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ANNUAL REPORT 2011/2012 1 MAKING CONNECTIONS Annual Report 2011–2012
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MAKING - Province of Manitoba

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Page 1: MAKING - Province of Manitoba

ANNUAL REPORT 2011/2012 1

MAKING CONNECTIONSAnnual Report 2011–2012

Page 2: MAKING - Province of Manitoba

MAKING CONNECTIONS2

Page 3: MAKING - Province of Manitoba

ANNUAL REPORT 2011/2012 3

TABLE OF CONTENTSIntroduction Message from the Board Chair ............................................4

Message from the President & CEO ....................................7

Mandate ...............................................................................8

Growth ..................................................................................9

ConnectionsVisitors ................................................................................11

2011/12 Marketing Campaign ............................................12

Meeting, Conventions and Events .....................................14

Fishing & Hunting ...............................................................16

Media ..................................................................................20

International Audiences ......................................................25

Industry with Learning Opportunities .................................26

Industry and Knowledge .....................................................32

Industry Partners ................................................................36

Board of Directors ..............................................................42

Our People ..........................................................................43

Financial Statements ..........................................................45

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MAKING CONNECTIONS4

MESSAGE FROM BOARD CHAIR

Tourism is one of the largest and fastest

growing economic sectors in the world,

and international tourist arrivals are

projected to reach 1.6 billion worldwide

by 2020. According to the United Nations

World Tourism Organization (UNWTO)

2012 tourism highlights, despite

occasional shocks, international tourist

arrivals have shown virtually uninterrupted

growth – from 277 million in 1980 to 528

million in 1995, and 983 million in 2011.

They are expected to reach one billion in

2012 for the first time.

While tourism has experienced continued

expansion and diversification, many new

destinations have emerged, challenging

the traditional ones of Europe and North

America. Emerging economy destinations

have grown faster than advanced

economy destinations, and according

to the United Nations World Tourism

Organization, this trend is set to continue

in the future.

So what does this mean for Canada, and

specifically, for Manitoba?

We know that Canada has high-quality

tourism experiences, and the Canada

brand is resonating with potential

customers, now ranked #1 by the

country brand index prepared by Future

Brand. Manitoba’s tourism experiences

are competitive with any of those in

the country, and several have received

recognition through the Canadian

Tourism Commission’s Signature

Experience program.

“ It is time that the world’s governments really sit up and take notice of the Travel & Tourism industry. As a driver of economic recovery and growth in a very turbulent time, the industry stands apart for the sheer scale of its ability to create jobs and growth in every part of the globe.”

– David Scowsill, President and CEO, World Travel and Tourism Council

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ANNUAL REPORT 2011/2012 5

The importance of tourism in Manitoba

cannot be underestimated. Tourism

contributed $1.3 billion to our economy in

2010, with the majority of visitor spending,

61%, coming from residents travelling

within the province. It is also an important

export industry, as visitors from outside of

Manitoba spent over half a billion dollars in

communities throughout the province.

Tourism means jobs for Manitobans.

We have over 5,300 tourism businesses

operating in the province, creating close to

25,000 direct, indirect and induced jobs.

The question now facing our tourism

industry is, “How do we harness the

power of tourism for the betterment of the

industry and the citizens of this province?”

We need to make sure that every dollar

invested in tourism – by both the public

and private sectors – achieves maximum

impact. By working together, we can

avoid duplication of effort and increase the

prosperity of our province.

Canada’s national tourism marketing

organization, the Canadian Tourism

Commission (CTC), has identified

alignment and innovation as the two

critical components of its corporate

strategy for 2012–2016. These twin

priorities will be critical as Canada goes

head to head with new destinations

offering exotic tourism experiences.

Tourism marketing is already a fiercely

competitive business with variables that

often can’t be controlled. As a result, we

must work smarter than our competitors.

Travel Manitoba’s goal is to create a

single vision for tourism growth, one that

aligns the efforts of governments and

the business community. By working

together with our stakeholders, we

believe we can build a competitive

tourism strategy, one that ensures

Manitoba achieves its potential as an

economic engine, and ensures its place

on the tourism world stage.

Bob Sparrow CHAIR OF THE BOARD OF DIRECTORS

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ESPLANADE RIEL, WINNIPEGPhoto by: Blaine Harrington

MAKING CONNECTIONS6

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ANNUAL REPORT 2011/2012 7

MESSAGE FROM THE PRESIDENT & CEO

Colin Ferguson PRESIDENT & CEO, TRAVEL MANITOBA

In Manitoba, and across Canada, we face the

challenge of fragmentation in the tourism

industry. Effective marketing of Manitoba

as a premier tourism destination requires

agreement and cooperation amongst a wide

range of stakeholders, and the public and

private sector must work together within

limited budgets.

2011 was a year of transition for Travel

Manitoba as we developed a new, solid

business plan for the next three years, one

that builds towards our vision of leading the

marketing and development of Manitoba’s

tourism industry.

Travel Manitoba’s top priority towards

realizing this vision is to lead the industry

with marketing, communications and media

relations excellence. As much as we may not

think of tourism as “retail,” we are, in fact, in

the business of selling, and we need to reflect

that in our marketing approach.

Travel Manitoba is committed to developing a

new, “awe-inspiring” brand that distinguishes

Manitoba from the competition; a brand that

offers a differentiating vision with which

all stakeholders can align their individual

marketing efforts. One of the most important

tactical principles in branding is the concept of

alignment. Alignment is the key to maximizing

the effectiveness of marketing and branding

efforts. We, as Manitobans, should be proud

of our home and our tourism experiences, and

a new, awe-inspiring brand will turn Manitoba

residents into our greatest ambassadors.

Another key strategic priority for Travel

Manitoba is to strengthen our relationships

with business and government. We will

continue to expand Manitoba’s presence in

target markets by partnering with business

through advertising sales, partnerships,

e-marketing and special promotional

opportunities. Partnership revenues are put

back into marketing and communicating

Manitoba’s message to primary and secondary

markets. We also take seriously our role to

identify emerging market trends and provide

information, research and assistance to

tourism operators to capitalize on these trends.

Manitoba is on a roll, with new assets coming

to market and significant investments being

made in Winnipeg and throughout the

province that are further positioning Manitoba

as a unique destination of choice. Now is

the time to capitalize on these investments

by marketing and

communicating them

to the world.

d

them

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VISIONTravel Manitoba will lead the marketing and development of Manitoba’s tourism industry.

MISSIONGrow tourism revenues by harnessing the collective investment in tourism to create strong connections between visitors and Manitoba’s unique experiences.

