Athens International Airport

An attractive investment in challenging times

Yi i P hiYiannis Paraschis Capital Link Forum 2010

AIA is a pioneer PPP greenfield project

Hochtief Airport 26.67% Hochtief Airport Capital 13 33%

Greek State 55.00%Mi i t f E & Fi Hochtief Airport Capital 13.33%

• Hastings Fund Mngt (Australia)• Caisse de dépôt & placement du

Québec (Canada)• KfW-IPEX Bank (Germany)

C l F il 4 99%

• Ministry of Economy & Finance

• Ministry of Infrastructure, Transportation & Networks

1996-2026 “usufruct” BOT contract

Copelouzos Family 4.99%

1996-2026 usufruct BOT contract

A 2.2 billion Euro Project

60% f nded b commercial debt 60% funded by commercial debt

21 million pax capacity, expandable up to 50 million

f Airport Community: 2.14% of Greek GDP; 300 companies;

15,000 employees

…with concession period slated for extension

Greek State willing to extend concession period (revenues already in 2011 State Budget)…

…and explore options to capitalize on its shareholdings

Privatization of other Greek airports within state priorities

Widely accepted that new privatized airports will be based on AIA model

What makes AIA attractive?

A novel private sector governance

A new airport company created from “zero base”

A “commercial, profit-oriented company of the private sector”

b B d f Di t (4) P i t Sh h ld (4)run by a Board of Directors: (4) Private Shareholders, (4) Greek State , (1) Independent,

and CEO proposed by the private shareholders,and CEO proposed by the private shareholders,

with a very wide corporate scope of commercial rights and y p p gservices,

with a right to set Airport charges “under the Dual Till” p incipleprinciple,

with an option to be listed in the stock exchange

Demonstrating strong traffic performance until 2008

1,4001,3521 314

1,423 1,43517

18

1 400

1,600European airports 2001-7

15.516.2

16.5

15.1

16.5995 990 1,056

1,1491,232

1,314

15

16

17

1,000

1,200

1,400

ΑΙΑ

, mill

ion Europ

Pax, mill

CAGR 6.1%

12 2

13.714.3

12

13

14

600

800Pax,

AIA 2002-7 CAGR 6.9% AIA

-0.4% AIA

-4.6%AIA

-1.5%

2008:Recession

starts/High fuel prices

2009:Europe in

deep recession

pelion2010:Europe exits

recession/Greek financial crisis

10.2 11.8 12.2

9

10

11

0

200

400Europe +0.7%

Europe +3.6%Aug YTD

Europe -5.5%

9Apr-Dec

20012002 2003 2004 2005 2006 2007 2008 2009 2010e

0

AIA Traffic Europe Traffic

From 2008 onwards, the recession -with different timing , g

vs. Europe- affects AIA traffic

With continuous revenue and profit growth and healthy cash position

420.5

356 5399.3

243.9

400

450

220240260

PBTR 403.2

227.4271.5

290.8329.8 331.7 356.5

156.5149.6176.8

99.3145.8124.9

163.7

250

300

350

100120140160180200220 PBT

Mn €Revenues& Closing CashMn €

28.914.3 29.0

47.157.7

96.3124.8

105.8 104.0

50

100

150

200

020406080100

-9.614.3

0

50

Apr-Dec2001

2002 2003 2004 2005 2006 2007 2008 2009-40-200

PAX PBT Closing cash

2002-9 shareholder dividends €493 million

2001 10 month2001-2004 PBT is based on GAAP2005-2007 PBT is according to IFRS2009 PBT excluding once-off provisions impact of €108.0 m

Restructured EIB loan & early loan repayments to lower debt costs

Total Repaid by 2005

1200

1400Shareholder LoanCommercial Loan

€328

Total€1,370 m

€45 m

Repaid by 2005

€328 m

€, m

800

1000EIB€328 m

€244 m Restructured with EIB in 2009

Repaid by 2008

€

400

600

800

€997 m €754 m

200

400

0Initial Repaid 2001-10 November 2010

At the top of European airports benchmark

At top 3 of European

Total Revenue / Passenger

24.0

30.0

At top-3 of European

airports in revenue

generation0.0

6.0

12.0

18.0

w s s o s h p m a h n t n p i A i A

SDR

/ p

ax

generation

Lond

onH

eath

row

Aer

opor

tsde

Par

is

Ath

ens

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o

Bru

ssel

s

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ch

BA

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roup

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ster

dam

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up

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nna

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ich

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enha

gen

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ort

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roup

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ti d

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ilano A

NA

Aer

opor

ti d

iR

oma

AEN

A

Total revenue / pax Average

NoteMonetary units in SDR (Special Drawing Right)Figures as per 2008 financial year Source: Jacobs Consultancy Airport Performance

Indicators 2010

Non-Aeronautical Revenue / Passenger

12.0

In addition to high

ae o e en es

0.0

6.0

Osl

o

don

hro

w

hen

s

port

sar

is

port

ssel

s

rou

p

rou

p

nic

h

rich

dam

p agen

rti d

in

o

enn

a

rti d

ia A

NA

ENA

SD

R /

pax aero revenues…

…AIA also excels in

commercial activitiesO

Lon

dH

eath Ath

Aer

opde

Pa

Fra

Bru

s

BA

A G

r

Ber

lin G

r

Mu

n

Zu

Am

ster

dG

rou

Cop

enh

a

Aer

opor

Mila

n

Vie

Aer

opor

Rom

a A A

Non aero revenue / pax Average

NoteMonetary units in SDR (Special Drawing Right)Figures as per 2008 financial year

