[LOGO] VIALOG(R)
The Conferencing Company
AT THE COMPANY: AT THE FINANCIAL RELATIONS BOARD/BSMG WORLDWIDE:
MICHAEL E. SAVAGE MARILYN WINDSOR DOUG BRODERICK TIM GRACE
CHIEF FINANCIAL OFFICER GENERAL INQUIRIES ANALYST INQUIRIES MEDIA INQUIRIES
(781) 761-6200 (312) 640-6692 (312) 274-2266 (312) 274-2240
FOR IMMEDIATE RELEASE
MONDAY, MARCH 5, 2001
VIALOG REPORTS RECORD RESULTS FOR FOURTH QUARTER, FULL YEAR 2000;
JANUARY 2001 YEAR-OVER-YEAR REVENUE GROWTH 27%,
GROSS MARGIN 59.6%, EBITDA MARGIN 29.6%
RAPID ADOPTION OF AUTOMATED SERVICES BOOSTS GROWTH AND MARGINS
HIGHLIGHTS:
o JANUARY 2001 REVENUE UP 27% OVER PAST YEAR; GROSS MARGIN UP TO 59.6%
o JANUARY 2001 EBITDA MARGIN 29.6%
o CALL VOLUMES UP 39% IN 4Q; 65% IN JANUARY
o READY-TO-MEET NOW $18M ANNUAL RUN RATE
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SUMMARY OF CONSOLIDATED OPERATIONS
THREE MONTHS ENDED TWELVE MONTHS ENDED JANUARY
DECEMBER 31, DECEMBER 31,
----------------------------- -------------------------------- -----------------------------
2000 1999 2000 1999 2001 2000
---- ---- ---- ---- ---- ----
(UNAUDITED) (UNAUDITED)
NET REVENUES $ 19,800 $ 17,714 $ 77,587 $ 68,629 $7,704 $ 6,068
OPERATING INCOME 257 770 5,373 1,568 1,410 600
NET INCOME (LOSS) (3,147) (2,717) (9,156) (12,120) 166 (554)
EPS (0.32) (0.30) (0.97) (1.53) 0.02 (0.06)
EBITDA 3,728 * 3,186 17,674 ** 13,989 *** 2,278 1,354
<FN>
* EXCLUDES $1.0 MILLION IN TELECOM AND ACCOUNTS RECEIVABLE RESERVE ADJUSTMENTS
** EXCLUDES $1.0 MILLION IN ADJUSTMENTS NOTED ABOVE AND $1.7 MILLION WRITEOFF OF DEBT REFINANCING COSTS
*** EXCLUDES $4.2 MILLION RESTRUCTURING AND SEVERANCE CHARGES
</FN>
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BEDFORD, MASS., MARCH 5, 2001--VIALOG CORPORATION (AMEX: VX), a leading provider
of audio, video and Internet conferencing services, today announced record
results for the fourth quarter and year ended December 31, 2000, as well as for
January 2001. Increased call volume, a strong shift towards automated products,
and continued penetration of the company's targeted Fortune 2500 companies drove
the results.
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POWER OF AUTOMATION DRIVING RESULTS
"We're pleased with our record results for the fourth quarter of the year, and
very excited about our prospects for 2001 based upon an exceptional performance
in January," said Kim Mayyasi, Vialog's president and chief executive officer.
"In barely over a year, automated services, including Ready-To-Meet, have grown
to over one-third of our total traffic. This is a high-growth, high-margin
business that now has an $18M annual revenue run rate."
JANUARY RESULTS REFLECT BOOSTED PROFITABILITY FROM AUTOMATION
Mayyasi continued, "Our January results are clearly the best way to illustrate
how automation is driving our business. Our monthly revenues grew 27 percent
over last January to $7.7 million, with most of the growth coming from
Ready-To-Meet. The increased margins are more impressive. Gross margin was 59.6
percent compared with a gross margin of 52.9 percent in January 2000, and the
operating margin was 18.3 percent compared with 9.9 percent last year. Earnings
before interest, taxes, depreciation and amortization (EBITDA) was $2.3 million,
resulting in an EBITDA margin of 29.6 percent, compared with $1.4 million, or an
EBITDA margin of 22.3 percent for January 2000."
