Exhibit 99.1
Premiere Global Services Reports Q2 Results: Revenues $132.1 up 18%, Operating
Income $23.3M up 32%, Diluted EPS $0.19; Company Lowers 2005 Revenue Outlook
Primarily Due to Foreign Exchange Rates; Maintains Earnings Guidance
ATLANTA--(BUSINESS WIRE)--July 27, 2005--Premiere Global Services,
Inc. (NYSE: PGI), a global outsource provider of business
communications services and business process solutions, today
announced results for the second quarter ended June 30, 2005. Revenues
were $132.1 million for the quarter, an increase of 18.4% from $111.6
million in the second quarter of 2004. Operating income grew 32.5% in
the second quarter of 2005, totaling $23.3 million versus $17.6
million in the comparable prior year period. Income from continuing
operations totaled $13.5 million and diluted EPS from continuing
operations was $0.19 in the second quarter of 2005, versus breakeven
income from continuing operations and diluted EPS from continuing
operations of $0.01 in the second quarter of 2004.(1)
Revenues totaled $259.3 million for the six months ended June 30,
2005, a 19.6% increase from $216.9 million in the comparable prior
year period. Operating income grew 37.3% in the first half of 2005,
totaling $45.7 million versus $33.3 million in the first half of 2004.
Income from continuing operations totaled $26.6 million and diluted
EPS from continuing operations totaled $0.37 in the first half of
2005, versus $8.7 million in income from continuing operations and
$0.14 in diluted EPS from continuing operations in the comparable
prior year period.(1)
Second Quarter 2005 Accomplishments
-- Increased Conferencing & Collaboration revenue by 34.1% to
$66.6 million
-- Grew Data Communications revenue by 5.7% to $65.5 million
-- Generated $32.3 million of cash flows from operating
activities up 48.8%
-- Repurchased 502,500 shares of our common stock in the open
market
"I am proud to report another quarter of solid performance," said
Boland T. Jones, Founder, Chairman and CEO of Premiere Global
Services, Inc. "Growth in our new business process solutions remains
on track, as the value of these solutions begins to prove itself in
the market, and I remain enthusiastic about our growth prospects.
However, the dramatic negative change in foreign currency exchange
rates combined with an acceleration in the decline of our legacy
broadcast fax business in North America will negatively impact our
revenues in the second half of the year resulting in the lowering of
our forecast. In light of these recent developments, we are
aggressively lowering costs in order to maintain profitability and
cash flow generation in-line with our previous guidance."
Financial Outlook
The following statements are based on Premiere Global Services'
current expectations as of July 27, 2005. These statements are
forward-looking statements and actual results may differ materially.
The Company assumes no duty to update any forward-looking statements
made in this press release. A discussion concerning forward-looking
statements is included at the end of this press release and in the
Company's filings with the Securities and Exchange Commission.
The Company has lowered its revenue outlook for the remainder of
the year, principally due to adverse movements in foreign currency
exchange rates and also due to an acceleration in the decline of
revenues generated by the Company's legacy broadcast fax business in
North America. Premiere Global now anticipates revenues in 2005 will
be in the range of $505 to $510 million, including projected revenue
contribution of approximately $5 million from the pending acquisition
of Netspoke, which the Company anticipates closing effective early
August 2005. Premiere Global believes diluted EPS from continuing
operations in 2005 will be in the range of $0.70 to $0.73, as
previously guided. The Company plans to discuss its financial guidance
on its earnings call this afternoon at 5:00 p.m. Eastern.
(1)Results in the second quarter and six months ended 2004 were
negatively impacted by a charge of approximately $17.0 million
associated with the conversion of the Company's subordinated
convertible notes due 2008.
Conference Call
The Company will hold a conference call at 5:00 p.m. Eastern this
afternoon 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: (800) 289-0493 (US & Canada) or (913) 981-5510
(International). The conference call will be simultaneously broadcast
over the Internet via SoundCast(R), a Premiere Global service, and can
be accessed at http://ir.premiereglobal.com. You may also follow this
link for details on the Internet replay and for the text of the
earnings release, including the financial and statistical information
to be presented in the call.
A replay will be available following the call at 8:00 p.m. Eastern
through midnight Eastern August 5, 2005, and can be accessed by
calling (888) 203-1112 (US & Canada) or (719) 457-0820
(International). The confirmation code is 3805459. The Webcast of this
call will be archived on the Company's Website at
http://ir.premiereglobal.com.
About Premiere Global Services, Inc.
Premiere Global Services, Inc. (formerly Ptek Holdings, Inc.)
provides business communications services and business process
solutions that enable enterprise customers to automate and simplify
components of their critical business processes and to communicate
more effectively with their constituents.
