CONTENTS

STATEMENT BY GENERAL DIRECTOR GENERAL INFORMATION MAIN EVENTS FINANCIAL RESULTS OPERATING RESULTS The world air transport market trends Russian air transportation market trends in 2009 Pulkovo airport indicators SERVICES Ground handling operations Aviation security VIP-services and general aviation INFRASTRUCTURE Airdrome Air terminals 2010 PRIORITIES DEVELOPMENT PROSPECTS RISK MANAGEMENT SOCIAL POLICY ENVIRONMENTAL PROTECTION MAIN PARTNERS SOVEX Pulkovo Cargo Terminal FSUE State Corporation for Air Traffic Support Rossiya In-Flight Catering Service Lenrianta ANNEXES Annex 1. Pulkovo Airport History Annex 2. Pulkovo Airport Passenger traffic by countries in 2009 Annex 3. List of airlines operating regular flights in Pulkovo Airport in 2009 Annex 4. Route Network (regular flights) Annex 5. Contacts 4 6 8 11 19 19 20 22 32 32 33 34 37 37 39 41 43 46 50 53 55 55 55 56 56 57 59 59 62 64 66 70

STATEMENT BY GENERAL DIRECTOR

STATEMENT BY GENERAL DIRECTOR

Dear colleagues and partners!
The year of 2009 can undoubtedly be considered a landmark year in the history of the Saint Petersburg airport. In spite of unstable economic conditions throughout the world, Russia remains an attractive place for investments into transport infrastructure, and Pulkovo Airport has proven its high investment potential and its status as one of the most promising airports in Russia as well as in Europe. Pulkovo airport has retained its second position in the volume of passenger traffic only giving in to Moscow airports. In 2009 Pulkovo handled about 7 mln passengers. Our revenue has increased to RUR 4.6 bln or by 4.42% compared to 2008 while our net profit has reached RUR 0.8 bln. In June 2009, we finalized the results of the international investment tender for the right to operate Pulkovo Airport and carry out its strategic development plan. In spite of a peaking world financial crisis at this time, the interest of potential investors did not subside during the whole period of the tender. At the final stage, the tender panel had to review three detailed bids. The tender was won by Northern Capital Gateway, LLC, comprised of the Russian banking group VTB, German airport operator Fraport and Greek investment company Copelouzos. In October 2009, a Public-Private Partnership (PPP) agreement was signed between the Administration of Saint Petersburg, Pulkovo Airport, JSC and Northern Capital Gateway, LLC. It came into effect in the end of April 2010. By the terms of this agreement the airport complex has been transferred under the management of the Partner for a 30-year period. During this time, considerable investments in airport reconstruction will be made and modern airport technologies will be introduced. Pulkovo Airport, JSC will perform the role of a public managing company that will control execution of all terms of the PPP agreement and if necessary will provide technical support to the investor. I am happy to say today with confidence that our long-term meticulous work has helped to open a new stage of Pulkovo Airport development. Large-scale reconstruction of the airport infrastructure and construction of a new passenger terminal will help us to reach our main goal the creation of an international air transport hub of European level, befitting the status of the air gate of Saint Petersburg Northern Capital of Russia. Sincerely Yours, Andrey Murov

GENERAL INFORMATION

GENERAL INFORMATION
SAINT PETERSBURG
One of the most popular European tourist centers. The region is attractive for investments: it accounts for 10% of all foreign investments into the Russian economy. Pulkovo Airport is the only airport in the city with a population of 4.7 mln people. Additional 8.4 mln people live in the catchment area of the airport.

PULKOVO AIRPORT
The airport has two separate runways, one of them is certified to III ICAO Category. The airport has two passenger terminals. It serves as an alternate airport for the Moscow airports.

AIRLINES AND ROUTE NETWORK

In 2009, 31 international airlines, 29 Russian airlines and 11 CIS airlines operated regular flights to Pulkovo Airport. The total number of regular destinations is 130.

PASSENGER TRAFFIC
In 2009 the airport handled over 6.7 mln passengers. On average, the airport handles 239 take-off and landing operations and 18 516 passengers per day.

MAIN EVENTS

MAIN EVENTS
JANUARY
The airport continued its technical upgrade program.

FEBRUARY
The charity program From Pulkovo to Children was started.

MARCH
Pulkovo Airport passed successfully a quality management system (QMS) inspection which validated the certificate of conformity of the company QMS to the international standard ISO 9001:2000.

APRIL
Region-Avia started regular flights on the route Kostomuksha Petrozavodsk Saint Petersburg. Lufthansa opened a new daily flight between Saint Petersburg and Dusseldorf. Malev started regular flights between Budapest and Saint Petersburg. At the end of the month, Nouvelle Air started operating flights between Saint Petersburg and Monastir.

MAY
On-line ticket booking service through the airport web-site was introduced. Air Berlin started operating flights between Saint Petersburg and Dusseldorf.

JUNE The International tender that was announced by the Administration of Saint Petersburg on 21 April 2008 for the right to conclude an agreement on the creation, reconstruction and operation of Pulkovo Airport facilities on the basis of a Private-Public Partnership had been completed. The tender was won by Northern Capital Gateway, LLC established by the Russian banking group VTB, German airport operator Fraport AG and Greek investment company Copelouzos Group. Pulkovo Airport participated in the XIII International Economic Forum and World Grain Forum. Over 1 700 flights were handled during the 5 days of these events. A new comfortable waiting lounge and a renovated mother-and-child room were opened in Pulkovo 1 Terminal. Region-Avia extended Pulkovo Airport regular flight network with a new destination Kursk . Mordovia Airlines resumed flights from Saint Petersburg to Saransk. Vueling (Clickair) started flights between Barcelona and Saint Petersburg. Pulkovo Airport celebrated its 77-year anniversary.

MAIN EVENTS
JULY
Pulkovo Airport and Booking.com BV company launched a new hotel booking service through the web-site www.pulkovoairport.ru. Estonian Air started operating regular flights along the route Tallinn Saint Petersburg Tallinn.

AUGUST New passenger service technologies were introduced in Pulkovo 1Terminal. Thanks to this new complex of technological and infrastructure innovations, passengers can now take advantage of a combined flight check-in, advance check-in, check-in for the passengers without luggage, terminal information services, etc.

SEPTEMBER
Transaero launched a program of charter flights to Egypt on Boeing 747 aircraft. Pulkovo Airport became one of the few Russian airports capable of servicing two and more aircrafts of this type simultaneously.

OCTOBER
Trilateral agreement on the creation, reconstruction and operation of Pulkovo airport facilities on the basis of a Public-Private Partnership was signed by the Administration of Saint Petersburg, Pulkovo Airport, JSC and Northern Capital Gateway, LLC. Pulkovo Airport in cooperation with the Hertz company launched an on-line car booking service through its web-site. Transaero started operating regular flights between Saint Petersburg and Phuket.

NOVEMBER
Region-Avia started flights between Saint Petersburg and Nizhniy Novgorod.

DECEMBER
Runway N1 was set in operation after the completion of its reconstruction . A new free of charge Wi-Fi Internet network was set up for the operation. The airport was equipped with smoking rooms.

FINANCIAL RESULTS

FINANCIAL RESULTS
In 2009, operating revenue of Pulkovo Airport, JSC reached RUR 4 619 mln which represents a 4.42% growth compared to the year of 2008. Operating costs have increased by 9.06% compared to the previous year and reached RUR 3 537 mln. Financial result totaling RUR 1 081 mln showed a 8.33% decrease compared to 2008.
Table 1. Pulkovo Airport financial indicators in 2009
2009, mln. RUR 4 619 3 849 770 3 537 1 081 2008, mln. RUR 4 423 3 648 775 3 244 1 180 2009/ 2008 % 104,42 105,50 99,31 109,06 91,67

Operating revenue, including: Aviation revenue

Non-aviation revenue

Operating expenses Operating revenue financial result

Operating revenue Operating expenses Operating revenue financial result Figure1. Dynamics of economic indicators during 2009 (thousand RUR.)

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FINANCIAL RESULTS
Table 2. Operating revenue
2009/2008 2009, mln. RUR 2008, mln. RUR mln. RUR 195 201 102 157 -58 -5 84 -17 -9 -7 -1,5 -76 4 % 4,42 5,50 5,21 11,94 -15,83 -0,69 29,83 -9,06 -16,93 -13,59 -1,77 -26,98 19,19

Operating revenue, including: Aviation revenue, including:

4 619 3 849 2 069 1 469 311 770 368 172 44 42 86 207 23

4 423 3 648 1 967 1 312 369 775 283 189 53 49 87 283 19

Airport charges

Ground handling Other core-aeronautical activity Non-aviation revenue, including: Space rental Utilities, including Power supply Water supply Heat supply Services Advertising

In 2009, the aviation revenue of Pulkovo Airport, JSC reached RUR 3 849 mln which represents a 5.5% growth compared to the year of 2008. In spite of a complicated economic situation throughout the world in 2009 the Airport was able to attract new carriers and extend its route network. Seven new airlines started operating regular flights to Saint Petersburg. Four airlines resumed their flights. Six new destinations were opened while the number of flights to the existing destinations was increased. The structure of the aviation revenue has not changed significantly compared to 2008.

