Investor Presentation March 2009 A Confidential Presentation
Senior Management Team � Rupert Duchesne President & Chief Executive Officer � David Adams Executive Vice President & Chief Financial Officer � Patricia Moran Head of Investor Relations 2 GROUPE AEROPLAN
Forward-Looking Statements Certain statements in this presentation may contain forward-looking statements. These forward-looking statements are identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. Such statements may involve but are not limited to comments with respect to strategies, expectations, planned operations or future actions. Forward-looking statements, by their nature, are based on assumptions and are subject to important risks and uncertainties. Any forecasts or forward-looking predictions or statements cannot be relied upon due to, amongst other things, changing external events and general uncertainties of the business and its corporate structure. Results indicated in forward-looking statements may differ materially from actual results for a number of reasons, including without limitation, dependency on top four commercial partners that purchase loyalty marketing services, including Aeroplan Miles, Air Canada or travel industry disruptions, Air Canada liquidity issues, airlines industry changes and increased airline costs, reduction in activity, usage and accumulation of Aeroplan Miles, retail market/economic downturn, greater than expected redemptions for rewards, industry competition, supply and capacity costs, unfunded future redemption costs, failure to safeguard databases and consumer privacy, consumer privacy legislation, changes to the Aeroplan and Nectar Programs, seasonal nature of the business, other factors and prior performance, regulatory matters, VAT appeal reliance on key personnel, labour relations and pension liability, technological disruptions and inability to use third party software, failure to protect intellectual property rights, currency fluctuations, interest rate and currency fluctuations, leverage and restrictive covenants in current and future indebtedness, dilution of Groupe Aeroplan shareholders, uncertainty of dividend payments, level of indebtedness-refinancing risk, managing growth, as well as the other factors identified throughout the MD&A. The forward-looking statements contained in this discussion represent Groupe Aeroplan’s current expectations as of February 26, 2009, and are subject to change. However, Groupe Aeroplan disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required under applicable securities regulations. Dollar amounts are expressed in millions of Canadian dollars, except “Per Share” amounts, or unless specified otherwise. 3 GROUPE AEROPLAN
About Groupe Aeroplan Global leader in loyalty management with a presence on three continents � 25 years operating experience � Financial highlights in 2008 � • Gross billings of $1.4 billion • Adjusted EBITDA of $317 million • Free cash flow of $301 million • Cash balance of $665 million � Widely held and publicly traded company on the TSX (TSX: AER) • Market capitalization of approximately $2 billion • ACE Aviation sold remaining interest on May 28, 2008 � Successfully converted to a corporation in June 2008 4 GROUPE AEROPLAN
Major Milestones Voted World’s Best Aeroplan FFP by OAG formed (award also rec’d IPO of for 2002 ) as stand-alone Aeroplan Introduction entity of Income Fund of ClassicPlus Air Canada ($2B market cap) Flight Rewards 1984 1991 2001 2002 2003 2004 2005 2006 2007 2008 2009 Completed integration Conversion of of Canadian Plus Aeroplan Income Fund members 1984 - 1990 to a Corporation (Groupe Aeroplan Inc.) 5 GROUPE AEROPLAN
Groupe Aeroplan Overview LMG (60% ownership) LMG Insight & Programs / Services Communication (Air Miles Middle East) 1984 2002 2001 2007 Established Travel, financial Consumer goods, Consumer goods, Data analytics with services, hotels, gas grocery, utilities, food apparel, financial worldwide applicability Key Sector Focus stations, grocery & & beverage services consumer goods 6 GROUPE AEROPLAN
Attractive Business Model Earning - Miles “Cash Inflow” Member buys Miles Commercial products deposited in partners buy miles from or services & member’s Groupe “earns” miles account Aeroplan Redeeming - Miles “Cash Outlfow” Member Groupe Member redeems miles Aeroplan enjoys buys product with Groupe rewards or service from Aeroplan partners 7 GROUPE AEROPLAN
Investment Highlights
Investment Highlights � Global leader in loyalty management with a growth platform • Aeroplan Program is Canada’s premier loyalty marketing program • Nectar Program is UK’s largest coalition loyalty marketing program � Diversified and recurring revenues with long-term agreements • Aeroplan and Nectar Programs are partnered with over 85 leading companies representing over 170 brands � Predictable and flexible business model • Significant control over the value and mix of rewards available for redemption � Track record of strong free cash flow generation • Generated $301 million of free cash flow in 2008 � Strong cash position • Cash, cash equivalents & short-term investments of $665 million as at December 31, 2008 � Committed to investment grade profile 9 GROUPE AEROPLAN
Global Leader in Loyalty Management � Aeroplan Program is Canada’s premier loyalty marketing program with 25 years of experience and more than 4 million active members � Nectar Program is UK’s leading coalition loyalty program with more than 10 million active members � Rewards Management Middle East is the operator of Air Miles program in the fast-growing Middle Eastern markets LMG Insight & Communication provides analytical services to retailers and � their suppliers using leading edge technology with worldwide applicability (Air Miles Middle East) 10 GROUPE AEROPLAN
Strong Growth Platform � Complementary businesses which leverage retail, travel, financial and customer data analytics services expertise across three continents Owner of Air Miles trademark in a number of jurisdiction, including � Canada � Track record of launching new programs with international expansion • Aeroplan: leading loyalty program with strong travel and financial sector expertise and potential to further broaden its partner base • Nectar: leading coalition program with strong retail expertise – Potential to add key partners in important verticals (airlines and financials) • LMG Insight & Communications: I&C technology and service offering with worldwide applicability • Air Miles Middle East: Further expansion in the fast growing Middle East market by attracting partners in key market categories � Provides platform for other international operations and opportunities 11 GROUPE AEROPLAN
Loyalty Marketing Partner of Choice � 85+ partners representing 170+ brands (Air Miles Middle East) 12 GROUPE AEROPLAN
Diversified Revenue Base � The LMG acquisition allowed Groupe Aeroplan to diversify its revenue base, expand geographically and gain retail expertise • Ability to leverage cross sector know-how: financial, retail and travel • Reduced exposure to Air Canada with gross billings representing 17% in 2008 from 25% in 2007, and reduced dependence on others Gross Billings Break Down 2007A 2008A Pre LMG Acquisition Post LMG Acquisition Other Other 11% 18% CIBC Air Canada 38% CIBC Sainsbury’s 25% 52% 17% Amex Air Canada Amex 12% 17% 10% Gross Billings: $952M Gross Billings: $1,421M 13 GROUPE AEROPLAN
Selected Long-Term Agreements CIBC Sainsbury’s American Express � Long standing relationship � Represents over 17% of � Agreement entered into in since 1991 2008 gross billings 2003 for co-branded charge cards and � 10-year agreement � Strategic partnership membership reward expiring in 2013 with agreement conversions renewal option � Minimum annual gross � 10-year agreement � Largest premium card billings expiring in 2014 with issuer in Canada renewal option 14 GROUPE AEROPLAN
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