Attached files
| file | filename |
|---|---|
| EX-99.2 - INVESTOR PRESENTATION - J2 GLOBAL, INC. | exh99-2_17372.htm |
| 8-K - FORM 8K DATED AUGUST 1, 2012 - J2 GLOBAL, INC. | j2form8-k_17372.htm |
EXHIBIT 99.1
j2 Global Reports Second Quarter 2012 Results
Achieves Record Quarterly and Six Month Revenues and
Quarterly and Six Month Free Cash Flows
Increases Quarterly Dividend by 2.3% to $0.22 Per Share
LOS ANGELES - August 1, 2012 - j2 Global, Inc. [NASDAQGS:JCOM] today reported financial results for the second quarter ended June 30, 2012 and announced that its Board of Directors has declared a quarterly cash dividend of $0.22 per share.
j2 achieved several quarterly records, including the following:
|
•
|
Revenues of $89.5 million
|
|
•
|
Earnings Per Diluted Share of $0.67
|
|
•
|
Non-GAAP Earnings Per Diluted Share(1) (2) of $0.70
|
|
•
|
Free Cash Flow(3) of $45.6 million
|
|
•
|
Churn(5) of 2.3%
|
j2 added approximately 33,000 net DIDs in the quarter.
SECOND QUARTER 2012 RESULTS
Revenues increased 4.4% to a quarterly record $89.5 million compared to $85.7 million for Q2 2011.
Earnings per diluted share increased 9.8% to a quarterly record $0.67 compared to $0.61 for Q2 2011.
Non-GAAP earnings per diluted share(1) (2) increased 7.7% to a quarterly record $0.70 compared to $0.65 for Q2 2011.
Free cash flow(3) increased 8.6% to a quarterly record $45.6 million compared to $42.0 million for Q2 2011.
j2 ended the quarter with $206.8 million in cash and investments after deploying, during the quarter, approximately $9.9 million for j2's regular quarterly dividend and approximately $19.8 million to repurchase 826,000 shares of j2 common stock.
Key financial results for second quarter 2012 versus second quarter 2011 are set forth in the following table (in millions, except per share). Reconciliations of Non-GAAP earnings per diluted share and free cash flow to their nearest comparable GAAP financial measures are attached to this Press Release.
|
Q2 2012
|
Q2 2011
|
% Change
|
|
|
Revenues
|
$89.5
|
$85.7
|
4.4%
|
|
Earnings per Diluted Share (4)
|
$0.67
|
$0.61
|
9.8%
|
|
Non-GAAP Earnings per Diluted Share (1) (2)
|
$0.70
|
$0.65
|
7.7%
|
|
Free Cash Flow (3)
|
$45.6
|
$42.0
|
8.6%
|
|
|
(1)
|
|
For Q2 2012, Non-GAAP earnings per diluted share excludes share-based compensation and related payroll taxes, and gain on sale of an investment, in each case net of tax. For Q2 2011, Non-GAAP earnings per diluted share excludes share-based compensation and related payroll taxes and certain acquisition-related integration costs, in each case net of tax.
|
|
(2)
|
The estimated Non-GAAP effective tax rate was approximately 24.1% for Q2 2012 and approximately 25.7% for Q2 2011.
|
||
|
(3)
|
Free cash flow is defined as net cash provided by operating activities less purchases of property, plant and equipment, plus excess tax benefit (deficiency) from share-based compensation.
|
||
|
(4)
|
|
The estimated effective tax rate was approximately 23.6% for Q2 2012 and approximately 25.4% for Q2 2011.
|
|
|
(5)
|
For a definition of churn, please refer to page 17 of our Q2 2012 Investor Presentation available at http://investor.j2global.com and filed with the SEC as Exhibit 99.2 to a Current Report on Form 8-K.
|
||
“Based on this quarter's strong DID growth and record low churn we are reaffirming our earnings guidance for the year even with the added 11 to 13 cents per share interest impact from our recent $250 million bond issuance”, said Hemi Zucker, chief executive officer of j2. "With these additional funds, we now have more than $450 million in cash and investments, expanding the array of opportunities we can pursue to grow our company."
DIVIDEND
j2's Board of Directors has approved a quarterly cash dividend of $0.22 per common share, a 2.3% increase versus last quarter's dividend and a 10% increase versus our first quarterly dividend a year ago. This is j2's fourth consecutive quarterly dividend increase. The dividend will be paid on August 29, 2012 to all shareholders of record as of the close of business on August 13, 2012. Future dividends will be subject to Board approval.
