Press Release Archive
Premiere Global Reports Fourth Quarter and 2006 Results
$127.1M in Revenues, $32.3M in Cash Flows Provided by Operating Activities from Continuing Operations, $0.17 Pro Forma Diluted EPS from Continuing Operations*in Q4
Feb 22, 2007
ATLANTA, GA, February 22, 2007 - Premiere Global Services, Inc. (NYSE: PGI), a global provider of on-demand business communication solutions, today announced results for the fourth quarter and year ended December 31, 2006.
Revenues in the fourth quarter of 2006 increased 8.4% to $127.1 million compared to $117.2 million in the fourth quarter of 2005. Excluding revenue from legacy broadcast fax in both periods, aggregate revenues from the Company’s six core solution sets increased 16.0%.*
Revenue from Conferencing solutions grew 23.3% to $75.5 million in the fourth quarter of 2006 compared to $61.2 million in the comparable prior year quarter. Revenue from legacy broadcast fax services totaled $20.2 million in the fourth quarter of 2006, a decline of $4.9 million as compared to $25.1 million in the fourth quarter of 2005. Legacy broadcast fax represented 15.9% of consolidated revenues in the fourth quarter of 2006, as compared to 21.4% of consolidated revenues in the comparable prior year quarter.
In the fourth quarter of 2006 in accordance with GAAP, operating income totaled $6.4 million, income from continuing operations totaled $5.1 million and diluted EPS from continuing operations totaled $0.08, compared to $12.5 million, $12.5 million and $0.17, respectively, in the fourth quarter of 2005. These results include the following items on a pre-tax basis: $4.4 million of restructuring costs, a $0.1 million asset impairment, proxy-related costs of $0.1 million, $0.6 million in net legal settlements and related expenses, $2.5 million of equity-based compensation and $3.5 million of amortization.
Pro Forma Earnings
In the fourth quarter of 2006, excluding restructuring costs, asset impairments, proxy-related costs, net legal settlements and related expenses, the elimination of certain income tax adjustments, equity based compensation and amortization charges, pro forma diluted EPS from continuing operations totaled $0.17. *
The Company believes it made measurable progress against its primary objectives in 2006. Specifically, during the year PGI:
- + Consolidated management of its former Conferencing & Collaboration and Data Communications business units under its One Company theme;
- + Aligned the Company’s operations under a newly appointed President, Ted Schrafft, who reports directly to the CEO;
- + Refined its market strategy to focus on six core solution sets – Conferencing, Desktop Fax, Document Delivery, Accounts Receivable Management, Notifications and Reminders and eMarketing;
- + Launched micro-sites for online customer self-service, provisioning, support and account management, with nearly 6,000 enterprise customers and nearly 13,000 active users today;
- + Began development of a new universal Web portal to bring all of PGI’s capabilities online;
- + Proactively managed a $25.2 million revenue loss from its legacy broadcast fax business;
- + Grew Conferencing solutions revenue 11.2% year-over-year, despite a $17.3 million decline in revenue from its largest Conferencing customer;
- + Expanded its credit facility to $300 million to augment its access to capital;
- + Repurchased nearly 3.9 million shares, or greater than 5% of its total shares outstanding, in the open market; and
- + Secured Board authorization for a new share repurchase plan for up to 7 million shares, or approximately 10% of total shares outstanding.
“2006 was a milestone year for PGI, as we largely completed our evolution to One Company – a process that we began more than two years ago,” said Boland T. Jones, Founder, Chairman and CEO of Premiere Global Services, Inc. “Today, as a unified Company, we can more fully deliver on the promise of an on-demand Communications Operating System for enterprise customers around the world.”
Revenues for the year ended December 31, 2006 were $496.5 million, compared to $497.5 million in the year ended December 31, 2005. In 2006 in accordance with GAAP, operating income totaled $46.4 million, income from continuing operations totaled $25.5 million and diluted EPS from continuing operations totaled $0.37, versus $75.3 million, $48.7 million and $0.67, respectively, in 2005. In 2006, excluding restructuring costs, asset impairments, proxy-related costs, net legal settlements, the elimination of certain income tax adjustments, equity based compensation and amortization charges, pro forma diluted EPS from continuing operations totaled $0.68. *
Change in Segment Reporting
Beginning in the fourth quarter of 2006, the Company has realigned its reporting segments to be consistent with the way it is now managing its operations on a geographic regional basis, with reportable segments in North America, Europe and Asia Pacific. The Company will no longer report results under its former Conferencing & Collaboration and Data Communications segments, consistent with the completion of its One Company initiative.
