06:23:39 EDT Fri 29 Mar 2024
Enter Symbol
or Name
USA
CA



Points International Ltd (2)
Symbol PTS
Shares Issued 15,400,273
Close 2014-05-08 C$ 23.80
Market Cap C$ 366,526,497
Recent Sedar Documents

Points International earns $443,000 (U.S.) in Q1

2014-05-08 16:26 ET - News Release

Mr. Rob MacLean reports

POINTS INTERNATIONAL LTD. REPORTS FIRST QUARTER 2014 FINANCIAL RESULTS

Points International Ltd. has released its results for the first quarter ended March 31, 2014.

  • Revenues of $58.3-million, an increase of 58 per cent year over year;
  • Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization, foreign exchange, and impairment) of $1.2-million, an increase of 127 per cent year over year;
  • Net income of $443,000, compared with a net loss of $48,000 in the prior-year period;
  • Four new partners announced or launched since the start of 2014 including Hilton Worldwide and MasterCard Worldwide.

"The year is off to a strong start, characterized by strong financial performance, ongoing platform expansion and strategic investments," said chief executive officer Rob MacLean. "Revenues grew nearly 60 per cent year over year, driven by the successful on boarding of several new loyalty partners over the past 12 months, as well as the continued expansion of our existing loyalty network through new product launches and strong marketing and merchandising efforts. Led by our robust growth in revenue and gross margin dollars, adjusted EBITDA more than doubled over the prior-year period, all while the company continues to make strategic investments in our future growth opportunities."

Mr. MacLean continued: "Throughout the course of 2013, we strengthened our foundation through both the growth of our existing partner network as well as through several significant and strategic loyalty program partner additions. This momentum has carried into 2014 as evidenced by the recent additions of MasterCard, Hilton, Spirit Airlines and, most recently, Etihad Airlines to the Points partner network. Our new partnership with Etihad will give businesses and merchants in the [United Kingdom], Europe, Middle East and Africa regions access to miles from Etihad Airways' well-established and globally recognized Etihad Guest frequent flyer program, to incentivize customers and grow revenues. We are thrilled to be able to offer our innovative solutions to additional loyalty programs around the world in support of our broader mission to make loyalty programs more valuable and engaging.

"Innovation will continue to be a prevailing theme throughout 2014," added Mr. MacLean. "We are particularly excited about our recently announced acquisition of PointsHound and our ability to leverage the PointsHound team and technology to drive advancements across our loyalty currency platform, particularly with respect to our open platform strategy."

First quarter 2014 financial results

(Unless otherwise stated, all comparisons for the first quarter of 2014 are on a year-over-year basis.)

Revenues totalled $58.3-million, up 58 per cent from $36.9-million. Principal revenues totalled $56.2-million, up 62 per cent from $34.6-million. The year-over-year increase in principal revenues was largely due to the impact of new partners launched over the course of 2013, as well as the growth from existing partners through strong marketing and merchandising efforts.

Gross margin dollars totalled $8.3-million, or 14.2 per cent of total revenue, compared with $6.7-million, or 18.0 per cent of total revenue. The increase in gross margin dollars was largely driven by the impact of new partnerships launched over the course of 2013. As a percentage of revenue, gross margin reflects the relative mix of partner and product activity during the quarter.

Adjusted EBITDA totalled $1.2-million, up 127 per cent from $529,000. Revenue and gross margin growth outpacing that of operating expense contributed to the strong year-over-year increase in adjusted EBITDA.

Net income totalled $443,000, or three cents per diluted share, compared with a net loss of $48,000, or break-even per share.

As of March 31, 2014, total funds available, comprising cash and cash equivalents, together with security deposits, restricted cash and amounts with payment processors, were $66.2-million. The company remains debt free and is pleased with its overall financial position.

              FIRST QUARTER BUSINESS METRICS

                                       Q1 2014    Q1 2013
Total, all channels
Points/miles transacted (in 000s)    4,724,111  4,420,726
Number of points/miles transactions    547,232    377,845

Outlook

The company is providing financial guidance for the year ending Dec. 31, 2014, as follows:

  • Revenue is expected to grow in the range of 25 per cent to 40 per cent over 2013. This revenue range contemplates organic growth within Points' existing business, as well as the contribution from partners and products announced or launched since 2013.
  • Adjusted EBITDA is expected to be in the range of $16-million to $20-million, prior to making strategic investments.
  • Strategic investments are expected to be in the range of $5-million to $7-million for 2014, a slight increase from the company's prior outlook, to account for the PointsHound transaction.

Investor conference call

Points' conference call with investors will be held today at 4:30 p.m. Eastern Time. To participate, investors from the United States and Canada should dial 877-407-0784 10 minutes prior to the start time. International diallers should call 201-689-8560.

In addition, the call is being webcast, can be accessed at the company's website and will be archived on-line upon completion of the call. A telephonic replay of the conference call will be available through May 22, 2014, by dialling 877-870-5176 in the U.S. or Canada or 858-384-5517 internationally and entering the conference ID 13580620.

         CONDENSED CONSOLIDATED INTERIM STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
             Expressed in thousands of U.S. dollars, except per-share amounts
                                                                                   For the three 
                                                                                    months ended
                                                                                      March 31,
                                                                                  2014        2013
Revenue
Principal                                                                     $ 56,162    $ 34,600
Other partner revenue                                                            2,076       2,304
Interest                                                                            19          14
Total revenue                                                                 $ 58,257    $ 36,918
Expenses
Direct cost of principal revenue                                                49,989      30,259
Employment costs                                                                 5,505       4,495
Marketing and communications                                                       198         269
Technology services                                                                219         235
Depreciation and amortization                                                      544         919
Foreign exchange gain (loss)                                                       (68)         28
Operating expenses                                                               1,146       1,131
Total expenses                                                                $ 57,533    $ 37,336
Operating income (loss)                                                           $724       ($418)
Interest and other (income)                                                         (5)          -
Operating income (loss) before income taxes                                      $ 729      $ (418)
Income tax expense (recovery)                                                      286        (370)
Net income (loss)                                                                $ 443       $ (48)
Other comprehensive loss
Items that will subsequently be reclassified to profit or loss
(Loss) on foreign exchange derivatives designated as cash flow hedges,
net of income tax recovery of $118 (2013: $39)                                    (326)       (108)
Reclassification to net income of loss on foreign exchange derivatives
designated as cash flow hedges, net of income tax recovery $70 (2013: $11)         195          32
Other comprehensive (loss) for the period, net of income tax                    $ (131)      $ (76)
Total comprehensive income (loss)                                                $ 312      $ (124)
Earnings (loss) per share
Basic earnings (loss) per share                                                 $ 0.03     $ (0.00)
Diluted earnings (loss) per share                                               $ 0.03     $ (0.00)

We seek Safe Harbor.

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