Exhibit 99.1
Premiere Global Services Reports First Quarter 2010 Results:
Revenues $146.4M, Non-GAAP Diluted EPS from Continuing Operations $0.19*
Company Reaffirms Financial Outlook for 2010
ATLANTA--(BUSINESS WIRE)--April 22, 2010--Premiere Global Services, Inc. (NYSE: PGI), a leading provider of meeting and collaboration solutions, today announced results for the first quarter ended March 31, 2010.
Consolidated net revenues totaled $146.4 million in the first quarter of 2010, including $112.5 million from the Company’s PGiMeet solutions. In the first quarter of 2010, diluted EPS from continuing operations was $0.13, and non-GAAP diluted EPS from continuing operations was $0.19.*
In the first quarter of 2009, consolidated net revenues totaled $155.1 million, including $117.9 million from the Company’s PGiMeet solutions. In the first quarter of 2009, diluted EPS from continuing operations was $0.19, and non-GAAP diluted EPS from continuing operations was $0.27.* Results for the first quarter of 2009 are adjusted to reflect the Company’s PGiMarket email marketing business as discontinued operations.
“Our business trends continue to show signs of improvement, despite ongoing economic pressures,” said Boland T. Jones, Founder, Chairman and CEO of Premiere Global Services, Inc. “We are continuing to close a healthy number of new deals, we have a solid pipeline of new business opportunities, and we remain optimistic in our outlook for the year ahead.
“We are excited about the upcoming release of our innovative new meeting platform, iMeet®, which we designed to provide the most intuitive and engaging user experience in the market today. Our focus on usability, which is the hallmark of iMeet, will also be apparent throughout our entire collaboration suite this year, which will enable our customers to meet and collaborate in more powerful, productive and simpler ways than ever before.”
2010 Financial Outlook
The following statements are based on PGi’s current expectations. These statements contain forward-looking statements and Company estimates, and actual results may differ materially. The Company assumes no duty to update any forward-looking statements made in this press release.
Based on current trends and foreign currency exchange rates, the Company continues to anticipate consolidated net revenues will be in the range of $585-$600 million and non-GAAP diluted EPS from continuing operations will be in the range of $0.72-$0.75* in 2010. The Company anticipates marketing and advertising costs associated with the launch of its new iMeet collaboration platform, included in the range provided, will be concentrated in the third and fourth quarters of 2010.
The Company will host a conference call this afternoon at 5:00 p.m., Eastern Time, to discuss these results. To participate in the call, please dial-in to the appropriate number 5-10 minutes prior to the scheduled start time: (888) 684-1265 (U.S. and Canada) or (913) 312-1483 (International). The conference call will simultaneously be webcast. Please visit www.pgi.com for webcast details, as well as the webcast archive, replay details and the text of the earnings release, including the financial and statistical information to be presented during the call.
* Non-GAAP Financial Measures
To supplement the Company’s consolidated financial statements presented in accordance with GAAP, we have included the following non-GAAP measures of financial performance: non-GAAP operating income, non-GAAP net income from continuing operations, non-GAAP diluted net income per share (EPS) from continuing operations and organic growth. The Company has also included these non-GAAP measures, as well as consolidated net revenues, segment net revenues and certain solutions revenue, on a constant currency basis. Management uses these measures internally as a means of analyzing the Company’s current and future financial performance and identifying trends in our financial condition and results of operations. We have provided this information to investors to assist in meaningful comparisons of past, present and future operating results and to assist in highlighting the results of ongoing core operations. Please see the table attached for calculation of these non-GAAP financial measures and for reconciliation to the most directly comparable GAAP measures. These non-GAAP financial measures may differ materially from comparable or similarly titled measures provided by other companies and should be considered in addition to, not as a substitute for or superior to, measures of financial performance prepared in accordance with GAAP.
About Premiere Global Services, Inc. │ PGi
The world collaborates with PGi. Our advanced meeting, conferencing and collaboration solutions energize people and organizations to connect more meaningfully and work together more productively. Our customers include more than 50,000 companies and nearly 90% of the Fortune 500. Every month, 12 million people around the world use PGi’s advanced solutions and next-generation platform to meet, work and collaborate. PGi is headquartered in Atlanta, Georgia with operations in 24 countries worldwide. You can learn more at www.pgi.com.
