ANNUAL GENERAL MEETING OF "SIBERIA" AIRLINES" SHAREHOLDERS
The following issues were considered at the meeting:
|1.||Approval of the company’s annual statement for 2005|
|2.||Approval of the annual financial statements, including profit and loss statements (profit and lost accounts)|
|3.||Approval of the company’s profit-and-loss sharing subsequent to the results of 2005|
|4.||Amount, terms and payment form of dividends subsequent to the results of 2005|
|5.||Defining the number of the board’s members|
|6.||Election of board directors|
|7.||Election of the lay auditors|
|8.||Appointment of the company’s auditor|
Aleksandr Vindermut, Principal Deputy to Operations Director General, made a presentation about the results of the production and financial activities of "Siberia" Airlines" JSC op. for 2005. He mentioned in his presentation the summary indicators of the company’s business and financial activities for the reported period:
The service revenue of "Siberia" Airlines" for 2005 amounted to 19,652 million RUB, which exceeded the results for 2004 by 30.4%. The distribution cost of services amounted to 18,766 million RUB in 2005, exceeding the indicator of 2004 by 39.4%. Summarizing the results of operation in 2005, the airline incurred the all-inclusive loss to the amount of 1,101 million RUB. The company’s production and commercial operations indicators for 2005 were influenced by the following events and tendencies: sharp rise in average prices for fuel and for airport services, additional investment costs connected with modernization of the fleet, undistributed deficit of the prior years.
In 2005 the average price of fuel for the company increased by 44% in comparison to the year 2004. The growth of prices for airport services surpassed the inflation rate. As a result, the general growth of the specific direct operating expenses in 2005 amounted to 24%, exceeding the normal tariff growth ratio. The large share of expenses for fuel was caused by the low fuel efficiency of the aircrafts produced in Russia as well as absence of hedging instruments in respect of the fuel prices in Russia.
Thanks to modernization of the company’s fleet, the airline managed to increase the fuel efficiency in 2005. However, the modernization of the fleet required additional investment expenses. In 2005 the investment expenses for maintenance of the western aircrafts amounted to 566 million RUB. The investment expenses for pilot retraining in operation of the western aircrafts amounted to 93 million RUB in 2005.
In spite of the indicated factors and improvement of competition in the main markets, the airline showed the growth of the key performance indicators. Over 2005 "Siberia" carried out more than 32 thousand flights transporting more than 4.2 passengers, exceeding the numbers of 2004 by 12.3% (the average growth of indicators for the Russian civil aviation amounted to 3.9%). Over the last year the company has essentially expanded the fleet of foreign-made aircrafts — 8 Boeings 737-500 and 4 Airbuses A310 were leased for operation. 8 new regular flights were launched along with introduction of a number of new charter flights.
2005 "Siberia" Airlines" was the first among the Russian carriers to sell the transportations through the Internet. The company opened an in-house business hall in Domodedovo airport. As a part of the service improvement program concerning the company’s flights the airline introduced a system of simultaneous check-in, which allowed to increase the efficiency of the check-in process deliberately and to avoid queues. Over the last year an essential progress was made in the re-branding program. The airline started to introduce actively the elements of its new brand - S7 Airlines.
The shareholders cast an affirmative vote for approval of the annual statement, balance sheet, profit and loss accounts for 2005. According to the results of operation in 2005 it was resolved not to pay dividends upon shares.
The Novosibirsk audit firm "Audit-Garant" LLC was appointed the auditor of "Siberia" Airlines" JSC op. for 2006. The company has also elected the lay auditors.
The shareholder’s meeting also elected new members of the company’s board of directors consisting of nine persons: A.A. Vindermut — Principal Deputy Director General of "Siberia" Airlines" JSC op., A.V. Gribkov — member of the board of directors of "Eurofinansy" brokerage and investment banking" JSC op., A.A. Koshkin — Director General of "Sibmost" JSC op., I.B. Kuznetsov — Director General of "Factor Ltd" JSC cl., T.I. Lomovtseva — Director for Property and Corporate issues of "S7 Group" JSC cl., Yu.V. Tolmachev — Chief Specialist of the Federal Property Management Agency, V.F. Filev — Director General of "Siberia" Airlines" JSC op., N.V. Fileva — Director General of "S7 Group" JSC cl., I.Yu. Shilina — Deputy to the Head of the Siberian Interregional Branch of the Russian Fund for Federal Property.
Later in this day, the elected members of the board of directors reappointed Albert Aleksandrovich Koshkin, Doctor of Engineering Science, the Chairman of the board of directors.