13 December 2018, Moscow. – PJSC Aeroflot (Moscow Exchange ticker: AFLT) announces the results of a meeting of the Board of Directors held on 13 December 2018. The meeting was chaired by Evgeny Ditrich.
The following agenda items were discussed during the meeting:
Implementation of Aeroflot Group's long-term development programme (LDP) and achievement of key performance indicators (KPIs) for 3Q 2018. Implementation of the Group's LDP for the reporting period was successful, with achieved KPI exceeding the targets. A number of measures have been implemented to achieve Aeroflot Group’s strategic development goals, including development of the route network, aircraft fleet and operational capacities, increasing labor productivity and reducing operating costs.
Updating the long-term development program of Aeroflot Group. Overall the provisions of the updated long-term development program of Aeroflot Group for the period 2019-2023 were approved. Taking into account the directives of the Government of the Russian Federation, changes were made based on the updated strategy of Aeroflot Group through 2023, information on the multi-brand platform, programs for the development of the route network, aircraft fleet, operational capacities, as well as other strategic programs and activities being updated.
Implementation of the marketing strategy of Aeroflot Group. Measures to implement initiatives as part of Aeroflot Group's marketing strategy were carried out in accordance with the plan for the period between October 1, 2017, and September 30, 2018, and were recognized as successful. Activities within the approved plan help the Group's airlines to achieve their targets and ensure the stable development of Aeroflot Group as a whole, confirming the expediency and effectiveness of the multi-brand marketing strategy. The approved action plans for the implementation of the current marketing strategy of Aeroflot Group for 2017-2021 define the main direction for further development of the Group's airlines, allowing them to maintain a leading position in the macro market of the Russian Federation and the CIS and to expand their presence in key global markets. In view of the approval of the updated strategy of Aeroflot Group, it was decided to update the marketing strategy of Aeroflot Group for the period through 2023. Particular attention will be paid to such factors as the active development of interregional transport throughout Russia and the increase in the number of modern aircraft manufactured in Russia. By 2026, the Group intends to increase the number of Superjet 100 and MC-21 aircraft in its total fleet to 200 units.
Aeroflot Group’s 2019 IFRS consolidated budget. The Board approved the outline of operational indicators of Aeroflot Group for 2019, Aeroflot Group’s 2019 IFRS consolidated budget and the investment program of PJSC Aeroflot and Aeroflot Group for 2019. Next year, growth is expected across all major KPIs, including passenger traffic. The Group plans to increase flight frequency on high-yield routes with significant transfer traffic potential, as well as launch flights in Russia within the framework of the development of transport between regional airports. The total number of aircraft in the Group should reach 370 by 2019.
PJSC Aeroflot’s motivation system. It was decided to approve the results of the KPI implementation of the long-term development program of Aeroflot Group/CEO of PJSC Aeroflot for Q3 2018. It is recognized that during this period these indicators were exceeded as a result of measures to improve the efficiency of the company.
Aeroflot Group’s risk management. Documents have been approved to ensure the effectiveness of the integrated risk management and internal control system within the Aeroflot Group.
Determination of LLC Pobeda Airline’s position in respect of major lease transactions (operating lease) for the new Boeing 737 MAX8 aircraft. LLC Pobeda Airline positively views the operating lease transactions for five Boeing 737 MAX8 (lessor company GECAS) and 15 Boeing 737 MAX8 (lessor company SMBC Aviation Capital Limited). Preliminary term of delivery for the first transaction should be between 01.11.2019 and 01.06.2020. For the second - between 01.11.2019 and 01.11.2021.