,

MANAGEMENT REPORT 2009

BRUSSELS SOUTH CHARLEROI AIRPORT S.A.

ORDINARY GENERAL MEETING, 18/06/2010

2

The BSCA Board of Directors is made up as follows:

Edmée DE GROEVE1

Member of the Executive Committee

President

Dominique HAUSMAN2

Member of the Executive Committee

Vice-president

Marcel BUELENS3

Member of the Executive Committee

Managing Director

Alain BELOT

Director

Carlos BOURGEOIS4 Director

Marc DENEVE

Director

Antonio DI SANTO

Director

1 The Board of Directors confirmed Madame Edmée DE GROEVE’s resignation when it met on

29th October 2009. 2 Since Madame Edmée DE GROEVE’s resignation on 29th October 2009 and in accordance

with article 14 of BSCA’s by-laws, Monsieur Dominique HAUSMAN has taken on the role of

acting president of the Board of Directors 3 The Board of Directors confirmed Monsieur Marcel BUELENS’ resignation when it met on 8th

June 2009. 4-5-6-7 The General Assembly of 10th December 2009 confirmed the appointment of Messieurs

Carlos BOURGEOIS, Christophe JONLET, Enrico MARCHI and Paolo SIMIONI as Directors.

1/ The board of directors

3

Jean-Pol FONTAINE

Director

Jean-Marie HOSLET

Director

Christophe JONLET5

Director

Laurent LEVEQUE

Director

Enrico MARCHI6

Director

Pierre ROMBAUX

Director

Paolo SIMIONI7

Director

Philippe SUINEN

Director

Luc VUYLSTEKE

Director

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Since the Extraordinary General Meeting of 10th December 2009

SHAREHOLDERS

NUMBER OF SHARES OWNED

Category A

WALLOON REGION

loco SOGEPA

3,450

SOWAER 2,815

SAMBRINVEST S.A. 2,390

IGRETEC S.C. 289

Category B

SABCA S.A. 83

Category C

BELGIAN AIRPORT s.a 3,450

Number of registered shares 12,477

2/ The shareholfders

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3.1 Key events of 2009

3.1.1 New shareholders

2009 saw negotiations with the Save group and the Holding

Communal continue.

On 5th June 2009, the shareholders agreement with Belgian

Airport, which includes the Holding Communal and Save, was

signed.

The transaction was completed on 10th December 2009 with the

arrival of new directors representing Save (2) and the Holding

Communal (2).

This extension of the Board was accompanied by the creation of

a strategic committee to complement the Management

Committee and the Remuneration Committee which were

already in place.

This brought Belgian Airport’s stake to 27.66%.

3.1.2 North taxiway and runway extension

Work on the taxiway continued and is expected to be

completed on 2nd July 2010.

As far as the runway extension is concerned, the new

government decided to reduce this from 3,300m to 2,950m. In

this context, a new procedure to secure a permit must be re-

launched.

3/ Summary of events during the financial year 2009

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3.2 Aviation activities

Commercial income from airline companies (refuelling, excess

baggage, ticket sales etc.) came to €3,480, equivalent to

€1.77/departing passenger.

2009 saw a 33% increase in passenger numbers compared to 2008 and

the launch of 25 new routes. Ryanair, Jetairfly and Wizzair continued to

grow by consolidating their presence at Brussels South Charleroi airport.

Two new clients were won over by the airport: Airarabia Maroc and Air

Méditerranée. In May, Air Arabia began by offering 5 flights a week to

Casablanca, a route (still) offered by Jet4you since 2006. The arrival of

Air Arabia represents a step in a new direction, offering “full service at a

competitive price”. Air Méditerranée was not as successful as hoped

for, and ceased operations at the end of the summer.

10 ad hoc/diverted flights were recorded for, among others, Brussels

Airlines, British Midlands and Swiss.

On 27th January, BSCA was awarded ILS category III certification. This

was a major achievement, as in 2008 the airport experienced more

than 20 days during which 102 flights had to be redirected to other

airports. January was also a memorable month, as 17.3% of the total

number of passengers carried across the Belgian market travelled by

Brussels South Charleroi – a record high.

In 2009 Ryanair began flying to 20 new destinations and also changed

flight frequencies, mainly by increasing them. The new destinations

were: Agadir, Alghero, Ancona, Bordeaux, Bratislava, Brindisi, Cagliari,

Edinburgh, Figari, Gran Canaria, Lanzarote, La Rochelle, Oslo, Palma de

Mallorca, Reus, Santander, Stockholm, Tenerife, Trapani and Trieste.

