Aimia Inc. · TSX:AIM
Aimia — Groupe Aeroplan — Investor Day (December 2009)
63 slides from Aimia's investor day presentation, Dec 10, 2009
Slide 1: Speaker Presentations
SPEAKER PRESENTATIONS December 10, 2009
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements. Such statements may involve but are not limited to comments with respect to Groupe Aeroplan's and Carlson Marketing's strategies, expectations, planned operations, future actions, anticipated financial performance and
Slide 3: Achieving Our Vision
Achieving Our Vision To be the global leader in loyalty management Financially Attractive The addition of Carlson Marketing to Groupe Aeroplan will: increase our consolidated Turnover (Gross Billings and Marketing Fees) to over C$2 billion and diversify our revenue base and risk be accretive to
Slide 4: An International Leader of Marketing Services
An International Leader of Marketing Services Solid reputation, long history More than 130+ clients around the world Approximately 2000 employees Provides full or partial loyalty program management Program strategy and design CRM / program analytics and management Web / mobile marketin
Slide 5: A Logical Extension of Our Business Model
A Logical Extension of Our Business Model Strategically, we believe Carlson Marketing is a logical extension of our business model for three main reasons: Provides access to a greater share of corporate dollars being spent on loyalty marketing and decision sciences / data analytics Substantially
Slide 6: Attractive Markets Offer Potential For High Return; Agenda
Attractive Markets Offer Potential For High Return G20 countries Post Carlson Marketing acquisition Canada UK USA Spain Italy Middle East India Hong Kong Malaysia Singapore Indonesia Brazil Australia New Zealand Agenda 10:00 AM – 12:00 PM Opening Remarks – Rupert Duchesne, President and CEO, Groupe
Slide 7: Carlson Marketing Transaction Summary
DAVE ADAMS Executive VP & CFO Groupe Aeroplan Carlson Marketing Transaction Summary Purchase price USD 175.6 Cash on hand * USD 78.0 Cash proceeds on closing USD 253.6 x 1.05 = Cash CAD 266 million Funded by approximately CAD 123 million surplus cash on hand plus CAD 143 million in incremental ban
Slide 8: Carlson Marketing Transaction Summary and Revenue
Carlson Marketing Transaction Summary Closed on a September 28, 2009 audited special purpose balance sheet, giving effect to certain excluded assets and liabilities and determining a base net working capital position Working capital roll-forward to December 7, 2009 with a post closing adjustment
Slide 9: Carlson Marketing Revenue Components
Carlson Marketing Revenue Components 2009E Revenue by Business Component E&E Revenue ue 9% Loyalty Revenue 91% Loyalty re 91% E&E Top 10 Clients Represent 67% of Total Revenue Loyalty Top 10 Clients Represent 59% of Total Revenue Client A (Financial Svs) Client A (Financial) Client B (Telcom) Client
Slide 10: Carlson Marketing Financial Guidance
Carlson Marketing Financial Guidance 2010 USD GAAP revenue CAD 600+ million 2010 EBITDA based on USD GAAP 6% to 8 % revenue & before one time costs Annual capital expenditures USD 10 million One time transition costs USD 15 million (50% opex/50% capex) Income Taxes: Canada 32% US nil UK nil Internat
Slide 11: Groupe Aeroplan Carlson Marketing
GROUPE AEROPLAN marketing
Slide 12: Carlson Marketing has operations in 15 countries
Carlson Marketing has operations in 15 countries, including regional offices in Toronto, London and Sydney Percentages denote projected 2009 revenue by region Carlson Marketing has operations in 15 countries, including regional offices in Toronto, London and Sydney CANADA EMEA 19% 8% ASIA PACIFIC U.
