Points International Reports First Quarter 2009 Financial Results

    Business Highlights:

    -   Quarterly Revenue of $21.1 Million, Up Over 30% Year-Over-Year

    -   Principal Revenue of $19.4 Million, Up 48% Year-Over-Year

    -   Partnerships Signed in 2008 Contributing to Revenue

    -   Focused Investment Strategy Positioning the Company for Long-Term

    -   Company Reaffirms 2009 Guidance of Revenue in the Range of
        $85 Million to $95 Million With Third Straight Year of Positive

    TORONTO, May 6 /CNW/ - Points International Ltd. ("Points") - (OTCBB:
PTSEF, TSX: PTS) - the world's leading loyalty reward solutions provider and
owner of the Points.com portal - today announced results for the first quarter
of 2009 ended March 31, 2009. Financial results are in US Dollars.
    "Points began 2009 with 30% growth in total revenue and a 48% increase in
principal revenue year-over-year, demonstrating solid overall results and
strong execution, despite the most challenging economic environment in a
generation," said CEO Rob MacLean. "We remain encouraged by the business
prospects for the remainder of the year, overcoming a slow first few months of
2009 due to seasonality and the overall economy. We expect increased
promotional efforts in conjunction with our partners to more than offset any
economic pressures and furthermore we are benefitting from the investment we
made in partner and product implementations last year as these are now
increasingly contributing to revenue growth. Additionally, we are seeing
positive usage patterns as members use Points to monetize their banked loyalty
points and miles in order to save money in these tough times."
    "We are generating over $230 million of revenue for our partners annually
from less than 2% of their program members using the Buy, Gift, Transfer and
array of other services we provide. Increasing this penetration of our
e-Commerce services through targeted marketing, leveraging our unique data,
and consistently improving our underlying technical infrastructure represents
an enormous opportunity for both Points and our partners. This industry
leadership, activity and knowledge are keys to our ability to continue to
close a robust pipeline of new business opportunities. In parallel, we are
enhancing the options available on the Points.com consumer side of our
business where users can swap their points and miles for valuable products
from leading retailers including Amazon, Borders, Home Depot, iTunes and
Starbucks. Additionally we continue to build out our Global Points Exchange
(GPX) where users of one loyalty program can trade miles directly with users
of others. We are especially excited to have announced Continental Airlines
OnePass' upcoming participation in GPX, bringing the growing list of GPX
participating programs to thirteen and we expect to continue to regularly add
new programs this year. These are all components of a focused plan to bring
increased content and information to www.points.com that will be complimented
by an improved user flow and overall site design," added MacLean.

    First Quarter 2009 Financial Results

    Total revenue was $21.1 million for the first quarter of 2009. Revenue
grew 30% over the $16.2 million reported in the first quarter of 2008, and was
down compared to $21.7 million in the fourth quarter of 2008. Principal
revenue grew sharply to $19.4 million, up 48% over $13.0 million in the same
period last year, and was down from $19.7 million in the fourth quarter of
2008. Commission revenue was $1.8 million, down from $2.9 million reported in
the same period of last year and flat with the fourth quarter of 2008.
Interest revenue was $35,000, a decrease from $277,000 reported in the same
period last year and $216,000 in the fourth quarter of 2008.
    Points reported a net loss for the first quarter of 2009 of $1.1 million,
or ($0.01) per share. This compares to a net income of $801,760, or $0.01 per
share in the same period in the previous year, and a net loss of $3.0 million
or ($0.02) per share, in the fourth quarter of 2008, which included a $1.3
million impairment charge of long-lived assets and approximately $1.4 million
of foreign exchange related charges.
    During the first quarter of 2009, Points reported an EBITDA loss of
$580,000, compared to positive EBITDA of $584,000 in the same period of 2008
and positive EBITDA of $41,000 in the fourth quarter of 2008. Approximately
50% of the year over year change was attributable to both a worldwide
reduction in interest rates across currencies and the impact of some limited
margin concessions made later in 2008 to certain partners and discussed in
previous quarterly disclosures. There have been no further concessions made
during the intervening period. The sequential change in first quarter EBITDA
from fourth quarter 2008 was predominantly impacted by a combination of
historical seasonal trends, and the continued deterioration of interest
    As of March 31, 2009, Points' total cash, comprised of cash and cash
equivalents together with security deposits and amounts with payment
processors, was $32.9 million, up from $31.0 million at the end of the fourth
quarter of 2008. The Company carries no debt.