Wizzair launched just one new route in 2009 to Prague, but also

increased the number of flights to Budapest.

Flyonair resumed flights to Pescara and Sicily in summer 2009.

Jetairfly launched 3 new destinations (Djerba, Monastir and Murcia. The

company experienced its best occupancy rates in March, reaching

85%. This trend was set to continue throughout 2009.

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In terms of airline companies’ market share, the following changes

occurred:

Ryanair 2008: 85.8% 2009: 82.5%

Wizzair 2008: 9.1% 2009: 9.7%

Jetairfly 2008: 1.2% 2009: 4.6%

Jet4you 2008: 3% 2009: 1.7%

Airarabia 2008: - 2009: 0.9%

Flyonair 2008: 0.3% 2009: 0.2%

2004

2005

2006

2007

2008

2009

Number of

passengers

2 034 797

1 873 349

2 166 360

2 458 255

2 957 026

3 937 187

Change

65 952

61 212

66 480 70 725 79 487

81 726

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3.3 Commercial income

Our non-aviation commercial income increased by 41% compared to

2008.

Our 4,000 space car parks are all easily accessible and close to the

terminal. On a number of occasions, when visitor numbers were high,

the economy car park – slightly further away – was used. Soon a long-

stay car park with 1,470 spaces, will be available for those wishing to

stay longer and looking for something closer.

The shuttle bus to Brussels has enjoyed growing success. Given the high

passenger numbers, in collaboration with our operator, we have

decided to put on a bus every half hour.

As far as horeca services are concerned, there are a number of outlets

available for our passengers offering a wide range of products.

2009 also saw growth in car hire services, with 5 operators in total.

In the context of serving our passengers, we have increased the

number of Internet points (terminals and areas). As soon as these were

installed, we immediately noticed a very pleasing rise in use.

To offer our customers new services, in June 2009, we opened a service

station with a small convenience store open until midnight 7 days a

week and a carwash.

The travel agency, bookshop, duty free, florist and toyshop complete

the range of outlets now open.

The airport has grown and developed its welcome desk, to greet and

inform passengers as well as to market our products in the BSCA

colours.

During the month of May 2009, BSCA carried out a survey among its

passengers, to assess satisfaction with staff as well as the quality of

services offered.

The main thing that came out of this survey was that our staff are

appreciated for their pleasant and helpful attitude, as well as the

speed at which they do their job.

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In terms of the services offered, travellers are particularly impressed

with the punctuality and cleanliness of the shuttle bus to Brussels

(Brussels City Shuttle).

The restaurants and bars scored average results, with welcoming staff

and a reasonably varied range of products. Several areas for

improvement are being looked into.

In order to continue to improve our services for passengers, BSCA will

carry out this kind of survey several times a year.

Income from the different retail outlets represent a total revenue of

€15,304,813, equivalent to €7.77 per departing passenger.

The most significant income is generated by parking activities, shuttled

buses to Brussels and horeca services.

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3.4 Human resources

For 2009, the number of BSCA employees rose by 71 people between

1st January and 31st December 2009.

This represents a total of 366.93 full-time equivalents as of 31st December

2009.

The majority of these jobs are on an open-ended contract basis.

BSCA currently has more office workers than manual workers (55%

compared to 45%).

67% of employees are male compared to 33% female.

BSCA has a young population; our average age is 32.

Absenteeism remains a day-to-day task.

We have introduced a new procedure for accidents in the workplace

which is already proving to be a success.

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3.5.1. Training

BSCA places a great deal of importance on training. This

includes operational training as well as training focusing more on

behaviour.

In 2009, 18,208 training hours were offered.

3.5.2. Business culture project

During the 1st half of 2009, the BSCA management defined the 7

values for each department, defining guidelines for how

members of staff are expected to behave.

During the second half of 2009, the internal communication

campaign was launched:

- using posters showing the values in all departments, - by means of briefing sessions to reach all employees. The values and behaviour guidelines are now included in

reference material given to every member of staff.

3.6 Management of environmental measures by the SOWAER

Spurred on by the determination of the Walloon Government and its

supervisory minister, André Antoine, as well as by the legal context

established in 2005, the Société Wallonne des Aéroports (SOWAER) has

developed and improved the way it handles residents’ cases when it

comes to managing environmental procedures around the two

Walloon airports.

