Aimia reports third quarter results

Platform for Aeroplan growth now secured with all financial partnerships
in place

• Third quarter Gross Billings were $576.7 million, up 7.4 per cent compared to the same period in 2012, with year to date Gross Billings up
  4.9 per cent
• Adjusted EBITDA for the third quarter was $85.7 million, up by $4.2 million before reflecting the $12.2 million impact of the change in the Aeroplan breakage rate
• New agreements with all Aeroplan financial partners now confirmed, with
  new four year AMEX agreement effective from January 2014
• 2013 guidance unchanged

THIRD QUARTER HIGHLIGHTS1	Three Months Ended September 30,		Year Over Year
(in millions of Canadian dollars, except per share amounts)	2013	2012 2	% Change
	As Reported		As Reported	Constant Currency
Gross Billings	576.7	537.0	7.4	6.3
Total Revenue	499.7	498.8	0.2	(0.8)
Net Earnings	2.5	29.9	**	**
Earnings per Common Share	0.00	0.15	**	**
Adjusted EBITDA	85.7	93.7	(8.6)	(9.4)
Free Cash Flow before Dividends Paid	68.6	129.9	(47.2)	**
**Information not meaningful

1	Non-GAAP measures (Adjusted EBITDA and Free Cash Flow) and constant currency are explained in the section entitled Use of Non-GAAP Financial Information.  Discrepancies in variances on outlined highlights may arise due to rounding.
2	2012 financial information was restated to reflect the retroactive application of the amendments to IAS 19. Refer to Note 2 of Aimia’s Consolidated Financial Statements for the period ended September 30, 2013 for additional information.

MONTREAL, Nov. 13, 2013 /CNW Telbec/ – (TSX: AIM) Aimia today reported
its financial results for the third quarter and nine months ended
September 30, 2013. All financial information is in Canadian dollars
unless otherwise noted.

Rupert Duchesne, Group Chief Executive said:

“On a year to date basis, we have grown Gross Billings 5% and continued
to invest in a strong and stable platform for growth.  During the
quarter, we confirmed ten-year agreements with TD and CIBC, which will
put real momentum behind the transformed Aeroplan program.  We have
also today announced a new four year agreement with AMEX, which rounds
out an attractive financial card line-up to address the needs of
Aeroplan members. As we look forward to the fourth quarter, we will be
working with our Aeroplan financial card partners to position ourselves
for the launch of Distinction and an exciting range of very competitive
new financial card products which will be coming to the market starting
in January 2014.

Having these agreements in place gives us the financial flexibility to
be able to invest in other growth opportunities for Aimia as they
arise.  Loyalty coalitions and analytics continue to gain momentum
around the world through Aimia and our partners.  Together with China
Union Pay Merchant Services and Points International, we officially
launched the China Rewards coalition in October. The fourth quarter
will see Aimia deliver our ISS self-serve platform to US supermarket
chain Spartan and Cardlytics launch a new banking partner in the UK
with Lloyds Bank.”

Third Quarter Financial Highlights (Period ended September 30, 2013
versus period ended September 30, 2012, except where otherwise stated)

Consolidated – Year to date Gross Billings tracking well against full
year guidance

• Third quarter Gross Billings of $576.7 million, an increase of 7.4 per cent or 6.3 per cent on a constant currency basis compared to the same period of 2012, taking
  Gross Billings for the first nine months of 2013 to $1,708.4 million, an increase of 4.9 per cent or 4.6 per cent on a constant currency basis over 2012.
• Following strong growth in the second quarter of 2013, Gross Billings
  from Loyalty Units were $419.1 million, up 5.1 per cent compared to the third quarter of last year and up 3.9 per cent on a constant currency basis.
• Adjusted EBITDA for the third quarter was $85.7 million and $269.2 million on a year to date basis. This included the unfavorable impact of a
  change in the Breakage estimate in the Aeroplan Program in Canada of $12.2 million and $37.0 million for the three and nine months respectively. Additionally, distributions from PLM amounting to $3.5 million and $10.4 million were also included in the quarter and year to date respectively.
• Excluding the impact of the change in the Breakage estimate, Adjusted
  EBITDA was $97.9 million for the quarter.  Adjusted EBITDA on a year to date basis was $282.2 million excluding the impact of the change in Breakage estimate and the
  favorable impact resulting from the final judgment of the VAT
  litigation of $24.0 million.