Source: Jacobs Consultancy Airport Performance Indicators 2010

commercial activities

…with first position in profitability

AIA offers value for

Operating costs / Passenger

12 0

16.0

AIA offers value-for-

money services…

maintaining cost0.0

4.0

8.0

12.0

on row

nich

orts

aris

dam

p erlin ou

p

oup

rich

Osl

o

port

sels

enna

hens

ti d

io ge

n

AN

A

ti d

ia EN

A

SD

R /

pax

…maintaining cost

competitiveness

Lond

Hea

thr

Mun

Aer

opo

de

Pa

Am

ster

dG

roup Be

Gro

BA

A G

ro

Zu

O

Frap

Bru

ss

Vie

Ath

Aer

opo

rtM

ilano

Cop

enh

a A

Aer

opo

rtR

oma

AE

Operating Cost per pax Average

NoteMonetary units in SDR (Special Drawing Right)Figures as per 2008 financial year

Source: Jacobs Consultancy Airport Performance Indicators 2010

High performance in

all al e d i e s

EBIT / Passenger

11.2

14.0

x all value drivers…

…leads to No 1

position in profitability0.0

2.8

5.6

8.4

hens

Osl

o

ssel

s

agen

port

sar

is

enna

uric

h

rou

p

port

dam

up don

hrow AN

A

rti d

ia er

linro

up

rti d

ino ni

ch

ENA

SD

R /

pax

position in profitabilityAth O

Bru

s

Cop

enh

a

Aer

opde

Pa

Vie Zu

BA

A G

r

Frap

Am

ster

dG

rou

Lond

Hea

th

A

Aer

opor

Rom

a

Be

Gr

Aer

opor

Mil

an Mun A

E

EBIT per pax AverageNoteMonetary units in SDR (Special Drawing Right)Figures as per 2008 financial year

Source: Jacobs Consultancy Airport Performance Indicators 2010

2010 poses challenges for AIA…

Greek economy crisis Impact on Greek travellers’ traffic demand & business travel EU/ECB/IMF pressure on production costs & prices Athens retail & property market

y

Athens city destination profile Corporate taxation (from 24% to 40%+)

Privatised Olympic and Aegean announce merge

Developments in Athens aviation market Privatised Olympic and Aegean announce merge…

…under EU’s Competition Committee scrutiny

Consolidation of network already evident with impact on traffic

P d f d d t k d btf l t i bilit f Pros and cons of merge: reduced network vs. doubtful sustainability of two carriers

How can airport management respond?

Macroeconomic Environment

II. Reduce operating costs

III. Optimise I. Defend

Athens

pinvestmentsRevenues

AthensAviationMarket

IV. Maintain service level

In a low-growth environment, costs become a major value driver

I. Defending revenues

Aero revenues: defending volumes, protecting margins

Commercial revenues: retain high share (41% of revenues – 65%

of profits)

II. Reducing operating expenses

Outsourcing strategy 3rd party costs reduction exercise in 2008/9 with 10% opex

savings Staff reduced since 2008 through attrition and non-replacement

Adapting to changes: flexibility in investment planning necessary

III. Optimizing investments

“Sweating the assets”

Investing in value-adding activities: 8MW Photovoltaic park

p g

Investing in value adding activities: 8MW Photovoltaic park,

Car Parking, External business activities

IV. Maintaining service level

Value-for-money services a key strategy

AIA unique model for service level monitoring AIA unique model for service level monitoring

Already achieved significant cost reductions

Total operating costs

139 0135.0

125.8129.2

126.8

139.0 Base costs: 2008 actual, inflated onwards

117.3123.4 122.0 119.5114.5€,

m

Actual costs & projections

90.0

102.3

2008 2009 2010 20112008 2009 2010 2011Note: Base costs adjusteda) For 2008, security costs incorporate FY effect of critical partsb) For 2008 and 2009, maintenance costs exlude the impact of major once off items

In 2011 opex reduction will reach 13%

Projecting healthy profitability of >35% PBT despite market downturn…

16 5 16 216.5

15.114.3

13.7

16.5 16.215.5

31% 36%37%

35-37%15

17

35.0%

45.0%

illio

n PBT

12.211.8

10.219%

27%

31% 35 37%

11

13

15.0%

25.0%

Pax,

mT, %

-4%

5%10%

14%

9 5.0%

4%7Apr-Dec

20012002 2003 2004 2005 2006 2007 2008 2009 2010e

-5.0%

Traffic Profit Margin

Source: AIA Management Information System

2001 10 month2001-2004 PBT is based on GAAP2005-2007 PBT is according to IFRS2009 PBT excluding once-off provisions impact

…AIA remains an attractive investment opportunity

Despite areas of investors’ concern…

Concession period

Macro environment Corporate Tax

…AIA demonstrates strong points and constitutes an

attractive investment opportunity

Traffic & aero activities

Commercial activities Regulation Infrastructure Financial

Performance

Concession

To be further enriched…

Concession Extension