MAKING CONNECTIONS8

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ANNUAL REPORT 2011/2012 9

$1.3 BILLION in visitor spending (Stats Canada TSRC and ITS 2010)

8.6 MILLION visitors

$492 MILLION in export revenue

24,800 JOBS

$554 MILLION in tax revenues for governments

Record growth in 2010 due to increased

investment in marketing

5.8% GROWTHtotal expenditure growth

2010 versus 2009

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“ For over 16 years, the collaboration Parks Canada has had with Travel Manitoba at the Explore Manitoba Centre has been a win-win situation, benefiting both organizations and most importantly the public. Our respective goals and mandates complement each other well and enable the public to receive a full range of information in both official languages about the national parks, national historic sites and provincial attractions in Manitoba. Parks Canada highly values its collaborative working relationship with Travel Manitoba.”

MARILYN PECKETT, Superintendent, Manitoba Field Unit, Parks Canada Agency

MAKING CONNECTIONS10

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ANNUAL REPORT 2011/2012 11

Visitor counselling sessions

UP 22% Participation in the Visitor Service

Network program up from

6 AFFILIATES TO 8 Traffic to travelmanitoba.com

UP 66%Traffic to manitobamonsters.com

UP 376%Facebook fans up from

1,500 TO 11,265Visitor inquiries

UP 11%

CONNECTING WITH VISITORSIn 2010, Travel Manitoba launched a Visitor

Services Network pilot program to better

meet the informational needs of travellers

across Manitoba. By partnering with

existing visitor information centres in areas

where Travel Manitoba did not have

a presence, and providing signage and

training, the program has strengthened our relationship with tourism partners and has enhanced the availability and quality of visitor information. Participation in the

program continued to grow in 2011/12.

In 2011/12, Travel Manitoba expanded

its presence on social media sites like

Facebook, Twitter, and YouTube. Through

daily efforts and contests, our social media

engagement has increased significantly.

Supplementary microsites like Everything

Churchill, Manitoba Monsters and What’s

Hot?, along with associated “AdWord”

campaigns, continued to drive increases

to the number of unique visitors seeking

information on Manitoba’s tourism

products. Pay-per-click ad campaigns for

Churchill and Culture on Every Corner

achieved significant click-through-rates of

.66% and .52% respectively.

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2011/12 MARKETING CAMPAIGN

Partnership opportunities for industry in the It’s Manitoba Time” campaign included:

Profile in full-page ads in the Winnipeg Free Press Saturday Travel section. In a new partnership with the Winnipeg Free Press, every Saturday featured a full-page article on a tourism product sector or region of the province.

Winnipeg Free Press newspaper ads establishing a “Manitoba Bucket List,” a list of events and attractions that are “must see, must do” items for any visitor to Manitoba.

Winnipeg Free Press.

What’s Hot?, sponsorship of e-newsletters and e-cards.

MAKING CONNECTIONS12

WINNIPEG FREE PRESS TRAVEL SECTION ADSWINNIPEG FREE PRESS “BUCKET LIST” ADSVACATION PLANNER

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ANNUAL REPORT 2011/2012 13ANNUAL REPORT 2011/2012 13

In 2011/12 Travel Manitoba launched the “It’s Manitoba Time” campaign, designed around key brand elements identified in the strategy.

WHAT’S HOT WEBSITEPARTNER E-CARDWINNIPEG FREE PRESS EVENT WEBSITE

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MEETINGS, CONVENTIONS AND EVENTSVisitors attending meetings, conventions and events contribute significantly to Manitoba’s annual tourism receipts.

Team Winnipeg 2011/12 Results

was able to convert 18 national conferences, held from

2011 to 2015, representing 5,654 delegates with an

estimated revenue of $5,365,646.

2011, resulting in three confirmed conferences representing

2,300 delegates with an estimated delegate spend of

$2,182,700.

Travel Manitoba partners with Tourism

Winnipeg on Team Winnipeg, which

provides a united marketing plan and sales

partnership to promote Winnipeg as an ideal

destination to hold a meeting or convention.

There are now 54 Team Winnipeg partners,

including new partners Manitoba Lotteries,

Rainbow Stage, Corporate Source, Nordik

Spa-Nature and the Canadian Museum for

Human Rights.

MAKING CONNECTIONS14

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ANNUAL REPORT 2011/2012 15

Travel Manitoba also provides support to Brandon First and Destination Dauphin to target meetings, conventions, incentive travel and major events to these areas. In 2011, Brandon First was successful in landing the 2013 Senior Women Administrator Academic Conference and the 2011 Red River Cup. Travel Manitoba’s Sport Tournament Marketing Partnership also resulted in the establishment of a new invitational tournament – Curl Manitoba’s Sun Life Junior Challenge, held in Brandon.

ANNUAL REPORT 2011/2012 15

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In April 2011, Travel Manitoba held the first

“Fish/Hunt Summit,” now an annual event

that brings together Travel Manitoba staff,

members of the Manitoba Lodges and

Outfitters Association (MLOA) and industry

representatives from across the province.

This working session is an opportunity for industry operators and the Travel Manitoba team to come together to identify on-going challenges confronting the fish/hunt sector and discuss new marketing opportunities.

It is also an opportunity to clarify roles and

responsibilities of the MLOA, individual

operators and Travel Manitoba as related to

marketing, advocacy and intergovernmental

relations. The feedback received at the

summit is used to shape the annual

marketing plan for the fish/hunt sector.

FISHING & HUNTING

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“ This is a rare opportunity to participate in a government entity and personally I see these meetings as such a great chance to partner, and am more than willing to share my time with you and your department personalities. Now it looks as we may have an advocate beside a business community that delivers the Fish/Hunt product.”

RON DARE, Bear Track Outfitters

ANNUAL REPORT 2011/2012 17

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MAKING CONNECTIONS18 MAKING CONNECTIONS18

THE HOCKEY NEWS ADSWORLD FISHING NETWORK PROMOTIONAWARD-WINNING PROMOTIONAL BROCHURE

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2011/12 FISH/HUNT HIGHLIGHTSWild Hunting and Fishing Television Network

for on-location shoots for bear, caribou, deer and moose hunting, for programs to air in 2013.

The Hockey News in campaigns and promotions for both fishing and hunting. “The Biggest Catch” contest resulted in over 52,000 contest entries.

World Fishing Network to feature Manitoba on “Hookin’ up with Mariko Izumi.”