Canada – Third quarter Gross Billings growth of 3.2 per cent, partly
driven by card acquisitions and strong program conversions; Agreements
with all Aeroplan financial partners confirmed

• Third quarter Gross Billings were $321.1 million compared with $311.1 million in the same period of 2012, an increase of 3.2 per cent mainly due to an increase in card acquisitions, higher program
  conversions, and higher proprietary loyalty volumes, offsetting the
  effect of the ongoing changes to the accumulation grid at Air Canada
  and lower average financial card spend. On a year to date basis, Gross Billings were down 0.3 per cent to $953.1 million.
• Gross Billings from Loyalty Units were up 2.8 per cent in the quarter.
• Adjusted EBITDA was $87.9 million in the third quarter, a decrease of 4.2 per cent compared to the $91.8 million recorded in the prior year period as a result of a $12.2 million adjustment resulting from the change in the Breakage estimate and
  higher marketing spend related to the launch of the Distinction
  program.  Partially offsetting this decline in Adjusted EBITDA was a
  significant improvement in unit cost from the prior year due to
  redemption mix, set against reinvestments in the value proposition
  during the third quarter of 2012.
• Excluding the impact of the change in the Breakage estimate, Adjusted
  EBITDA amounted to $100.1 million or 31.2 per cent (as a % of Gross Billings).
• Aeroplan Miles issuance rose 1.5 per cent in the third quarter while Aeroplan Miles redeemed fell 2.3 per cent to 17.0 billion ahead of the Distinction launch in January 2014.
• Aeroplan today confirmed that it has signed an agreement to extend its
  partnership with AMEX originally established in 2004, adding
  commitments to a new unique credit card product while continuing to
  build on the success of its existing charge card products.  The
  agreement will come into effect at the expiry of the existing agreement
  on January 1, 2014 for a term of four years.

Europe, Middle East & Africa (EMEA) – Operating leverage and the impact
of VAT ruling contributing to a significant improvement in EMEA
profitability on YTD basis

• Third quarter Gross Billings were $169.0 million, an increase of 5.1 per cent or 1.7 per cent on a constant currency basis compared to the same period of 2012. Gross
  Billings on a year to date basis were $504.1 million, up 9.0 per cent over 2012 and up 8.2 per cent on a constant currency basis.
• The increase in Gross Billings for the quarter was mainly from Loyalty
  Units issuance in the Nectar UK Program driven by the grocery sector
  and from the sale of Loyalty Units in the Air Miles Middle East program
  buoyed by enhanced member engagement and offset in part by the Nectar
  Italia program.
• Other Gross Billings in the quarter were down $4.8 million compared to 2012, mainly attributable to the UK Gross Billings
  transferred to the i2c joint venture from mid-January 2013.
• Adjusted EBITDA was $20.2 million in the quarter, with gross and operating margin leverage contribution resulting in an
  increase of $3.0 million.  Adjusted EBITDA for the first nine months was $80.6 million. Excluding the favourable impact from the final judgment of the VAT
  litigation in the second quarter, Adjusted EBITDA was $56.6 million on a year to date basis, up 72.1 per cent compared with the prior year period.
• Nectar UK Points issued in the quarter were up by 12.6 per cent compared to 2012, largely driven by higher activity from the grocery
  sector and by new Accumulation partners.  Redemption activity for
  Nectar UK rose by 12.2 per cent in the quarter mainly driven by an increase in the number of Nectar
  Points in circulation and promotional activity.
• Against higher levels of promotional bonuses in the third quarter last
  year and a challenging market environment, Nectar Italia accumulation
  was down 21.4 per cent for the quarter, with weaker accumulation also driving a 4.7 per cent decrease in redemptions. 
• In the Middle East, accumulation remained strong with an increase of 15.3 per cent for the quarter versus last year while redemptions were down
  significantly against the same period last year following strong
  redemption activity in the first six months of 2013.

US & Asia Pacific – Double digit growth in Gross Billings for the
quarter, with ongoing investments being incurred to support future
growth

• Third quarter Gross Billings were $86.6 million, an increase of 30.4 per cent or 29.5 per cent on a constant currency basis compared to the same period in 2012. Gross Billings on a year to date
  basis were up 18.2 per cent to $251.7 million or 17.3 per cent on a constant currency basis.
• Gross Billings from Excellence in Motivation (EIM), which was acquired
  on September 24, 2012, accounted for $12.3 million in the third quarter.
• Increased operating expenses due mostly to the inclusion of EIM, as well
  as EIM deferred compensation and increased compensation and technology
  investments to support future growth offset a small contribution from
  APAC, taking Adjusted EBITDA to $(2.4) million for the third quarter and $(12.3) million for the first nine months of 2013. Smart Button acquisition costs were
  also included in the quarter.

Cash Flow and Financial Position
At September 30, 2013, Aimia had $532.1 million of cash and cash equivalents, $35.0 million of restricted cash, $53.1 million of short-term investments and $280.6 million of long-term investments in bonds, for a total of $900.8 million.

Aimia’s Free Cash Flow (before dividends paid) was $68.6 million for the third quarter of 2013, compared to $129.9 million for the third quarter of 2012. The decrease was mainly driven by the
timing of working capital, higher operating expenses, and higher net
interest, offset in part by the increase in Gross Billings. On a year
to date basis, Free Cash Flow (before dividends paid) was $147.7 million.

Dividends Declared
Common Shares
The Board of Directors declared a quarterly dividend of $0.17 per common share, payable on December 31, 2013 to shareholders of record at the close of
business on December 17, 2013.

Preferred Shares
The Board also declared a quarterly dividend in the amount of $0.40625 per Cumulative Rate Reset Preferred Share, Series 1, payable on December 31, 2013 to the holders of record at the close of
business on December 17, 2013.

Dividends paid by Aimia to Canadian residents on both its common and
preferred shares are “eligible dividends” for Canadian income tax
purposes.

