Financial Analysis Presentation Materials

EX-99.C.2 8 dex99c2.htm FINANCIAL ANALYSIS PRESENTATION MATERIALS Financial Analysis Presentation Materials

Exhibit (c)(2)

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STRICTLY CONFIDENTIAL

Project Rover

Presentation to the Board of Directors

July 13, 2006

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Disclaimer

The accompanying material was compiled on a confidential basis for use solely by the Board of Directors of Rover (the “Company”) in evaluating the proposed transaction described therein. This material is not intended to provide the sole basis for evaluating the transaction, does not purport to contain all information that may be required and should not be considered a recommendation with respect to the transaction. This material was prepared for a specific use by specific persons and was not prepared with a view to public disclosure or to conform with any disclosure standards under securities laws or otherwise. Nothing contained in the accompanying material is, or shall be relied upon as, a promise or representation as to the past, the present or the future. UBS Securities LLC (“UBS”) undertakes no obligation to update or revise the accompanying material.

It should be understood that certain financial and market information, estimates, valuations and/or projections contained in the accompanying material were prepared or derived from information supplied by the Company and public sources without the assumption by UBS of responsibility for any independent verification thereof. Accordingly, neither UBS nor any of its officers, directors, employees, affiliates, advisors, agents or representatives warrants the accuracy or completeness of any such information, including, without limitation, the accuracy or achievability of any such valuations, estimates and/or projections. Actual results may vary from such estimates, valuations or projections and such variations may be material. This material must not be copied, reproduced, distributed or passed to others at any time without the prior written consent of UBS.

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Table of Contents

SECTION 1

Transaction Background

SECTION 2

Valuation Analyses

SECTION 3

Other Information

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SECTION 1

Transaction Background

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Transaction Summary

(US$ in millions, except per share information)

At At

Rover Market1 Offer

Share Price $19.45 $29.00

Fully Diluted Shares Outstanding2 57.919 58.297

Fully Diluted Equity Value 1,126.5 1,690.6

Plus: Debt3 169.3 169.3

Less: Cash3 (33.2) (33.2)

Total Enterprise Value $1,262.6 $1,826.7

Implied Valuation Multiples:

Public Filings and Consensus Estimates Statistic TEV Multiples

LTM 4/29/06 Revenue4 $2,037.5 0.62x 0.90x

FY 2006E Revenue5 2,218.0 0.57x 0.82x

FY 2007E Revenue5 2,419.0 0.52x 0.76x

LTM 4/29/06 Adj. EBITDA4,6 213.6 5.9x 8.6x

FY 2006E Adj. EBITDA5,6 221.3 5.7x 8.3x

FY 2007E Adj. EBITDA5,6 239.2 5.3x 7.6x

Management Projections

FY 2006E Revenue7 $2,209.3 0.57x 0.83x

FY 2007E Revenue7 2,410.5 0.52x 0.76x

FY 2006E Adj. EBITDA6,7 226.9 5.6x 8.1x

FY 2007E Adj. EBITDA6,7 255.7 4.9x 7.1x

Offer Price $29.00

Premium to: Statistic Premium

Current Share Price1 $19.45 49.1%

One Week Prior $19.56 48.3%

One Month Prior $18.69 55.2%

30 Days Average Price (Trading) $19.49 48.8%

60 Days Average Price (Trading) $20.22 43.4%

90 Days Average Price (Trading) $20.84 39.1%

12 Month Average Price (Trading) $22.07 31.4%

Notes:

Closing share price as of July 13, 2006

2 Basic shares per 10-Q for the quarter ended April 29, 2006; options data from FY 2005 10-K; calculated per treasury method; restricted stock units data from Company

Per 10-Q for the quarter ended April 29, 2006

Per Company’s public filings (FY 2005 10-K, 10-Q for the quarter ended April 29, 2006)

Based on current I/B/E/S consensus mean estimates derived from FactSet

Adjusted EBITDA excludes non-cash stock based compensation

Per Rover management assumptions and projections as of 6/15/2006; 2006 presented on 52-week basis

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Rover Price / Volume Performance

Stock Price (US$)

7/13/05

9/24/05

12/6/05

2/17/06

5/1/06

7/13/06

Volume (mm)

Source: FactSet

Date Financial Event

A 8/25/2005 Company reports Q2 ‘06 revenue of $482.7mm, a 10% year-over-year increase; net income for the quarter falls $1.3mm