BUSINESS OUTLOOK
j2 is reaffirming its previously issued financial estimates for fiscal 2012 of revenues between $345 and $365 million and Non-GAAP net earnings per diluted share to be approximately the same as for 2011.
It is anticipated that the normalized tax rate for 2012 (exclusive of the release of reserves for uncertain tax positions) will be between 24% and 26%.
About j2
Founded in 1995, j2 Global, Inc. provides cloud services to individuals and businesses around the world. j2's network spans 49 countries on six continents. The Company offers Internet fax, voice and email solutions. j2 Global markets its services principally under the brand names eFax®, Onebox®, eVoice®, FuseMail®, Campaigner®, KeepItSafe® and CampaignerCRM™. As of December 31, 2011, j2 had achieved 16 consecutive fiscal years of revenue growth. For more information about j2, please visit www.j2global.com.
|
Contact:
|
|
|
|
Laura Hinson
|
|
j2 Global, Inc.
|
|
|
800-577-1790
|
|
|
laura.hinson@j2.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 Reform Act of 1995, particularly those contained in the “Business Outlook” portion regarding the Company's expected fiscal 2012 financial performance. 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: subscriber growth and retention; variability of revenue based on changing conditions in particular industries and the economy generally; protection of the Company's proprietary technology or infringement by the Company of intellectual property of others; the risk of adverse changes in the U.S. or international regulatory environments surrounding messaging and communications, including but not limited to the imposition or increase of taxes or regulatory-related fees; 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 2011 Annual Report on Form 10-K filed by j2 Global on February 28, 2012, and the other
reports filed by j2 Global from time-to-time with the SEC, each of which is available at www.sec.gov. The forward-looking statements provided in this press release and particularly those contained in the “Business Outlook” portion regarding the Company's expected fiscal 2012 financial performance are based on limited information available to the Company at this time, which is subject to change. Although management's expectations may change after the date of this press release, the Company undertakes no obligation to revise or update these statements.
j2 GLOBAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED, IN THOUSANDS)
|
JUNE 30,
|
DECEMBER 31,
|
|||||||
|
2012
|
2011
|
|||||||
|
ASSETS
|
||||||||
|
Cash and cash equivalents
|
$ | 142,873 | $ | 139,359 | ||||
|
Short-term investments
|
41,744 | 38,513 | ||||||
|
Accounts receivable,
|
||||||||
|
net of allowances of $4,172 and $3,404, respectively
|
20,242 | 19,071 | ||||||
|
Prepaid expenses and other current assets
|
6,215 | 14,311 | ||||||
|
Deferred income taxes
|
2,151 | 1,643 | ||||||
|
Total current assets
|
213,225 | 212,897 | ||||||
|
Long-term investments
|
22,217 | 43,077 | ||||||
|
Property and equipment, net
|
14,095 | 14,438 | ||||||
|
Goodwill
|
289,259 | 279,016 | ||||||
|
Other purchased intangibles, net
|
101,912 | 98,067 | ||||||
|
Deferred income taxes
|
6,144 | 3,160 | ||||||
|
Other assets
|
2,429 | 516 | ||||||
|
TOTAL ASSETS
|
$ | 649,281 | $ | 651,171 | ||||
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
|
Accounts payable and accrued expenses
|
$ | 26,236 | $ | 24,070 | ||||
|
Income taxes payable
|
3,697 | 1,510 | ||||||
|
Deferred revenue
|
28,366 | 26,695 | ||||||
|
Liability for uncertain tax positions
|
5,523 | 5,523 | ||||||
|
Total current liabilities
|
63,822 | 57,798 | ||||||
|
Liability for uncertain tax positions
|
28,144 | 24,554 | ||||||
|
Deferred income taxes
|
11,305 | 12,102 | ||||||
|
Other long-term liabilities
|
2,500 | 2,342 | ||||||
|
Total liabilities
|
105,771 | 96,796 | ||||||
|
Commitments and contingencies
|
— | — | ||||||
|
Stockholders' Equity:
|
||||||||
|
Preferred stock
