviation business as on aviation business

Conclusion

Thank you!