September 2014

Passenger Traffic Flow Development

Total Scheduled Revenue Passenger-Kilometers To/From and Intra Regions (trillions)

2 Source: Boeing Current Market Outlook 2013-2033, IATA Industry Financial Forecast March 2014

Total Revenue (2014F)

745 Billion USD (2013 -2014 5.3% growth)

Schd. Passenger (2014F)

3.3 Billion

(2013 -2014 5.6% growth)

RPK (2014F)

6.1 Trillion

(2013 -2014 5.8% growth)

2033 2013

2,0

4,6

2,2

7,4

2,0

3,9

0,6

1,9

0,3

0,9 0,6

2,2

Europe Asia Pacific North America Latin America Africa Middle East

International Passenger Growth

3

Africa

Asia - Pasific

Europe

Latin America Middle East

North America

Average

0

500

1.000

1.500

2.000

2.500

2,5% 3,0% 3,5% 4,0% 4,5% 5,0% 5,5% 6,0% 6,5%

20

31

Pas

sen

ger

Nu

mb

er

2011-2031 Annual Average Growth (CAGR)

International Passenger Growth Regionally (2011 - 2031)

*The diameter of spheres show extra passenger number in 2031 compare to 2011

• Although growth rate of international passengers at European airports will be lower than the rest of the world, Europe will still have the biggest international passenger share.

Source: ACI 2012-2031 Traffic Forecast

4

Regional Aviation Market & Economic Growth

RPK: Revenue Passenger Km * Europe except Turkey (a forecast value)

Source: Boeing Current Outlook 2013-2032

0%

1%

2%

3%

4%

5%

6%

7%

LatinAmerica

Asia Pasific Middle East Africa World CIS NorthAmerica

Europe* Turkey

4,0%

4,5%

3,8%

4,4%

3,2% 3,4%

2,5%

1,8%

4,3%

6,9%

6,3% 6,3%

5,7%

5,0%

4,5%

2,7%

4,1%

6,0%

GDP Growth (2013-2032) RPK Growth (2013-2032)

World RPK Growth

World GDP Growth

5

Turkish Aviaiton Market Growth

Source: General Directorate of State Airports Authority (DHMI).

Total Passengers (million)

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014F

29 36 44 50 54 63 65 79 89 98 111 124

4 6 10 14 16 18 21 26 30 33 38

44 25

30 34

36 38

45 44

53

59 65

73

80

0

20

40

60

80

100

120

140

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014F

Domestic International

2004 – 2014: CAGR=13%

Geographic centre of gravity of departing/arriving/connecting passengers per city

Until recently, the airline industry was

viewed as the center of Europe

Traffic as month of September; estimates for historic passenger derived from offered seats; respective centres of gravity as median of city coordinates weighted by passenger traffic

Source: Airbus Global Market Forecast 2012

Driving The Center Of Gravity Of Traffic To The South And East

After 2020, the industry will move to the center to the East

Cities,like Istanbul, Doha, Abu Dhabi and Dubai, will play a key role as

centers of the new attraction

6

-4%

2%

-2%

14%

6% 6%

4%

2%

-1%

9%

6% 5%

5% 6% 6%

-3%

15% 15%

19% 19%

13% 17%

19%

23%

27%

23% 19%

-5%

0%

5%

10%

15%

20%

25%

30%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014June

World RPK Growth THY RPK Growth

Log. (World RPK Growth) Log. (THY RPK Growth)

Aviation Market

RPK Growth %

13p

2003 – 2013 Passenger Growth Rates

Next 20 years, World passenger traffic (RPK) growth

rate %4.7 Population growth rate %0.9 Source: IATA, Airbus GMF 2013

7

76%

258%

363%

world tr tk

8

World Passenger Market Share Development – ASK

Source: World AKK from 2002-2013 is from IATA data. Airline AKK values from 2002-2012 are from IATA Wats reports. Airline AKK for 2013 are from official websites of airlines and 2014 data are forecasted based on innovata data for August 2014 given in Air Transport News.

World Largest Airlines’ Market Share in terms of ASK 2014 Jan-August Market Share

4,7% 4,4% 4,2% 3,3% 3,0% 2,7% 2,4% 2,4% 2,3% 2,2% 2,1% 1,8% 1,8% 1,7%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

UnitedAirlines

Delta AirLines

Emirates AmericanAirlines

SouthwestAirlines

ChinaSouthernAirlines

Air China Lufthansa BritishAirways

Air France ChinaEasternAirlines

QantasAirways

TurkishAirlines

CathayPacific

Airways

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 August

9

Turkish Airlines Global Passenger Market Share Development

Source: World traffic values are from IATA reports.

