Historians think prehistoric people made beer well before they made bread.

1
History of Beer

• Historians think pre-historic people made beer
  well before they made bread.
• Babylonian clay tablets from 4300 BC include
  detailed recipes for beer.
• Beer was brewed in Babylonian, Assyrian,
  Egyptian, Hebrew, Chinese and Inca cultures.
• 1200 AD Beer making commercialized in England,
  Germany and Austria.
• 1420 German brewers develop the lager method of
  brewing
• 1490s Columbus discovered Indians making beer
  from corn and black-birch sap
• 1516 Bavarian brewers guilds push the
  Reinheitsgeobot Purity Laws, outlawing the use of
  anything but water, barley and hops in beer
  making.

Source www.beermachine.com
2
How Beer is made

• Milling
• Mashing
• Boiling
• Cooling
• Fermenting
• Filtering
• Conditioning
• Pasteurizing
• Packaging
• Main Ingredients
• Malt
• Hops
• Yeast
• Water

3
Aging and Alcohol Consumption

• Aging and alcohol consumption are inversely
  related.
• A person drinks most in their 20s than in 30s or
  later.
• As people age, they tend to drink more wine and
  spirits.

4
Threat of New Entrants

• Threats of new entrants
• Barriers to entry
• Capital Intensive
• Distribution networks and agreements
• Regulations and Taxes
• Microbrewers are subsidized in Canada
• Economies of scale in marketing, production and
  distribution.

5
Rivalry

• Price competition
• Increasing in Canada, particularly Eastern Canada
• Increasing competition from imported beers
  (however, national brewers own part of these
  breweries).
• 2,200 wholesalers.
• 560,000 retail establishments.
• Growing popularity of micro-breweries and other
  craft-beers.
• Alternative expansion to super-premium beers and
  other segments with lower demand elasticity.

6
Threat of Substitutes

• Substitutes (Growing)
• Growth in
• Wine increasing in popularity
• Spirits and Premixed drinks.
• Alternative malt beverage.
• Alternative non-alcoholic drinks (from juices to
  mineral water).
• However, beer remains the most consumed alcoholic
  beverage in the world.

7
Beer losing ground to Wine Spirits
8
Buyers Bargaining Power

• Varies between market segments and demographics,
  but in general
• Low switching costs
• Price competition
• Increasing health conscience.
• Craft-beers and Microbrewers which are perceived
  as having higher quality, these characteristics
  may not always hold.

9
Supplier Bargaining Power

• Low
• Beer uses only a few ingredients plentiful
  sources.
• Supplies come from competitive industries which
  are more fragmented than the beer industry
• Farmers.
• Labor (the case of unionized labor).
• The more consolidated supplier is that one
  supplying bottles/cans.

10
Global Industry
11
US Industry
12
US Industry
13
China
14
Europe
Western Europe The Western European beer market
is one of the most profitable in the world. In
2004, the beer market declined slightly as a
result of the relatively poor summer, weaker
European economies and unfavorable demographics.
The combination of these elements caused a
general decline in the on-trade. In overall
volume terms, the off-trade grew but was
dominated by increasing competition on price at a
retail level as supermarkets fought to win and
retain customers.
15
Europe
Central and Eastern Europe Central and Eastern
Europe is one of the worlds largest beer markets
by region. Many markets have below-average
per-capita consumption and countries are
preparing to join the European Union. These
elements are forecast to deliver an acceleration
in growth of purchasing power, beer consumption
and to expand the market for premium beer.
16
Europe the World
1997
2003
17
Price Mix Canadian Market
18
Western Canada

• Q2 2004 Growth up due to strike at Labatt's
  Molson.
• Q2 2005
• Poor spring and summer weather.