B 9/8/2005 Company reports expected third quarter EPS of $0.25 to $ 0.28

C 11/22/2005 Company reports that Q3 ‘06 earnings are down to $0.23 per share from $0.36 a year earlier; Q4 outlook is below Wall Street expectations

D 1/23/2006 Company appoints Dave Bolen as Chief Merchandising Officer

E 3/16/2006 Company announces $ 100mm share buyback

F 3/30/2006 Lassie submits initial indication of interest letter to the Board of Directors

G 4/17/2006 Spot submits initial indication of interest letter to the Board of Directors

H 5/24/2006 Company reports Q1 ‘07 revenue of $521.0mm, a 8.5% year-over-year increase; net income for the quarter falls $6.2mm

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Indexed Price Performance

Last Three Years

190%

170%

150%

130%

110%

90%

70%

50%

7/14/03

2/18/04

9/24/04

5/1/05

12/6/05

7/13/06

S&P 500 125%

Food Retail

Composite2 124%

Spot 123%

Specialty Retail

Composite1 120%

Rover 83%

Last Twelve Months

130%

120%

110%

100%

90%

80%

70%

60%

50%

7/13/05

9/24/05

12/6/05

2/17/06

5/1/06

7/13/06

Food Retail

Composite2 108%

S&P 500 104%

Specialty Retail

Composite1 92%

Spot 77%

Rover 67%

Source: FactSet

Notes:

1 Specialty Retail Composite includes Advanced Auto Parts (AAP), AutoZone (AZO), Barnes & Noble (BKS), Bed Bath & Beyond (BBBY), Best Buy (BBY), Borders (BGP), Circuit City (CC), Dick’s Sporting Goods (DKS), Home Depot (HD), Jo-Ann Stores (JAS), Lowe’s (LOW), Office Depot (ODP), PETsMART (PETM), Staples (SPLS), Williams-Sonoma (WSM)

2 Food Retail Composite includes Delhaize (DEG), Koninklijke Ahold (AHO), Great Atlantic & Pacific Tea (GAP), Kroger (KR), Pathmark Stores (PTMK), Safeway (SWY), Weis Markets (WMK)

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SECTION 2

Valuation Analyses

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Rover Historical and Projected Financial Summary

Actual FY, Projected FY, CAGR

($mm) 2004A 2005A 2006E1 2007E 2008E 2009E 2010E 2011E ‘06 -’11

Net Sales $1,812.1 $1,996.1 $2,252.8 $2,410.5 $2,626.4 $2,850.3 $3,073.7 $3,302.3 7.9%

Cost of Sales and Occupancy Costs 1,181.4 1,330.1 1,499.3 1,599.4 1,729.6 1,869.6 2,009.7 2,150.5 7.5%

Gross Profit $630.8 $666.0 $753.5 $811.1 $896.7 $980.7 $1,064.0 $1,151.8 8.9%

Selling, General, & Administrative Expense 472.8 524.6 604.8 656.5 715.2 774.7 834.3 897.1 8.2%

EBIT $158.0 $141.5 $148.7 $154.7 $181.6 $206.0 $229.6 $254.8 11.4%

Plus: D&A 63.6 77.8 88.7 101.0 116.3 128.5 140.0 151.6 11.3%

Adjusted EBITDA $221.6 $219.3 $237.4 $255.7 $297.9 $334.5 $369.6 $406.4 11.4%

Growth Rates and Margins

Net Sales (% Growth) 12.5% 10.2% 12.9% 7.0% 9.0% 8.5% 7.8% 7.4%

Mature Store Sales (% Growth) na na na 2.2% 2.0% 2.0% 2.0% 2.0%

Gross Profit (% Margin) 34.8% 33.4% 33.4% 33.6% 34.1% 34.4% 34.6% 34.9%

EBIT (% Margin) 8.7% 7.1% 6.6% 6.4% 6.9% 7.2% 7.5% 7.7%

EBITDA (% Margin) 12.2% 11.0% 10.5% 10.6% 11.3% 11.7% 12.0% 12.3%

Other Data

Capital Expenditures 119.8 123.5 115.5 140.9 137.0 129.2 127.3 130.6

% of Sales 6.6% 6.2% 5.1% 5.8% 5.2% 4.5% 4.1% 4.0%

Net New Stores 62 63 76 75 75 75 75 75

Remodeled Stores 50 53 32 32 32 32 32 32

Source: Actual financials per SEC filings; projected financials and assumptions provided by Rover management Note:

