I@N - COPY
&-%.T IUYL and Export) limited
1-Noking
DGMSCRION-265
21stjuly 1992
Note to Dick Brentnall
Dear Dick.
REF: Canada Duty Free
Rease Rnd armched. a price structure proposal for the 3 main Duty Free apenamrs in Canada. The
main assumptions that have been made are as follows:
I . Duty Free remil price will be at the same level as ITC produce.
2. Discounts for Duty Free operators are based on:
Allders - participation allowance 6%
UCS - $1 10 per carcon ($6.00 per mille)
DFS - 10% discount
3. Invoice price to Dury Free operators YAW be the same price as Rothmins KS.
4. ITC commission of I 0-M on FOB.
I have also attached a 5 year financial evaluation which is based an the following:
1. An exchange rate of 1.95 Canadian Dollars to Z 1.00
2. Volume is split equally arrongst the 3 DF operators giving an average NSV of LI 3.74.
3. There is a 4% invoice price increase per annum.
4. In year one there is an allocation of 10% free goods. equivalent to 300.000 cigaremes.
which Is offe-ed FOC with the first order.
S. There is m/m support going from L3000 per annum to L-5500 per an.-,----n in year S.
I hoPe this meets with your requirements and I look forward to hearing your comments.
Kincert regards
DAVID NEWBERRY
CC C Costa
j Pothecary
F Lloyd
R Mammoras
00
CD
BATCo document for Province of BritiSh Columbia 14 April 1999