19
Eastern Canada
Q3 2003 Production failure at Guelph plant Q3
2004 Buck a beer pricing begins in Ontario and
Quebec. Q2 2005 Poor weather conditions.
20
(No Transcript)
21
Business Description

• Established in 1864
• Currently control by 5th generation of Busch
  Family
• August A. Busch III Chairman
• August A. Busch IV Group Executive
• Principle business Production/Distribution
  of Beer
• Packaging
• Entertainment
• 50.2 Domestic Market Share

22
Business Description
2001
2004
23
Domestic Beer Products
Busch Light/Ice Natural Light/Ice
Value Priced
4
8
Budweiser/Light/Dry/Ice/Ice Light/Select Michelob
Golden Draft/Light
Premium Priced
Michelob/Light Michelob Amber Bock/Honey
Lager/Marzen/ULTRA Kirin Light/Ichiban Tequiza Zie
genBock Amber/Light Bacardi Silver/03/Raz/Limon/Bl
ack Cherry/Green Apple BE Anheuser World
Select Bare Knuckle Stout Redhook Products Widmer
22
Above Premium
3
King Cobra Hurricane Malt Liquor Hurricane Ice
Malt Liquor
3
Non-Alcoholic
ODouls/Amber Busch NA
24
International Beer Products
Anheuser Busch
ABEL
U.K.
Ireland
Italy
Spain
Stag Brewery Budweiser/Ice Michelob/ULTRA
Guiness Ireland Budweiser
Heinekan Italia Budweiser
Sociedad Anonima Damm Budweiser
Imported Anheuser World
Imported Anheuser World
Imported ODouls
Imported Anheuser World
25
International Beer Products
Anheuser Busch
Canada
Japan
Korea
Mexico
Labatt Brewing Budweiser/Light Busch/Light
Kirin Brewery Co Budweiser
Oriental Brewing Budweiser
Imported Groupo Modelo Budweiser/Light ODouls
Imported ODouls
Argentina (Chile/Uruguay)
Compania Cervecerias Unidas 10.8 Budweiser
26
International Beer Products
Anheuser Busch
China
Wuhan International Brewing 97
Harbin Brewery Group 694 M, 2004
Tsingtao Current 9.9 In 5 Years27 182
Million
27
Packaging
Precision Printing and Packaging, Inc
Anheuser-Busch Recycling Corporation
Metal Container Corporation

• Manufactures
• pressure sensitive, metalized and paper labels at
  its plant in Clarksville,
• Tennessee

• Buys and sells used aluminum beverage containers
• Recycles aluminum containers at its plant in
  Hayward, California

• Manufactures beverage cans at eight plants and
  beverage can lids at three plants for sale to
  ABI and U.S. soft drink customers

Eagle Packaging, Inc.
Longhorn Glass Manufacturing, L.P.,

• Manufactures crown and closure liner materials
  for ABI at its plant in Bridgeton, Missouri

• Owns and operates a glass manufacturing
• plant in Jacinto City, Texas, which manufactures
  glass bottles for the
• Company's nearby Houston brewery

28
Family Entertainment
29
Growth Domestic Beer
2001 12.9 Billion
2004 14.9 Billion
30
Growth International Beer
Barrels (Millions)
31
Growth Packaging
32
Growth Family Entertainment

• Third Largest Amusement Park Operator in US
• Approximately 20 Million Visitors Annually
• Growth Due to Higher Admission Prices In Park
  Spending
• Adversely Effected by Florida Hurricanes in Q3
  Q4, 2004
• Adventure Island, FLA
• Sea World, FLA

33
Q3 YOY

• Domestic Volume down 2.1
• Mgmt Sights
• 1. Deferred price increase
• 2. Hurricane Katrina

• International Volume up 70.
• Up 3.4 excluding Harbin
• due to increased volume in
• U.K., Canada Mexico, and
• higher Budweiser sales in China

34
Profitability
35
Management
Short Term
Long Term
36
Income Statement
37
Income Statement Key Figures
38
Balance Sheet
39
Balance Sheet
40
Cash Flow Statement
41
Stock Price
42
Valuation
Dividend Discount Model
43
Valuation II
44
Heineken N.V.
45
Origins

• The Heineken family entered the beer business in
  1864, when Gerard Adriaan Heineken bought a
  brewery in Amsterdam.
• Over the past 140 years, under the leadership of
  four generations of the Heineken family and
  pursuing a policy of measured expansion and
  consistent brand development, Heineken has grown
  into one of the worlds leading brewing groups.

46
Profile

• Heineken is on of the worlds leading brewers in
  terms of sales volume and profitability it has
  presence worldwide through a global network of
  distributors
• In volume terms it is the largest brewer and
  beverage distributor in Europe where they realize
  more than half of their sales
• The Heineken brand, available in almost every
  country on the planet, is the worlds most
  valuable international premium beer brand.

