AP NEWS

Points International Reports Third Quarter 2018 Results

November 13, 2018

Gross Profit up 11% to $12.6 Million

Net Income Increased 144% to $1.5 Million

Adjusted EBITDA up 29% to $4.1 Million

TORONTO, Nov. 13, 2018 (GLOBE NEWSWIRE) -- Points International Ltd. (TSX: PTS) (Nasdaq: PCOM) (Points or the Company), the global leader in powering loyalty commerce, is reporting financial results for the third quarter ended September 30, 2018. Points adopted International Financial Reporting Standard 15 - Revenue from Contracts with Customers (IFRS 15) - effective January 1, 2018 and applied these new accounting policies retrospectively. Accordingly, 2017 comparative amounts have been restated.

Unless otherwise noted, all comparisons are on a year-over-year basis and all amounts are in USD. The complete third quarter Condensed Consolidated Interim Financial Statements and Management Discussion & Analysis, including segmented results, are available at www.sedar.com and www.sec.gov.

Third Quarter 2018 Financial Highlights (vs. Year-Ago Quarter)

-- Total revenue increased 3% to $94.4 million compared to $91.6 million. -- Gross profit1 increased 11% to $12.6 million compared to $11.3 million. -- Net income increased 144% to $1.5 million or $0.10 per share, compared to $0.6 million or $0.04 per share. -- Adjusted EBITDA2 increased 29% to $4.1 million compared to $3.2 million.

Recent Operational Highlights

-- Renewed its multi-year agreement with the Etihad Airways’ Guest program, extending the term for three years across both Loyalty Currency Retailing and Points Travel Services -- Launched previously announced mileage earning capabilities to the Etihad Points Travel Service to complement existing Travel redemption services -- Broadened its service offering with the Emirates Skywards program in the third quarter, launching the previously announced Extend product and expanded the reach of its Buy product, enabling Skywards members the ability to use their miles balance plus cash to top up more seamlessly for flight awards -- Added Frontier Airlines to the list of participating Loyalty Programs and also agreed to an enhanced marketing relationship with Groupon in order to more aggressively roll out its loyalty initiative -- The Board of Directors approved the renewal of Points Normal Course Issuer Bid and Automatic Share Purchase Plan (ASPP) for the period August 14, 2018 to August 13, 2019

_______________________________________1 Gross profit is defined as total revenues less the direct cost of principal revenue. Gross profit is considered by management to be an integral measure of financial performance and represents the amount of revenues retained by the Company after incurring direct costs. However, gross profit is not a recognized measure of profitability under IFRS.2 Adjusted EBITDA (Earnings before income tax expense, depreciation and amortization, foreign exchange and share-based compensation) is considered by management to be a useful supplemental measure when assessing financial performance. Management believes that adjusted EBITDA is an important indicator of the Company’s ability to generate liquidity through operating cash flow to fund future capital expenditures and working capital needs. However, adjusted EBITDA is not a measure of financial performance under IFRS and should not be considered a substitute for Net Income, which we believe to be the most directly comparable IFRS measure.

Management Commentary

“Q3 was highlighted by another solid quarter of double-digit growth in our two most important financial metrics – gross profit and adjusted EBITDA,” said Rob MacLean, CEO of Points International. “In fact, this was our fifth consecutive quarter of double-digit growth for both metrics, driven by the continued momentum in our core Loyalty Currency Retailing segment, or LCR, which benefited from new client wins over the last year and ramping existing client programs.

“In Points Travel, we worked to get one of our larger partners back on plan after experiencing a temporary freeze between May and August as they dealt with internal GDPR compliance matters. This freeze affected gross profit and contribution for the quarter, however we expect to have this client back at full ramp as we enter 2019. Despite this temporary setback, we are pleased with the business development success we have seen so far in 2018, launching new Points Travel services with Singapore Airlines, Amtrak Guest Rewards, Air Europa, and most recently, expanding our services with the Etihad Guest program. While this focus on new business added some initial costs in 2018, we feel well positioned for growth in Points Travel in 2019 and beyond.

“We remain on track to deliver another record year of gross profit and adjusted EBITDA. Led by the continued ramp of new client wins over the last year, as well as growth from existing partnerships across all three operating segments, we are pleased with the direction of our diversification strategy. Continued success in our enhanced, data-led marketing efforts are an important contributor to our success. We plan to carry this momentum and continue executing across all three of our business segments as we exit 2018.”

