Finnair (FIA1S) investor relations material

Strategic direction and customer focus

• Strategy for 2026–2029 centers on core customers, modular product offerings, digital retailing, and loyalty beyond travel, prioritizing engagement, convenience, and reliability.

• Network pivot post-Russian airspace closure led to a balanced route structure, with Asia now 36% of capacity and increased focus on Europe, North America, and the Middle East, covering over 100 destinations.

• Loyalty program expansion and digital retailing are key growth drivers, aiming to double ancillary revenue share, triple loyalty revenue beyond travel, and grow Finnair Plus active members to over 3 million by 2029.

• Partnerships, especially within Oneworld and joint businesses, are leveraged for global connectivity and demand, with Helsinki as the central hub.

• Customer experience is prioritized, with NPS scores above peer averages and a target to exceed 40.

Financial targets and investment plans

• Targets 4% CAGR passenger growth in core markets, with EBIT margin of 6%-8% by 2029, underpinned by €100 million profitability improvement.

• Plans €2–2.5 billion CapEx for partial narrow-body and regional fleet renewal by 2029, balancing investments with strong operating cash flows north of €500 million per year.

• Maintains a healthy cash-to-sales ratio of at least 20% and leverage target of 1–2x net debt/EBITDA throughout the strategy period.

• Dividend policy reiterated at one-third of EPS, with expected yield of 3%-4% of market cap, considering seasonality.

• Cost competitiveness remains a priority, with disciplined CASK management, digitalization, and AI-driven operations to drive efficiency.

Operational excellence and growth execution

• Operational excellence, safety, and on-time performance are foundational, with regularity at 99.2% and OTP at 81.6%, supporting high customer satisfaction and cost efficiency.

• Fleet right-sizing, ongoing negotiations for new aircraft, and tactical use of wet/dry leases enable agile capacity management amid supply chain constraints.

• New destinations, direct Europe-Lapland routes, and expanded partnerships support network growth and customer choice.

• Strategic partnerships with airports, regional operators, and within the Avios loyalty ecosystem enhance value chain efficiency and service quality.

• The organization fosters a "one crew" culture, leveraging diversity, talent, and high employee engagement to support growth and transformation.