AUTOMATION SIGNIFICANTLY IMPACTS FOURTH QUARTER
Net revenues increased 12 percent to a record $19.8 million from $17.7 million
in last year's fourth quarter. The revenue growth resulted from continued
penetration of Vialog's existing customer base and winning new customers within
its Fortune 2500 target market. Of these companies, nearly one-third are Vialog
customers. Strong demand for the company's Ready-To-Meet automated audio service
drove a 14 percent increase in call volumes from the third quarter.
Reported gross margin was 53.7 percent, which is consistent with the gross
margin in the comparable period last year. Reported gross margin includes
$357,000 of additional telecom costs related to a change in prior estimates for
telecom rate changes and other telecom charges.
Mayyasi noted that the gross margins were down from the record 58.0 percent
posted in the 2000 third quarter. "Interestingly, Ready-To-Meet, which has been
instrumental in enhancing our margins in January, was the cause of a temporary
decrease during the fourth quarter," he said. "We saw traffic migrate from
operator-assisted and operator-reserved calls to Ready-To-Meet much faster than
forecast. This resulted in our operations centers being temporarily overstaffed
during the fourth quarter. We identified the issue and adjusted accordingly,
helping to produce the 59.6 percent gross margin in January."
Operating margin was 1.3 percent versus 4.3 percent in the comparable 1999
period. EBITDA was $2.8 million compared with $3.2 million for the same period
last year. Reported EBITDA includes the $357,000 telecom adjustment noted above,
as well as a non-cash charge of $600,000 to increase the accounts receivable
reserve. The net loss was $3.1 million, or $0.32 per share.
RECORD YEAR FOR 2000
For the year, revenues increased 13 percent to $77.6 million from $68.6 million
in 1999. Reported gross margin improved to 55.8 percent, a 300-basis-point
increase, and the operating margin was 9.1 percent compared with 8.4 percent.
EBITDA was $16.7 million versus $14.0 million for the comparable period last
year, a 19 percent increase. The operating margin and EBITDA for 2000 exclude
the $1.7 million writeoff of debt refinancing costs that Vialog took in the
third quarter when refinancing was discontinued as part of the Genesys
Conferencing merger agreement. The operating margin and EBITDA for 1999
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exclude $4.2 million in restructuring and severance charges. The net loss was
$9.2 million, or $0.97 per share, compared with a loss of $12.1 million, or
$1.53 per share in 1999.
"The strategic plan that Vialog's management put in place 18 months ago is
paying off in expanded margins and increased profitability," Mayyasi said. "This
is evident in our gross margin, which is growing faster than the rate of our
revenues."
GENESYS CONFERENCING ACQUISITION
On October 1, 2000, Vialog reached an agreement to be acquired by Genesys
Conferencing, the largest independent conferencing company in Europe and
Asia-Pacific. The acquisition, which will create the world's largest independent
conferencing specialist, is subject to, among other things, the approval of
Vialog shareholders, the approval of issuance of new Genesys Conferencing shares
by Genesys Conferencing shareholders, the refinancing of Vialog's debt, and the
listing of Genesys Conferencing American Depositary Shares (ADSs) on the Nasdaq
stock market. Both companies have scheduled shareholders' meetings for March 23,
2001.
FOURTH QUARTER CONFERENCE CALL
The company will hold a conference call to discuss the fourth-quarter 2000 and
January 2001 results on Monday, March 5, at 11:00 a.m. EST. To hear the
company's conference call and view presentation charts, please log on to
www.vialog.com and follow the instructions. Replay will be available on the same
site.