47
Goal and Strategy

• Heinekens goal is to grow the business in a
  sustainable and consistent manner, while
  constantly improving profitability. Its strategy
  has four elements
• Strive to reach a leading position in attractive
  markets
• Focus on capturing an ever-growing share of the
  premium and specialty beer market segment
• Work to improve efficiency and cut costs in
  operations
• Grow through selective acquisitions, so long as
  they create shareholder value

• Heineken can therefore benefit from other
  companys infrastructure and combine its
  sales and distribution of the Heineken
  brand with other strong local brands

48
Company ownership structure
49
Company ownership structure

• 50.005 of the shares of Heineken N.V., is held
  by Heineken Holding N.V., this company has no
  operational activities and is concerned with
  safeguarding the long-term continuity,
  independence and stability of Heineken N.V.s
  activities.
• Heineken N.V. is responsible for all the
  operational activities and the companys goal and
  business strategy
• LArche Holding S.A., a Swiss Company, is fully
  owned by the Heineken family. This company holds
  50.005 of the Heineken Holding N.V. shares
• The net asset value and dividend policy of
  Heineken N.V. and Heineken Holding N.V. are
  identical. However, Heineken Holding N.V. trades
  at a discount

50
Executive Board

• Tony Ruys Chairman since 2002. Joined Heineken
  in 1993 after a career with Unilever NV in the
  Netherlands and abroad
• Marc Bolland Director since 2001. Joined
  Heineken in 1986 and has held various positions
  in the Netherlands and abroad
• Jean-Francois van Boxmeer Director since 2001.
  Joined Heineken in 1984 and has held various
  positions in the Netherlands and abroad
• René Hooft Graafland Director since 2002. Joined
  Heineken in 1981 and has held various positions
  in the Netherlands and abroad
• Karl Büche Director since 2004. Joined Heineken
  in 2004. Since 1972 he has held various positions
  in Brau Union AG

51
Executive Board Remuneration

• As of 2005, the remuneration package of the
  Executive Board will include a base salary, an
  annual bonus and a long-term incentive
• The fixed salary will account for 45 of the
  total remuneration package
• The variable remuneration is divided equally
  between short-term and long-term
• This will ensure a balanced focus, on both
  short-term and long-term performance

52
Executive Board Remuneration

• Base salary
• The base salary for the Chairman will be set 30
  above the base salary for the members of the
  Executive Board
• Short-term incentive
• The emphasis of the short-term incentive will be
  on annual operational performance.
• Organic net profit growth will be the measure
  to asses the operational performance
• Organic net profit growth is identified as growth
  in net profit excluding exchange rate effects,
  changes in consolidation, amortization of
  goodwill, exceptional items and changes in
  accounting policies

53
Executive Board Remuneration

• Long-term incentive
• This long-term incentive will be a performance
  based share plan
• Each year a number of shares will be
  conditionally awarded. The value of shares equals
  325,000 for the members of the Executive Board
  and 422,500 for the Chairman
• The performance condition will be total
  shareholder return, measured over a three year
  period relative to a performance peer group. If,
  over a three year period, Heineken performs
  better than the median of the peer group the
  Executive Board will be rewarded with shares
• The shares will be subject to a holding
  restriction of two years

54
Executive Board Remuneration

• Below median, no shares will be awarded
• At 6th position, 25 of the target amount will
  vest
• At 5th position, 50 of the target amount will
  vest
• At 4th position, 75 of the target amount will
  vest
• At 3rd position, a 100 will be granted
• If Heineken is ranked first, the maximum number
  of shares will vest. This is 1.5 times the target
  amount of shares. Heineken is currently ranked
  eleventh.
• The performance peer group includes
  Anheuser-Bush, Carlsberg, InBev, SABMiller,
  Scotish Newcastle, Henkel, LOreal, LVMH/PPR,
  Nestlé, Numico, Unilever

55
Products and Brands

• Heineken owns and manages a portfolio of beer
  brands. Its main international brands are
  Heineken and Amstel
• The Heineken brand is positioned as a premium
  beer brand, except for its home market in the
  Netherlands it is also the leading brand in
  Europe and Amstel is the third largest
• In Europe, Amstel is positioned in the mid-priced
  segment, the largest segment of the market, and
  is available in more than 90 countries around the
  world
• Heineken also owns and manages a strong portfolio
  of more than 120 top-selling brands that includes
  Cruzcampo, Zywiec, Birra Moretti, Murphys and
  Star
• The company has a limited presence in the
  low-priced segment of the market