2013 Outlook

On June 27, 2013, Aimia announced financial adjustments related to
transformation of the Aeroplan Program.

On September 16, 2013, Aimia announced new ten-year financial credit
card agreements with TD and CIBC effective from January 1, 2014, and a
purchase agreement between TD, CIBC and Aimia under which TD would
acquire approximately half of the current Aeroplan card portfolio and
CIBC will retain the balance.  With the main condition of Competition
Bureau approval secured for the transaction and subject to remaining
closing conditions, Aimia expects the transaction to close during the
fourth quarter.

With the exception of the small change to the outlook with respect to
capital expenditures, Aimia is leaving its 2013 guidance, as updated on
September 16, 2013, unchanged.

For the year ending December 31, 2013, Aimia currently expects to report
the following:

Consolidated Outlook
		2012 Actual		Original Guidance (as provided on February 27, 2013)		Revised 2013 Target Range (Updated November 13, 2013)
Gross Billings		$2,243.0 million		Growth of between 3% and 5%		No change
Adjusted EBITDA		$402.6 million		To approximate $425 million		To approximate $350 million (excluding the impact of conveyance transaction) 1
Free Cash Flow before dividends paid		$299.5 million		Between $255 and $275 million		Target range of $230 to 250 million (excluding the impact of conveyance transaction) 1
Capital Expenditures		$58.0 million		To approximate $70 million		To approximate $65 million
Income Taxes		Canadian income tax rate of 26.2%		Aimia’s 2013 tax rate is anticipated to approximate 27% in Canada.  The Corporation expects no significant cash income taxes will be incurred in the rest of its foreign operations		No change to Aimia’s 2013 tax rate in Canada, however Aimia does not expect to be required to pay any further Canada cash tax installments in 2013 as a result of the realization of tax losses from the Breakage adjustment to net earnings of approximately $664 million incurred in the second quarter. No change to taxes in foreign operations.

1.

Payments related to the conveyance transaction include a $150 million payment to CIBC on closing (which is subject to the payment of harmonized sales tax) and a provision of up to $100 million related to migration (no cash payment would become due in relation to the migration payment until 2015 at the earliest).

Business Segment Gross Billings Growth Outlook
		2012 Actual		Original 2013 Target Range (as provided on February 27, 2013)		Revised 2013 Target Range (Updated September 16, 2013)
Canada		$1,292.6 million		Between 1% and 3%		At the lower end of the range of between 1% and 3%
EMEA		$639.9 million		Between 5% and 7%		No change
US & APAC		$315.2 million		Above 5%		No change

The above guidance excludes the effects of fluctuations in currency
exchange rates. In addition, Aimia made a number of economic and market
assumptions in preparing its 2013 forecasts, including assumptions
regarding the performance of the economies in which the Corporation
operates and market competition and tax laws applicable to the
Corporation’s operations. The Corporation cautions that the assumptions
used to prepare the forecasts for 2013, although reasonable at the time
they were made, may prove to be incorrect or inaccurate.  In addition,
the above forecasts do not reflect the potential impact of any
non-recurring or other special items or of any new material commercial
agreements, dispositions, mergers, acquisitions, other business
combinations or other transactions that may be announced or that may
occur after November 13, 2013. The financial impact of these
transactions and non-recurring and other special items can be complex
and depends on the facts particular to each of them. We therefore
cannot describe the expected impact in a meaningful way or in the same
way we presently know about the risks affecting our business.
Accordingly, our actual results could differ materially from our
expectations as set forth in this news release. The outlook provided
constitutes forward-looking statements within the meaning of applicable
securities laws and should be read in conjunction with the “Caution
Concerning Forward-Looking Statements” section.

Use of Non-GAAP Financial Information
In order to provide a better understanding of the results, the following
indicators are used:

Adjusted Earnings before Interest, Taxes, Depreciation and Amortization
EBITDA adjusted for certain factors particular to the business, such as
changes in deferred revenue and Future Redemption Costs (“Adjusted
EBITDA”), is used by management to evaluate performance, and to measure
compliance with debt covenants. Management believes Adjusted EBITDA
assists investors in comparing the Corporation’s performance on a
consistent basis without regard to depreciation and amortization, which
are non-cash in nature and can vary significantly depending on
accounting methods and non-operating factors such as historical cost.
Adjusted EBITDA also includes distributions and dividends received from
equity-accounted investments.

Adjusted EBITDA is not a measurement based on GAAP, is not considered an
alternative to operating income or net income in measuring performance,
and is not comparable to similar measures used by other issuers. For a
reconciliation to GAAP, please refer to the Summary of Consolidated
Operating Results and Reconciliation of EBITDA, Adjusted EBITDA,
Adjusted Net Earnings and Free Cash Flow included in the attached schedule. Adjusted EBITDA should not be used as
an exclusive measure of cash flow because it does not account for the
impact of working capital growth, capital expenditures, debt repayments
and other sources and uses of cash, which are disclosed in the
statements of cash flows.

