Attached files
| file | filename |
|---|---|
| 8-K - J2 GLOBAL COMMUNICATIONS, INC. - J2 GLOBAL, INC. | form8-k_16637.htm |
| EX-99.2 - NOVEMBER 4, 2009 INVESTOR PRESENTATION - J2 GLOBAL, INC. | exh99-2_16637.htm |
EXHIBIT 99.1
j2
Global Reports Third Quarter 2009 Results
Record
Fiscal Third Quarter and Nine Months Free Cash Flow
LOS ANGELES—NOVEMBER 4,
2009—j2 Global Communications, Inc. [NASDAQGS:JCOM] today reported financial
results for the third quarter ended September 30, 2009.
THIRD QUARTER 2009
RESULTS
Subscriber
revenues for Q3 2009 increased to $61.0 million compared to $60.5 million in Q3
2008.
Total
revenues for Q3 2009 increased to $61.8 million compared to $61.6 million in Q3
2008.
During Q3
2009, the Company improved its gross margin to 81.8% from 81.0% in Q3 2008 and
its operating margin to 43.1% from 40.9% in Q3 2008. Both margins are a record
for a fiscal third quarter and a nine month period.
Net
earnings per diluted share for Q3 2009 increased to $0.43 compared to $0.42 in
Q3 2008.
Free cash
flows for Q3 2009 increased 74% to $26.1 million compared to $15.0 million in Q3
2008.
The
Company ended the quarter with approximately $222.5 million in cash and
investments.
Key financial results for third
quarter 2009 versus third
quarter 2008 are as
follows:
|
Q3
2009
|
Q3
2008
|
|
|
Subscriber
Revenues
|
$61.0
million
|
$60.5
million
|
|
Total
Revenues
|
$61.8
million
|
$61.6
million
|
|
Net
Earnings
|
$19.3
million
|
$18.8
million
|
|
Net
Earnings per Diluted Share (1)
|
$0.43
|
$0.42
|
|
Free
Cash Flows
|
$26.1
million
|
$15.0
million
|
|
(1)
|
The
estimated effective tax rate was approximately 28% and 30% for Q3 2009 and
Q3 2008, respectively.
|
“In Q3,
we continued to successfully execute our 2009 plan to improve margins while
maintaining modest growth in this difficult economy,” said Scott Turicchi, j2
Global’s President. “I am pleased that this disciplined approach to
cost-management has yielded record free cash flow and margins for a fiscal third
quarter and a nine month period.”
“As we
enter 2010, we look forward to turning our attention to new initiatives which we
have put on hold pending the economic recovery,” said Hemi Zucker, j2 Global’s
chief executive officer. “Our planned initiatives include additional
marketing programs, new product development, M&A and geographic expansion in
our voice, email and fax service areas.”
About
j2 Global Communications
Founded
in 1995, j2 Global Communications, Inc. provides outsourced, value-added
messaging and communications services to individuals and businesses around the
world. j2 Global’s network spans more than 3,500 cities in 46 countries on six
continents. The Company offers faxing and voicemail solutions, document
management solutions, Web-initiated conference calling, and unified-messaging
and communications services. j2 Global markets its services principally under
the brand eFax®, eFax Corporate®, Onebox®, eVoice® and Electric Mail®. As of
December 31, 2008, j2 Global had achieved 13 consecutive fiscal years of revenue
growth and seven consecutive fiscal years of positive and growing operating
earnings. For more information about j2 Global, please visit
www.j2global.com.
Contact:
Jeff
Adelman
j2 Global
Communications, Inc.
323-372-3617
press@j2global.com
“Safe Harbor” Statement Under the
Private Securities Litigation Reform Act of 1995: Certain statements in
this Press Release are “forward-looking statements” within the meaning of The
Private Securities Litigation Act of 1995, particularly those contained in Mr.