Slide 13: Carlson Marketing Management Team
Carlson Marketing has operations in 15 countries, including regional offices in Toronto, London and Sydney CANADA EMEA 19% 8% ASIA PACIFIC U.S. 19% 54% Percentages denote projected 2009 revenue by region Carlson Marketing Management Team JEFF BALAGNA PRESIDENT & CEO ANDY WRIGHT ROBERT CLARKSON JONAT
Slide 14: Carlson Marketing is one of the top two independent marketing services companies
Carlson Marketing is one of the top two independent marketing services companies in the world CAD 608 million in worldwide revenue TOP 27 offices PROPRIETARY LOYALTY 15 countries COMPANY IN THE WORLD 2,170 talented professionals #2 INDEPENDENT LOYALTY 70 year history Top 10 MARKETING COMPANY MOBILE
Slide 15: Strong Client Portfolio of Key Industry Leaders
Strong Client Portfolio of Key Industry Leaders with Long Established Relationships FINANCIAL SERVICES AIRLINE TRAVEL & HOSPITALITY AUTO TECH & TELCO RETAIL CPG & OTHERS The world’s biggest brands look to Carlson Marketing for their loyalty needs Strong Client Portfolio of Key Industry Leaders with
Slide 16: Significant Restructuring and Stabilization Efforts
Significant Restructuring and Stabilization Efforts Completed in 2008 and 2009 Restructuring efforts drove Exit of unprofitable and cost efficiencies and profit non-strategic operations improvement Sale of Peppers & Rogers Group Recruitment of key talent across Exit Korea all regions Exit Ch
Slide 17: 2009 Business Highlights
2009 Business Highlights CMW is running ahead of plan for 2009 and is projecting to end the year strong Loyalty is significantly above target with all regions either on or ahead of plan Engagement & Events market has stabilized and business has adjusted its cost structure to avoid losing money
Slide 18: Significant Growth Opportunities Across Key Verticals
Significant Growth Opportunities Exist Across Key Verticals U.S. MARKET LOYALTY MEMBERSHIP VOLUMES THOUGHT LEADERSHIP INNOVATION & REPUTATION SCALE & EXPERIENCE SHARING EXECUTION & EFFICIENCY INNOVATION & SYSTEMS REDESIGN AIRLINES % OF CUSTOMER BASE PENETRATED CREDIT & DEBIT CARDS HOTELS RETAIL 250
Slide 19: Summary
Summary Loyalty marketing is one of the most exciting arenas in marketing services Carlson Marketing combined with Groupe Aeroplan is the premier player in loyalty marketing Carlson Marketing offers a strong platform with significant growth and profit potential ANDY WRIGHT President, U.S. Carl
Slide 20: The Leading U.S. Full Service Loyalty Marketing Company
The Leading U.S. Full Service Loyalty Marketing Company Headquartered in Minneapolis 5 additional offices in New York, Chicago, Detroit, Atlanta, San Francisco 583 Employees #1 Promotion & Event Marketing Company in the US * 13th Largest Marketing Firm in the US across all disciplines *
Slide 21: Diversified Revenue Base; A Talented Management Team
Diversified Revenue Base Percentage of Revenue by Sector A Talented Management Team Andy Wright Jon Von Rentzell Luc Bondar Doug Rozen Paul Walczyk President COO SVP, Gobal Loyalty SVP, Global Lead – SVP, Client Services Tenure: 4 years Tenure: 23 years Tenure: 10 years Creative, Interactive, Tenure
Slide 22: Integrated Full Suite of Loyalty Capabilities
Integrated Full Suite of Loyalty Capabilities STRATEGIC PLANNING DECISION 50 CUSTOMER SERVICE DATA SCIENCES AWARD COMMUNICATIONS SERVICES Growth Profile Major infusion of talent at all levels Undertook a quantum leap in communications strong online skills best of breed mobile capabilities
Slide 23: Future Growth Strategy and Focus
Future Growth Strategy and Focus Targeting both mature and newly emerging sectors Leading with data analytics, centered on proprietary method and measurement Helping clients drive efficiency with smart awards capability Leveraging our leading position in mobile and interactive to transform e
Slide 24: A Measurable Distance Above the Competition; Case Study – Amtrak
