31 July 2013

2013 First Half Results

2 2013 First Half Results | 31 July 2013

Disclaimer | Forward looking information

Certain information included in these statements is forward-looking and involves risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward looking statements.

Forward looking statements include, without limitation, projections relating to results of operations and financial conditions and the Company's plans and objectives for future operations, including, without limitation, discussions of the Company's Business Plan programs, expected future revenues, financing plans and expected expenditures and divestments. All forward-looking statements in this report are based upon information known to the Company on the date of this report. Due to such uncertainties and risks, you should not place undue reliance on such forward-looking statements, which speak only as at the date of this report. The Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by law or by any appropriate regulatory authority.

It is not reasonably possible to itemise all of the many factors and specific events that could cause the Company's forward looking statements to be incorrect or that could otherwise have a material adverse effect on the future operations or results of an airline operating in the global economy. Among the factors that are subject to change and could significantly impact the Company’s expected results are the fuel costs, competition from new and existing carriers, costs associated with environmental, safety and security measures, actions of governments and regulatory authorities, fluctuations in currency exchange rates and interest rates, airport access and charges, industrial relations, the economic environment of the airline industry and the general economic environment in the markets to which the Company operates.

3 2013 First Half Results | 31 July 2013

H1 2013 highlights

Additional long haul capacity deployed and sold at a higher yield

Short haul performance has been positive however impact of weak trading on UK

routes not fully compensated by increased demand on other routes

H1 2013 loss is within our overall plan

On track for full year profitability in 2013 to be broadly in line with 2012

Seasonality in our business is increasing – importance of Q3 and Q4

Positive forward booking patterns for Q3 2013 however impact of recent hot weather

has potentially impacted close-in higher yielding sales in July/August

Pension resolution process is ongoing – Labour Court recommendation a significant

step forward

Ongoing pension discussions however are impacting progress on cost saving

measures

4 2013 First Half Results | 31 July 2013

Introduction to 2013 Aer Lingus first half results

2013 First Half Financial Review Andrew Macfarlane, Chief Financial Officer

2013 First Half Commercial Highlights Stephen Kavanagh, Chief Commercial Officer

CEO Comments Christoph Mueller, Chief Executive Officer

5 2013 First Half Results | 31 July 2013

2013 First Half Financial Review Andrew Macfarlane, CFO

6 2013 First Half Results | 31 July 2013

Note on comparative figures

20,000

2012 United extended code share

Reported as “Other revenue”

Ceased operation in Q4 2012

Not included in our passenger/capacity

statistics

Revenue in “Other revenue” Q2 to Q4 2013 – rate per block hour basis

Start-up costs Q1, subsequent costs ACMI only

Not included in passenger/capacity statistics

Approx. €50 to €60 million of additional costs

Overall expected to add approx. €2m- €3m to full year operating profit versus 2012 .... however

Uneven quarterly impact

2013

Aircraft back in our fleet, flying from Q2 2013

Full year of ownership costs (maintenance,

depreciation, etc.)

Included in our passenger/capacity statistics

Long haul (7th aircraft)

Contract flying business

Full year – 2013 vs. 2012

7 2013 First Half Results | 31 July 2013

€m Unless otherwise indicated

H1 2013 % Change H1 2012 Change €’m

Total revenue Q1 259.7 +3.3% 251.5 8.2

Q2 398.2 +6.2% 374.8 23.4

Total 657.9 5.0% 626.3 31.6

Operating profit/(loss) Q1 (45.5) (36.1) (9.4)

(before exceptional items) Q2 29.1 31.7 (2.6)

Total (16.4) (4.4) (12.0)

Exceptional items (9.3) (19.8) 10.5

Profit/(loss) before interest & tax

(25.7) (24.2) (1.5)

€m 30 June 2013 % Change 30 June 2012 Change €’m

Gross cash 1,015.8 1,049.9 (34.1)