56
Products and Brands

• Heineken and Amstel brands

57
Products and Brands

• Heineken and Amstel brands
• Total Heineken brand volume rose to 11.4 millions
  of hectoliters in the first half of 2005. The
  Heineken brands performed strongly in Central and
  Eastern Europe, Africa, Asia and Latin America
• Amstel sales volume were stable at 5.3 millions
  of hectoliters in the first half of 2005, with
  substantial growth in Africa, offset by lower
  volumes in some European markets
• In 2004, total sales volume was made up as
  follows the Heineken brand 18.7, Amstel 9.1
  and other beer brands 72.2

58
Sales by Region

• Heineken divide the world beer market in five
  regions as follows

• Western Europe
• As of June 2005, performance in Western Europe
  was mixed, with some Southern European markets
  showing difficult economic environments and low
  consumer spending

59
Sales by Region

• Despite lower beers sales volume, better prices
  were achieved in all major Western European
  countries, in both the on-trade and the
  off-trade.
• Cost savings and efficiency improvements
  positively contributed to EBIT growth. However,
  EBIT was negatively affected by 34 million of
  exceptional charges relating to production
  improvements in France
• Heineken brand premium volume in the first half
  grew 0.8 despite lower sales volume in the
  declining French market. Growth in other markets
  remained healthy, particularly in Spain
• In the Netherlands, sales volume was low, only
  partially offset by improved price and sales mix
  and lower costs

60
Sales by Region

• In Spain, turnover and EBIT increased due to
  higher sales volume, price and sales mix. The
  construction of the new brewery in Seville (233
  million project) with a capacity of 4.5 millions
  hectoliters, will be finished at the end of 2006
  and production reaching full capacity in 2008
• In Italy and the UK, volumes were up
• Central and Eastern Europe
• In the first half of 2005, net turnover and group
  volumes were up, partially as a result of the
  first-time consolidation of the new breweries in
  Russia and Germany
• Bulgaria, Austria and Slovakia showed lower
  volumes due to higher excise duties

61
Sales by Region

• In the first half of 2005, net turnover and group
  volumes were up, partially as a result of the
  first-time consolidation of the new breweries in
  Russia and Germany
• Bulgaria, Austria and Slovakia showed lower
  volumes due to higher excise duties
• Integration activities at Braun Union, which
  started in 2004, have been completed. A total of
  11 breweries and malteries have been closed so
  far
• In Poland, the restructuring of Group Zywiec
  distribution system and the closure of breweries
  in 2004 had a good impact in turnover and EBIT
• Russia increased sales volume as a result of the
  first-time consolidation of acquisitions (4 new
  companies)

62
Sales by Region

• Russia increased sales volume as a result of the
  first-time consolidation of acquisitions (4 new
  companies)
• In Austria, due to a real estate divestment, EBIT
  was low
• In Greece, turnover rose slightly despite lower
  volumes, thanks to cost control and improved
  pricing
• The Americas
• In the first half of 2005, the performance of the
  Heineken group was mixed, with the Latin American
  operations (Chile and Argentina), driving the
  organic growth in the region and compensating the
  slower first half in the USA
• The joint-venture with Femsa S.A. for the USA
  started in January 2005. Femsas Mexican brands
  grew in volume

63
Sales by Region

• Africa and the Middle East
• As of June 2005, the performance varied across
  the region, with strong results in Nigeria and
  South Africa and weak results in the Middle East.
• Sales volume of Heineken and Amstel grew by 14
  and 20 respectively. The Fayrouz brand in Egypt
  also grew
• Asia Pacific
• In 2004 in China, Heineken and Asia Pacific
  Breweries merged and created Heineken Asia
  Pacific Breweries China (HAPBC). In 2005 HAPBC
  acquired a 40-stake in DaFuHao Breweries in
  Jiangsu, which recently acquired a brewery in
  Wuijang

64
Sales by Region
65
Financial Statements
66
Financial Statements
67
Financial Statements
68
Financial Analysis

• Statement of Income
• As of June 2005, net turnover of the company rose
  by 5.8 to 5.1 billion (4.9 in June 2004). At
  the end of 2004 net turnover rose by 8.1 to
  10.0 billion. Both increases were due to
  price/mix improvements and net volume growth