ABOUT VIALOG
Headquartered in Bedford, Mass., Vialog is a leading provider of
teleconferencing and messaging services, including audioconferencing,
videoconferencing, web conferencing, voicemail broadcast, email broadcast and
fax broadcast. Vialog helps its more than 6,000 corporate customers communicate
more professionally, efficiently and effectively by delivering superior customer
service and an extensive range of enhanced and customized conferencing
solutions. Vialog's common stock (symbol: VX) is quoted on AMEX. For more
information, visit www.vialog.com, or visit www.webconferencing.com for direct,
online access to Vialog's conferencing and messaging services.
FOR FURTHER INFORMATION REGARDING VIALOG FREE OF
CHARGE, VIA FAX DIAL 1-800-PRO-INFO AND USE THE
COMPANY CODE VX. OR VISIT THE VIALOG CORPORATION
WEBSITE AT WWW.VIALOG.COM
TO SCHEDULE ANY OF VIALOG'S SERVICES ONLINE, GO TO WWW.WEBCONFERENCING.COM
TABLES TO FOLLOW . . .
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VIALOG CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE PERIODS ENDED DECEMBER 31, 2000 AND 1999
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31, DECEMBER 31,
---------------------------- ----------------------------
2000 1999 2000 1999
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(UNAUDITED)
Net revenues $ 19,800 $ 17,714 $ 77,587 $ 68,629
Cost of revenues, excluding depreciation 9,160 8,196 34,304 32,387
Selling, general and administrative expense 7,869 6,332 28,275 23,442
Depreciation expense 1,467 1,184 5,430 4,190
Amortization of goodwill and intangibles 1,047 1,232 4,205 4,060
Non-recurring charge - - - 2,982
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Operating income 257 770 5,373 1,568
Interest expense, net (3,604) (3,423) (14,204) (13,524)
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Loss before income tax benefit (expense) (3,347) (2,653) (8,831) (11,956)
Income tax benefit (expense) 200 (64) (325) (164)
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Net loss $ (3,147) $ (2,717) $ (9,156) $ (12,120)
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Loss per common share--basic and diluted $ (0.32) $ (0.30) $ (0.97) $ (1.53)
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Weighted average common shares outstanding 9,702,126 8,983,647 9,435,278 7,947,333
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EBITDA $ 2,771 $ 3,186 $ 15,008 $ 9,818
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VIALOG CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE PERIODS ENDED JANUARY 31, 2001 AND 2000
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
ONE MONTH ENDED
JANUARY 31,
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2001 2000
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Net revenues $ 7,704 $ 6,068
Cost of revenues, excluding depreciation 3,112 2,857
Selling, general and administrative expense 2,314 1,857
Depreciation expense 518 403
Amortization of goodwill and intangibles 350 351
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Operating income 1,410 600
Interest expense, net (1,244) (1,154)
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Income (loss) before income tax expense 166 (554)
Income tax expense -- --
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Net income (loss) $ 166 $ (554)
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Income (loss) per common share--basic and diluted $ 0.02 $ (0.06)
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Weighted average common shares outstanding 9,829,656 9,133,569
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EBITDA $ 2,278 $ 1,354
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VIALOG CORPORATION
CONSOLIDATED BALANCE SHEETS
AS OF DECEMBER 31, 2000 AND 1999
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
DECEMBER 31, DECEMBER 31,
2000 1999
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ASSETS
Current assets:
Cash and cash equivalents $ 459 $ 547
Accounts receivable, net 18,513 11,637
Prepaid expenses 489 435
Other current assets 168 310
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Total current assets 19,629 12,929
Property and equipment, net 22,807 17,814
Deferred debt issuance costs 3,735 3,801
Goodwill and intangible assets, net 59,970 64,094
Other assets 870 583
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Total assets $ 107,011 $ 99,221
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Debt--current $ 84,295 $ 7,102
Accounts payable and accrued expenses 19,734 9,750
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Total current liabilities 104,029 16,852
Long-term debt, less current portion 4,255 75,827
Other long-term liabilities 719 1,499
Total stockholders' equity (deficit) (1,992) 5,043
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Total liabilities and stockholders' equity (deficit) $ 107,011 $ 99,221
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US SEC FILINGS
Genesys Conferencing has filed a Registration Statement on Form F-4 (No.