Zucker’s quote. These forward-looking statements are based on management’s
current expectations or beliefs and are subject to numerous assumptions, risks
and uncertainties that could cause actual results to differ materially from
those described in the forward-looking statements. These factors and
uncertainties include, among other items: our ability to launch
additional marketing programs and the success of those programs, our ability to
release new products and the success of those products, our ability to expand
our network and services into new geographic regions, and the numerous other
factors set forth in j2 Global’s filings with the Securities and Exchange
Commission (“SEC”). For a more detailed description of the risk factors and
uncertainties affecting j2 Global, refer to the 2008 Annual Report on Form 10-K
filed by j2 Global on February 25, 2009, and the other reports filed by j2
Global from time-to-time with the SEC, each of which is available at www.sec.gov.
Although management’s expectations may change after the date of this press
release, the Company undertakes no obligation to revise or update these
expectations.
- 2
-
j2
GLOBAL COMMUNICATIONS, INC.
CONDENSED
CONSOLIDATED BALANCE SHEETS
(UNAUDITED,
IN THOUSANDS)
|
SEPTEMBER
30,
|
DECEMBER
31,
|
|||||||
|
2009
|
2008
|
|||||||
|
ASSETS
|
||||||||
|
Cash
and cash equivalents
|
$ | 188,350 | $ | 150,780 | ||||
|
Short-term
investments
|
31,165 | 14 | ||||||
|
Accounts
receivable,
|
||||||||
|
net
of allowances of $3,031 and $2,896, respectively
|
13,435 | 14,083 | ||||||
|
Prepaid
expenses and other current assets
|
10,995 | 6,683 | ||||||
|
Deferred
income taxes
|
2,958 | 2,958 | ||||||
|
Total
current assets
|
246,903 | 174,518 | ||||||
|
Long-term
investments
|
2,950 | 11,081 | ||||||
|
Property
and equipment, net
|
15,805 | 18,938 | ||||||
|
Goodwill
|
81,070 | 72,783 | ||||||
|
Other
purchased intangibles, net
|
37,357 | 36,791 | ||||||
|
Deferred
income taxes
|
8,711 | 7,787 | ||||||
|
Other
assets
|
262 | 142 | ||||||
|
TOTAL
ASSETS
|
$ | 393,058 | $ | 322,040 | ||||
|
LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
|
Accounts
payable and accrued expenses
|
$ | 16,723 | $ | 16,915 | ||||
|
Income
taxes payable
|
1,408 | 1,800 | ||||||
|
Deferred
revenue
|
11,936 | 13,680 | ||||||
|
Total
current liabilities
|
30,067 | 32,395 | ||||||
|
Accrued
income tax liability
|
44,419 | 38,643 | ||||||
|
Other
long-term liabilities
|
3,210 | 1,022 | ||||||
|
Total
liabilities
|
77,696 | 72,060 | ||||||
|
Commitments
and contingencies
|
— | — | ||||||
|
Total
stockholders' equity
|
315,362 | 249,980 | ||||||
|
TOTAL
LIABILITIES AND STOCKHOLDERS' EQUITY
|
$ | 393,058 | $ | 322,040 | ||||
- 3
-
j2
GLOBAL COMMUNICATIONS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED,
IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
|
THREE
MONTHS ENDED SEPTEMBER 30,
|
NINE
MONTHS ENDED SEPTEMBER 30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Revenues
|
||||||||||||||||
|
Subscriber
|
$ | 61,045 | $ | 60,466 | $ | 181,734 | $ | 177,218 | ||||||||
|
Other
|
756 | 1,086 | 2,922 | 3,659 | ||||||||||||
|
Total
revenue