|
— | — | ||||||
|
Common stock
|
536 | 554 | ||||||
|
Additional paid-in capital
|
195,538 | 197,374 | ||||||
|
Treasury stock
|
(112,671 | ) | (112,671 | ) | ||||
|
Retained earnings
|
462,658 | 472,595 | ||||||
|
Accumulated other comprehensive loss
|
(2,551 | ) | (3,477 | ) | ||||
|
Total stockholders' equity
|
543,510 | 554,375 | ||||||
|
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
|
$ | 649,281 | $ | 651,171 | ||||
j2 GLOBAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED, IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
|
THREE MONTHS ENDED JUNE 30,
|
SIX MONTHS ENDED JUNE 30,
|
|||||||||||||||
|
2012
|
2011
|
2012
|
2011
|
|||||||||||||
|
Revenues
|
||||||||||||||||
|
Subscriber
|
$ | 88,071 | $ | 85,298 | $ | 172,896 | $ | 158,166 | ||||||||
|
Other
|
1,394 | 378 | 3,221 | 894 | ||||||||||||
|
Total revenues
|
89,465 | 85,676 | 176,117 | 159,060 | ||||||||||||
|
Cost of revenues (including share-based compensation of $192 and $434 for the three and six months of 2012, respectively, and $246 and $490 for the three and six months of 2011, respectively)
|
16,187 | 15,158 | 32,051 | 30,950 | ||||||||||||
|
Gross profit
|
73,278 | 70,518 | 144,066 | 128,110 | ||||||||||||
|
Operating expenses:
|
||||||||||||||||
|
Sales and marketing (including share-based compensation of $352 and $727 for the three and six months of 2012, respectively, and $351 and $699 for the three and six months of 2011, respectively)
|
13,860 | 14,345 | 28,720 | 29,856 | ||||||||||||
|
Research, development and engineering (including share-based compensation of $117 and $233 for the three and six months of 2012, respectively, and $110 and $257 for the three and six months of 2011, respectively)
|
4,617 | 3,837 | 9,106 | 8,609 | ||||||||||||
|
General and administrative (including share-based compensation of $1,494 and $3,054 for the three and six months of 2012, respectively, and $1,524 and $2,990 for the three and six months of 2011, respectively)
|
14,774 | 14,392 | 28,603 | 28,634 | ||||||||||||
|
Total operating expenses
|
33,251 | 32,574 | 66,429 | 67,099 | ||||||||||||
|
Operating earnings
|
40,027 | 37,944 | 77,637 | 61,011 | ||||||||||||
|
Interest and other income (expense), net
|
809 | 299 | 90 | (28 | ) | |||||||||||
|
Earnings before income taxes
|
40,836 | 38,243 | 77,727 | 60,983 | ||||||||||||
|
Provision for income taxes
|
9,648 | 9,729 | 18,000 | 1,534 | ||||||||||||
|
Net earnings
|
$ | 31,188 | $ | 28,514 | $ | 59,727 | $ | 59,449 | ||||||||
|
Basic net earnings per common share
|
$ | 0.68 | $ | 0.63 | $ | 1.28 | $ | 1.31 | ||||||||
|
Diluted net earnings per common share
|
$ | 0.67 | $ | 0.61 | $ | 1.27 | $ | 1.27 | ||||||||
|
Basic weighted average shares outstanding
|
45,373,930 | 45,399,940 | 45,887,185 | 45,247,381 | ||||||||||||
|
Diluted weighted average shares outstanding
|
45,569,564 | 46,723,792 | 46,203,491 | 46,663,866 | ||||||||||||
j2 GLOBAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED, IN THOUSANDS)
|
SIX MONTHS ENDED JUNE 30,
|
||||||||
|
2012
|
2011
|
|||||||
|
Cash flows from operating activities:
|
||||||||
|
Net earnings
|
$ | 59,727 | $ | 59,449 | ||||
|
Adjustments to reconcile net earnings to net cash
|
||||||||
|
provided by operating activities:
|
||||||||
|
Depreciation and amortization
|
10,197 | 10,081 | ||||||
|
Amortization of discount or premium of investments
|
581 | 296 | ||||||
|
Share-based compensation
|
4,425 | 4,436 | ||||||
|
Excess tax benefit from share-based compensation
|
(1,107 | ) | (2,122 | ) | ||||
|
Provision for doubtful accounts
|
2,601 | 2,334 | ||||||
|
Deferred income taxes
|
(3,307 | ) | (59 | ) | ||||
|
Decrease (increase) in:
|
||||||||
|
Accounts receivable
|
(1,313 | ) | (4,833 | ) | ||||
|
Prepaid expenses and other current assets
|
(425 | ) | 3,257 | |||||
|
Other assets
|
(257 | ) | (50 | ) | ||||
|
(Decrease) increase in:
|
||||||||
|
Accounts payable and accrued expenses
|
(2,142 | ) | (553 | ) | ||||
|
Income taxes payable
