OREANDA-NEWS. November 20, 2009. Aeroflot Group reported a consolidated operating update for 10M09 in which passenger turnover was 24.9bn p-km. The 10M09 figure reflects a -6.3% YoY drop, though the numbers for October show a 1.6% YoY gain, reported the press-centre of OTKRITIE Financial Corporation.

View: While Aeroflot's turnover dynamics have been gradually improving since April, October was the first month this year to post positive YoY growth. These positive dynamics are mainly attributable to a low 4Q08 base. For FY09 we had projected a 10% decline in Aeroflot's turnover, which now seems to be a bit pessimistic.

Valuation and Action: Aeroflot trades on a 2009E EV/EBITDA of 8.5x, which is in line with foreign airlines. In our view, Aeroflot is a defensive asset since the company is less dependent on exchange rate fluctuations: 75% of its revenue and 50% of its costs are dollar-denominated.