A Measurable Distance Above the Competition Integrated Loyalty Operations Full service loyalty specialists Niche loyalty Agencies specialists Member Engagement Case Study – Amtrak Guest Rewards In 1999, Amtrak was preparing to launch the Acela product to compete with East Coast shuttle services
Slide 25: Amtrak Guest Rewards – Constantly Evolving
Amtrak Guest Rewards – Constantly Evolving Feb. 2004 Oct. 2007 Jan 2009 Oct 2009 May. 2002 NEW AGR Phase II of AGR Quick Promotion 1st AGR/Acela MasterCard Website Enrollment Registration Aug. 2001 Integrated launches Launches Live on Launched AGR MasterCard Promotion Amtrak.com Jan. 2003 Launched J
Slide 26: Summary – Capitalizing On Our Market Position
Summary – Capitalizing On Our Market Position A leading position in the US market with end to end integrated services An excellent client roster that demonstrates our capability with real business results and provides ongoing growth opportunities A market that is growing within both traditiona
Slide 27: Carlson Marketing Canada Management
Carlson Marketing Canada • Mississauga HQ • Two Offices in Toronto • One in Montreal • 633 employees • Winner & finalist for Canada’s Top employers Management Highly experienced and cohesive team Average tenure of senior managers is 10 years Industry leadership and strong individual profile an
Slide 28: What We Do; Categories of Focus
What We Do “Loyalty Marketing Is About Share Of Customer – Not Share Of Market” Design and management of proprietary loyalty programs Strategic marketing consultants with a strong systems and operational backbone End to end servicing from initial business case to fulfillment to measurement and
Slide 29: Revenue by Sector; CMW Integrated Products and Services
Revenue by Sector Emerging Retail • Manufacturers • CPG • Hi-Tech / Telco Financial Services • Credit Card Automotive • Sales • Core Banking • Services • Insurance • Aftermarket • Wealth Management CMW Integrated Products and Services
Slide 30: Carlson Rewards Network
Carlson Rewards Network ™ Custom Merchandise Experiential Concierge Merchandise E-Rewards Retail Gift Stored Value Travel Rewards Service Shopping Certificates Card Service Individual Group Lifestyle High-End Adventure Big Day Personalized Special Online/Mobile Tangible Tangible Merchandise Merchand
Slide 31: Enhancement Services Offerings; What Makes Us Unique
Enhancement Services Offerings Enhance Loyalty • Creating new touch-points to anchor customers to our client’s brand • Offering highly valued assistance services and lifestyle benefits. • That improve long-term customer value Enhance Revenue: • Directly generate significant recurring revenue for our
Slide 32: Loyalty Program Health Check; Next Generation Loyalty
Loyalty Program Health Check Next Generation Loyalty: Measurement & Analysis – The Proof
Slide 33: History of Profitability; Challenges Match Our Strengths
History of Profitability Profitability Trend • EBIT growing every year since 2002 • CAGR of 24%. • Double digit revenue growth & operating margin improvements. • YTD 2009 (11 months), EBIT is up 19.4% year-over-year. Drivers of success • Solution-based approach • Our ability to read the market • Fin
Slide 34: Challenges Match Our Strengths; Summary
Challenges Match Our Strengths 1. Customer loyalty & retention 2. Managing mergers/acquisitions/alliances 3. Reducing costs 4. Engaging employees in the company’s vision & values Summary Solid record of performance Positive 10 year sales and profitability trend Continue to build our leadership
Slide 35: Investor Day – Setting a New Measure in Global Loyalty
December 10, 2009 INVESTOR DAY Setting a New Measure in Global Loyalty lL ip We CTT Ty fi | MI ll] WAHL, 1/1, ih 5) oe Wh Mnhiltindy 4 3%! 4 } X — _ AEROPLAN xr marketing Zoo. o0
Slide 36: Fay Beauchine – Engagement & Events Marketing Company
FAY BEAUCHINE President, Engagement & Events Carlson Marketing A Full Service Engagement & Events Marketing Company Minneapolis, Detroit, San Francisco, New York, Parsippany 260 Employees Market leadership position - ranked #2 in size the US market Recognized market leader – top choice Full ra
Slide 37: Carlson Marketing Influences Loyalty Behaviors; Management Team