Manitoba’s world-class hunting and fishing won the Best Direct Mail award in the annual Signature Awards, a celebration of the best in Manitoba marketing.

from 2,700 unique visitors in 2010/11 to 13,000 in 2011/12.

ANNUAL REPORT 2011/2012 19

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CONNECTING WITH MEDIA

We work closely with our tourism partners

to host and facilitate travel media as they

explore our province. In 2011/12, our tourism

partners helped to augment the Media Tour

program budget by an additional quarter

million dollars worth of in-kind support.

In 2011, seven group media trips were the

most ever conducted and targeted both

international and high-volume media. The

trips broadened exposure of Winnipeg,

Manitoba’s Interlake, the Parkland region and

the summer Churchill experience.

Communicating with travel media was

amplified in 2011 with the addition of online

tools such as the travel media website, Write

Angles e-newsletter and social media.

The Media Tour program generates the most publicity about Manitoba travel experiences.

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ANNUAL REPORT 2011/2012 21

Photojournalist Qun Chen comes face-to-face with a polar bear in his piece Polar Bear Diary for China’s National Geographic Traveler:

“ One moment a bear was sitting in the snow watching us, and then the next standing up on his hind legs. His front paws pushed the Tundra Buggy. His black eyes and nose were less than one metre away from me. I could feel his warm, wet breath on my face.”

January 2011 Circulation: 495,000 Value: $251,000

CO-HOSTED109 MEDIA PROJECTS30 from non-U.S. core markets

$6.8 MILLIONin earned coverage

Twitter followers up from

800 TO 1,500REACHED POTENTIAL AUDIENCE OF

194 MILLION in features, mentions and

broadcasts

Travel Manitoba’s online media centre was a proud finalist in the Canadian Tourism Commission’s online travel media awards, and team member Jillian Recksiedler

was a finalist in the CTC’s GoMedia GoGetter award for PR excellence.

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MAKING CONNECTIONS22 MAKING CONNECTIONS22

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ANNUAL REPORT 2011/2012 23

” Every time I return from Manitoba, be it for a Polar

Bear Safari, Snorkelling with Belugas, Whitewater

Canoeing down the Bloodvein River, or even exploring

the thriving TV production industry in Winnipeg, all of

my adventures are deemed unexpected by my editors,

family and friends, and for sure my readers.”

AMY ROSEN, columnist and freelance journalist

ANNUAL REPORT 2011/2012 23

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“ Polar bears and beluga whales are something that are truly unique, and when I see some of our potential visitors in our foreign markets looking at that product, their eyes are wide open...it’s like an African safari.”

STEVE ALLAN, Chair, Board of Directors, Canadian Tourism Commission

Photo Credit: Steve Allan

MAKING CONNECTIONS24

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ANNUAL REPORT 2011/2012 25

14 GERMAN media hosted

9 U.K. MEDIA trips conducted

MANITOBA FEATURE ON EXTREME FRONTIERS AIRED

TO 7 MILLIONU.K. visitors and the series has been picked up by more than 16 networks around the world.

Host Charley Boorman paddled the Bloodvein River and visited the Hotel Fort Garry.

5 U.K. TOUR OPERATORS participated in Travel Manitoba’s “Spring Song in Canada’s

Heartland” birding FAM trip, with three of the operators planning to carry Manitoba products in 2013.

HOSTED TWO TRAVEL TRADE AND TWO TRAVEL WRITERS FROM EACH OF

CHINA AND INDIAthat resulted in all four operators adding product and six

articles in India, three in China.

MET WITH OVER 50 ACTIVE TRADE PARTNERS

IN THE U.S. MARKETAND 39 NEW POTENTIAL PARTNERSat marketplaces including the National Tourism

Association, the U.S. Tour Operators Association, the American Bus Association and the Educational

Travel Conference.

CONNECTING WITH INTERNATIONAL AUDIENCES

Travel Manitoba’s international sales, media relations and travel trade teams worked to increase Manitoba exposure in priority international markets including the United States, United Kingdom and Germany and emerging markets such as China.

There are now 95 tour operators

featuring Manitoba product in the

U.K., a 9.2% increase over the

previous year. In Germany, 34 tour

operators now offer Manitoba

experiences, up from 31 in 2010.

Sales activities were augmented by

the additional funding, with sales

missions conducted to California,

Minnesota, Germany and the

U.K., and attendance at five North

American marketplaces, Focus

Canada in India and China, and at

Rendez-vous Canada.

Funding received under a three-year Canada-Manitoba Economic Partnership

Agreement allowed Travel Manitoba to build on previous successes in increasing

visitors from international markets.

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MAKING CONNECTIONS26

CONNECTING INDUSTRY WITH LEARNING OPPORTUNITIES

The tourism industry website, a monthly

e-newsletter and a daily e-news bulletin

keep industry members informed about the

services of Travel Manitoba, current research,

best practices and issues affecting the

tourism industry on a provincial, national and

international level.

Travel Manitoba aims to be the first resource that tourism industry operators consider when they are looking for tourism information, development assistance and marketing advice.

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ANNUAL REPORT 2011/2012 27

Subscriptions to industry newsletter,TRAVEL CURRENTS UP

13.6%iT

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EXPERIENTIAL TOURISM

travel that engages visitors in

memorable travel activities that are

personal, utilize the senses, and make

connections on a physical, emotional,

spiritual, social or intellectual level.

In 2011/12, Travel Manitoba hosted

two sessions of a multi-day product

development training program

called “The Cutting Edge” to support

industry operators in developing this

type of experience.

The program is modelled after a

similar program pioneered in Atlantic

Canada through the Gros Morne

Institute for Sustainable Tourism

(GMIST). The program combines

classroom instruction and “learning

by doing” to provide a unique and

effective educational experience. Thirty-

six tourism operators participated in

one of two sessions, in October 2011

in the Riding Mountain National Park

area and in March 2012 in Winnipeg.

These operators are now trained to

develop new experiences for 2013.

In 2010, Travel Manitoba laid the groundwork for moving towards “experiential tourism” development,

MAKING CONNECTIONS28

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ANNUAL REPORT 2011/2012 29ANNUAL REPORT 2011/2012 29

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INDUSTRY WORKSHOPS

Travel Manitoba has provided

industry operators with access to

workshops conducted by social

media experts to help them

understand and fully utilize this

medium. Social media workshops

were conducted as part of the

Cutting Edge program, as well as

at the request of some regional

tourism associations.

In partnership with the Economic

Development Council of Bilingual

Municipalities of Manitoba

(CDEM), Travel Manitoba also

hosted a Media Relations

workshop in March 2012 to

help improve participants’

understanding of the main

elements of media relations and

assist them in the development

of a media relations plan.

