Groupe Aeroplan Inc. Reports 2009 Second Quarter Results
Business shows resiliency through challenging economic times
MONTREAL, Aug. 14 /CNW Telbec/ - Groupe Aeroplan Inc. (the "Corporation")
(TSX: AER), today reported its 2009 second quarter results.
Second Quarter 2009 Operating Highlights- Gross billings, on a constant currency basis, down by just under 3%
compared to the second quarter of 2008
- Redemption activity in all programs within normal seasonal levels and
redemption costs in Canada in line with annual outlook and historical
second quarter trends
- Execution of international expansion plans, as evidenced by the planned
launch of a coalition loyalty program in Italy in 2010"While Groupe Aeroplan has shown resiliency in the face of lower consumer
spending, we believe the uncertainty surrounding Air Canada has had an
additional impact on our Canadian business, ultimately influencing the average
per card spend in our financial partner portfolio, which was also impacted,
both by a decline in business travel and the recession," said Rupert Duchesne,
President and Chief Executive Officer. "However, this was partially mitigated
by the fact that members in all of our programs were active in both
accumulation and redemption activities and we continue to execute against our
growth strategy with the announcement of significant milestones, such as the
successful Homebase partnership in the UK and the launch of a coalition
loyalty program in Italy.
"Assisting Air Canada by loaning the airline $150 million was the right
thing to do, both from a commercial perspective and for the benefit of all of
our stakeholders," added Duchesne. "Now that their liquidity situation has
been stabilized, they can focus on their plans to reposition the airline and
strengthen their customer value proposition. A stronger Air Canada, a key
strategic partner, means our Canadian program will be in a better position
going forward."
"Groupe Aeroplan has a healthy balance sheet and strong liquidity
position," said David Adams, Executive Vice President and Chief Financial
Officer. "Our strong cash generating ability and underlying fundamentals
enabled us to refinance our $650 million credit facilities and access credit
markets by raising $200 million of series 1 notes in this extremely tight
credit environment, while maintaining our investment-grade credit rating."
Second Quarter 2009 Financial Highlights- Gross Billings of $337.8 million, after a negative currency impact of
$9.3 million
- Revenue of $333.5 million, after an negative currency impact of
$8.0 million
- Operating income of $37.5 million
- Net earnings of $26.7 million
- Adjusted EBITDA of $70.6 million(*)
- Adjusted net earnings of $52.3 million(*)Financial Performance (compared to Second quarter of 2008)Gross Billings
--------------Consolidated gross billings for the three months ended June 30, 2009, on
a constant currency basis, declined by $10.6 million or just under 3.0%,
compared to the second quarter of 2008. Including the currency impact, gross
billings amounted to $337.8 million compared to $357.9 million, representing a
decrease of $20.1 million or 5.6%, with approximately 47% relating to the
devaluation of the GBP sterling compared to the Canadian $, affecting the
translation of our foreign operations.Revenue
-------Revenue amounted to $333.5 million for the three months ended June 30,
2009 compared to $336.7 million for the three months ended June 30, 2008,
representing a decrease of $3.2 million or just under 1.0%.Operating Income
----------------For the second quarter, operating income, before amortization of
accumulation partners' contracts and technology, amounted to $58.0 million
compared to $69.5 million for the three months ended June 30, 2008,
representing a reduction of $11.5 million. The variance is mostly attributable
to an increase in the Average Cost of Rewards per Mile redeemed under the
Aeroplan program and a marginal decrease in selling, general and
administrative expenses, compared to the second quarter of 2008.
The increase in Average Cost of Rewards per Mile redeemed during the
quarter reflects the redemption mix of rewards, including the increase in the
cost of Star Alliance redemptions due to fluctuations of the US$, the
underlying distances of itineraries and more expensive class of service of air
rewards redeemed, and marginally, by unit cost increases related to reductions
in capacity by the airline.Net Earnings
------------Net earnings of $26.7 million for the quarter reflected reduced margins,
driven by a higher Average Cost of Rewards per Mile redeemed for the quarter,
a higher income tax expense related to the Canadian operations as a result of
the conversion to a corporation in the second quarter of 2008, partially
offset by non-operating items related the Corporation's financial structure
and foreign exchange fluctuations.Liquidity
---------At the end of the second quarter 2009, the Corporation had $590.0 million
of cash and cash equivalents and $34.6 million of short-term investments, for
a total of $624.6 million including the Aeroplan Canada redemption reserve of
$400 million.Adjusted EBITDA(*) and Free Cash Flow(*)
----------------------------------------Adjusted EBITDA for the three months ended June 30, 2009 amounted to
$70.6 million, which represents 20.9% of Gross Billings, compared to $81.9
million generated during the second quarter of 2008 or 22.9% of Gross
Billings.