2006E data includes the effect of the 53rd week

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Market Data on Selected Specialty Retail Companies1

Enterprise Value/

Company Name Stock Price (7/13/06) (US$) FD Equity Value (US$mm) Enterprise Value2 (US$mm) LTM Sales (x) CY06E Sales (x) CY07E Sales (x) LTM EBITDA (x) CY06E EBITDA (x) CY07E EBITDA (x) CY06E P/E (x) CY07E P/E (x) CY06E PE to G (x) CY07E PE to G (x) LT Growth (%)

Pet Supplies

PETsMART 23.47 3,362 3,414 0.88 0.82 0.73 7.6 6.9 6.1 17.1 14.6 0.99 0.84 17.3

Office Supplies

Staples 23.07 17,173 16,323 0.99 0.93 0.85 9.7 9.2 8.2 18.5 16.0 1.15 0.99 16.1

Office Depot 35.68 10,454 10,489 0.73 0.71 0.66 10.8 10.0 8.8 19.9 16.3 1.26 1.04 15.8

Consumer Electronics

Best Buy 46.50 22,973 21,245 0.67 0.62 0.56 9.7 8.5 7.4 17.1 14.7 1.02 0.88 16.8

Circuit City 24.89 4,437 3,882 0.32 0.31 0.29 9.1 8.6 7.1 23.6 18.6 1.48 1.16 16.0

Auto Parts

AutoZone 85.25 6,380 8,121 1.38 1.40 1.33 7.0 7.0 6.8 11.1 9.8 0.77 0.68 14.4

Advance Auto Parts 28.85 3,085 3,608 0.82 0.77 0.71 6.7 6.6 5.4 13.0 11.2 0.82 0.70 15.9

Book Retailers

Barnes & Noble 34.05 2,352 2,303 0.45 0.44 0.42 5.2 5.3 5.0 15.0 13.5 1.18 1.06 12.8

Borders 18.28 1,178 1,575 0.39 0.38 0.36 5.5 5.4 5.0 12.9 11.0 1.07 0.92 12.0

Home Furnishings

Bed Bath & Beyond 32.22 9,225 9,137 1.53 1.42 1.28 9.2 8.7 7.6 15.1 13.2 0.93 0.81 16.3

Williams-Sonoma 32.44 3,830 3,611 1.00 0.94 0.84 7.6 7.2 6.3 16.5 14.3 0.96 0.83 17.2

Crafts

Michaels Stores 42.14 5,708 5,266 1.43 1.34 1.25 10.3 10.0 8.7 21.5 18.2 1.20 1.02 17.9

Jo-Ann Stores 12.76 310 474 0.25 0.25 0.24 11.9 7.3 na na na na na 15.0

DIY

Home Depot 34.07 70,525 74,606 0.89 0.81 0.75 6.5 6.0 5.6 11.2 10.0 0.84 0.75 13.3

Lowe’s 27.96 43,515 45,337 1.00 0.94 0.84 7.3 6.9 6.0 13.7 12.0 0.83 0.73 16.5

Sporting Goods

Dick’s Sporting Goods 37.12 1,987 2,185 0.81 0.73 0.65 10.0 9.2 7.9 20.2 16.9 1.06 0.89 19.0

Mean3 0.81 0.76 0.70 8.3 7.5 6.7 16.1 13.7 1.03 0.88 15.6

Median3 0.82 0.77 0.71 7.6 7.2 6.6 15.8 13.9 1.01 0.86 16.0

High 1.53 1.42 1.33 11.9 10.0 8.8 23.6 18.6 1.48 1.16 19.0

Low 0.25 0.25 0.24 5.2 5.3 5.0 11.1 9.8 0.77 0.68 12.0

Rover 19.45 1,127 1,263 0.62 0.57 0.53 5.9 5.7 5.3 14.9 13.1 0.99 0.87 15.0

Rover (management projections) 0.58 0.53 5.6 5.0

Lassie Bid 29.00 1,691 1,827 0.90 0.83 0.76 8.6 8.2 7.7 22.2 19.5 1.48 1.30 15.0

Lassie Bid (management projections) 0.83 0.76 8.1 7.2

Notes:

1 Financial projections per I/B/E/S consensus estimates; all projections (including Rover) calendarized to December year end

2 Enterprise Value equal to fully diluted equity value plus total debt and minority interest minus cash and cash equivalents (all at book value)

Excludes Michaels Stores (announced on 6/30/06 that it has agreed to be acquired by Bain Capital and Blackstone)