As social media becomes an increasingly powerful tool for influencing and motivating potential visitors,

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ANNUAL REPORT 2011/2012 31

With the theme “Sharing the Manitoba Story

– Building the Visitor Experience,” the focus

of the conference was on how to incorporate

elements that are distinctly Manitoban in

tourism products to ensure memorable

experiences for the visitor. Keynote speaker,

Dr. Nancy Arsenault, spoke to the importance

of experiential tourism in the context of the

storytelling theme. She outlined how tourism

operators can benefit from storytelling to

make meaningful connections throughout the

customer lifecycle.

The conference featured sessions on

emerging markets, social media, global

trends, customer service, media relations,

sustainable tourism and collaboration and

partnerships – all important topics for a

successful tourism operation.

The 13th Annual Manitoba Tourism Awards

followed the first day of the conference,

with over 225 tourism industry members

attending the gala evening. The awards

celebrate outstanding contributions to

the provincial tourism industry, including

promoting Manitoba as a destination,

providing memorable service to visitors and

developing the tourism industry.

Fifty-five nominations for the awards were

submitted and 27 were chosen as finalists.

Finalists and winners in nine categories were

selected by an industry-based judging panel.

CONFERENCE AND AWARDSOn April 11, 2011, over 150 Manitoba tourism industry members gathered for the two-day Manitoba Tourism Conference.

TRAVEL MANITOBA AWARD OF DISTINCTION Dauphin’s Countryfest

ASPIRING YOUTH AWARD Monique Olivier

ABORIGINAL TOURISM AWARD St. Malo Festival of Friends-Festival des Amis

MARKETING EXCELLENCE AWARD Manitoba Homecoming 2010

PARTNERSHIP AWARD West Interlake Trading Company

PRODUCT DEVELOPMENT AWARD The Incorporated Community of Nelson House Fishing Derby Service Excellence Award – Aikens Lake Wilderness Lodge

SUSTAINABLE TOURISM AWARD Dauphin’s Countryfest

VOLUNTEER OF THE YEAR AWARD Bette Mueller

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Travel Manitoba continually shares research and market intelligence about the industry’s economic health, trends within and influences on the industry, and forecasts of future conditions. In order to provide this information, Travel Manitoba often relies on industry to provide anonymous data and observations, which can then be analyzed collectively to provide a picture of the industry overall or segments within the industry.

MAKING CONNECTIONS32

THE EXPLORER QUOTIENT

CONNECTING INDUSTRY AND KNOWLEDGE

In 2011/12, Travel Manitoba made the

decision to invest in the Canadian Tourism

Commission’s innovative market segmentation

tool called The Explorer Quotient, or EQ.

EQ goes beyond traditional market research

to find out why people travel and how their

personal beliefs, social values and view of

the world shape the type of travel decisions

they make.

Travel Manitoba has invested in this tool to

help Manitoba tourism businesses with their

marketing plans and tourism development

strategies. Using the EQ program, operators

will be better able to understand their

customers, the types of experiences they

are after and the kind of message that will

resonate with them.

In future, Travel Manitoba will continue to

offer information sessions for industry on

how to market their products with EQ and

benefit from its insights.

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Fishing and Hunting SectorManitoba’s fishing and hunting outfitters

and lodges are a big part of this province’s

tourism industry, but there had been no clear

understanding of its economic impact for

several years. In 2011/12, Travel Manitoba

conducted an economic assessment of

Manitoba’s fishing and hunting sector. Among

other findings, the assessment showed that

total spending in Manitoba by hunters and

anglers totalled $469.1 million. Fifty-four

percent of that was spent on transportation,

including vehicle and boat purchases, fuel,

etc. That spending generated 6,180 full-

time jobs – nearly 1.2% of Manitoba’s

employment, while revenue for fishing and

hunting lodge operators stood at almost $35

million, or about 7% of total spending by

anglers and hunters.

The assessment surveyed over 130 operators

and 429 licence holders across Manitoba,

Canada and the U.S. The assessment

showed that satisfaction with Manitoba’s

fishing and hunting was great at nearly

eight or higher on a scale of ten. One of the

highlights of the assessment is the fact that

Manitoba operators participated, providing

financial information so that the study could

be completed.

Industry Survey Industry participation was also critical to the

completion of our latest Manitoba business

survey, undertaken between December 2011

and January 2012.

As part of our ongoing consultation with

industry, Travel Manitoba collects feedback

and market-related information from

Manitoba tourism businesses to aid in the

planning of future Travel Manitoba services

and programs.

Key findings of the survey:

and objectives of Travel Manitoba to zero in

on North America, as 96% of respondents’

marketing budgets are dedicated to those

markets.

to increase awareness and participation of

Travel Manitoba’s partnership and industry

programs.

marketing and promotion – identified as the

area that would help their organizations grow.

planning on developing new products,

experiences or packages in 2012.

information, an opportunity to introduce

the benefits of tracking customers through

training.

marketing themselves.

ANNUAL REPORT 2011/2012 33

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61%

25%

10%

4%

85%10%

4%

1%

VISITOR SPENDING & VISITATION OVERALL 2010MANITOBA

$765.9 million

7,327,000 person visits$105 per person visit

OTHER CANADIAN PROVINCES

$319.6 million

836,000 person visits$382 per person visit

UNITED STATES

$126.6 million

370,000 person visits$342 per person visit

OVERSEAS

$46 million

66,000 person visits$698 per person visit

TOTAL VISITOR SPENDING

$1,258,111,000TOTAL VISITATION

8,599,000

Source: Statistics Canada – Travel Survey of Resident of Canada (TSRC) and International Travel Survey (ITS), Research Resolutions – 2010 Detailed TabulationsReceipts for International Students & Commuters have been removed in the 2010 tables, due to an unacceptably low sample size.

MAKING CONNECTIONS34

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THE VALUE OF THE TOURISM INDUSTRY IN MANITOBAAccording to the latest statistics, in 2010 tourism in Manitoba contributed $1.3

billion to our economy with the majority of visitor spending, 61%, coming from

residents travelling within the province. Our next most important market at 25%

is other Canadian provinces visiting Manitoba, followed by the United States, a

key market, at 10%.

Overseas markets contribute 4% to our overall revenues, but while this represents

a small segment in terms of tourism visitations, they do represent a much higher

spend per visit. Manitobans travelling within the province spend an average of

$105 per visit while overseas visitors spend $698 per visit. Tourism is also an

export industry helping our balance of trade. Visitors from outside of Manitoba

spent over half a billion dollars in communities throughout the province last year.