Debt (513.7) (572.2) 58.5

Net cash 502.1 477.7 24.4

First half 2013 financial highlights

Strong revenue growth; timing and one-off factors impacting profit

8 2013 First Half Results | 31 July 2013

Cost

Increase in H1 2013 operating loss before exceptional items

Strong revenue performance, particularly on long haul. Costs higher due to extra aircraft, contract flying, maintenance and FX

Revenue

(4.4) 1.6

3.0

7.0

15.5

4.5 (8.0)

(2.0)

(5.0)

(3.0)

(3.1)

(6.6)

(3.8)

(5.0)

(5.8)

(1.3)

(16.4)

H1 2012 operating loss

Retail/Cargo revenue

SH revenue LH yield/LF LH capacity Other revenue LH fuel Depreciation Cockpit and cabin staff

Op. lease and o/h

Maintenance Maintenance - Other

Airport charges

Ground ops and other

Other gains/(losses)

Other H1 2013 operating loss

Approx. impact of contract flying/7th aircraft

€5m phasing issues affecting H1 2013

operating result –

expected to reverse in H2 2013

9 2013 First Half Results | 31 July 2013

Fuel analysis Q2 2013 Q2 2012 % H1 2013 H1 2012 %

Fuel burn – Long haul 44.3 37.5 18.1% 74.0 65.9 12.3%

Fuel burn – Short haul 80.9 82.4 (1.8%) 139.0 142.9 (2.7%)

Total fuel burn (‘000 tonnes) 125.2 119.9 4.4% 213.0 208.8 2.0%

Avg. price per tonne (US$) 1,006 1,011 (0.5%) 1,015 988 2.7%

Avg. price per tonne incl. into-plane (US$)

1,064 1,069 (0.5%) 1,072 1,045 2.6%

Total fuel cost (US$m) 133.7 128.9 3.7% 229.4 219.8 4.4%

Average FX rate for period 1.29 1.30 (0.8%) 1.31 1.31 0.0%

Total fuel cost (€m) 103.3 99.3 4.0% 175.6 167.9 4.6%

Fuel costs – volume and price

Volume increase driven by additional long haul flying

H1 2012 Fuel cost Price Volume – SH Volume - LH FX H1 2013 Fuel cost

167.9 4.4 (3.1) 6.4 - 175.6

10 2013 First Half Results | 31 July 2013

Airport charges and staff costs in H1 2013

Airport charges up €3.8 million

Staff costs up €6.2 million

138.9

142.7

4.7

1.0 (0.9) (1.0)

H1 2012 Price Volume FX Other H1 2013

131.7

137.9

5.0

1.2

H1 2012 Contract flying/ 7th aircraft

Other H1 2013

Price increases at LHR, Italian and Spanish

airports

Volume driven by long haul

Favourable FX due to better EUR/GBP rate

Pilot and cabin FTEs higher due to contract

flying and 7th aircraft

VS programme in progress. Majority of exits

backended in 2013 with full year benefit in 2014

11 2013 First Half Results | 31 July 2013

Maintenance and depreciation costs in H1 2013

Maintenance charges up €9.7 million

Depreciation up €4.3 million

Impact of contract flying and 7th aircraft

De-icing and winter maintenance programme

Volatility from engine provisioning – “other”.

