SAS — Earnings Release 2023

Sep 1, 2023

Q3 2023: A profitable quarter with the highest passenger figure since before the pandemic

Q3 2023: A profitable quarter with the highest passenger figure since before the pandemic

I am pleased to conclude a busy summer quarter. Almost 7 million passengers

traveled with SAS during the third quarter, the highest quarterly passenger

figure since before the pandemic. For the first time since 2019, we also posted

a quarterly profit. This is an important milestone. We still have a lot of work

ahead of us with our transformation to secure long-term competitiveness, but I

consider this a clear sign that we are on the right track and that our efforts

are paying off. We continue our ramp-up and will increase capacity this winter,

compared to the same period last year. We also noted strong ticket sales

throughout the third quarter, indicating a healthy underlying demand for travel

despite a more uncertain economic outlook in society as a whole.

During the quarter, air traffic control capacity issues caused considerable

problems for airlines, airports and, not the least, our passengers. We know that

many passengers traveling through Copenhagen Airport during the summer have been

impacted and our employees have been working hard to support those affected.

We are making progress in our Chapter 11 process in the US and in reaching our

overall targets in the SAS FORWARD plan. During the quarter, we started a

competitive and broad equity solicitation process to secure capital that will

help drive our airline forward and facilitate our emergence from the Chapter 11

process. There has been substantial interest from potential investors to

participate in the process, where potential investors can place bids to take a

lead position or be paired with other investors in acquiring equity interests of

the reorganized company.

MAY 2023-JULY 2023

· Revenue:  MSEK 13,173 (8,580)

· Income before tax, EBT: MSEK 457 (-1,991)

· Income before tax and items affecting comparability: MSEK 464 (-2,081)

· Net income for the period: MSEK 461 (-1,848)

· Earnings per common share: SEK 0.06 (-0.25)

NOVEMBER 2022-JULY 2023

· Revenue: MSEK 30,024 (21,173)

· Income before tax (EBT): MSEK -3,406 (-6,145)

· Income before tax and items affecting comparability: MSEK -3,548 (-6,315)

· Net income for the period: MSEK -3,773 (-5,810)

· Earnings per common share: SEK -0.52 (-0.80)

SIGNIFICANT EVENTS DURING THE QUARTER

· On May 10, the General Court of the Court of Justice of the European Union

announced its ruling regarding the recapitalization of SAS in 2020.

· On May 15, SAS received court approval for the company's equity solicitation

procedure.

· Skellefteå municipality joined the SAS Corporate Sustainability Program -

buying sustainable aviation fuel for all its business travel in 2023 and 2024.

· SAS currently aims to complete court approval of its court-supervised

process in the US around year-end, to be followed by any regulatory approvals

and procedures required in 2024. SAS currently expects that there will be only

modest recovery for general unsecured creditors and little or no recovery for

subordinated unsecured creditors upon emergence from the Chapter 11 process, and

that there will be no or very little value for existing shareholders in SAS AB

at the end of the company's restructuring proceedings.

OUTLOOK

· The third quarter interim report includes financial projections on page 10.

QUARTERLY RESULTS

SAS noted a continued positive trend for passenger demand through the third

quarter. The total number of passengers increased 36.8 percent, compared to the

same period last year which was impacted by the pilot strike. Year-on-year, our

RPK increased 42.5 percent, while capacity increased 35.9 percent. Our flown

load factor of 81.5 percent was up 3.7 percentage points on the same period last

year.

The increase in passenger demand and production led to a 54 percent increase in

our total operating revenue year-on-year, landing at SEK 13,173 million for the

quarter. Earnings before tax ended at SEK 457 million, representing an

improvement of SEK 2,448 million, compared to same period last year which was

impacted by the strike. The improved EBT reflects both stronger operational

performance and a financial effect related to currency revaluations of lease

liabilities.

Cost reductions across the business remain in focus to secure our cost

competitiveness. Total operating expenses for the quarter ended at SEK 11,596

million.

The cash balance at the end of the quarter was SEK 6,463 million. Cash flow from

operating activities during the quarter amounted to an inflow of SEK 1,542

million.

UPDATE ON SAS' TRANSFORMATION PLAN

We launched our comprehensive business transformation plan SAS FORWARD in

conjunction with the publication of the first quarter report for FY2022, in the

end of February 2022. The aim of the plan is to secure long-term competitiveness

for SAS in the global aviation industry. On July 5, 2022, to accelerate the

implementation of SAS FORWARD, we announced that we had voluntarily filed for

Chapter 11 in the US, a well-established and flexible legal framework for

restructuring businesses with operations in multiple jurisdictions. Through this

process, we aim to reach agreements with key stakeholders, restructure the

company's debt obligations, reconfigure our aircraft fleet and emerge with a

significant capital injection.

The procedures governing the equity solicitation process were approved by the US

court on May 15 and we are now running a competitive and broad solicitation

process to secure capital that will help drive our airline forward and

facilitate our emergence from the Chapter 11 process. There has been substantial

interest from potential investors to participate in the process, where potential

investors can place bids to take a lead position or be paired with other

investors in acquiring equity interests of the reorganized company.