|
11,903 | 7,632 | ||||||
|
Deferred revenue
|
822 | 10,450 | ||||||
|
Liability for uncertain tax positions
|
3,590 | (10,132 | ) | |||||
|
Other liabilities
|
29 | 365 | ||||||
|
Net cash provided by operating activities
|
85,324 | 80,551 | ||||||
|
Cash flows from investing activities:
|
||||||||
|
Purchase of certificate of deposit
|
(9,157 | ) | — | |||||
|
Sales of available-for-sale investments
|
55,061 | 8,576 | ||||||
|
Purchases of available-for-sale investments
|
(28,242 | ) | (28,542 | ) | ||||
|
Purchases of property and equipment
|
(2,790 | ) | (2,481 | ) | ||||
|
Purchases of intangible assets
|
(2,745 | ) | (1,860 | ) | ||||
|
Acquisition of businesses, net of cash received
|
(18,843 | ) | 1,260 | |||||
|
Net cash used in investing activities
|
(6,716 | ) | (23,047 | ) | ||||
|
Cash flows from financing activities:
|
||||||||
|
Repurchases of common stock and restricted stock
|
(60,224 | ) | (1,243 | ) | ||||
|
Issuance of common stock under employee stock purchase plan
|
61 | 77 | ||||||
|
Exercise of stock options
|
2,991 | 5,617 | ||||||
|
Excess tax benefit from share-based compensation
|
1,107 | 2,122 | ||||||
|
Dividends paid
|
(19,901 | ) | — | |||||
|
Debt issuance costs
|
(77 | ) | — | |||||
|
Net cash (used in) provided by financing activities
|
(76,043 | ) | 6,573 | |||||
|
Effect of exchange rate changes on cash and cash equivalents
|
949 | 878 | ||||||
|
Net increase in cash and cash equivalents
|
3,514 | 64,955 | ||||||
|
Cash and cash equivalents at beginning of period
|
139,359 | 64,752 | ||||||
|
Cash and cash equivalents at end of period
|
$ | 142,873 | $ | 129,707 | ||||
j2 GLOBAL, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
THREE MONTHS ENDED JUNE 30, 2012 AND 2011
(UNAUDITED, IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
Non-GAAP net earnings are GAAP net earnings with the following modifications: (1) elimination of share-based compensation expense and the associated payroll taxes; (2) elimination of certain acquisition and related exit costs; (3) elimination of gain on sale of certain investment and (4) elimination of income tax provision associated with shared-based compensation and associated payroll taxes, certain acquisition and related exit costs and gain on sale of certain investment.
|
THREE MONTHS ENDED JUNE 30, 2012
|
THREE MONTHS ENDED JUNE 30, 2011
|
|||||||||||||||||||||||||||||||
| (3) | (2) | |||||||||||||||||||||||||||||||
| (1) |
Gain on
|
(1) |
Acquisition
|
|||||||||||||||||||||||||||||
|
Share-based
|
Sale of
|
Non- |
Share-based
|
and Exit
|
Non- | |||||||||||||||||||||||||||
|
GAAP
|
Compensation
|
Investment
|
GAAP
|
GAAP
|
Compensation
|
Costs
|
GAAP
|
|||||||||||||||||||||||||
|
Cost of revenues
|
16,187 | (192 | ) | — | 15,995 | 15,158 | (246 | ) | (18 | ) | 14,894 | |||||||||||||||||||||
|
Operating expenses:
|
||||||||||||||||||||||||||||||||
|
Sales and marketing
|
13,860 | (352 | ) | — | 13,508 | 14,345 | (351 | ) | (24 | ) | 13,970 | |||||||||||||||||||||
|
Research, development and engineering
|
4,617 | (117 | ) | — | 4,500 | 3,837 | (110 | ) | (28 | ) | 3,699 | |||||||||||||||||||||
|
General and administrative
|
14,774 | (1,500 | ) | — | 13,274 | 14,392 | (1,545 | ) | (589 | ) | 12,258 | |||||||||||||||||||||
|
Interest and other income (expense)
|
809 | — | (180 | ) | 629 | 299 | — | — | 299 | |||||||||||||||||||||||
|
Income tax provision (4)
|
$ | 9,648 | 710 | (43 | ) | $ | 10,315 | $ | 9,729 | 695 | 167 | 10,591 | ||||||||||||||||||||
|
Net earnings
|
$ | 31,188 | 1,451 | (137 | ) | $ | 32,502 | $ | 28,514 | 1,557 | 492 | $ | 30,563 | |||||||||||||||||||
|
Net earnings per share*:
|
||||||||||||||||||||||||||||||||
|
Basic
|
$ | 0.68 | 0.03 | 0.00 | $ | 0.71 | $ | 0.63 | 0.03 | 0.01 | $ | 0.67 | ||||||||||||||||||||
|
Diluted
|
$ | 0.67 | 0.03 | 0.00 | $ | 0.70 | $ | 0.61 | 0.03 | 0.01 | $ | 0.65 | ||||||||||||||||||||
* The reconciliation of Net earnings per share from GAAP to Non-GAAP may not foot due to rounding.
