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8-K - GLOBAL TELECOM & TECHNOLOGY, INC. 8-K - GTT Communications, Inc. | a50132279.htm |
EXHIBIT 99
The Fourteenth Annual Needham Growth Conference January 10-12th, 2012, New York City Clean Technologies Communications Consumer Enterprise Infrastructure Healthcare Industrial & Diversified Growth | Semiconductors & Equipment | Software & Services The Leading Growth Company Focused Investment Bank for 27 Years Global Telecom and Technology, Inc.
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential This presentation may contain “Forward-Looking Statements”
within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. All statements other
than statements of historical facts made in this presentation regarding
the prospects of our industry and our prospects, plans, financial
position and business strategy may constitute forward-looking
statements. These statements are based upon management’s current beliefs
or expectations and are inherently subject to significant business,
economic and competitive risks, uncertainties, and contingencies, many
of which are beyond our control. Undue reliance should not be placed on
such statements. We caution you that forward-looking statements are not
guarantees of future performance and that actual results of operations,
financial condition and liquidity, and developments in the industry, may
differ materially from those made in or suggested by any forward-looking
statements contained in this presentation. Such forward-looking
statements involve known and unknown risks, uncertainties, assumptions,
and other factors which may cause the company’s actual results,
performance or achievements to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements. Factors and risks that could cause actual
results to differ materially from our expectations are described in the
most recent Global Telecom and Technology Forms 10-Q and 10-K, on file
with the SEC. (www.sec.gov) The forward-looking statements in this
presentation speak only as of the date of this presentation and might
not occur in light of these risks, uncertainties, assumptions, and other
factors. We undertake no obligation and disclaim any obligation to
publicly update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Disclaimer
Copyright ® 2011
Global Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential GTT is a global telecom carrier delivering network services
to large enterprise, government and carrier clients in over 80 countries
worldwide Expanding Market for Data and Cloud Connectivity Global
Platform Deep Expertise and Proven Success GTT Company
Overview 3
Copyright ® 2011
Global Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential •$241B cloud computing marketplace by 2020 (Forrester:
‘Sizing The Cloud’ April 2011) •Current Global Wireline Data market
estimated at ~$250B per annum (IDC World Wide Telecommunications
Services Database 2H09)•US enterprise to spend $44B on Ethernet services
in next 5 years (Insight Research: Carriers and Ethernet Services:
Public Ethernet in Metro & Wide Area Networks, 2011-2016) Key Market
Trends 4
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential GTT ‘Network as a Service’ •800 global suppliers and peers
Extensive database of building-level bandwidth availability No
geographic limitations Single Contract for multi-vendor solutions Global
Project Management End to end solution management via 24/7 NOC/Portal
Global layer-2 switched Ethernet mesh Performance IP Internet Access
100+ PoPs across North America, Europe, Asia 5
C yright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential Cloud Computing ‘Stack’ Software as a Service (SaaS)
Platform as a Service (PaaS) Infrastructure as a Service (IaaS)
Applications On demand basic infrastructure i.e. servers or storage
Intelligent infrastructure Cloud Computing takes different forms – each
slice of the stack has its own players. All players make their cloud
based services available for access online. CIO’s seek to access the
utilities in a way that allows them to be readily available and fit for
purpose, ensuring they appear ‘local’ to the user. Mission critical
applications demand connectivity that has high performance, robust SLA’s
and is secure. GTT ‘Network as a Service’- Cloud Connectivity
Opportunity C loud Delivery Network N etwork as a Service 6
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential Private Data Centre Partner Offices Public Data Centre
Branch Office Head Office Public Utilities Single tail circuit combining
layer 2 and Internet access Private Layer 2 Ethernet Public Internet GTT
allows customer to select the cloud services that are best fit by making
connectivity ubiquitous Maximum flexibility for Public, Private and
Hybrid cloud solutions Optimizing application performance and security
where ever possible Cloud Delivery Network GTT ‘Network as a Service’-