Statements made in this press release, other than those concerning historical information, should be considered forward-looking and subject to various risks and uncertainties. Such forward-looking statements are made pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 and are made based on management’s current expectations or beliefs as well as assumptions made by, and information currently available to, management. A variety of factors could cause actual results to differ materially from those anticipated in Premiere Global Services, Inc.’s forward-looking statements, including, but not limited to, the following factors: competitive pressures, including pricing pressures; technological changes; the development of alternatives to our services; general domestic and international economic, business or political conditions; global economic and credit conditions, including customer consolidations, restructuring, bankruptcies or payment defaults; market acceptance of our new products, services and enhancements; our ability to complete acquisitions and successfully integrate acquired operations; concerns regarding the security of sending information over the Internet and public networks; our ability to upgrade our equipment or increase our network capacity; service interruptions; continued weakness in our legacy broadcast fax business; our dependence on telecommunications supply agreements; increased financial leverage; our dependence on our subsidiaries for cash flow; future write-downs of goodwill or other intangible assets; assessments of income, sales and other taxes for which we have not accrued; our ability to attract and retain key personnel; our ability to protect our proprietary technology and intellectual property rights; possible adverse results of pending or future litigation or infringement claims; federal, state or international legislative or regulatory changes, including further government regulations applicable to traditional telecommunications service providers; risks associated with international operations and fluctuations in currency exchange rates; changes in and the successful execution of restructuring and cost reduction initiatives and the market reaction thereto and other factors described from time to time in our press releases, reports and other filings with the SEC, including but not limited to the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2009. All forward-looking statements attributable to us or a person acting on our behalf are expressly qualified in their entirety by this cautionary statement.
| PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES | |||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||
| (in thousands, except per share data) | |||||||||||
| Three Months Ended | |||||||||||
| March 31, | |||||||||||
| 2010 | 2009 | ||||||||||
| (Unaudited) | |||||||||||
| Net revenues | $ | 146,405 | $ | 155,082 | |||||||
| Operating expenses: | |||||||||||
| Cost of revenues (exclusive of depreciation and amortization shown | |||||||||||
| separately below) | 60,557 | 65,370 | |||||||||
| Selling and marketing | 38,404 | 36,988 | |||||||||
| General and administrative (exclusive of expenses | |||||||||||
| shown separately below) | 16,456 | 15,551 | |||||||||
| Research and development | 4,927 | 3,878 | |||||||||
| Depreciation | 9,880 | 8,631 | |||||||||
| Amortization | 2,261 | 2,980 | |||||||||
| Restructuring costs | - | 1,594 | |||||||||
| Asset impairments | 55 | - | |||||||||
| Net legal settlements and related expenses | 148 | - | |||||||||
| Acquisition-related costs | 174 | 340 | |||||||||
| Total operating expenses | 132,862 | 135,332 | |||||||||
| Operating income | 13,543 | 19,750 | |||||||||
| Other (expense) income: | |||||||||||
| Interest expense | (2,831 | ) | (4,025 | ) | |||||||
| Unrealized gain on change in fair value of interest rate swaps | 484 | 941 | |||||||||
| Interest income | 35 | 106 | |||||||||
| Other, net | (96 | ) | 62 | ||||||||
| Total other expense | (2,408 | ) | (2,916 | ) | |||||||
| Income from continuing operations before income taxes | 11,135 | 16,834 | |||||||||
| Income tax expense | 3,563 | 5,519 | |||||||||
