Aimia launches strategic review after Aeroplan sale
MONTREAL Aimia Inc., which has seen its shares struggle in recent years, is launching a review of its strategic direction as it works to complete the sale of its flagship Aeroplan rewards program.
“While we have been able to deliver great service to our customers, our shareholders have not seen the same benefit,” chief executive Jeremy Rabe told a conference call with financial analysts Wednesday.
“As we invested in our global platform to grow the business, the cost base got ahead of our ability to generate new revenue, and more recently perceived uncertainty around Aimia contributed to client losses.”
The company’s board of directors has asked management to present it with alternative visions and plans for the company ’s future as it works to close the $450-million deal to sell Aeroplan to a consortium led by Air Canada.
The future of the program — whose buyers include TD Bank, CIBC and Visa Canada Corp. — had faced questions after Air Canada rolled out plans to start its own loyalty program in 2020 after its partnership Aimia was set to expire.
“Our focus now must be on realigning the shape of the business from where we are today and ensuring costs more closely reflect the future revenue mix,” Rabe told the conference call discussing the company’s third-quarter results.
“We have a new plan centered on simplification, efficiencies and core technologies and services.
The strategic review came as Aimia reported it earned $21.7 million or 11 cents per share in its third quarter, compared with a loss of $40.3 million or 29 cents per share in the same period last year.
Revenue totalled $372.7 million for the quarter ended Sept. 30, up from $350.5 million in the third quarter of 2017.
Adjusted net earnings per share climbed to 33 cents last quarter, compared to four cents per share at the same time last year, beating analysts’ expectations by more than 65 per cent, according to Thomson Reuters Eikon.