Slide 1: Alliance Data Q2 2015 Results
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Alliance Data NYSE: ADS Q2 2015 ResultsJuly 23, 2015
Slide 2: Agenda
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Agenda Speakers: Ed Heffernan President and CEO Charles Horn EVP and CFO Bryan Pearson EVP and President of LoyaltyOne Second Quarter 2015 Consolidated ResultsSegment Results2015 Guidance and Critical
Slide 3: Second Quarter Consolidated Results
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Second Quarter Consolidated Results(MM, except per share) Quarter Ended June 30, Quarter Ended June 30, Quarter Ended June 30, 2015 2014 % Change Revenue $ 1,501 $ 1,265 +19% EPS $ 2.11 $ 2.19 -4% Cor
Slide 4: LoyaltyOne
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 LoyaltyOne (MM) Revenue was flat while adjusted EBITDA decreased 13 percent on a constant currency basis. Higher marketing expenses at AIR MILES and infrastructure expenses at BrandLoyalty reduced EBI
Slide 5: Epsilon
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Epsilon (MM) Organic revenue and adjusted EBITDA growth of 4 percent and 5 percent, respectively. Off-shoring initiative on-track, with expectations of approximately 350 employees by year-end. Solid a
Slide 6: Card Services
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Card Services (MM) Strong revenue growth driven by 33 percent growth in average card receivables during Q2.Substantial growth in card receivables drove solid expense leveraging. The provision for loan
Slide 7: Card Services Key Metrics
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Card Services (MM) Gross yield compression is due to mix (co-brand vs. PLCC). Loss rates were up slightly due to seasoning of 2013 start-up vintage. Core1 spending remains strong, up 9 percent. Ending
Slide 8: First Half Summary
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 1st Half, 2015 Revenue Adj. EBITDA, Net LoyaltyOne: BrandLoyalty $ 349 +41% $ 31 +29% Double digit top/bottom Canada 456 +4% 121 +2% +13% miles issued (-2% last year) Constant currency 805 +17% 152 +7
Slide 9: Conversant
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Conversant (+) (-) Pruning low/no margin products complete Pruning deeper than expected Signed cross-sale of $50 million in annual contract value / $75 to $80 million expected by year-end Too optimist
Slide 10: Conversant Year-Over-Year Growth Forecast
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Revenue Adj. EBITDA ADS Purchase Conversant Year-Over-Year Growth Forecast 9
Slide 11: 2015 Guidance and Critical Goals
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 2015 Guidance and Critical Goals Double-digit growth in revenue and adjusted EBITDANorth American expansion AIR MILES issuance growth returns to mid-single digit growthRevenue growth flows through to
Slide 12: Raising 2015 Guidance
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Raising 2015 Guidance($MM, except per share) 11 2014 2015 2015 ’15 / ’14 Increase Actual Original Guidance New Guidance Revenue $ 5,303 $ 6,500 $6,500 +23% Core EPS $ 12.56 $ 14.80 $15.00 +19% Diluted
Slide 13: Q & A
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Q & A
Slide 14: Safe Harbor Statement and Forward Looking Statements
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Safe Harbor Statement and Forward Looking Statements This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 2
Slide 15: Financial Measures
©2015 ADS Alliance Data Systems, Inc. Confidential and Proprietary Earnings Release | July 23, 2015 Financial Measures In addition to the results presented in accordance with generally accepted accounting principles, or GAAP, the Company may present financial measures that are non-GAAP measures, suc