| Net income from continuing operations | 7,572 | 11,315 | |||||||||
| Loss on discontinued operations, net of taxes | - | (1,091 | ) | ||||||||
| Net income | $ | 7,572 | $ | 10,224 | |||||||
| BASIC WEIGHTED-AVERAGE SHARES OUTSTANDING | 58,220 | 58,815 | |||||||||
| Basic net income (loss) per share | |||||||||||
| Continuing operations | $ | 0.13 | $ | 0.19 | |||||||
| Discontinued operations | - | (0.02 | ) | ||||||||
| Net income per share | $ | 0.13 | $ | 0.17 | |||||||
| DILUTED WEIGHTED-AVERAGE SHARES OUTSTANDING | 58,535 | 59,347 | |||||||||
| Diluted net income (loss) per share | |||||||||||
| Continuing operations | $ | 0.13 | $ | 0.19 | |||||||
| Discontinued operations | - | (0.02 | ) | ||||||||
| Net income per share | $ | 0.13 | $ | 0.17 | |||||||
| PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES | ||||||||||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||||
| (in thousands, except share data) | ||||||||||
| March 31, | December 31, | |||||||||
| 2010 | 2009 | |||||||||
| (Unaudited) | ||||||||||
| ASSETS | ||||||||||
| CURRENT ASSETS | ||||||||||
| Cash and equivalents | $ | 41,471 | $ | 41,402 | ||||||
| Accounts receivable (less allowances of $1,638 and $1,702, respectively) | 97,595 | 89,906 | ||||||||
| Prepaid expenses and other current assets | 11,790 | 10,735 | ||||||||
| Deferred income taxes, net | 7,030 | 7,261 | ||||||||
| Total current assets | 157,886 | 149,304 | ||||||||
| PROPERTY AND EQUIPMENT, NET | 137,370 | 137,235 | ||||||||
| OTHER ASSETS | ||||||||||
| Goodwill | 353,362 | 354,609 | ||||||||
| Intangibles, net of amortization | 22,424 | 24,840 | ||||||||
| Deferred income taxes, net | 2,569 | 2,703 | ||||||||
| Restricted cash | 106 | 103 | ||||||||
| Other assets | 9,106 | 9,432 | ||||||||
| TOTAL ASSETS | $ | 682,823 | $ | 678,226 | ||||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||
| CURRENT LIABILITIES | ||||||||||
| Accounts payable | $ | 50,080 | $ | 51,502 | ||||||
| Income taxes payable | 5,651 | 4,507 | ||||||||
| Accrued taxes, other than income taxes | 8,152 | 6,947 | ||||||||
| Accrued expenses | 27,409 | 28,543 | ||||||||
| Current maturities of long-term debt and capital lease obligations | 4,324 | 3,596 | ||||||||
| Accrued restructuring costs | 6,033 | 7,765 | ||||||||
| Total current liabilities | 101,649 | 102,860 | ||||||||
| LONG-TERM LIABILITIES | ||||||||||
| Long-term debt and capital lease obligations | 264,478 | 262,927 | ||||||||
| Accrued restructuring costs | 3,622 | 5,392 | ||||||||
| Accrued expenses | 17,369 | 17,133 | ||||||||
| Deferred income taxes, net | 7,677 | 8,872 | ||||||||
| Total long-term liabilities | 293,146 | 294,324 | ||||||||
| SHAREHOLDERS' EQUITY | ||||||||||
| Common stock, $0.01 par value; 150,000,000 shares authorized, | ||||||||||
| 60,022,737 and 59,392,311 shares issued and outstanding, respectively | 600 | 594 | ||||||||
| Additional paid-in capital | 546,973 | 544,896 | ||||||||
| Notes receivable, shareholder | (1,841 | ) | (1,814 | ) | ||||||
| Accumulated other comprehensive gain | 3,575 | 6,217 | ||||||||
| Accumulated deficit | (261,279 | ) | (268,851 | ) | ||||||
| Total shareholders' equity | 288,028 | 281,042 | ||||||||
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 682,823 | $ | 678,226 | ||||||
| PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES | ||||||||||||||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||
| (in thousands) | ||||||||||||||
| Three Months Ended | ||||||||||||||
| March 31, | ||||||||||||||
| 2010 | 2009 | |||||||||||||
| (Unaudited) | ||||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | 7,572 | $ | 10,224 | ||||||||||
| Loss from discontinued operations, net of taxes | - | 1,091 | ||||||||||||
| Income from continuing operations | 7,572 | 11,315 | ||||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
| Depreciation | 9,880 | 8,631 | ||||||||||||
| Amortization | 2,261 | 2,980 | ||||||||||||
| Amortization of deferred financing costs | 159 | 141 | ||||||||||||
| Net legal settlements and related expenses | 148 | - | ||||||||||||
| Payments for legal settlements and related expenses | (127 | ) | - | |||||||||||
