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Jasons Travel Media Financial Forecast for Y/E March 2013

Continual Disclosure
(NZAX code: JTM)
25 March, 2013

As advised earlier this month Jasons is now posting an updated financial forecast for the year ending 31 March along with commentary on current trading conditions and expectations for the start of the new financial year. At the beginning of the financial year the company remained optimistic that the travel sector would weather the impacts of global economic change and experience improvement over the period. At the half year the company indicated that it expected to deliver better year-end results than the 2012 year, however, that is proving not to be the case. In the half-year report the company did go on to caution that the tourism market remained depressed and that the motel sector in particular was the worst performing of all accommodation tourism sectors. As the company prepares to deliver its end-of-year financials, it is now obvious that the result will be a net loss before tax. Accordingly, the company has breached its interest cover and Debt / EBITDA covenants with the ANZ Bank. The company has asked the bank to waive the breach and is working through this process with them. A further update will be released when the matter is resolved. Although, the New Zealand operation has continued to be a challenge and New Zealand sales were slightly behind budget, Australian sales have fallen well behind budget. Following a positive result from its Australian operation for the y/e 2012, that region has again dropped back to a loss for y/e 2013. As a result, the company has decided to significantly scale back employee numbers and areas of operation in Australia for 2013/14. The company will also account for non-cash adjustments and increased accruals for bad debts both in Australia and New Zealand. Jasons has tackled its balance sheet with rigour and paid down relatively large amounts of debt during a time of global economic uncertainty while at the same time implementing a number of changes designed to better serve its customers and meet client expectations, says Jasons Chairman John Sandford.

Weve strengthened and streamlined our internal processes, applied a much more strategic approach to our business, and introduced a new digital product range to complement our existing digital range and very successful suite of print products. No other travel media business in New Zealand can offer the depth and range of market access options provided by Jasons. Recent research into consumer and market expectations and trends underpins a solid sales and marketing strategy that our New Zealand team are currently implementing nationwide. Mr. Sandford said Jasons sell significant amounts of forward business and, although the team are only 6 weeks into the 2013/14 sales programme, early indications are that the company should see better outcomes for the 13/14 year. We remain cautiously optimistic, but the period ahead will be a challenging one. Were focused on re-building the companys position as a profitable, successful company based on our position as a trusted source of travel information he said. Ends

John Sandford Chairman Jasons Travel Media ltd. E-mail: Phone: 021 926 942