Third Quarter 2018 Financial Results

Total revenue in the third quarter of 2018 increased slightly to $94.4 million compared to $91.6 million in the year-ago quarter. Principal revenue was $88.7 million compared to $87.8 million, and other partner revenue increased 48% to $5.7 million compared to $3.8 million.

Gross profit in the third quarter increased 11% to $12.6 million compared to $11.3 million in the year-ago quarter. The increase was primarily driven by continued organic growth from existing partners and the benefit of ramping up new partner launches over the last year.

Total adjusted operating expenses3 in the third quarter of 2018 were $8.7 million compared to $8.2 million in the year-ago quarter.

Net income increased 144% to $1.5 million or $0.10 per share, compared to $0.6 million or $0.04 per share in the year-ago quarter.

Adjusted EBITDA in the third quarter increased 29% to $4.1 million compared to $3.2 million in the year-ago quarter. This was primarily driven by the aforementioned increase in gross profit. As a percentage of gross profit, adjusted EBITDA improved 460 basis points to 32.8% compared to 28.2% from the prior year, reflecting improved operating leverage.

At September 30, 2018, total funds available, comprised of cash and cash equivalents together with restricted cash and funds receivable from payment processors, was $63.7 million compared to $79.2 million at December 31, 2017. The Company remains debt free.

During the third quarter, Points repurchased for cancellation approximately 39,000 shares of common stock at an average price of $14.28 per share through its Automatic Share Purchase Plan in conjunction with its Normal Course Issuer Bid (NCIB).

___________________________________3 Adjusted operating expenses consist of employment expenses excluding share-based compensation, marketing and communications, technology services and other operating expenses. Adjusted operating expense is not a measure of financial performance under IFRS and should not be considered a substitute for total expenses, which we believe to be the most directly comparable IFRS measure.

2018 Outlook

Points continues to expect gross profit to increase between 10% and 20% compared to 2017. The Company also continues to expect adjusted EBITDA to increase between 30% and 40% compared to $13.2 million in 2017.

Segmented Disclosure

Beginning in the second quarter of 2018, Points added additional transparency to its business segment performance disclosure. Contribution by segment is provided as the key performance measure in the financial statements. Contribution is defined as gross profit for the relevant operating segment less direct adjusted operating expenses4. This addition was made as the Company determined that contribution is the most appropriate measure when assessing each segment’s operating performance and more accurately reflects the value of shared resources in driving the Company’s performance. Adjusted EBITDA by segment continues to be disclosed in the Company’s Management Discussion & Analysis.

__________________________________4 Direct adjusted operating expenses is a non-GAAP measure and is defined as expenses which are directly attributable to each operating segment.

Conference Call

Points will hold a conference call today at 4:30 p.m. Eastern time to discuss its third quarter 2018 results, followed by a question-and-answer session.

Date: Tuesday, November 13, 2018Time: 4:30 p.m. Eastern time (1:30 p.m. Pacific time)Toll-free dial-in number: 1-877-407-0784International dial-in number: 1-201-689-8560Conference ID: 13684329

Please call the conference telephone number 5-10 minutes prior to the start time, and an operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Liolios at 1-949-574-3860.

A replay of the conference call will be available after 7:30 p.m. Eastern time on the same day through November 27, 2018.

Toll-free replay number: 1-844-512-2921International replay number: 1-412-317-6671Replay ID: 13684329

About Points International Ltd.

Points (TSX: PTS) (Nasdaq: PCOM) provides loyalty e-commerce and technology solutions to the world’s top brands to power innovative services that drive increased loyalty program revenue and member engagement. The Company has a growing network of nearly 60 global loyalty programs integrated into its unique Loyalty Commerce Platform. Points offers three core private or co-branded services: its Loyalty Currency Retailing service, which retails loyalty points and miles directly to consumers; its Platform Partners service, which offers developers transactional access to dozens of loyalty programs and hundreds of millions of members via a package of APIs; and its Points Travel service, which helps loyalty programs increase revenue from hotel bookings, while enabling members to more effectively earn and redeem loyalty rewards. Points is headquartered in Toronto with offices in San Francisco and London.