| Deferred income taxes, net of effect of acquisitions | (925 | ) | (783 | ) | ||||||||||
| Restructuring costs | - | 1,594 | ||||||||||||
| Payments for restructuring costs | (3,588 | ) | (726 | ) | ||||||||||
| Asset impairments | 55 | - | ||||||||||||
| Equity-based compensation | 2,707 | 2,936 | ||||||||||||
| Excess tax benefits from share-based payment arrangements | (2 | ) | (126 | ) | ||||||||||
| Unrealized gain on change in fair value of interest rate swaps | (484 | ) | (941 | ) | ||||||||||
| Provision for doubtful accounts | 319 | 118 | ||||||||||||
| Changes in working capital | (5,894 | ) | (5,272 | ) | ||||||||||
| Net cash provided by operating activities from continuing operations | 12,081 | 19,867 | ||||||||||||
| Net cash used in operating activities from discontinued operations | - | (1,222 | ) | |||||||||||
| Net cash provided by operating activities | 12,081 | 18,645 | ||||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||||||
| Capital expenditures | (9,204 | ) | (11,671 | ) | ||||||||||
| Business acquisitions, net of cash acquired | (246 | ) | (7,484 | ) | ||||||||||
| Net cash used in investing activities from continuing operations | (9,450 | ) | (19,155 | ) | ||||||||||
| Net cash used in investing activities from discontinued operations | - | (900 | ) | |||||||||||
| Net cash used investing activities | (9,450 | ) | (20,055 | ) | ||||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||||||
| Principal payments under borrowing arrangements | (36,294 | ) | (56,848 | ) | ||||||||||
| Proceeds from borrowing arrangements | 35,044 | 64,445 | ||||||||||||
| Excess tax benefits from share-based payment arrangements | 2 | 126 | ||||||||||||
| Purchase of treasury stock, at cost | (554 | ) | (3,391 | ) | ||||||||||
| Exercise of stock options | - | 307 | ||||||||||||
| Net cash (used in) provided by financing activities | (1,802 | ) | 4,639 | |||||||||||
| Effect of exchange rate changes on cash and equivalents | (760 | ) | (989 | ) | ||||||||||
| NET INCREASE IN CASH AND EQUIVALENTS | 69 | 2,240 | ||||||||||||
| CASH AND EQUIVALENTS, beginning of period | 41,402 | 27,535 | ||||||||||||
| CASH AND EQUIVALENTS, end of period | $ | 41,471 | $ | 29,775 | ||||||||||
| PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES | |||||||||||
| RECONCILIATION OF NON-GAAP FINANCIAL MEASURES | |||||||||||
| (in thousands, except per share data) | |||||||||||
| Three Months Ended | |||||||||||
| March 31, | |||||||||||
| 2010 | 2009 | ||||||||||
| (Unaudited) | |||||||||||
| Non-GAAP Operating Income (1) | |||||||||||
| Operating income, as reported | $ | 13,543 | $ | 19,750 | |||||||
| Restructuring costs | - | 1,594 | |||||||||
| Asset impairments | 55 | - | |||||||||
| Net legal settlements and related expenses | 148 | - | |||||||||
| Equity-based compensation | 2,707 | 2,936 | |||||||||
| Acquisition-related costs | 174 | 340 | |||||||||
| Amortization | 2,261 | 2,980 | |||||||||
| Non-GAAP operating income | $ | 18,888 | $ | 27,600 | |||||||
| Non-GAAP Net Income from Continuing Operations (1) | |||||||||||
| Net income from continuing operations, as reported | $ | 7,572 | $ | 11,315 | |||||||
| Unrealized gain on change in fair value of interest rate swaps | (329 | ) | (612 | ) | |||||||
| Restructuring costs | - | 1,079 | |||||||||
| Asset impairments | 37 | - | |||||||||
| Net legal settlements and related expenses | 101 | - | |||||||||
| Equity-based compensation | 1,841 | 1,988 | |||||||||
| Acquisition-related costs | 118 | 230 | |||||||||
| Amortization | 1,537 | 2,017 | |||||||||
| Non-GAAP net income from continuing operations | $ | 10,877 | $ | 16,017 | |||||||
| Non-GAAP Diluted EPS from Continuing Operations (1) | |||||||||||
| Diluted net income per share from continuing operations, as reported | $ | 0.13 | $ | 0.19 | |||||||
| Unrealized gain on change in fair value of interest rate swaps | (0.01 | ) | (0.01 | ) | |||||||
| Restructuring costs | - | 0.02 | |||||||||
| Asset impairments | 0.00 | - | |||||||||
| Net legal settlements and related expenses | 0.00 | - | |||||||||
| Equity-based compensation | 0.03 | 0.03 | |||||||||
| Acquisition-related costs | 0.00 | 0.00 | |||||||||
| Amortization | 0.03 | 0.03 | |||||||||