Free cash flow amounted $90.8 million, compared to $43.6 million for the
three month period ended June 30, 2008, mainly as a result of:- cash generated from operations of $29.7 million, including the effect
of the reversal of the temporary acceleration of payment terms, related
to Air Canada, partially offset by lower net earnings for the quarter
of $4.7 million;
- lower capital expenditures of $0.6 million incurred during the second
quarter of 2009, and
- a reduced level of dividends of $17.0 million paid during the second
quarter of 2009 compared to the second quarter of 2008, resulting from
the conversion to a corporation on June 25, 2008.Outlook for 2009
Current market conditions, with reduced consumer expenditures and
business travel, make it difficult to predict 2009 performance. Assuming
current economic conditions prevail and absent out of the ordinary events,
affecting the travel industry in particular, Groupe Aeroplan would expect to
see a decline of 2 - 4% in consolidated gross billings, for the full year
2009, as compared to 2008. In addition, for 2009, the Corporation expects the
Average Cost of Rewards per Mile Redeemed, under the Aeroplan Program, to
remain in the low nineties for the remainder of the year and not to exceed
0.95 cents on an annual basis throughout 2010, with gross margin in the
Canadian segment remaining relatively stable.
The outlook provided constitutes forward-looking statements within the
meaning of applicable securities laws and should be read in conjunction with
the section below entitled "Caution Concerning Forward-Looking Statements".
Corporate DevelopmentsDividend
--------The Corporation announced today that the Board of Directors declared a
quarterly dividend of $0.125 per common share, payable on September 14, 2009
to shareholders of record at the close of business on August 28, 2009.Air Canada Financing
--------------------On June 29, 2009 Groupe Aeroplan announced that Aeroplan Canada Inc. and
Air Canada agreed to immediately unwind the acceleration of payment terms in
effect as a result of an agreement entered into in November 2008. Concurrent
with the repayment by Air Canada of all remaining amounts previously
accelerated, Aeroplan agreed on June 29, 2009, to make available to Air
Canada, on a secured basis, a revolving loan to replace the existing
acceleration of payments arrangement. The loan was in an amount equal to the
aggregate of the previous 60 days accumulated purchases by Aeroplan of reward
seats from Air Canada, up to a maximum of $100 million, and was repaid in full
on July 30, 2009.
On July 30, 2009 Aeroplan Canada Inc. entered into a credit agreement
with Air Canada and other parties pursuant to which it advanced $150 million
of a total of $600 million to the airline for a 5-year term, repayable
starting in August 2010 and ending in July 2014. As part of this credit
agreement, Aeroplan and Air Canada agreed to mutually beneficial commercial
terms, none of which negatively affect the availability of capacity for
redemptions and pricing applicable to the purchase of Aeroplan Miles or reward
travel seats.Launch of Coalition Loyalty Program in Italy
--------------------------------------------On June 30, 2009, Groupe Aeroplan announced that it will launch a
coalition loyalty program in Italy in 2010. The program is modeled on its
successful Nectar program in the UK. Groupe Aeroplan will have a majority
participation of 75% in the new Italian program.Credit Facilities
-----------------On June 12, 2009, the Corporation announced that it concluded a renewal
of its $650 million credit facilities with its lending syndicate. At June 30,
2009, $500 million of the credit facilities were drawn and $150 million
remained committed and available.
