Transat A.t. Inc. · TSX:TRZ
Transat A.t — Shareholder Meeting (March 2015)
92 slides from Transat A.t's shareholder meeting presentation, Mar 12, 2015
Slide 1: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders
Slide 2: Jean-Marc Eustache, President and CEO
JEAN-MARC EUSTACHE President and Chief Executive Officer Annual and Special Meeting of Shareholders
Slide 3: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders
Slide 4: Denis Pétrin
DENIS PÉTRIN Vice-President, Finance & Administration Annual and Special and Chief Financial Officer Meeting of Shareholders
Slide 5: Bernard Bussières
BERNARD BUSSIÈRES Vice-President, General Counsel Annual and Special and Corporate Secretary Meeting of Shareholders
Slide 6: Agenda
AGENDA 1. Appointment of Scrutineers 2. Scrutineers’ Report and Quorum 3. Election of Directors 4. Appointment of Auditors 5. Resolution: Employee Share Purchase Plan 6. Resolution: 2009 Stock Option Plan 7. Resolution: Executive Compensation 8. Shareholder Proposals 9. President’s Message 10. Finan
Slide 7: Appointment of Scrutineers
APPOINTMENT OF Annual and Special SCRUTINEERS Meeting of Shareholders
Slide 8: Scrutineers' Report and Quorum
SCRUTINEERS’ REPORT AND Annual and Special Meeting of Shareholders QUORUM
Slide 9: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders
Slide 10: Election of Directors
ELECTION OF Annual and Special DIRECTORS Meeting of Shareholders
Slide 11: Raymond Bachand
RAYMOND BACHAND Strategic Advisor Norton Rose Fulbright
Slide 12: Louis-Marie Beaulieu
LOUIS-MARIE BEAULIEU Chairman of the Board and CEO Groupe Desgagnés Inc.
Slide 13: Lina De Cesare
¥< transat LINA DE CESARE Director
Slide 14: Jean Pierre Delisle
JEAN PIERRE DELISLE Corporate Director and Executor of Estates
Slide 15: W. Brian Edwards
W. BRIAN EDWARDS Corporate Director
Slide 16: Susan Kudzman
SUSAN KUDZMAN Senior Vice-President, Human Resources Laurentian Bank
Slide 17: Jean-Yves Leblanc
JEAN-YVES LEBLANC Lead Director Corporate Director
Slide 18: Jacques Simoneau
JACQUES SIMONEAU President and CEO, Corporate Director Gestion Univalor, s.e.c.
Slide 19: Philippe Sureau
¥< transat PHILIPPE SUREAU Director
Slide 20: Jean-Marc Eustache
JEAN-MARC EUSTACHE Chairman of the Board President and CEO Transat A.T. Inc.
Slide 21: Election of Directors
ELECTION OF Annual and Special DIRECTORS Meeting of Shareholders
Slide 22: Appointment of Auditors
APPOINTMENT OF Annual and Special AUDITORS Meeting of Shareholders
Slide 23: Resolution: Employee Share Purchase Program
RESOLUTION: EMPLOYEE SHARE Annual and Special PURCHASE PROGRAM Meeting of Shareholders
Slide 24: Resolution: 2009 Stock Option Plan
RESOLUTION: 2009 STOCK Annual and Special Meeting of Shareholders OPTION PLAN
Slide 25: Resolution: Executive Compensation
RESOLUTION: EXECUTIVE Annual and Special Meeting of Shareholders COMPENSATION
Slide 26: Shareholder Proposals
SHAREHOLDER Annual and Special PROPOSALS Meeting of Shareholders
Slide 27: Proposal 1
PROPOSAL 1 Annual and Special Meeting of Shareholders
Slide 28: Proposal 2
PROPOSAL 2 Annual and Special Meeting of Shareholders
Slide 29: Proposal 3
PROPOSAL 3 Annual and Special Meeting of Shareholders
Slide 30: Proposal 4
PROPOSAL 4 Annual and Special Meeting of Shareholders
Slide 31: President's Message