69
Financial Analysis

• In 2004, the operating profit rose 2 to 1.25
  billion despite the negative impact of exchange
  rate movements of 158 million
• New acquisitions added 93 million to operating
  profit before amortization of goodwill of 50
  million
• Income from non-consolidated participating
  interests declined by 241 million to 140
  million negative. This decrease was due to the
  190 million impairment charge on Heinekens 20
  participating interest in Cervejerias Kaiser and
  must be viewed against the exceptional net gain
  of 71 million in 2003 on the sale of the 15
  interest in Argentinean brewing group Quilmes

70
Financial Analysis

• Net interest charges rose to 180 million,
  reflecting the higher interest charges in
  connection with loans raised to finance
  acquisitions
• Net profit was down 32.7 to 537 million and
  earnings per share declined to 1.10 (1.63 in
  2003)

71
Financial Analysis

• Balance Sheet and Cash flow statement
• As of June 2005, cash flow from operations
  remained stable at 566 million compared with
  574 million in the first half of 2004. Lower tax
  payments were offset by a seasonal increase in
  net working capital. The sale of real estate
  assets in Austria also added 238 million net of
  tax to the total cash inflow.
• In 2004, cash flow from operations decreased to
  1,520 million from 1,637 million in 2003. Net
  investments in tangible assets added to 637
  million. A total of 1,049 million was invested
  in new acquisitions and expanding existing
  interests.

72
Financial Analysis

• This refers to the second phase of the Brau Union
  acquisition in Austria (39.7), Shikan Brewery
  (95.1), Volga Brewery (100) and Sobol Brewery
  (100), the increased stake in Dinal (48) and
  other acquisitions in Europe

73
Financial Analysis

• The leverage ratio displayed by the company is
  the result of its continuous process of
  acquisitions in the industry. This process is
  also reflected in the increment of its long-term
  debt throughout time
• The profitability of the company has been
  decreasing over time due to the tight competition
  in the American market and the downside in many
  European economies during the last years

74
Stock Analysis

• Heinekens stock is traded on the U.S. OTC under
  the symbol HINKY.PK. As of February 17, 2006
  HINKY traded at US35.20 or 29.63 (1
  US1.18789)The following chart shows HINKYs 5
  year stock performance

75
Stock Analysis

• Gordons Growth Model
• This model can be used to valuate a company in a
  mature industry. Heinekens dividend growth is
  likely to be steady, therefore
• Value of stock DPS1/(k-g)
• and DPS1 DPS0(1g)
• k (DPS1/P0)g
• Where DPS1 expected dividend paid out in one
  year
• k required rate of return on investment
  g the assumed constant growth rate for dividend
• P0 current stock price

76
Stock Analysis

• In this case g 0.05 (the average of the last 5
  years dividend growth on the stock)
• DPS1 0.40(10.05) k (DPS1/P0) g
• DPS1 0.42 k (0.42/29.63) 0.05
• k 0.0641748
• Because Heinekens k looks small compared to the
  one showed by its peer Anheuser-Busch (k 9.44),
  we calculate the ß for Heineken, (ß0.276627
  0.28) which reflects the lower cost of capital
  that Heineken shows in Europe, where it displays
  more than 80 of its revenue

77
Recommendation

• The actual price of the stock is 29.63 or
  US35.20 which is in line with the value obtained
• Taking into account that the expected growth in
  the beer industry will be minimum or flat, and
  given the tight situation in Europe and the
  continuous process of consolidation in the
  industry, we recommend to HOLD the stock
• Over the last years Heinekens growth has been
  determined principally by its continuous process
  of acquisitions and resulting synergies,
  (basically a zero-sum game) rather than in its
  presence in other markets

78
SLEEMAN BREWERIES LTD

• TSXALE

79
The Company

• Established in 1985.
• Produces, sells, markets, and distributes Sleeman
  line of Premium beers, as well as several
  regional craft-brewed beers.
• It is the leading brewer and distributor of
  premium beer in Canada and the third largest
  brewing company nationwide (after Molson and
  Labatt's).

80
History

• 1834 - John H. Sleeman establishes himself as a
  brewer and malter.
• 1851 - JHS purchases property in Guelph for the
  Silver Creek Brewery.
• 1898 - Recipe for Sleeman Cream Ale is brewed.
• 1900 - Sleeman Brewing and Malting Company is
  incorporated.
• 1933 - George A. Sleeman is caught smuggling beer
  into Detroit. Faced with two choices
• Pay the beer taxes and get out of the brewing
  business.
• Lose the brewery.
• He chose to pay the taxes, and sold off the
  brewery. Sleeman brewery closes.

