FY18 Earnings Conference Call Agenda Headline Results FY18 - PowerPoint PPT Presentation

FY18 Earnings Conference Call

Agenda Headline Results FY18 Highlights FY18 Financial Review Q&A

Disclaimer The content and information of this document is only intended to provide users with financial and operational information about Jazeera Airways. No warrant or representation is made by Jazeera Airways for the contents of this document and in no way is the material provided in it intended to solicit an investment in the company. Any investments made by the users of this document are made based on their own discretion and analysis and the final decision and responsibility for investments rests solely with the user of this document and its content. Specific content of this document is provided by third parties. Despite doing its best efforts, Jazeera Airways does not guarantee in any way the accuracy or completeness of the data provided by these third parties and cannot be held responsible for the use of information provided in these sections. While Jazeera Airways makes all reasonable efforts to make certain that all information on this document is true, accuracy cannot be guaranteed and the company does not undertake any responsibility for the correctness of the information contained in it and its contents. Jazeera Airways as well is not to be held legally responsible under any circumstances for any damages resulting from data falsification by third parties, data download or any other use of the content provided on this document. Certain sections or material provided on this document e might contain forward-looking forecast or statements. Such statements do not guarantee the future financial or operational performance of the company. Furthermore, these statements involve a high degree of uncertainty risks that could cause actual results to be materially at variance from those proposed in the forward-looking statements. Accordingly, these statements should only be used as indicative plans and the responsibility of any decisions based on them lies solely on the user without any involvement from Jazeera Airways. Information provided in this document is subject to change without prior notice at any time. Jazeera Airways does not assume any responsibility for any troubles, losses, or damages resulting from the use of this document and will not be liable for any inaccuracies, or errors in the content, or for any actions taken in reliance thereon. Jazeera Airways also does not assume any duty of disclosure beyond that imposed by law, and expressly disclaims any duty to update any information set forth herein.

Headline Results

Headline Results 4Q18 Operational Highlights Passengers Load Factor Utilization Yield +52.5% +1.7% +39.6% +12.4% 4Q18: 478 k 4Q18: 70.7% 4Q18: 14.8 hrs 4Q18: 38.0 KWD 4Q17: 333 k 4Q17: 69.0% 4Q17: 10.6 hrs 4Q17: 33.8 KWD

Headline Results FY18 Operational Highlights Passengers Load Factor Utilization Yield +46.4% +1.3% +24.7% -2.1% 2018: 2.0 million 2018: 75.2% 2018: 13.6 hrs 2018: 40.8 KWD 2017: 1.4 million 2017: 73.9% 2017: 10.9 hrs 2017: 41.7 KWD

Headline Results 4Q18 Financial Highlights Operational Revenue *Operational Profit *Net Profit KWD18.7 mn -KWD2.2 mn -KWD1.8 mn (Adjusted: -KWD1.3 mn – YoY: -30.0%) (Adjusted: -KWD0.9 mn – YoY: -34.1%) 4Q18: -KWD2.2 4Q18: -KWD1.8 4Q18: KWD18.7 4Q17: -KWD1.8 4Q17: -KWD1.4 4Q17: KWD10.6 Difference: 20.8% Difference: 32.1% Difference: 76.3% * Includes KWD651k one offs related to irregular events in 4Q18 and KWD256k operating loss related to facilities operations.

Headline Results FY18 Financial Highlights Operational Revenue *Operational Profit *Net Profit KWD82.4 mn KWD6.8 mn KWD6.7 mn (Adjusted: KWD8.8 mn – YoY: 13.9%) (Adjusted: KWD8.7 mn – YoY: 5.2%) 2018: KWD6.8 mn 2018: KWD6.7 mn 2018: KWD82.4 mn 2017: KWD7 .7 mn 2017: KWD8.2 mn 2017: KWD56.6 mn Difference: -12.1% Difference: -19.0% Difference: 45.5% * Includes KWD1.5 mn one offs related to irregular events in 2018 and KWD534k operating loss related to facilities operations.

Headline Results FY18 Commercial Highlights E-Commerce Sales Ancillary Revenue +11.8% Vs. 2017 +40.8% Vs. 2017

Headline Results Network Highlights 43% Market Share 25% Launched In Market Share 1%* Q1 Q2 Q4 Market 2018 2018 2018 Share ** 42% Ahmedabad Tbilisi New Delhi Kochi Lahore Market 13% Mumbai Medinah Share Market Share 27% Market * New Delhi was operational in the last two weeks of 2018 Share ** Medinah is operated on a seasonal basis

Headline Results Network Highlights Passengers Geographic Distribution Passengers Geographic Distribution FY17 FY18

Headline Results Network Highlights Jazeera Market Share Kuwait International Airport Traffic FY14 – FY18 FY14 – FY18 In million In million Other passengers Jazeera passengers Jazeera market share KIA passengers Passenger growth

Headline Results Fleet Highlights Current fleet of 9 aircraft, up from 7 at The latest addition was the first the end of 2017 . A320neo to be delivered in the region. The A320neo offers: • Significant fuel savings up to 18% over traditional engines. • Allows more flying time expanding flying Contracts signed for 3 new A320neos to radius to +6hrs. be added to the fleet in 2019. • Improved customer experience due to lower noise.

