EXHIBIT 99.1
Slide 1
(logo): USA Interactive
Dara Khosrowshahi, Executive Vice President & Chief Financial Officer
CIBC Gaming, Lodging, Travel & Leisure Conference
February 26th, 2003
Prepared 2/26/03 - Read important disclaimer(s)
Slide 2: Important
This presentation contains forward looking statements relating to possible or
assumed future results of USA. It reflects the views of USA with respect to
future events, and is subject to risks that could cause future results to
materially differ. These risks are described in USA's Securities and Exchange
Commission filings. Information contained herein about entities other than USA
has been obtained from sources believed to be reliable, but no independent
verification has been made and no representation is made as to its accuracy or
completeness. Any statements non-factual in nature constitute opinions, which
are subject to change without notice. The forward looking statements and
opinions in this presentation are made as of the date of this presentation
unless otherwise noted, and USA undertakes no obligation to update or revise
them for any reason. These statements do not include the potential impact of any
mergers, acquisitions or other business combinations that may be completed in
the future other than as noted.
This presentation refers to budgeted data from the USA 2003 budget released on
February 6, 2003. The budgeted data is as of February 6, 2003 and is not being
updated or confirmed as of the date hereof. Pro forma financial information
includes the results from Expedia as of January 1, 2001, and is pro forma for
the exchange of Holdco shares by Liberty, the Vivendi transaction and the
Ticketmaster merger as if they had occurred on January 1, 2001.
Free Cash Flow is defined as Net Cash Provided by Operating Activities from
continuing operations, less capital expenditures, investments to fund HSN
International unconsolidated operations and preferred dividends paid. EBITA is
defined as defined as operating income plus amortization of (1) non-cash
compensation, (2) non-cash distribution and marketing and (3) other intangibles
(and goodwill in 2001), (4) non-recurring items and (5) HSN disengagement costs.
Adjusted Net Income generally captures all income statement items that have
been, or will ultimately be, settled in cash and is defined as net income
available to common shareholders plus: (1) amortization of non-cash distribution
and marketing expense, (2) amortization of non-cash compensation expense, (3)
amortization of intangibles (and goodwill in 2001), net of related tax and
minority interest expense, (4) equity income or loss from USA's 5.44% interest
in VUE, and (5) non-recurring items and/or restructuring charges. Adjusted EPS
is defined as Adjusted Net Income divided by fully diluted shares outstanding
for Adjusted EPS purposes. For reconciliations from non-GAAP to GAAP metrics,
please refer to www.usainteractive.com.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 3: $13 Billion in Transactions
Electronic Retailing
(logos) HSN, America's Store, Shop Channel, TVSN, HOT, Nuen Live
Travel
(logos) Expedia, Hotels.com, Interval International, TV Travel Shop
Information & Services
(logos) Ticketmaster, Match.com, uDate.com (transaction pending),evite
Citysearch, PRC, EPI (transaction pending)
Note: Includes some companies majority or partially owned by USA.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 4: 2002 Financial Highlights
$ in millions. Pro forma adjusted.
Gross Transaction Value
2001: $9,033 Growth=43%
2002: $12,903
Revenue
2001: $3,766 Growth=24%
2002: $4,657
Gross Profit
2001: $1,341 Growth=37%
2002: $1,834
Operating Expenses (a)
2001: $1,431 Growth=17%
2002: $1,684
Operating Income
2001: (90) Growth=N/A
2002: $150
EBITA Growth=133%
2001: $193
2002: $448
Adjusted Net Income:
2001: $123 Growth=93%
2002: $236
(a) Not including One-time items of $26 million and $121 million in 2001 and
2002, respectively.
Source: USA 2003 budget released on 2/26/03.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 5: Transactions Through the Screen
2000
Subscriptions/Fees: 15%
Transactions: 44%
Advertising: 41%
2005
Subscriptions/Fees: 13%
Transactions: 65%
Advertising: 22%
CAGR: '00-'05
Advertising 3%
Subscriptions / Fees 13%
Transactions 26%
Transactions "through the screen" represent consumer related interactive
transactions through television and the personal computer compiled as of
1/29/02. Includes financial services and online classifieds compiled estimates
per MSDW, Jupiter, Shop.org, McCann Erickson, Zenith Media, Paul Kagan,
Prudential, Furman Selz, PaineWebber, SSB, and Forrester.
