625624

60

22 Ulansky Lane, Building 1,Moscow 101000, Russia

Tel.: +7 (495) 926-1420Fax: +7 (495) 926-1421

www.uacrussia.ru office@uacrussia.ru

00

First delivery

2016Testing and serial production preparation

1

Dear colleagues,

PAK FA Multirole generation 5 fighter

1

The main strategic objective of the United Aircraft Corporation is to achieve long-term competitiveness among global aircraft engineering market leaders.

The strategic target of the Corporation is to achieve at least $25 billion of annual revenues and at least 10% net profit by 2025. Labor productivity must increase by a factor of 7.3. We believe that increasing the operating performance in the field of civil aviation while retaining leading positions in the field of military aviation will enable us to perform the strategic objective of creating one of the world's largest international aircraft building holdings the basis of UAC.

This new model of leadership is based not only on our achievements in the global military aircraft market where we are already in top three but also on capturing leading positions in the segment of civil and transport aviation.

President, Chairman of the Board of UACMikhail Pogosyan

THE CORPORATION TODAY

2 3

01THE MISSION CORPORATION HUMAN RESOURCES

KEY FIGURES 2008 to 2013

87 465

2008 2009 2010 2011 2012 2013

2008 2009 2010 2011 2012 2013

98 572 140 682 161 653 171 019 220 065

AIRCRAFT DELIVERIES

REVENUES, MLN RUBLES

53 95 74 102 94 111

SUSTAINED AND SUBSTANTIAL ANNUAL GROWTH OF UAC PERFORMANCE:

• PRODUCT DELIVERIES INCREASED BY MORE THAN 16%

• SALES/REVENUES INCREASED BY MORE THAN 20%

• OUTRUNNUNG GROWTH OF CIVIL AIRCRAFT EQUIPMENT SHARE IN THE TOTAL DELIVERIES IN ACCORDANCE WITH THE CORPORATION DEVELOPMENT STRATEGY: 26% (IN 2013)

TO ACHIEVE AND RETAIN LONG-TERM COMPETITIVENESS OF RUSSIA'S AIRCRAFT INDUSTRY IN THE GLOBAL MARKET TO DEVELOP, MANUFACTURE AND PROVIDE AFTER-SALES SERVICE TO MILITARY AND CIVIL AIRCRAFT WITH A PRIORITY ASSIGNED TO THE NEEDS OF STATE CUSTOMERS

7

13

15

2012

2013

2014

50 000 10 000 2 500

NUMBER OF UAC BASE COLLEGES

641

660

623

TARGETED TRAINING OF SPECIALISTS AT COLLEGES IN ACCORDANCE WITH UAC SUBSIDIARIES REQUESTS

7 327

1 586

2 276

VOLUME OF R&D CARRIED OUT IN COOPERATIONWITH UNIVERSITIES AND RESEARCH ORGANIZATIONS,MLN RUBLES

SCHOLARS STUDENTS OF HIGHERAND SPECIAL SCHOOLS

EMPLOYEES

• Сareer consulting• Profile classes• Targeted recruiting• Competitions, olympiads• Days of the Corporation

• Educational programs• Basic chairs• Networking• Practical training at UAC enterprises• Competitions, olympiads• Research and engineering projects• Professional development

• Corporate training and rotation• Individual career trajectories• Personnel reserve formation• Pofessional standards

МAI, KAI, SGAU, MFTI,MATI nabed after Tsiolkovsky, MGTU named after BaumanNGTU NizhGTUnamed after Alekseyev, TPU, DVFU, IrGTU, KnAGTU, TPU, VGTU, YuFU

Sukhoi, MiG, TANTK named after Beriyev, Tupolev,Irkut, VASO, Il'ushin,Aviastar-SP, EMZ named after Myasishchev, Gromov Flight Test Institute, NAZSokol, NAZ named after Chkalov

Annual recruitment and profesisonal development programs:

UAC KEY ASSETS

4 5

01 THE CORPORATION TODAY

20 ARZ OJSC121 ARZ OJSC123 ARZ OJSC275 ARZ OJSC308 ARP OJSC322 ARZ OJSC 325 ARZ OJSC360 ARZ OJSC514 ARP OJSC 720 RZ SOP OJSCVZRTO OJSC32 RZ SOP OJSC170 RZ SOP OJSC 680 ARZ OJSC 31 ZATO OJSC