81
History more recent

• 1984 - John Sleeman receives the leather bound
  Sleeman recipe book and an original heritage
  bottle from his Aunt. He decides to revive the
  family business.
• 1985 - The Sleeman Brewing and Malting Company is
  incorporated on October 29th.
• 1991 - Sleeman doubles brewing capacity to 200000
  HL (60 MM bottles) and has 1 of the Ontario beer
  market.
• 1992 - Sleeman Cream Ale is exported to Detroit,
  Michigan.
• 1997 - Sleeman Honey Brown Lager is launched -
  most successful product launch in company's
  history.
• 2002 - Sleeman launches Cans in unique "barrel"
  cans.
• 2004 - Sleeman acquires Unibroue

82
Sleeman Brands

• Sleeman
• Upper Canada
• Okanagan Spring
• Seigneuriale
• Shaftebury
• Maritime Beer
• Unibroue

83
Distribution Agreements

• Imports and distributes well-known international
  brands.
• 2006 Agreement to produce and distribute
  Sapporo in Canada.
• National distribution network.

84
Sleeman Premium Beers
85
Value Brands

• Mainly marketed in the Eastern segments
  (Ontario).
• Not a major focus, but company will Stratify
  brands, with Pabst at the bottom and Old
  Milwaukee as sub-premium.

86
Business strategy

• Manage costs and increase efficiency Cost
  Control decreasing cost per Hectoliter.
• Grow premium brands. The company recognizes that
  it won't win by engaging in a price war, and is
  thus placing itself mainly as a premium beer
  marketer for its brands, particularly in the
  Western segments.
• Continue to compete with Buck-a-beers with its
  own value line Pabst, mainly in Eastern segment.
• Expand US business, using Sleeman Cream Ale as
  its lead brand.
• Pursue other strategic acquisitions
  particularly other premium craft-brewers.

87
SWOT Analysis

• TSXALE

88
Strengths

• Strong brand name. Has clearly distinguished
  itself from the two big brands, Labatts
  Molson.
• Unique packaging on both Bottles Cans. sets
  apart from competitors.
• National distribution network.
• Clear acquisition strategy Organic growth and to
  buy other premium microbreweries.

89
Weaknesses

• Debt-ridden company.
• No cash.
• Not large enough yet to realize real economies of
  scale or to compete on price.
• Susceptible to the seasons 2004 had poor summer
  weather across the country.
• Susceptible to other factors NHL Lockout.

90
Opportunities

• U.S. markets Sleeman Unibroue brands are the
  most recognizable Canadian premium beers.
• Unibroue has distribution to 34 states.
• Oct 2005 Ontario raised floor prices from
  24.00 to 26.40 (incl. deposit)
• New deal with Quebec retailers.

91
Threats

• Buck-a-beer competitors (Lakeport, Brick
  Brewing) and its market segment has been very
  successful, and is here to stay.
• Molson, Labatts have slashed prices to compete.
• Other Tax-subsidized Microbreweries
• Increasing popularity of wine and spirits for
  younger demographic.

92
Financial Analysis

• TSXALE

93
Income Sheet
SOURCE COREREFERENCE
94
Income Statement Analysis

• Slowdown in Revenue generation, Zero growth since
  2003 (but no decline).
• Net income estimate for 2005 will be lowest since
  2001.
• Widening gap between Revenues, EBITDA and Net
  Income Inefficiency and lack of cost control.

95
Sleeman - Efficiency
96
Balance Sheet
97
Balance Sheet

• Increasing Debt and L/T debt.
• No cash until last Qtr Q3 2005.
• Increasing Inventories reflect no growth in
  sales
• Increasing Receivables
• Increasing Intangibles that make up an increasing
  portion of Total Assets.
• General trend of increasing Current Liabilities.

98
(No Transcript)
99
Cash Flow Analysis
100
Valuation

• No dividends given in companys history
• Multiples Valuation Used
• Conservative EPS estimated 2006 at 0.70 (vs. Q3
  2005 report of 0.60-0.65)

101
TSXALE
102
Recommendation

• HOLD