EXHIBIT 99.2
Premiere Global Reports First Quarter Results: Revenues up 11% to
$135.6M, $0.19 Pro Forma Diluted EPS from Continuing Operations(a)
Board Appoints Steve Jones, Dean of Kenan-Flagler Business School
of the University of North Carolina at Chapel Hill, as New Independent
Director
ATLANTA--(BUSINESS WIRE)--April 19, 2007--Premiere Global
Services, Inc. (NYSE: PGI), a global provider of on-demand
communication technologies-based business process improvement
solutions, today announced results for the first quarter ended March
31, 2007.
Revenues
Consolidated revenues in the first quarter of 2007 increased 11.4%
to $135.6 million compared to $121.7 million in the first quarter of
2006. Aggregate revenues from the Premiere Global Communications
Operating System six solution sets increased 19.6%, excluding revenue
from legacy broadcast fax in both periods.(a)
GAAP Earnings
In the first quarter of 2007 in accordance with GAAP, operating
income totaled $14.7 million, income from continuing operations
totaled $8.9 million and diluted EPS from continuing operations
totaled $0.13, compared to $14.0 million, $7.7 million and $0.11,
respectively, in the first quarter of 2006. These results include the
reversal of restructuring costs of $0.1 million and a one-time tax
benefit of $0.6 million. The results also include the following items
on a pre-tax basis: proxy-related costs of $0.9 million, $2.8 million
of equity-based compensation and $3.6 million of amortization.
Pro Forma Earnings
In the first quarter of 2007, excluding a one-time tax benefit,
restructuring costs, proxy-related costs, equity-based compensation
and amortization, pro forma diluted EPS from continuing operations
totaled $0.19.(a)
"I believe our solid first quarter performance illustrates the
increasing value PGI brings to the thousands of global enterprises
that use our on-demand communication technologies to automate,
simplify and improve their critical, daily business processes," said
Boland T. Jones, Founder, Chairman and CEO of Premiere Global
Services, Inc. "PGI is defining and leading the category of
Constituent Relationship Management by recognizing and fulfilling
companies' universal need to enhance relationships with their
customers, employees, vendors, trade partners, investors and other
important stakeholders."
Revenue Detail
Revenue from Conferencing solutions grew 27.0% to $84.8 million in
the first quarter of 2007 compared to $66.8 million in the comparable
prior year quarter. Revenue from legacy broadcast fax services totaled
$19.6 million in the first quarter of 2007, a decline of $5.1 million
as compared to $24.7 million in the first quarter of 2006.
In the first quarter of 2007, revenue in the Company's reportable
segments was as follows:
-- North America increased 10.7% to $88.0 million, versus $79.5
million in the first quarter of 2006;
-- Europe increased 8.2% to $24.9 million, versus $23.0 million
in the first quarter of 2006; and
-- Asia Pacific grew 18.2% to $22.7 million, versus $19.2 million
in the first quarter of 2006.
Director Appointment
The Company also announced today that it has appointed W. Steven
Jones, Dean of Kenan-Flagler Business School of the University of
North Carolina at Chapel Hill, as a Class I director to fill a vacancy
on the Board. Prior to becoming Dean of UNC Kenan-Flagler, Mr. Jones
served as Chief Executive Officer and Managing Director of Suncorp
Metway Ltd., a banking, insurance and funds management company in
Brisbane, Queensland, and one of the 25 largest companies in
Australia. He has also served as Managing Director and Chief Executive
Officer of ANZ Banking Group, N.Z., Ltd., one of Australia's four
largest banks, and was a consultant with McKinsey & Company in Atlanta
and Melbourne. Mr. Jones currently serves as a director of Bank of
America, N.A. and of Progress Energy Inc.
The appointment of Mr. Jones brings the total number of
independent directors on the Company's Board of Directors to six out
of seven total members. Steve Jones is not related to the Company's
Chairman and CEO, Boland Jones.