UIS functions. Participation in joint activities Preparing for transfer into management

Aircraft Repair Plants

62,7% RSK MiG OJSC

95,45% Irkut Corporation OJSC

82,12% Yakovlev OKB OJSC

98,7% G.M. Beriev TANTK OJSC

83,19% Sukhoi Company OJSC

75% SCAC CJSC

49%

99,3% AeroComposite CJSC

100% UAC-TS OJSC

96,64% VASO OJSC

100% Aviastar-SP CJSC

100% V.M. Myasischev EMZ OJSC

15% V/O Aviaexport OJSC

100% NAZ Sokol

89,31% Finance-Leasing OJSC

93,25% M.M. Gromov LII OJSC

100% UAC Integration Center LLC

100% UAC-Procurement LLC

91,85% Tupolev OJSC

49,64% IFC LLC

Super Jet International 25% 100% MTA Ltd

50% UAC-Antonov CJSC

100% KAPO-Composite CJSC AeroComposite-Ulyanovsk CJSC

87,48% IL OJSC

UAC 0,35%

1,24%

10,06%

9,71%

9,28% 3,05% 3,8%

78,49%

9,5%

3,4%

39,97%

Nonprofit PartnershipNational Aircraft Engineering Center

100% IL-Resource CJSC

100%

0,01%

NTsA LLC99,99%

75,46% 96,25%

60,03%

90,5%

48,4%

89,44%

8,99%

79,36%

85,74%

99,65%

6,66%

100% NAZ Sokol

0,35%

99,65%

Total share owned by UAC OJSC in the companyCompany name

Company share indirectly owned by UAC OJSC

Company share directly owned by UAC

INVESTMENTSIN INDUSTRY RETOOLING

INNOVATIVE DEVELOPMENT

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01 THE CORPORATION TODAY

СOMPOSITE WINGIntroduction of advanced technologies of mixed packages from polymer composites

MOTOR-OPERATEDWHEELEnabling aircraft taxiing through the use of motor-operated landing gear wheels to reduce harmful emissions at the airport

NACELLESCost reduction

AVIONICSNew highly reliable systems are built using open architecture Weigt, cost, reliability, functionality

NOISE SUPPRESSIONSYSTEMComfort increasedby reducing the noise level in the passenger cabin and crew cockpit to 72dBA

HIGH-POWERELECTRIC ACTUATORS

INVESTMENT IN RETOOLING ISA STRATEGIC PRIORITY OF UAC. IT ENABLED US TO BUILD:• COMPETITIVE PRODUCTION CAPACITIES• ENVIRONMENT FOR ATTRACTING DOMESTIC AND FOREIGN PRIVATE INVESTMENTS• PROFESSIONAL STAFF DEVELOPMENT SYSTEM

LABOR PRODUCTIVITY, %

OUTPUT PER WORKER,MLN RUBLES

2010 2011 2012 2013

1,58 1,89 2,48 3,28

96,8 109,2 131,1 136,5

200820072006 2009 2010 2011 2012 2013

Equity

State support

Federal Targeted Program

18,610 MLN RUBLES

25,353 MLN RUBLES

3 192

4 186

5 772 5 460

5 460

6 714

8 7949 845

INVESTMENTS, MLN RUBLES

UAC IS CONTINUOUSLY SEARCHING FOR AND ANALYZING THE MOST PROMISING AND EFFICIENT INNOVATIVE TECHNOLOGICAL SOLUTIONS AND IDEAS TO STRENGTHEN THE POSITIONS OF DOMESTIC AIRCRAFT ENGINEERING AS A WORLD LEADER IN THE LONG TERM. RESEARCH IS UNDERWAY IN THE ENERGY INDUSTRY, CHEMISTRY, MATHEMATICS, AND DEVELOPMENT OF NEW MATERIALS AND SMART INTELLIGENT DESIGNS, ELECTRICAL COMPATIBILITY, AND OTHER FIELDS OF SCIENCE

TARGET BUSINESS STRUCTURE

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02 THE CORPORATION TOMORROW

THE CORPORATION IS AN INTEGRATED HOLDING WHERE UAC PLAYSTHE ROLE OF A COMPANY HOLDING SHARES OF AIRCRAFT MANUFACTURERS

THE CORPORATE CENTER MANAGES PRODUCT BUSINESS UNITS IN THE TARGET STRUCTURE ACTING AS A 'STRATEGIC ARCHITECT' AND PERFORMING STRATEGIC, FINANCIAL, INVESTMENT AND OPERATIONAL CONTROL, DEVELOPING THE STAFFING POLICY, AND PROVIDING POLITICAL AND INFORMATION SUPPORT TO GROUP ENTERPRISES