Adjusted Net Earnings
Adjusted Net Earnings provides a measurement of profitability calculated
on a basis consistent with Adjusted EBITDA. Net earnings attributable
to equity holders of the Corporation are adjusted to exclude
Amortization of Accumulation Partners’ contracts, customer
relationships and technology, share of net earnings (loss) of equity
accounted investments and impairment charges. Adjusted Net Earnings
includes the Change in deferred revenue and Change in Future Redemption
Costs, net of the income tax effect and non-controlling interest effect
(where applicable) on these items at an entity level basis. Adjusted
Net Earnings also includes distributions and dividends received from
equity-accounted investments.

Adjusted Net Earnings is not a measurement based on GAAP, is not
considered an alternative to net earnings in measuring profitability,
and is not comparable to similar measures used by other issuers. For a
reconciliation to GAAP, please refer to the Summary of Consolidated
Operating Results and Reconciliation of EBITDA, Adjusted EBITDA,
Adjusted Net Earnings and Free Cash Flow included in the attached
schedule.

Standardized Free Cash Flow (“Free Cash Flow”)
Free Cash Flow is a non-GAAP measure recommended by the CICA in order to
provide a consistent and comparable measurement of free cash flow
across entities of cash generated from operations and is used as an
indicator of financial strength and performance.

Free Cash Flow is defined as cash flows from operating activities, as
reported in accordance with GAAP, less adjustments for:

	(a)	total capital expenditures as reported in accordance with GAAP; and
	(b)	dividends, when stipulated, unless deducted in arriving at cash flows from operating activities.

For a reconciliation to cash flows from operations please refer to the
Summary of Consolidated Operating Results and Reconciliation of EBITDA,
Adjusted EBITDA, Adjusted Net Earnings and Free Cash Flow included in
the attached schedule.

EBITDA and Free Cash Flow are non-GAAP measurements recommended by the
CICA in accordance with the recommendations provided in their October
2008 publication, Improved Communications with Non-GAAP Financial Measures – General
Principles and Guidance for Reporting EBITDA and Free Cash Flow.

Constant Currency
Because exchange rates are an important factor in understanding period
to period comparisons, the presentation of various financial metrics on
a constant currency basis or after giving effect to foreign exchange
translation, in addition to the reported metrics, helps improve the
ability to understand operating results and evaluate performance in
comparison to prior periods. Constant currency information compares
results between periods as if exchange rates had remained constant over
the periods. Constant currency is derived by calculating current-year
results using prior-year foreign currency exchange rates. Results
calculated on a constant currency basis should be considered in
addition to, not as a substitute for, results reported in accordance
with GAAP and may not be comparable to similarly titled measures used
by other companies.

Q3 2013 Conference Call / Audio Webcast
Aimia will host a conference call to discuss its third quarter 2013
financial results at 8:00 a.m. ET on Thursday, November 14, 2013. The
call can be accessed by dialing 1-888-231-8191 or 647-427-7450 for the
Toronto area. The call will be simultaneously audio webcast at: http://www.newswire.ca/en/webcast/detail/1059061/1151307

A slide presentation intended for simultaneous viewing with the
conference call will be available the evening of November 13, 2013, at:
https://www.aimia.com/English/Investors/Financial-Reports/Quarterly-Reports/default.aspx and an archived audio webcast will be available at: https://www.aimia.com/English/Investors/Presentations-and-Events/Events/default.aspx for ninety days following the original broadcast.

The audited consolidated financial statements and the MD&A will be
accessible on the investor relations website at: https://www.aimia.com/English/Investors/Financial-Reports/Quarterly-Reports/default.aspx.

About Aimia

Aimia Inc. (“Aimia” or the “Corporation”) is a global leader in loyalty
management. Employing more than 4,000 people in over 20 countries
worldwide, Aimia offers clients, partners and members proven expertise
in launching and managing coalition loyalty programs, delivering
proprietary loyalty services, creating value through loyalty analytics
and driving innovation in the emerging digital, mobile and social
communications spaces.

Aimia owns and operates Aeroplan, Canada’s premier coalition loyalty
program, Nectar, the United Kingdom’s largest coalition loyalty
program, Nectar Italia and Smart Button a leading provider of SaaS
loyalty solutions. In addition, Aimia owns stakes in Air Miles Middle
East, Mexico’s leading coalition loyalty program Club
Premier, Brazil’s Prismah Fidelidade, China Rewards – the
first coalition loyalty program in China that enables members to earn
and redeem a common currency, and i2c, a joint venture
with Sainsbury’s offering insight and data analytics services in
the UK to retailers and suppliers. Aimia also holds a minority position
in Cardlytics, a US-based private company operating in card-linked
marketing for electronic banking. Aimia is listed on the Toronto Stock
Exchange (TSX: AIM). For more information, visit us at www.aimia.com.

Caution Concerning Forward-Looking Statements

Forward-looking statements are included in this news release. These
forward-looking statements are identified by the use of terms and
phrases such as “anticipate”, “believe”, “could”, “estimate”, “expect”,
“intend”, “may”, “plan”, “predict”, “project”, “will”, “would”, and
“should” and similar terms and phrases, including references to
assumptions. Such statements may involve but are not limited to
comments with respect to strategies, expectations, planned operations
or future actions.