The new secured credit facilities, which consist of a bridge loan of $100
million, with its maturity under certain conditions, extending until June 19,
2010, at the option of Groupe Aeroplan; as well as a term facility of $300
million and a revolving facility of $250 million, both maturing on April 23,
2012, rank pari passu with the Senior Secured Notes Series 1 due in 2012,
issued by the Corporation in April 2009.Labour Relations
----------------On May 22, 2009, Groupe Aeroplan announced that following the outcome of
mediation at the Canada Industrial Relations Board, Aeroplan Canada Inc., Air
Canada and the CAW Local 2002 reached an agreement on the transition of
contact centre agents to Aeroplan. The transfer of the 805 contact centre
employees was fully effected on June 14, 2009.Issuance of Senior Secured Notes
--------------------------------In April 2009, the Corporation issued an aggregate of $200 million
principal amount of 9% Series 1, Senior Secured Notes (the "Notes"), maturing
on April 23, 2012.
The proceeds from the Notes issued were used to repay the $200 million
current portion of the bridge facility entered into at the time of the
acquisition of Loyalty Management Group.
Recent Developments
PartnershipsKatz Group Canada
-----------------As announced yesterday, Aeroplan has signed a multi-year agreement with
Katz Group Canada that will enable members of the Aeroplan Program to earn
miles on purchases at select Rexall and Rexall Pharma Plus locations in
Western Canada, Thunder Bay, Ontario and the North West Territories.Expedia
-------On June 15, 2009, Nectar announced its new redemption offering with
Expedia.co.uk., the UK's largest online travel agent and the only travel
company which offers its customers the ability to collect and spend their
Nectar points on travel deals around the world.Homebase
--------On May 18, 2009, Homebase, the UK's second largest home improvement
retailer, became Nectar's do-it-yourself partner allowing Nectar members to
earn Nectar Points at Homebase's 330 stores. More than 400,000 new Nectar
members signed up and over 3 million members collected points at Homebase
within ten weeks.TAM Airlines
------------On April 27, 2009, Aeroplan announced the addition of Air Canada's
partner TAM Airlines (TAM) to its growing roster of travel partners.
Non-GAAP Measures
In order to provide a better understanding of the results, the following
terms are used:
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization
EBITDA adjusted for certain factors particular to the business, such as
changes in deferred revenue and Future Redemption Costs ("Adjusted EBITDA"),
is used by management to evaluate performance, and to measure compliance with
debt covenants. Management believes Adjusted EBITDA assists investors in
comparing the Corporation's performance on a consistent basis without regard
to depreciation and amortization, which are non-cash in nature and can vary
significantly depending on accounting methods and non-operating factors such
as historical cost.
Adjusted EBITDA is not a measurement based on GAAP, is not considered an
alternative to operating income or net income in measuring performance, and is
not comparable to similar measures used by other issuers. For a reconciliation
to GAAP, please refer to the SUMMARY OF CONSOLIDATED OPERATING RESULTS AND
RECONCILIATION OF EBITDA, ADJUSTED EBITDA, ADJUSTED NET EARNINGS AND FREE CASH
FLOW included in the attached schedule. Adjusted EBITDA should not be used as
an exclusive measure of cash flow because it does not account for the impact
of working capital growth, capital expenditures, debt repayments and other
sources and uses of cash, which are disclosed in the statements of cash flows.
Adjusted Net Earnings
Net earnings in accordance with GAAP adjusted for Amortization of
Accumulation Partners' contracts and technology; Change in deferred revenue,
Change in Future Redemption Costs and the income tax effect thereon calculated
at the effective income tax rate as reflected in the statement of operations,
provides a measurement of profitability calculated on a basis consistent with
Adjusted EBITDA.
Adjusted Net Earnings is not a measurement based on GAAP, is not
considered an alternative to net earnings in measuring profitability, and is
not comparable to similar measures used by other issuers. For a reconciliation
to GAAP, please refer to the SUMMARY OF CONSOLIDATED OPERATING RESULTS AND
RECONCILIATION OF EBITDA, ADJUSTED EBITDA, ADJUSTED NET EARNINGS AND FREE CASH
FLOW included in the attached schedule.
Standardized Free Cash Flow ("Free Cash Flow")
Free Cash Flow is a non-GAAP measure recommended by the CICA in order to
provide a consistent and comparable measurement of free cash flow across
entities of cash generated from operations and is used as an indicator of
financial strength and performance.