The tourism sector creates jobs, especially for new entrants to the workforce. In

Manitoba, tourism sustains an excess of 24,800 direct, indirect and induced jobs.

ANNUAL REPORT 2011/2012 35

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Average per partner revenue up from $3,738 in 2010/11 to

$4,351 IN 2011/12

$139,000 in in-kind contributions

Over 92,000 webleads to operators

UP 6.4%

Partnership revenues from industry

UP 20%

CONNECTING WITH INDUSTRY PARTNERS

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ANNUAL REPORT 2011/2012 37ANNUAL REPORT 2011/2012 37

WITH THANKS TO ALL OF OUR INDUSTRY PARTNERSAikens Lake Wilderness Lodge All Terrain Bear Hunts Art Gallery of Southwestern Manitoba Asessippi Parkland Tourism Assiniboia Downs Assiniboine Park Conservancy Bed and Breakfast Manitoba Bennett Lake Lodge and Outcamps Ltd. Best Western Plus Pembina Inn & Suites Blaze Bistro Brandon Tourism/Brandon Riverbank Inc. Budd’s Gunisao Lake Lodge Buffalo Point First Nation Calm Air International LP CDC – Valley Inc. – Minnedosa CDEM Celebrations Dinner Theatre CG Emery International Children’s Museum Choice Hotels Canada – Western Regional Marketing

CommitteeChurchill Nature Tours Churchill Wild Clarion Hotel Continental Travel Group Culture on Every Corner Dauphin Economic Development & Tourism Delta Winnipeg Deseo Bistro EAST Inc. – Eastside Aboriginal Sustainable Tourism Elkhorn Resort Spa and Conference Centre Emerson Duty-Free Shop Falcon Trails Resort Inc. Folklorama FortWhyte Alive Frontiers North Adventures Gangler’s North Seal River Lodge / Canadian Sub-Arctic

Hunting Gimli Film Festival Go Orderly

Gods River Lodge Greenwood Inn and Suites Halfords Heartland International Travel & Tours Hendrick and Associates (Super 8) Hilton Suites Winnipeg Airport Holiday Inn Winnipeg Airport West Holiday Inn Winnipeg South Hospitality Plus Hy’s Steakhouse Ichiban Japanese Steak House Inn at The Forks Interlake Tourism Association Jackson’s Lodges & Outposts Jays Inn & Suites Lakeview Hotels & Resorts Lazy Bear Lodge Lea Meadow Outfitters Legend Boats Lynn Lake Fly-in Outpost Camps Manito Ahbee Festival Manitoba Association of Campgrounds and Parks Manitoba Conservation – Map Sales Manitoba Conservation – Parks & Natural Areas Manitoba Electrical Museum & Education Centre Manitoba Lotteries (Milt Stegall Drive) Manitoba Wildlife Federation MediaCom (Canadian Tire) Mennonite Heritage Village (Canada) Inc. Mid Canada Boat Show, RV Show Nature 1st (Adventure Walking Tours) New Iceland Heritage Museum Inc. Northern Spirit Lodge Norwood Hotel Oak Hammock Marsh Interpretive Centre Parkland Tourism Association Parks Canada (Attractions) Pelican Graphics Place Louis Riel Suite Hotel Provincial Exhibition of Manitoba

Public Works and Government Services Canada Rainbow Stage Red River Exhibition Ridgewood South Golf Course & Campground Riding Mountain National Park of Canada Royal Canadian Mint Royal Oak Inn & Suites Sasa-Ginni-Gak Lodge Schinkel Properties Second Nature, Adventures in Discovery Signature Museums Silsby Lake Lodge 2011 Inc. Simon Nabess Wayside Park South Beach Casino & Resort Stanley Black & Decker Super 8 – Dauphin Super 8 – Swan River The Central Museum of The Royal Regiment of Canadian

Artillery (The RCA Museum) The Fairmont Winnipeg The Forks North Portage Partnership The Fort Garry Hotel, Spa & Conference Centre The Great Canadian Travel Company Ltd. The Manitoba Museum Toad Hall Toys Tourism Westman Tourism Winnipeg Town of Carman Town of Melita Town of Morden Travelodge Canada Ukrainian Cultural & Educational Centre Victoria Inn Hotel and Convention Centre Webber’s Lodges Westwinn Group Wholesale Sports Winnipeg Art Gallery Winnipeg Folk Festival Winnipeg Symphony Orchestra Wolverine Lodge

ANNUAL REPORT 2011/2012 37

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STRATEGIC PRIORITIESSUCCESS WILL BE ACHIEVED BY FOCUSSING ON THE

FOLLOWING STRATEGIC PRIORITIES:

1. Leading Marketing Excellence

2. Strengthening Relationships with Business and Government

3. Collaborating to Build a Competitive Provincial Tourism Strategy

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ANNUAL REPORT 2011/2012 39

2012 TO 2015 OBJECTIVES

generate $1.7 billion through increased

visitation and increased yield per overnight

visitor by extending stays and increasing

visitation from long-haul markets

sector by partnering with business and

government

– Increase industry partnership revenues by

25% from a projected $800,000 in 2010

to $1 million by 2015

– Increase Travel Manitoba’s total annual

budget to $14 million by 2015

stakeholders:

– Aim to be the first resource that

tourism industry operators consider

when they are looking for tourism

information, development assistance

and marketing advice

– Align government and business

investment in tourism marketing

within Canada and internationally

Our long-term

objective is to

rank fifth in terms

of market share

amongst Canadian

provinces and

territories by 2017.

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4,000,000

3,800,000

3,600,000

3,400,000

3,200,000

3,000,000

2,800,000

2,600,000

2,400,000

2007 2008 2009 2010 2011e 2012f 2013f 2014

TOTAL OVERNIGHT VISITS

3,665,000

3,076,000

3,362,000

3,536,000

3,430,000

3,527,000

3,620,000

e = estimated

f = forecast

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ANNUAL REPORT 2011/2012 41

MANITOBA’S TOURISM INDUSTRY IS GROWING

a significant accomplishment as we increased

tourism revenues during a period of global

economic instability.

Enhanced investments in projects such as

Manitoba Homecoming 2010, Rendez-vous

Canada and expanded international marketing

programming made possible through the

three-year, $5 million Canada-Manitoba

Economic Partnership Agreement project

funding proved most successful as our

growth in tourism revenues increased

by 5.6% in 2010. A further indication of

the positive trends was echoed by the

Conference Board of Canada, which is

forecasting aggressive growth of 3.7% for

Manitoba in 2012.