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Market Data on Selected Food Retail Companies1

Enterprise Value/

Food Retailers

Kroger 21.81 16,041 22,555 0.36 0.35 0.34 6.8 6.5 6.2 15.4 14.0 1.69 1.53 9.1

Koninklijke Ahold3 8.53 13,262 19,541 0.34 0.34 0.33 7.2 6.2 5.8 14.4 12.1 1.51 1.28 9.5

Safeway 24.75 11,229 17,509 0.45 0.44 0.42 7.7 7.0 6.6 15.4 13.8 1.68 1.51 9.2

Delhaize3 69.50 6,661 9,540 0.40 0.39 0.38 5.5 5.2 5.0 12.9 11.8 1.29 1.18 10.0

Weis Markets 38.99 1,054 970 0.44 0.42 0.41 7.8 7.2 7.1 16.2 16.0 2.71 2.66 6.0

Great Atlantic & Pacific Tea4 21.43 888 745 0.09 0.10 0.10 5.9 5.1 4.4 nm nm nm nm 4.0

Pathmark Stores 8.56 538 986 0.25 0.25 0.24 5.2 7.5 6.9 nm nm nm nm 8.0

Mean 0.33 0.33 0.32 6.6 6.4 6.0 14.9 13.5 1.78 1.63 8.0

Median 0.36 0.35 0.34 6.8 6.5 6.2 15.4 13.8 1.68 1.51 9.1

High 0.45 0.44 0.42 7.8 7.5 7.1 16.2 16.0 2.71 2.66 10.0

Low 0.09 0.10 0.10 5.2 5.1 4.4 12.9 11.8 1.29 1.18 4.0

Lassie Bid 29.00 1,691 1,827 0.90 0.83 0.76 8.6 8.2 7.7 22.2 19.5 1.48 1.30 15.0

Lassie Bid (management projections) 0.83 0.76 8.1 7.2

Notes:

1 Financial projections per I/B/E/S consensus estimates; all projections (including Rover) calendarized to December year end

2 Enterprise Value equal to fully diluted equity value plus total debt and minority interest minus cash and cash equivalents (all at book value, except for Great Atlantic & Pacific Tea)

Stock Price, FD Equity Value and Enterprise Value converted from Euros to U.S. dollars for comparison purposes

4 Enterprise value is adjusted for (a) a special cash dividend paid but not reflected in the latest balance sheet and (b) an equity stake in Metro Inc. at market value

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Selected Specialty Retail Precedent Transactions

FD Equity Value ($mm) Enterprise Value1 ($mm)

Announcement EV/LTM (x) Premium to Stock Price (%)

Date Acquiror Target Target Sector Sales EBITDA 1 Day 1 Week 1 Month

6/30/2006 Bain Capital LLC/The Blackstone Group Michaels Stores, Inc Specialty Arts & Crafts 6,046 5,602 1.52 11.0 15.8 16.4 13.0

1/22/2006 Leonard Green Sports Authority Sporting Goods 1,046 1,396 0.56 8.1 20.0 26.0 20.7

12/22/2005 Best Buy Co., Inc Pacific Sales Kitchen & Bath Centers Upscale Home Improvement na 410 1.30 9.7 na na na

11/23/2005 Ares Management Orchard Supply Hardware2 Home Improvement na 777 0.88 8.6 na na na

11/8/2005 Apollo Management Linens ‘n Things Specialty Home Furnishings 1,292 1,296 0.49 8.6 7.9 14.9 17.0

9/26/2005 Berkshire Partners/Weston Presido Party City Party Supplies na 350 0.70 12.5 42.5 33.8 32.6

4/15/2005 J.W. Childs, Osim International, Temasek Brookstone Upscale Home Goods 441 410 0.80 8.5 28.2 21.8 40.7

Holdings

3/17/2005 Bain Capital/KKR/Vornado Toys “R” Us Toy Retail 6,607 8,184 0.72 11.2 17.0 21.6 23.2

11/26/2004 Bain Capital Dollarama Deep Discount 885 506 1.75 10.5 na na na

6/21/2004 Dick’s Sporting Goods Galyan’s Sporting Goods 305 362 0.50 10.6 53.1 51.9 76.3

3/31/2004 Circuit City InterTAN Consumer Electronics 291 266 0.57 7.7 22.2 22.2 22.2

10/17/2003 Apollo Management GNC Health Supplements 735 750 0.55 5.8 na na na

7/14/2003 Boise Cascade OfficeMax Office Supplies 1,121 1,066 0.22 8.4 25.3 31.0 36.2