We offer data management and delivery solutions and conferencing
and collaboration services on an outsource-basis, hosted on our global
proprietary platforms. Customers apply our communication
technologies-based solutions to a number of business processes, such
as receivables collections, continuing education, alerts and
notifications, investor calls, statement and invoice delivery,
international collaboration, document automation, and other
applications, in order to increase efficiency, to improve productivity
and to raise customer satisfaction levels.
With over 2,230 employees in 19 countries around the world,
Premiere Global Services(SM) has an established customer base of
approximately 54,000 corporate accounts, including a majority of the
Fortune 500. Our corporate headquarters is located at 3399 Peachtree
Road NE, Suite 700, Atlanta, GA 30326. Additional information can be
found at www.premiereglobal.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' forward-looking statements,
including, but not limited to, the following factors: competitive
pressures, including pricing pressures; technological change; the
development of alternatives to our services; market acceptance of our
new services and enhancements; integration of acquired companies;
service interruptions; increased financial leverage; our dependence on
our subsidiaries for cash flow; foreign currency exchange rates;
possible adverse results of pending or future litigation or
infringement claims; legislative or regulatory changes; general
domestic and international economic, business or political conditions;
and other factors described from time to time in our press releases,
reports and other filings with the SEC, including but not limited the
"Risk Factors Affecting Future Performance" section of our Annual
Report on Form 10-K for the year ended December 31, 2004. 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
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND SIX MONTHS ENDED JUNE 30, 2005 AND 2004
(IN THOUSANDS, UNAUDITED, EXCEPT PER SHARE DATA)
Three Months Ended Six Months Ended
-------------------- --------------------
June 30, June 30, June 30, June 30,
2005 2004 2005 2004
--------- --------- --------------------
REVENUES $132,053 $111,553 $259,316 $216,907
OPERATING EXPENSES:
Cost of revenues
(exclusive of
depreciation shown
seperately below) 47,567 40,225 93,391 79,738
Selling and marketing 33,813 28,695 66,249 55,616
General and
administrative 13,152 12,511 25,162 23,948
Research and development 2,488 2,925 5,054 5,431
Depreciation 6,373 6,257 12,925 12,834
Amortization 3,364 2,058 6,450 3,812
Restructuring costs 126 - 541 -
Equity based compensation 1,917 1,332 3,880 2,278
-------- -------- -------- --------
Total operating
expenses 108,800 94,003 213,652 183,657
-------- -------- -------- --------
OPERATING INCOME 23,253 17,550 45,664 33,250
-------- -------- -------- --------
OTHER INCOME (EXPENSE):
Interest expense (1,267) (1,530) (2,249) (3,150)
Interest income 108 181 420 348
Debt conversion costs - (17,027) - (17,027)
Loss on sale of marketable
securities - - (116) (87)
Other, net (27) 813 66 829
-------- -------- -------- --------
Total other income
(expense) (1,186) (17,563) (1,879) (19,087)
-------- -------- -------- --------
INCOME (LOSS) FROM
CONTINUING OPERATIONS
BEFORE INCOME TAXES 22,067 (13) 43,785 14,163
INCOME TAX EXPENSE
(BENEFIT) 8,568 27 17,167 5,484
-------- -------- -------- --------
INCOME (LOSS) FROM
CONTINUING OPERATIONS $ 13,499 $ (40) $ 26,618 $ 8,679
======== ======== ======== ========
DISCONTINUED OPERATIONS:
(Loss) gain from
operations of Voicecom (1,952) 1,956 (1,952) 1,956
Income tax (benefit)
expense (683) 761 (683) 761
-------- -------- -------- --------
(Loss) gain on
discontinued
operations (1,269) 1,195 (1,269) 1,195
-------- -------- -------- --------
NET INCOME $ 12,230 $ 1,155 $ 25,349 $ 9,874
======== ======== ======== ========
BASIC EARNINGS PER SHARE:
Income (loss) from
continuing operations $ 13,499 $ (40) $ 26,618 $ 8,679
Net Income $ 12,230 $ 1,155 $ 25,349 $ 9,874
BASIC WEIGHTED AVERAGE
SHARES OUTSTANDING: 70,532 59,426 70,494 57,776
======== ======== ======== ========
Basic earnings per share:
Continuing operations $ 0.19 $ (0.00) $ 0.38 $ 0.15
Discontinued operations$ (0.02) $ 0.02 $ (0.02) $ 0.02
-------- -------- -------- --------
Net Income $ 0.17 $ 0.02 $ 0.36 $ 0.17
======== ======== ======== ========
DILUTED EARNINGS PER SHARE:
Income from continuing
operations for purposes
of computing diluted net
income per share $ 13,499 $ 582 $ 26,618 $ 10,064
Net Income for purposes