Tourism in Manitoba has experienced steady growth and is very close to rebounding to our record levels for overnight visits as experienced in 2007,

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BOARD OF DIRECTORS

BOB SPARROW (Chair) Owner Norwood Hotel

MARION MORBERG (Vice-Chair) Board Member Spirit Way

GEORGE ALEVIZOS Controller Manitoba Government & General Employees’ Union

CYNTHIA CAMPBELL Corporate Controller Canadian Wheat Board

NORMAND GOUSSEAU Chief Executive Officer Entreprises Riel

MERV GUNTER Owner/Operator Frontiers North Adventures

HELEN HALLIDAY General Manager Delta Winnipeg

RIVA HARRISON Executive Director, Marketing and Communications CentrePort Canada Inc.

WADOOD IBRAHIM Chief Executive Officer Protegra

BILL KNOWLTON Vice President Sales & Marketing Jonview Canada Inc.

SONNY LAVALLEE Chairman, Board of Directors Northern Manitoba Trappers’ Festival

EVA LUK Principal Luk-Law

DARYL SILVER President Continental Travel Group

GERRY TURENNE President & CEO Turenne et Cie (2005) Ltee Management Consultants/ Consultants en Gestion

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ANNUAL REPORT 2011/2012 43

OUR PEOPLE Travel Manitoba’s people are vital links in the provincial tourism industry, consistently demonstrating their dedication

to enhancing tourism in Manitoba through program development and administration. Our people are committed to fiscal responsibility,

accountability and generating solid results.

ROW 1: Lindsay Penner, Yan Cong, Colin Ferguson, Michel LaRivière ROW 2: Brigitte Sandron, Ryan Schultz, Cathy Senecal, Lilian Tankard, Carol McDonald, Leigh Ens ROW 3: Lyall Wilson, Lori Klan, Cindy Perrett, Laurenda Madill, Karla Pratt, Claudine Gervais, Dené Sinclair ROW 4: A.J. Kelly, Diane Bobbitt, Lori Schmitt, Doug Evans, Stephanie Bachewich ROW 5: Rick Gaunt, Linda Whitfield, Rebecca McKie, Mark Clarke ANNUAL REPORT 2011/2012 43

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“ In 2012, the Interlake Tourism Association has increased its partnership with Travel Manitoba. We believe that partnering with Travel Manitoba allows our Association to stretch our marketing much further than if we tried to do it alone.”

GAIL MCDONALD, Manager, Interlake Tourism Association

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ANNUAL REPORT 2011/2012 45ANNUAL REPORT 2011/2012 45

FINANCIAL STATEMENTSFor the year ended March 31, 2012)

Independent Auditor’s Report 46

Financial Statements

Statement of Financial Position 47

Statement of Operations 48

Statement of Changes in Net Assets 48

Statement of Cash Flows 49

Summary of Significant Accounting Policies 50

Notes to Financial Statements 52

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To the Members of TRAVEL MANITOBA,

We have audited the accompanying financial statements of TRAVEL MANITOBA, which comprise the statement of financial position as at March 31, 2012, and the statements of operations, changes in net assets and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory information.

MANAGEMENT’S RESPONSIBILITY FOR THE FINANCIAL

STATEMENTS

Management is responsible for the preparation and fair presentation of these financial statements in accordance with Canadian generally accepted accounting principles, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures

selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OPINION

In our opinion, the financial statements present fairly, in all material respects, the financial position of TRAVEL MANITOBA as at March 31, 2012 and the results of its operations and its cash flows for the year then ended in accordance with Canadian generally accepted accounting principles.

Chartered AccountantsWinnipeg, ManitobaJune 27, 2012

Tel/Tél.: 204 956 7200Fax/Téléc.: 204 926 7201Toll-free/Sans frais: 800 268 3337www.bdo.ca

BDO Canada LLP/s.r.l.700 – 200 Graham AvenueWinnipeg, MB R3C 4L5 Canada

MAKING CONNECTIONS46

INDEPENDENT AUDITOR’S REPORT

BDO Canada LLP, a Canadian limited liability partnership, is a member of BDO International Limited, a UK company limited by guarantee, and forms part of the international BDO network of independent member firms.

BDO Canada s.r.l., une société canadienne à responsabilité limitée, est membre de BDO International Limited, société de droit anglais, et fait partie du réseau international de sociétés membres indépendantes BDO.

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ANNUAL REPORT 2011/2012 47

STATEMENT OF FINANCIAL POSITIONMarch 31 2012 2011

ASSETS

Current Assets

Cash and short-term deposits (Note 2) $ 1,215,653 $ 787,905 Trade accounts receivable 621,892 1,274,550 Prepaid expenses 35,988 29,740

1,873,533 2,092,195

Due from the Province of Manitoba (Note 3) 150,413 204,727

Capital assets (Note 4) 131,033 128,015

$ 2,154,979 $ 2,424,937

LIABILITIES AND NET ASSETS

Current Liabilities Accounts payable and accrued liabilities $ 1,273,683 $ 1,234,042

Deferred revenue 78,852 -

1,352,535 1,234,042Retirement allowances and

other benefits payable (Note 5) 454,633 441,434

1,807,168 1,675,476Contingencies and commitments (Note 7)

Net Assets

Unrestricted 141,778 546,446 Restricted for purchase of capital assets 75,000 75,000 Invested in capital assets 131,033 128,015

347,811 749,461

$ 2,154,979 $ 2,424,937

ANNUAL REPORT 2011/2012 47

Director

Approved on behalf of the Board of Directors:

Director

The accompanying summary of significant accounting policies and notes are an integral part of these financial statements.

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STATEMENT OF OPERATIONSFor the year ended March 31 2012 2011

Revenue

Province of Manitoba Operating $ 7,613,000 $ 7,602,000 Other initiatives – Federal and provincial funding 1,839,500 2,475,600 Partnership and leveraged marketing 712,446 493,880 Other 22,526 9,959

10,187,472 10,581,439

Expenditures

Marketing and industry development 8,442,340 7,822,996 Visitor services 1,173,506 1,448,637 Corporate services 953,784 782,805 Amortization 12,099 16,598 Contribution to Manitoba Homecoming Inc. 7,393 315,000

10,589,122 10,386,036 Excess (deficiency) of revenue over

expenditures for the year $ (401,650) $ 195,403

STATEMENT OF CHANGES IN NET ASSETSFor the year ended March 31 2012 2011

Restricted for Purchase Invested in Unrestricted of Capital Assets Capital Assets Total Total

Net assets, beginning of year $ 546,446 $ 75,000 $ 128,015 $ 749,461 $ 554,058

Excess (deficiency) of revenue over

expenditures for the year (389,551) - (12,099) (401,650) 195,403

Acquisition of capital assets (15,117) - 15,117 - -

Net assets, end of year $ 141,778 $ 75,000 $ 131,033 $ 347,811 $ 749,461

The accompanying summary of significant accounting policies and notes are an integral part of these financial statements.