0,6% 0,5% 0,5% 0,6% 0,7% 0,7%

0,8%

0,9% 1,0%

1,2%

1,4%

1,6%

1,9%

0,4%

0,7%

1,0%

1,3%

1,6%

1,9%

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013F 2014F

% of World Scheduled Traffic (ASK)

% of World Scheduled Traffic (ASK)

ASK Share

5 5 6 7 9 10 11 12 14 15 16 20

26

5 5 6 7

8 10

12 13

16 18

23

28

33

10,3 10,4 11,9 14

16,9 19,7

22,6 25,1

29,1 32,7

39

48,1

59,5

-20

-10

0

10

20

30

40

50

60

70

0

10

20

30

40

50

60

70

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014B

Domestic International Total

10

Turkish Airlines Passenger Numbers

2004 – 2014: CAGR=17% X

1 m

illion

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014B

759 786 1.022 941 1,130 1,114 1,563 2,229

3,129

4,445 5,147

6.238

8,976

11.597

14.185

Transfer Passengers

International to international transfer passengers accounted for %41 of international passengers (2013).

%22

11

2000 – 2005: CAGR= 8%

2005 – 2013: CAGR=34%

X 0

00

Int'l-Int'l Transfer

24%

Int'l-Dom Transfer

10%

Int'l Direct 25%

Domestic 41%

Split of Total Passenger

* The diameter of the sphere illustrates total annual passenger number

Network Development

12

2005 14m

2006 17 m

2007 20 m

2008 23 m

2009 25 m

2010 29 m

2011 33 m

1.000

3.000

5.000

7.000

9.000

11.000

90 110 130 150 170 190 210 230 250 270

# o

f La

nd

ings

Destinations

2014 B

60 million pax

2012 39 m

2013 48 m

2003, 2004 10m

Global Rankings (Network Size)

TK is flying to more countries than

any other airline in the world

TK is the 4 th largest airline in

terms of network size

TK is flying to more international

destination than any other airline in the

world

1 4 1

13

108 Country

218 International Destinations

263 Destinations in the World

* Rankings are based on OAG data from April 2014

14

İZMİR

ESKİŞEHİR

ANKARA

KONYA

ANTALYA

DENİZLİ

BODRUM

DALAMAN

NEVŞEHİR

SİVAS

KAYSERİ

ADANA

ADIYAMAN

G.ANTEP

DİYARBAKIR

MALATYA ELAZIĞ

ERZİNCAN

TRABZON

SAMSUN

ERZURUM

KARS

AĞRI

VAN

MUŞ

BATMAN

MARDİN Ş.URFA

K.MARAŞ

SİNOP

MERZİFON

HATAY

BALIKESİR

İSTANBUL

İSTANBUL

IĞDIR

KÜTAHYA

ISPARTA

TEKİRDAĞ

KASTAMONU

BİNGÖL

ŞIRNAK

HAKKARİ

KOCAELİ

ÇANAKKALE

Destinations in Turkey

Africa

2002 THY Network (4 Destinations)

Planned (7 Destinations)

2003 - 2014 (38 New Destinations)

AFRICA

Europe

18

KATANYA

KASSEL

MUNSTER

VARNA

PISA

EUROPE

2002 THY Network (40 Destinations)

Planned (5 Destinations)

2013 - Current (40 New Destinations)

19

America

20

AMERICA

2002 THY Network (2 Destinations)

Planned (6 Destinations)

2003 - 2014 ( 8 New Destinations)

Middle East

22 Planned (2 Destinations)

2003 - 2014 (23 New Destinations)

2002 THY Network (11 Destinations)

MIDDLE EAST

Far East

24

2002 THY Network 18 Destinations

Planned (3 Destinations)

2003 - 2014 (33 New Destinations)