| Non-GAAP diluted EPS from continuing operations | $ | 0.19 | $ | 0.27 | |||||||
| (1) | Management believes that presenting non-GAAP operating income, non-GAAP net income from continuing operations and non-GAAP diluted EPS from continuing operations provide useful information regarding underlying trends in our continuing operations. Management expects equity-based compensation and amortization expenses to be recurring costs and presents non-GAAP diluted EPS from continuing operations to exclude these non-cash items as well as non-recurring items that are unrelated to our ongoing operations, including unrealized gain on change in fair value of interest rate swaps, restructuring costs, asset impairments, net legal settlements and related expenses, and acquisition-related costs. These non-cash and non-recurring items are presented net of taxes for non-GAAP net income from continuing operations and non-GAAP diluted EPS from continuing operations. | ||||||||||
| PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES | ||||||||||||||||||||||||
| RECONCILIATION OF NON-GAAP | ||||||||||||||||||||||||
| CONSTANT CURRENCY ADJUSTMENTS AND ORGANIC GROWTH | ||||||||||||||||||||||||
| Constant Currency Adjustments (2) | ||||||||||||||||||||||||
| Impact of fluctuations | ||||||||||||||||||||||||
| Q1 - 10 | in foreign currency | Q1 - 10 | ||||||||||||||||||||||
| (Constant currency) | exchange rates | (Actual) | ||||||||||||||||||||||
| (Unaudited, in thousands, except per share data) | ||||||||||||||||||||||||
| Consolidated Net Revenues | $ | 141,580 | $ | 4,825 | $ | 146,405 | ||||||||||||||||||
| North America Net Revenue | $ | 89,597 | $ | 658 | $ | 90,255 | ||||||||||||||||||
| Europe Net Revenue | $ | 27,295 | $ | 1,718 | $ | 29,013 | ||||||||||||||||||
| Asia Pacific Net Revenue | $ | 24,688 | $ | 2,449 | $ | 27,137 | ||||||||||||||||||
| PGiMeet Solutions Revenue | $ | 109,166 | $ | 3,328 | $ | 112,494 | ||||||||||||||||||
| Non-GAAP Operating Income | $ | 17,802 | $ | 1,086 | $ | 18,888 | ||||||||||||||||||
| Non-GAAP Net Income from Continuing Operations | $ | 10,247 | $ | 630 | $ | 10,877 | ||||||||||||||||||
| Non-GAAP Diluted EPS from Continuing Operations | $ | 0.18 | $ | 0.01 | $ | 0.19 | ||||||||||||||||||
| (2) | Management also presents these non-GAAP financial measures, as well as consolidated net revenues, segment net revenue and certain solutions revenue, on a constant currency basis to exclude the effects of foreign currency exchange rates, which are not completely within management's control, in order to facilitate period-to-period comparison of our financial results without the distortion of these fluctuations. These constant currency adjustments exclude any fluctuations in foreign currency exchange rates using the average exchange rates from the current year period and applying them to prior period results. | |||||||||||||||||||||||
| Organic Growth (3) | ||||||||||||||||||||||||
| Impact of fluctuations | Organic | Organic net | ||||||||||||||||||||||
| March 31, | in foreign currency | Impact of | net revenue | March 31, | revenue | |||||||||||||||||||
| 2009 | exchange rates | acquisitions | growth | 2010 | growth rate | |||||||||||||||||||
| (Unaudited, in thousands, except percentages) | ||||||||||||||||||||||||
| Consolidated Net Revenues, Three Months Ended | $ | 155,082 | $ | 4,825 | $ | 346 | $ | (13,848 | ) | $ | 146,405 | -8.9 | % | |||||||||||
| PGiMeet Solutions Revenue, Three Months Ended | $ | 117,860 | $ | 3,328 | $ | 346 | $ | (9,040 | ) | $ | 112,494 | -7.7 | % | |||||||||||
| (3) | Management defines "organic growth" as revenue changes excluding the impact of foreign currency exchange rate fluctuations and acquisitions made during the periods presented and presents this non-GAAP financial measure to exclude the effect of these items that are not completely within management's control, such as foreign currency exchange rate fluctuations, or do not reflect our ongoing core operations or underlying growth, such as acquisitions. | |||||||||||||||||||||||
CONTACT:
Premiere Global Services, Inc.
Investor Calls
Sean O’Brien, 404-262-8462
Senior Vice President
Strategic Planning & IR