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ANNUAL REPORT 2011/2012 49ANNUAL REPORT 2011/2012 49

STATEMENT OF CASH FLOWSFor the year ended March 31 2012 2011

Cash Flows from Operating Activities

Excess (deficiency) of revenue over expenditures for the year $ (401,650) $ 195,403 Adjustment for non-cash items Amortization 12,099 16,598 Loss on disposal of equipment - 23,825

(389,551) 235,826 Changes in non-cash working capital Trade accounts receivable 652,658 527,055 Prepaid expenses (6,248) 27,388 Accounts payable and accrued liabilities 39,641 (527,038) Deferred revenue 78,852 -

764,903 27,405

Due from Province of Manitoba 54,314 19,706

Retirement allowances and other benefits payable 13,199 (50,486)

442,865 232,451

Cash Flows from Investing Activities

Acquisition of capital assets (15,117) (22,626) Disposition of capital assets - 2,625

(15,117) (20,001)

Net increase in cash and cash equivalents 427,748 212,450

Cash and cash equivalents, beginning of year 787,905 575,455

Cash and cash equivalents, end of year $ 1,215,653 $ 787,905

The accompanying summary of significant accounting policies and notes are an integral part of these financial statements.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESFor the year ended March 31, 2012

Basis of Reporting The financial statements of the Organization have been prepared in accordance with Canadian generally accepted accounting principles.

Capital Assets Capital assets are recorded at cost less accumulated amortization and are amortized on a declining balance basis over the estimated useful lives of the assets at the following rates:

Computer hardware 30% Computer software 30% Furniture and equipment 5% Leasehold improvements 5%

Revenue Recognition The Organization follows the deferral method of accounting for contributions. Grant revenue is recognized in the period earned. Partnership and marketing revenue are recognized when services are rendered if the amount to be received can be reasonably estimated and collection is reasonably assured.

The Organization recognizes revenue arising from non-monetary transactions in the period when services have been rendered if the amount to be received can be reasonably estimated and collection is reasonably assured.

Financial Instruments The Organization classifies its financial instruments as follows based on the purpose for which the asset was acquired and follows the disclosed accounting policy for each category.

Assets/Liability Category Measurement

Cash and short-term deposits Held for trading Fair value Trade accounts receivable Loans and receivables Amortized cost Due from the Province of Manitoba Loans and receivables Amortized cost Accounts payable and accrued liabilities Other financial liabilities Amortized cost

Held for trading items are carried at fair value, with changes in their fair value recognized in the statement of operations.

impairment.

Transaction costs are expensed as incurred.

All transactions related to financial instruments are recorded on a settlement date basis.

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ANNUAL REPORT 2011/2012 51ANNUAL REPORT 2011/2012 51

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESFor the year ended March 31, 2012

Retirement Allowances and The Organization provides retirement allowance and pension benefits to its employees.

Retirement allowances are provided to certain qualifying employees. The benefits are provided under a final pay plan. The costs of benefits earned by employees are charged to expenses as services are rendered. The costs are actuarially determined using the projected benefit method and reflect management’s best estimates of the length of service, salary increases and ages at which employees will retire. Actuarial gains and losses are recognized in income immediately.

Employees of the organization are provided pension benefits by the Civil Service Superannuation Fund (“the Fund”). Under paragraph 6 of the Civil Service Superannuation Act, the Organization is described as a “matching employer” and its contribution toward the pension benefits is limited to matching the employees’ contributions to the Fund.

In addition, an individual has entitlement to enhanced pension benefits. The plan is based on final pay and is indexed. The cost of the benefits earned by the employee is charged to expenses as services are rendered. The cost is actuarially determined using the projected benefit method and reflects management’s best estimate of salary increases and the age at which the employee will retire.

Restricted Fund for A fund has been established by the Board of Directors in order to finance the future acquisition of capital items which are not funded by the Province of Manitoba through the provision of operating grants. Charges to the fund will occur at the discretion of the President and Chief Executive Officer. Any future redesignation of the fund balance would be subject to approval by the Board of Directors.

Use of Estimates The preparation of financial statements in accordance with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from management’s best estimates as additional information becomes available in the future.

New Accounting Pronouncements In December 2010, the Accounting Standards Board and Public Sector Accounting Board (“Boards”) issued new standards for not-for-profit organizations (NPOs) as follows:

For government (public sector) NPOs they have a choice of Public Sector Accounting standards with the current series of NPO-specific standards added with some minor changes or Public Sector Accounting standards. The Boards require NPOs to adopt their respective standards for year ends beginning on or after January 1, 2012; early adoption is allowed. Until the date of transition to the new standards, all NPOs will continue to follow the current Canadian Institute of Chartered Accountants Handbook – Accounting Part V – Pre-Changeover Standards.

The Organization plans to adopt Public Sector Accounting standards with the current NPO-specific standards, however has not yet determined the impact of this change on its financial reporting.

Other Employee Future Benefits

Acquisition of Capital Assets

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NOTES TO FINANCIAL STATEMENTSFor the year ended March 31, 2012

1. NATURE OF ORGANIZATIONTravel Manitoba was created as a Crown Corporation on April 1, 2005 under The Travel Manitoba Act as the culmination of extensive consultation and leadership from both the tourism industry and the provincial government. Travel Manitoba’s mission is to grow tourism revenues by harnessing the collective investment in tourism to create strong connections between visitors and Manitoba’s unique experiences. Travel Manitoba collaborates closely and in partnership with the tourism industry and governments to attract visitors to Manitoba, sustaining and creating jobs and businesses in the tourism sector in the province.

Travel Manitoba receives core funding from the Province of Manitoba to facilitate operations and to mobilize public and private resources to further foster the growth and professionalism of the tourism industry in Manitoba. Travel Manitoba is economically dependent on the Province of Manitoba, because it derives a significant portion of its revenue from the Province of Manitoba.

2. CASH AND SHORT-TERM DEPOSITSThe Organization invests all surplus cash into short-term deposits with the Province’s Treasury Division. These deposits are made up of 30, 60 and 90 day callable term deposits.