For more information, please visit company.points.com, follow Points on Twitter (@ PointsLoyalty ) or read the Points blog. For Points’ financial information, visit investor.points.com.

Caution Regarding Forward-Looking Statements

This press release contains or incorporates forward-looking statements within the meaning of United States securities legislation, and forward-looking information within the meaning of Canadian securities legislation (collectively, “forward-looking statements”). These forward-looking statements include, among other things, opportunities for new products and partners and incremental revenue, including the expected launch of announced products and partner relationships, potential for growth in revenue and gross margin, and our guidance for 2018 with respect to gross profit and adjusted EBITDA expectations. These statements are not historical facts but instead represent only Points’ expectations, estimates and projections regarding future events.

Although Points believes the expectations reflected in such forward-looking statements are reasonable, such statements are not guarantees of future performance and are subject to important risks and uncertainties that are difficult to predict. Certain material assumptions or estimates are applied in making forward-looking statements, and actual results may differ materially from those expressed or implied in such statements. Undue reliance should not be placed on such statements. In particular, the financial outlooks herein assume Points will be able to maintain its existing contractual relationships and products, that such products continue to perform in a manner consistent with Points’ past experience, that Points will be able to generate new business from our pipeline at expected margins, our in-market and newly launched products and services will perform in a manner consistent with the Company’s past experience and we will be able to contain costs. Our ability to convert our pipeline of prospective partners and product launches is subject to significant risk and there can be no assurance that we will launch new partners or new products with existing partners as expected or planned nor can there be any assurance that Points will be successful in maintaining its existing contractual relationships or maintaining existing products with existing partners. Other important risk factors that could cause actual results to differ materially include the risk factors discussed in Points’ annual information form, Form-40-F, annual and interim management’s discussion and analysis, and annual and interim financial statements and the notes thereto. These documents are available at www.sedar.com and www.sec.gov.

The forward-looking statements contained in this press release are made as at the date of this release and, accordingly, are subject to change after such date. Except as required by law, Points does not undertake any obligation to update or revise any forward-looking statements made or incorporated in this press release, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

The Company’s financial statements are prepared in accordance with International Financial Reporting Standards (“IFRS”). Management uses certain non-GAAP measures, which are defined in the appropriate sections of this press release, to better assess the Company’s underlying performance. These measures are reviewed regularly by management and the Company’s Board of Directors in assessing the Company’s performance and in making decisions about ongoing operations. We believe that these measures are also used by investors as an indicator of the Company’s operating performance. Readers are cautioned that these terms are not recognized GAAP measures and do not have a standardized GAAP meaning under IFRS and should not be construed as alternatives to IFRS terms, such as net income.

Investor Relations Contact

Sean Mansouri or Cody SlachLiolios1-949-574-3860 PCOM@liolios.com

Points International Ltd. Key Financial Measures and Schedule of Non-GAAP Reconciliations Gross Profit Information5 Expressed in thousands of United States dollars For the three months ended September September 30, 30, 2018 20176 Total Revenue $ 94,358 $ 91,589 Direct cost of principal revenue 81,776 80,268 - ------ - ------ Gross Profit $ 12,582 $ 11,321 - ------ - ------ Gross Margin 13% 12% - ------ - ------

____________________________5 Gross Profit is defined as total revenues less the direct cost of principal revenue. Gross profit is considered by management to be an integral measure of financial performance and represents the amount of revenues retained by the Company after incurring direct costs. However, gross profit is not a recognized measure of profitability under IFRS.6 Results as at September 30, 2017 have been restated under IFRS 15

Reconciliation of Gross Profit to Contribution7 Expressed in thousands of United States dollars For the three months ended SeptemberSeptember 30, 30, 2018 2017 Gross profit $ 12,582 $ 11,321 Less: Direct adjusted operating expenses8 5,269 5,061 - ------ - ------ Contribution $ 7,313 $ 6,260 - ------ - ------

_____________________________7 Contribution is defined as Gross profit less direct adjusted operating expenses. Contribution is considered by Management to be a useful supplemental measure when assessing financial performance. Management believes that Contribution is an important indicator of the Company’s segment profitability. However, Contribution is not a recognized measure of profitability under IFRS.8 Direct adjusted operating expenses is defined as expenses which are directly attributable to each operating segment. Direct adjusted operating expenses is not a measure of financial performance under IFRS.

