Report of meeting with shareholders in Aerodrom Ljubljana, d.d.

The Management Board of Aerodrom Ljubljana, d.d. held a meeting with the company’s shareholders on Friday, 18 November. The shareholders were briefed on the progress to date in connection with the construction of Terminal 2, which will be Aerodrom Ljubljana’s principal investment in the coming years, and on other planned development projects. With the approval of the Supervisory Board, the construction of Terminal 2 was postponed in 2009 and 2010 because of the recession and the commercial difficulties of the most important business partner.

Aerodrom Ljubljana is envisaging investments of EUR 115 million in the period to 2017, of which EUR 72 million will be spent on the terminal, construction of which is expected to begin next year, and to be completed by May 2015. In addition, the construction of a small logistics centre is planned for 2013, while the construction of a cargo terminal is planned for 2014 and 2015.

The existing passenger terminal is no longer capable of reaching satisfactory quality standards. It is already too small for busier times of the day and busier months of the year, and given the projected trends in aviation, passenger numbers will increase further and within five years are forecast to again reach their level of 2008, when close to 1.8 million people passed through the airport. The new terminal, which will cover an area of 31,200 square metres, will have a capacity of 1,800 passengers per hour. The existing terminal, built in 1973 and later reconstructed, currently has an area of 13,000 square metres. After completion of the new terminal, it will remain used in part for transportation, but will also be partly converted for commercial purposes.

The new terminal - for which planning began 20 years ago - will eliminate the bottleneck, will guarantee the requisite security and safety in air transport and will also provide extra space for commercial activities. The project has been coordinated with numerous government papers and other documents, including Slovenia’s Development Strategy, the National Development Programme and the Resolution on the Transport Policy of the Republic of Slovenia, and is ready for execution.

Approximately 38% of the financing for the terminal will come from internal resources, while 40% will come from a bank loan to Aerodrom Ljubljana with a repayment term of 15 years. For the remaining 22% the aim is to obtain grants from the European Regional Development Fund, for which an application was lodged with the European Commission this July, and is now being discussed.

The estimated project value of Terminal 2 was drawn up on the basis of assumptions and prices in 2008. The financial aspect of the project is being examined again at Aerodrom Ljubljana. In light of the changed circumstances, the aim is to optimise the investment by undertaking the construction in a modular fashion, but it is also felt that it is now possible to achieve lower prices than those applying when the investment programme was drawn up.

November, 2011