SAS — Earnings Release 2016

Aug 8, 2016

Scandinavian Airlines 195 87 Stockholm Telephone: +46 8-797 0000 Fax: +46 8-797 1515

SAS traffic figures July 2016

• Scheduled traffic (RPK) increased 10.4% and the capacity (ASK) was up 8.8%.
• The scheduled load factor improved by 1.2 p.u. versus last year to the highest load factor for a single month of 88.2%.
• SAS carried 2.5 million scheduled passengers in July.
• The preliminary currency adjusted yield was down 1% but the PASK was up 1% in July 2016. The nominal yield and PASK were down 4% and 3% in July 2016.

Market development

Demand for long haul traffic, European leisure routes and domestic routes continues to grow. In July, SAS transported a record number of passengers for a July month and had the highest load factor ever for a single month. At the same time, the overall Scandinavian market capacity has increased about 6-7% year to date. The intensified competition and lower jet fuel prices have put pressure on the yield that has declined more than anticipated in 2016.

SAS is increasing its intercontinental capacity by about 25% during fiscal year 2015/2016 through new routes and frequencies. Overall, this has resulted in a longer average stage length with subsequent effect on the yield/PASK and will contribute to an expected scheduled capacity growth of 10% during 2015/2016. Number of flights is at the same time expected to increase by about 1%.

SAS scheduled traffic development in July

SAS increased its scheduled capacity in July by 8.8% and the traffic grew 10.4%. The overall load factor increased by 1.2 p.u. to 88.2% during the month. The higher load factor was driven by improvements within all segments of SAS network with stongest improvements versus last year on domestic routes.

SAS intercontinental traffic increased 27.4% and the capacity was up 26.2% resulting in a higher passenger load factor than last year. A record of more than 185,000 passengers travelled on SAS intercontinental routes during the month, driven by the new routes to Hong Kong, Los Angeles and Boston as well as more frequencies on existing routes. The route between Stockholm and Los Angeles had most passengers of all long haul routes with up to single daily departures in July.

SAS Europe/Intrascandinavian routes grew by 2.3%. The growth was strong on leisure oriented routes where traffic grew by 8%. Despite a capacity reduction of 0.5% the domestic traffic was up by 4.9% following positive developments on Swedish and Norwegian routes.

Product and news update

• SAS celebrates 70 years as pioneers in the sky. 1 August 1946 was the starting point for SAS through the merger of the Danish, Norwegian and Swedish international airline operations.
• _____________________________________________________________________________________________________________ • SAS has teamed up with Samsung and developed a solution that gives travelers access to the SAS app and Smart Pass via Samsung's Gear S2 smart watch.

SAS scheduled traffic	July 16	Change	Nov-July 16	Change
ASK (Mill.)	4 312	8.8%	32 656	10.2%
RPK (Mill.)	3 802	10.4%	23 767	9.2%
Passenger load factor	88.2%	+1.2 p u	72.8%	-0.7 p u
No. of passengers (Mill.)	2.479	4.3%	19.946	2.8%
			Nov 15 - Jul 16 vs.
Geographical	Jul 16 vs Jul 15		Nov 14 - Jul 15
development. schedule	RPK	ASK	RPK	ASK
Intercontinental	27.4%	26.2%	24.1%	28.2%
Europe/Intrascandinavia	2.3%	2.0%	1.9%	3.0%
Domestic	4.9%	-0.5%	1.9%	0.9%
SAS charter traffic	July 16	Change	Nov-July 16	Change
ASK (Mill.)	716	20.8%	2 385	7.2%
RPK (Mill.)	687	19.0%	2 222	6.1%
Passenger load factor	95.9%	-1.4 p u	93.1%	-1.0 p u
No. of passengers (Mill.)	0.266	23.1%	0.808	9.5%
SAS total traffic
(schedule and charter)	July 16	Change	Nov-July 16	Change
ASK (Mill.)	5 028	10.4%	35 041	10.0%
RPK (Mill.)	4 489	11.6%	25 989	8.9%
Passenger load factor	89.3%	+1.0 p u	74.2%	-0.7 p u
No. of passengers (Mill.)	2.744	5.9%	20.754	3.0%

July 2016	Nominal change	FX adjusted change
0,77	-4%	-1%
0,68	-3%	+1%

	July 2016
Punctuality (arrival 15 min)	76.5%
Regularity	99.6%

SAS's definitions:

RPK – Revenue passenger kilometers ASK – Available passenger kilometers Load factor – RPK/ASK Yield – Passenger revenues/RPK (scheduled)

PASK – Passenger revenues/ASK (scheduled)

Björn Tibell, Head of Investor Relations +46 70 997 1437 or bjorn.tibell@sas.se

SAS AB discloses this information pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 11:00 CET on 8 August 2016.