    New Board Member

    "We are pleased to welcome Bernay Box, a long-time shareholder and
supporter of the company, to our Board of Directors. Bernay brings more than
20 years of investment insight to Points and we expect to benefit from his
experience and contributions as we execute on our long-term strategy to drive
growth and profits from our business," said Stephen K. Bannon, the Company's

    Business Outlook

    "The trajectory of our business metrics, combined with aggressive
promotional plans from the leading loyalty programs around the world and
sizable new business opportunities provide us with confidence to reaffirm our
prior guidance calling for revenue growth in the range of $85 million to $95
million and a third year of positive EBITDA results. We are committed to an
investment strategy not only focused on continued strong growth but also
designed to generate positive cash over the year. A focused allocation of
between $5-7 million of our planned operating costs in 2009 toward this
aggressive growth will both bolster and diversify the e-Commerce business
while expanding the features, content and depth of our consumer-based
offerings and hastening the growth of Points.com, all while improving margins
over time," concluded Mr. Bannon.

    First Quarter 2009 Business Metrics

    Total All Channels:
    -   Total points/miles transacted during the first quarter was
        2.7 billion, bringing the total cumulative points/miles transacted to
        48.5 billion, a 33% increase over the first quarter of 2008
    -   The total number of transactions decreased 12% versus the same
        quarter last year to approximately 320,000

    Private Branded Channels:
    -   Total points/miles transacted on products distributed through
        Points' partner channels decreased 13% from the first quarter 2008 to
        2.5 billion bringing the cumulative total to 43.6 billion

    Points.com Channel:
    -   Cumulative points/miles transacted reached approximately 4.9 billion
        during the first quarter of 2009 on Points.com, a 33% increase versus
    -   Cumulative registered users on Points.com increased 15% year-over-
        year to 2.2 million

                                                    Q1/09               Q1/09
                                                     vs.                 vs.
                          Q1/09           Q4/08     Q4/08      Q1/08    Q1/08

       Transacted     2,727,601,671   3,057,918,099 -11%   3,084,632,504 -12%
      No. of
       Transactions         320,417         328,706  -3%         362,093 -12%
       Transacted    48,536,068,687  45,808,467,016   6%  36,573,543,123  33%


       Transacted     2,456,850,552   2,644,516,706  -7%   2,823,945,224 -13%
      No. of
       Transactions         298,101         300,526  -1%         342,908 -13%
       Transacted    43,604,510,371  41,147,659,819   6%  32,855,273,571  33%


       Transacted       270,751,119     413,401,393 -35%     260,687,280   4%
      No. of
       Transactions          22,316          28,180 -21%          19,185  16%
       Transacted     4,931,558,316   4,660,807,197   6%   3,718,269,553  33%
       Users              2,189,814       2,131,878   3%       1,905,213  15%

    (*) Points/Miles transacted were restated for Q1 2008 to normalize
        activity from a loyalty program whose loyalty program currency is
        valued differently than other programs. This resulted in a decrease
        in overall metrics for those periods.

    Investor Conference Call

    Points' quarterly conference call with Stephen K. Bannon, Chairman, Rob
MacLean, CEO, Christopher Barnard, President and Anthony Lam, CFO, will be
held today at 5:00 p.m. Eastern Time. To participate in the conference call,
investors from the U.S. and Canada should dial (888) 846-5003 ten minutes
prior to the scheduled start time. International callers should dial (480)
629-9856. Points will also offer a live and archived webcast of the conference
call, accessible from the "Investor Relations" section of the company's Web
site at www.pointsinternational.com.

    About Points International Ltd

    Points International Ltd. is the owner and operator of Points.com, the
world's leading reward program management Web site which was recently named
one of the 30 Best Travel Sites by Kiplinger's. At Points.com consumers can
Swap, Earn, Buy, Gift, Share and Redeem miles and points from more than 25 of
the world's leading reward programs. Participating programs include American
Airlines AAdvantage(R) program, Aeroplan(R), AsiaMiles(TM), British Airways
Executive Club, Wyndham Rewards(R), Delta SkyMiles(R) and InterContinental
Hotels Group's Priority Club(R) Rewards. Redemption partners include
Amazon.com(R) and Starbucks. For more information, visit

    Consumer Website: www.points.com
    Corporate Website: www.pointsinternational.com

    (1) EBITDA (Earnings (loss) before interest, taxes, amortization foreign
        exchange and impairment) is considered by management to be a useful
        supplemental measure of performance. However, EBITDA is not a
        recognized earnings measure under generally accepted accounting
        principles (GAAP).