Lastly, the ongoing monitoring of sound levels, respect for noise-

reduction measures and information given to residents remain the

continuing essential tasks of the SOWAER.

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Managing environmental measures

3.6.1 Purchase of buildings in zones A’ and B’ of the P.E.B. and soundproofing in zones A’ to D’

Within the framework of the agreement made with the Walloon

Region, developed and undeveloped buildings in zones A’ and

B’ of Charleroi’s P.E.B. were purchased by IGRETEC on the

SOWAER’s behalf.

As of 31/12/2009, 152 developed buildings had been purchased

and 1,689 buildings were soundproofed.

The statistics provided by the SOWAER are as follows:

PEB zones A’ B’ C’ D’ Total

Charleroi – completed

- soundproofing

- purchases

4

73

79

79

350

0

1,256

0

1,689

152

Charleroi – in progress

- soundproofing

- purchases

8

38

53

63

309

0

757

0

1,127

101

3.6.2 Relocation grants for tenants of buildings in Charleroi’s zones A’ and B’.

As of 31st December 2009, 24 relocation grants were paid to

tenants who have moved out of zones A’ and B’.

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3.6.3 Compensation for commercial difficulties in zones A’ and B’ of the P.E.B

As of 31st December 2009, 5 compensation payments were

made to people carrying out professional activities in zones A’

and B’ who moved away or terminated this activity.

3.7 Board of Directors and Management Committee

The Board of Directors confirmed the resignation of Monsieur Marcel

BUELENS when it met on 8th June 2009.

The Board of Directors confirmed the resignation of Madame Edmée DE

GROEVE when it met on 29th October 2009.

Since the resignation of Madame Edmée DE GROEVE on 29th October

2009, and in accordance with article 14 of BSCA’s by-laws, Monsieur

Dominique HAUSMAN has taken on the role of acting president of the

Board of Directors.

The General Assembly of 10th December 2009 confirmed the

appointment of Messieurs Carlos BOURGEOIS, Christophe JONLET,

Enrico MARCHI and Paolo SIMIONI as Directors.

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All of the amounts given in this section are in THOUSANDS OF EUROS, unless

otherwise stipulated.

4.1 Profit and loss

4.1.1. Sales and services

2009 sales were clearly affected by the increase in passenger

numbers recorded during this period (+ 33.1%).

The main sources of this rise are the income from handling

activities (+ 46.4%), income from trade outlets (+ 37.8%) and the

income that we receive from the airline companies, mainly

ticketing, refuelling and excess baggage (+17.0 %).

The total value of sales and services was EUR 67,533 for 2009,

compared to EUR 55,247 in 2008, so an increase of 22%.

4.1.2. Cost of sales and services

The entry for “Miscellaneous goods and services” rose to EUR

37,444 compared to EUR 33,281 in 2008. This is the result of the

increase in costs directly linked to the number of passengers, as

well as the running costs of BSCA Security, which represent EUR

13.523 compared to EUR 9,247 for 2008.

To cope with the increase in passenger numbers, extra staff were

recruited. This resulted in a 20% rise in staff costs, which went up

to EUR 18,754 compared to EUR 15,604 in 2008.

Capital allowance rose to EUR 1,780 for 2009 compared to EUR

1,296 in 2008. This increase can be explained by the purchase of

the runway equipment needed to cope with the extra planes.

The total for the “Cost of sales and services” was EUR 60,474

compared to EUR 52,796 in 2008.

4/ Annual accounts

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4.1.3. Financial results Interest from financial income fell dramatically (-78 %), largely

because of the significant reduction in the rates for our fixed

term investments.

4.1.4. Profit before tax

The profits for the year before tax reached EUR 6,860 compared

to EUR 2,695 in 2008. Taxes for the period came to EUR 2,434.

4.1.5. Profit to be allocated

The profits from the period to be allocated came to EUR 4,445

compared to EUR 1,915 in 2008. At the General Meeting, the

Board of Directors proposed a dividend of EUR 387. The total to

carry over at the end of the period was EUR 12,194.

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4.2 Balance sheet

4.2.1. Assets

Fixed assets rose from EUR 18,182 in 2008 to EUR 19,064 in 2009.

This increase can be explained by the acquisition of new

handling equipment.

Accounts receivable went from EUR 6,242 to EUR 8,044, following

the rise in our sales and services.

Short-term investments and cash assets also increased, rising

from EUR 12,972 in 2008 to EUR 18,499 in 2009.

4.2.2. Liabilities

Equity stood at EUR 20,703, compared to EUR 16,682 in 2008.

Debts older than one year mainly represent the long-term part of

the funding for the fuel park.

Trade debts rose by more than 28%, going from EUR 11,541 to

EUR 14,813 following the growth in activities.

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5.1. Development of air activities

At the beginning of the year, we saw the realisation of significant

developments in the airline activities, with Ryanair announcing the

arrival of 4 additional airplanes and Jet Air confirming their second as of

1/4/2010.

5.2. Decision to proceed with the extension of the terminal

For BSCA, these commercial developments are synonymous with a

significant increase in traffic, which basically comes down to complete

saturation of the current terminal. To deal with this, it has been decided

that an extra departure lounge with 3 boarding gates should be built.

Work should begin in November 2010, and is due to be operational in

April 2011.

5.3. Opening the long-stay car park

Still thinking about this saturation, at the beginning of May, an extra car

park with 1,700 spaces was opened. This is BSCA’s first significant

investment using equity.

5.4. Volcano in Iceland

Like the rest of Europe’s air industry, BSCA was affected by the eruption

of the Icelandic volcano in mid-April. The consequences for BSCA were

7 days without any flights and an estimated loss of €1M.

5.5. Promocy

On 31/03/2010, BSCA gave up its 50% share in Promocy. This transaction

was recorded as historical.

5/ KEY EVENTS AFTER THE END OF THE YEAR AND SITUATIONS THAT MIGHT HAVE A SIGNIFICANT IMPACT ON THE COMPANY’S DVELOPMENT

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N/A.

N/A.

6/ Research and development

7/ Indications of the existance of a branch

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BSCA has not used any financial instruments.

9.1. Risks associated with appeals against permits

On 1st February 2005, the City of Charleroi granted the SOWAER an environment permit.

On 14th February 2005, the civil service representative and the technical representative granted the single permit for the initial investment phase for Charleroi airport.

After exhausting all internal appeal options, the residents’ association submitted an appeal to suspend and cancel the permit to the Council of State. The suspension appeals were rejected by the Council of State on 17th January 2006. The cancellation appeals are still underway as of 31st December 2009.

9.2. Risks associated with civil appeals made by residents

A number of residents have initiated legal proceedings against BSCA and the Walloon Region in November 2003 to win compensation for damages caused by mistakes made by both BSCA and the Walloon Region by effectively authorising flights producing sound levels above permitted thresholds, as well as flights breaching the provisions of the decree of 23rd June 1994 relating to airport opening hours.

A ruling by the Charleroi Tribunal de Première Instance made on 30th March 2004 banned (with penalties) movements breaching article 1 bis of the decree of 23rd June 1994, and called for a legal assessment to determine instances where limits are exceeded for the residents concerned.

On 1st February 2005, the Mons Court of Appeal reformed the judgement, confirmed the legal assessment, and asked preliminary

8/ Financial instruments

9/ Description of the main risks and uncertainties

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questions in advance of the Arbitration Court, as soon as, as of 1st April 2004, the decree had been changed to reduce certain disproportionate restrictions relating to how the airport is run.

The Arbitration Court rightfully confirmed that the decree of 1st April 2004 did not breach the constitution.

After the current assessment is completed (the consultant has submitted a preliminary report to the parties), the case will be argued once again and examined in terms of the damages claimed by the residents.

The consultant’s report, whose conclusions were in the BSCA and Walloon Region’s favour, were communicated to the Charleroi Tribunal de Première Instance de Charleroi on 23rd January 2008.

This case did not see any developments during 2009.

9.3. Decontamination of the South fuel station

In accordance with a royal decree issued by the Walloon Region, clearance must begin when activities at the South station come to an end. This operation must be planned in the next few months.

9.4. Dependency on a single main client

RYANAIR is currently BSCA’s main client and generates over 80% of the passengers. This presence could discourage other companies from working at Charleroi.

However, we should not forget the growing success of the companies WIZZ Air and Jet 4 YOU as well as the arrival of Jet Air Fly, which has seen a fall in the proportion of RYANAIR passengers.

9.5. Risk associated with the existence of a consultancy contract

A consultancy contract is currently an issue in that the legislation covering public contracts has not been respected, making this contract inapplicable in terms of its financial implications. BSCA feels that there is no need to make provisions for this contract.