Contribution by Line of Business Expressed in thousands of United States dollars For the three months ended September 30, September 30, 2018 2017 Loyalty Currency Retailing Revenue 91,950 89,326 Gross profit 10,378 9,221 Direct adjusted operating expenses 3,048 2,840 Contribution 7,330 6,381 ----------------------------------------------- ------------- - ------------- - Platform Partners Revenue 1,940 1,824 Gross profit 1,773 1,672 Direct adjusted operating expenses 831 1,100 Contribution 942 572 ----------------------------------------------- ------------- - ------------- - Point Travel Revenue 468 439 Gross profit 431 428 Direct adjusted operating expenses 1,390 1,121 Contribution (959 ) (693 ) ----------------------------------------------- ------------- - ------------- -

Reconciliation of Net Income to Adjusted EBITDA9

Expressed in thousands of United States dollars For the three months ended SeptembeSeptembe r 30, r 30, 2018 2017 Net Income $ 1,476 $ 605 Share-based compensation 1,054 1,321 Income tax expense 693 310 Depreciation and Amortization 858 1,029 Foreign exchange loss (gain) 40 (75 ) - ----- - ----- - Adjusted EBITDA $ 4,121 $ 3,190 - ----- - ----- -

________________________________9 Adjusted EBITDA (Earnings before income tax expense, depreciation and amortization, foreign exchange and share-based compensation) is considered by management to be a useful supplemental measure when assessing financial performance. Management believes that adjusted EBITDA is an important indicator of the Company’s ability to generate liquidity through operating cash flow to fund future capital expenditures and working capital needs. However, adjusted EBITDA is not a measure of financial performance under IFRS and should not be considered a substitute for Net Income, which we believe to be the most directly comparable IFRS measure.

Reconciliation of Total Expenses to Adjusted Operating Expenses10 Expressed in thousands of United States dollars For the three months ended SeptemberSeptember 30, 30, 2018 2017 Total Expenses $ 92,431 $ 90,745 Subtract (add): Direct cost of principal revenue 81,776 80,268 Depreciation and amortization 858 1,029 Foreign exchange loss (gain) 40 (75 ) Stock-based compensation 1,054 1,321 - ------ - ------ - Adjusted Operating Expenses $ 8,703 $ 8,202 - ------ - ------ -

______________________________10 Adjusted operating expenses consists of employment expenses excluding share based compensation, marketing, technology services, and other operating expenses. Adjusted operating expenses is not a measure of financial performance under IFRS and should not be considered a substitute for total expenses, which we believe to be the most directly comparable IFRS measure.

Points International Ltd. Condensed Consolidated Interim Statements of Financial Position Expressed in thousands of United States dollars (Unaudited) September December As at 30, 31, 2018 2017 ASSETS Current assets Cash and cash equivalents $ 55,668 $ 63,514 Restricted cash 500 500 Funds receivable from payment processors 7,483 15,229 Accounts receivable 6,987 7,741 Prepaid expenses and other assets 2,085 2,420 - ------- - ------- Total current assets $ 72,723 $ 89,404 - ------- - ------- Non-current assets Property and equipment 2,211 2,128 Intangible assets 14,068 15,265 Goodwill 7,130 7,130 Deferred tax assets 3,446 2,557 Other assets 2,627 2,661 - ------- - ------- Total non-current assets $ 29,482 $ 29,741 - ------- - ------- Total assets $ 102,205 $ 119,145 - ------- - -------

LIABILITIES Current liabilities Accounts payable and accrued liabilities $ 7,066 $ 7,998 Income taxes payable 914 695 Payable to loyalty program partners 53,362 65,567 Current portion of other liabilities 816 1,400 - ------- - - ------- - Total current liabilities $ 62,158 $ 75,660 - ------- - - ------- - Non-current liabilities Other liabilities 414 538 - ------- - - ------- - Total non-current liabilities $ 414 $ 538 - ------- - - ------- - Total liabilities $ 62,572 $ 76,198 - ------- - - ------- - SHAREHOLDERS’ EQUITY Share capital 54,320 56,394 Contributed surplus 4,366 10,647 Accumulated other comprehensive income (loss) (131 ) 374 Accumulated deficit (18,922 ) (24,468 ) - ------- - - ------- - Total shareholders’ equity $ 39,633 $ 42,947 - ------- - - ------- - Total liabilities and shareholders’ equity $ 102,205 $ 119,145 - ------- - - ------- -

