Slide 1: Investor Briefing: Acquisition and Capital Raising
Investor Briefing Acquisition and Capital Raising March 2003 PLIGHT CENTRE Cirens
Slide 2: Disclaimer
Disclaimer This presentation is not a recommendation, by ABN AMRO Morgans, Wilson HTM, Caliburn Partnership or Flight Centre Limited, that you invest in the securities. You should conduct and rely on your own investigations. This offer is only made to persons that fall within one of the exclusions f
Slide 3: Agenda
Agenda 1. 2. 3. 4. Executive Summary Transaction Overview Strategic Rationale Overview of Flight Centre Proforma Financials Capital Raising Summary Appendices ie
Slide 4: 1. Executive Summary
1. Executive Summary is) Flight Centre proposes to acquire Britannic, a leading UK corporate travel business Fixed acquisition price of £45.3 million (A$122 million) plus deferred profit share and performance payments* No additional debt from acquisition - £5.6** million (A$15 million) in cash on Br
Slide 5: 1. Executive Summary continued
1. Executive Summary conta Capital raising to fund initial payment and preserve balance sheet flexibility o A$79.6 million via a Non-Renounceable Entitlement Offer oO 1:20 at an Offer price of $18/share (11.3% discount to last price) Founders have taken up approximately 1.03 million shares (approxim
Slide 6: 2. Overview of Britannic
2. Overview of Britannic o Leading UK corporate travel agency o Focused on medium to large corporate accounts o Key clients include a number of major UK and multi-national corporations o Provides innovative, end-to-end, travel management solutions o Network of 24 offices and 40 locations throughout
Slide 7: 2. Financial Track Record
2. Financial Track Record o Britannic is a profitable company with a consistent track record Britannic’s Historical Financial Performance Year end Year end Year end (A$ million) Dec 2000 Dec 2001 Dec 2002 Revenue 421.8 440.9 432.7 EBIT 9.8 14.2 17.6 EBIT (% of revenue) 2.3% 3.2% 3.9% Notes: L. Assum
Slide 8: 2. Acquisition Summary
2. Acquisition Summary o Fixed acquisition price of £45.3 million (A$122 million) plus deferred profit share and performance payments — see Appendix A o 6,.3x pro-forma historical (CYO2) EBIT* o Synergies and cost savings from the acquisition not factored in o Acquisition is scheduled to complete in
Slide 9: 3. Immediate Scale in Key UK Market
3. Immediate Scale in Key UK Market o Britannic is a leading corporate travel agent in the United Kingdom o UK market will become Flight Centre’s second largest market (moves from 6% to 15% of total sales) GBP (millions) BHUK Carlson Rosenbluth Porwnan fhe Travel Britianic Phoenix ‘fravel P&C) Busin
Slide 10: 3. Developing a Global Platform
3. Developing a Global Platform o Further development of corporate travel platform, consistent with recent Hong Kong and ITG corporate acquisitions Aust/NZ US/Canada UK Hong Kong South Africa Small to Medium Focus Corporate Traveller Corporate Traveller Corporate Traveller American International Tra
Slide 11: 4. Overview of Flight Centre
4. Overview of Flight Centre Leading Australian travel retailer Rapidly expanding corporate travel operations In just 22 years, grown from single Sydney store to more than 1,000 shops and businesses Operations encompass Australia, New Zealand, UK, Canada, US, South Africa and Hong Kong ASX listed -
Slide 12: 4. Growth in Sales and Stores
4. Growth in Sales and Stores FLIGHT CENTRE ~ REVENUE SHOPS AND BUSINESSES ~- NUMBERS "Revenue (§ billion) 3.0 24 OO Bil es 7 1997 1998 1999 2000 ZO 2002, "No. of Shops and Busines 1997 1998 1999 2000 2004 2002 All graphs are years ended 30 June PLIGHT 11 CENTRE Cirens