Carlson Marketing Influences Loyalty Behaviors STRATEGIC & BRAND PLANNING DECISION SCIENCES CREATIVE & BRAND COMMUNICATIONS ENGAGEMENT LOYALTY TECHNOLOGY & EVENTS SERVICES AWARD SERVICES CUSTOMER SERVICE Uniquely integrated to create consumer, channel and employee loyalty Meet Carlson Marketing’s Pr
Slide 38: Leading the Market in Delivering Programs that Make A Difference
Leading the Market in Delivering Programs that Make A Difference Delivering Engagement and Event Solutions that Drive Business Results
Slide 39: Engagement is Big Business
Engagement is Big Business B2E B2B Sales Incentives Channel Incentives Recognition Webinars/Virtual Length of Service Meetings Peer-to-Peer US$46B rewards Dealer Meetings Wellness US$58.5B training Training/Certification Training Web sites/Microsites US$101B events Meetings/
Slide 40: Long-term and Diversified Client Base
Long-term and Diversified Client Base Our clients average tenure is 17 years Solid Execution Keeps Clients Coming Back Pharma Financial Technology & Automotive Retail Others Healthcare Services Telecom
Slide 41: CMW Offers One Stop Shop on Complex Events
CMW Offers One Stop Shop On High Touch Complex Events and Engagement Programs A full service approach differentiates CMW from the competitors High Touch Maritz BI ITA SERVICE LEVEL George P. G2Planet Johnson US Motivaction Motivation Jack CVent Morton Helms Starcite Briscoe Transactional Lenos Low C
Slide 42: Customized Events that Influence Behavior
Customized Events that Influence Behavior Moving Beyond Events to Mobile & Interactive Communications
Slide 43: Memorable Experiences Created; Employee Engagement Solutions
Memorable Experiences Created Employee Engagement Solutions Subaru Performance Improvement Portal
Slide 44: Top Performers Achieve the Ultimate Reward; Citrix Live! Virtual Events
Top Performers Achieve the Ultimate Reward Citrix Live! Virtual Events Virtual events in multiple languages Reached more than 8,000 registrants from 108 countries Facilitated more than 1,500 chats and messages Enabled 16,000 file downloads Managed 25 sponsor and product booths
Slide 45: Synergy Measurement; Summary
Synergy Measurement Before, during and after the event collect data to: Inform the design and content of future events Drive future event registrations Drive interactions with customers and partners during and between events that lead to more sales Summary Positioned to compete Market ripe wi
Slide 46: Three Successive Years Of Double Digit Profit and Margin Improvement
KARL SCHUSTER President, Asia Pacific Carlson Marketing Three Successive Years Of Double Digit Profit and Margin Improvement Drivers of success: Exited unprofitable markets/accounts Focused on core industry verticals for business development Restructured to offer leaner and more flexible clien
Slide 47: Full Service Offering Across the Region; Experienced Team
Full Service Offering Across the Region Hong Kong India* Singapore Malaysia Indonesia Australia New Zealand An Experienced Team with a Proven Track Record Mr Karl Schuster Mr Michael Mr Nik Laming Mr Simon Rowles Asia Pacific Region O’Sullivan Senior VP Vice President President Senior VP, Australia
Slide 48: A Strong Team of Loyalty Specialists
A Strong Team of Loyalty Specialists Hong Kong 1 India* 10 Singapore 40 Malaysia 159 Indonesia 45 Australia 205 New Zealand 31 Long-term Blue-chip Client Relationships
Slide 49: Diversified and Recurring Revenue Streams; A True Competitive Edge
Diversified and Recurring Revenue Streams A True Competitive Edge Carlson Marketing Asia Pacific is perceived in the marketplace as a stable, secure and dependable global company Company has a true competitive edge by offering: Cost-effective end to end solutions Unrivalled global experience
Slide 50: At The Forefront of The Competitive Environment
At The Forefront of The Competitive Environment Our Asia Pacific competitors are very localised, have inflexible and aging systems and are single client dependent. We have the widest Asia Pacific footprint. Won all major proposals over the last three years Winning with Best In Class A network of