Free Cash Flow is defined as cash flows from operating activities, as
reported in accordance with GAAP, less adjustments for:(a) total capital expenditures as reported in accordance with GAAP; and
(b) dividends, when stipulated, unless deducted in arriving at cash flows
from operating activities.For a reconciliation to cash flows from operations please refer to the
SUMMARY OF CONSOLIDATED OPERATING RESULTS AND RECONCILIATION OF EBITDA,
ADJUSTED EBITDA, ADJUSTED NET EARNINGS AND FREE CASH FLOW included in the
attached schedule.
EBITDA and Free Cash Flow are non-GAAP measurements recommended by the
CICA in accordance with the draft recommendations provided in their February
2008 publication, Improved Communications with Non-GAAP Financial Measures -
General Principles and Guidance for Reporting EBITDA and Free Cash Flow.
Quarterly Investor Conference Call / Audio Webcast
Groupe Aeroplan Inc. will hold an analyst call at 1:00 p.m. ET on Friday
August 14, 2009 to discuss its 2009 second quarter results. The call may be
accessed by dialing toll free: 1-800-731-6941 or 416-644-3424 for the Toronto
area. The call will be simultaneously audio webcast at:
http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2732400.
An archive of the audio webcast will be available at:
http://www.groupeaeroplan.com/pages/invEvents.php for ninety days following
the original broadcast.
The unaudited consolidated financial statements. the MD&A and analysis
and a slide presentation will be accessible on the investor relations website
at www.groupeaeroplan.com under Financial Results.
About Groupe Aeroplan Inc.
Groupe Aeroplan Inc. is a leading international loyalty management
corporation. Groupe Aeroplan owns Aeroplan, Canada's premier loyalty program
and Nectar, the United Kingdom's leading coalition loyalty program. In the
Gulf Region, Groupe Aeroplan owns 60 per cent of Rewards Management Middle
East, the operator of Air Miles programs in the United Arab Emirates, Qatar
and Bahrain. Groupe Aeroplan also operates LMG Insight & Communication, a
customer-driven insight and data analytics business offering international
services to retailers and their suppliers.
For more information about Groupe Aeroplan, please visit
www.groupeaeroplan.com.
Caution Concerning Forward-Looking Statements
Certain statements in this news release may contain forward-looking
statements. 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, risks related to the business
and the industry, Air Canada liquidity issues, dependency on top Accumulation
Partners, Air Canada or travel industry disruptions, Airline 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 herein represent
Groupe Aeroplan's expectations as of August 13, 2009, and are subject to
change after that date. 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.-------------------------------
(*) See Non-GAAP measures below.
SUMMARY OF CONSOLIDATED OPERATING RESULTS AND RECONCILIATION OF EBITDA,
ADJUSTED EBITDA, ADJUSTED NET EARNINGS AND FREE CASH FLOW
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(in thousands,
except miles,
share and per Three months ended Six months ended
share information) June 30, June 30,
------------------------------------------------------
------------------------------------------------------
2009 2008 2009 2008
------------------------------------------------------
$ $ $ $
-------------------------------------------------------------------------
Gross Billings
from the sale of
Aeroplan Miles 337,832 357,858 664,080 700,508
-------------------------------------------------------------------------
Aeroplan Miles
revenue 312,400 317,579 648,144 654,865
Other revenue 21,115 19,149 41,195 38,078
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total revenue 333,515 336,728 689,339 692,943
Cost of rewards (201,728) (192,593) (428,090) (415,820)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gross margin 131,787 144,135 261,249 277,123
Selling, general
and administrative
expenses (68,626) (69,627) (134,767) (134,138)
Depreciation and
amortization (5,127) (4,998) (10,064) (9,670)
-------------------------------------------------------------------------
Operating income
before
amortization of
Accumulation
Partners'
contracts and
technology 58,034 69,510 116,418 133,315
-------------------------------------------------------------------------
Depreciation and
amortization 5,127 4,998 10,064 9,670
-------------------------------------------------------------------------
EBITDA(1) 63,161 74,508 126,482 142,985
-------------------------------------------------------------------------
Adjustments:
Change in
deferred
revenue
Gross billings
from the sale
of Aeroplan
Miles 337,832 357,858 664,080 700,508
