Moscow, 31 October 2018 – PJSC Aeroflot (Moscow Exchange ticker: AFLT) announces the results of a Board of Directors meeting that took place on 31 October and was chaired by Mikhail Poluboyarinov.
The meeting was the first following the election of the new Board of Directors at the Extraordinary General Meeting of Shareholders held on 23 October 2018.
The work of the Board of Directors of PJSC Aeroflot was examined and its organisational procedure was determined. Members and chairpersons of the permanent committees of the Board of Directors were elected at the meeting. Vasily Sidorov (Independent Director) was elected chair of the Audit Committee; Igor Kamenskoi (Independent Director) was elected chair of Personnel and Remuneration Committee; Roman Pakhomov was elected chair of the Strategy Committee.
The following agenda items were also discussed during the meeting:
Forecast of Aeroflot Group passenger traffic in 2019. Given the economic performance of major global economies and Russia, Aeroflot Group plans to continue to grow at a strong pace. Key operating metrics, including Group PAX, are planned to increase at approximately the same rate as in 2018.
Investor Relations. Aeroflot’s share price has declined by 23% since the start of the year, broadly in line of the performance of global emerging markets. Global airline stocks are under pressure from higher fuel prices. Fuel costs are having an impact on Aeroflot’s share price, and the geopolitical environment is compounding this effect. On the other hand, Aeroflot’s financial results – both for the first quarter and second quarter of 2018 – have had a positive effect on the share price. Throughout the year the Company has continued to improve its disclosure practices, notably reporting IFRS financial results for the first quarter of the year for the first time ever, allowing investors to evaluate the Company on a quarterly basis.
PJSC Aeroflot’s incentive system. The list, weighting and scoring of key performance indicators (KPIs) under the Long-term Development Program for Aeroflot Group and the Aeroflot CEO for 2018 were approved. KPI scoring was revised based on revisions to the Group budget for 2018. Changes and additions to the Policy on PJSC Aeroflot’s Long-term Incentive Program were also approved.
Sponsorship. The 2019 sponsorship budget was approved as per both existing sponsorship agreements and expected future partnership programs. Sponsorship was approved of the CSKA professional soccer club and the CSKA professional basketball club for the 2019-2020 seasons, as well as the Russian Soccer Union for the 2018-2020 seasons. Sponsorships serve to strengthen Aeroflot’s reputation as premium airline dedicated to corporate social responsibility and supportive of sport and health living.
Charitable activities. The report on use of the charity budget for 2018 (as of 9 October 2018) was reviewed. The Board confirmed that expenditures fully comply with the Company’s Policy on Formation and Use of the Charitable Fund.
Implementation of Aeroflot Group’s Innovation Program. In accordance with a Russian Federation Government Directive, a benchmarking audit was conducted that compared a range of KPIs evaluating the technological development of Aeroflot versus leading international peer airlines. The results of the benchmarking exercise found that Aeroflot in most instances performs on par or above peer airlines in terms of technological (innovative) development. Aeroflot’s Management Board was tasked with implementing the Aeroflot Group Innovative Development Program as per the results of the benchmarking audit.