Mr. Phil Mittleman reports

AIMIA REPORTS SECOND QUARTER 2023 RESULTS

Aimia Inc. has released its financial results for the three months ended June 30, 2023.

Q2 2023 highlights and recent events:

• Bozzetto, acquired by Aimia on May 9, 2023, reported strong revenues of $45.9-million and an adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $8.5-million, with an 18.5-per-cent adjusted EBITDA margin for the stub period from May 9, 2023, to June 30, 2023. If Aimia had owned Bozzetto for the full second quarter of 2023, adjusted EBITDA would have been $12.9-million.
• Tufropes reported improved second quarter 2023 revenues of $28.9-million on 9,500 metric tonnes shipped, compared with 8,200 metric tonnes shipped in the first quarter of 2023, which resulted in $25-million in revenues. Adjusted EBITDA was $4.6-million, representing a 15.9-per-cent adjusted EBITDA margin, which was temporarily softened as the business implements operating and growth initiatives. Tufropes expects to see a stronger second half of 2023 with respect to revenues and adjusted EBITDA.
• After quarter-end, Tufropes acquired Cortland Industrial, a leading global designer, manufacturer and supplier of highly engineered synthetic ropes, slings and tethers, for $26.6-million. Tufropes will be rebranded under the Cortland name.
• Capital A (formerly AirAsia), of which Aimia owns approximately 3 per cent of its outstanding shares, experienced significant growth and profitability improvements in each of its business segments, particularly in aviation as air travel and tourism return to Southeast Asia, and its stock continues to hit new 52-week highs.
• Clear Media continues to recover from the impact of zero COVID and the related effects on the Chinese economy. The rebound in the outdoor advertising industry continues, but at a slower pace than expected, as the business focuses on an efficient cost structure and the reduction of underperforming panels.
• Kognitiv successfully closed the sale of a non-core business on Aug. 2, 2023, generating $9.4-million in net proceeds with a potential earn-out, and expects to achieve EBITDA profitability in Q4 2023.
• Trade X generated gross vehicle sales of $193.3-million in the second quarter of 2023, a 13-per-cent reduction from the same period last year. As the business refocuses on profitability through margin growth and developing key trade corridors, Aimia recorded a $25-million unrealized fair value loss on its investments in Trade X.
• Tom Little joined Aimia's board on July 10, 2023, adding valuable executive leadership and financial expertise, and Karen Basian became interim chair, succeeding David Rosenkrantz, who leaves after three years of distinguished service.

Phil Mittleman, chief executive officer of Aimia, commented: "This quarter marks a significant milestone for Aimia, as we continue to execute our stated strategy. We are now the majority owner of two operating companies that we expect will provide revenue growth and strong cash flow generation for Aimia shareholders for years to come. After achieving a fully valued exit of PLM in late 2022, we have successfully redeployed more than $450-million of capital in 2023.

"We are very excited about our plans to drive further growth for both Bozzetto and Tufropes to help them realize their potential as global leaders in their respective markets. The recent acquisition of Cortland Industrial is an example of the type of strategic, value-creating acquisitions these subsidiaries will pursue. Combined, Cortland and Tufropes will benefit from the value created from each other's strengths in manufacturing and engineering, as well as providing a superior product offering in ropes and netting globally. In addition, Bozzetto continues to advance towards its next acquisition, which we believe will be transformative for its business," added Mr. Mittleman.

This quarterly earnings release should be read in conjunction with Aimia's interim consolidated financial ,statements, and management's discussions and analysis (MD&A) for the quarter ended June 30, 2023, which can be accessed on SEDAR+ as well as Aimia's website under investor relations.

Bozzetto

Aimia owns a 94-per-cent equity stake in Bozzetto Group, one of the world's largest ESG (environmental, social and governance)-focused providers of specialty sustainable chemicals:

• The results for Bozzetto, for the quarter ended June 30, 2023, are presented for the period starting May 9, 2023. The revenue for this stub period was $45.9-million with a loss before income taxes of $24.6-million, which included one-time transaction costs of $12.4-million, a $4.3-million non-cash expense related to the Paladin option, as well as a $12.9-million non-cash expense related to the Paladin carried interest. Adjusted EBITDA for the same period amounted to $8.5-million, representing an adjusted EBITDA margin of 18.5 per cent.
• If Aimia had owned Bozzetto for the full second quarter of 2023, pro forma revenue would have been $74.3-million and pro forma adjusted EBITDA would have been $12.9-million.
• Upon closing of the Bozzetto purchase on May 9, 2023, Aimia completed a debt financing at the subsidiary level in the amount of $139.5-million in gross proceeds.
• Aimia sees significant opportunities to continue to grow this business both organically and through accretive acquisitions, and Bozzetto is in advanced discussions with a potential target in the Americas.

Tufropes

Aimia owns a 100-per-cent equity stake in Tufropes, a global leader in the manufacturing of high-performance synthetic fibre ropes and netting solutions for global aquaculture, maritime and other various industrial customers:

• Tufropes reported revenues of $28.9-million for the three months ended June 30, 2023, with a loss before income taxes of $600,000, which included $300,000 of one-time transaction-related costs. Tufropes shipped 9,500 metric tonnes in the second quarter of 2023, compared with 8,200 metric tonnes shipped in the first quarter of 2023, which resulted in $25-million in revenues.
• The adjusted EBITDA for the second quarter of 2023 amounted to $4.6-million, representing an adjusted EBITDA margin of 15.9 per cent, which was temporarily softened as the business implements operating and growth initiatives. Tufropes expects to see a stronger second half of 2023 with respect to revenues and adjusted EBITDA. Adjusted EBITDA margins are expected to grow above 20 per cent within the next two years, based on reasonable assumptions such as operational improvement initiatives, as well as the optimization of product mix.
• On July 11, 2023, Tufropes acquired Cortland for $26.6-million, representing approximately seven times EBITDA. Cortland is a leading global designer, manufacturer and supplier of highly engineered synthetic ropes, slings and tethers to the aerospace and defence, marine, renewables, and other diversified industrial end-markets. The highly synergistic Cortland platform will accelerate Tufropes's global reach, expand its intellectual property portfolio and bolster its product offerings.
• The combined Tufropes and Cortland businesses will operate under the Cortland name, while retaining both the Cortland and Tufropes brands for their respective product portfolios.

Holdings segment results for Q2 2023

During the second quarter of 2023, the holdings segment reported a loss before income taxes of $39.4-million, mainly related to a negative net change in fair value of investments of $28.9-million and the non-cash share of net loss from Kognitiv of $8.9-million.

Selling, general and administrative expenses amounted to $7.2-million, up by $3.3-million versus the same quarter in the prior year, mainly resulting from $2.9-million of legal and professional fees incurred in relation to shareholder activism and the termination of the employment of a former executive of one of the company's subsidiaries.

Investment performance summary

Capital A

Capital A (formerly AirAsia) experienced significant growth in its aviation segments during the second quarter of 2023. The consolidated airlines segment achieved an 88-per-cent load factor, carrying 14.2 million passengers, nearly double the previous year, showing a rapid recovery toward prepandemic levels.

Clear Media

Aimia owns 10.85 per cent of Clear Media as of June 30, 2023. Clear Media is the largest operator of bus shelter advertising panels in China, with a network of 69,000 panels covering over 20 cities, and 573 digital panels as of June 30, 2023.

Due to the challenging macroeconomic environment in China, Clear Media continues to take steps to improve its cost structure, including reducing the number of lower-yielding panels in its portfolio in the second quarter of 2023. Clear Media expects revenues to improve meaningfully in the second half of 2023 versus the second half of 2022.

Kognitiv

Aimia owns a 48.9-per-cent equity stake in Kognitiv as of June 30, 2023. Kognitiv helps brands build deeper, more meaningful relationships with customers. Kognitiv's new product, Kognitiv Pulse, powered by AI (artificial intelligence) and machine learning, and Kognitiv's intelligent, omnichannel SaaS (software-as-a-service) platform delivers insights and automation to simplify the activation of customer data and deliver engaging consumer experiences at scale.

Kognitiv has implemented a series of initiatives to reduce costs and increase efficiency and, when combined with modest revenue growth, these are expected to result in positive adjusted EBITDA by year-end 2023. Kognitiv successfully closed the sale of a non-core business on Aug. 2, 2023, generating $9.4-million in net proceeds, with a potential earn-out, and expects to achieve EBITDA profitability in Q4 2023.

