SAS Group Year-end report January-December 2006

Favorable economy combined with new business models, and effective cost and capacity control resulted in improved earnings

• Operating revenue for the full year amounted to MSEK 60,777 (55,501), an increase of 9.5%. For the fourth quarter, operating revenue amounted to MSEK 15,157 (14,492), an increase of 4.6%. Operating revenue excludes revenue for the hotel business, which is reported as a discontinued operation.

• Number of passengers rose by 6.3% to 38.6 million and by 3.9% to 9.6 million during the fourth quarter.

• Nonrecurring items totaling MSEK 667 (413) were charged against full-year results, of which MSEK 337 (413) pertained to restructuring costs, MSEK 146 (0) to impairment losses and MSEK 184 (0) to other nonrecurring items.

• Income before capital gains and nonrecurring items amounted to MSEK 1,279 (114) for the period, an improvement of MSEK 1,165. Income for the fourth quarter totaled MSEK 735 (228).

• Income from discontinued operations amounted to MSEK 4,576 (577). Rezidor Hotel Group was listed on the stock exchange on November 28, 2006.

• Net income for the full year amounted to MSEK 4,740 (255) and MSEK 4,647 (198) for the fourth quarter.

• Equity/assets ratio amounted to 32% (21%)at December 31, 2006.

• CFROI for the twelve-month period January-December 2006 was 15% (13%).

• Earnings per share for continuing and discontinued operations for the SAS Group amounted to SEK 28.10 (1.06) and SEK 28.01 (0.88) for the fourth quarter. Earnings per share for continuing operations amounted to SEK 0.78 (-2.01) for the full year. Equity per share amounted to SEK 99.49 (69.93).

• Cost savings corresponding to SEK 2.5 billion are currently being implemented. At year-end, 79% of the savings had been put into effect.

• On January 1, 2007, Mats Jansson assumed the position of President and CEO.

• The Board of Directors proposes to the Annual General Shareholders' Meeting that no dividend be paid to shareholders in SAS AB for fiscal year 2006. This is motivated by the SAS Group's relatively weak financial position and cash flow, as a result of which, financial flexibility will be of major importance in managing future restructuring measures and investments.

• "The result reported for 2006 is a good sign, but the level is too low to meet shareholders' return requirements and future investment needs. There are currently no indications of a slowdown in the economy or the airline market. However, uncertainty remains regarding the strength of growth, the future competitive situation and the trend for jet fuel prices," says Mats Jansson, President and CEO.

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