"Points has taken a number of specific actions regarding ongoing growth, profitability and sustainable margin improvement. These include an aggressive investment in a new technology platform, a realignment of the cost structure leading to a 20% decrease in full time equivalent headcount, and a fundamental re-imagining of the consumer business. Matched with a restructured Delta relationship and the launch of the AirFrance/KLM relationship, the Company's clear focus is on launching and growing higher margin business and sustainable profitability," said Chairman, Stephen K. Bannon.

"Points reported a solid second quarter driving 23% growth in total revenue and a 36% increase in principal revenue year-over-year, despite ongoing challenges in the economic environment," said CEO Rob MacLean. "We saw business trends improve this quarter as the total number of points and miles transacted increased sequentially. Our new partnership with AirFrance-KLM, Europe's largest carrier, went live and we added Continental Airlines and AirTran to the growing list of participating programs on our peer-to-peer trading platform. We expect both to contribute to our results moving forward. Looking ahead, our focused investment strategy will drive efficiencies, enabling us to reduce costs, both in terms of personnel and technology infrastructure. We are very focused on improving our overall profit margins moving forward and driving leverage through our model resulting in long-term corporate profitability."

"Today, we agreed to a restructured relationship with Delta Air Lines for the remainder of our current contract as it continues to consolidate aspects of its loyalty program post a recently completed merger. As a result, we are revising our full year revenue guidance to the range of $70 million to $80 million. This recast relationship will see Points continue to generate revenue from this partner by providing a variety of services. Combined with a solid base of transactions from existing and newly signed partners and the terms of the restructured relationship with this partner, and despite a continued challenging environment, assuming current foreign exchange rates, we are able to reaffirm our guidance of positive EBITDA for 2009, our third consecutive year," added MacLean.

Second Quarter 2009 Financial Results

Total revenue was $21.3 million for the second quarter of 2009. Revenue grew 23% over the $17.3 million reported in the second quarter of 2008, and up from $21.1 million in the first quarter of 2009. Principal revenue grew sharply to $19.6 million, up 36% over $14.4 million in the same period last year, and up from $19.4 million in the first quarter of 2009. Commission revenue was $1.7 million, down from $2.7 million reported in the same period of last year and down from $1.8 million in the first quarter of 2009. Interest revenue was $9,600, a decrease from $219,000 reported in the same period last year and $35,400 in the first quarter of 2009.

Points reported a net loss for the second quarter of 2009 of $471,000, or ($0.00) per share. This compares to a net income of $43,500, or $0.00 per share in the same period in the previous year, and a net loss of $1.1 million or ($0.01) per share, in the first quarter of 2009.

During the second quarter of 2009, Points reported an EBITDA loss of $566,000, compared to positive EBITDA of $474,000 in the same period of 2008 and an EBITDA loss of $580,000 in the first quarter of 2009.

As of June 30, 2009, Points' total cash, comprised of cash and cash equivalents together with security deposits and amounts with payment processors, was $29.4 million, down from $32.9 million at the end of the first quarter of 2009. The Company carries no debt.

   Second Quarter 2009 Business Metrics    Total All Channels:   -------------------    -   Total points/miles transacted during the second quarter was       2.8 billion, bringing the total cumulative points/miles transacted to       51.4 billion, a 29% increase over the second quarter of 2008   -   The total number of transactions decreased 11% versus the same       quarter last year to approximately 302,000    Ecommerce Services:   -------------------    -   Total points/miles transacted on products distributed through       Points' partner channels decreased 12% from the second quarter of       2008 to 2.5 billion bringing the cumulative total to 46.1 billion    Points.com Channel:   -------------------   -   Cumulative points/miles transacted reached approximately 5.2 billion       during the second quarter of 2009 on Points.com, a 32% increase       versus 2008   -   Cumulative registered users on Points.com increased 15% year-over-       year to 2.3 million                                                    Q2/09               Q2/09                                                   vs.                 vs.                        Q2/09           Q1/09     Q1/09      Q2/08    Q2/08    TOTAL ALL    CHANNELS*      Points/Miles      Transacted    2,830,429,997   2,727,601,671   4%   3,125,608,038   -9%     # of      Points/Miles      Transactions        302,419         320,390  -6%         340,294  -11%     Cumulative      Points/Miles      Transacted   51,366,498,684  48,536,068,687   6%  39,699,151,161   29%    PRIVATE BRANDED    CHANNELS      Points/Miles      Transacted    2,542,915,477   2,456,850,552   4%   2,895,769,039  -12%     # of      Points/Miles      Transactions        279,311         298,101  -6%         322,912  -14%     Cumulative      Points/Miles      Transacted   46,147,425,848  43,604,510,371   6%  35,751,042,610   29%    POINTS.COM    CHANNELS      Points/Miles      Transacted      287,514,520     270,751,119   6%     229,838,999   25%     # of      Points/Miles      Transactions         23,108          22,289   4%          17,382   33%     Cumulative      Points/Miles      Transacted    5,219,072,836   4,931,558,316   6%   3,948,108,552   32%     Cumulative      Registered      Users             2,252,404       2,189,814   3%       1,962,883   15%    Note:   * Points/Miles transacted were restated in Q1 2008 to normalize       activity from a loyalty program whose loyalty program currency is       valued differently than other programs. This resulted in a decrease       in overall metrics for those products.    Restructured Relationship with Delta   

