Improved revenue and financial performance of LOT Polish Airlines has been achieved in extremely difficult market environment mainly in the result of cost cutting policies and excellent development programme. In 2007, LOT further increased its share in low fare airline market (up to 50%); however, increasing prices of fuel increased LOT’s cost approximately by PLN 56 million. Strengthening PLN also affected the company’s bottom line: more than 25% of LOT income is generated in USD, and as much as 34.8% is obtained in Euro.

„This October, we presented the framework of four-year LOT strategy, but the actions aimed at resolute improvement of the company’s position had been implemented much earlier. The financial results which we present today constitute a measurable effect of our earlier actions. They show a noticeable revenue growth, achieved on a very difficult market, in strong competitive environment. The significant increase of serviced passengers shows that our actions head in the right direction. We have also pursued restrictive cost-cutting policy, and in the result, we have achieved considerable growth of financial performance. In my opinion, the three-digit growth of profit as compared with previous year is a huge success”, said President of the Managing Board of LOT Polish Airlines Piotr Siennicki

Throughout three quarters of 2007 number of LOT flights increased considerably (by 7%, reaching 67.50 thousand), mostly due to launching flights to new destinations from Warsaw and other Polish cities. The RPKM (Revenue Passenger Kilometre) index grew by 10% reaching 5.8 thousand after three quarters of 2007. LOT also noted a regular increase in the number of passengers choosing its services – by 459 thousand persons (16%).as compared with the same period last year. Also the passenger seat ratio went up, reaching 76.3% at the end of September (In 2006 it amounted to 74.8%).

„Last year, our company noted basic operations losses, amounting to PLN 43 million at the end of 2006. Throughout first 9 months of 2007 we achieved PLN 83 million profit. We plan to achieve a basic operations profit of PLN 50-60 million at the end of this year. We have noted an improvement of all key economic ratios,” Siennicki added.

In 2007, the company’s ROIC (return on invested capital) increased by 621%, and the current liquidity ratio also grew, reaching the excellent level of 1.3); on the other hand, the debt ratio went down, reaching safe proportion of 73%.

In October 2007, the Managing Board of LOT Polish Airlines presented guidelines for the company’s new strategy for the years 2008-2012. The strategy focuses on increasing the attractiveness of the offer, basing on seven essential pillars. The company plans to unify its fleet, leave two brands at LOT Group, develop its eastern flight destinations (Russia, Ukraine) and increase its e-sales to at least 40% in 2012. The Managing Board plans also to launch the company on the Warsaw Stock Exchange in 2008 and to exceed net profit level of PLN 200 million in 2012.