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Slide 6: Strategic Priorities
Drive Online Migration
Grow Preeminent Brands
Maximize Customer Value
Invest in World Class Technologies
Expand Internationally
USA's goal is to become the world's largest and most profitable interactive
commerce company
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Slide 7: Electronic Retailing
(screen shots from HSN)
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Slide 8: EBITA- Electronic Retailing
$ in millions
2001: $101 million
Q1 01: $24
Q2 01: $24
Q3 01: $13
Q4 01: $41
2002: $151 million
Q1 02: $27
Q2 02: $30
Q3 02: $39
Q4 02: $55
2003B: $200 million
Q1 03B: $38
Q2 03B: $46
Q3 03B: $46
Q4 03B: $70
Source: USA 2003 budget released on February 6, 2003 and other SEC
Prepared 2/26/03 - Read important disclaimer(s)
Slide 9: Gross Profit- HSN U.S. (graph)
2001 average: 34.0%
Q1 01: 33.5%
Q2 01: 34.5%
Q3 01: 34.3%
Q4 01: 33.9%
2002 average: 37.1%
Q1 02: 35.5%
Q2 02: 38.4%
Q3 02: 38.1%
Q4 02: 36.7%
Source: USA SEC filings.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 10: Product Mix- HSN U.S.
2001 2002 Gross Profit
Home & Licensing 38% 31% 20-30%
Home Fashions 4% 7% 30-40%
Jewelry 25% 25% 40-50%
Health / Beauty 19% 23% 40-50%
Apparel / Accessories 14% 14% 30-40%
Source: USA SEC filings and HSN estimates.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 11: EBITA- HSN International (graph)
$ in millions
2001: ($26) million loss
Q1 01: ($2)
Q2 01: ($4)
Q3 01: ($12)
Q4 01: ($8)
2002: ($12) million loss
Q1 02: ($6)
Q2 02: ($6)
Q3 02: ($1)
Q4 02: $1
2003B: $8 million
Q1 03B: $2
Q2 03B: $1
Q3 03B: $0
Q4 03B: $5
Source: USA 2003 budget released on February 6, 2003 and other SEC filings.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 12: Growth Drivers- Electronic Retailing
o Merchandising / New Brands
o Raquel Welch, Stephanie Seymour, Lauren Hutton, Kathy Levine,
Rita Wilson/Cathy Waterman, Burt Wolf, Michael Chiarello, Wei East
o HSN.com
o International
o Off-Air
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Slide 13: Information & Services
(graphic from website)
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Slide 14: EBITA- Information & Services (graph)
$ in millions
2001: ($10) million loss
Q1 01: ($5)
Q2 01: $7
Q3 01: ($12)
Q4 01: $0
2002: $75 million
Q1 02: $7
Q2 02: $27
Q3 02: $18
Q4 02: $23
2003B: $186 million
Q1 03B: $24
Q2 03B: $41
Q3 03B: $22
Q4 03B: $99
Source: USA 2003 budget released on 2/6/03.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 15: Online Migration- Ticketmaster (graph)
Today: 41%
Source: USA SEC filings.
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Slide 16: Subscribers- Match.com
in thousands
2000
Q1 190
Q2 217
Q3 253
Q4 382
2001
Q1 528
Q2 604
Q3 653
Q4 725
Source: USA SEC filings.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 17: World's Leading Merchant Discount Marketer
o 8 million customers
o 65,000 merchants
o 250,000 locations
o 160 markets
o $10 B generated for merchants
Transaction pending. Source: EPI
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Slide 18: Size of the Opportunity
Couponing: $180 Billion
80% of US Households Use Coupons
8% Use EPI
Today
o Distribution: 50,000 schools / community groups
o Direct relationship with only 12% of members
o $10B total annual merchant sales
o Avg. member redeems 25+ offers/year
o Avg. merchant receives 2-3K/year
Electronic Discount Program Will:
o Add web distribution via USA and portals
o Increase registrations, renewals, subscriptions
o Enable EPI to capture % of transaction
o~$300 million opportunity
Transaction pending. Pie chart depicts US households. Source: NCH NuWorld
Marketing
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Slide 19: Growth Drivers-Information & Services
o Continued online penetration
o New technologies
o Ticketmaster: ticketAlerts, AccountManager, GroupManager,
teamExchange, LoyaltyManager, MailManager, ticketExchange, dynamic
pricing
o Match: Instant messenger, video, voice, mobile, personality test,
MatchLive
o Local services: client self-enrollment, online discounts, bundling
offers and discounts, credit cards
o Integration of local services
o Digitized offers
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Slide 20: Travel Services
(graphic from website)
Prepared 2/26/03 - Read important disclaimer(s)
Slide 21: EBITA - Travel Services
$ in millions.
