Operating segments

The Group has four reportable segments, as described below, which are the Group’s strategic business units. The strategic business units offer different products and services, and are managed separately because they require different technology and marketing strategies. For each of the strategic business units, the Group’s General Director reviews internal management reports on at least a quarterly basis. The following summary describes the operations in each of the Group’s reportable segments:

• Airline — domestic and international passenger and cargo air transport and other airline services;
• Catering — includes preparation of food and beverages for air travel;
• Hotels — includes operating a hotel;

There are also other operating segments. However, none of these segments meet any of the quantitative thresholds for determining reportable segments in 2012 and 2011. For the segment Airport terminal — Sheremetyevo-3 terminal which was disposed in 2011 comparative information is presented.

Information regarding the results of each reportable segment is included below. Performance is measured based on segment sales revenue and operating profit, as included in the internal management reports that are reviewed by the Group’s General Director. Segment sales revenue and operating profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries. Inter-segment pricing is determined on an arm’s length basis.