Slide 51: Well-poised to Meet Regional Challenges; Growth Opportunities
Well-poised to Meet Regional Challenges Providing coverage in emerging markets for pan-Asian/ global programs Market maturity varies widely across the region Cultural issues in non-English speaking markets Seismic economic forces outside our control Significant Growth Opportunities Organic Growt
Slide 52: Market Developments Point to Greater Demand; Turning Strategy into Action
And Market Developments Point to Greater Demand for Our Services Digital age propelling re-tooling and program redesign for credit card issuers and airlines CPG beginning to express serious interest in how consumer loyalty programs can create value Retail loyalty showing signs of adoption Contro
Slide 53: Our Top Priorities
Our Top Priorities Keep a clear focus on the client's business objectives and the customer's needs Maintain strong relationships with key client decision makers Continually look for improvements in the service delivery model, in costs and in gross margin performance Targeting big programmes
Slide 54: Turnaround Complete – A Solid Platform for Growth
Turnaround Complete – A Solid Platform for Growth Key tenets of our USD 5 million EBITDA turnaround: Hire people who clients want to spend time with Focus only on things that clients care about Get paid for the work we do We Have a Solid Geographic Footprint from Which to Grow Full Service Off
Slide 55: A Full Suite of Services; Revenue is Overwhelmingly Fee Based
A Full Suite of Services Planning and Data Creative and Brand Experience Design Loyalty Management Technology Service Centre Our Revenue is Overwhelmingly Fee Based We are a professional services company We provide loyalty marketing services We make our money primarily by selling time to clien
Slide 56: Our Strengths – Well Poised to Meet Market Challenges
Our Strengths – We Are Clearly Differentiated As Loyalty Marketing Specialists Group Examples Carlson strengths Our competitors strengths LOYALTY ICLP Experience Channel & PI Grass Roots Strategy First Data Platform Emirates Communications CRM OgilvyOne Loyalty expertise Broader CRM agency experienc
Slide 57: Well Positioned Given Market Trends
Well Positioned Given Market Trends Convergence of CRM and loyalty More interest in loyalty generally Clients looking for new revenue streams – data, points Speed to market and relative nimbleness remain important A Well Diversified Revenue Base
Slide 58: We Take Pride in the Type of Clients We Work With
We Take Pride in the Type of Clients We Work With Potential to Further Build on Our Relationships “We are very interested to discuss how a deeper relationship with Groupe Aeroplan could generate additional value for our customers” – Matt Mongoven, Head of Customer Management, RBS Group
Slide 59: Qtel – Developing A National Loyalty Program
Qtel – Developing A National Loyalty Program “Nojoom is one of the biggest, most immediate successes in Qtel’s history” – Adel Al Mutawa, Executive Director, Group Communications Coca-Cola – Creating a Rich Brand Experience “We are evolving our thinking on how to engage customers, beyond giving them
Slide 60: Coca-Cola – Using Sponsorship Assets
Coca-Cola – Creating a Rich Brand Experience: Using Sponsorship Assets
Slide 61: Coca-Cola – Rewarding Interaction
Coca-Cola – Creating a Rich Brand Experience: Rewarding Interaction Coca-Cola – Creating a Rich Brand Experience: Interacting Off-Site
Slide 62: Coca-Cola – The Most Cumulative Site Visitors
Coca-Cola – Creating a Rich Brand Experience: The Most Cumulative Site Visitors Website Performance – Cumulative Visitors Nielsen NetRatings Oct 08 – Oct 09 Coca-cola – Creating a Rich Brand Experience: Leading Levels of Interaction Website Performance – Dwell Time vs Page Views vs Return Visits Nie
Slide 63: Significant Opportunities to Create Shareholder Value
Significant Opportunities to Create Shareholder Value Organic Growth New Products New Geographies Margin improvement