Cloud Solutions 7
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential Proven Performance Over 1,200 blue chip clients in
Wholesale and Enterprise & Government markets Enterprise and Government
Wholesale Plus global leaders in: Auto Manufacturing Global Consulting
Global Finance Government Agencies Plus Leading Providers of: Web-based
SAAS providers Global Financial Information and Trading Government
Solutions Internet Content Delivery Wireless Services and Cable
Television 8
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential 9 Accelerating Financial Results Dollars in $000 1 2009
adversely impacted by foreign exchange rate fluctuation and its effect
on translation of EUR and GPB denominated revenue to GTT’s functional
reporting currency (USD) 2Non GAAP measure. Equivalent to: Operating
Income excluding Depreciation, Amortization and Non-Cash Compensation
costs 32011 Estimate based on YTD 9/30/2011 plus run-rate estimate for
Q4 2011 Adjusted EBITDA 2, 3 Revenue 3
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential 10 GTT Growth Strategy •Grow Both Organically and Through
Acquisition Focus on Data Telecom Services Focus on Large
Enterprise/Government and Wholesale Clients Expand GTT Network Assets
Dollars in $000
Copyright ® 2011
Global Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential 11 Attractive Valuation and Credit Statistics 1Book value
including unamortized debt discount, face value $30.765M 2Treasury
method at trading price as of 12/21/2011 Dollars in $millions (except
for share price) Leverage Ratio below 2.5x Net Debt / EBITDA Trading
multiple below 5.0x EBITDA and Unlevered Free Cash Flow Pay-down of debt
from Unlevered Free Cash Flow is accretive to equity Improving 4th
quarter and 2012 results
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential 12 Efficient, Profitable, Sustainable Business Model High
proportion of incremental Gross Margin and EBITDA flows to Net Income
and Unlevered Free Cash Flow Growing Revenue Increasing Margins Low
capital intensity –Growing revenue of 13% CAGR since 2007 –Services
contracted with terms staggered over 1-3 years –Historical Churn-rate of
2.0-2.5% –Contract diversity with 68% US, 32% Europe over 1000+ clients
–Increasing deployment of owned network assets –30% Gross Margin, 11%
EBITDA margin at Q3 2011 –SG&A at 19% of revenue and declining –Over $1M
of annual revenue per employee (94 Headcount) –Low Debt Required –Capex
averages ~0.5% of revenue –Annual capital expenditures +/- $1M –Net Debt
at 2.3x EBITDA High proportion of incremental Gross Margin and EBITDA
flows to Net Income and Unlevered Free Cash Flow
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential Proven Platform for consolidation –Successfully integrated
prior acquisitions –CMD platform (operating platform) enables rapid and
deep synergy realizations –Objective to drive cost synergy realization
in 1-2 quarters Large M&A pipeline –Represent $355 million of aggregate
revenue –11 US based, 5 International –Add strategic network assets,
clients and geographic presence 13 M&A Strategy GII and ETT Acquired by
Mercator Partners in October 2006 to create GTT Integrated into single
public company by existing management in 2007 Re-ignited organic sales
growth and drove positive EBITDA by Q3 ‘07 Demonstrated Success WBS
Connect 400 clients and network in 50 cities Expanded data service
portfolio (Ethernet, IP) Accretive transaction (3-4X post synergy
multiple) Packet Exchange 485 clients, ~$20MM annual revenue Expanded
network depth and breadth (Core Switching, Asia and Europe POP’s)
Accretive transaction, fully debt -financed
Copyright ® 2011 Global
Telecom & Technology, Inc. All Rights Reserved. www.gt-t.net GTT
Confidential 14 Investment Summary Global company providing ‘Network as
a Service’ to large and growing market –IP Network serving 100+ points
of presence in North America, Europe and Asia –Global network of 800+
off-net suppliers and peers –1,200 large enterprise and wholesale
clients –$250 Billion wire-line data market driven by Cloud Computing
and IP Content Proven growth and bottom-line performance –Revenue
run-rate over $100M with 13% CAGR since 2007 –EBITDA run-rate over $10M
with 67% CAGR since 2008 Dual-pronged growth strategy –Proven M&A and
integration success –‘Network as a Service’ philosophy serves
Cloud-Connectivity needs Attractive Financial Metrics –High conversion
of EBITDA to Cash Flow –Net leverage < 2.5x EBITDA –Trading Value
implies Enterprise Value <5.0x EBITDA
The Fourteenth Annual Needham Growth Conference January 10-12th, 2012, New York City | Clean Technologies | Communications | Consumer | Enterprise Infrastructure | Healthcare | | Industrial & Diversified Growth | Semiconductors & Equipment | Software & Services | The Leading Growth Company Focused Investment Bank for 27 Global Telecom and Technology, Inc.