Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

Aeroplan cards from over the years are seen in this file photo.

The company that runs Aeroplan in Canada and other customer loyalty programs around the world says its third-quarter results were weaker than anticipated and it's planning a second round of cost-cutting measures.

Montreal-based Aimia Inc. says it expects more than 200 people will exit the business by the end of 2015 and suggested more jobs may be on the line next year.

The company says it has already booked $3-million in severance expenses related to a $20-million cost-cutting plan announced in August and expects that number to reach between $10-million and $15-million by the end of December.

Story continues below advertisement

Aimia also says weak economic conditions in Canada and Europe during the summer quarter have spurred the company to seek a further $20-million in annualized costs savings by the end of 2016.

"Further to these actions and to accelerate the reallocation of capital to higher margin parts of the business, Aimia has also engaged advisers to consider and evaluate potential disposals of non-core assets," Aimia said in its third-quarter report..

The company says it has been hit by a number of factors, including lower billings from Aeroplan – which manages points that can be exchanged for Air Canada tickets and upgrades as well as other goods and services.

It says Aeroplan billings were weaker than expected due to more constrained spending on credit cards issued by its banking partners. It also found the Sainsbury's grocery business in the United Kingdom issued fewer Nectar points than expected because of lower food prices and a change in strategy.

Aeroplan is also coping with a change in the way the credit card industry operates behind the scenes, a process that has resulted in less marketing by partners due to negotiations about interchange rates.

"We knew that 2015 would be challenging, due to, most significantly, the effects of interchange rate negotiations and the slowing economy," Aeroplan chief executive Rupert Duchesne said in a statement.

"As the impact of some of those issues became clearer, we took decisive action and have identified $40-million of annualized cost savings to be delivered over the next two years, to counter the economic uncertainty we are experiencing."

Story continues below advertisement

In the third quarter, Aimia's gross billings wee down 8.4 per cent from a year ago, falling to $580.3-million, and revenue was down 2.6 per cent to $529.3-million. Those declines would have been even bigger if currency exchange rate were constant.

Net loss for the quarter ended Sept. 30 was $26.1-million or 20 cents per share, an increase from $24.1-million or 17 cents per share. Adjusted net earnings per common share dropped 22.2 per cent to 14 cents from 18 cents per share.

Aimia says the weak quarter has prompted it to lower some of its financial estimates for a second time this year, including a drop in gross billings to a range of $2.4-billion and $2.46-billion for 2015.

The company had already lowered the estimate on Aug. 14 to a range of between $2.46-billion and $2.51-billion, down from its Feb. 27 guidance of a range of $2.56-billion and $2.61-billion.

Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies