TLCs Stockholder Meeting

1
TLCs Stockholder Meeting
Total Luxury Carrier Lux-Connect

• Gordon Haave, CEO
• Jim Rogers, VP Marketing
• Jill Van Noy, VP Finance
• Kristy Walker, CFO
• November 11, 2003

2
Forward-Looking Statement

• Statements in this presentation regarding the
  companys or managements intentions, beliefs or
  expectations, or that otherwise speak of future
  events, are forward-looking statements within
  the meaning of the Private Securities Litigation
  Reform Act of 1995. Future developments and
  results discussed in these statements may be
  affected by numerous factors and risks, including
  those identified in the Risk Factors section of
  the companys Annual Report or Form 10-K and
  other SEC filings. Actual results and
  developments may differ materially from those
  expressed or implied in this presentation or in
  these materials.

3
Meeting Agenda

• TLCs Mission
• Goals
• Initial Strategy
• Challenges Faced
• Revised Strategy
• Financial Overview
• Future Plans

4
TLCs Mission and Vision

• Mission Statement
• To offer convenient domestic and international
  air travel while providing impeccable service and
  customer care
  
• New Management Teams Vision
• To realign the companys goals and objectives
  with the aforementioned mission statement
  

5
Objectives and Goals

• Be the premier luxury-class carrier in every
  market served
  
• Load factor of 55 or greater on all flights
• Employee turnover of less than 2
• Triple the number of airports / markets TLC
  services
  
• Constantly increase the value of TLCs stock
  price while maintaining dividend payments
  
• Establish TLC as a premier employer for
  professionals
  
• Give back to the communities in which TLC
  operates
  

6
Initial Strategy to Meet Goals

• Establish Ourselves as Premier Airline in the
  Marketplace
  
• Aircraft purchase 8 Embraer ERJ135s, more
  later
  
• Financing - 9M in stock sold, 30M long-term
  loan
  
• Cargo transport business
• Promotions - 100K each in promotions and
  advertising
  
• Focus on Luxury Service
• Cabin service free drinks, hors doeuvres and
  meals
  
• Maintenance highest level
• Employees 5 increase above the prevailing
  wage, training program
  
• Total Quality Management (TQM) System
• 1,000 donated quarterly to the Ronald McDonald
  House Charities
  

7
Challenges for TLCs Management Team

• Limits on promotions and advertising budgets

• Limits on TQM Budget
• Competition with Team 6
• Incident decisions

8
Challenges for TLCs Management Team
Declining ROE ROS
9
Challenges for TLCs Management Team
Quality too low for fare structure
Fare
Competitor delivering same quality at lower fare
Perceived Quality
10
Revised Strategy

• Cut aircraft and routes to maximize impact of
  expenditures on advertising, promotions and TQM

• Re-focus routes to 600 mile markets to maximize
  value of aircraft

11
Revised Strategy
Route Structure
Routes / Day
Route Length
12
Revised Strategy - Results
13
Revised Strategy - Results
14
Revised Strategy - Results
Closest to linehighest profits, EPS
Fare
Perceived Quality
15
Incidents

• Entered cargo business
• Contracted with national website
• Added auto rentals to serve customers
• Declined ancillary services (ambulance, charters,
  Congressman) focused on core service
  
• Accepted dual designate increased load factor
• Maintained highest ethical standards refused to
  steal employees from competitors, valued existing
  relationships won Employer of the Region Award
  for our integrity

16
Financial Overview
17
Financial Overview
1,989.764
173,021
55,555
18
Financial Overview
Stock Price
70.77
Rapid Growth
Gimmicks!
Implementation
19
Future Plans

• Pay off debt
• Increase investment in cargo business
• Increase dividends

20
Future Plans
LT Debt