Charge of €3.3m expected to reverse over H2

Contract flying/7th aircraft driving increase

A320 held for sale in 2012, depreciated in 2013

Other costs include premises and IT

37.0

41.3

2.0

0.8 1.5

H1 2012 Contract flying/ 7th aircraft

A320 held for sale

Other H1 2013

25.6

35.3 3.1

1.4 1.9

3.3

H1 2012 Contract flying/

7th aircraft

De-icing Winter maint. programme

Other H1 2013

12 2013 First Half Results | 31 July 2013

Ground ops and other gains in H1 2013

Ground ops & other costs up €7.0 million

Other gains down €5.8 million – US$ hedging

Catering/in-flight costs higher to support premium

“sky deli” offering and additional volume

IT cost increase due to recent investment

Operations cost up – more passengers, bigger

fleet, impact of contract flying/7th aircraft

Other – timing difference expected to reverse in

H2

57.6

1.0 1.3

2.4

2.3

64.6

H1 2012 Ground Ops

& Other

Catering/ In-flight

IT costs Operations Other H1 2013 Ground Ops

& Other

1.34

1.40

1.31 1.31

1.47

1.43 1.44

1.37

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

1.20

1.25

1.30

1.35

1.40

1.45

1.50

H1 2010 H1 2011 H1 2012 H1 2013

€ m

illio

n

Ave

rage

USD

$/E

UR

Rat

e

Other gains/(losses) Avg actual USD$/EUR rate

Avg hedged USD$/EUR rate

Gains from FX hedging programme reduce as

hedge rate closes in on market/spot rate

At 30 June 2013, $118m hedged for H2 2013 at

an average rate of 1.33 – full year hedging gains

likely lower than 2012

13 2013 First Half Results | 31 July 2013

Exceptional costs

20,000

H1 2013 H1 2012

Voluntary severance programme and other restructuring (5.5) (11.7)

Impairment of A320 held for sale - (3.8)

Professional & legal fees (Ryanair bid defence, pension etc.) (3.8) (4.3)

Total charge (9.3) (19.8)

Note: H1 2012 restructuring provisions included costs associated with the relocation of hangar maintenance activities at

Shannon and Greenfield initiatives.

Our voluntary severance programme announced in April seeking a headcount reduction of 100 has

received applications in excess of our target. The cost of 37 employees fully committed to exit at 30

June 2013 is reflected in the figures above. Further severance costs expected in H2 2013 as

employees fully commit to the programme.

14 2013 First Half Results | 31 July 2013

Free cash flow in H1 2013

Strong cash generation in H1 2013

Seasonal working capital inflow driving increase of €173.5 million in working capital

€ million

Free cash flow represents cash generated from operating activities less net capital expenditure (purchases of fixed assets exclusive of finance lease raised less proceeds from disposals) plus or minus net interest received/paid

(28.2)

151.9

41.3

(3.3)

173.5

(22.6) 1.4

(10.2)

Loss before tax Depreciation Provisions Working capital Net capex Net interest received Other (incl exceptionals)

Free cash flow

15 2013 First Half Results | 31 July 2013

Strong balance sheet in H1 2013

Gross cash increased by €107.3 million, debt reduced by €17.9 million

Gross Cash €m

Debt €m

Debt repayments

H2 2013: €22 million

2014: €119 million

2015: €87 million

(531.6) (513.7)

(2.6)

23.1 (2.6)

Gross debt December 2012

Interest accrued Debt repaid FX Gross debt June 2013

908.5

1,015.8

151.9

0.8 (23.1) (21.3)

2.8 (3.8)

Gross cash December 2012

Free cash flow (FCF) Interest accrued Debt repaid Dividend FX Investment in JV

Gross cash June 2013

16 2013 First Half Results | 31 July 2013

2013 First Half Commercial Highlights Stephen Kavanagh (CCO)

17 2013 First Half Results | 31 July 2013

H1 2013 H1 2012 % Change yr on yr

Passengers (thousand)* 4,570 4,511 1.3%

Load factor * 75.6% 73.6% 2.0 pts

Total seats (thousand)* 6,367 6,408 (0.6%)

Passenger revenue (€’million) 538.4 512.9 5.0%

Retail revenue (€’million) 87.1 84.5 3.1%

Cargo revenue (€’million) 22.3 23.3 (4.3%)

Average fare per passenger (€) 117.80 113.70 3.6%

Average fare per seat (€) 84.56 80.04 5.6%

Continuing growth in unit revenue

H1 2013 Commercial highlights

* Excludes Aer Lingus Regional services operated by Aer Arann, the “Wet lease” agreement with Virgin Atlantic Airways Limited and the Washington Dulles – Madrid code share service operated in partnership with United Airlines in 2012.