6/19/2003 Bed Bath & Beyond Christmas Tree Shops Giftware & Household Products 194 194 0.53 na na na na

5/16/2003 Dollar Tree Stores, Inc Greenbacks Deep Discount 100 128 0.78 na na na na

2/20/2003 Gart Sports The Sports Authority Sporting Goods 188 339 0.24 5.0 nm3 nm3 nm3

12/2/2002 Bear Stearns Merchant Banking Vitamin Shoppe Health Supplements na 320 1.22 7.1 na na na

8/14/2001 Best Buy Co., Inc Future Shop Canadian Consumer Electronics 377 377 0.28 6.6 47.8 51.8 53.8

6/4/2001 Tweeter Home Entertainment Sound Advice Consumer Electronics 143 170 0.83 12.1 91.7 116.3 149.1

2/22/2001 Gart Sports Oshman’s Sporting Goods 84 100 0.31 6.3 38.1 37.4 37.7

12/8/2000 Bain Capital & KB Toys Management KB Toys4 Toy Retail 258 305 0.18 2.8 na na na

12/7/2000 Best Buy Co., Inc Musicland Stores Specialty Home Entertainment 425 685 0.35 4.6 22.4 93.1 59.4

8/3/2000 Best Buy Co., Inc Magnolia Hi-Fi Upscale Consumer Electronics 88 88 0.81 na na na na

5/17/2000 Leonard Green/TPG Petco Animal Supplies Pet Supplies 464 557 0.54 6.0 49.8 70.0 90.3

1/24/2000 Grupo Sanborns (Grupo Carso) CompUSA Consumer Electronics 947 1,005 0.16 10.2 6.3 85.7 92.4

Mean 1,049 1,026 0.67 8.3 32.5 46.3 51.0

Median 425 410 0.56 8.5 25.3 33.8 37.7

High 6,607 8,184 1.75 12.5 91.7 116.3 149.1

Low 84 88 0.16 2.8 6.3 14.9 13.0

Lassie Bid @ $ 29.00 1,691 1,827 0.90 8.6 49.1 48.3 55.2

Notes:

1 Enterprise Value equal to fully diluted equity value plus total debt and minority interest minus cash and cash equivalents (all at book value)

2 Ares acquired 19.9% of the equity; precedent assumes exercise of option for additional 30.2% equity stake at $128.8mm, with equity value grossed up to 100% and includes revolver, CBMS and seller note to Sears

Merger of equals

From Consolidated Stores

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Discounted Cash Flow Analysis

Unlevered Free Cash Flow Buildup

Projected Fiscal Year Terminal

($mm) 2H 2006E1 2007E 2008E 2009E 2010E 2011E Cash Flow

EBITDA $140.1 $255.7 $297.9 $334.5 $369.6 $406.4 $406.4

Less: Depreciation & Amortization (45.7) (101.0) (116.3) (128.5) (140.0) (151.6) (96.0)

EBIT $94.4 $154.7 $181.6 $206.0 $229.6 $254.8 $310.4

Less: Taxes @ 40.0% (37.8) (61.9) (72.6) (82.4) (91.9) (101.9) (124.1)

NOPAT $56.7 $92.8 $108.9 $123.6 $137.8 $152.9 $186.2

Plus: Depreciation & Amortization 45.7 101.0 116.3 128.5 140.0 151.6 96.0

Less: Capital Expenditures (66.4) (140.9) (137.0) (129.2) (127.3) (130.6) (100.0)

(Increase) / Decrease in Working Capital 12.7 (13.3) (5.1) (3.1) 0.1 0.1 0.1

Unlevered Free Cash Flow $48.7 $39.6 $83.2 $119.8 $150.5 $174.0 $182.4

Source: Rover management projections and assumptions Note:

Includes results from 53rd week

Key Assumptions:

July 31, 2006 transaction date (end of Q2)

Management projections and estimates through FY 2011

Capital expenditures normalized for terminal cash flow

New store CapEx reduced to 15 stores; remodel store CapEx increased by an additional 15 stores; additional maintenance CapEx

D&A equals 96% of CapEx

Tax rate of 40%

Period cash flows discounted using mid-year convention

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Discounted Cash Flow Analysis

Total Enterprise Value ($mm)

