Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Spok Holdings, Inc | d353535d8k.htm |
 Exhibit 99.1 |
 Safe
Harbor Statement This presentation may include forward-looking statements
that are subject to risks and uncertainties relating to USA Mobility’s
future financial and business performance. Such statements may include
estimates of revenue, expenses, and income, as well as other predictive
statements or plans which are dependent upon future events or conditions. These
statements represent the Company’s estimates only on the date of this
presentation and are not intended to give any assurance as to actual future
results. USA Mobility’s actual results could differ materially from
those anticipated in these forward-looking statements. Although these
statements are based upon assumptions that the Company believes to be reasonable,
based upon available information, they are subject to risks and uncertainties.
Please review the risk factors section relating to our operations and the
business environment in which we compete, contained in our 2011 Form
10-K and related Company documents filed with the Securities and
Exchange Commission, for a description of these risks and uncertainties.
Please note that USA Mobility assumes no obligation to update any
forward-looking statements from past or present filings and conference
calls. 2 |
 2011
Strategic Assessment Wireless -
business is extremely profitable, but continues to decline as
paging users migrate to newer technologies
–
Cash flow margin once again expanded in 2011
–
However, paging subscribers, revenue and cash flow declined
–
The rate of decline slowed, but the trajectory remains downward
–
Paging will throw off significant cash flow for years
–
Cash flow per share from paging will decline each year
–
We have large Deferred Tax Assets (DTAs)
Software -
repositioned for future growth with the Amcom acquisition
–
Attractive Software business model, focused on our core segments
–
Positive demographics, long term business potential
–
Unlocked significant value in our DTAs
3 |
 Managing Our Wireless Business
•
Faced with declining subscribers and revenue, we have met enormous challenges
with respect to managing the Wireless business creating efficiencies
•
For the past six years annual operating expenses have been reduced at a higher
rate than our rate of annual revenue decline
•
We have produced significant free cash flow, expanded our margins EVERY year
since 2005 and planned for the future
4
*Operating
Cash
Flow
(OCF)
excludes
Depreciation,
Amortization
&
Accretion;
Goodwill
Impairment;
includes
Capital
Expense
and
transaction
costs.
**Operating Expense excludes Depreciation, Amortization & Accretion; Goodwill Impairment
and includes transaction costs. Revenue Reduction
Operating Expense** Reduction Operating Cash Flow*
Revenue (Millions) |
  Driving
Solid Performance – 2011 Highlights
5
*Revenues include maintenance revenue write-down related to purchase accounting
adjustments. **Operating Expenses exclude Depreciation, Amortization &
Accretion and include transaction costs. 2011
(Millions)
From
To
Results
Revenues*
Software
42.0
$
48.0
$
43.2
$
Wireless
193.0
200.0
199.7
Total
235.0
$
248.0
$
242.9
$
Operating Expenses**
Software
40.0
$
35.0
$
38.6
$
Wireless
134.0
127.0
125.3
Total
174.0
$
162.0
$
163.9
$
Capital Expenditures
Software
1.0
$
0.5
$
0.2
$
Wireless
8.0
6.0
7.8
Total
9.0
$
6.5
$
8.0
$
Guidance Range |
 Driving Solid Performance –
2011 Highlights
Wireless
–
Annual subscriber churn rate improved for second year in a row from 22.5%
for 2009 to 13.4% for 2010 and 11.7% for 2011 –
lowest in Company’s
history
–
Year-over-year rate of revenue decline was 14.4% in 2011 compared to
19.5% in 2010
Software
–
On a pro forma full year comparable basis (excluding purchase accounting
adjustments) revenue increased 11.2% in 2011 over 2010; $56.7 million vs.
$51.0 million
–
Q4
Total
Bookings
(including
Maintenance
renewals)
were
the
best
of
the
year at $15.2 million
–
December Operations Bookings were the best month of the stub period at
$3.8 million. Best single month in the history of the Software company
6 |
 Driving Solid Performance –
2011 Highlights
On a consolidated basis, 29 cents of every dollar of revenue generated in
2011 turned into profit generating sufficient cash flow to:
7
Return $22.1 million in capital to stockholders in the form of dividends;
$1.00/share for the year
Repay $23.7 million of the $51.9 million bank debt incurred for Amcom
transaction
End 2011 with $53.7 million cash in the bank
Net debt free on a cash basis at YE 2011 (debt free currently)
|
 Repositioning for Future Growth
Amcom Software Acquisition in March 2011
–
Demonstrates our long-term commitment to new and existing customers
–
Provides a long-term revenue and cash flow stream for our shareholders
–
New product sales into our valuable market segments
–
Expansion via internal R&D
–
Select add-on acquisitions
–
Increased
the
future
recoverability
of
the
DTAs
by
$32.4
million
in
2011
8
Capitalizes
on
our
valuable
franchise
in
core
markets
–
Healthcare,
Government, and Large Enterprise
Creates a growth platform for continued value creation through:
Unlocks more value of our existing DTAs |
 Achieving Solid Long-Term Performance
•
We delivered on our plan through
2011
•
We have started the process to
capitalize on our strengths to
reposition for long-term growth
with the Amcom acquisition
•
We will continue that process in
2012 which will require changes in
approach but not in our continued
goal to increase shareholder value
9
*Actual cash invested exclusive of debt.
