West (WSTC) 8-K Other Events

Exhibit 99.1

ITEM 6. SELECTED FINANCIAL DATA

The following table sets forth a summary of our selected consolidated financial data. We derived the selected consolidated financial data as of December 31, 2008 and December 31, 2007 and for the years ended December 31, 2008, December 31, 2007, and December 31, 2006 from our audited consolidated financial statements included elsewhere in this annual report. The selected consolidated financial data as of December 31, 2006, December 31, 2005, and December 31, 2004, and for the years ended December 31, 2005 and December 31, 2004 have been derived from our financial statements for such years, which are not included in this annual report. On January 1, 2009, we adopted Statement of Financial Accounting Standards No. 160Noncontrolling Interests in Consolidated Financial Statements—An Amendment of ARB No. 51, which required retrospective application and accordingly all prior periods have been recast to reflect the retrospective adoption.

The selected consolidated financial data set forth below are not necessarily indicative of the results of future operations and should be read in conjunction with the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the other financial information included elsewhere in this annual report.

	Year Ended December 31,
	2004			2005			2006			2007			2008
Statement of Operations Data: (amounts in thousands, except per share amounts)
Revenue	$	1,217,383		$	1,523,923		$	1,856,038		$	2,099,492		$	2,247,434
Cost of services		541,979			687,381			818,522			912,389			1,015,028
Selling, general and administrative expenses (“SG&A”)(1)		487,513			569,865			800,301			840,532			881,586
Operating income		187,891			266,677			237,215			346,571			350,820
Interest expense		(9,381	)		(15,358	)		(94,804	)		(332,372	)		(313,019	)
Other income (expense)		3,013			2,177			8,144			13,396			(8,621	)
Income before income tax expense and noncontrolling interest		181,523			253,496			150,555			27,595			29,180
Income tax expense		65,762			87,736			65,505			6,814			11,731
Net income		115,761			165,760			85,050			20,781			17,449
Less net income (loss)—noncontrolling interest		2,590			15,411			16,287			15,399			(2,058	)
Net income—West Corporation	$	113,171		$	150,349		$	68,763		$	5,382		$	19,507
Earnings (loss) per share:
Basic	$	1.67		$	2.18
Diluted	$	1.63		$	2.11
Basic L shares							$	2.05		$	11.08		$	12.78
Diluted L shares							$	1.98		$	10.68		$	12.24
Basic A shares							$	0.66		$	(1.20	)	$	(1.23	)
Diluted A shares							$	0.64		$	(1.20	)	$	(1.23	)

	Year Ended December 31,
	2004			2005			2006			2007			2008
Selected Other Data: (amounts in thousands)
Net cash flows from operating activities	$	218,560		$	290,004		$	215,739		$	263,897		$	287,381
Net cash flows used in investing activities	$	(260,743	)	$	(297,154	)	$	(812,253	)	$	(454,946	)	$	(597,539	)
Net cash flows from financing activities	$	47,083		$	9,507		$	780,742		$	118,106		$	341,971

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	Year Ended December 31,
	2004			2005			2006			2007			2008
Capital expenditures	$	59,886		$	76,855		$	113,895		$	103,647		$	105,381
Adjusted EBITDA(2)	$	291,003		$	381,623		$	501,942		$	584,123		$	633,551
Adjusted EBITDA margin(3)		23.9	%		25.0	%		27.0	%		27.8	%		28.2	%

	As of December 31,
	2004		2005		2006			2007			2008
Balance Sheet Data: (amounts in thousands)
Working capital	$	124,766	$	110,047	$	128,570		$	187,795		$	211,410
Property and equipment, net	$	223,110	$	234,871	$	294,707		$	298,645		$	320,152
Total assets	$	1,271,206	$	1,498,662	$	2,535,856		$	2,846,490		$	3,314,789
Total debt	$	258,498	$	260,520	$	3,287,246		$	3,596,691		$	3,946,127
Class L common stock	$	—	$	—	$	903,656		$	1,029,782		$	1,158,159
Stockholders’ equity (deficit)	$	801,595	$	987,177	$	(2,117,255	)	$	(2,227,198	)	$	(2,360,747	)

(1) Includes stock based compensation of $483, $538, $28,738, $1,276 and $1,404 for the years ended December 31, 2004, 2005, 2006, 2007 and 2008, respectively.