Terminal EBITDA Multiple

5.0x 5.5x 6.0x 6.5x 7.0x

12.5% $1,485.9 $1,592.2 $1,698.5 $1,804.9 $1,911.2

13.0% 1,454.7 1,558.4 1,662.1 1,765.9 1,869.6

Discount 13.5% 1,424.2 1,525.5 1,626.7 1,728.0 1,829.2

Rate 14.0% 1,394.6 1,493.4 1,592.3 1,691.1 1,789.9

14.5% 1,365.8 1,462.3 1,558.7 1,655.2 1,751.7

Implied 2006E TEV / EBITDA Multiple1 (x)

Terminal EBITDA Multiple

5.0x 5.5x 6.0x 6.5x 7.0x

12.5% 6.7x 7.1x 7.6x 8.1x 8.6x

13.0% 6.5x 7.0x 7.5x 7.9x 8.4x

Discount 13.5% 6.4x 6.8x 7.3x 7.8x 8.2x

Rate 14.0% 6.3x 6.7x 7.1x 7.6x 8.0x

14.5% 6.1x 6.6x 7.0x 7.4x 7.9x

Price Per Share2 ($)

Terminal EBITDA Multiple

5.0x 5.5x 6.0x 6.5x 7.0x

12.5% $22.86 $24.65 $26.45 $28.24 $30.03

13.0% $22.33 $24.08 $25.83 $27.58 $29.33

Discount 13.5% $21.81 $23.53 $25.24 $26.94 $28.65

Rate 14.0% $21.31 $22.99 $24.65 $26.32 $27.99

14.5% $20.81 $22.46 $24.09 $25.72 $27.34

Implied Perpetuity Growth Rate3 (%)

Terminal EBITDA Multiple

5.0x 5.5x 6.0x 6.5x 7.0x

12.5% 3.2% 4.0% 4.7% 5.2% 5.7%

13.0% 3.7% 4.5% 5.1% 5.7% 6.2%

Discount 13.5% 4.2% 4.9% 5.6% 6.2% 6.7%

Rate 14.0% 4.6% 5.4% 6.1% 6.6% 7.1%

14.5% 5.1% 5.9% 6.5% 7.1%

7.6%

Notes:

2006E EBITDA per current I/B/E/S consensus mean calendar year estimate

2 Price per share calculated net of debt ($184.4mm), inclusive of cash ($25.0mm) at 7/31/06E; fully diluted shares calculated per treasury method, based on latest share and option count from public filings and restricted stock units data from Company

3 Perpetuity growth rate that equals the terminal value calculated as of 1/31/12 as a multiple of trailing EBITDA at the corresponding multiples and discount rates

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SECTION 3

Other Information

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Premiums Paid Analysis

The following analysis shows the premiums paid in selected announced and closed transactions with enterprise values between $1.0 billion and $2.0 billion announced since 20031

Premium to Stock Price (%)

One Day Prior

40 (%) 20

24.2

Mean

21.4

Median

49.1

Lassie Bid²

One Week Prior

40 (%) 20

25.7

Mean

22.7

Median

48.3

Lassie Bid²

One Month Prior

40 (%) 20

27.6

Mean

24.9

Median

55.2

Lassie Bid²

Source: Securities Data Corporation

Notes:

92 transactions announced and closed

Assumes announcement date of July 13, 2006

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Comparison of Management Projections

The following highlights the change in management’s EBITDA and margin projections from their original forecast to the final projections shared with UBS, Lassie, and Spot

450.0 400.0 350.0 300.0 250.0 200.0 150.0 100.0 50.0 0.0

Original Case CAGR: 9.1% Revised Case CAGR: 12.4%

241.2

10.9%

226.9

10.3%

265.5

11.0%

255.7

10.6%

290.6

11.1%

297.9

11.3%

318.6

11.2%

334.5

11.7%

345.5

11.2%

369.6

12.0%

372.9

11.3%

406.4

12.3%

2006¹ 2007 2008 2009 2010 2011

% Change: (6.0%) (3.7%) 2.5% 5.0% 7.0% 9.0%

Original Management Case

Revised Management Case

Note:

2006 presented on 52-week basis

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Comparative Trading Performance — Last 2 Years

EV/LTM EBITDA

14.0X 12.0X 10.0X

8.0X 6.0X 4.0X 2.0X 0.0X

Average Multiple Difference

Last Twelve Months: 2.1x Last Two Years: 2.0x

7/10/2004 11/10/2004 3/10/2005 7/10/2005 11/10/2005 3/10/2006 7/10/2006

Rover

Spot

Source: FactSet