2001: $129 million
Q1 01: $18
Q2 01: $35
Q3 01: $35
Q4 01: $41
2002: $281 million
Q1 02: $57
Q2 02: $70
Q3 02: $83
Q4 02: $71
2003B: $448 million
Q1 03B: $83
Q2 03B: $108
Q3 03B: $135
Q4 03B: $122
Source: USA 2003 budget released on February 6, 2003 and other SEC filings.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 22: Online Travel Gross Bookings- U.S. (graph)
$ in millions
(logos) Expedia & Hotels.com
Travelocity
Orbitz
Source: Company reports, Expedia estimates. ROOM figure is gross sales as ROOM
does not report gross bookings.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 23: Revenue- Hotels.com
$ in millions
2001: $536 million
Q1 01: $105
Q2 01: $138
Q3 01: $151
Q4 01: $142
2002: $945 million
Q1 02: $166
Q2 02: $230
Q3 02: $277
Q4 02: $273
2003B: $1.25 billion
Q1 03B: $245
Q2 03B: $305
Q3 03B: $355
Q4 03B: $345
Hotels.com direct
Q2 02: 10%
Q3 02: 20%
Q4 02: 30%
Source: USA 2003 budget released on February 6, 2003 and other SEC filings.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 24: Online Migration- Hotel Rooms
Room nights
05E: 20%
Source: PhocusWright research
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Slide 25: #1 in Online Hotel Rooms (graph)
USA (Expedia & Hotels.com) 36%
Marriott 18%
Hilton 8%
Travelocity 6%
Priceline 5%
Hotwire 3%
Sources:Smith Travel Research, Travelclick and Thomas Weisel Partners LLC
estimates.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 26: International Travel Gross Bookings (graph)
$ in millions. Excludes TV Travel Group.
2001: $236 million
Q1 01: $47
Q2 01: $59
Q3 01: $66
Q4 01: $63
2002: $601 million
Q1 02: $105
Q2 02: $130
Q3 02: $191
Q4 02: $175
International % of Total Travel Gross Bookings
Q1 01: 6.3%
Q2 01: 6.5%
Q3 01: 8.1%
Q4 01: 7.8%
Q1 02: 8.8%
Q2 02: 8.9%
Q3 02: 11.9%
Q4 02: 11.5%
Sources: USA estimates.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 27: Growth Drivers- Travel Services
o Continued online penetration
o New technologies
o Expedia: corporate travel, Newtrade backend
o Hotels.com: packaging, greater automation
o Interval: improve online engine
o TVTS: private label package engine
o International
o Brand spending
Prepared 2/26/03 - Read important disclaimer(s)
Slide 28: 2003 Budget Highlights
$ in millions. Pro forma adjusted
2002 2003B Growth
Revenue $4,657 $6,008 29%
Gross Profit 1,834 2,617 43%
Operating Expenses (a) 1,684 2,268 35%
Operating Income 150 348 132%
EBITA 448 751 68%
Adjusted Net Income 236 414 76%
(a) Not including one-time items of $26.3 million and $121.9 million in 2001 and
2002, respectively.
Source: USA 2003 budget released on 2/6/03.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 29: Strong Balance Sheet
$ in millions, as of December 31, 2002. Pro forma for recent bond issuance.
Cash at USA: $2,866
+ Attributable Cash at Subs: $580
+ Securities in Vue: $2,203
- - Net Debt & Preferred: ($1,892)
= Net Attributable Cash and Securities: $3,757
As adjusted as of 12/31/02. Pro forma for Ticketmaster merger, which closed on
1/17/03. Not pro forma for pending EPI and uDate transactions.
Includes attributable cash from USA's public subsidiaries, based on the Q4
weighted average of USA's fully diluted treasury method ownership in each of its
public subsidiaries, which was 66% for Hotels.com and 55% for Expedia. Excludes
cash due to clients at Ticketmaster.
Prepared 2/26/03 - Read important disclaimer(s)
Slide 30: Leading in Interactive Commerce $ in millions except per share
amounts.
2003E 2003E 2003 E Growth
Revenue Free Cash Flow Adjusted EP/AEPS 02-03 PEG
------- -------------- -------- ------- ----- ---
USA $6,008 $811 $0.75 30x 67% 0.5x
Amazon 4,427 375 $0.31 69x 82% 0.8x
eBay 1,880 448 $1.31 59x 51% 1.2x
Yahoo 1,180 298 $0.47 42x 28% 1.5x
USA data per USA 2003 budget released on 2/6/03. S&P 500 per Morgan Stanley U.S.
Investment Strategy dated 2/21/03. Amazon and eBay per Morgan Stanley research
dated 1/03. Yahoo per Thomas Weisel research dated 2/13/03 and company guidance.
Adjusted EPS for Yahoo represents After-Tax Cash Flow.
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Slide 31: Perspective
o Leading brands
o Strong organic growth
o Diversity of businesses
o Proven track record
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Slide 32: Stock Appreciation (USA)
12/96 - Today: 25% CAGR
USA Interactive
DJIA
NASDAQ
TIER 1 MEDIA
Source: MSN Moneycentral. Tier 1 Media includes AOL Time Warner, News Corp,
Viacom, Disney, Vivendi Universal and Gaylord.
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Slide 33
(logo): USA Interactive
Engaging worldwide in the business of interactivity via the Internet, the
television and the telephone.
Slide 34
(logo): USA Interactive