    Caution Regarding Forward-Looking Statements

    This press release contains or incorporates forward-looking statements
within the meaning of the United States Private Securities Litigation Reform
Act of 1995, as amended, and forward-looking information within the meaning of
Canadian securities legislation (collectively "forward-looking statements").
All statements, other than statements of historical fact are forward-looking
statements. These forward-looking statements include statements relating to
our guidance for 2009 with respect to revenue and EBITDA, statements relating
to our objectives, strategic plans and business development goals, including
our planned investment in the business for 2009, and may also include other
statements that are predictive in nature or that depend upon or refer to
future events or conditions. Such forward-looking statements can generally be
identified by words such as "will," "may," "expects," "anticipates,"
"intends," "plans," "believes," "estimates" or similar expressions. In
addition, any statements that refer to expectations, projections or other
characterizations of future events or circumstances are forward-looking
statements. These statements are not historical facts but instead represent
only Points' expectations, estimates and projections regarding future events.
    Although Points believes the expectations reflected in such
forward-looking statements are reasonable, the forward-looking statements are
not guarantees of future performance and are subject to important risks and
uncertainties that are difficult to predict. Certain material assumptions or
estimates are applied in making forward-looking statements, and may not prove
to be correct. In particular, the revenue and EBITDA guidance, and planned
investment in the business for 2009, assume that Points' in-market products
and services will continue to perform along historical growth curves and that
transaction rates for newly launched products and services will grow in a
manner consistent with the Company's experience with its products in the
market. In addition, known and unknown factors could cause actual results to
differ materially from those expressed or implied in such statements.
Important factors that could cause actual results to differ materially are
referred to in the body of this news release and also include the risks and
uncertainties discussed herein, the matters set forth under "Risks and
Uncertainties" in Management's Discussion and Analysis filed with applicable
securities regulators and the factors detailed in Points' other filings with
applicable securities regulators, including the factors detailed in Points'
Annual Information Form, annual and interim financial statements and the notes
thereto. These documents are available at www.sedar.com and www.sec.gov.
    The forward-looking statements contained in this press release are made
as at the date of this release and, accordingly, are subject to change after
such date. Except as required by law, Points does not undertake any obligation
to update or revise any forward-looking statements made or incorporated in
this press release, whether as a result of new information, future events or

                          POINTS INTERNATIONAL LTD.
                     (Expressed in United States dollars)

    AS AT                                            March 31,   December 31,
                                                         2009           2008
      Cash and cash equivalents                  $ 25,190,950   $ 22,854,494
      Funds receivable from payment processors      4,724,305      5,065,722
      Short-term investments                          777,079        791,880
      Security deposits                             2,170,392      2,249,582
      Accounts receivable                           2,324,043      2,447,525
      Future income tax assets                        460,000        600,815
      Current portion of deferred costs               205,048        246,772
      Prepaid and sundry assets                     1,599,578      1,548,329
                                                -------------- --------------
                                                   37,451,395     35,805,119
                                                -------------- --------------

    PROPERTY AND EQUIPMENT                            847,783        808,648
    INTANGIBLE ASSETS                                 919,207        997,716
    GOODWILL                                        4,204,755      4,204,755
    DEFERRED COSTS                                    121,566        146,391
    OTHER ASSETS                                      440,427        751,843
                                                -------------- --------------
                                                    6,533,738      6,909,353
                                                -------------- --------------
                                                 $ 43,985,133   $ 42,714,472
                                                -------------- --------------
                                                -------------- --------------

      Accounts payable and accrued liabilities   $  1,936,846   $  3,217,409
      Current portion of deferred revenue             947,408      1,087,059
      Payable to loyalty program partners          29,622,565     25,966,589
                                                -------------- --------------
                                                   32,506,819     30,271,057

    DEFERRED REVENUE                                  235,980        259,220
                                                -------------- --------------
                                                   32,742,799     30,530,277
                                                -------------- --------------

                             SHAREHOLDERS' EQUITY

    ACCUMULATED OTHER COMPREHENSIVE LOSS           (2,566,230)    (2,566,230)
    ACCUMULATED DEFICIT                           (50,626,208)   (49,527,082)
                                                -------------- --------------
                                                  (53,192,438)   (52,093,312)

    CAPITAL STOCK                                  56,662,421     56,662,421
    CONTRIBUTED SURPLUS                             7,772,351      7,615,086
                                                -------------- --------------
                                                   11,242,334     12,184,195
                                                -------------- --------------
                                                 $ 43,985,133   $ 42,714,472
                                                -------------- --------------
                                                -------------- --------------

    (1) EBITDA (Earnings (loss) before interest, taxes, amortization foreign
        exchange and impairment) is considered by management to be a useful
        supplemental measure of performance. However, EBITDA is not a
        recognized earnings measure under generally accepted accounting
        principles (GAAP).