|
61,801 | 61,552 | 184,656 | 180,877 | ||||||||||||
|
Cost
of revenues (including share-based compensation of $323 and $935 for the
three and nine months of 2009, respectively, and $259 and $646 for the
three and nine months of 2008, respectively)
|
11,258 | 11,670 | 34,250 | 35,026 | ||||||||||||
|
Gross
profit
|
50,543 | 49,882 | 150,406 | 145,851 | ||||||||||||
|
Operating
expenses:
|
||||||||||||||||
|
Sales
and marketing (including share-based compensation of $477 and $1,338 for
the three and nine months of 2009, respectively, and $289 and $955 for the
three and nine months of 2008, respectively)
|
9,347 | 10,788 | 27,443 | 31,587 | ||||||||||||
|
Research,
development and engineering (including share-based compensation of $217
and $634 for the three and nine months of 2009, respectively, and $215 and
$620 for the three and nine months of 2008, respectively)
|
2,862 | 3,022 | 8,685 | 9,180 | ||||||||||||
|
General
and administrative (including share-based compensation of $1,877 and
$5,188 for the three and nine months of 2009, respectively, and $1,228 and
$3,771 for the three and nine months of 2008,
respectively)
|
11,667 | 10,911 | 33,582 | 33,360 | ||||||||||||
|
Total
operating expenses
|
23,876 | 24,721 | 69,710 | 74,127 | ||||||||||||
|
Operating
earnings
|
26,667 | 25,161 | 80,696 | 71,724 | ||||||||||||
|
Other-than-temporary
impairment losses
|
— | — | (9,193 | ) | — | |||||||||||
|
Interest
and other income, net
|
20 | 1,655 | 477 | 3,546 | ||||||||||||
|
Earnings
before income taxes
|
26,687 | 26,816 | 71,980 | 75,270 | ||||||||||||
|
Income
tax expense
|
7,353 | 8,054 | 22,857 | 22,984 | ||||||||||||
|
Net
earnings
|
$ | 19,334 | $ | 18,762 | $ | 49,123 | $ | 52,286 | ||||||||
|
Basic
net earnings per common share
|
$ | 0.44 | $ | 0.43 | $ | 1.12 | $ | 1.16 | ||||||||
|
Diluted
net earnings per common share
|
$ | 0.43 | $ | 0.42 | $ | 1.09 | $ | 1.13 | ||||||||
|
Basic
weighted average shares outstanding
|
44,126,038 | 43,479,943 | 43,840,308 | 44,955,199 | ||||||||||||
|
Diluted
weighted average shares outstanding
|
45,296,147 | 45,077,671 | 44,985,160 | 46,431,507 | ||||||||||||
- 4
-
j2
GLOBAL COMMUNICATIONS, INC.
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED,
IN THOUSANDS)
|
NINE
MONTHS ENDED SEPTEMBER 30,
|
||||||||
|
2009
|
2008
|
|||||||
|
Cash
flows from operating activities:
|
||||||||
|
Net
earnings
|
$ | 49,123 | $ | 52,286 | ||||
|
Adjustments
to reconcile net earnings to net cash
|
||||||||
|
provided
by operating activities:
|
||||||||
|
Depreciation
and amortization
|
10,990 | 9,678 | ||||||
|
Share-based
compensation
|
8,095 | 5,992 | ||||||
|
Excess
tax benefits from share-based compensation
|
(3,126 | ) | (655 | ) | ||||
|
Provision
for doubtful accounts
|
1,710 | 2,967 | ||||||
|
Deferred
income taxes
|
(924 | ) | (1,729 | ) | ||||
|
Loss
on disposal of fixed assets
|
15 | 20 | ||||||
|
Other-than-temporary
impairment losses
|
9,193 | — | ||||||
|
Decrease
(increase) in:
|
||||||||
|
Accounts
receivable
|
(803 | ) | (2,983 | ) | ||||
|
Prepaid
expenses and other current assets
|
(737 | ) | 1,452 | |||||
|
Other
assets
|
(123 | ) | 26 | |||||