The associated table summarizes the performance of Kognitiv for the three and six months ended June 30, 2023, and 2022. A detailed analysis of its performance is available in the MD&A.

Trade X

Aimia owns an 11.9-per-cent fully diluted equity stake in Trade X as of June 30, 2023. With headquarters in Canada and a presence in multiple countries globally, Trade X is the first global vehicle marketplace to aggregate cross-border supply and demand for car dealers, fleet owners, rental companies, mobility solution providers, importers and exporters, opening new trading corridors to buy and sell vehicles.

Trade X generated gross vehicle sales of $193.3-million in the second quarter of 2023, a $29-million, or 13-per-cent, decrease from the same period last year, mainly the result of refocusing the business on its enhanced asset-light, higher-margin model as Trade X continues to drive toward profitability.

As a result of the lower sales volume, the company recorded unrealized fair value losses of $22.6-million and $2.3-million on its investment in convertible preferred shares and warrants, respectively, for the three months ended June 30, 2023. In addition, the company recorded a $1.7-million unrealized fair value loss in the same period on its Trade X convertible note.

Balance sheet and liquidity

As of June 30, 2023, Aimia had cash and cash equivalents of $63.9-million. In addition, Aimia had a liquid portfolio of equities and money-market funds which had a market value of $53-million. In total, Aimia had $116.9-million in cash, cash equivalents and liquid securities. Due to the uncertainty caused by the continuing shareholder activism, external debt financing at Tufropes has been delayed, which has in turn delayed the implementation of the NCIB (normal course issuer bid).

Available tax losses

Tax losses approximated $664-million as of June 30, 2023, composed of $269-million in capital losses and $395-million in net operating losses.

Aimia utilized approximately $130-million of net capital losses to mitigate capital gains on the repatriation of proceeds from foreign affiliates in the fourth quarter 2022.

Dividends

Dividends of $3.2-million were paid for the second quarter ended June 30, 2023, on the two series of outstanding preferred shares.

On Aug. 10, 2023, the board of directors of Aimia declared quarterly dividends of 30.0125 cents per Series 1 preferred share and 37.5688 cents per Series 3 preferred share, in each case payable on Sept. 29, 2023, to shareholders of record on Sept. 15, 2023.

Investor day

Aimia will hold an investor day on Sept. 27, 2023, at 9 a.m. ET in Toronto. Members of Aimia's executive leadership team will provide an update on its strategy and business, and leaders from Bozzetto, Tufropes, Kognitiv and Trade X will be presenting their respective businesses, and will be available for a subsequent question-and-answer session.

Due to limited capacity, in-person attendance is by invitation only and advance registration is required. To register to attend in person, please contact Aimia directly at IRandMedia@corp.aimia.com.

A live webcast link will be available on the investor relations section of the company's website. A replay of the webcast will be available on the website.

Quarterly conference call and audio webcast information

Aimia will host a conference call to discuss its second quarter 2023 financial results at 8:30 a.m. ET on Aug. 11, 2023. The call will be webcast on-line. A slide presentation intended for simultaneous viewing with the conference call and an archived audio webcast will be available for 90 days following the original broadcast available at the company's website.

Aimia's second quarter 2023 financial statements, MD&A, and financial highlights presentation will be filed on SEDAR+ around 7 a.m. ET on Aug. 11, 2023, as well as on Aimia's website under investor relations.

This earnings release was reviewed by Aimia's audit committee and was approved by Aimia's board of directors, on the audit committee's recommendation, prior to its release.

About Aimia Inc.

Aimia is a holding company that makes long-term investments in private and public businesses through controlling or minority stakes. It targets companies with durable economic advantages evidenced by a record of substantial free cash flow generation over complete business cycles, and strong growth prospects, and guided by strong, experienced management teams. Headquartered in Toronto, Canada, Aimia is positioned to invest in any sector, wherever a suitable opportunity can be identified worldwide. In addition, it seeks investments that may efficiently utilize the company's operating and capital loss carryforwards to further enhance stakeholder value.

We seek Safe Harbor.