PRESIDENT’S Annual and Special MESSAGE Meeting of Shareholders
Slide 32: Jean-Marc Eustache
JEAN-MARC EUSTACHE President and Chief Executive Officer Annual and Special Meeting of Shareholders
Slide 33: Annual Results
ANNUAL RESULTS Adjusted net income (In millions of dollars) 62.6 2014 2013 53.7 45.2 REVENUES 3,752 3,648 ADJUSTED OPERATING INCOME 99.9 120.3 ADJUSTED NET INCOME 45.2 62.6 (9.7) (15.3) 2010 2011 2012 2013 2014
Slide 34: The Seasonality Challenge
THE SEASONALITY CHALLENGE 20% 10% November May to 80% to April 60% October 10% 20% Sun France Transatlantic
Slide 35: The Seasonality Challenge
THE SEASONALITY CHALLENGE 20% 10% November May to 80% to April 60% October 10% 20% Sun France Transatlantic
Slide 36: The Seasonality Challenge
THE SEASONALITY CHALLENGE 20% 10% November May to 80% to April 60% October 10% 20% Sun France Transatlantic
Slide 37: First Quarter 2015
FIRST QUARTER 2015 Q1-15 Q1-14 REVENUES 788.6 847.2 ADJUSTED OPERATING LOSS 35.8 23.9 NET LOSS 64.3 25.6
Slide 38: 2015–2017 Strategic Plan
2015–2017 STRATEGIC PLAN Transat : a travel brand that is well known and recognized by customers, suppliers, and at destination as a trusted partner that distributes the products travellers are looking for
Slide 39: 2015–2017 Strategic Plan
2015–2017 STRATEGIC PLAN International Arrivals 2010-2030 (In millions) Transat : a travel brand that is well known and recognized by customers, suppliers, and at destination as a trusted partner that distributes the products travellers are looking for
Slide 40: 2015–2017 Strategic Plan
2015-2017 STRATEGIC PLAN yc transat COST-REDUCTION CHANGES IN OUR AND MARGIN- DISTRIBUTION IMPROVEMENT STRATEGY INITIATIVES
Slide 41: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders
Slide 42: Cost Reductions 2012–2014
COST REDUCTIONS 2012–2014 (Compared to 2011) (In millions of dollars) 55 Staff reductions and administrative measures Changes to policies and processes at Air Transat 35 Start of narrow-body internalization 20 Cumulative savings: $55 million 2012 2013 2014
Slide 43: Cost Reductions and Margin Improvements 2015–2017
COST REDUCTIONS AND MARGIN IMPROVEMENTS 2015–2017 (Compared 2014) (In millions of dollars) 100 75 45 2015 2016 2017
Slide 44: A Major Innovation: The Flexible Fleet
A MAJOR INNOVATION: THE FLEXIBLE FLEET WINTER: 14 SUMMER: 21 WINTER: 14 SUMMER: 5
Slide 45: Densification of Three Airbus A330-300s
DENSIFICATION OF THREE AIRBUS A330-300s
Slide 46: Connecting-Flights Strategy
CONNECTING-FLIGHTS STRATEGY
Slide 47: Eco-Fares
ECO-FARES ys transat a ECO ECO extra | max | Club ne
Slide 48: Increase in Ancillary Revenues
INCREASE IN ANCILLARY REVENUES $60 M $49 M
Slide 49: Number of Flight Attendants
transat NUMBER OF FLIGHT ATTENDANTS see 25-gn8 eee “CLegge eee UUS-gee SEB oleae ase =| .088 SEB pee jt — gos Beng Bey BUY Bog2HRH
Slide 50: Continuing Technology Upgrades
CONTINUING TECHNOLOGY UPGRADES
Slide 51: Continuing Technology Upgrades
CONTINUING TECHNOLOGY UPGRADES
Slide 52: Continuing Technology Upgrades
CONTINUING TECHNOLOGY UPGRADES
Slide 53: Continuing Technology Upgrades
CONTINUING TECHNOLOGY UPGRADES @comres
Slide 54: Continuing Technology Upgrades
CONTINUING TECHNOLOGY UPGRADES Reduce time-to-market for new products Improve our responsiveness Effectively control distribution @comres channels Facilitate cross-selling Introduce new functionalities