The Company discloses non-GAAP Earnings Per Share (EPS) as supplemental non-GAAP financial performance measure, as it believes it is useful metric by which to compare the performance of its business from period to period. The Company also understands that this non-GAAP measure is broadly used by analysts, rating agencies and investors in assessing the Company's performance. Accordingly, the Company believes that the presentation of this non-GAAP financial measure provides useful information
to investors.
Non-GAAP EPS is not in accordance with, or an alternative to, Earnings Per Share and may be different from non-GAAP measures with similar or even identical names used by other companies. In addition, this non-GAAP measure is not based on any comprehensive set of accounting rules or principles. This non-GAAP measure has limitations in that they do not reflect all of the amounts associated with the Company's results of operations determined in accordance with GAAP.
j2 GLOBAL, INC.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
SIX MONTHS ENDED JUNE 30, 2012 AND 2011
(UNAUDITED, IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
Non-GAAP net earnings are GAAP net earnings with the following modifications: (1) elimination of the impact to revenues resulting from a change in estimate of deferred revenue; (2) elimination of share-based compensation expense and the associated payroll taxes; (3) elimination of certain acquisition and related exit costs; (4) elimination of gain on sale of certain investment; (5) elimination of a change to our liability of uncertain tax position due to expiration of statues of limitations and (6) elimination of income tax provision associated with
change in estimate of deferred revenue, share-based compensation and associated payroll taxes, certain acquisition and related exit costs and gain on sale of certain investment.
|
SIX MONTHS ENDED JUNE 30, 2012
|
SIX MONTHS ENDED JUNE 30, 2011
|
|||||||||||||||||||||||||||||||||||||||||||
| (1) | ||||||||||||||||||||||||||||||||||||||||||||
| (3) | (4) |
Change in
|
(3) | (5) | ||||||||||||||||||||||||||||||||||||||||
| (2) |
Acquisition
|
Gain on
|
Estimate of
|
(2) |
Acquisition
|
Uncertain
|
|
|||||||||||||||||||||||||||||||||||||
|
Share-based
|
and Exit
|
Sale of
|
Non- |
Deferred
|
Share-based
|
and Exit
|
Tax
|
Non- | ||||||||||||||||||||||||||||||||||||
|
GAAP
|
Compensation
|
Costs
|
Investment
|
GAAP
|
GAAP
|
Revenue
|
Compensation
|
Costs
|
Position
|
GAAP
|
||||||||||||||||||||||||||||||||||
|
Revenues:
|
||||||||||||||||||||||||||||||||||||||||||||
|
Subscriber
|
$ | 172,896 | — | — | — | $ | 172,896 | $ | 158,166 | $ | 10,325 | — | — | — | $ | 168,491 | ||||||||||||||||||||||||||||
|
Cost of revenues
|
32,051 | (434 | ) | (6 | ) | — | 31,611 | 30,950 | — | (496 | ) | (339 | ) | — | 30,115 | |||||||||||||||||||||||||||||
|
Operating expenses:
|
||||||||||||||||||||||||||||||||||||||||||||
|
Sales and marketing
|
28,720 | (727 | ) | (90 | ) | — | 27,903 | 29,856 | — | (705 | ) | (764 | ) | — | 28,387 | |||||||||||||||||||||||||||||
|
Research, development and engineering
|
9,106 | (233 | ) | (5 | ) | — | 8,868 | 8,609 | — | (262 | ) | (663 | ) | — | 7,684 | |||||||||||||||||||||||||||||
|
General and administrative
|
28,603 | (3,130 | ) | (48 | ) | — | 25,425 | 28,634 | — | (3,042 | ) | (1,404 | ) | — | 24,188 | |||||||||||||||||||||||||||||
|
Interest and other income (expense)
|
90 | — | — | (180 | ) | (90 | ) | (28 | ) | — | — | — | — | (28 | ) | |||||||||||||||||||||||||||||
|
Income tax provision (6)
|
18,000 | 1,443 | 34 | (43 | ) | 19,434 | 1,534 | 2,707 | 1,377 | 815 | 14,059 | 20,492 | ||||||||||||||||||||||||||||||||