On August 12th, 2009, the Company agreed to a restructured relationship with Delta Air Lines in conjunction with the planned Delta SkyMiles(R) and Northwest Worldperks(R) unification into a single frequent flier program. Commencing on or about October 1, 2009, Delta has elected to leverage existing internal capabilities to provide the retail mileage sale and transfer programs currently being operated by Points.

In the first quarter of 2010, Points will re-launch its retail sale and transfer of SkyMiles services through a new distribution channel of sites not controlled by Delta and including the Company's consumer portal http://www.points.com/. This will offer Delta members increased access to these services and is a growing strategic focus of the Company. Points will continue to operate a number of other services for Delta, including the corporate mileage wholesaling platform, auction service, pooling service, magazine and newspaper subscription service, as well as Points' AirIncentives(TM) and offerings on the Points.com portal.

"Points has been a great partner for both SkyMiles and Northwest for many years," says Jeff Robertson, Vice President, Delta SkyMiles. "We anticipate the continuation of this significant partnership into to the future, and plan to work with Points on a number of fronts as we drive innovation with the goal of making SkyMiles the most successful frequent flyer program in the world."

"We continue to enjoy a long and mutually beneficial working relationship with both Delta and Northwest. Delta remains a large and important partner to Points. While taking advantage of its unique in-house assets as it consolidates its frequent flyer programs during its massive post merger integration efforts Delta, has also renewed its commitment to leverage Points' capabilities and industry expertise to ensure continued success in growing its program. While this change will materially impact our revenues, the new terms provide for a series of payments over the fourth quarter that will allow Points to maintain our expected 2009 earnings associated with this relationship," added MacLean. "Furthermore, with a full pipeline, increasing traction of newer partnerships, and our recast potential with Delta, we expect to be able to mitigate the negative earnings impact of this change and improve our margins through 2010."

In 2008 and for 2009 to date on an annualized basis, the programs affected by this restructuring represented approximately 60% of the Company's revenue. The Company anticipates no effect on the overall working capital as the partner currently accounts for approximately 30% of cash and cash equivalents as well as approximately 30% of amounts payable to loyalty partners.

   Business Outlook    Ecommerce Services:   

A major focus of the Company's investment strategy for 2009 is to substantially enhance its technology platform to more efficiently drive and increase synergies between Points' private-branded Ecommerce solutions and the Points.com consumer portal. The current platform, which has evolved since the Company's inception, has served Points exceptionally well, now handling more than $250 million in annual transactions. Based on the successful expansion of the Company's business, it has now reached the scale to start to deploy a new platform over the second half of 2009. To this end, Points has recently launched "Project Epoch", focused on delivering an upgraded platform, the first phase of which is expected to launch during the fourth quarter of 2009, which will materially enhance the Company's capabilities, including:

   -   Expanded scale to support a new level of transactions;   -   Increased customer integration speed thereby accelerating the pace of       new partner launches;   -   The deployment of new innovations including mobile and social       networking applications for the loyalty industry;   -   Significantly enhanced functionality;   -   Meaningful efficiency improvements that are designed to decrease the       Company's overall operating expenses and go-forward technology costs.   

Progress already achieved by its focused investments has enabled Points to begin to restructure its operating expenses in anticipation of next year's expected efficiencies. Accordingly, the Company expects to reduce full-time equivalents (contractors and staff) by 20% over the next two quarters. As a result of these activities, Points expects to take appropriate restructuring charges in its third quarter results.