18 2013 First Half Results | 31 July 2013

H1 Short-haul performance

• Revenue growth and customers

maintained at 4.1 million while capacity

reduced

• Fare revenue per seat +2.6% to €64.66

• Load factor +1.8 points to 73.6%

• Average fare per passenger +0.7% to

€91.09

• Average sector length reduced by -2.8% to

1,012 KMs

• Combination drove RASK by +5.4%

• Demand led with bias for frequency build

supported by development of Aer Lingus

Regional

19 2013 First Half Results | 31 July 2013

H1 Long-haul performance

• Strong revenue growth of +15.6% and

capacity increase of +10.8%

• Growth in customers exceeded capacity lift

as load factor added 1.6 points to 79.1%

• Fare revenue per seat increased +4.5% to

€269.90 as load factor and average fare

improvements combined

• Business Cabin occupancy increased +3.6

points to 65.2%

• Increased frequency to Boston and Chicago

successfully introduced in Q2

• Network connectivity and Dublin Hub

remains central to long-haul performance

20 2013 First Half Results | 31 July 2013

H1 Retail performance

• Revenue growth of €2.6M or +3.1%

• Strong recovery in Q2 with retail revenue per

passenger increasing +5.8% to €19.00 in spite of

change in relative network mix

• Retail initiatives in H1 included:

– Pre-order meals

– Banded baggage charges

– Administration charge increase

– Extended seat selection range

• With more discretionary options in production:

– Annual bag pass

– Priority boarding

– Pre-order sky shopping

21 2013 First Half Results | 31 July 2013

Market Share ex-ROI

Market position

Source: DAA, CAA figures

4.7

4.9

5.1

H1 2011 H1 2012 H1 2013

Passenger Numbers (Including Aer Lingus Regional) - million

+4.3%

+4.1%

• Consistent passenger growth achieved through effective network management and capacity deployment

40%

44% 44%

H1 2011 H1 2012 H1 2013

• The Aer Lingus offering has maintained market share, grown passenger numbers and yield in a recessionary market

Passenger Development

22 2013 First Half Results | 31 July 2013

Trade through short-term issues …

23 2013 First Half Results | 31 July 2013

CEO Comments Christoph Mueller, CEO

24 2013 First Half Results | 31 July 2013

Q&A

25 2013 First Half Results | 31 July 2013

€m Unless otherwise indicated

Q2 2013 Q2 2012 Change %¹

Revenue

Passenger revenue 328.6 311.3 5.6%

Retail revenue 50.6 46.9 7.9%

Cargo revenue 10.8 12.3 (12.2%)

Other 8.2 4.3 90.7%

Total revenue 398.2 374.8 6.2%

Operating costs

Fuel (103.3) (99.3) (4.0%)

Staff costs (73.2) (66.7) (9.7%)

Airport charges (83.6) (82.0) (2.0%)

Other operating costs (109.0) (95.1) (14.6%)

Total operating costs (369.1) (343.1) (7.6%)

Operating profit before net exceptional items

29.1 31.7 (8.2%)

Appendix A – Q2 2013 financial highlights

¹ Sign convention: favourable/ (adverse)

26 2013 First Half Results | 31 July 2013

Forward fuel price as at 30 June 2013 and at 29 July 2013

Fuel Q3 2013 Forecast

Q4 2013 Forecast

H2 2013 Forecast

2014 Forecast

Estimated burn (‘000 tonnes) 131 106 237 503

% hedged 88% 75% 83% 35%

Avg. hedged US$ price / MT 983 962 974 954

Appendix B - Fuel hedging as at 30 June 2013

Current level of hedging gives good protection against fuel price inflation for remainder of 2013

890

920

950

980

1010

1040

1070

1100

Historic Price Forward Curve as at 28th June 2013 Forward Curve as at 29th July 2013 Jet CIF NWE (US$/MT)