Points reports Q3 2003 results
Highlights include continued revenue growth
Toronto, November 21, 2003 – Points International Ltd. (TSXV: PTS), operator of the only independent loyalty program currency exchange – at www.points.com – reported financial results for the period ending September 30, 2003.
“During the quarter, Points continued to focus on key business expansion, including recent major developments in our most important corporate relationships,” said Rob MacLean, CEO of Points. “Through 2003, we have invested significant effort and resources on critical partnerships such as American Airlines AAdvantage, InterActiveCorp and eBay, and we are excited about the potential for our business’ continued healthy growth rate.”
“Points has built and launched several additional solutions for the eBay Anything™ Points program – solutions that enhance both eBay’s new loyalty program and our pointsxchange® offering,” MacLean noted. “Expansion of our eBay relationship includes integration work related to the new MBNA Anything™ Points credit card and integration of several Anything™ Points earn partners such as Lending Tree and Sprint. This, along with the pointsxchange, has been a critical factor in the successful launch of eBay’s program.”
Financial highlights:
• Revenue of $1.65 million ($US 1.18 million) for Q3 2003, compared with revenue of $729,467 ($US 486,311) earned during Q3 2002, and $1.46 million ($US 1.04 million) reported for Q2 2003. The quarter-over-quarter revenue growth rate was 13% from Q2 to Q3 2003 and 126% from Q3 2002. The majority of revenues continue to be based on core, recurring transactions.
• General & Administrative expenses were $2.16 million, up from $1.71 million for Q2 2003. The growth in G&A expenses relates to investment for the acquisition of new partners and the expansion of the eBay relationship. This managed growth in G&A expenses is expected to continue at a similar pace through Q4 2003.
• Non-cash expenses accounted for $1.11 million of the $1.63 million quarterly net loss (including $730,353 in amortization of assets and $384,625 in accrued interest). Points expects amortization expenses to drop significantly after 2003 as certain assets become fully amortized.
• Points has now powered the online exchange, sale and transfer of over 2.6 billion points and miles.
• Exchange volume during Q3 2003 represents the second best quarter ever, with volumes 3.6 times those for Q1 2003, and more than the total volume for all of 2002. The cumulative number of miles exchanged increased by 32% during Q3 2003.
• The average volume of points per member exchange transaction also continued to grow through the quarter, increasing to 20,900 from 18,300 during Q2 and 12,700 during Q1.
Key business developments during Q3 2003 and to date
• As previously announced, Points completed a new multi-year agreement with cornerstone partner American Airlines AAdvantage, the world’s largest and most powerful loyalty program. This commitment offers significant growth potential for Points, extending a number of existing short-term agreements through 2007, including those for pointsxchange®, pointspurchase™ and pointstransfer™.
• In the first quarter of our relationship with eBay, Points worked closely with this major new loyalty player to launch two program enhancements. The recently announced eBay Anything™ Points credit card from MBNA and other integrations are great steps forward for both the Anything™ Points program and for Points growing support role.
• During Q3 2003, Points established a relationship with Cendant Corp.’s new loyalty initiative, Trip Rewards.
• pointsxchange has attracted 33 participants, representing over 142 million member accounts and approximately 7,000 exchange opportunities (including gift certificate programs). Points was excited to add new pointsxchange relationships with KidsFutures, BabyMintz and NestEggs. Additionally, Points has a total of 38 custom solutions products deployed, including over 8 with eBay alone.
More about Points International Ltd. and www.points.com
Points operates the only independent loyalty points exchange – at www.points.com – allowing consumers to exchange points and miles from one participating loyalty program to another to achieve the rewards they want faster than ever before.
Pointsxchange® has to date attracted close to 33 partners, including industry leaders eBay (Anything Points), American Airlines (AAdvantage), InterContinental Hotels (Priority Club® Rewards), Air Canada (Aeroplan), Delta Air Lines (Sky Miles), Imperial Oil (Esso Extra), GiftCertificates.com, Fairmont Hotels & Resorts, Cathay Pacific Airways (Asia Miles), American West Airlines (FlightFund), Alaska Airlines, (Mileage Plan), Sprint, JCPenney and many more.
Through a portfolio of custom technology solutions, Points is building rewarding partnerships with the world’s leading loyalty players. Additional Points Solutions include the innovative pointspurchase™ and pointsgift solutions, which power the online sale of miles and points to members of leading loyalty programs.
Points Solutions, including pointsxchange, are internationally marketed to travel providers and loyalty programs through a distribution alliance with Sabre, the leading provider of technology, distribution and marketing services for the travel industry.
Points shares trade on the TSX Venture exchange under the symbol PTS.
For more information, please contact:
Investor Relations
Points International Ltd.
416-596-6381
christopher.barnard@points.com
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