333-55392) with the United States Securities and Exchange Commission in
connection with the Vialog transaction. The Form F-4 contains a proxy
statement/prospectus relating to the Vialog special meeting and other related
documents. Vialog has mailed the proxy statement/prospectus contained in the
Form F-4 to its stockholders. The Form F-4 and proxy statement/prospectus
contains important information about Genesys, Vialog, the Vialog transaction and
related matters. Investors and stockholders should read the proxy
statement/prospectus and the other documents filed with the US SEC in connection
with the Vialog transaction carefully before they make any decision with respect
to the Vialog transaction. A copy of the merger agreement with respect to the
Vialog transaction has been filed by Vialog as an exhibit to its Form 8-K dated
October 2, 2000. The Form F-4, the proxy statement/prospectus, the Form 8-K and
all other documents filed with the US SEC in connection with the transaction are
available free of charge at the US SEC's web site at www.sec.gov. In addition,
the proxy statement/prospectus, the Form 8-K and all other documents filed with
the US SEC in connection with the Vialog transaction will be made available to
investors free of charge by calling or writing to:
Genesys S.A.
Pierre Schwich
Chief Financial Officer
4 Rue Jules Ferry, BP 1145
34008 Montpellier, Cedex 1, France
Phone: 33 4 67062755
Email: pierre.schwich@genesys.com
Vialog Corporation
Michael E. Savage
Chief Financial Officer
32 Crosby Drive
Bedford, MA 01730
Phone: 781-761-6200
Email: msavage@vialog.com
In addition to the Form F-4, the proxy statement/prospectus and the other
documents filed with the US SEC in connection with the Vialog transaction,
Vialog is obligated to file annual, quarterly and special reports, proxy
statements and other information with the US SEC. You may read and copy any
reports, statements and other information filed with the US SEC at the US SEC's
public reference rooms at 450 Fifth Street, N.W., Washington, D.C. 20549 or at
the other public reference rooms in New York, New York and Chicago, Illinois.
Please call the US SEC at 1-800-SEC-0330 for further information on public
reference rooms. Filings with the US SEC also are available to the public from
commercial document-retrieval services and at the web site maintained by the US
SEC at http//www.sec.gov.
SOLICITATION OF PROXIES; INTERESTS OF CERTAIN PERSONS IN THE TRANSACTION
The identity of the people who, under SEC rules, may be considered "participants
in the solicitation" of Vialog stockholders in connection with the proposed
merger, and a description of their interests, is available in a SEC filing on
Schedule 14A made by Vialog on October 2, 2000.
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FORWARD-LOOKING STATEMENTS
This release contains statements that constitute forward-looking statements
within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.
Forward-looking statements are statements other than historical information or
statements of current condition. These statements appear in a number of places
in this release and include statements concerning the parties' intent, belief or
current expectations regarding future events, including: the growth of
Ready-to-Meet revenues, the anticipated timing of the Genesys Conferencing
transaction, and the benefits and results of the Genesys Conferencing
transaction. Forward-looking statements are not guarantees of future performance
and involve risks and uncertainties, and actual results may differ materially
from those in the forward-looking statements as a result of various factors.
Although management of the parties believe that their expectations reflected in
the forward looking statements are reasonable based on information currently
available to them, they cannot assure you that the expectations will prove to
have been correct. Accordingly, you should not place undue reliance on these
forward-looking statements. In any event, these statements speak only as of the
date of this release. The parties undertake no obligation to revise or update
any of them to reflect events or circumstances after the date of this release,
or to reflect new information or the occurrence of unanticipated events. Readers
are referred to Vialog's Annual Report to Stockholders and Genesys
Conferencing's and Vialog's other filings with the US SEC for a discussion of
these and other important risk factors concerning the parties and their
respective operations.