Forward-looking statements, by their nature, are based on assumptions
and are subject to important risks and uncertainties. Any forecasts,
predictions or forward-looking statements cannot be relied upon due to,
among other things, changing external events and general uncertainties
of the business and its corporate structure. Results indicated in
forward-looking statements may differ materially from actual results
for a number of reasons, including without limitation,  dependency on
top accumulation partners and clients, changes to the Aeroplan Program,
conflicts of interest, greater than expected redemptions for rewards,
regulatory matters, retail market/economic conditions, industry
competition, Air Canada liquidity issues, Air Canada or travel industry
disruptions, airline industry changes and increased airline costs,
supply and capacity costs, unfunded future redemption costs, failure to
safeguard databases and consumer privacy, changes to coalition loyalty
programs, seasonal nature of the business, other factors and prior
performance, foreign operations, legal proceedings, reliance on key
personnel, labour relations, pension liability, technological
disruptions and inability to use third party software, failure to
protect intellectual property rights, interest rate and currency
fluctuations, leverage and restrictive covenants in current and future
indebtedness, uncertainty of dividend payments, managing growth, credit
ratings, as well as the other factors identified in this news release
and throughout Aimia’s public disclosure record on file with the
Canadian securities regulatory authorities.

The forward-looking statements contained herein represent Aimia’s
expectations as of November 13, 2013, and are subject to change after
such date. However, Aimia disclaims any intention or obligation to
update or revise any forward-looking statements whether as a result of
new information, future events or otherwise, except as required under
applicable securities regulations.

SUMMARY OF CONSOLIDATED OPERATING RESULTS AND RECONCILIATION OF EBITDA,
ADJUSTED EBITDA, ADJUSTED NET EARNINGS AND FREE CASH FLOW

			Three Months Ended September 30,			Nine Months Ended September 30,			%Δ
(in thousands of Canadian dollars, except share and per share information)			2013		2012 (l)	2013		2012 (l)	Q3	YTD
Gross Billings			576,727		537,030	1,708,382		1,627,968	7.4	4.9
Gross Billings from the sale of Loyalty Units			419,143		398,885	1,246,703		1,198,895	5.1	4.0
Total revenue before change in Breakage estimate			519,768		498,781	1,669,540		1,570,739	4.2	6.3
Change in Breakage estimate (f)			(20,038)		—	(683,619)		—	100.0	100.0
Total revenue (as reported)			499,730		498,781	985,921		1,570,739	0.2	**
Cost of rewards and direct costs			(290,467)		(285,978)	(874,388)	(g)	(888,274)	1.6	(1.6)
Gross margin before depreciation and amortization (a)			209,263		212,803	111,533	(g)	682,465	(1.7)	**
Depreciation and amortization			(10,867)		(9,407)	(31,700)		(26,412)	15.5	20.0
Amortization of Accumulation Partners’ contracts, customer relationships and technology			(20,126)		(20,788)	(60,524)		(62,403)	(3.2)	(3.0)
Gross margin			178,270		182,608	19,309	(g)	593,650	(2.4)	**
Operating expenses			(157,059)		(131,186)	(508,593)	(g)	(412,951)	19.7	23.2
Amortization of Accumulation Partners’ contracts, customer relationships and technology			20,126		20,788	60,524		62,403	(3.2)	(3.0)
Operating income (loss) before amortization of Accumulation Partners’ contracts, customer relationships and technology			41,337		72,210	(428,760)	(g)	243,102	(42.8)	**
Depreciation and amortization			10,867		9,407	31,700		26,412	15.5	20.0
EBITDA (a)(c)			52,204		81,617	(397,060)	(g)	269,514	(36.0)	**
Adjustments:
Change in deferred revenue
		Gross Billings	576,727		537,030	1,708,382		1,627,968
		Total revenue	(499,730)		(498,781)	(985,921)		(1,570,739)
	Change in Future Redemption Costs (b)		(47,076)	(h)	(26,147)	(66,592)	(h)	(42,282)
		(Change in Net Loyalty Units outstanding x Average Cost of Rewards per Loyalty Unit for the period)
Distributions received from an equity-accounted investment			3,527		—	10,387		—
Subtotal of Adjustments			33,448		12,102	666,256		14,947
Adjusted EBITDA (c)			85,652	(h)	93,719	269,196	(g)(h)	284,461	(8.6)	(5.4)
Net earnings (loss) attributable to equity holders of the Corporation			2,070	(i)	28,295	(372,689)	(g)(i)(j)	108,610
Weighted average number of shares			172,529,307		172,034,083	172,400,541		172,683,579
Earnings (loss) per common share (d)			0.00	(i)	0.15	(2.21)	(g)(i)(j)	0.58
Net earnings (loss) attributable to equity holders of the Corporation			2,070	(i)	28,295	(372,689)	(g)(i)(j)	108,610
Amortization of Accumulation Partners’ contracts, customer relationships and technology			20,126		20,788	60,524		62,403
Share of net (earnings) loss of equity-accounted investments			4,480		(576)	8,072		(3,291)
Adjusted EBITDA Adjustments (from above)			33,448		12,102	666,256		14,947
Tax on adjustments (e)			(8,205)		619	(165,043)		5,373
Non-controlling interests share on adjustments above			(1,336)		23	(2,895)		(1,354)
Adjusted Net Earnings(c)			50,583	(h)(k)	61,251	194,225	(g)(h) (j)(k)	186,688	(17.4)	4.0
Adjusted Net Earnings per common share (c)(d)			0.28	(h)(k)	0.34	1.08	(g)(h) (j)(k)	1.03
Cash flow from operations			80,762		140,436	180,243		256,873
Capital expenditures			(12,183)		(10,516)	(32,525)		(34,449)
Dividends			(32,151)		(30,364)	(94,666)		(89,618)
Free Cash Flow (c)			36,428		99,556	53,052		132,806	(63.4)	(60.1)
Total assets			5,288,214		4,985,778	5,288,214		4,985,778
Total long-term liabilities			2,182,636		1,584,955	2,182,636		1,584,955
Total dividends per preferred share			0.406		0.406	1.219		1.219
Total dividends per common share			0.170		0.160	0.500		0.470