QUANTITATIVE UAC OJSC DEVEL-OPMENT INDICATORS BY 2025:

UAC PLANS A CONSECUTIVE TRANSFORMATION FROM THE CURRENT COMPANY ACTIVITY PROFILE TO A COMPANY INTERESTED NOT ONLY IN PRODUCTION, BUT ALSO SERVICING ITS PRODUCTS AT ALL LIFECYCLE STAGES:

The main business activity profile is supplying aircraft, implementing some after-sales service program elements, and providing a limited set of services

21 3

2013 2015 2016 2020 2021 2025

Extending the business activity profile while increasing the mass aircraft production, offering R&D services, providing a complete aircraft aftersale service

Creating an infrastructure for transition to value chain management

Generating the cash flowat all product life cycle stages and implementing the value chain management principles

Developing strategic cooperation based on the principles of risk-shared partnership and participating in perspective international projects

Combat Aviation

Civil Aviation

Transport Aviation

SpecialAviation

UAC-Service

Business units

Specialized productionfacilities

Competencecenters

Technologyparks

UAC (corporate center)

UAC WILL BECOME THE THIRD LARGEST PLAYER IN THE WORLD AIRCRAFT MARKET ACCOUNTING FOR AT LEAST 3.2% AND 10.2% OF CIVIL AND MILITARY AIRCRAFT MARKETS, RESPECTIVELY. UAC SHARE IN THE COMPETITIVE MARKET OF MILITARY AIRCRAFT: AT LEAST 1 8%, SALES SHARE IN THE CIVIL NARROW-BODY AIRCRAFT SEGMENT: AT LEAST 8%. OUTRUNNING GROWTH OF CIVIL AIRCRAFT SALES WILL ENABLE THEM TO ACHIEVE AT LEAST 40% OF TOTAL UAC REVENUES, NET PROFIT MARGIN EXCEEDING 10%

Competence centers are centers producing aircraft components and ensuring the development, manufacture, and support for their products

First delivery

2011Serial production

Su-35Heavy multirole4++ generaiton fighter

12 13

03 PRODUCT PORTFOLIO

CIVIL AVIATION

1993

2025 г

Date of first delivery 2009

Planned projects

Long-haul

Wide-body

257 to 289 passengers

Serial production

Mid-range

Narrow-body

210 passengers

Serial production

Short-haul

Narrow-body

75 passengers

Serial production

AN-148

2017

Mid-range

Narrow-body

150 to 180 passengers

In design

MS-21 *

IL-96

1994

TU-204, TU-214, TU-204SM

2011

SUKHOI SUPERJET 100 *

Short-haul

Narrow-body

98 passengers

Serial production

03 PRODUCT PORTFOLIO

MILITARY AVIATION

14 15

Serial productionSerial productionSerial productionSerial production

Serial production Development and production preparation.Date of first delivery: 2016

Testing and productionpreparation

At the initiation stage

Heavy multirole 4+ generation fighter

Heavy multirole generation 4++ fighter

Heavy frontline generation 4+ bomber

Medium-range multirole generation 4+ fighter

Medium-range multirole generation 4++ fighter

Heavy multi-role generation 5 fighter

Strategic missile bomber

Combat trainingand training aircraft

1996

2011 2011 2016 2022-2025 2030

Date of first delivery 2008 2010

Su-30 Su-34 MiG-29K/MYak-130

Su-35 MiG-35 PAK FA PAK DA

20092009

03

First delivery

2014Serial production

Maximum payload capacity

А

B

PRODUCT PORTFOLIO

TRANSPORT AVIATION IL-76MD-90AHeavymilitary transport aircraft

16

Heavy military transport aircraft

IL-76MD-90A

Light military transport aircraft:

IL-112V

Medium military transport aircraft

Russian-Indian project of multipurpose transport

aircraft (MTA)

Super-heavy military transport aircraft:

Family of prospective transport aircraft

(PLA)

RA-112001

2014

2018 2025

Date of first delivery 2017

60t

Serial production

5...10t

In design

80t, 160t, 240t

At the planning stage

20 t

In design

78650

MTA

60t