Frontenac Institutional Investor Conference Marc P. Tellier

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Frontenac InstitutionalInvestor ConferenceMarc
P. Tellier Christian PaupeYellow Pages
GroupSeptember 30, 2004
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About Us

• Yellow Pages Group
• Largest directories publisher in Canada
• Yellow Pages Income Fund
• Leading Canadian income trust

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Leading Directories Publisher

• Largest directories business in Canada
• 236 Yellow Pages directories
• 18 million copies
• 241,000 advertisers

Reaching 70 of Canadians
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71 of Canadians refer to directories each month
55 of users make a purchase as a result
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71 of Canadians refer to directories each month
55 of users make a purchase as a result
43 of purchasers are new customers for the
advertiser
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Total Canadian Advertising 11.6B
Directory Advertising 10 of total advertising
spending
Source Television Bureau of Canada
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Compelling Advertising Medium

• Stable and less cyclical
• Ubiquitous reach
• Permanent source of reference
• Highly engaged users ready to buy

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Media of Choice for Small and Medium Businesses

• 1 million businesses in Canada
• 99 of businesses are SMEs
• 79 of SMEs use directory advertising
• 39 of YPGs customers use it as their principal
  or only form of advertising

SMEs 89 of directory advertising revenues
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YPG Value Equation

• Content
• Product
• Distribution
• Promotion

Retention Usage
Advertiser ROI
Advertiser AD / Program
YPG
Users
Advertisers
ROI 26 to 1
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Exclusive Owner of Well-known Brands
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Innovative Ad Campaign - Billboards
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Street Advertising
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Street Advertising
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Leading Online Directories

• 3.8 million unique visitors
• Reaching 21 of Canadian Internet users
• Improved search engine
• YellowPages.ca and Canada411.ca
• New product offerings

Source comScore Media Metrix Canada, July 2004
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Online Distribution Agreements
Seeking unparalleled distribution
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Online Growth

• Increased online revenues
• 3 of revenues in 20041 vs. 2 in 2003
• Strong growth
• 2003 29 YoY
• 1H 2004 23.6 vs. 1H 2003

Strong contributor to organic growth
1 As of June 2004
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Financial Highlights
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Leading Income Trust

• Income Trust Market 100 billion
• Yellow Pages Income Fund
• Market Cap of 4.1 billion
• Average volume/day of 1.1 million units
• Total return to investors since IPO of approx. 30

Unique investment opportunity
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Revenue Growth
Adjusted Revenues
Millions
3.3
4.4
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EBITDA Growth
Adjusted EBITDA
Millions
4.3
9.1
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Maintaining our Momentum
Revenues
millions
EBITDA
4.5
millions
5.4
EBITDA margin of 58.1
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Strong Cash Flow Generation
TTM as of June 30, 2004
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Cash Available for Distributions
millions
20.8
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Distributions Per Unit
4.6
6.7
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Capital Market Activity Since IPO

• 5B of financing activities
• Diversify funding sources
• Extend term of indebtedness
• Improve financial condition

Investment grade ratings
Stability ratings SP (SR-2) / DBRS (STA-1)
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Diversified Funding Sources
millions
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Reinforced Capital Structure

• Net Debt / EBITDA

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Reinforced Capital Structure
Cash Interest Expense ( millions)
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Organic Growth Strategies

• Increased comprehensiveness of our directories
• New user features (print and online)
• Improved distribution strategies
• Advertising and promotion campaigns
• Increased productivity and improved processes

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External Growth Strategies

• Extend product line
• Reinforce strategic SME relationships
• Expand geographic coverage

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Investment Criteria Business Acquisitions

• Preference for acquisitions within directory
  market
• Accretive to unitholders
• Strong capital structure
• Maintain investment grade and stability ratings

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Keeping the Momentum

• Attractive fundamentals
• High revenue visibility
• Continuing EBITDA growth
• Exceptional cash flow generation
• Strong and diversified capital structure

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