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FINANCIAL RESULTS

Table 3. Aviation revenue, 2009

%
Core aeronautical activity including:

2009, mln. RUR 3 538

92%

Take-off and landing

18% 1% 11% 4% 20% 6% 16% 5% 10% 8% 100%

697 22 419 160 771 246 618 204 401 311 3 849

Extra time parking Aviation security Terminal use for domestic flights Terminal use for international flights Passenger handling on domestic flights Passenger handling on international flights Other aircraft handling revenues Ramp handling Other core-aeronautical activity Total

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FINANCIAL RESULTS

Terminal use for international flights 20,0% Extra time parking 1,0% Terminal use for domestic flights 4,0% Other aircraft handling revenues 5,0% Take-off and landing 18,0%

Passenger handling on domestic flights 6,0%

Other core-aeronautical activity 8,0%

Passenger handling on international flights 16,0%

Ramp handling 10,0% Aviation security 11,0%

Aviation revenue structure in 2009

The non-aviation revenue reached RUR 770 mln. Keeping the revenue at the level of 2008 was possible due to the increase of revenue from the rent of space and advertising sales. As to the decline related to other parts of revenue, they resulted from the fact that during 2009 the airport was transferring its non-core assets to the balance of the city (for example, a boiler house located in Aviagorodok and many others) thus, their operating revenue was transferred to the city budget. The structure of the non-aviation revenue has changed significantly compared to 2008. A share of space rent revenue increased from 37% to 48%. The shares of utilities and services revenue decreased pro rata from 24% to 22% and 36% to 27% correspondingly.

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FINANCIAL RESULTS
Table 4. Non-aviation revenue, 2009
%
Space rental

2009, mln. RUR 368 172 207 23 770

48% 22% 27% 3% 100%

Utilities Services Advertising Total

Space rental 48,0%

Advertising 3,0%

Services 27,0%

Utilities 22,0%

Non-aviation revenue structure in 2009

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FINANCIAL RESULTS
Operating costs increased by 9.06% compared to 2008. A significant growth of labor compensation costs of 15% was observed. The costs related to the amortization of the fixed assets demonstrated the highest growth because the airport continued to implement the technical upgrade plan. In 2008, a large number of vehicles as well as new equipment for servicing the airfield and aircrafts were placed on the companys balance sheet.

Table 5. Operating expenses in 2009

2009/2008 2009, mln. RUR 2008, mln. RUR mln. RUR 294 223 37 -35 84 15 -44 -53 7 60 % 9,06 15,00 11,46 -11,63 38,94 8,36 -31,44 -97,71 7,31 13,37

Total, including

3 537 1 707 359 266 301 190 96 1 107 509

3 244 1 484 322 303 217 175 139 54 100 449

Payrolls

Social payments Material expenses Amortization Water and power supply Capital repair Lease payments Insurance Other

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FINANCIAL RESULTS
The major repairs costs decreased significantly due to the transfer of non-core assets such as the bathhouse and the hostel to the balance of the federal authority. Leasing payments also decreased significantly because for several years the airport had not been using leasing schemes for equipment procurement. The structure of the companys costs has not changed significantly compared to 2008.

Payrolls 48,3%

Lease payments 0,04%

Capital repair 2,7%

Insurance 3,0%

Water and power supply 5,4%

Other 14,4%

Material expenses 7,6% Social payments 10,2%

Amortization 8,5%

Operating expenses structure in 2009

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OPERATING RESULTS

OPERATING RESULTS
The world air transport market trends
According to International Civil Aviation Organization (ICAO) estimates (as of December 2009), the demand for air transportation during the whole 2009-year period was very low. Thus, in spite of a sharp decrease of average prices for aviation fuel in 2009 (40.2% decrease compared to 2008) the world passenger turnover decreased by 4.1% compared to the previous year while there was 1.3% growth in 2008 and there was a forecasted 4.5% growth for 2010. The passenger load factor was only 61.9% which is 1.6% lower compared to the previous year and 0.4% lower compared to the passenger load factor forecast for 2010. The losses reached $ 11 bln compared to the forecasted $ 5.6 bln. As to regional results a decrease of demand for passenger air transportation in the Asian-Pacific region, Europe and North America reached 5.6%, 5.0% and 5.6% correspondingly in 2009. The Middle Eastern airlines were able to achieve the most significant growth of passenger transportation by the end of the year 11.2%. According to the experts the key reasons of the reduction of passenger traffic and air transportation revenue are the impact of the world financial crisis and the swine flus spread. According to ICAO 2.28 bln people will use air transportation in 2010 which is comparable to the peak reached in 2007.
Table 6. World aviation industry revenue in 2007-2008 and forecast for 2009-2010

Region

2007

2008

2009 (forecast)

2010 (forecast)

World

12,9 5,3 5,4 2,1 -0,1 0,1 0,1

-16,8 -9,5 0,2 -5,5 -1,0 -0,7 -0,3

-11,0 -2,9 -3,5 -3,4 -1,2 0,1 -0,1

-5,6 -2,0 -2,5 -0,7 -0,3 0,1 -0,1

North America Europe Asia and Oceania Middle East Latin America Africa

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OPERATING RESULTS
Fuel price per barrel, 2001 2010

Source: IATA Economics E estimate data. F forecast data. Figure 5. Jet fuel price per barrel

Russian air transportation market trends in 2009

In 2009, Russian airlines transported 45.1 mln passengers, 9.4% less compared to the previous year. In spite of a decreased demand for air transportation resulting in the excess of transportation capacities the passenger load factor was increased by 0.3% to 74.3%.

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OPERATING RESULTS
The passenger traffic of most airlines has stabilized by the end of the year. However, the largest Russian airlines taking 55.1% share in total Russian air transportation market managed this difficult situation in different ways. UTair and Transaero increased their passenger traffics by 9.3% and 3.6% correspondingly while Aeroflot airline, S7 (including the passenger traffic of its subsidiary Globus Airline) and Rossiya reduced their passenger traffics by 5.6%, 13.2% and 16.4% correspondingly.
Table 7. Top 5 domestic airlines operation indicators in 2008-2009

Airline

Passenger carried, pax. January - December % from previous year 94,4 103,6 77,7 84,6 109,3 92,9

Load-factor, % January - December

2008 2009 70,9 82,6 79,1 73,5 70,4 69,5 81,5 76,3 71,5 73,1 -1,4 -1,1 -2,8 -2,0 2,7 -

2008

2009

1 2 3 4 5 Total

Aeroflot Transaero S7 Rossiya UTair

9 271 433 4 852 887 5 892 548 3 514 319 3 225 081 26 756 268

8 755 471 5 025 862 4 576 769 2 971 759 3 526 469 24 856 330

Share of top 5 airlines in Civil Aviation passenger traffic , % Total Civil Aviation traffic, pax

53,7

55,1

49 804 579

45 107 857

90,6

74,0

74,3

0,3

Source: Federal Air Transport Agency

In 2009, several Russian airlines stopped their operations. Along with small airlines some large carriers such as Interavia and KD avia bankrupted. Federal Air Transport Agency forecasts that some airlines will not be able to cope with their obligations in 2010. In spite of that fact, according to Victor Khristenko, the Minister of Industry and Trade of the RF, Russia is still planning to take 5% of the world civil aviation market by 2015 and 15% by 2025. Another important event of 2009 was the decision to liquidate Aviacompany, JSC (previously named as Rosavia) that had been established by the government of Moscow city and Rostechnology State Corporation. Initially this carrier should consist of 7 airlines including Atlant-Soyuz, Rossiya, Orenburg Airlines, Vladivostok Avia, Sakhalin Air Routes and Saratov Airlines. However, in 2009, was made a decision to incorporate the aviation assets of the Rostechnology State Corporation and transfer them to Aeroflot Russian Airlines.