                          POINTS INTERNATIONAL LTD.
                     (Expressed in United States dollars)

    FOR THE THREE MONTHS ENDED MARCH 31,                 2009           2008
      Principal                                  $ 19,359,597   $ 13,041,025
      Commission                                    1,751,011      2,892,811
      Interest                                         35,375        276,916
                                                -------------- --------------
                                                   21,145,983     16,210,752
                                                -------------- --------------
      Direct cost of principal revenue             16,940,505     10,734,934
      Employment costs                              2,770,657      2,746,834
      Processing fees and related charges             585,536        822,550
      Marketing and communications                    467,877        361,658
      Technology services                             206,918        201,671
      Amortization of property and equipment           82,703        111,387
      Amortization of intangible assets                88,878        133,855
      Amortization of deferred costs                    1,629        120,360
      Foreign exchange loss/(gain)                    191,806       (884,784)
      Operating expenses                              754,505        759,385
                                                -------------- --------------
                                                   22,091,014     15,107,850
                                                -------------- --------------

    OPERATING (LOSS)/INCOME - before undernoted      (945,031)     1,102,902

      Interest on preferred shares                          -        291,061
      Interest and other charges                       13,280         10,081
                                                -------------- --------------

    (LOSS)/INCOME BEFORE INCOME TAXES                (958,311)       801,760

      Provision for future income taxes               140,815              -
                                                -------------- --------------

    NET (LOSS)/INCOME                            $ (1,099,126)  $    801,760
                                                -------------- --------------
                                                -------------- --------------

      Basic                                            ($0.01)         $0.01
      Diluted                                          ($0.01)         $0.01

    DEFICIT - Beginning of period                $(49,527,082)  $(45,972,044)
      NET (LOSS)/INCOME                            (1,099,126)       801,760
                                                -------------- --------------
    DEFICIT - End of period                      $(50,626,208)  $(45,170,284)
                                                -------------- --------------
                                                -------------- --------------

                          POINTS INTERNATIONAL LTD.
                     (Expressed in United States dollars)

    FOR THE THREE MONTHS ENDED MARCH 31,                 2009           2008

      Net (loss)/income for the period           $ (1,099,126)  $    801,760
                                                -------------- --------------
    Comprehensive (loss)/income                  $ (1,099,126)  $    801,760
                                                -------------- --------------
                                                -------------- --------------


      Balance - Beginning of period              $ (2,566,230)  $ (2,566,230)
                                                -------------- --------------
      Balance - End of period                    $ (2,566,230)  $ (2,566,230)
                                                -------------- --------------
                                                -------------- --------------

                          POINTS INTERNATIONAL LTD.
                     (Expressed in United States dollars)

    FOR THE THREE MONTHS ENDED MARCH 31,                 2009           2008
    Net (loss)/income                            $ (1,099,126)  $    801,760
    Items not affecting cash
      Amortization of property and equipment           82,703        111,387
      Amortization of deferred costs                    1,629        120,360
      Amortization of intangible assets                88,878        133,855
      Future income taxes                             140,815              -
      Unrealized foreign exchange loss/(gain)         317,182       (880,731)
      Employee stock option expense                   157,265        162,007
      Interest on Series Two and Four
       preferred shares                                     -        291,061
    Changes in non-cash balances related
     to operations                                  3,081,698      6,298,049
                                                -------------- --------------

    CASH FLOWS PROVIDED BY OPERATING ACTIVITIES     2,771,044      7,037,748
                                                -------------- --------------

      Additions to property and equipment            (121,838)       (92,905)
      Additions to intangible assets                  (10,369)       (76,253)
      Purchase of short-term investments                    -     (4,975,494)
                                                -------------- --------------
    CASH FLOWS USED IN INVESTING ACTIVITIES          (132,207)    (5,144,652)
                                                -------------- --------------

      Loan repayments                                       -         (5,927)
      Issuance of capital stock on exercise of
       stock options and warrants                           -         93,296
                                                -------------- --------------
    CASH FLOWS PROVIDED BY FINANCING ACTIVITIES             -         87,369
                                                -------------- --------------

     HELD IN FOREIGN CURRENCY                        (302,381)        86,252
                                                -------------- --------------

    INCREASE IN CASH AND CASH EQUIVALENTS           2,336,456      2,066,717

     of the period                                 22,854,494     21,535,978
                                                -------------- --------------

     the period                                  $ 25,190,950   $ 23,602,695
                                                -------------- --------------
                                                -------------- --------------

    Supplemental Information
      Interest Received                          $     48,239   $    273,932
      Interest Paid                              $     3,486    $      1,077

For further information:

For further information: Anthony Lam, Chief Financial Officer, Points
International Ltd., (416) 596-6382, anthony.lam@points.com; Alex Wellins or
Brinlea Johnson, The Blueshirt Group, (415) 217-7722, alex@blueshirtgroup.com,
or brinlea@blueshirtgroup.com

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