Slide 55: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders
Slide 56: European Destinations
EUROPEAN DESTINATIONS transat IMPROVEMENT OF THE OFFERING ™
Slide 57: Sun Market
SUN MARKET transat IMPROVEMENT OF THE OFFERING transat
Slide 58: Three Main Collections
THREE MAIN COLLECTIONS yc transat L IMPROVEMENT OF THE OFFERING Ae Distinction Collection ¥ as HOTELS a aay # E =” HOTELS HOT ELS 2015 2017 2015 2017 2015 2017 21 30 27 AO 25 30
Slide 59: France Market
FRANCE MARKET yr transat
Slide 60: France Market
IMPROVEMENT OF THE OFFERING | VOYAGES *
Slide 61: France Market
IMPROVEMENT OF THE OFFERING ow, Looks J % ais } VOYAGES’
Slide 62: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders
Slide 63: Transat Distribution Canada: Renaissance Plan
TRANSAT DISTRIBUTION CANADA: RENAISSANCE PLAN Performance optimization Profitability improvements Relocations Improvements to key processes
Slide 64: Transat Travel
TRANSAT TRAVEL Migration of corporate agencies (cumulative) 59 34 14 More customers, more Transat sales 2014 2015 2016
Slide 65: Changes in Our Distribution Strategy
CHANGES IN OUR DISTRIBUTION STRATEGY 3 transat eucucccssssss m
Slide 66: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders
Slide 67: Acquisitions, Market Development and Continued Vertical Integration
MARKET DEVELOPMENT AND CONTINUED VERTICAL INTEGRATION
Slide 68: Expansion of Our International Footprint
EXPANSION OF OUR INTERNATIONAL FOOTPRINT
Slide 69: Hotel Development
HOTEL DEVELOPMENT 5,000 4,400 3,400 2,200 2014 2015 2016 2017
Slide 70: Think of us as your travel hosts
cal people and help communities Think of us as your travel hosts. (On land, at sea ard in the air Welcome y¢ transat
Slide 71: Jean-Marc Eustache
JEAN-MARC EUSTACHE President and Chief Executive Officer Annual and Special Meeting of Shareholders
Slide 72: Denis Pétrin
DENIS PÉTRIN Vice-President, Finance & Administration Annual and Special and Chief Financial Officer Meeting of Shareholders
Slide 73: Consolidated Statements of Income
CONSOLIDATED STATEMENTS OF INCOME (MILLIONS OF DOLLARS) 2014 2013 120.3 99.9 REVENUES 3,752.2 3,648.2 62.6 ADJUSTED OPERATING INCOME 99.9 120.3 45.2 ADJUSTED NET INCOME 45.2 62.6 NET INCOME ATTRIBUTABLE TO SHAREHOLDERS 22.9 58.0 2013 2014 ADJUSTED NET INCOME PER SHARE ($) 1.16 1.63 Adjusted operatin
Slide 74: 1st Quarter Results
1ST QUARTER RESULTS Variance of Canadian dollar (In millions of dollars) August 2014–January 2015 2015 2014 1 REVENUES 788.6 847.2 0.9 ADJUSTED OPERATING LOSS 35.8 23.9 0.8 in USD ADJUSTED NET LOSS 32.4 23.3 0.7 in EURO NET LOSS ATTRIBUTABLE TO SHAREHOLDERS 64.3 25.6 0.6 ADJUSTED NET LOSS PER SHARE
Slide 75: 1st Quarter Results
1ST QUARTER RESULTS (In millions de dollars) Weakened Canadian 2015 2014 dollar REVENUES 788.6 847.2 Non-correlated drop in fuel cost at airports ADJUSTED OPERATING LOSS 35.8 23.9 Increase in operating expenses resulting from ADJUSTED NET LOSS 32.4 23.3 fuel and FX NET LOSS ATTRIBUTABLE Over
Slide 76: Outlook
OUTLOOK Second quarter Sun: capacity 6% lower, 75% sold, load factors similar, selling prices up 1% Transatlantic: capacity 6% lower, 74% sold, load factors and selling prices similar France : bookings lower by 8% 2.2% increase in operating expenses Summer 2015 Transatlantic: capacity down