(Millions)
Create long-term value & return
excess capital to shareholders |
 10
Long-Term Growth Strategy
Cross sell + expand S&M resources
Further Penetrate Existing Markets with
New Product Development
Expand International Presence
Pursue Highly Targeted
Acquisitions
Market Expansion |
 •
•
•
•
•
11
Our Changing Marketplace and Approach
Our Changing Marketplace and Approach
Cross-selling
opportunities
and
collaboration
create
value
for
all
stakeholders
–
Customers
–
the
Company
–
Shareholders
–
and
are
integral
to
our
sales
strategy
and
execution
Impact
Achieves Results
Increase new logo
business
Retain and grow
base business
Keep revenue “All in
the Family”
Path to Company
growth and Long
Term Shareholder
Value |
 12
Leads
Sales Referrals, Key Account
Manager Referrals, Webinar
Registrants
Collaboration among
Sales orgs
“At-bats”
into sales
pipeline
Collaboration
Driving Wireless Customers to Amcom |
 13
•
Includes tracking leads and passing
to appropriate sales representatives
Virtual Cross Selling
Web Sites Direct Visitors Accordingly |
 Hospitals Today: Communications Challenged
14 |
 15
Hospitals Need Solutions to Improve Quality of Care
and Patient Safety
•
Inadequate communication is the main
cause
of
sentinel
events
in
hospitals
(1)
•
Amcom customer experiences
illustrate need for rapid, more
automated communications
–
Lack of coordinated response to patients
in distress
–
Difficulty reaching the appropriate
clinician
–
Inaccurate on-call schedules contribute
to improper contacts
–
Slow caregiver response to aid requests
Communications
Patient Assessment
Leadership
Procedural Compliance
Competency/Credentialing
Environmental
Safety/Security
Orientation/Training
Availability of Information
Care Planning
Organization Culture
Staffing
Continuum of Care
% of Deaths and Serious Injuries
Impacted by Issue
0%
20%
40%
60%
80%
(1) Improving America’s Hospitals: The Joint Commission’s Annual Report on Quality
and Safety 2007 |
 Amcom
Solutions Solve Critical Communications Challenges
16
Operator Console
Console
Web Directory,
On Call, Hours Tracking
Web Portal
Smartphone &
Tablet Messaging
Amcom Mobile
Connect
Emergency
Notification
e.Notify
Mobile Event
Notification
Amcom
Messenger
Speech Recognition
Speech
Solutions
Call Center Quality
Amcom Call
Recording
Call Accounting
Eclipse
E911
Enhanced 911
Solutions
Connecting Correctly
Amcom Care
Connect |
 Care Connect
Who wants to connect?
Time of day
Day of week
What is the priority of
the message?
What is my
Preferred device?
What is my status?
Why do they want to
connect?
Who:
Dr. Elray
For:
Urgent
Consult Request
TOD
/
DOW:
8:50
AM, Wednesday
Status: In
Surgery Priority:
Urgent
(Urgent Consult
Request)
Preferred
Communication:
Mobile Call
Giving physicians control over their communication process
17 |
 Expand International Presence
18
•
Offices in Australia,
UK, Netherlands
and
Dubai (soon)
•
16% of Software
revenue in 2012 comes
from outside of the U.S.
–
Strong presence in
Australia
–
Growing presence in
the Middle East,
Europe and Asia
•
Pursuing
international
opportunities
where
they
make
sense
given
our
existing resources and talent |
 •
Disciplined approach that focuses on targeted applications areas
•
We investigate potential acquisition targets where we believe that a buy is
advantageous versus an internal build effort
–
Time to market
–
Reasonable valuation expectations
–
Domain and technology expertise
•
Based on these criteria we have identified a pipeline of possibilities that we are
investigating for possible acquisitions
•
IMCO acquisition demonstrates execution of our M&A strategy
–
Addition of critical test results management enables us to offer
more
communication solutions in clinical settings, a focal point of our strategy
M&A Strategy Approach
19 |
 IMCO
Acquisition = Amcom Critical Test Results •
Acquisition allows faster time to market for vital
clinical customer need at cost efficient investment
•
•
Helps to address Joint Commission's National
Patient Safety Goal Requirements regarding
timely delivery of critical test results
–
This is the #2 on their list of patient safety goals
–
Speeds workflow, reduces litigation exposure
and cost of regulatory compliance
•
We will integrate this solution with Amcom's suite
of communication workflow solutions including
smartphone messaging
–
Supports traceable, closed-loop test results
information that empowers physicians to
provide better care for their patients
20 |
 Strategy Implementation –
Capital Allocation
Reviewing capital allocation based upon:
–
The realities of cash flow from our Wireless business
–
The need for strategic capital to grow our Software business
–
The ability to unlock further value from our DTAs
Considerations:
–
Maintain a significant current yield on our common stock
–
Establish a revised dividend rate that is sustainable over several years
–
Provide strategic capital to pursue potential acquisitions
–
Continue review of our stock repurchase plan
21 |
 |