SAS — Earnings Release 2017

Nov 10, 2017

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

SAS traffic figures October 2017

• Scheduled traffic (RPK) decreased 3% and the capacity (ASK) was up 2%.
• The load factor decreased by 3.8 p.u. versus last year to 74.9%.
• Scheduled number of passengers amounted to 2.6 million in October.
• The preliminary currency adjusted yield and PASK increased 9% and 4% respectively in October 2017 vs. last year. The nominal yield and PASK increased 7% and 2% respectively in October 2017 vs. last year.

Market development and capacity outlook

After a robust development of the seasonal demand during the summer, demand has shifted back to more business purpose traveling. In line with previous months, SAS's overall load factor declined versus last year.

The competition remains very intensive. After a summer with modest capacity growth in Scandinavia, the market capacity growth is expected to accelerate during the autumn and winter 2017.

In fiscal year 2017/2018, SAS has an indicative plan to increase capacity (ASK) by around 1–3%, driven by longer European routes and the fact that the Airbus A320neo has more seats than the aircraft being replaced.

SAS scheduled traffic development in October

SAS increased its scheduled capacity in October by 2% and the traffic decreased by 3%, resulting in a load factor of 74.9%. This was 3.8 p.u. lower than last year. Last year's load factor was positively affected by SAS's successful 70 year anniversary campaign. The load factor this year is therefore more in line with previous years' load factors.

SAS's intercontinental capacity was reduced by 3.1% and the traffic decreased 7.8%. Going forward, the capacity on long haul routes will decrease slightly as one wet leased Boeing 737 has been phased out.

The traffic on SAS's European/Intrascandinavian routes increased by 0.3%. At the same time the capacity was increased 5.2%. The growth was driven by the leisure oriented routes in Europe.

On SAS's domestic routes, the capacity was increased by 4.3%, driven by higher capacity on Swedish and Danish domestic routes. The traffic increased by 0.4%. The above information is consistent with the indication

announced by SAS on 3 November.

Product and news update

• SAS raised SEK 1.3 bn in a Private Placement of 52.5 million new common shares.
• SAS commenced direct flights between Stockholm and Miami.
• SAS' winter program started, with new direct flights to for example Eilat, Madeira and Malaga.
• SAS has decided to increase the capacity by 25,000 seats between Stockholm/Copenhagen and Berlin during Nov 2017 and Mar 2018.

SAS scheduled traffic	Oct 17	Change	Nov-Oct 17	Change
ASK (Mill.)	4 355	2.0%	48 303	7.4%
RPK (Mill.)	3 262	-3.0%	36 360	8.5%
Passenger load factor	74.9%	-3.8 p u	75.3%	+0.7 p u
No. of passengers (Mill.)	2.602	-2.6%	28.625	3.2%

			Nov 16-Oct 17 vs. Nov
Geographical		Oct 17 vs. Oct 16		15-Oct 16
development, schedule	RPK	ASK	RPK	ASK
Intercontinental	-7.8%	-3.1%	10.8%	10.9%
Europe/Intrascandinavia	0.3%	5.2%	8.6%	6.4%
Domestic	0.4%	4.3%	3.2%	3.2%

SAS charter traffic	Oct 17	Change	Nov-Oct 17	Change
ASK (Mill.)	269	-12.5%	3 914	6.8%
RPK (Mill.)	255	-11.3%	3 718	8.3%
Passenger load factor	94.9%	+1.3 p u	95.0%	+1.3 p u
No. of passengers (Mill.)	0.089	-11.0%	1.373	8.0%

SAS total traffic	Oct 17	Change	Nov-Oct 17	Change
ASK (Mill.)	4 624	1.0%	52 217	7.4%
RPK (Mill.)	3 517	-3.6%	40 078	8.5%
Passenger load factor	76.1%	-3.7 p u	76.8%	+0.8 p u
No. of passengers (Mill.)	2.691	-2.9%	29.998	3.4%

	change	change
0.93	+7%	+9%
0.69	+2%	+4%
	2017

	October 2017
Punctuality (arrival 15 min)	83.3%
Regularity	98.5%

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)