Points International Ltd. Condensed Consolidated Interim Statements of Comprehensive Income Expressed in thousands of United States dollars, except per share amounts (Unaudited) For the three months For the nine months ended ended September September September September 30, 2018 30, 30, 2018 30, 201711 201711 REVENUE Principal $ 88,689 $ 87,765 $ 263,394 $ 249,724 Other partner revenue 5,669 3,824 17,933 10,787 Total Revenue $ 94,358 $ 91,589 $ 281,327 $ 260,511 EXPENSES Direct cost of principal revenue 81,776 80,268 241,528 226,970 Employment costs 6,934 6,660 20,698 18,731 Marketing and communications 308 388 1,096 1,391 Technology services 545 489 1,592 1,390 Depreciation and amortization 858 1,029 2,624 3,017 Foreign exchange (gain) loss 40 (75 ) (33 ) (183 ) Operating expenses 1,970 1,986 6,483 6,068 - ------ - - ------ - - ------- - - ------- - Total Expenses $ 92,431 $ 90,745 $ 273,988 $ 257,384 - ------ - - ------ - - ------- - - ------- - Finance income 242 71 446 158 INCOME BEFORE INCOME TAXES $ 2,169 $ 915 $ 7,785 $ 3,285 Income tax expense 693 310 2,239 1,096 - ------ - - ------ - - ------- - - ------- - NET INCOME $ 1,476 $ 605 $ 5,546 $ 2,189 OTHER COMPREHENSIVE INCOME (LOSS) Items that will subsequently be reclassified to profit or loss: Unrealized gain (loss) on foreign exchange derivative 205 573 (545 ) 1,101 designated as cash flow hedges Income tax effect (54 ) (151 ) 144 (292 ) Reclassification to net income of loss (gain) on foreign 180 (192 ) (141 ) (132 ) exchange derivatives designated as cash flow hedges Income tax effect (48 ) 51 37 35 - ------ - - ------ - - ------- - - ------- - Other comprehensive income (loss) for the period, net of income $ 283 $ 281 $ (505 ) $ 712 tax - ------ - - ------ - - ------- - - ------- - TOTAL COMPREHENSIVE INCOME $ 1,759 $ 886 $ 5,041 $ 2,901 - ------ - - ------ - - ------- - - ------- - EARNINGS PER SHARE Basic earnings per share $ 0.10 $ 0.04 $ 0.39 $ 0.15 Diluted earnings per share $ 0.10 $ 0.04 $ 0.39 $ 0.15 - ------ - - ------ - - ------- - - ------- -

_____________________________11 Results for the three and nine months ended September 30, 2017 have been restated under IFRS 15.

Points International Ltd. Condensed Consolidated Interim Statements of Changes in Shareholders’ Equity Attributable to equity holders of the Company Accumul ated Total Expressed in thousands of United States Contribut other Accumulate sharehold dollars except number of shares ed compreh d ers’ (Unaudited) Surplus ensive deficit equity income Share Capital (loss) Number of Amount Shares Balance at December 31, 2017 14,561,450 $ 56,394 $ 10,647 $ 374 $ (24,468 ) $ 42,947 ---------- - - ------ - - ------ - - ---- - - ------- - - ------ - Net income - - - - 5,546 5,546 Other comprehensive loss, net of tax - - - (505 ) - (505 ) ---------- - - ------ - - ------ - - ---- - - ------- - - ------ - Total comprehensive income - - - (505 ) 5,546 5,041 Effect of share option compensation plan - - 40 - - 40 Effect of RSU compensation plan - - 3,157 - - 3,157 Share issuances – options exercised 118,288 1,348 (997 ) - - 351 Settlement of RSUs - 1,316 (3,905 ) - - (2,589 ) Share capital held in trust - (2,956 ) - - - (2,956 ) Shares repurchased (457,556 ) (1,782 ) (4,576 ) - - (6,358 ) ---------- - - ------ - - ------ - - ---- - - ------- - - ------ - Balance at September 30, 2018 14,222,182 $ 54,320 $ 4,366 $ (131 ) $ (18,922 ) $ 39,633 ---------- - - ------ - - ------ - - ---- - - ------- - - ------ -

