Slide 1: Alliance Data Q3 2006
Alliance Data NYSE: ADS Q3 2006
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this presentation may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements may use words such as "anticipate,"
Slide 3: Alliance Data - Financial Profile
Alliance Data - Financial Profile Growth Company Double-digit Organic Growth Baseline Targets 12% Topline 15% EBITDA 18% Cash EPS Strong Visibility & Predictability Free Cash Flow > Reported Earnings Free Cash Flow > Reported Earnings Free Cash Flow > Reported Earnings Free Cash Flow > Reported Earn
Slide 4: 2000 - 2006 Revenue, Adj. EBITDA and Cash EPS
2000 - 2006 (in $MM, except per share) '00 '01 '02 '03 '04 '05 '06E '00 '01 '02 '03 '04 '05 '06E '00 '01 '02 '03 '04 '05 '06E $670 $770 $865 $1,047 $1,257 $1,552 $97 $123 $144 $211 $279 $350 $2.06 $1.54 $1.03 $0.59 $0.49 $0.40 Revenue ADJ. EBITDA Cash EPS 18% CAGR 30% CAGR 38% CAGR ^$1,840 ^$465 ^$2
Slide 5: Operating Leverage
Operating Leverage ADJ. EBITDA Margin Goal: 50bps Expansion per Year 16.0% 13.8% 14.5% 16.7% 20.1% '99 '00 '01 '02 '03 '04 '05 06E Averaging over 100 bps per Year 22.2% 22.6% 25.2%
Slide 6: 2006 Guidance
2006 Guidance Revenues ^$1.84 Billion EBITDA ^$465 Million Cash EPS ^$2.75 Free Cash/Share ^$2.95 Free Cash/Share ^$2.95 Free Cash/Share ^$2.95 Free Cash/Share ^$2.95 Free Cash/Share ^$2.95
Slide 7: 2006 Est. Free Cash Flow
2006 Est. Free Cash Flow ($MM, Except per Share) ADJ. EBITDA $465 Loyalty Cash Flow Adj. 25 Operating EBITDA $490 Less Capex / Int. / Taxes (248) Free Cash Flow $242 Per Share $2.95
Slide 8: Marketing Services (1) Canada: Loyalty
Marketing Services (1) Canada: Loyalty AIR MILES(r) Program Solid Mid-teens Growth Coalition Loyalty Program Based Upon Everyday Spend - - Not an Airline Program 2/3 of Canada Active Clients: Shell Oil, Safeway, American Express, Bank of Montreal Three Sources of Future Growth: New Sponsor Categorie
Slide 9: Marketing Services (cont.) (2) US: Epsilon
Marketing Services (cont.) (2) US: Epsilon Solid Mid-teens Growth Top 25 Clients: 10 Year Average Tenure Customer Management and Loyalty Solutions: Design and Management of Loyalty Databases Analytical Services Customized Marketing Campaigns Added BigFoot and Doubleclick 20Bn Permission Based E-mail
Slide 10: Utility Services
Utility Services Serving Both Regulated & De-regulated Services: Core Processing Customer Care / Call Center Database and Marketing Services Income Stream: Earnings Based on Monthly # Statements Clients: Duke, Entergy, Puget Sound, AEP, Centrica, Georgia Natural Gas, Orlando, City of Austin Market O
Slide 11: Private Label Market
Private Label Market Adding New Clients Expanding Into New Retail Segments Expanding Our Product Offering Consumer Commercial Co-Brand Gift Card Product Expansion Solid Foothold Market Leader Position Emerging Other Outdoor Recreation Hard Goods Jewelry Online/ Catalog Home Furnishings Apparel Consu
Slide 12: Services with Pricing Power
Services with Pricing Power Long-term Relationships 10 - 12 New Clients per Year 10 - 12 New Clients per Year 10 - 12 New Clients per Year 10 - 12 New Clients per Year Our Keys for Success