Slide 77: Strategic Plan
STRATEGIC PLAN Annual and Special Meeting of Shareholders
Slide 78: Cost and Margin Improvements
COST AND MARGIN IMPROVEMENTS (2015-2017) (In millions of dollars) 2015 2016 2017 100 COSTS Narrow-body flexible fleet 18 20 20 Reduction in the number of flight attendants 2 5 6 75 Buy-on-board (Sun destinations) 3 3 3 Optimization of hotel costs (Sun destinations) 2 9 12 Optimization of distributio
Slide 79: Cost and Margin Improvements
COST AND MARGIN IMPROVEMENTS (2015-2017) 2015 2016 2017 Operating expenses: COSTS $3.7 billion Narrow-body flexible fleet 18 20 20 Reduction in the number of flight attendants 2 5 6 Buy-on-board (Sun destinations) 3 3 3 Optimization of hotel costs (Sun destinations) 2 9 12 Optimization of distributi
Slide 80: Flexible Fleet
FLEXIBLE FLEET Financial impact narrow-body (achieved) (In millions of dollars) 20 20 18 2015 2016 2017
Slide 81: Ancillary Revenues
ANCILLARY REVENUES ON SAME BASIS Ancillary revenues on same basis (millions of dollars) 58 60 55 49 2014 2015 2016 2017
Slide 82: Hotels
HOTELS $650 M 1.30 1.20 1.25 0.95 1.10 1.15 1.00 1.05 2013-12-31 2014-01-31 2014-02-28 2014-03-31 2014-04-30 2014-05-31 2014-06-30 2014-07-31 2014-08-31 2014-09-30 Value of US dollar 2014-10-31 2014-11-30 in CAD 2014-12-31 January 1, 2014 to January 31, 2015 2015-01-31
Slide 83: Hotels
HOTELS Number of travellers Value of US dollar to Mexico and Caribbean January 1, 2014 to January 31, 2015 (2005-2013) (thousands of visitors) 1.30 Americans In CAD 23,000 1.25 22,000 1.20 21,000 20,000 1.15 19,000 1.10 1.05 Canadians 5,000 1.00 4,000 0.95 2014-06-30 2013-12-31 2014-07-31 2014-09-30
Slide 84: Hotels 2005-2013
HOTELS 2005-2013 Number of travellers Value of US dollar to Mexico and Caribbean January 1, 2014 to January 31, 2015 (2005-2013) (thousands of visitors) 1.30 Americans in CAD 23 000 1.25 22 000 1.20 21 000 20 000 1.15 19 000 1.10 1.05 Canadians 5 000 1.00 4 000 0.95 2014-06-30 2014-11-30 2013-12-31
Slide 85: In Summary
IN SUMMARY (In millions of dollars) 2015 2016 2017 100 COSTS Narrow-body flexible fleet 18 20 20 Reduction in the number of flight attendants 2 5 6 75 Buy-on-board (Sun destinations) 3 3 3 Optimization of hotel costs (Sun destinations) 2 9 12 Optimization of distribution costs 11 13 16 Other project
Slide 86: Consolidated Balance Sheet – As at January 31
CONSOLIDATED BALANCE SHEET – AS AT JANUARY 31 (In millions of dollars) 2015 2014 CASH 394 360 TOTAL ASSETS 1,683 1,585 INVESTMENT IN OCEAN 85 75 BALANCE SHEET DEBT 0 0 WORKING CAPITAL RATIO 1.05 1.07
Slide 87: Denis Pétrin
DENIS PÉTRIN Vice-President, Finance & Administration Annual and Special and Chief Financial Officer Meeting of Shareholders
Slide 88: Jean-Marc Eustache
JEAN-MARC EUSTACHE President and Chief Executive Officer Annual and Special Meeting of Shareholders
Slide 89: Results of the Vote
RESULTS OF THE VOTE Annual and Special Meeting of Shareholders
Slide 90: Question Period
QUESTION PERIOD Annual and Special Meeting of Shareholders
Slide 91: Adjournment of Meeting
ADJOURNMENT Annual and Special OF MEETING Meeting of Shareholders
Slide 92: Annual and Special Meeting of Shareholders
Annual and Special Meeting of Shareholders