(2) The term “EBITDA” refers to earnings before interest expense, taxes, depreciation and amortization, and the term “Adjusted EBITDA” refers to earnings before interest expense, share based compensation, taxes, depreciation and amortization, non-recurring litigation settlement costs, impairments and other non-cash reserves, transaction costs and after-acquisition synergies. We present Adjusted EBITDA because our management team uses it as an important supplemental measure in evaluating our operating performance and preparing internal forecasts and budgets and we believe it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry. We also use Adjusted EBITDA as a liquidity measure in assessing compliance with our senior credit facilities. For a reconciliation of Adjusted EBITDA to cash flows from operating activities and a description of the material covenants contained in our senior credit facilities, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Debt Covenants.” We believe that the presentation of Adjusted EBITDA is useful because it provides important insight into our profitability trends and allows management and investors to analyze operating results with and without the impact of certain non-cash charges, such as depreciation and amortization, share-based compensation and impairments and other non-cash reserves, as well as certain litigation settlement and transaction costs and after-acquisition synergies. Although we use Adjusted EBITDA as a financial measure to assess the performance of our business and a measure of our liquidity, Adjusted EBITDA is not a measure of financial performance or liquidity under generally accepted accounting principles (“GAAP”) and the use of Adjusted EBITDA is limited because it does not include certain material costs, such as depreciation, amortization and interest, necessary to operate our business and includes adjustments for synergies that have not been realized. In addition, as disclosed below, certain adjustments included in our calculation of Adjusted EBITDA are based on management’s estimates and do not reflect actual results. For example, post-acquisition synergies included in Adjusted EBITDA are determined in accordance with our senior credit facilities, which provide for an adjustment to EBITDA, subject to certain specified limitations, for reasonably identifiable and factually supportable cost savings projected by us in good faith to be realized as a result of actions taken following an acquisition. While we use net income as a measure of performance, we also believe that Adjusted EBITDA, when presented along with net income, provides balanced disclosure which, for the reasons set forth above, is useful to investors and management in evaluating our operating performance and profitability. Adjusted EBITDA included in this annual report should be considered in addition to, and not as a substitute for, net income (loss) as calculated in accordance with GAAP as a measure of performance. Adjusted EBITDA, as presented, may not be comparable to similarly titled measures of other companies. Set forth below is a reconciliation of EBITDA and Adjusted EBITDA to net income.

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	For the year ended December 31,
	2004		2005		2006		2007		2008
(amounts in thousands):
Net income	$	115,761	$	165,760	$	85,050	$	20,781	$	17,449
Interest expense		8,165		14,500		94,803		332,372		313,019
Depreciation and amortization		100,185		110,339		136,979		182,820		183,487
Income tax expense		65,762		87,736		65,505		6,814		11,731
EBITDA		289,873		378,335		382,337		542,787		525,686
Provision for share-based compensation(a)		—		538		28,738		1,276		1,404
Acquisition synergies and transaction costs(b)		—		1,365		89,562		22,006		20,985
Non-cash portfolio impairments(c)		—		—		—		1,004		76,405
Site closure and other impairments(d)		—		—		—		1,309		2,644
Non-cash foreign currency (gain) loss(e)		—		—		—		—		6,427
Non-recurring litigation settlement costs(f)		—		—		—		15,741		—
Synthetic lease interest(g)		1,130		1,385		1,305		—		—
Adjusted EBITDA(h)	$	291,003	$	381,623	$	501,942	$	584,123	$	633,551

(a) Represents total share based compensation expense determined at fair value in accordance with SFAS No. 123 (revised 2004), “Share-Based Payment” (“SFAS 123R”).

(b) Represents, for each period presented, unrealized synergies for acquisitions, consisting primarily of headcount reductions and telephony-related savings, direct acquisition expenses, transaction costs incurred with the recapitalization and the exclusion of the negative EBITDA in one acquired entity, which was an unrestricted subsidiary under the indentures governing our outstanding notes. Amounts shown are permitted to be added to “EBITDA” for purposes of calculating our compliance with certain covenants under our credit facility and the indentures governing our outstanding notes.

(c) Represents non-cash portfolio receivable allowances.

(d) Represents site closures and other asset impairments.

(e) Represents the unrealized loss on foreign denominated debt and the loss on transactions with affiliates denominated in foreign currencies.

(f) Class action litigation settlement, net of estimated insurance proceeds, and related legal costs.

(g) Represents interest incurred on a synthetic building lease, which was purchased in September 2006.

(h) Adjusted EBITDA does not include pro forma adjustments for acquired entities of $49.1 million in 2008 and $9.1 million in 2007 as is permitted in the debt covenants.

(3) Represents Adjusted EBITDA as a percentage of revenue.

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