|
Net earnings
|
$ | 59,727 | 3,081 | 115 | (137 | ) | $ | 62,786 | $ | 59,449 | 7,618 | 3,128 | 2,355 | (14,059 | ) | $ | 58,491 | |||||||||||||||||||||||||||
|
Net earnings per share*:
|
||||||||||||||||||||||||||||||||||||||||||||
|
Basic
|
$ | 1.28 | 0.07 | 0.00 | 0.00 | $ | 1.35 | $ | 1.31 | 0.17 | 0.07 | 0.05 | (0.31 | ) | $ | 1.29 | ||||||||||||||||||||||||||||
|
Diluted
|
$ | 1.27 | 0.07 | 0.00 | 0.00 | $ | 1.34 | $ | 1.27 | 0.16 | 0.07 | 0.05 | (0.30 | ) | $ | 1.25 | ||||||||||||||||||||||||||||
* The reconciliation of Net earnings per share from GAAP to Non-GAAP may not foot due to rounding.
The Company discloses non-GAAP Earnings Per Share (EPS) as supplemental non-GAAP financial performance measure, as it believes it is useful metric by which to compare the performance of its business from period to period. The Company also understands that this non-GAAP measure is broadly used by analysts, rating agencies and investors in assessing the Company's performance. Accordingly, the Company believes that the presentation of this non-GAAP financial measure provides useful information
to investors.
Non-GAAP EPS is not in accordance with, or an alternative to, Earnings Per Share and may be different from non-GAAP measures with similar or even identical names used by other companies. In addition, this non-GAAP measure is not based on any comprehensive set of accounting rules or principles. This non-GAAP measure has limitations in that they do not reflect all of the amounts associated with the Company's results of operations determined in accordance with GAAP.
j2 GLOBAL, INC.
NON-GAAP FINANCIAL MEASURES
(UNAUDITED, IN THOUSANDS)
| Q1 | Q2 | Q3 | Q4 |
YTD
|
||||||||||||||||
|
2012
|
||||||||||||||||||||
|
Net cash provided by operating activities
|
$ | 38,942 | $ | 46,382 | $ | 85,324 | ||||||||||||||
|
Less: Purchases of property and equipment
|
(1,159 | ) | (1,631 | ) | (2,790 | ) | ||||||||||||||
|
Add: Excess tax benefit from share-based compensation
|
286 | 821 | 1,107 | |||||||||||||||||
|
Free cash flows
|
$ | 38,069 | $ | 45,572 | $ | — | $ | — | $ | 83,641 | ||||||||||
|
2011
|
||||||||||||||||||||
|
Net cash provided by operating activities
|
$ | 38,153 | $ | 42,398 | $ | 28,682 | $ | 41,515 | $ | 150,748 | ||||||||||
|
Less: Purchases of property and equipment
|
(625 | ) | (1,860 | ) | (2,590 | ) | (1,769 | ) | (6,844 | ) | ||||||||||
|
Add: Excess tax benefit from share-based compensation
|
679 | 1,443 | 11,124 | 315 | 13,561 | |||||||||||||||
|
Free cash flows
|
$ | 38,207 | $ | 41,981 | $ | 37,216 | $ | 40,061 | $ | 157,465 | ||||||||||
The Company discloses non-GAAP Free Cash Flows as supplemental non-GAAP financial performance measure, as it believes it is a useful metrics by which to compare the performance of its business from period to period. The Company also understands that this non-GAAP measure is broadly used by analysts, rating agencies and investors in assessing the Company's performance. Accordingly, the Company believes that the presentation of this non-GAAP financial measure provides
useful information to investors.
Free Cash Flows is not in accordance with, or an alternative to, Cash Flows from Operating Activities, and may be different from non-GAAP measures with similar or even identical names used by other companies. In addition, the non-GAAP measure is not based n any comprehensive set of accounting rules or principles. This non-GAAP measure has limitations in that it do not reflect all of the amounts associated with the Company's results of operations determined in accordance
with GAAP.