Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - VONAGE HOLDINGS CORP | d8k.htm |
| EX-99.1 - PRESS RELEASE - VONAGE HOLDINGS CORP | dex991.htm |
 Citi’s
21st
Annual Global Entertainment, Media
and Telecommunications Conference
January 5, 2011
Exhibit 99.2 |
 2
Safe Harbor
Various remarks that we make about Vonage Holdings Corp. future expectations, plans and prospects,
including future products and marketing and growth strategy, revenue, churn, cost of
telephony services, marketing expenses, EBITDA and capital expenditures, constitute
forward-looking statements for purposes of the safe harbor provisions under The Private
Securities Litigation Reform Act of 1995. These forward-looking statements are based on
information available at the time the statements are made and/or management's belief as of that
time with respect to future events and involve risks and uncertainties that could cause actual
results and outcomes to be materially different. Important factors that could cause such
differences include: the competition the Company faces; the Company's ability to adapt to rapid changes in the
market for voice and messaging services and successfully introduce new products and services; the
Company's ability to control customer churn and attract new customers; worsening economic
conditions; restrictions in the Company's debt agreements that may limit its operating
flexibility; system disruptions or flaws in the Company's technology; results of pending or
future litigation or intellectual property matters involving the Company; results of regulatory inquiries into the
Company's business practices; the Company's dependence on third party facilities, equipment and
services; the Company's dependence upon key personnel; any failure to meet New York Stock Exchange
listing requirements; the Company's history of net operating losses; the Company's ability to
obtain additional financing if needed; differences between the Company's service and traditional
phone services, including 911 service; the Company's dependence on customers' existing broadband
connections; uncertainties relating to regulation of VoIP services; the Company's ability to negotiate
favorable rates with service providers and increases in termination charges that may be approved
by regulators in various countries; and other factors that are set forth in the "Risk
Factors" section and other sections of Vonage's Annual Report on Form 10-K for the year
ended December 31, 2009, as well as in the Company's Quarterly Reports on Form 10-Q and Current Reports on Form
8-K. While we may elect to update forward-looking statements at some point in the future,
we specifically disclaim any obligation to do so, and therefore, you should not rely on these
forward-looking statements as representing our views as of any date subsequent to
today. This presentation contains non-GAAP financial measures (including adjusted earnings before interest,
taxes, depreciation and amortization (“EBITDA”), pre-marketing operating income,
and net income (loss) excluding adjustments), as defined in Regulation G adopted by the SEC. We
provide a reconciliation of these non-GAAP financial measures to the most directly comparable
financial measure in our quarterly earnings releases, which can be found on the Vonage Investor Relations
website at http://ir.vonage.com.
Caution Concerning Forward-Looking Statements
Non-GAAP Financial Measures |
 A
stronger company Dramatic operational and financial turnaround
•
$200 million positive swing in EBITDA
1
since 2007
•
Stabilized customer base
•
Reduced churn to lowest 4th quarter level in four years
•
Successfully penetrating international calling segments
Recent refinancing results in highly efficient capital structure
3
Successful Operational and Financial Turnaround
1) This is a non-GAAP financial measure. |
 4
Vision and Strategy
To be a leading provider of low cost communications services
connecting individuals and social networks through any
broadband device worldwide
Strategy
Market Focus
International long distance
Mobile services
International expansion
Cost Reductions to Fund Growth
Online sales and support
Cost of Telephony Services
Vision |
 Outlook
Build on foundation of successful operational and
financial turnaround to deliver growth in 2011
Strong fourth quarter results
•
Positive net line additions for the first time in more
than two years
•
Churn of 2.4%; lowest 4
th
quarter in four years
•
Expect EBITDA in the $40 million range
Continued improvements expected in 2011
•
Positive net lines
•
Increasing EBITDA from 2010
•
Initiatives expected to begin to meaningfully impact
revenue growth during the second half of 2011
5 |
 6
Non-GAAP Reconciliation
VONAGE HOLDINGS CORP.
RECONCILIATION OF GAAP INCOME (LOSS) FROM OPERATIONS TO
ADJUSTED EBITDA EXCLUDING CERTAIN CHARGES
(Dollars in thousands)
(unaudited)
For the Year-to-Date Periods Ending
Dec 31,
Dec 31,
Dec 31,
Dec 31,
Dec 31,
2005
2006
2007
2008
2009
Reconciliation of Income (Loss) from Operations to
Adjusted EBITDA Excluding Certain Charges:
Income (loss) from
operations.......................................................................................
(264,537)
$
(340,488)
$
(261,780)
$
(6,439)
$
57,202
$
Depreciation and
amortization....................................................................................
11,122
23,677
35,718
48,612
53,391
Non-cash stock
compensation.....................................................................................
15
26,980
7,542
12,238
8,473
Royalty........................................................................................................................
-
51,345
32,606
-
-
IP
Litigation................................................................................................................
-
-
134,300
-
-
Severance....................................................................................................................
-
-
5,242
-
-
Adjusted EBITDA excluding certain
charges...............................................................
(253,400)
$
(238,486)
$
(46,372)
$
54,411
$
119,066
$ |
 |