Bread Financial Holdings, Inc. · NYSE:BFH
Bread Financial — Alliance Data Systems — Investor Presentation (May 2007)
13 slides from Bread Financial's investor presentation, May 9, 2007
Slide 1: Alliance Data Q2 2007
Alliance Data NYSE: ADS Q2 2007
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this presentation may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements may use words such as "anticipate,"
Slide 3: Alliance Data: Driving Loyalty Through Transaction-Rich Businesses
Alliance Data: Driving Loyalty Through Transaction-Rich Businesses AIR MILES 135 Sponsors (Canada) Abacus 1,500 Retailers External Coalition WPS Union Gas Green Mountain Puget Sound Utility Epsilon Hilton HHonors(r) Bank of America CapitalOne Circuit City Individual Programs Epsilon Citibank ThankYo
Slide 4: Alliance Data - Financial Profile
Alliance Data - Financial Profile Growth Company Double-digit Organic Growth Baseline Targets 12% Topline 15% EBITDA 18% Cash EPS Strong Visibility & Predictability Free Cash Flow > Reported Earnings Free Cash Flow > Reported Earnings Free Cash Flow > Reported Earnings Free Cash Flow > Reported Earn
Slide 5: 2000 - 2007 Revenue, EBITDA, Cash EPS
2000 - 2007 (in $MM, except per share) '00 '01 '02 '03 '04 '05 '06 '07E '00 '01 '02 '03 '04 '05 '06 '07E '00 '01 '02 '03 '04 '05 '06 '07E $670 $770 $865 $1,047 $1,257 $1552 $97 $123 $144 $211 $279 $350 $2.06 $1.54 $1.03 $0.59 $0.49 $0.40 Revenue EBITDA Cash EPS 18% CAGR 30% CAGR 37% CAGR $1,998 $515
Slide 6: Operating Leverage
Operating Leverage ADJ. EBITDA Margin Goal: 50bps Expansion per Year 16.0% 14.5% 16.7% 20.1% '00 '01 '02 '03 '04 '05 '06 '07E Averaging over 100 bps per Year 22.2% 22.6% 25.8% 27.9%
Slide 7: 2007 Guidance
2007 Guidance Revenues ^ $2.2 Billion EBITDA ^ $615 Million Cash EPS ^ $3.60 Includes "playing through" at least 25¢ of growover (suggests "normalized" growth of 25% plus)
Slide 8: 2007 Est. Free Cash Flow
2007 Est. Free Cash Flow ($MM, Except per Share) ADJ. EBITDA $615 Loyalty Cash Flow Adj. 30 Operating EBITDA $645 Less Capex / Int. / Taxes (335) Free Cash Flow $310 Per Share $3.80
Slide 9: Marketing Services - Canada Loyalty
Marketing Services - Canada Loyalty AIR MILES(r) Program Solid Mid-teens Growth Coalition Loyalty Program Based Upon Everyday Spend - - Not an Airline Program 2/3 of Canada Active Clients: Shell Oil, Safeway, American Express, Bank of Montreal Three Sources of Future Growth: New Sponsor Categories D
Slide 10: Marketing Services - U.S.
Marketing Services - U. S. Solid Mid-teens Growth or Higher Top 25 Clients: 10 Year Average Tenure Clients: Hilton Hotels, Pfizer, AOL, Office Depot, Nestle Purina PetCare, AstraZeneca, Midas, Bank of America Key Verticals: Financial Services, Retail, Hospitality, Pharma, Sources of Future Growth: C
Slide 11: Private Label Services
Private Label Services Attractive Market - 1998-03: Double-digit Annual Growth for Outsourcers Services: Private Label Processing Customer Care / Call Center Credit: 700 Score, No Sub-Prime Targeting Database Marketing Services Income Streams: Split Between Processing and Credit Clients: Victoria's
Slide 12: Utility Services
Utility Services Serving Both Regulated & De-regulated Services: Core Processing Customer Care / Call Center Database and Marketing Services Income Stream: Earnings Based on Monthly # Statements Clients: Duke, Entergy, Puget Sound, Centrica, Georgia Natural Gas, Orlando, City of Austin Market Opport
Slide 13: Services with Pricing Power
Services with Pricing Power Long-term Relationships 10 - 12 New Clients per Year 10 - 12 New Clients per Year 10 - 12 New Clients per Year 10 - 12 New Clients per Year Our Keys for Success
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