Airline Industry Partnering for Transformation 24 th January 2013 | IBS Cargo Forum | Trivandrum Private and Confidential © IBS Software Services 2013 V K Mathews | Chairman | The IBS Group

2 Air Transport Industry Air Cargo Industry IBS - Partnering for Transformation Agenda

World Airlines – Traffic Forecast Air travel will double in the next 15 years Operations will have to deal with more traffic, complex networks and greater congestion 3

World Airlines – Traffic Forecast 4 Source: BOEING Air travel becomes more diverse geographically Legacy carriers start LCC’s and new start-ups concentrate in emerging economic regions Increased demand for flight operations capability, with low upfront costs

World Airlines – Aircraft Forecast 5 Source: BOEING Industry need 34,000 new aircraft; including replacements

World Airlines – Performance to Date 6 Source: IATA Cumulative profit margins over the past 40 years is nominal The pressure to improve asset utilisation and labour productivity will continue in airline operations

World Airlines – Performance to Date 7 Air travel and economic growth are directly related For industry to continue to grow with GDP growth, aero-political reforms are required The industry will experience further consolidation which will impact airline operations Source: ICAO, IMF

World Air Cargo – Actual Traffic World air cargo traffic has slowed down in the past decade 8 Source: Boeing World Air Cargo Forecast

9 World Air Cargo – Forecast World air cargo traffic will more than double in the next 20 years Source: Boeing World Air Cargo Forecast

10 World Air Cargo – Forecast Freight yield has declined at an average of 4.2% over the last 20 years Source: Boeing World Air Cargo Forecast

Airline Cargo Industry – Capacity Utilization Capacity utilization well below 50%, causing yield erosion Source: IATA, ICAO 11

Airline Industry – Challenges & Priorities Challenges Respond to changing market conditions Respond to changing customer needs Enhancing market-share & profitability Top three investment priorities of large airlines Improve customer experience Enable new markets/revenue opportunities Reduce cost of business operations 12 Source: Airline Business IT Trend Survey

Airline Industry – Key IT Trends 13 Standard Products supporting Industry Best Practice From heavily customised bespoke solutions to configurable community products, following industry best practice processes. Reduces costs, risks and time-to market Stronger Competitive Market The pressure on IT companies will increase to support changing operations models. The trend will be to provide the solutions as a service to airlines

IBS Partnering for Transformation

To become the No.1 IT solutions company in the world for air transportation industry by 2020, by: Helping airlines achieve their business goals by facilitating business process innovation Creating next generation IT products to support such innovative business models, with the objective of 1.reducing airline’s cost of operations 2.enhancing its revenue and market share, and 3.improving customer experience Becoming a one-stop-shop for all areas of airlines’ business – passenger services, cargo services and flight operations, including business process outsourcing Achieving schedule and cost advantage by utilizing highly scalable, cost effective Indian IT manpower IBS Business Strategy 15

IBS Strategy - Competitive advantage The strategy addresses the key challenge of the civil aviation industry – to grow profitably in a fiercely competitive market place. The strategy focuses is on enabling airlines’ achieve their own business goals – i.e. enhance revenues and optimize costs (instead addressing their IT needs). IBS’ achieves this because of its: 1.Domain competence to facilitate business process/ model innovation and change 2.Substantial investment in creating intellectual property and next generation IT systems 3.Business presence in all geographies 4.Access to scalable, cost effective Indian IT workforce IBS has invested over 6,000 man-years to create next generation IT systems that will help airlines change their business models to gain competitive advantage Competition do not have the breadth and depth of new technology solutions for the airline industry as what IBS has Evidence of success of strategy: Leading global airlines have chosen the next generation solutions from IBS and are investing to switch to IBS’ systems. 16

IBS Business Today 17 product-lines, across 11 lines of businesses Passenger Services, Loyalty, Travel Tour & Cruise Hospitality Cargo Services, Flight & Crew Operations, MRO, Airport Operations Oil & Gas Logistics, IT Professional Services Global Operation Americas, Europe, MEA, APAC (10 offices worldwide) 30 nationalities, 2000 professionals 6 Acquisitions TopAir from EDS, Zurich, in 2002 Avient Technologies from Honeywell, London, in 2003 Discovery Travel Systems, Washington, in 2006 VISaer, Boston, in 2008 Moveo Systems, Bangalore, in 2011 HBSi, Atlanta, in 2012 Domain Competence & IP person-years to build next generation products Highest Quality Certifications SEI-CMMI Level 5, ISO 9001:2008 & TickIT certified ISO 27001:2005 certified 3 Data Centers Ashburn, Tokyo, Trivandrum 17

170 plus customers, include the world’s Best airlines Best known airports Best cruise lines Best hotel companies Best travel distributors Top oil & gas companies 18 IBS Customers

IBS – Cargo Line of Business The vision is to establish IBS as the global leader for end- to-end cargo solutions by delivering quantifiable value to the air cargo industry by adopting the following strategies: Robust and innovative solution platform that future proof industry requirements ‘SaaS’ mode of solution offering enabling customer to focus on business priorities Domain lead vertical outsourcing providing cost optimizations at operational level Business and product consulting to enable process optimization, re-engineering and innovation 19

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