Simultaneously, we continue to engage with our different stakeholders and work

toward building consensus for a reorganization plan. We currently aim to

complete court approval of our court-supervised process in the US around year

-end, to be followed by any regulatory approvals and procedures required in

NEW ROUTES AND DESTINATIONS

As part of SAS' strategy to strengthen our offering for Scandinavian travelers,

we have increased our capacity for the autumn and winter season. In May, we

announced two new direct intercontinental routes. We are bringing back a direct

route from Copenhagen to Bangkok, starting this autumn, and we are also

returning to Africa for the first time in decades, through weekly flights to

Agadir, Morocco, starting in November. SAS will fly to Agadir both from

Copenhagen and from Stockholm during the winter season until the end of March

2024, offering a convenient timetable with daytime departure and arrival.

STAR ALLIANCE NAMED WORLD'S BEST AIRLINE ALLIANCE

In June, Star Alliance won the title of World's Best Airline Alliance at the

prestigious Skytrax World Airline Awards once again. The Alliance's famed Los

Angeles lounge also won the World's Best Airline Alliance Lounge Award for the

seventh consecutive year. The Skytrax World Airline Awards are decided through

impartial international customer voting. This year, over 20 million eligible

entries were counted in a survey that ran from September 2022 to March 2023,

representing passengers with over 100 nationalities. The survey was also

provided in six major international languages. We are very proud to be part of

the Alliance, and winning the award again constitutes true proof of quality for

SAS and for the entire Star Alliance network.

STEPS TOWARDS FOSSIL-FREE AVIATION

SAS aims to decarbonize aviation and progress on this ambitious plan can only be

achieved through collaboration. By involving our customers and teaming up with

them, we can reduce CO\2\ emissions and enable increased large-scale production

of sustainable aviation fuels.

In June, Skellefteå Municipality became the first municipality in Sweden to join

SAS' Corporate Sustainability Program. The partnership entails that Skellefteå

will purchase sustainable aviation fuel for all its business travel flights for

its employees during 2023 and 2024. We hope that our new partnership will

inspire other companies and municipalities to reduce their air travel emissions

while contributing to driving the transition toward sustainable aviation.

In June, we opened seat reservations for our first-ever commercial electric

flight in Sweden, Norway, and Denmark. SAS has been one of the pioneers in the

airline industry since 1946, being for instance the first commercial airline

operator to fly over the North Pole to significantly shorten flight time between

continents. A groundbreaking activity for which SAS received the Columbus Prize.

We are proud to invite our passengers to the next major milestone in the future

of aviation, and it is a natural continuation of that pioneering spirit and a

significant step forward on our journey towards more sustainable aviation. We do

this to manifest our strong belief in the development of electric aviation as a

viable option to low- and zero-emission aviation.

LOOKING AHEAD

We are approaching the winter season and I am pleased by the positive trend in

our ticket sales throughout the third quarter. We continue our ramp-up and will

increase capacity this winter, compared to the same period last year.

We continue to make steady progress with SAS FORWARD and our Chapter 11 process

in the US. We are progressing with our equity solicitation process and we are

engaging with our different stakeholders to build consensus for a plan of

reorganization.

I want to thank my colleagues at SAS for their hard work to ensure that we take

the best possible care of our customers, and to ensure that they get the quality

service they expect from us. I am grateful for all your efforts!

As always, we look forward to welcoming our customers on board our aircraft.

Anko van der Werff

President and CEO

Stockholm, September 1, 2023

Teleconference - Q3 2023

A teleconference and webcast for investors, analysts and media will be held at

10.00 AM CEST. Anko van der Werff, President & CEO and Erno Hildén, Executive

Vice President & CFO, will present and comment on the report. The presentation

will be held in English.

Access via web link (no advance notification is

necessary): https://ir.financialhearings.com/sas-q3-2023

Link to register for participation via

telephone: https://conference.financialhearings.com/teleconference/?id=5006614

After registration you will be provided phone numbers and a conference/user ID

to access the conference. You can ask questions verbally via the teleconference.

For further information, please contact:

SAS press office, +46 8 797 29 44

Investor relations, +46 709 977 070

SAS, Scandinavia's leading airline, with main hubs in Copenhagen, Oslo and

Stockholm, is flying to destinations in Europe, USA and Asia. Spurred by a

Scandinavian heritage and sustainable values, SAS aims to be the global leader

in sustainable aviation. We will reduce total carbon emissions by 25 percent by

2025, by using more sustainable aviation fuel and our modern fleet with fuel

-efficient aircraft. In addition to flight operations, SAS offers ground

handling services, technical maintenance and air cargo services. SAS is a

founder member of the Star AllianceT, and together with its partner airlines

offers a wide network worldwide. Learn more at https://www.sasgroup.net

This is information that SAS AB is obliged to make public pursuant to the EU

Market Abuse Regulation. The information was submitted for publication, through

the agency of Erno Hildén, at 08:00 a.m. CEST on September 1, 2023.