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OPERATING RESULTS
Pulkovo airport indicators
Pulkovo Airport has a stable position in the sector being one of the biggest Russian airports. According to the results of 2009 the airport retains its fourth rank in passenger traffic only giving in to Moscow airports Domodedovo, Sheremetyevo and Vnukovo. In 2009, the passenger traffic of Pulkovo Airport reached 6 758 352 passengers.
Table 8. Dynamics of passenger traffic in 2002-2009, mln. pax
Region Domestic destinations International destinations CIS destinations Total 2002 1,6 1,4 0,1 3,2 2003 1,9 1,7 0,2 3,8 2004 2,1 2,0 0,3 4,3 2005 2,2 2,2 0,3 4,7 2006 2,4 2,3 0,4 5,1 2007 2,9 2,8 0,5 6,1 2008 3,3 3,2 0,6 7,1 2009 3,3 2,9 0,5 6,7

The total passenger traffic of Pulkovo Airport decreased by 4.4% compared to 2008, which corresponds to the world trend and demonstrates positive dynamics in comparison with the average indicators in the RF.
Table 9. Main operational indicators in 2009
Unit of measurment 2009

Growth/ decline rate

-4,4%

Passenger traffic

People

6 758 352

International CIS Domestic Take-off and landing operational International CIS Domestic MTOW Cargo Mail

People People People Operations Operations Operations Operations Thousand tons Tons Tons

2 933 498 551 373 3 273 481 87 594 35 477 5 839 46 278 3 069 16 864 2 600

-9,5% -2,8% 0,4% -6,9% -0,8% -8,9% -6,0% -9,0% -10,9% -30,1%

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OPERATING RESULTS
The reduction of passenger traffic to foreign destinations reached 9.5% and to CIS destinations 2.8%. This negative trend was partially compensated by positive dynamics in the RF segment, that showed 0.4% growth compared to 2008. The total number of take-off and landing operations was 87 594 in 2009. The average passenger load factor was 64.3% while the same average indicators in Russia remained at the same level as in 2008 (61.2%), a small decrease was observed for foreign and CIS destinations. According to the results of 2009, 73 691 regular flights, 7 750 charter flights and 6 153 business aviation flights were operated through Pulkovo Airport. The structure of air transportation by the types of regularity was the following: 84% of regular flights, 9% of charter flights and 7% of general aviation flights.
Table 10. Main operational indicators by traffic type, 2009
Unit of measurement

Indicator

2009

2009/2008

Take-off and landing operational

Operations

87 594

-6,9%

Regular Charter General aviation Passenger traffic Regular Charter General aviation

Operations Operations Operations People People People People

73 691 7 750 6 153 6 758 352 6 194 539 526 394 37 419

-4,5% -16,1% -19,5% -4,4% -4,5% -2,4% -15,4%

In 2009, three airlines Kogalymavia (Surgut), Mirninskoye Air Enterprise (Mirniy) and KD avia (Kaliningrad) stopped operating their flights to Pulkovo Airport. However, the airport continued to attract new regular airlines. Seven new airlines started operating flights to Saint Petersburg, including: foreign airlines such as Malev (Budapest), Vueling (Clickair) (Barcelona), Nouvelle Air (Monastir) and Estonian Air (Tallinn); Domestic airlines such as Region-Avia (Kostomuksha, Kursk, Nizhniy Novgorod); CIS airlines such as Somon Air (Dushanbe), Turkmenistan Airlines (Ashkhabad). Four airlines such as Mordovia Airlines (Saransk), Dagestan Airlines (Makhachkala), Air Kyrgyzstan (Bishkek) and SCAT (Almaty) resumed their flights.

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OPERATING RESULTS
Six new destinations were launched including: Phuket (Transaero), Tallinn (Estonian Air), Kostomuksha and Kursk (Region-Avia), Magadan (Yakutia Airline) and Ashgabat (Turkmenistan Airlines). The following flights were resumed: Makhachkala (Dagestan Airline), Nizhniy Novgorod (Region-Avia), Saransk (Mordovia Airlines). Operating carriers opened the following destinations: Kaliningrad (Aeroflot), Anapa (Kuban Airlines), Moscow and Gyanja (Ural Airlines), Rimini and Catania (Rossiya), Anapa, Kaliningrad and Murmansk (UTair), Phuket (Transaero), and Dusseldorf (Lufthansa and Air Berlin).
Table 11. New airlines and destinations
New airlines Airlines

Destination
Budapest

Frequency per week 2 1 1 3 3 2 2 1 1

Malev

Vueling (Clickair) Nouvelle Air Estonian Air

Barcelona Monastir Tallinn Kostomuksha Kursk Nizhni Novgorod Dushanbe Ashgabat

Region-Avia

Somon Air Turkmenistan Airlines

New destinations (except Kostomuksha, Kursk, Tallinn, Ashhabad)

Destination Phuket Magadan

Airlines
Transaero Yakutia

Frequency per week

2 1

In 2009 we keep on the activity with operating airlines targeting on Pulkovo route network extension and stimulation of the carriers to increase the flight numbers to underserved destinations. The most dynamically developing regular destinations based on the results of 2009 include: International destinations: Dusseldorf (+110.7%), Antalya (+79.4%), Nice (+56.4%), Tel-Aviv (+52.9%), Dubai (+48.9%) and Goa (+40.8%); Domestic destinations: Irkutsk (+95.6%), Yuzhno-Sakhalinsk (66.5%), Anapa (+54.2%), Barnaul (+35.9%); CIS destinations: Gyanja (+264.3%), Chisinau (+23.1%) and Minsk (+22.8%).

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OPERATING RESULTS
In 2009 the biggest absolute growth of passenger traffic was observed on charter flights on the following tourist routes: Sharm-el-Sheikh, Hurghada, Zakintos, Rhodes, Ovda, Malaga, Colombo, Phuket, Larnaca. The growth on the most of the abovelisted destinations became possible due to significant increase of the number of flights by Rossiya, as well as new flights to Hurghada and Sharm-el-Sheikh by Ural Airlines,

Transaero, Orenburg Airlines and S7. In comparison with 2008 the following new charter flights were introduced: Kos (Rossiya, Transaero), Nantes (Rossiya, Axis Airways, Blue Line), Taba (Rossiya).
able 12. Top 10 airlines by passenger traffic in 2009 (regular and charter)
Airlines Rossiya Aeroflot Lufthansa S7 UTair Nordavia Transaero Air Berlin Sky Express Uzbekistan Airlines Passengers carried in 2009 2870788 593908 361809 234862 216817 137340

Growth/decline rate -9,5% 21,5% -3,6% -0,1% 11,0% -2,9% -24,9%

44,0% -13,0% -11,3%

132702
126605 124779 117304

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OPERATING RESULTS

Rossiya 42,5%

Uzbekistan Airlines 1,7% Sky Express 1,8% Air Berlin 1,9% Transaero 2,0% Nordavia 2,0% UTair 3,2% S7 3,5% Lufthansa 5,4% Aeroflot 8,8% Other 27,2%

Share of top 10 airlines in Pulkovo total passenger traffic in 2009

Rossiya carries about 42.5% of the total passenger traffic and is the flag carrier of Pulkovo Airport. According to the results of 2009 the company carried 2 689 037 passengers on regular flights or 42.8% of the total regular passenger traffic of Pulkovo Airport and 181 751 passengers on charter flights or 39.2% of the total charter passenger traffic of Pulkovo Airport. In 2009 the total number of passengers decreased by 9.5% compared to the previous year which was caused mostly by the reduction of the charter flights by 59.5% to the following tourist destinations: Sharm-el-Sheikh

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OPERATING RESULTS
(-54.4%), Hurghada (-52.2%), Pula (-45.9%), Bodrum (-39.5%), Dalaman (-39.4%). In addition, such previously popular charter destinations as Dubai, Izmir, Oslo, Monastir and Faro were closed. At the same time flights to Catania and Rimini were introduced. The highest growth of passenger traffic (in absolute and percentage terms) was observed on the following regular destinations: Antalya, Kaliningrad, Tel-Aviv, Arkhangelsk, Samara, Sochi, Irkutsk, and Burgas. At the same time the following destinations became less popular: Sharm-el-Sheikh, Hurghada, Monastir, Paris, Thessaloniki, Norilsk, Beijing, London, Ekaterinburg, Tivat, Copenhagen, Krasnodar, Budapest, Barcelona, Varna and Dusseldorf. Aeroflot increased the passenger traffic on its regular flights by 21.5%. After the bankruptcy of KD avia, Aeroflot started regular flights from Saint Petersburg to Kaliningrad which together with the 19.1% higher passenger traffic to Moscow allowed this carrier, for the third year in a row, to rank second in volume of passengers carried on regular flights through Pulkovo Airport. The passenger traffic of Lufthansa to Munich and Frankfurt am Main decreased by 0.9% on average. The introduction of a new regular destination to Dusseldorf helped to slow the reduction of the companys passenger traffic. The number of passengers carried on regular flights by UTair increased by 11.1%. In spite of the fact that the airline stopped operating flights to several destinations (such as Arkhangelsk, Ekaterinburg, Kazan, Ufa) the following destinations were added to its flight network from Saint Petersburg: Anapa, Kaliningrad, and Murmansk. In addition, the passenger traffic increased on destinations to Moscow (+32.8%) and Syktyvkar (+11.9%).
Table 13. Low-cost airlines in Pulkovo Airport
Growth/decline rate (2009/2008)