of computing diluted net
income per share $ 12,230 $ 1,777 $ 25,349 $ 11,259
DILUTED WEIGHTED AVERAGE
SHARES OUTSTANDING: 72,683 72,278 72,352 71,756
======== ======== ======== ========
Diluted earnings per
share:
Continuing operations $ 0.19 $ 0.01 $ 0.37 $ 0.14
Discontinued operations$ (0.02) $ 0.01 $ (0.02) $ 0.02
-------- -------- -------- --------
Net Income $ 0.17 $ 0.02 $ 0.35 $ 0.16
======== ======== ======== ========
PREMIERE GLOBAL SERVICES, INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
JUNE 30, 2005 AND DECEMBER 31, 2004
(IN THOUSANDS, EXCEPT SHARE DATA)
June 30, Dec. 31,
2005 2004
---------- ----------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and equivalents $ 25,729 $ 25,882
Marketable securities, available for sale - 576
Accounts receivable (less allowances of
$5,863 and $5,706, respectively) 83,895 72,055
Prepaid expenses and other 6,933 5,148
Deferred income taxes, net 12,856 17,706
---------- ----------
Total current assets 129,413 121,367
PROPERTY AND EQUIPMENT, NET 75,095 74,050
OTHER ASSETS
Goodwill 234,331 192,147
Intangibles, net 42,181 40,590
Deferred income taxes, net 3,461 3,461
Other assets 4,169 3,861
---------- ----------
$ 488,650 $ 435,476
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $ 44,318 $ 37,337
Accrued taxes 6,215 6,700
Accrued expenses 40,139 40,192
Income taxes payable 12,905 8,968
Current maturities of long-term debt and
capital lease obligations 665 37
Accrued restructuring costs 1,353 1,071
---------- ----------
Total current liabilities 105,595 94,305
LONG-TERM LIABILITIES
Long-term debt and capital lease
obligations 92,244 68,147
Other accrued expenses 6,281 6,094
---------- ----------
Total long-term liabilities 98,525 74,241
SHAREHOLDERS' EQUITY
Common stock $0.01 par value; 150,000,000
shares authorized, 72,107,593 and 71,301,577
shares issued and outstanding at June 30,
2005 and December 31, 2004, respectively 721 713
Unrealized loss on marketable securities - 6
Additional paid-in capital 698,449 694,284
Unearned restricted stock compensation (15,768) (4,187)
Note receivable, shareholder (1,844) (5,662)
Cumulative translation adjustment (1,724) 2,429
Accumulated deficit (395,304) (420,653)
---------- ----------
Total shareholders' equity 284,530 266,930
---------- ----------
$ 488,650 $ 435,476
========== ==========
PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 2005 AND 2004
(IN THOUSANDS, UNAUDITED)
Six Months Ended
June 30,
2005 2004
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income 25,349 9,874
Adjustments to reconcile net income to net
cash provided by operating activities:
Loss (gain) on discontinued operation 1,269 (1,195)
Debt conversion costs - 17,027
Depreciation 12,925 12,834
Amortization 6,450 3,812
Amortization of deferred financing costs 224 434
Loss on sale of marketable securities,
available for sale 116 87
Deferred income taxes 4,854 1,679
Gain on disposal of assets (45) -
Gain on note receivable and other
liabilities - (423)
Restructuring costs, net (58) (2,974)
Payments for discontinued operations (541) (1,142)
Equity based compensation 3,880 2,278
Changes in assets and liabilities:
Accounts receivable, net (10,092) (3,621)
Prepaid expenses and other current
assets (1,917) (3,024)
Accounts payable and accrued expenses 10,640 (5,011)
--------- ---------
Total adjustments 27,705 20,761
--------- ---------
Total cash provided by operating
activities 53,054 30,635
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (14,264) (12,119)
Business acquisitions (53,379) (28,552)
Sale of marketable securities 755 667
Purchase of marketable securities (306) (245)
Proceeds from note receivable - 1,600
--------- ---------
Net cash used in investing activities (67,194) (38,649)
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal proceeds under borrowing
arrangements 50,700 20,900
Principal payments under borrowing
arrangements (28,378) (5,000)
Payments received on shareholder note 3,953 -
Make whole interest payment - convertible
notes - (16,255)
Purchase of treasury stock, at cost (15,657) (4,495)
Exercise of stock options 6,439 8,218
--------- ---------
Total cash provided by financing
activities 17,057 3,368
--------- ---------
Effect of exchange rate changes on cash and
equivalents (3,070) (423)
--------- ---------
NET DECREASE IN CASH AND EQUIVALENTS (153) (5,069)
--------- ---------
CASH AND EQUIVALENTS, beginning of period $ 25,882 $ 23,946
--------- ---------
CASH AND EQUIVALENTS, end of period $ 25,729 $ 18,877
========= =========
CONTACT: Premiere Global Services, Inc., Atlanta
Investor Calls
Sean O'Brien, 404-262-8462