"We are delighted to have Steve join our Board, as he brings with
him a wealth of business experience from his years of running
international companies and one of the finest business schools in the
country," said Boland Jones. "We will look to Steve for advice and
counsel in the areas of international expansion, sales and marketing
strategies, and for key contacts throughout the business community, as
we seek to grow PGI's global profile."
Financial Outlook
The following statements are based on Premiere Global Services'
current expectations as of April 19, 2007. 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. 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's financial outlook for 2007 is as follows:
Revenues
The Company anticipates growth in consolidated revenues for the
year will be at the high-end of its previous forecast. The Company had
previously projected consolidated revenues to increase 5% to 7% in
2007 from 2006 totals.
Earnings
As a result of expected operating efficiencies from the Company's
initiatives to increase automation, to streamline service delivery and
to consolidate its operations, earnings are projected to grow at a
faster rate than revenues in 2007.
Cash Flows and Other
The Company anticipates incurring restructuring costs in the range
of $4.0 to $4.5 million during the second quarter of 2007, primarily
related to the re-engineering of its global operations. Excluding
anticipated restructuring costs, the Company projects cash flows
provided by operating activities from continuing operations will grow
approximately 20% in 2007 from 2006 totals.
Capital expenditures are expected to be in the range of 6.5% to
7.0% of revenues due to increased investment in automation
initiatives, including the development of PGI's new Web portal
designed to bring the Company's products and services online. The
Company anticipates its effective tax rate will be in the range of 34%
to 35% in 2007, excluding the one-time tax benefit in the first
quarter of 2007.
(a) To supplement the Company's consolidated financial statements
presented in accordance with GAAP, we have included the following
non-GAAP measures of financial performance: pro forma operating
income, pro forma income from continuing operations and pro forma
diluted EPS from continuing operations. 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. In addition, we present certain consolidated
and solution revenue growth statistics that are derived from non-GAAP
financial measures. Please see the tables 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.
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) 289-0529 (US & Canada) or (913) 981-5523
(International). The conference call will be simultaneously broadcast
over the Internet via SoundCast(R), a Premiere Global service, and can
be accessed at PGiConnect.com/IR. You may also follow this link for
details on the Internet replay, podcast 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 April 27, 2007, and can be accessed by
calling (888) 203-1112 (US & Canada) or (719) 457-0820
(International). The confirmation code is 8787467. The Webcast of this
call will be archived on the Company's Website at PGiConnect.com/IR.
About Premiere Global Services, Inc.
Premiere Global Services, Inc. is a global provider of on-demand
communication technologies-based business process improvement
solutions, which we call the Premiere Global Communications Operating
System, or the PGiCOS for short.
Our hundreds of industry specific applications enable businesses
to automate and simplify their communication-centric business
processes and to communicate more efficiently and effectively with
their constituents. We group our applications into six solution sets:
Conferencing, Desktop Fax, Document Delivery, Accounts Receivable
Management, Notifications & Reminders, and eMarketing.
Today, we deliver our solutions to an established customer base of
approximately 60,000 corporate accounts, including nearly 80% of the
Fortune 500. In 2006, more than 500,000 enterprise users leveraged
PGiCOS to gain a competitive advantage in sales, support and customer
service.