Airlines

Passengers carried in 2009

Air Berlin

126 605

45,90% -11,90% 16,20% 46,90% -32,00% -61,40% New carrier 2,72%

Sky Express Air Baltic Wind Jet Norwegian Air Shuttle Germanwings Vueling (Clickair) Total

124 398 42 202 29 078 17 606 14 411 2 493

356 793

27

OPERATING RESULTS

Vueling (Clickair) 0,7% Germanwings 4,0% Norwegian Air Shuttle 4,9%

Air Berlin 35,5%

Wind Jet 8,1%

Air Baltic 11,8%

Sky Express 34,9%

Distribution of low-cost airlines traffic in Pulkovo Airport in 2009

Under the crisis conditions many low-cost carriers developed significantly their operation from Saint Petersburg, successfully adapting to the new economic situation. As a result, the distribution of low-cost airline position in Pulkovo Airport has changed significantly. First place went to Air Berlin, that started a regular flight to Dusseldorf on May 1, 2009. Wind Jet stopped operating flights to Palermo and at the same time opened a much more popular destination Forli which resulted in 46.9% increase of the total passenger traffic. Air Baltic increased the number of flights to Riga and offered convenient and economical connecting flights to Europe through Riga which resulted in a 16.2% increase of passenger traffic to that destination. The year of 2009 was a critical time for some airlines. Sky Express reduced the number of flights to Moscow by 22.5% which resulted in 11.9% decrease of the passenger traffic of that airline. Oslo became a less demanded destination which affected the passenger traffic of Norwegian Air Shuttle. Germanwings stopped operating flights to Berlin.

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OPERATING RESULTS
Top domestic, CIS and international destinations
Table 14. Top 10 Domestic Destination by passenger traffic in 2009 (regular flights)
Destination Passengers carried in 2009

Growth/decline rate (2009/2008) 8,8% -10,8% 19,0% 35,5% 0,2% -34,0% -6,7% -8,4%
-31,3% 7,5%

Moscow

1 919 327

Kaliningrad Sochi Arkhangelsk Murmansk Ekaterinburg Novosibirsk Samara Krasnodar Rostov-na-Dony

176 905 101 025 93 825 89 970 86 810 81 287

52 171
46 433 46 150

By the first time Rostov-on-Don joined the list of main Russian destinations due to Rossiya and Donavia (till 25.09.2009 named Aeroflot-Don) airlines that started regular flights on this destination in 2009.
Table 15. Top 10 CIS Destination by passenger traffic in 2009 (regular flights)
Destination Passengers carried in 2009

Growth/decline rate (2009/2008) -10,8% 11,3% -5,6% -13,2% -16,9% -5,9% -15,9% 23,1%
2,0% -4,8%

Tashkent

74 294

Dushanbe Samarkand Kiev Baku Almaty Erevan Chisinau Fergana Simferopol

61 458 56 444 53 926 36 492 31 418 28 664

23 843
18 851 18 784

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OPERATING RESULTS
Fergana was included in the top 10 key CIS destinations for the first time in 2009. Regular flights to this destination have been operated by Rossiya (from 2008) and Uzbekistan Airlines (from 2006).
Table 16. Top 10 International Destination by passenger traffic in 2009 (regular flights)
Destination Passengers carried in 2009

Growth/decline rate (2009/2008) -8,5% 79,4% -15,7% -6,7% -0,9% -8,4% -13,5% 110,7%
52,9% 39,9%

Frankfurt am Main

254 580

Antalya Paris Munich Helsinki Berlin London Dusseldorf Tel-Aviv Zurich

155 081 154 773 152 242 122 597 103 029 90 471

89 900
89 618 79 090

In 2009 Tel-Aviv and Zurich firstly became among the top 10 foreign destinations. Prior to 2007 the flights along the destination of Saint Petersburg Zurich Saint Petersburg were operated by Rossiya. From 2008 flights between Saint Petersburg and Zurich have being carried by Swiss Airlines.

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SERVICES

SERVICES
Ground handling operations
In 2006 Pulkovo Airport formed its own aviation ground handling service department. Now this department provides service for regular flights of 31 foreign airlines, 9 CIS airlines, Transaero and Aeroflot-RA as well as charter flights and all general aviation flights in Pulkovo Airport. The ground handling service department operates from 35 to 50 planes per day depending on the current timetable and the number of general aviation flights. Pulkovo Airport provides the following services to airlines: support of arriving/ departing aircraft, towing, provision of power supply units, interior cabin cleaning, aircraft de-icing, engine starting, aircraft lavatory cleaning and water supply system maintenance, cabin heating, provision of ground equipment (ladders, chocks), and other services. In 2009, the fleet of special machines and special ground equipment was widened significantly in Pulkovo. Events of 2009 To improve the quality of the aircfafts de-icing services and to provide a continuous supply of de-icing liquids, the Airport purchased specialized equipment and created a certified facility for the acceptance, storage and delivery of de-icing liquids, as well as a certified laboratory for the quality analysis of de-icing liquids. Necessary machinery and specialized ground equipment for servicing aircraft were purchased for the ground handling service department throughout 2009. Training of technicians and engineers is being continued.

In 2010 the list of ground technical services for aircraft are planned to be expanded, necessary equipment to be purchased, and the professional training of personnel in the leading airlines training centers and also through Pulkovo own training programs to be realized.

32

SERVICES
Aviation security
The key direction of the aviation security policy of Pulkovo Airport is to protect the lives and health of passengers, aircraft crews and airport staff by keeping high international standards and Russian regulations requirements in the aviation field. The aviation security program, emergency regulation plan and information security policy had been developed and have being realized to protect against any illegal intrusion in Pulkovo Airport. All aircraft, crew, staff, passengers, luggage, including hand luggage, mail, cargo, on board supply and in-flight catering are carefully inspected. Aviation security and access control are organized in special zones. In addition, the Airport provides security protection for aircrafts, air traffic control facilities, equipments, warehouses, checkpoints and other facilities located on the territory of the airfield. All personnel of Pulkovo Airport, JSC attend basic aviation security training. Those staff that engaged with providing of aviation security has licenses and certificates of the leading specialized training centers. In 2009 488 employees of the aviation security department were trained and certified in the training centers of additional professional education in Moscow and Saint Petersburg. On a monthly basis Pulkovo Airport specialists together with the Line Department of Internal Affairs employees attend trainings on aviation security measures violations as well as response actions in case of the detection of weapons, ammunition, explosives, etc. Pulkovo Airport aviation security department cooperates with the employees of Pulkovo Airport Check Point, Pulkovo Customs, Extra-Departmental Protection Directorate under Central Internal Affairs Directorate for the city of Saint Petersburg and the Leningrad region, Line Department of Internal Affairs of Pulkovo Airport, as well as the civil aviation department of the Federal Security Service Directorate for the city of Saint Petersburg and the Leningrad region.

33

SERVICES
Events of 2009 Aviation security conformance certificate was extended. Check Point 9 reconstruction was completed, preflight check point intended for international air lines crews and airport personnel was equipped. New preflight check point for in-flight catering and in-flight supplies was organized and put in operation. Work of experts on psychological testing (profiling) intended for revealing potentially dangerous passengers at various stages of passenger flow processing was organized including with the help of biometrical video control system. New search-inspection equipment was purchased and put in operation. Alarm system optimization was carried out. As a result of the aviation security department activities in 2009 1602 passengers carrying restricted objects were identified. 286 units of weapon and ammunition, explosive and poisoning substances, as well as pyrotechnics were detected and confiscated. 663 different violations of access control and internal security measures were prevented.

In 2010 aviation security plan is to continue improving the technical equipment and the airport infrastructure, carrying out further training for personnel and advanced training for aviation security specialists.

VIP-services and general aviation

Pulkovo Airport provides fast-track services for VIP passengers. There are 4 business lounges (2 in each terminal), 2 VIP lounges (1 in each terminal), and 2 lounges for representatives of official establishment and delegations (in Pulkovo 1 Terminal). VIP and business lounges offer their guests to spend time in comfortable area provided different services like telephone and fax communication, free Wi-Fi hot spots, newspapers and magazines in Russian and foreign languages, drinks and snacks. The holders of Priority Pass, Citi Gold and Diners Club International cards are serviced in these business lounges as well. The services for VIP passengers in Pulkovo airport are provided by Pulkovo VIP International, LLC and Pulkovo Passenger Services, CJSC. Pulkovo Airport serves business aviation flights and unscheduled flights. JetPort SPb is a company that has been providing those services in Pulkovo airport since October 2009. JetPort SPb supports ground handling operations for flights of both Russian and foreign airlines. The services provided to business aviation flights include the following: organization of servicing passengers in the sector of business aviation, VIP lounges and business lounges of Pulkovo 1 and Pulkovo 2 terminal buildings; assistance with customs control, passport control and other formalities; organization of in-flight catering;

34

SERVICES
transportation of passengers/crew to/from the airplane; transportation of passengers/crew in the city; hotel booking and accommodation of passengers/crews; visa support for crews; fueling and many other services. From 16 October 2009 through 31 December 2009 JetPort SPb organized services for 1228 flights of foreign airlines and 98 flights of Russian airlines (including business aviation flights, lettered, tourist, charter, medical, cargo and other flights) in Pulkovo Airport. Starting from January 1, 2010, the company provided services to passengers on the basis of the certificate for provision of services in Pulkovo Airport for passengers and luggage on domestic and international flights. Events of 2009 Renovation of the VIP-lounge and official delegation lounge in Pulkovo 1 Terminal. Transfer of business aviation flights and VIP passenger services to outsourcers.