|
(Decrease)
increase in:
|
||||||||
|
Accounts
payable and accrued expenses
|
(723 | ) | 1,324 | |||||
|
Income
taxes payable
|
(724 | ) | (5,299 | ) | ||||
|
Deferred
revenue
|
219 | (1,305 | ) | |||||
|
Accrued
income tax liability
|
5,776 | 5,196 | ||||||
|
Other
|
22 | (43 | ) | |||||
|
Net
cash provided by operating activities
|
77,983 | 66,927 | ||||||
|
Cash
flows from investing activities:
|
||||||||
|
Sales
of available-for-sale investments
|
— | 36,170 | ||||||
|
Redemptions/Sales
of held-to-maturity investments
|
— | 27,883 | ||||||
|
Purchase
of certificates of deposit
|
(31,150 | ) | — | |||||
|
Purchases
of property and equipment
|
(1,704 | ) | (2,202 | ) | ||||
|
Acquisition
of businesses, net of cash received
|
(11,915 | ) | (32,435 | ) | ||||
|
Proceeds
from sale of assets
|
1,340 | — | ||||||
|
Purchases
of intangible assets
|
(3,146 | ) | (2,320 | ) | ||||
|
Net
cash (used in) provided by investing activities
|
(46,575 | ) | 27,096 | |||||
|
Cash
flows from financing activities:
|
||||||||
|
Repurchases
of common stock
|
— | (108,028 | ) | |||||
|
Repurchase
of restricted stock
|
(441 | ) | (417 | ) | ||||
|
Issuance
of common stock under employee stock purchase plan
|
89 | 153 | ||||||
|
Exercise
of stock options
|
2,638 | 1,468 | ||||||
|
Excess
tax benefits from share-based compensation
|
3,126 | 655 | ||||||
|
Net
cash provided by (used in) financing activities
|
5,412 | (106,169 | ) | |||||
|
Effect
of exchange rate changes on cash and cash equivalents
|
750 | (1,353 | ) | |||||
|
Net
increase (decrease) in cash and cash equivalents
|
37,570 | (13,499 | ) | |||||
|
Cash
and cash equivalents at beginning of period
|
150,780 | 154,220 | ||||||
|
Cash
and cash equivalents at end of period
|
$ | 188,350 | $ | 140,721 | ||||
- 5
-
j2
Global Communications, Inc.
Free
Cash Flows
| Q1 | Q2 | Q3 | Q4 |
YTD
|
||||||||||||||||
|
2009
|
||||||||||||||||||||
|
Net
cash provided by operating activities
|
31,152 | 20,362 | 26,469 | 77,983 | ||||||||||||||||
|
Less:
Purchases of property and equipment
|
(721 | ) | (217 | ) | (767 | ) | (1,705 | ) | ||||||||||||
|
Add:
Excess tax benefit from share-based compensation
|
5 | 2,718 | 403 | 3,126 | ||||||||||||||||
| 30,436 | 22,863 | 26,105 | — | 79,404 | ||||||||||||||||
|
2008
|
||||||||||||||||||||
|
Net
cash provided by operating activities
|
27,411 | 23,840 | 15,676 | 23,789 | 90,716 | |||||||||||||||
|
Less:
Purchases of property and equipment
|
(469 | ) | (796 | ) | (937 | ) | (305 | ) | (2,507 | ) | ||||||||||
|
Add:
Excess tax benefit from share-based compensation
|
239 | 204 | 212 | 910 | 1,565 | |||||||||||||||
| 27,181 | 23,248 | 14,951 | 24,394 | 89,774 | ||||||||||||||||
|
2007
|
||||||||||||||||||||
|
Net
cash provided by operating activities
|
26,659 | 23,113 | 18,656 | 25,779 | 94,207 | |||||||||||||||
|
Less:
Purchases of property and equipment
|
(529 | ) | (2,506 | ) | (2,940 | ) | (4,340 | ) | (10,315 | ) | ||||||||||
|
Add:
Excess tax benefit from share-based compensation
|
2,163 | 780 | 517 | 1,271 | 4,731 | |||||||||||||||
| 28,293 | 21,387 | 16,233 | 22,710 | 88,623 | ||||||||||||||||
- 6
-