(a)	Excludes depreciation and amortization as well as amortization of Accumulation Partners’ contracts, customer relationships and technology.
(b)	The per unit cost derived from this calculation is retroactively applied to all prior periods with the effect of revaluing the Future Redemption Cost liability on the basis of the latest available average unit cost.
(c)	A non-GAAP measurement.
(d)	After deducting dividends declared on preferred shares.
(e)	The effective tax rates, calculated as income tax expense / earnings before taxes for the period on an entity level basis, are applied to the related entity level adjustments noted above.
(f)	The impact of the change in the Breakage estimate in the Aeroplan Program, which occurred in the second quarter of 2013, resulted in a reduction of $663.6 million to revenue from Loyalty Units, of which $617.0 million is attributable to the years prior to 2013 and $46.6 million to the six month period ended June 30, 2013. For the three months ended September 30, 2013, the change in Breakage estimate resulted in a reduction of $20.0 million to revenue from Loyalty Units.
(g)	Includes a favourable impact of $26.1 million (£16.4 million) resulting from the final judgment of the VAT litigation which occurred in the second quarter of 2013. Of this amount, $74.9 million (£47.0 million) was recorded as a reduction of cost of rewards and $48.8 million (£30.6 million) as an increase to operating expenses. Prior to the issuance of the final ruling, Aimia had recorded an amount of $2.1 million (£1.4 million) in cost of rewards, representing input tax credits accrued during the period from January 1, 2013 to March 31, 2013.
(h)	The Change in Future Redemption costs for the three and nine months ended September 30, 2013 includes the unfavourable impact resulting from the change in the Breakage estimate in the Aeroplan Program, which occurred during the second quarter of 2013, and amounted to $12.2 million and $37.0 million, respectively.
(i)	Includes the unfavourable impact of the change in Breakage estimate in the Aeroplan Program, which occurred in the second quarter of 2013, of $14.6 million and $498.4 million for the three and nine months ended September 30, 2013, respectively, net of income tax recoveries of $5.4 million and $185.2 million, respectively.
(j)	Includes the favourable impact of the reversal of previously accrued interest of $17.3 million (£10.8 million) resulting from the final judgment of the VAT litigation which occurred in the second quarter of 2013. Prior to the issuance of the final ruling, Aimia had recorded an amount of $1.1 million (£0.7 million) as interest expense during the period from January 1, 2013 to March 31, 2013.
(k)	Includes the unfavourable impact to the Change in Future Redemption costs resulting from the change in Breakage estimate in the Aeroplan Program, which occurred in the second quarter of 2013 of $8.9 million and $27.3 million for the three and nine months ended September 30, 2013, respectively, net of income tax recoveries of $3.3 million and $9.7 million, respectively.
(l)	2012 financial information was restated to reflect the retroactive application of the amendments to IAS 19. Refer to Note 2 of Aimia’s consolidated financial statements for the period ended September 30, 2013 for additional information.
**	Information not meaningful.

SEGMENTED INFORMATION

At September 30, 2013, the Corporation had three reportable and
operating segments: Canada, EMEA and US & APAC. The tables below
summarize the relevant financial information by operating segment:

		Three Months Ended September 30,
(in thousands of Canadian dollars)		2013		2012(j)	2013		2012		2013		2012		2013		2012	2013	2012	2013		2012(j)
Operating Segments		Canada			EMEA				US & APAC				Corporate(b)			Eliminations		Consolidated
Gross Billings		321,134		311,082	169,042	(c)	160,804	(c)	86,602	(c)	66,388	(c)	—		—	(51)	(1,244)	576,727	(c)	537,030	(c)
Gross Billings from the sale of Loyalty Units		269,346		262,063	149,797		136,822		—		—		—		—	—	—	419,143		398,885
Revenue from Loyalty Units before change in Breakage estimate		255,810		259,694	107,921		101,922		—		—		—		—	—	—	363,731		361,616
Change in Breakage estimate (f)		(20,038)		—	—		—		—		—		—		—	—	—	(20,038)		—
Revenue from Loyalty Units (reported)		235,772		259,694	107,921		101,922		—		—		—		—	—	—	343,693		361,616
Revenue from proprietary loyalty services		40,076		35,504	4,567		3,637		85,016		64,880		—		—	—	—	129,659		104,021
Other revenue		11,785		12,944	14,593		20,200		—		—		—		—	—	—	26,378		33,144
Intercompany revenue		—		—	51		49		—		1,195		—		—	(51)	(1,244)	—		—
Total revenue		287,633		308,142	127,132		125,808		85,016		66,075		—		—	(51)	(1,244)	499,730		498,781
Cost of rewards and direct costs		157,579		167,348	84,984		84,832		47,904		33,847		—		—	—	(49)	290,467		285,978
Gross margin before depreciation and amortization		130,054		140,794	42,148		40,976		37,112		32,228		—		—	(51)	(1,195)	209,263		212,803
Depreciation and amortization (a)		24,003		23,381	4,153		4,389		2,837		2,425		—		—	—	—	30,993		30,195
Gross margin		106,051		117,413	37,995		36,587		34,275		29,803		—		—	(51)	(1,195)	178,270		182,608
Operating expenses before the undernoted		58,333		51,638	34,110		32,963		41,122		33,264		17,609		11,275	(51)	(1,195)	151,123		127,945
	Share-based compensation	—		—	—		—		—		—		5,936		3,241	—	—	5,936		3,241
Total operating expenses		58,333		51,638	34,110		32,963		41,122		33,264		23,545		14,516	(51)	(1,195)	157,059		131,186
Operating income (loss)		47,718		65,775	3,885		3,624		(6,847)		(3,461)		(23,545)		(14,516)	—	—	21,211		51,422
Adjusted EBITDA (i)		87,908	(g)	91,770	20,186		17,188		(2,424)		(723)		(20,018)	(h)	(14,516)	—	—	85,652	(g)(h)	93,719
Additions to non-current assets (d)		6,812		5,878	4,477		3,271		894		1,367		—		—	N/A	N/A	12,183		10,516
Non-current assets (d)		3,137,540		3,205,993	483,562	(e)	457,567	(e)	88,594	(e)	81,113	(e)	2,170		2,246	N/A	N/A	3,711,866	(e)	3,746,919	(e)

(a)	Includes depreciation and amortization as well as amortization of Accumulation Partners’ contracts, customer relationships and technology.
(b)	Includes expenses that are not directly attributable to any specific operating segment. Corporate also includes the financial position and operating results of our operations in India.
(c)	Includes third party Gross Billings of $139.6 million in the UK and $51.8 million in the US for the three months ended September 30, 2013, compared to third party Gross Billings of $130.6 million in the UK and $39.0 million in the US for the three months ended September 30, 2012. Third party Gross Billings are attributed to a country on the basis of the country where the contractual and management responsibility for the customer resides.
(d)	Non-current assets include amounts relating to goodwill, intangible assets and property and equipment.
(e)	Includes non-current assets of $432.6 million in the UK and $83.1 million in the US as of September 30, 2013, compared to non-current assets of $407.6 million in the UK and $74.5 million in the US as of September 30, 2012.
(f)	The impact of the change in the Breakage estimate in the Aeroplan Program, which occurred in the second quarter of 2013, resulted in a reduction of $20.0 million to revenue from Loyalty Units for the three months ended September 30, 2013.
(g)	The Change in Future Redemption costs for the three months ended September 30, 2013 includes the unfavourable impact of $12.2 million resulting from the change in the Breakage estimate in the Aeroplan Program which occurred in the second quarter of 2013.
(h)	Adjusted EBITDA includes a distribution received from an equity-accounted investment, PLM, amounting to $3.5 million for the three months ended September 30, 2013.
(i)	A non-GAAP measurement.
(j)	2012 financial information was restated to reflect the retroactive application of the amendments to IAS 19. Refer to Note 2 of Aimia’s consolidated financial statements for the period ended September 30, 2013 for additional information.