Slide 13: 4. Growth in Profits
4. Growth in Profits FLIGHT CENTRE ~ EBIT PLIGHT CENTRE ~ NPAT OLS 44.0) 1997 1998 1999 2000 2001 2002 19? 1998 1999 200) ZL 2002, All graphs are years ended 30 June PLIGHT 12 CENTRE Cirens
Slide 14: 4. Recent Interim Result Highlights
4. Recent Interim Result Highlights 37% increase in sales (to A$2.14 billion) 47% increase in pre-tax profits (to A$44.94 million) Declared a fully franked interim dividend of 18.5 cents a share (48% increase) Flight Centre’s 1000* retail store now open At this time, we are unable to predict trading
Slide 15: 5. Proforma Financials
5. Proforma Financials o The acquisition enhances EPS on a historic pro-forma basis 0 + 3% post goodwill 0 + 9% pre goodwill o Synergies and cost savings have not been factored in o No additional debt from acquisition o Flight Centre will assume £5.6* million (A$15 million) in cash o Goodwill on acq
Slide 16: 6. Capital Raising
6. Capital Raising o Flight Centre is seeking to raise A$79.6 million via a Non- Renounceable Entitlement Offer o 1:20 at an Offer price of $18/share o Purpose of raising o Fund acquisition of Britannic (initial payment) whilst maintaining Flight Centre’s ability to capitalise on the opportunities p
Slide 17: 6. Capital Raising concluded
6. Capital Raising conc is) Institutional Entitlement Offer o Accelerated entitlement issue for Founders and Significant Institutional shareholders o Founders have committed to take up 1.03 million shares (approximately $18.5m) o Remaining Founder entitlements are to be placed with institutions Reta
Slide 18: 6. Key Dates
6. Key Dates Wed 5 March - Thurs 6 March Thurs 6 March Fri 7 March Tues 11 March Wed 19 March Tues 22 April Trading halt (48 hours) and Investor Roadshow Institutional Offer closes Announcement of Combined Offer and Acquisition Settlement of Institutional Offer Record date Dividend record date 17 PL
Slide 19: 7. Summary
7. Summary Sensible acquisition and good strategic fit Strengthens Flight Centre’s growing corporate business Provides scale in strategic UK market Experienced management team, with MD incentivised to remain with the business EPS enhancing - 2002 Synergies / cost savings (not factored in) Opportunit
Slide 20: Questions
Questions 19 PLIGHT CENTRE Cirens
Slide 21: Contact Details
Contact Details Mr Norman C. Fussell Chairman Flight Centre Limited Ph: 0419 772 063 Mr Shane Flynn Chief Executive Officer Flight Centre Limited Ph: 0439 710 023 Mr Jim Sturgess Chief Financial Officer Flight Centre Limited Ph: 0402 890 654 Mr Graham Turner Managing Director Flight Centre Limited P
Slide 22: Appendices
Appendices v CENTRE Cirens
Slide 23: A - Purchase Price
A - Purchase Price o Initial fixed component acquisition price of £45.3 million (A$122 million) o Initial payment: £30.58m (A$82.4m) Payable on completion o 24 payment: £6.16m (A$16.6m) Payable 18 months after completion o Balance (20%): £8.54m (A$23.0m) Payable at the end of 2007 o Performance base
Slide 24: B - Proforma Financial Performance
B - Proforma Financial Performance 12 MONTHS TO 31 DECEMBER 2002 FLIGHT PRO FORMA {A$ MILLION) CENTRE BRITANNIC ADJUSTMENTS CONSOLIDATED Revenue 4,173.1 432.7 0.0 4,605.8 EBIT 103.9 17.6 (5.0) 116.5 Profit after tax 72,2 12.9 (7.2) 779 ohana es pefore amortisation 861 93.8 - aceretion| (dilution) I%
Slide 25: C - Proforma Financial Position
C - Proforma Financial Position AS AT 31 DECEMBER 2002 PRO FORMA ($ MILLION) FLIGHT CENTRE BRITANNIC ADJUSTMENTS CONSOLIDATED Current Assets 357.6 37.0 (6.5) 388.1 Non Current Assets 164.4 24 100.1 266.9 Total Assets 552.0 39.4 93.6 655.0 Current Liabilities 203.2 21.0 17 225.9 Non Current Liabiliti