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Julie Gottlieb, SVP, Investor Relations
203.956.1032 (O) 203.209.1453 (M)
AFFINION GROUP, INC. ANNOUNCES RESULTS FOR THE FOURTH QUARTER
AND YEAR ENDED DECEMBER 31, 2009
DELIVERS INCREASE IN ADJUSTED EBITDA OVER 2008
NORWALK, Conn., February 25, 2010 Affinion Group, Inc. (Affinion or the Company), a global leader in customer engagement solutions that enhance and extend the relationship and loyalty of millions of consumers of financial service, retail, hospitality and e-commerce companies, announced today its financial results for the three- and twelve-month periods ended December 31, 2009 (the fourth quarter and full year, respectively).
In 2009, our overall business performance was solid throughout the year and we achieved our Adjusted EBITDA commitment despite the challenges to our business from the ongoing adverse macro-economic environment in the countries in which we operate, said Nathaniel J. Lipman, Affinions Chief Executive Officer. As we look to 2010, we anticipate some of the same factors that negatively affected our performance in 2009 will continue; and although we believe we have the right combination of business strategy, operating fundamentals and growth prospects to increase Adjusted EBITDA over 2009, we also believe it is both prudent and responsible to consider the downside potential of these and other headwinds and are, for now, providing guidance that 2010 Adjusted EBITDA will remain relatively flat. As the year progresses, and as our visibility continues to improve, we expect that we will provide further insight into our 2010 performance.
Note: readers are urged to review the section entitled Important Notes at the end of this release for a description of certain items affecting the results, including a definition of the term Transactions.
Fourth Quarter Net Revenues
Net revenues for the fourth quarter of 2009 remained relatively flat at $348.3 million, compared to $351.6 million for the fourth quarter of 2008.
The decrease in net revenues was due to a decline in North American products net revenue, as double-digit increases in both Loyalty and International products net revenue were offset by a higher cost of insurance and lower membership products revenue.
Excluding the $5.2 million benefit from foreign exchange in the quarter, which is derived by holding the currency rates from the fourth quarter of 2008 constant, net revenues would have declined 2.4% from the fourth quarter of 2008.
Fourth Quarter Operating Results
Adjusted EBITDA (as defined in Note (c) of Table 7) for the fourth quarter of 2009 was $78.1 million, compared to $79.0 million for the fourth quarter of 2008.
Segment EBITDA for the fourth quarter of 2009 was $68.2 million, compared to $76.7 million for the fourth quarter of 2008.
Excluding the impact of the Transactions, Segment EBITDA decreased $9.1 million, or 11.9%, resulting from lower North American net revenues, primarily due to the higher cost of insurance, as well as higher operating expenses in International partially offset by lower marketing and commissions.
The following information was filed by Affinion Group, Inc. on Thursday, February 25, 2010 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-K Annual Report statement of earnings and operation as management may choose to highlight particular information in the press release.
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