FAR EAST

25

Turkish Airlines’ World

Country Destination

DOMESTIC 1 45

INTERNATIONAL 107 218

EUROPE 41 101

FAR EAST 21 31

MIDDLE EAST 14 34

AFRICA 27 42

NORTH AMERICA 2 8

SOUTH AMERICA 2 2

108 COUNTRY

263 DESTINATION

26

O&D Opportunities

Africa O&D Pair

Africa – Europe 4242

Africa – Domestic 1932

Africa – Middle East 1428

Africa – Far East 1302

Africa – America 420

Africa – Total 9324

Far East O&D Pair

Far East – Europe 3131

Far East – Domestic 1426

Far East – Africa 1302

Far East – Middle East 1054

Far East – America 310

Far East - Total 7223

Middle East O&D Pair

Middle East – Europe 3434

Middle East – Domestic 1564

Middle East – Africa 1428

Middle East – Far East 1054

Middle East- America 340

Middle East – Total 7820

67 84 83 105 109 124 138 159 181 204

349

17 18 17

18 20 29

35 36

43

54

79

1 1 2

4 4 5

6 7

9

9

7

85 103

102 127 133

158 179

202 233 267

435

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014B 2021

Cargo Wide Narrow

%24 %1 %15 %5 %19

%13 %15 %14 %25 %58

Fleet Development

27

Seat Capacity

2000 2005 2010 2015 2020 CAGR

12k 15k 28k 51k 79k 14 %

Fleet Group A/C Orders

Wide Body A330 13

B777 18

Narrow Body

A320 CEO/NEO 117

B737 NG/MAX 95

B737-900ER 5

Total 248

248 A/C Orders

Cargo Development

Leading cargo carrier in total export and import

cargo in Turkey.

As from April 2014, operates 49 destinations with its 3 A310-300 and 6 A330-200F freighters.

In 2013, 565,000 ton cargo were carried.

28

6 6th largest cargo

carrier of Europe in total carried cargo

ton km

2005 2006 2007 2008 2009 2010 2011 2012 2013

115 126 145 161 201

274 334

422

518

30 33 39 38

36

39

37

40

47

Cargo (ton)

Domestic International22%

Cargo(ton) 2013 July 2014 July

Domestic 27,099 29,809

International 284,973 349,164

10%

22%

X1

00

0

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 6M 2013 6M 2014

09

:08

09

:15

10

:21

10

:31

11

:13

11

:40

11

:39

12

:02

11

:40

12

:14

12

:40

12

:28

12

:55

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 6M 2013 6M 2014

94

5

1.0

16

1.0

94

1.2

71

1.3

23

1.5

16

1.6

06

1.6

44

1.7

01

1.8

26

2.0

43

2.0

84

1.0

67

1.0

89

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 6M 2013 6M 2014

10

23

9

10

95

6

11

12

1

12

80

7

12

95

1

14

07

2

15

26

9

17

11

9

17

87

6

19

10

8

23

16

0

20

98

9

24

06

6

29

Operating Efficiency

Passenger per Employee

* Technic A.S., HABOM ve MNG Technic are included.

Average Daily Flight Utilization (hrs)

2%

Number of Personnel* 14,6%

3,6%

Global Rankings (Quality)

4 star airline in all services

Catering

The best airline for in-flight food

(according to Skyscanner)

Winner of Air Transport World-Market

Leadership Award’11

Market Leader

1 Best Airline in Europe

Global Rankings (Quality)

31

4 year in a row BEST AIRLINE IN EUROPE (2014)

Airline of the Year Award (CAPA ,2013)

Best Business Class Catering in the World

Best Business Class Catering in Lounge in the World

Sponsorships and Commercials

32

33

CIP Lounge

Star Alliance Member

34

35

36

Geographical Advantage

Within narrow body range;

70% of international destinations,

More than 55 countries

* Size of bubbles shows the traffic volume

Advantages / Geographical Location

The advantage is to become a global hub of Istanbul

Istanbul is in the middle of Europe, Middle East and Asia regions with high volume of traffic and growth rate.

37

Top 20 busiest airport (International Traffic)

~%17

Detour distance advantage from Europe

~%10

~%6

0,00

5,00

10,00

15,00

0 100 200 300 400 500 600 700 800

Unit Cost– Flight Time Change

CA

SK

1 2 3 4 5 6 7 8 9 10 11 12 Hour

38

İstanbul

Third Airport

3rd Bridge

Atatürk International Airport

Black Sea

Sabiha Gökçen

Istanbul

39

76.5 km2 Area

500 Aircraft Park Positions

6 Runways

4 Terminals

150 million

PASSENGERS CAPACITY (Phase4)

A candidate for 3rd Biggest (After Phase 1) & Biggest (After All Phases) in the World

3rd Airport In Istanbul

40

Taking Out Non-physical Barriers

• Maximizing the operations, services and limited recourses in member

countries

• Economies of Scale : The more the supplies - The less Costs

• Increasing propensity to travel within the member states

Reduce Non-infrastructural Barriers

• Remove frequency and capacity restrictions

Visa Requirements

• Transit travel via Turkey: NO VISA required for available Schengen, UK

and/or USA visa.

• E-visa is ready within 2 hours after application

• NO VISA required for stop-overs up to 72 hours.

• Ministry of Foreign Affairs of Turkey has been striving in principle, for

reciprocally exemption of visas between Turkey and other countries.

Increasin

g Trade an

d Travel b

etween

OIC

C

ou

ntries

Barriers in Member States & Recommendations