airBaltic Successfully Completes Complex Year 2004

Airline airBaltic carried a total of 589,288 passengers in 2004 – 75% more than in 2003. Revenues reached EUR74,4 million (MLVL 51.6) in 2004, an increase of 54% over the amount in 2003. Despite the complicated situation and extraordinary costs, airBaltic is continuing to improve its financial results from operations in Riga, Latvia. Last year airBaltic successfully launched its expansion into Lithuania, opening 11 new routes and transporting 97,000 passengers. Start of operations from Vilnius hub in the first 6-month resulted in losses. That brings airline overall net result for 2004 to a EUR1.2 million (LVL 850,000) loss.

“The operational results for airBaltic in 2004 were great, given a significant increase in fuel prices, and the investments in our new hub in Vilnius. We also changed our fleet of aircraft, which produced extraordinary cost of EUR 2.86 million. Competition in the aviation market was much more significant last year in Latvia, but results exceeded our expectations. Opening the hub in Vilnius with direct flights to 11 destinations, after the first six months ended with a loss. However, already this year airBaltic forecasts a profit in Lithuania. Comparatively quickly, we have achieved a significant increase in our market share in Lithuania – up from 9.74% in 2004 to more than 20% in the first quarter of this year. We plan to expand our operations in the Lithuanian market even further in future,” says the airBaltic president, Bertolt Flick, in commenting on the airline’s financial results.

As reported earlier, airBaltic carried a total of 589,288 passengers in 2004 – an increase of 75% over the previous year. This can largely be attributed to the launch of nine new routes from Riga – to Dublin, London, Manchester, Milan, Oslo, Cologne, Stuttgart, St Petersburg and Geneva. The passenger numbers are also due in part to the opening of a new hub in Lithuania. Last year airBaltic gained 50.1% market share at the Riga airport and 9.74% in Vilnius. In 2004, airBaltic offered 16,205 flights – 57% more than in 2003. airBaltic had high flight punctuality level– 93.6% in 2004. This indicator is better than the average among regional carriers in Europe – just 86%.

Forecasting airBaltic developments in 2005, Flick said: “We significantly expanded our operations last year, and also in 2005, airBaltic will continue the substantial increase of the passenger numbers. In the first three months of the year, our passenger numbers were up by 95.3% over the figures in 2004. In the first quarter, we have launched two new routes, from Riga to Istanbul and Barcelona. In April, we’re going to launch non-stops to Munich and Paris. By the summer of this year, airBaltic plans to offer non-stop flights from Riga to the Latvian city of Liepaja, thus reinstating domestic flights for the first time since Latvia regained its independence. We’re planning another non-stop from Riga by the summer of this year. In Vilnius, we’re going to renew our flights to Helsinki, offering them twice a day. We’ve completed our optimisation of the airBaltic fleet. Since March, as passengers know, we have fazed out AVRO RJ 70 aircraft. This means that now we use just two aircraft types –Boeing 737 and Fokker 50. In the next few weeks we’re expecting delivery of our seventh Fokker 50 aircraft. This allows us to optimise the cost of aircraft maintenance and utilisation.”

airBaltic in brief:

AIR BALTIC CORPORATION (airBaltic) is a stock company which was established in 1995. Its main shareholders are the Latvian state, with 52.6% of shares, and SAS AB with 47.2% of shares. In 2004, airBaltic earned Ls 51.6 million in turnover, and it transported 589,288 passengers. At this time airBaltic offers direct flights from two of the capital cities in the Baltic States – Riga and Vilnius.

From Riga, airBaltic offers flights to Amsterdam, Barcelona, Berlin, Brussels, Dublin, Hamburg, Helsinki, Kiev, Copenhagen, Cologne, London, Manchester, Moscow, Milan, Minsk, Oslo, St Petersburg, Istanbul, Stockholm, Stuttgart, Tallinn, Vilnius, Vienna and Geneva. Beginning on April 27, it will begin flights to Munich, and from April 30 – to Paris. In May, airBaltic plans to launch its first domestic route in Latvia – between Riga and Liepaja.

From Vilnius, airBaltic offers direct flights to Berlin, Dublin, Hamburg, Helsinki, Copenhagen, London, Munich, Oslo, Riga, Tallinn and Vienna.

The airBaltic fleet currently consists of seven Boeing 737-500 and six Fokker 50 aircraft.

For more information:

Vija Dzerve, public relations manager
A/S Air Baltic Corporation
Riga International Airport
LV-1053 Riga, Latvia
Telephone +371-720-7726
E-mail vija.dzerve@airBaltic.lv