Plan for the year 2010 is to open a customs control post and a passport control post for servicing international passengers in the business aviation sector as well as to increase the size of this sector and carry out its renovation. In 2010 JetPort SPb, LLC plans to begin working on the construction of a dedicated business aviation terminal.

35

INFRASTRUCTURE

INFRASTRUCTURE
Airdrome
The Pulkovo airdrome has two runways with the dimensions of 3 780 x 60 m and 3397 x 60 m correspondingly, a system of high-speed, connecting and auxiliary taxiways, and 5 aprons. Runways 1 and 2 meet ICAO landing requirements and have no limitations on take-off weight. The airdrome meets certification requirements and is qualified for international flights. Complete renovation of the Runway 1 complex including the construction of a new high-speed taxiway A4 had been carried out from June 2008 to November 2009. The Runway 1 is equipped with ice formation forecasting equipment that transfers information to the work station of the alarm system operator and with a bioacoustic bird deterrent system. Pulkovo airdrome is certified for aircraft landing according to category I minimal meteorological requirements the landing course 10L, 28R, 10R, 28 L; category II the landing course 10L, 28R, 10 R; category IIIA the landing course 10L, 28R. The airdrome is maintained for constant operational availability; it is almost never closed due to airfield and weather conditions. The class A airdrome of Pulkovo Airport is listed in the State Register of Civil Airfields of the Russian Federation and holds a certificate of state registration and readiness for operation 60 of 10.10.2006. The validity of the certificate is extended until 10.10.2011. Main events of 2009: In March November 2009, the scheduled replacement of the upper layer of asphalt-concrete surface of aprons 1, 3 and 4 was performed. In November 2009, the Runway-1 complex was certified and put into operation after its reconstruction. In February 2009 a new measurement complex AT-EM for assessment of a state of friction coefficient on artificial surfaces of runways was purchased. Several units of special machinery were purchased for the airdrome needs: 3 washing vehicles manufactured by SCHMIDT; 1 rotary snow plow manufactured by OSHKOSK.

Following the commissioning of Runway complex 10R/28L after reconstruction, constant monitoring of technical state of the facility and of the artificial surface for formation of various defects is carried out with the purpose of defect elimination by the within the warranty period provided by subcontractor. Plans for 2010: In 2010, it is planned to carry out a scheduled and major overhaul of the artificial surface of the airdrome and intra-airport roads. It is also planned to carry out repairs of the drainage facilities at apron #3 and the area of the Emergency Response Station, repairs of the collector at apron #2 nearby the building of the Post office, and cleaning of the intercepting drain. In accordance with the modernization plan it is intended to purchase 3 VALTRA tractors, an S 900 SCHMIDT vehicle for cleaning artificial surfaces, a SCHMIDT washing vehicle,

37

INFRASTRUCTURE
3 trailers for snow removal, vehicles for the operating shifts personnel; and small tools and equipment for the maintenance of the airdrome according to the requirements of regulating documents.

Table 17. Pulkovo Aerodrome. General information

IATA code LED

ICAO code

ULLI

Country Post Address Operating hours Cut-off altitude /benchmark/air temperature Airport benchmark point Number of runways Length/Width RWY 10R/28L Length/Width RWY 10R/28L

Russia 18/4 Pilotov str., St. Petersburg, 196210 Russia 24

24.0 m/20.0 m/18.5C

5948.01' 03015.45' 2 10R/28L, 10L/28R

3780m x 60m
3397m x 60m 10R/28L cement concrete; PCN 68/R//W/T 10R/28L cement concrete; PCN 83/R/C/W/T

Runways paving

Meteorological minimum categories

Category I10L,28R,10R,28L Category II - 10L,28R,10R Category III A - 10L,28R ILS/MLS RWY 28 HIALS CAT I; RWY 10 HIALS CAT II; RWY 10/28 HIALS CAT III A 350

Landing system equipment

Light signaling equipment

ATIS Frequency ATS Teleport hours MET working hours AIS working hours Regional weather report Nearest city, distance to the city centre Number of aircraft stands Taxing Guidance system

127.4 (RUS), 127.3(ENG) 24 24 24 24, each hour St. Petersburg, 15 km 121 Follow-me; Automatically controlled

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INFRASTRUCTURE
Air terminals
Pulkovo airport infrastructure includes two passenger terminals. Terminal Pulkovo 1 Total area is 42 680 m2. The terminal built in 1973 is located between two runways. This terminal serves domestic, CIS and international charter flights. It has 25 check-in points and 10 departure gates. The passenger capacity of the terminal is 1 300 passengers per hour for domestic flights and 500 passengers per hour for international flights. Terminal Pulkovo 2 Total area is 27 491 m2. Historical Terminal Pulkovo 2 building was built in the 1950s. The terminal was renovated in 2003, when new departure and arrival stations were added. Terminal Pulkovo 2 serves international flights, Rossiya flights to CIS countries and general aviation flights. It has 22 check-in points and 8 departure gates, 4 of which are equipped with boarding bridges. The passenger capacity of the terminal is 1 200 passengers per hour. Terminals Pulkovo 1 and Pulkovo 2 offer their passengers waiting areas, duty free shops, cafes and restaurants, ticket offices and airline offices, Wi-Fi hot spots, car rental services and taxi counters, travel agencies, ATMs, and payment stations.

Events of 2009 In Terminal Pulkovo1 building Installation of LCD monitors in the zones of passenger being served: at holding room entrances and at check-in counters. New form of displaying flight information at check-in counters. Beginning of the program of ceaseless check-in of passengers for Rossiya flights. Introduction of combined check-in technology for flights of UTair and S7 airlines. Beginning of satellite modernization. Opening of two 24 hour check-in counters for the passengers with carry-on luggage only. Opening of 24 hour service counter. Beginning of information boards and signs updating program. Opening of the renovated mother-and-child room. Opening of a new high-comfortable waiting lounge Beginning of WEB check-in technologys implementation. Beginning of the realization of transfer program. Beginning of the Passenger Traffic Service personnel rotation program between the terminals. In Terminal Pulkovo 2 building Introduction of CUTE technology capability to check-in passengers in the airlines system. Organization of parking for self-propelled passenger steps. Installation of smoking rooms.

In 2010, it is planned to replace all information monitors in both terminals, to open six additional departure gates, to open a check-in counter for passengers with carry-on luggage only in Terminal Pulkovo 2 building, to update information boards and signs in the Terminal Pulkovo 1 building, and to introduce WEB check-in technology.

39

2010 PRIORITIES

2010 PRIORITIES
The Board of directors of the Company has determined the following priority directions for Pulkovo Airport, JSC activities for 2010: Fulfillment of the obligations under the PPP Agreement on the creation, reconstruction and operation of the facilities included in the property of Pulkovo Airport (Agreement) including the transfer of Pulkovo Airport, JSC operation, functions, property, and obligations as well as Pulkovo Airport, JSC personnel to the Partner under this Agreement. Providing aviation security until the Partner obtains all necessary certificates, licenses and other permits established by law. Development of a structural subdivision of Pulkovo Airport, JSC to perform the functions of a State Managing Company (SMC) that will control the execution of the Partners obligations under the Agreement. Providing assistance and support to the Partner in implementation of the Investment construction program envisaged by the Agreement and targeted at the development of the Pulkovo Airport infrastructure.

41

DEVELOPMENT PROSPECTS

DEVELOPMENT PROSPECTS
On June 25, 2009, the investment tender for the right to conclude a PPP agreement on the creation, reconstruction and operation of the facilities included in the property of Pulkovo Airport was finalized. Initially the stages, terms and conditions of the tender were approved by the resolution of the Government of Saint Petersburg # 393 of April 16, 2008. This resolution also nominated a tender organizer (Strategic Investment Agency a Saint Petersburg state institution), an authorized institution (the Saint Petersburg Government Committee on Transport and Transit Policy) and also approved a tender panel team. On October 30, 2009, a PPP agreement that was to come into force 6 months from the moment of its signing was concluded with the winner of the tender Northern Capital Gateway, LLC. After the completion of the airport transfer to the new operator Pulkovo Airport, JSC should take complete responsibility for the support and control of implementation of the Pulkovo Airport development project including all risks related to the project implementation and assigned to City Administration and Pulkovo Airport, JSC in the PPP Agreement. A special department, an Investor Relations Directorate, was established in Pulkovo Airport, JSC to implement these objectives and tasks. The employees of this Directorate shall not be transferred to Northern Capital Gate, LLC (hereinafter referred to as Partner) and they will carry out the above-mentioned activity related to the control over implementation of the whole project.

