1. IAS Financial results 2002

2. Efficiency increase in 2002

3. Major directions of activity in 2002 Still network optimization - In 2002 Company continued to develop it’s rout network and the priority was given to the routs with a high profitability Raising of fleet usage effectiveness - In 2002 the Company substantially decreased usage of fuel ineffective aircrafts such as: Il 76, Il 86, Il 62 Foreign made fleet replacement program - In 2002 it was taken decision on replacement of 27 foreign made aircrafts of the Company on the 27 new foreign made aircrafts with aim to optimize operating costs.

4. Market environment Shortage of adequate capacity Noise & emission restrictions introduced by European countries Strict regulation Still high degree of fragmentation Low purchasing power – low yield – major constraint Higher growth rates in the charter segment 6,9% 5,8%

5. Competitive position Still an ultimate leader in the industry Recent decrease of the market share is due to: –radical reduction of old Soviet-built aircraft capacities –concentration of the market growth in the non-core segment

6. Network optimisation Concentration of capacities on high-yield routes Providing high yield routes with competitive planes Improvement of connectivity (over 2001 connectivity was increased from 11,3% to 14%) Closure of loss making / marginally profitable routes SU 3,66,910,4 Network qualityNetwork structure by revenue 3,9% 8,5%

7. Fleet utilisation Gross utilisation of B767, B737, B777, A310, DC10 in 2002 increased on 3,8% beside 2001 Gross utilisation of Il96, Tu134, Tu 154 in 2002 increased on 11,2% beside 2001 Gross utilisation of Il62, Il76, Il86 in 2002 declined on 73,8% beside 2001

8. Western fleet restructuring B777-200ER (2) B767-300ER (4) A310-300 (11) B737- 400 (10) B767-300ER (operating leases) А320 family (10 operating leases, 8 finance leases) 1 type of LH aircraft (9) 1 type of MH aircraft (18) 27 aircraft Primary objectives: Ensure significant cost savings and increased operational efficiency through higher fleet commonality Incorporate high degree of fleet planning and fleet management flexibility Achieve high asset liquidity and broad choice of long-term financing sources

9. Russian and cargo fleet restructuring Il96-300(6) Il62 (10) Il86 (14) Tu154M (20) Tu134 (15) Medium-term target - provide further commonality of the whole fleet Il76(10) DC10F(2) 1 type of LH aircraft 6 Il96 + 6 on order 1 type of MH aircraft 20 Tu154M 1 type of SH aircraft 11 Tu134M 65 aircraft 52 aircraft 1 type of freighter 4 DC10F

10. Operating profit and net profit dynamics

11. Operating Results 2002

12. Main operating figures -6,8% -5,9% -4,7% 8,1%

13. Load factors and fuel consumption 1% of passenger load factor increase - USD16,5 mln of additional revenue 1% of commercial load factor increase - USD27 mln of additional revenue

14. Financial Results 2002

15. Profit and loss statement

16. Revenue and traffic revenue 0,3%1,9% 0,4

17. Traffic revenue by sector

18. Passenger traffic revenue by region

19. Cargo traffic revenue by region

20. Revenue rates Revenue rate per 1 passenger increased on 5,8% beside 2001 on international routs - on 9,2%, on domestic routs - on 3,9%. Revenue rate per 1 RPK increased on 8,5% beside 2001 on international routs - on 10,0%, on domestic routs - on 3,6%.

21. Operating costs 1218,3Total 54,5Other expenses 5,6Increase in (release of) provision for bad and doubtful accounts 35,9Communication expenses 41,5Third – party passenger services 56,9Operating taxes 83,2Administration and general expenses 99,5Operating lease expenses 110,7Sales and marketing 112,5Maintenance 259,3Aircraft and traffic servicing 358,7Fuel (USD mln) % to 200120022001 ( USD mln) 274,7 244,8 109,7 103,2 104,2 69,5 30,6 32,5 35,3 6,2 Penalties-16,4 54,7 1081,8 76,6 94,4 97,5 93,2 104,7 83,5 53,8 78,3 98,3 110,7 - 100,4 88,8

22. Operating costs structure 100 Total 4,5Other expenses 0,5 Increase in (release of) provision for bad and doubtful accounts 2,9 Communication expenses 3,4 Third – party passenger services 4,7Operating taxes 6,8Administration and general expenses 8,2Operating lease expenses 9,1Sales and marketing 9,2Maintenance 21,3Aircraft and traffic servicing 29,4Fuel 20022001 25,4 22,6 Penalties 10,2 9,5 9,6 6,4 2,8 3,0 3,3 0,6 -1,5 5,1 100

23. Key factors of operating profit change Operating profit 2001 Traffic decrease Fairs increase Decrease of other revenue Fuel costs decrease Aircraft and traffic servicing costs decrease Maintena nce costs decrease Sales and marketing costs decrease Third party passenger servicing costs decrease Salary increase Operating profit 2002 Administration and general expenses decrease Depreciation increase Other decreased costs Aircraft and traf. serv. costs decrease

24. Operating costs and production cost -7,4% -3,0%

25. Operating activity results In 4,5 times

26. Balance sheets 31.12.01 (USD mln) 31.12.02 (USD mln) Change to 2001 Current assets292,6320,427,8 Long – term assets819,6565,0-254,6 Total assets1 112,2885,4-226,8 Short – term liabilities562,6461,9-100,7 Long – term liabilities464,3250,8-213,5 Minority interest7,67,90,3 Shareholders’ equity77,7164,887,1 Total liabilities and Shareholders equity 1 112,2885,4-226,8

27. Cash flows

28. Capital Structure

29. Long-term strategic focus Profitable market growth Increase of operating and financial effectiveness Product upgrade and brand development Leadership in national industry consolidation Building strategy-focused organisation World alliance membership Strategic projects: –New hub –Group restructuring