With global presence in 19 countries, Premiere Global Services'
corporate headquarters is located at 3399 Peachtree Road NE, Suite
700, Atlanta, GA 30326. Additional information can be found at
www.PGiConnect.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; continued weakness in our legacy
broadcast fax business; foreign currency exchange rates; possible
adverse results of pending or future litigation or infringement
claims; federal or state 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" section of our Annual Report on Form 10-K for the year
ended December 31, 2006. 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
THREE MONTHS ENDED MARCH 31, 2007 AND 2006
(IN THOUSANDS, UNAUDITED, EXCEPT SHARE AND PER SHARE DATA)
Three Months Ended
March 31,
2007 2006
--------- ---------
Revenues $135,626 $121,726
Operating expenses:
Cost of revenues (exclusive of depreciation shown
separately below) 53,896 48,340
Selling and marketing 36,468 32,798
General and administrative 16,573 13,754
Research and development 3,431 2,807
Depreciation 7,089 5,927
Amortization 3,552 3,097
Restructuring costs (130) 1,053
--------- ---------
Total operating expenses 120,879 107,776
Operating income 14,747 13,950
--------- ---------
Other (Expense) Income:
Interest expense (2,302) (1,814)
Interest income 100 161
Other, net 458 (233)
--------- ---------
Total other (expense) income (1,744) (1,886)
--------- ---------
Income from continuing operations before income
taxes 13,003 12,064
Income tax expense 4,056 4,405
--------- ---------
Income from continuing operations $8,947 $7,659
========= =========
Net income $8,947 $7,659
========= =========
BASIC WEIGHTED AVERAGE SHARES OUTSTANDING: 67,697 70,465
========= =========
Basic earnings per share:
Continuing operations $0.13 $0.11
========= =========
Net income $0.13 $0.11
========= =========
DILUTED WEIGHTED AVERAGE SHARES OUTSTANDING: 68,776 $71,367
========= =========
Diluted earnings per share:
Continuing operations $0.13 $0.11
========= =========
Net income $0.13 $0.11
========= =========
PREMIERE GLOBAL SERVICES, INC AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, 2007 AND DECEMBER 31, 2006
(IN THOUSANDS, UNAUDITED, EXCEPT SHARE DATA)
March 31, December 31,
2007 2006
--------- ------------
ASSETS
CURRENT ASSETS
Cash and equivalents $19,971 $18,977
Accounts receivable (less allowances of
$4,739 and $4,944, respectively) 90,871 82,875
Prepaid expenses and other current assets 6,712 7,742
Deferred income taxes, net 12,480 11,972
--------- ------------
Total current assets 130,034 121,566
PROPERTY AND EQUIPMENT, NET 90,773 88,062
OTHER ASSETS
Goodwill 295,543 295,185
Intangibles, net of amortization 35,067 38,357
Deferred income taxes, net 1,476 -
Other assets 6,074 6,145
--------- ------------
$558,967 $549,315
========= ============
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable $50,837 $48,967
Income taxes payable 7,521 878
Accrued taxes 7,295 6,011
Accrued expenses 31,198 28,697
Current maturities of long-term debt and capital
lease obligations 1,995 2,044
Accrued restructuring costs 2,817 4,800
--------- ------------
Total current liabilities 101,663 91,397
LONG-TERM LIABILITIES
Long-term debt and capital lease obligations 126,831 136,738
Accrued expenses 3,613 4,170
Deferred income taxes, net - 719
--------- ------------
Total long-term liabilities 130,444 141,627
SHAREHOLDERS' EQUITY
Common stock $0.01 par value; 150,000,000 shares
authorized, 70,361,992 and 70,151,998 shares
issued and outstanding at March 31, 2007 and
December 31, 2006, respectively 704 702
Additional paid-in capital 665,247 663,232
Note receivable, shareholder (2,033) (2,004)
Cumulative translation adjustment 2,999 2,088
Accumulated deficit (340,057) (347,727)
--------- ------------
Total shareholders' equity 326,860 316,291
--------- ------------
$558,967 $549,315
========= ============
PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 2007 AND 2006
(IN THOUSANDS, UNAUDITED)
Three Months
Ended
March 31,
2007 2006
-------- --------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income 8,947 7,659
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 7,089 5,927
Amortization 3,552 3,097
Amortization of deferred financing costs 128 116