A dedicated account has been established to safeguard $100,000 for the Organization’s retirement allowance obligation and enhanced pension benefit costs. Interest earned will be retained in the account.

3. DUE FROM THE PROVINCE OF MANITOBAUpon inception on April 1, 2005, the Organization recorded accumulated severance pay benefits receivable and payable of $368,937 transferred from the Province of Manitoba for its employees. This receivable, or portion thereof, for the Organization, will be collected by the Organization as severance benefits are paid to employees on record as at April 1, 2005.

During the year, the Organization reduced the receivable from the government in the amount of $54,314 related to employees no longer employed by the Organization. The receivable from the Province of Manitoba as at March 31, 2012 is $150,413 ($204,727 in 2011).

4. CAPITAL ASSETS

2012 2011

Accumulated Accumulated Cost Amortization Cost Amortization

Computer hardware $ 36,734 $ 19,036 $ 27,825 $ 14,340 Computer software 29,503 27,850 29,503 26,161 Furniture and equipment 22,294 3,494 16,086 2,668 Leasehold improvements 111,644 18,762 111,644 13,874

$ 200,175 $ 69,142 $ 185,058 $ 57,043

Cost less accumulated amortization $ 131,033 $ 128,015$ , $ ,

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NOTES TO FINANCIAL STATEMENTSFor the year ended March 31, 2012

5. RETIREMENT ALLOWANCES AND OTHER BENEFITS PAYABLE

The Organization measures its accrued benefit obligation for each of the retirement allowance and enhanced pension benefits as at March 31 of each year. The most recent actuarial valuation report for the retirement allowance was at April 1, 2012 and the most recent finalized and approved actuarial valuation report for the enhanced pension benefits was at December 31, 2010.

The significant actuarial assumptions adopted in measuring the Organization’s retirement allowance obligation and costs are as follows:

2012 2011

Benefit costs for the year ended March 31 Discount rate 6.00% 6.00% Rate of compensation increase 2.75% 2.75% Employer contributions $ 161,103 $ 125,095

The significant actuarial assumptions adopted in measuring the Organization’s enhanced pension benefit and costs are as follows:

2012 2011

Benefit costs for the year ended March 31 Discount rate 6.00% 6.00% Rate of compensation increase 3.75% 3.75% Employer contributions $ 2,512 $ 1,425 Effect of change in assumptions $ - $ 4,203 Experience loss/(gain) adjustment $ - $ (25,134)

6. FINANCIAL INSTRUMENT RISK MANAGEMENT The Organization is exposed to different types of risk in the normal course of operations, including credit risk and market risk. The Organization’s objective in risk management is to optimize the risk return trade-off, within set limits, by applying integrated risk management and control strategies, policies and procedures throughout the Organization’s activities.

Credit Risk

Credit risk is the risk that one party to a financial instrument fails to discharge an obligation and causes financial loss to another party. Financial instruments which potentially subject the Organization to credit risk consist principally of accounts receivable.

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NOTES TO FINANCIAL STATEMENTSFor the year ended March 31, 2012

6. FINANCIAL INSTRUMENT RISK MANAGEMENT (CONTINUED)

The Organization’s maximum exposure to credit risk without taking account of any collateral or other credit enhancements is as follows:

2012 2011

Trade accounts receivable $ 621,892 $ 1,274,550Due from the Province of Manitoba 150,413 204,727

$ 772,305 $ 1,479,277

Trade amounts: The Organization is not exposed to significant credit risk as the receivable is spread among a broad client base and payment in full is typically collected when it is due. The Organization establishes an allowance for doubtful accounts that represents its estimate of potential credit losses. The allowance for doubtful accounts is based on management’s estimates and assumptions regarding current market conditions, customer analysis and historical payment trends. These factors are considered when determining whether past due accounts are allowed for or written off.

Other amounts receivable: The Organization is not exposed to significant credit risk as non-trade receivables are substantially all from provincial and federal governments.

Market Risk

Market risk is the risk the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, foreign exchange risk and other price risk.

Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. The Organization is not exposed to significant interest rate risk. Its short-term deposits are held in short-term or variable rate products.

The Organization is not exposed to significant foreign currency risk as it does not have any financial instruments denominated in foreign currency and the number of transactions in foreign currency are minimal and the Organization is not exposed to other price risk.

Fair Value

The carrying values of cash and short-term deposits, trade accounts receivable, due from the Province of Manitoba and accounts payable and accrued liabilities approximate their fair value due to the relatively short periods to maturity of these items or because they are receivable or payable on demand.

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NOTES TO FINANCIAL STATEMENTS

For the year ended March 31, 2012

7. CONTINGENCIES AND COMMITMENTS

The Organization has entered into lease agreements for rental of facilities at various locations with total annual payments of $609,608. In addition, the Organization leases computer equipment from the Province of Manitoba. The anticipated charge for the year ended March 31, 2013 is $13,978.

The Organization has access to a loan guarantee with the Province of Manitoba for $1,500,000. The guarantee will enable Travel Manitoba to establish a line of credit up to this amount for the purpose of providing advances and profit guarantees as part of bid proposals and preparation efforts being undertaken in attracting various events to take place in Manitoba. As at March 31, 2012, this line of credit had not been drawn upon.

8. NON-MONETARY TRANSACTIONS

During the current year, the Organization entered into contracts with exchanges of non-monetary services for other non-monetary services with little or no monetary consideration involved. These transactions are within normal business activities and were done in order to carry out the mandate of the Organization.

The Organization has used the fair value of the services that have been given up in order to measure the amount of the transaction as this is the more reliable and accurate measure of the revenue and expenses that have been incurred through these transactions. The aggregate amount of all non-monetary transactions in the current year total $42,581 ($41,827 in 2011).

The Organization has not incurred any gains or losses in the current year with respect to these non-monetary transactions.

9. CAPITAL MANAGEMENT

The Organization considers its capital to comprise its unrestricted net assets, restricted net assets for purchase of capital assets and its net assets investment in capital assets. There have been no changes to what the organization considers to be its capital since the previous period.

The Organization’s operations are reliant on revenues generated annually. The Organization has accumulated unrestricted net assets over its history. A portion of these accumulated funds is retained as working capital which may be required from time to time due to timing delays in receiving its primary funding. The remaining funds are available for the use of the Organization at the Board of Directors’ discretion.

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TRAVEL MANITOBA 7th floor – 155 Carlton St. Winnipeg, Manitoba R3C 3H8 1-800-665-0040www.travelmanitoba.com