Aeroplan Miles
revenue (312,400) (317,579) (648,144) (654,865)
Change in Future
Redemption
Costs(2) (18,029) (32,931) (7,101) (32,501)
(Change in
Net Aeroplan
Miles
outstanding x
Average Cost
of Rewards
per Mile for
the period)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Subtotal of
Adjustments 7,403 7,348 8,835 13,142
-------------------------------------------------------------------------
Adjusted EBITDA(1) 70,564 81,856 135,317 156,127
-------------------------------------------------------------------------
Net earnings in
accordance with
GAAP 26,746 31,454 49,974 73,586
Weighted average
number of shares 199,462,480 199,402,234 199,423,366 199,402,426
Earnings per
share 0.13 0.16 0.25 0.37
-------------------------------------------------------------------------
Net earnings in
accordance with
GAAP 26,746 31,454 49,974 73,586
Amortization of
accumulation
partners'
contracts and
technology 20,485 22,688 40,200 45,366
Subtotal of
Adjustments
(from above) 7,403 7,348 8,835 13,142
Effective tax
rate(3) 32.15% 9.09% 25.38% 0.15%
Tax on
adjustments at
the effective
rate (2,380) (668) (2,242) (20)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Adjusted net
earnings(4) 52,254 60,822 96,767 132,074
Adjusted net
earnings per
share 0.26 0.31 0.49 0.66
-------------------------------------------------------------------------
Cash flow from
operations 121,843 92,188 105,831 116,591
Maintenance
Capital
Expenditures (6,005) (6,558) (13,987) (13,423)
Dividends (24,997) (41,994) (49,994) (83,988)
-------------------------------------------------------------------------
Free cash flow(4) 90,841 43,636 41,850 19,180
-------------------------------------------------------------------------
Total dividends
declared 24,997 41,994 49,994 83,988
Total dividends
declared/share 0.125 0.21 0.25 0.42
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(in thousands,
except miles,
share and per
share information) % Variation
------------------------------------------------------
------------------------------------------------------
Q2 YTD
------------------------------------------------------
-------------------------------------------------------------------------
Gross Billings
from the sale of
Aeroplan Miles (5.6) (5.2)
-------------------------------------------------------------------------
Aeroplan Miles
revenue (1.6) (1.0)
Other revenue 10.3 8.2
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total revenue (1.0) (0.5)
Cost of rewards 4.7 3.0
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gross margin (8.6) (5.7)
Selling, general
and administrative
expenses (1.4) 0.5
Depreciation and
amortization 2.6 4.1
-------------------------------------------------------------------------
Operating income
before
amortization of
Accumulation
Partners'
contracts and
technology (16.5) (12.7)
-------------------------------------------------------------------------
Depreciation and
amortization 2.6 4.1
-------------------------------------------------------------------------
EBITDA(1) (15.2) (11.5)
-------------------------------------------------------------------------
Adjustments:
Change in
deferred
revenue
Gross billings
from the sale
of Aeroplan
Miles
Aeroplan Miles
revenue
Change in Future
Redemption
Costs(2)
(Change in
Net Aeroplan
Miles
outstanding x
Average Cost
of Rewards
per Mile for
the period)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Subtotal of
Adjustments
-------------------------------------------------------------------------
Adjusted EBITDA(1) (13.8) (13.3)
-------------------------------------------------------------------------
Net earnings in
accordance with
GAAP (15.0) (32.1)
Weighted average
number of shares
Earnings per
share
-------------------------------------------------------------------------
Net earnings in
accordance with
GAAP
Amortization of
accumulation
partners'
contracts and
technology
Subtotal of
Adjustments
(from above)
Effective tax
rate(3)
Tax on
adjustments at
the effective
rate
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Adjusted net (14.1) (26.7)
earnings(4)
Adjusted net
earnings per
share
-------------------------------------------------------------------------
Cash flow from 32.2 (9.2)
operations
Maintenance
Capital
Expenditures
Dividends
-------------------------------------------------------------------------
Free cash flow(4) 108.2 118.2
-------------------------------------------------------------------------
Total dividends
declared
Total dividends
declared/share
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(1) A non-GAAP measurement, excluding the effect of the "Foreign
Exchange" line of the Statement of Operations, as it reflects the
impact of the currency SWAP.