		Nine Months Ended September 30,
(in thousands of Canadian dollars)		2013		2012(k)	2013		2012		2013		2012		2013		2012	2013	2012	2013		2012(k)
Operating Segments		Canada			EMEA				US & APAC				Corporate(b)			Eliminations		Consolidated
Gross Billings		953,052		956,319	504,074	(c)	462,265	(c)	251,665	(c)	212,940	(c)	—		—	(409)	(3,556)	1,708,382	(c)	1,627,968	(c)
Gross Billings from the sale of Loyalty Units		796,432		801,013	450,271		397,882		—		—		—		—	—	—	1,246,703		1,198,895
Revenue from Loyalty Units before change in Breakage estimate		851,657		841,845	354,238		304,631		—		—		—		—	—	—	1,205,895		1,146,476
Change in Breakage estimate (f)		(683,619)		—	—		—		—		—		—		—	—	—	(683,619)		—
Revenue from Loyalty Units (reported)		168,038		841,845	354,238		304,631		—		—		—		—	—	—	522,276		1,146,476
Revenue from proprietary loyalty services		120,607		112,855	12,562		10,915		253,278		210,479		—		—	—	—	386,447		334,249
Other revenue		35,882		37,185	41,316		52,829		—		—		—		—	—	—	77,198		90,014
Intercompany revenue		—		12	172		256		237		3,288		—		—	(409)	(3,556)	—		—
Total revenue		324,527		991,897	408,288		368,631		253,515		213,767		—		—	(409)	(3,556)	985,921		1,570,739
Cost of rewards and direct costs		533,364		520,447	200,641	(h)	256,061		140,383		112,034		—		—	—	(268)	874,388	(h)	888,274
Gross margin before depreciation and amortization		(208,837)		471,450	207,647	(h)	112,570		113,132		101,733		—		—	(409)	(3,288)	111,533	(h)	682,465
Depreciation and amortization (a)		71,950		69,913	11,918		12,124		8,356		6,778		—		—	—	—	92,224		88,815
Gross margin		(280,787)		401,537	195,729	(h)	100,446		104,776		94,955		—		—	(409)	(3,288)	19,309	(h)	593,650
Operating expenses before the undernoted		165,924		165,783	156,569	(h)	105,085		123,562		100,259		49,352		35,088	(409)	(3,288)	494,998	(h)	402,927
	Share-based compensation	—		—	—		—		—		—		13,595		10,024	—	—	13,595		10,024
Total operating expenses		165,924		165,783	156,569	(h)	105,085		123,562		100,259		62,947		45,112	(409)	(3,288)	508,593	(h)	412,951
Operating income (loss)		(446,711)		235,754	39,160	(h)	(4,639)		(18,786)		(5,304)		(62,947)		(45,112)	—	—	(489,284)	(h)	180,699
Adjusted EBITDA (j)		253,448	(g)	296,054	80,588	(h)	32,872		(12,280)		647		(52,560)	(i)	(45,112)	—	—	269,196	(g)(h)(i)	284,461
Additions to non-current assets (d)		19,087		19,918	11,676		9,711		1,762		4,820		—		2,273	N/A	N/A	32,525		36,722
Non-current assets (d)		3,137,540		3,205,993	483,562	(e)	457,567	(e)	88,594	(e)	81,113	(e)	2,170		2,246	N/A	N/A	3,711,866	(e)	3,746,919	(e)

(a)	Includes depreciation and amortization as well as amortization of Accumulation Partners’ contracts, customer relationships and technology.
(b)	Includes expenses that are not directly attributable to any specific operating segment. Corporate also includes the financial position and operating results of our operations in India.
(c)	Includes third party Gross Billings of $402.9 million in the UK and $158.7 million in the US for the nine months ended September 30, 2013, compared to third party Gross Billings of $376.8 million in the UK and $124.5 million in the US for the nine months ended September 30, 2012. Third party Gross Billings are attributed to a country on the basis of the country where the contractual and management responsibility for the customer resides.
(d)	Non-current assets includes amounts relating to goodwill, intangible assets and property and equipment.
(e)	Includes non-current assets of $432.6 million in the UK and $83.1 million in the US as of September 30, 2013, compared to non-current assets of $407.6 million in the UK and $74.5 million in the US as of September 30, 2012.
(f)	The impact of the change in the Breakage estimate in the Aeroplan Program, which occurred in the second quarter of 2013, resulted in a reduction of $663.6 million to revenue from Loyalty Units, of which $617.0 million is attributable to the years prior to 2013 and $46.6 million to the six month period ended June 30, 2013. For the three months ended September 30, 2013, the change in Breakage estimate resulted in a reduction of $20.0 million to revenue from Loyalty Units.
(g)	The Change in Future Redemption costs for the nine months ended September 30, 2013 includes the unfavourable impact resulting from the change in the Breakage estimate in the Aeroplan Program, which occurred in the second quarter of 2013, and amounted to $37.0 million, of which $24.8 million is attributable to the six months ended June 30, 2013 and $12.2 million to the three months ended September 30, 2013.
(h)	Includes a favourable impact of $26.1 million (£16.4 million) resulting from the final judgment of the VAT litigation which occurred in the second quarter of 2013. Of this amount, $74.9 million (£47.0 million) was recorded as a reduction of cost of rewards and $48.8 million (£30.6 million) as an increase to operating expenses. Prior to the issuance of the final ruling, Aimia had recorded an amount of $2.1 million (£1.4 million) in cost of rewards, representing input tax credits accrued during the period from January 1, 2013 to March 31, 2013.
(i)	Adjusted EBITDA includes distributions received from an equity-accounted investment, PLM, amounting to $10.4 million for the nine months ended September 30, 2013.
(j)	A non-GAAP measurement.
(k)	2012 financial information was restated to reflect the retroactive application of the amendments to IAS 19. Refer to Note 2 of Aimia’s consolidated financial statements for the period ended September 30, 2013 for additional information.

 

 

SOURCE AIMIA

 

Contact:

Media
Krista Pawley
416-352-3794
krista.pawley@aimia.com

Analysts & Investors
Karen Keyes
416-352-3728
karen.keyes@aimia.com

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