Headline Results Jazeera Facilities Jazeera Terminal started operations in May 2018. Jazeera Terminal carried 1.27 mn Collection of check-in charges passengers since opening in May 2018. commenced from the start of operations. Retail leasing ongoing while all Duty free and airside retail are now fully concessions are now actively serving operational. Jazeera passengers.

Financial Review

Key Parameters FY18 • Capacity increased by 44% though number Operating Parameters FY17 FY18 CHANGE of aircraft increased only by 23%. Average Aircraft 7 .0 8.6 22.6% Destination Cities 19 26 36.8% • This was achieved by 25% improvement in daily utilization of the capacity. Revenue Drivers FY17 FY18 CHANGE Seats 1,838,244 2,642,110 43.7% Passengers 1,357 ,745 1,987 ,286 46.4% Major reasons for adverse Load Factor 73.9% 75.2% 1.4% variances FY17 Vs FY18 Net Yield 41.7 40.8 -2.0% • Fuel Price increase (KWD4.4 mn) Profitability Drivers FY17 FY18 CHANGE • Yield reduction due to fierce competition Sectors 11,569 16,194 40.0% (KWD 1.5 mn) Block Hours 27 ,857 42,540 52.7% Utilization (BH per Day) 10.9 13.6 24.6% • One time costs (KWD 1.5 mn) • Terminal loss (KWD 0.5 mn)

Key Parameters 4Q18 Operating Parameters 4Q17 4Q18 CHANGE Major reasons for adverse variances Average Aircraft 7 .0 9.0 28.6% 4Q17 Vs 4Q18 Destination Cities 18 25 38.9% • Fuel Price increase (KWD 1.1 mn) Revenue Drivers 4Q17 4Q18 CHANGE Seats 454,361 675,644 48.7% • One time disruption costs (KWD 0.7 mn) Passengers 313,356 477 ,988 52.5% Load Factor 69.0% 70.8% 1.8% • Terminal losses (KWD 0.3 mn) Net Yield 33.8 38.0 12.5% Profitability Drivers 4Q17 4Q18 CHANGE Sectors 2,858 4,160 45.6% Major reasons for favorable variances Block Hours 6,821 11,154 63.5% 4Q17 Vs 4Q18 Utilization (BH per Day) 10.6 13.5 27 .2% • Yield increase of 12% (KWD 2 mn) Financial Performance 4Q17 4Q18 CHANGE Operating Revenue 10,592,668 18,673,967 76.3% Operating Expenses 12,380,196 20,832,444 68.3% Operating Profit -1,787 ,528 -2,158,477 20.8% Net Profit -1,368,887 -1,808,902 32.1%

Financial Review Financial Position FY17 FY18 CHANGE YIELD BY QUARTER (KWD) Operating Revenue 56,611,376 82,369,370 45.5% 61 53 54 50 49 47 49 45 Operating Expenses 48,899,086 75,587 ,000 54.6% 41 40 35 46 47 38 47 43 41 38 36 34 Operating Profit 7 ,712,290 6,782,370 -12.1% Net Profit 8,235,287 6,667 ,290 -19.0% 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 FY17 FY18 CHANGE PASSENGERS BY QUARTER (000) Cash 22,778,406 6,465,306 -71.6% 615 Fixed Assets 13,769,407 21,971,472 59.6% 490 448 381 381 349 478 Total Assets 56,213,150 62,866,145 11.8% 295 278 281 282 404 314 313 291 300 274 266 263 245 Total Liabilities 18,016,227 25,029,733 38.9% 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 Equity 38,196,923 37 ,836,412 -0.9% The Board of Directors recommended cash dividend of KWD7 million (FY17: KWD7 million), subject to shareholders’ approval at t he Company’s AGM.

Financial Review Fuel BRENT Swap Vs. SINGJET Swap (USD/BBL) BRENT Swap SINGJET Swap Fuel as Percent of Direct Cost

Balance Sheet Analysis FY18 Current Assets declined by ~KWD3 mn mainly due to: • dividend payout of KWD7 mn • Internal funding of the Terminal building construction of KWD10 mn • Increase in receivables of KWD11 mn mainly due to bunched up Engine shop visits in 4Q18 (shortage of spare parts from CFM delayed all Engines from MROs from 4Q17). This is a temporary increase until maintenance reserves/insurance claims are collected in 1Q/2Q19. Non-Current Assets increased by ~KWD10 mn primarily due to: • Terminal building becoming operational in 2018 • Security deposits paid to aircraft lessors for 2019 deliveries Trade Liabilities have increased by ~KWD7 mn due to: • Increased level of operations & the bunched up engine invoices in Q4, which will get cleared in 1Q/2Q19. Debt and Equity remained at the same levels as FY17 .