(2) The per unit cost derived from this calculation is retroactively
applied to all prior periods with the effect of revaluing the Future
Redemption Cost liability on the basis of the latest available
average unit cost.
(3) Effective tax rate calculated as follows: income tax expense per
statement of operations / earnings before income taxes for the
period.
(4) A non-GAAP measurement.
SUMMARY OF QUARTERLY RESULTS
This section includes sequential quarterly data for the six quarters
ended June 30, 2009.
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(in thousands,
except per
share amounts) 2009
-------------------------------------------------------------------------
(unaudited) Q2 Q1
-------------------------------------------------------------------------
$ $
-------------------------------------------------------------------------
Gross Billings 337,832 326,248
-------------------------------------------------------------------------
Aeroplan Miles
revenue 312,400 335,744
Other revenue 21,115 20,080
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total revenue 333,515 355,824
Cost of rewards 201,728 226,362
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gross margin 131,787 129,462
Selling, general
and administrative
expenses 68,626 66,141
Depreciation and
amortization 5,127 4,937
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Operating income
before
amortization of
Accumulation
Partners'
contracts and
technology 58,034 58,384
Amortization of
Accumulation
Partners'
contracts and
technology 20,485 19,715
-------------------------------------------------------------------------
Operating income 37,549 38,669
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net earnings
(loss) 26,746 23,228
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Adjusted
EBITDA(1) 70,564 65,228 (4)
-------------------------------------------------------------------------
Adjusted net
earnings(1) 52,254 44,551
-------------------------------------------------------------------------
Net earnings 26,746 23,228
Earnings per
share 0.13 0.12
-------------------------------------------------------------------------
Free cash flow(1) 90,841 (48,991)
-------------------------------------------------------------------------
Earnings per
share, in
accordance with
GAAP 0.13 0.12
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(in thousands,
except per
share amounts) 2008
-------------------------------------------------------------------------
(unaudited) Q4 Q3 Q2 Q1
-------------------------------------------------------------------------
$ $ $ $
-------------------------------------------------------------------------
Gross Billings 364,437 355,603 357,858 342,650
-------------------------------------------------------------------------
Aeroplan Miles
revenue 409,552 313,319 317,579 337,286
Other revenue 20,780 21,635 19,149 18,929
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Total revenue 430,332 334,954 336,728 356,215
Cost of rewards 252,229 191,033 192,593 223,227
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Gross margin 178,103 143,921 144,135 132,988
Selling, general
and administrative
expenses 66,426 71,027 69,627 64,511
Depreciation and
amortization 6,494 4,472 4,998 4,672
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Operating income
before
amortization of
Accumulation
Partners'
contracts and
technology 105,183 68,422 69,510 63,805
Amortization of
Accumulation
Partners'
contracts and
technology 19,836 22,636 22,688 22,678
-------------------------------------------------------------------------
Operating income 85,347 45,786 46,822 41,127
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Net earnings
(loss) (1,073,752)(2) 34,956 31,454 42,132
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Adjusted
EBITDA(1) 80,559 (4) 79,366 (4) 81,856 (4) 73,267 (4)
-------------------------------------------------------------------------
Adjusted net
earnings(1) 84,661 (3) 63,229 60,822 69,971
-------------------------------------------------------------------------
Net earnings 86,948 (3) 34,956 31,454 42,132
Earnings per
share 0.44 (3) 0.18 0.16 0.21
-------------------------------------------------------------------------
Free cash flow(1) 42,492 115,868 43,636 (24,456)
-------------------------------------------------------------------------
Earnings per
share, in
accordance with
GAAP (5.39) 0.18 0.16 0.21
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(1) A non-GAAP measurement.
(2) Includes impairment charge.
(3) Excludes impairment charge.
(4) A non-GAAP measurement, excluding the effect of the "Foreign
Exchange" line of the Statement of Operations, as it reflects the
impact of the currency SWAP.
For further information:
For further information: Media: Michele Meier, (514) 205-7028, michele.meier@aeroplan.com; JoAnne Hayes, (416) 352-3706, joanne.hayes@aeroplan.com; Analysts: Trish Moran, (416) 352-3728, trish.moran@aeroplan.com