Balance at December 31, 2016 14,878,674 $ 58,412 $ 9,881 $ (127 ) $ (27,848 ) $ 40,318 ---------- - - ------ - - ------ - - ---- - - ------- - - ------ - Net income - - - - 2,189 2,189 Other comprehensive income, net of tax - - - 712 - 712 ---------- - - ------ - - ------ - - ---- - - ------- - - ------ - Total comprehensive income - - - 712 2,189 2,901 Effect of share option compensation plan - - 223 - - 223 Effect of RSU compensation plan - - 2,834 - - 2,834 Share issuances – options exercised 16,988 395 (335 ) - - 60 Settlement of RSUs - 1,255 (1,255 ) - - - Share capital held in trust - (1,053 ) - - - (1,053 ) Shares repurchased (162,347 ) (644 ) (865 ) - - (1,509 ) ---------- - - ------ - - ------ - - ---- - - ------- - - ------ - Balance at September 30, 2017 14,733,315 $ 58,365 $ 10,483 $ 585 $ (25,659 ) $ 43,774 ---------- - - ------ - - ------ - - ---- - - ------- - - ------ -

Points International Ltd. Condensed Consolidated Interim Statements of Cash Flows Expressed in thousands of United States dollars (Unaudited) For the three months For the nine months ended ended September September September September 30, 2018 30, 2017 30, 2018 30, 2017 Cash flows from operating activities Net income for the period $ 1,476 $ 605 $ 5,546 $ 2,189 Adjustments for: Depreciation of property and equipment 247 238 715 649 Amortization of intangible assets 611 791 1,909 2,368 Unrealized foreign exchange loss (gain) (127 ) 716 (558 ) 1,425 Equity-settled share-based payment transactions 1,054 1,321 3,197 3,057 Deferred income tax recovery (337 ) (46 ) (708 ) (444 ) Unrealized net loss (gain) on derivative contracts designated 385 381 (686 ) 969 as cash flow hedges Changes in non-cash balances related to operations (17,426 ) 3,975 (4,757 ) (5,808 ) - ------- - - ------ - - ------- - - ------ - Net cash provided by (used in) operating activities $ (14,117 ) $ 7,981 $ 4,658 $ 4,405 - ------- - - ------ - - ------- - - ------ - Cash flows from investing activities Acquisition of property and equipment (60 ) (267 ) (798 ) (1,025 ) Additions to intangible assets (189 ) (358 ) (712 ) (1,029 ) Settlement of short-term investment, net of interest - 10,033 - 10,033 Net cash provided by (used in) investing activities $ (249 ) $ 9,408 $ (1,510 ) $ 7,979 - ------- - - ------ - - ------- - - ------ - Cash flows from financing activities Proceeds from exercise of share options - 60 351 60 Shares repurchased (557 ) (1,439 ) (6,358 ) (1,509 ) Purchase of share capital held in trust - (857 ) (2,956 ) (1,053 ) Taxes paid on net settlement of RSUs (53 ) - (2,589 ) - Net cash used in financing activities $ (610 ) $ (2,236 ) $ (11,552 ) $ (2,502 ) - ------- - - ------ - - ------- - - ------ - Effect of exchange rate fluctuations on cash held 127 (716 ) 558 (1,425 ) Net increase (decrease) in cash and cash equivalents $ (14,849 ) $ 14,437 $ (7,846 ) $ 8,457 - ------- - - ------ - - ------- - - ------ - Cash and cash equivalents at beginning of the period $ 70,517 $ 40,512 $ 63,514 $ 46,492 Cash and cash equivalents at end of the period $ 55,668 $ 54,949 $ 55,668 $ 54,949 - ------- - - ------ - - ------- - - ------ - Interest Received $ 212 $ 156 $ 358 $ 204 Taxes Received $ - $ 114 $ 110 $ 114 Taxes Paid $ (542 ) $ (506 ) $ (2,223 ) $ (3,011 )

Amounts received for interest were reflected as operating cash flows in the condensed consolidated interim statements of cash flows.

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