Investor Presentaiton
QANTAS LOYALTY
Overview of cash flow and accounting treatment
Points Earned
Points Flow
by Spending
Gross Billings
Cash Flow
Life of a Point
~2 years
Points Redeemed for Award; or
Points Expire (Breakage)¹
Redemption
Cost
Cash
Interest
Breakage
Income
Statement
Marketing
Services
Revenue
Marketing
Revenue
Redemption
Revenue
Redemption
Cost
Interest
Revenue
Redemption
Margin
Fair Value
Deferred
Balance Sheet
Opening
Revenue
Received in
Advance
Closing
Revenue
Received in
Advance
n/a
Opening
Revenue
Received in
Advance
Redemption
Revenue
Closing
Revenue
Received in
Advance
1 Marketing Revenue
Sources of
Value
2
Working Capital benefit (interest income)
3
③ Redemption Margin
Note: above diagram highlights unique QFF accounting items only. Diagram excludes other revenue (e.g. membership revenue) and operating costs below gross margin. 1. Breakage is recognised at the time of
points earn / issuance based on an estimated breakage rate. There is no further recognition of breakage at the time of points expiry. However, the actual rate of breakage is used to inform the estimated 147
breakage rate for initial recognition.View entire presentation