The key objectives of the Directorate activity coincide with the key objectives of Pulkovo Airport, JSC (as a managing company) and include the following: 1. Coordination of cooperation with the winner of the tender prior to the PPP Agreement going into force. 2. Coordination of cooperation with Saint Petersburg state committees in the process of the implementation of the PPP agreement and other documents signed with the Partner for the purposes of realization of Pulkovo airport development project.

43

DEVELOPMENT PROSPECTS
3. Organization and control of subsequent transfer of the airport operation functions from Pulkovo Airport, JSC to the Partner. 4. Control over the implementation of the Partners obligations under the PPP Agreement, support as well as control over implementation of Pulkovo Airport development project during the whole term of the Agreement. In November December 2009 it was carried out some work to ensure that Pulkovo Airport, JSC fulfills its obligations related to the implementation of the preliminary conditions of the PPP Agreement going into force (providing the Partner with necessary documents, submitting a request for the transaction approval to the Federal Antimonopoly Service of the RF, etc.). The Directorate also assists the Partner in the process of transfer of the airport operation management including participation in conferences and working meetings related to the issues connected with the Federal

Tariff Service of the RF in respect of tariff regulation of the Partner activities as well as the development of plans for obtaining and keeping in force licenses and certificates that are necessary for the Partner to provide airport services. The directorate participates in conferences and meetings with the Partner in order to prepare the final version of the PPP Agreement. In the long-term outlook, after the complete transfer of the airport operation functions to the Partner, the Directorate will coordinate with the Partner on the implementation of the PPP Agreement. The main purpose is to provide uninterrupted and efficient operation of Pulkovo Airport as well as to carry out coordination with the Saint Petersburg state committees during the PPP Agreement execution in order to prevent any conflicts during the realization of the Pulkovo Airport development project. In addition, the Directorate will provide assistance in the development of Pulkovo Airport influence area.

44

RISK MANAGEMENT

RISK MANAGMENT

Operations of an aviation company including an airport can be affected by the following risks: Cost increase of consumable resources the risks are connected with the price of fuels and lubricants, maintenance costs of aviation equipment, and maintenance of ground handling services, that are essential for air traffic control. To minimize the above mentioned risks the Administration of Saint Petersburg made a decision to allocate a plot of land for the construction of an alternative fueling company. Increased transport operation risks these risks are related to the reliability of aviation equipment, capability of the ground services to ensure safe operation of the airdrome infrastructure, personnel qualifications, as well as quality control and management systems. Pulkovo Airport has its own fleet of specialized machinery and equipment, professional staff and quality management system which allows it to minimize the above mentioned risks. Competitive environment the more stable and the larger the airline and its market position, the lower is the probability of this risk. Pulkovo Airport, JSC is the main and indisputable leader in the Northwestern Federal District, its services cover the area of 368.3 km2 and 8.36 mln people. Seasonality Saint Petersburg is characterized by a strong seasonal tourist orientation. The passenger traffic peak is observed from June through October. Pulkovo Airport is trying to attract airlines operating flights to destinations

46

RISK MANAGMENT
with stable popularity throughout the year to compensate for these seasonal variations of passenger traffic. The impact of the world economic crisis under the conditions of the crisis the airlines could slow the decline and keep their market presence only by lowering their profitability which, considering the high volume of debts, for many of them can result in discontinuing all operations. Pulkovo Airport has set and

Figure 8. Dynamics of Pulkovo passenger traffic by months, 2002-2009.

fixed the rates that will not increase in the nearest future. This will allow airlines to continue being serviced at Pulkovo Airport without an increase in the ticket prices. Decrease of passenger traffic growth rate in the end of 2008 and 2009 is directly connected with the dynamics of the key economic indicators of the world economy in general and the Russian economy in particular. The situation in Pulkovo Airport looks more favorable compared to many other airports in Russia and abroad. The passenger traffic growth rate decline for the indicated period is much lower compared to other airports located in the RF and in foreign countries. In addition to that, there is one more favorable factor i.e. the simplification of the visa regimes of some countries which will result in an increase of international tourism and, as a consequence, a growth in the passenger traffic of Pulkovo Airport especially for charter flights. Flag carrier activities due to the governmental resolution on the transfer of the flag carrier Rossiya to JSC Aeroflot-RA the airport may lose the carrier and some destinations. Moreover, as a result of said merger, a consolidation of the Russian aviation market will occur that may result in bankruptcy for many

47

RISK MANAGMENT
small carriers. To minimize these risks Pulkovo Airport expands cooperation with its five largest operating carriers in order to develop the route network, and also implements a program designed to increase a transfer flow through Pulkovo Airport by reducing the transfer time. The Airport also continues to work on attracting new airlines. Decommissioning of the Soviet Union manufactured aircraft Aeroflot, S7 and Rossiya airlines have already discontinued using TU-134 and TU-154 aircraft. UTair is now in the process of upgrading its aircraft fleet. Previously these airplanes were used for flights within the RF and CIS countries. The modernization of the aircraft fleet can affect the development of transportation to the indicated destinations. However, those airplanes are replaced with AN-148 jet aircraft and ergonomic planes of the Airbus and Boeing families. Rossiya is expecting two AN-148 airplanes to be delivered by the end of 2010 in addition to the already existing four. It will allow further development of regional transportation on the basis of Pulkovo Airport which in turn will lead to the expansion of the airport route network.

48

SOCIAL POLICY

SOCIAL POLICY
Pulkovo Airport, JSC is one of the largest enterprises of the Northwest of Russia by the number of employees. The airport is implementing large-scale development plans that reflects in forming up of the Company social policy. As of December 31, 2009, the number of employees of the company was 4 196 people. The average age of the employees of Pulkovo Airport, JSC is 40 years.

Figure 9. The employees age structure.

A positive tendency has been achieved in the compensation field. The growth rate of an average salary reached 12.2% in 2009. The employees of the airport are provided with social benefits. Voluntary medical insurance of employees is provided in addition to mandatory medical insurance. A corporate training center was opened in 2007. It became possible to test job applicants and to provide continuous education for personnel. Since 2007, the company has been publishing its own corporate newspaper. Different contests for the Airport employees aimed at developing their creativity and qualifications are regularly organized. Pulkovo Airport cares about sports and the recreation activities of its personnel. The corporate football, ice hockey and volleyball teams are regular prize winners in various city competitions.

50

SOCIAL POLICY
2009 results In 2009, the company labor protection management system was improved. According to the results of the audit carried out by the certification body CCA STATUSCertifica, LLC, the organization of labor protection activities in Pulkovo Airport, JSC complies with the requirements of Safety Certificate # RU 004629 as well as with the interstate standard GOST 12.0.230-2007 Labor Safety Standard System. Labor protection management systems. General requirements. The foundations were made for the certification of the labor protection management system of the organization for conformity with the international standard BS OHSAS 18001. In 2009 total investments in working conditions made by the company exceeded RUR 23 mln. The employees were provided with working clothes and corporate uniforms to the amount of over RUR 12.5 mln. The employees working under harmful conditions were provided with milk and drinking water to the amount of over RUR 5.7 mln and washing agents and detergents to the amount exceeding RUR 0.39 mln. In 2009, various social programs were implemented. The employees were provided with the following: 100 vacation vouchers to the total amount of RUR 2.5 mln. 150 summer vacation vouchers for children to the amount of RUR 2.4 mln. 180 annual passes to fitness-clubs to the amount of RUR 1.5 mln RUR 2 668 employees received training and professional retraining. 2668 people have passed training and professional retraining. 785 employees participated in the program of professional psychological testing including 519 job applicants and 266 employees of the airport. Plans for 2010 Further implementation of the working conditions improvement program. Further employees training and education. Preparation of the company structural subdivisions for the conformity with the requirements of the international standard BS OHSAS 18001.