Payments for legal settlements and related expenses - (1,372)
Deferred income taxes (1,675) -
Restructuring costs (130) 1,053
Payments for restructuring costs (1,934) (720)
Equity-based compensation 2,775 2,256
Excess tax benefits from share-based payment
arrangements (114) -
Loss on disposal of assets 146 256
Changes in assets and liabilities, net of effect of
acquisitions:
Accounts receivable, net (7,678) (4,517)
Prepaid expenses and other current assets 919 (864)
Accounts payable and accrued expenses 7,473 3,952
-------- --------
Total adjustments 10,551 9,184
-------- --------
Net cash provided by operating activities from
continuing operations 19,498 16,843
-------- --------
Payments for discontinued operations (244) (245)
-------- --------
Net cash provided by operating activities 19,254 16,598
-------- --------
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures (7,250) (8,993)
Business acquisitions, net of cash acquired (412) (13,896)
-------- --------
Net cash used in investing activities (7,662) (22,889)
-------- --------
CASH FLOWS FROM FINANCING ACTIVITIES
Principal payments under borrowing arrangements (94,364) (21,618)
Principal proceeds under borrowing arrangements 84,280 29,500
Excess tax benefits from share-based payment
arrangements 114 -
Purchase of treasury stock, at cost (371) (750)
Exercise of stock options 257 1,050
-------- --------
Net cash (used in) provided by financing
activities (10,084) 8,182
-------- --------
Effect of exchange rate changes on cash and
equivalents (514) (138)
NET INCREASE IN CASH AND EQUIVALENTS 994 1,753
-------- --------
CASH AND EQUIVALENTS, beginning of period $18,977 $20,508
-------- --------
CASH AND EQUIVALENTS, end of period $19,971 $22,261
======== ========
PREMIERE GLOBAL SERVICES, INC AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
(IN THOUSANDS, UNAUDITED, EXCEPT PER SHARE DATA)
Three Months Ended
March 31,
2007 2006
--------- ---------
Revenues Excluding Legacy Broadcast Fax Revenue
(1)
Revenues, as reported $135,626 $121,726
Excluding legacy broadcast fax revenue 19,586 24,680
--------- ---------
Revenues, excluding legacy broadcast fax
revenue $116,040 $97,046
--------- ---------
Pro Forma Operating Income (2)
Operating income, as reported $14,747 $13,950
Restructuring costs (130) 1,053
Proxy-related costs 911 -
Equity-based compensation 2,775 2,256
Amortization 3,552 3,097
--------- ---------
Pro forma operating income $21,855 $20,356
--------- ---------
Pro Forma Income from Continuing Operations (2)
Income from continuing operations, as reported $8,947 $7,659
Elimination of one-time tax benefit (615) -
Restructuring costs, net of taxes (84) 654
Proxy-related costs, net of taxes 586 -
Equity-based compensation, net of tax 1,784 1,447
Amortization, net of tax 2,284 1,966
--------- ---------
Pro forma income from continuing operations $12,902 $11,726
--------- ---------
Pro Forma Diluted EPS from Continuing Operations
(2)
Diluted EPS from continuing operations, as
reported $0.13 $0.11
Elimination of one-time tax benefit (0.01) -
Restructuring costs, net of taxes (0.00) 0.01
Proxy-related costs, net of taxes 0.01 -
Equity-based compensation, net of tax 0.03 0.02
Amortization, net of tax 0.03 0.02
--------- ---------
Pro forma diluted EPS from continuing
operations $0.19 $0.16
========= =========
(1) Management has previously announced the decline of revenue
generated by its legacy broadcast fax services. Management has
presented revenues excluding this item because management believes
that events or trends particular to these services may be deemed to
be so significant to obscure patterns and trends of our core
solutions sets in total.
(2) Management believes that pro forma operating income, pro forma
income from continuing operations and pro-forma 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 pro forma diluted EPS from continuing operations to exclude
these items as well as non-recurring items that are unrelated to our
ongoing operations, including a one-time tax benefit, restructuring
costs and proxy-related costs.
CONTACT: Premiere Global Services, Inc., Atlanta
Investor Calls
Sean O'Brien, 404-262-8462
Senior Vice President
Strategic Planning & IR