I'm still in the dark. How do they arrive at the $8 million valuation for the processing division? It's important because it would then be an asset of value and ultimately influence the stock price. If someone were to buy it, would want at least a 10% return or $800,000
But here are the income statements from the past 2 years. If the division has any value, it should be earning money, otherwise it can't be sold to anyone. I can't find any, other than information technology services for $15, 976? Most of the revenues earned were from Aeroplan and the Futura Rewards program.
2010
Billings
Third party loyalty currency $1,637,963 $1,260,851
Member rewards (Note 19(i)) 334,482 470,636
Administration fees 67,277 73,310
Advertising and promotion fees 15,750 26,623
Marketing materials 82,782 28,030
Information technology services 15,976 17,350
Credit card placement fees 2,611 3,494
Other 60 7,110
2,156,901 1,887,404
Less: Adjustment to net basis
Member rewards (Note 19(i)) (334,482) (470,636)
Plus: Unearned revenue from prior periods recognized in
the current period
Breakage revenue (Note 19(i)) 204,258 284,700
Administration fees 33,817 17,695
Less: Unearned administration fees for the period (57,620) (64,837)
Revenue recognized $2,002,874 $1,654,326