51

ENVIRONMENTAL PROTECTION

ENVIROMENTAL PROTECTION
Environmentally careful and the rational use of natural resources are key directions of the policy of the Pulkovo Airport, JSC management. It means that the company is continuously striving for taking all necessary measures minimize the negative impact of its operational activity on the environment. 2009 results Total costs of Pulkovo Airport, JSC related to the environmental protection reached RUR 20.9 mln. Air emissions of pollutants from the airport facilities did not exceed specified norms; waste disposal was carried out in accordance with the specified limits. Total water consumption of the company was reduced by 8.9%. The volume of recycled waste was 6.3% of the total waste. The company conducted the training and certification for managers of all levels and specialists of the company in the field of environmental safety in order to improve their competence and reduce the risk of harming the environment. The company conducted additional studies related to the assessment of the ecological situation of the territory based on radiation, chemical, epidemiological and physical risk factors as well as the hydrological studies of the pollution of the Airport soils.

Plans for 2010 Technical modernization designed to decrease the negative impact on the environment. The reduction of pollutant emissions to the atmosphere by means of optimization of the incineration processes.

Long-term plans of the development of environmental protection activities of Pulkovo Airport, JSC include: Construction of special sites for the de-icing of aircraft equipped with containers for the collection and utilization of chemically hazardous substances and the prevention of their ingress into the company storm drainage system. Reconstruction of the Airport treatment facilities for storm runoffs.

53

MAIN PARTNERS

MAIN PARTNERS
SOVEX
The fueling company SOVEX, CJSC was established in 1997 from the property complex of Pulkovo Airport department of fuel and lubricants. The company provides regular aircraft refueling by means of fuel-servicing trucks, and carries out the preparation and quality control of aviation fuel and lubricants throughout all process stages. The property complex has two storage facilities for fuel and lubricants: the reserve and the active. The total capacity of the storage facilities is 29 815 m3 including 28 110 m3 for jet fuel storage. The company owns 17 fuel-servicing trucks with tank capacities from 20 000 l to 40 000 l. A system of central fuel stations is used for fueling. Fuel is supplied to the aircraft parking area of Terminal Pulkovo 1 by means of this system. It covers 18 aircraft parking places and has centralized control. SOVEX, CJSC serves over 200 Russian and international airlines. Due to the world crisis the volume of fueling and sales in 2009 decreased significantly compared to 2008. The total fueling volume was 220 468 tons in 2009. The sales of jet fuel reached 275 488 tons in 2009. In 2009, as part of an infrastructure modernization program, repairs of the main tanks corrosion-resistant coat were completed and 3 new fuelservicing trucks were added to the operation.

Pulkovo cargo terminal

Pulkovo Cargo Terminal, CJSC is the largest aviation cargo terminal in the Northwest of Russia. It is located in the area adjacent to the territory of Pulkovo Airport. Today, this terminal provides twenty-four-hour ground handling of aviation cargo including cargo that requires special handling conditions; it has specialized storage facilities for conventional and special cargo; it carries out reservations and sales of air freight services for regular flights; and provides services in the field of the customs clearance of export/import cargo. In 2009, the total weight of the handled cargo was 20 578 tons including 2 585 tons of mail and 17 992 of cargo. Thus, in 2009, the cargo turnover through Pulkovo Cargo Terminal, CJSC decreased by 22.04% compared to the previous year. The reduction of the cargo turnover is caused primarily by the overall crisis situation that also affected the freight traffic. In 2009, the only cargo airline AirBridgeCargo stopped its flights to Saint Petersburg. KD avia that accounted for 10.5% of the total Russian airline cargo turnover also stopped its operations. However, in 2009, the list of domestic airlines serviced by Pulkovo Cargo Terminal was expanded by the following airlines: Zapolyarie, Region-Avia, Mordovia Airlines and Dagestan Airlines. Yet, the cargo turnover of these airlines was small. As to international airlines, in 2009, Pulkovo Cargo Terminal entered into service agreements with the following airlines: Turkmenistan Airlines and Iberia.

55

MAIN PARTNERS
On September 7, 2009, the Federal Air Transport Agency granted Pulkovo Cargo Terminal, CJSC a new certificate of compliance with the requirements of regulatory documents. This certificate confirmed once again the high level of services provided by Pulkovo Cargo Terminal, CJSC to its clients.

FSUE State Corporation for Air Traffic Support

The Saint Petetrsburg Center for Air Traffic Support is a branch of the FSUE Northwest Air Navigation. The Air Traffic Support Center is responsible for takeoff and landing of aircrafts and air traffic control both within the airdrome area and en route. The air traffic support within the airdrome area is carried out by means of Sintez, a new generation computerized air traffic control system that meets modern international standards. The equipment within the air traffic control area was replaced with a more advanced digital communication Megafon system. Modern technologies that facilitate the work of aircraft crews and ensure a new higher level of air traffic support have been introduced into the air traffic control system. Significant work has been done to optimize the air space structure with respect to ICAO standards and to upgrade take-off and approach paths.

Rossiya In-Flight Catering Service

In-flight catering service is a structural subdivision of the Airports flag carrier Rossiya. The Service was established in May 1993. In the summer of 1994, the company started the reconstruction and re-equipment of the in-flight catering production unit. The unit was opened in 1995. In-flight Catering Service offers various menus to passengers: standard, vegetarian, dietary, religious, childrens, etc. Constant quality control is one of the main objectives of Rossiya In-Flight Catering Service. The French company Servair was the main consultant of the In-Flight Catering Service from 1995 through 2006. Dozens of employees received their training in Paris. The In-Flight Catering Service of Rossiya won numerous awards at international professional contests. In addition to servicing the flights operated by Rossiya, the In-Flight Catering Service provides ongoing services to 11 international, 38 Russian and 9 CIS airlines. In 2009, the In-Flight Catering Service produced 3 216 115 various meals and served 25 961 aircraft. The quality of food and its compliance with international requirements are confirmed every year with the certificate of compliance with the international quality standard ISO 9001:2000 of the GOST-R certification system.

56

MAIN PARTNERS
Lenrianta
Lenrianta, CJSC is the operator of the duty-free shops in Pulkovo Airport. The SovietIrish Joint-Venture Lenrianta was established in March 1989 by Leningrad United Aviation Division and Air Rianta International company (Ireland). The first duty-free shops in Terminal Pulkovo 2 were opened in June 1989. In 2009 the company celebrated its 20th anniversary. The shops and bars of Lenrianta are popular among the Pulkovo airport passengers because practically all goods are supplied directly from the manufacturers. The dutyfree customs regime makes it possible to keep the prices significantly lower compared to the regular retail shops of any country throughout the world. It is very convenient that a buyer can pay for their purchases with Russian Rubles or with any other major currency in cash or with a credit card. The total sales of the company reached RUR 1.48 bln in 2009. Last year one third of all departing passengers shopped in the duty-free shops. The average purchase in the duty-free shops exceeded RUR 2 200.

57

ANNEXES

ANNEXES
Annex 1. Pulkovo Airport History In April of 1930, a decision was made to establish the Institute of Civil Air Fleet in Leningrad. From the very beginning it was planned to set up a training aerodrome that could be turned into Leningrad airport in the future. The place for Aviagorodok (the name of the Institute complex) construction was selected in the southern part of the city, not far from the Pulkovskie Vysoty area. Beginning in January 1931, the area of todays Aviagorodok, Runways and Terminal Pulkovo 2 facilities became a huge construction site. A year and a half later the first facility of the complex the aerodrome went into operation. Leningrad Airport went into operation on June 24, 1932. The airport was originally named Shosseinaya after the nearby railway station. The air brigade of the Flight Training Institute moved here from Komendantsky Aerodrome in the summer of 1932. Since 1935, Shosseinaya Airport has been operating on a year-round basis. Airport construction continued into the beginning of World War II. Gradually, the new buildings of hangars, training, weather station, and crew and passengers premises, workshops and other utility buildings appeared near the airfield. In 1936, the foundation of the Airport building was laid. In 1941, the air route between Moscow and Leningrad that had previously served as a passenger-and-mail route became a regular passenger route. On September 8, 1941, the German army severed all land connections with Leningrad beginning the infamous Siege. The air way became particularly important in those conditions. Shosseinaya Airport was closed on September 12 because of the proximity of the frontline and frequent air raids. The flight operation was transferred to Komendantsky Aerodrome. Only the Paramilitary Security Services Department (VOKhR) remained at Aviagorodok. On September 20, the State Defense Committee set a goal to restore the Leningrad air supply. On October 10, 30 LI-2 aircrafts of the Moscow Air Group started transportation services. They landed at Komendantsky Aerodrome and later at Smolnoye Aerodrome that was constructed within 2 months. The Germans were unable to detect Smolnoye Aerodrome until the very end of the war. From June 22, 1941 through January 1, 1944, Leningrad airport received, serviced and sent out 6 969 aircrafts that carried 83 684 passengers and 10 640 tons of cargo and mail. Immediately after the Siege, in January 1944, the reconstruction of Shosseinaya Airport started. During the war the frontline crossed the Airports territory. The airfield, buildings and houses were partly destroyed by the artillery and air attacks. During the reconstruction, all passengers and cargo flights were carried through Smolnoye Aerodrome. On January 17, 1946, the head of Civil Air Fleet signed a resolution on the transfer of Leningrad Airport operations from Smolnoye Airdrome to Shosseinaya Airdrome.

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ANNEXES
During 1948 the air brigade crews already operated regular flights to Sverdlovsk, Novosibirsk, Minsk, Kuibyshev, Kaliningrad, Simferopol, Kiev, Tashkent and other cities. In 1950, Leningrad airport crews carried 11 563 passengers, 95.6 tons of mail and 2 813 tons of cargo. The next year a new terminal building designed by A.I. Gegello was put into operation. In 1963, all the aviation departments of Shosseinaya Airport were combined into one, the Leningrad United Aviation Brigade. This reorganization allowed a more efficient resolution of the organizational and technical problems of the new equipment operation. In 1965, Leningrad Airport was only second to Moscow Vnukovo Airport in the number of passengers carried. Due to an increasing volume of flights, the decision was made to build another terminal. The new Terminal with a passenger capacity of 2 000 people was opened on the night of April 24-25, 1973. The most modern architectural and technical ideas, like the separation of arriving and departing passengers, were utilized. This Airport Terminal is still important for Saint Petersburg because of its unique architectural ideas. At the same time this new Terminal was renamed Pulkovo. That same year, the second Runway was constructed.

In subsequent years, the Airport management did their best to meet international requirements. The Airport provided new passenger services, implemented the latest passenger and freight transportation technologies, and had modern equipment installed. Serious attention was paid to crew training. Pulkovo-2 Airport became the second international airport in the country. 380 000 passengers were carried via international flights to 19 European countries. On April 11, 1986, the crew of TU-154 jet was the first to fly out of new Terminal Pulkovo 2 carrying its passengers to Berlin. Two new modern and roomy buildings

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flanked the old pre-war terminal. After the new Terminal opened, the Airport was able to double the number of international passengers served. In 1990, Pulkovo Airport served about 10 mln passengers a yet unbroken record for the Airport. On June 5, 2005, the International Air Transport Association that unites more than 280 world airlines accepted Pulkovo as a full member. 2005 made Pulkovo history as the year when the Airport became an independent company after separating from Pulkovo Airline. In 2006, a Pulkovo Airport development concept was created that was included in the Airport Development Master Plan that is to be carried out through 2025. The Master

Plan envisions a new passenger terminal construction, infrastructure development and complete modernization of the airdrome. The realization of the Master Plan started on February 16, 2007, when an international architectural contest for the new passenger terminal design and adjacent territory development was announced. In April 2008, the Saint Petetrsburg Government announced an international investment tender that would help to find an investor for the Airport development. The investment tender was completed in 2009. International Consortium Northern Capital Gateway, LLC won this tender. This consortium includes: VTB bank, airport operator Fraport AG (Germany) and investment company Copelouzos Group (Greece). In October 2009, a Public-Private Partnership agreement was signed between Pulkovo Airport, JSC, Northern Capital Gateway, LLC and the Administration of Saint Petersburg. According to this agreement the Saint Petersburg airport will be transferred to the management of the investor for a 30-year period. During that time Northern Capital Gateway, LLC will implement large-scale projects related to the reconstruction of the airport infrastructure and will manage all operating processes. The beginning of the XXI century is also the beginning of the newest history of Pulkovo Airport that has the potential of becoming one of the most modern European airports.

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Annex 2. Pulkovo Airport Passenger traffic by countries in 2009
Country Passengers carried, pax

2009/2008, %
-15,7%

Armenia

28 914

Austria Azerbaijan Belorussia Bulgaria China Croatia Cyprus Czech Republic Denmark Dominican Republic Egypt Estonia Finland France Germany Greece Hungary India Israel Italy Japan Kazakhstan

62 265 46 160 10 091 76 836 46 899 8 748 65 243 87 383 55 877 5 310 261 239 3 291 123 496 172 426 677 552 98 369 8 936 8 134 96 195 128 129 2 066 51 303

-7,9% -1,7% 23,2% -1,7% -2,0% -40,0% -0,4% -13,7% -24,7% 139,6% -11,3% 641,2% -0,9% -12,4% -1,3% -14,7% 21,6% 23,7% 48,2% -23,4% -74,3% -8,9%

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Kirgizstan Latvia Malta Moldova Montenegro Netherlands Norway Poland Republic of Korea Russia Spain and the Canary Islands Sri-Lanka Sweden Switzerland Tajikistan Thailand Tunisia Turkey Turkmenistan Ukraine United Arab Emirates United Kingdom Uzbekistan Others

23 765 42 636 3 841 23 962 17 395 72 803 17 885 26 775 21 528 327 3481 59 198 4 511 54 021 81 817 79 249 15 335 85 848 309 454 13 261 77 262 14 413 90 806 192 131 32 113

-15,5% 16,8% -43,9% 23,5% -24,9% -5,1% -43,7% -15,6% 4,4% 0,4% -36,4% 50,7% -16,3% 34,4% 10,8% -62,0% -22,1% -16,0% 165662,5% -12,4% -28,0% -16,9% -7,8% -35,0%

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Annex 3. List of airlines operating regular flights in Pulkovo Airport in 2009

Domestic

International

CIS
Aerosvit

Aeroflot

Air Baltic

Atlant-Souz Bugulminskoe AE Dagestan Airlines Donavia Gazpromavia Globus Izhavia Kavminvodiavia KD avia* Kuban Airlines Mordovia Airlines Nordavia Orenburg Airlines Polet Region-Avia Rossiya S7 Saravia Severstal SkyExpress Tatarstan

Air Berlin Air France Air Malta Alitalia Austrian Airlines Blue Wings British Airways Bulgaria Air Czech Airlines El Al Estonian Air Eurocypria Airlines Finnair Germanwings Hainan Airlines Iberia Kartago Airlines KLM Korean Airlines LOT Lufthansa

Air Moldova Armavia Azerbaijan Airlines Belavia Kyrgizstan Airlines SCAT Somon Air Tajik Air Turkmenistan Airlines Uzbekistan Airways

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Transaero Ural Airlines UTair Vladivostok Avia Volga-Aviaexpress Yakutia Yamal

Malev Montenegro Airlines Norwegian Air Shuttle Nouvelle Air SAS Swiss Turkish Airlines Vueling (Clickair) Wind Jet

* airlines have already stopped operating flights * New airlines are marked with color

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Annex 4. Route Network (regular flights)
Domestic International

CIS
Almaty

Anapa

Amsterdam

Arkhangelsk Barnaul Chelyabinsk Cherepovets Ekaterinburg Irkutsk Izhevsk Kaliningrad Kazan Khabarovsk Kostomuksha Krasnodar Krasnoyarsk Kursk Lipetsk Magadan Makhachkala Mineralnye Vody Moscow Murmansk Nadim Nariyan-Mar Nijniy Novgorod Nizhnevartovsk Norilsk Noviy Urengoy Novosibirsk

Antalya Bangkok Barcelona Beijing Berlin Budapest Burgas Catania Cologne Copenhagen Djerba Dubai Dusseldorf Forli Frankfurt am Main Geneva Goa Hamburg Hannover Helsinki Heraklion Hurgada Innsbruck Istanbul Karlovy Vary Larnaka London

Ashkhabad Astana Baku Bishkek Bukhara Dushanbe Erevan Fergana Giandja Karaganda Khujand Kiev Chisinau Kustanai Minsk Namangan Odessa Osh Pavlodar Samarkand Simferopol Tashkent Urgench Ust - Kamenogorsk

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Orenburg Perm Petropavlovsk-Kamchatskiy Rostov-on-Don Salekhard Samara Saransk Saratov Siktivkar Sochi Surgut Tyumen Ufa Yuzhno - Sakhalinsk Vladivostok Volgograd Voronezh Yakutsk Madrid Malta Milan Monastir Munich Nice Oslo Paphos Paris Phukhet Podgorica Prague Punta Cana Riga Rimini Rome Thessaloniki Salzburg Seoul Shardja Sharm-el-Sheikh Sofia Stockholm Tallinn Tel-Aviv Tivat Varna Vienna Verona Warsaw Zurich

* New destinations are marked with color

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Annex 5. Contacts
Company name Open Joint-Stock Company Pulkovo Airport

Location

18/4, Pilotov str., Saint Petersburg, 196210, Russia

Pulkovo Cargo Terminal, CJSC

Tel.: +7 (812) 380 69 00 Fax: +7 (812) 380 69 02 Cargo tracking information: .: +7 (812) 380 69 45, 380 69 55 Tel.: +7 812 327 28 52, +7 812 704 36 37, 704 5909, 704 5911 Fax: +7 (812) 327 87 01 E-mail: sovex@sovex.ru, sales@sovex.ru Tel.: +7 (812) 704 36 11

SOVEX< CJSC fueling complex

Telephone operator

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