The following statements are based on Premiere Global Services’ current expectations as of February 22, 2007. These statements contain forward-looking statements and Company estimates, and actual results may differ materially. The Company assumes no duty to update any forward-looking statements made in this press release. A discussion concerning forward-looking statements is included at the end of this press release and in the Company’s filings with the Securities and Exchange Commission.
The Company reaffirms its financial outlook for 2007 as previously provided in its release dated December 5, 2006, as follows:
The Company expects consolidated revenues to increase 5% to 7% in 2007 from 2006 totals.
As a result of expected operating efficiencies from the Company’s initiatives to increase automation, to streamline service delivery and to consolidate its operations, earnings are projected to grow at a faster rate than revenues in 2007.
Cash Flows and Other
The Company anticipates cash flows provided by operating activities from continuing operations to grow approximately 20% in 2007 from 2006 totals. Capital expenditures are expected to be in the range of 6.5% to 7.0% of revenues due to increased investment in automation initiatives, including the development of PGI’s new Web portal designed to bring the Company’s products and services online. The Company anticipates its effective tax rate to remain in the range of 34% to 35%.
* To supplement the Company’s consolidated financial statements presented in accordance with GAAP, we have included the following non-GAAP measures of financial performance: pro forma operating income, pro forma income from continuing operations, pro forma diluted EPS from continuing operations and normalized cash provided by operating activities from continuing operations. Management uses these measures internally as a means of analyzing the Company’s current and future financial performance and identifying trends in our financial condition and results of operations. We have provided this information to investors to assist in meaningful comparisons of past, present and future operating results and to assist in highlighting the results of ongoing core operations. In addition, we present certain consolidated and solution revenue growth statistics that are derived from non-GAAP financial measures. Please see the tables attached for calculation of these non-GAAP financial measures and for reconciliation to the most directly comparable GAAP measures. These non-GAAP financial measures may differ materially from comparable or similarly titled measures provided by other companies and should be considered in addition to, not as a substitute for or superior to, measures of financial performance prepared in accordance with GAAP.
The Company will hold a conference call at 5:00 p.m. Eastern this afternoon to discuss these results. To participate in the call, please dial-in to the appropriate number 5-10 minutes prior to the scheduled start time: (800) 289-0726 (US & Canada) or (913) 981-5545 (International). The conference call will be simultaneously broadcast over the Internet via SoundCast®, a Premiere Global service, and can be accessed at http://ir.premiereglobal.com . You may also follow this link for details on the Internet replay, podcast and for the text of the earnings release, including the financial and statistical information to be presented in the call.
A replay will be available following the call at 8:00 p.m. Eastern through midnight Eastern March 2, 2007, and can be accessed by calling (888) 203-1112 (US & Canada) or (719) 457-0820 (International). The confirmation code is 7985514. The Webcast of this call will be archived on the Company’s Website at http://ir.premiereglobal.com .
About Premiere Global Services, Inc.
Premiere Global Services, Inc., formerly Ptek Holdings, Inc., is a leading global provider of innovative business communications and data services. Customers use our ASP platform to conduct traditional and VoIP-based collaboration sessions and to process and deliver large quantities of individualized, business critical information. Premiere Global offers outsourced document delivery, data capture, alerts/notifications and campaign management solutions that automate customers' business processes and improve efficiency levels enterprise-wide. We also offer a full suite of conferencing solutions, including automated, operator-assisted and Web collaboration services that enable customers to communicate real-time via our advanced, open standards global conferencing platform.
Premiere Global serves more than 46,000 corporate accounts in nearly every business sector, throughout 18 countries worldwide. Our corporate headquarters is located at 3399 Peachtree Road NE, Suite 700, Atlanta, GA 30326. Additional information can be found at www.pgi.com.
Forward-looking and cautionary statements
Statements made in this press release, other than those concerning historical information, should be considered forward-looking and subject to various risks and uncertainties. Such forward-looking statements are made pursuant to the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 and are made based on management's current expectations or beliefs as well as assumptions made by, and information currently available to, management. A variety of factors could cause actual results to differ materially from those anticipated in Premiere Global Services' forward-looking statements, including, but not limited to, the following factors: competitive pressures, including pricing pressures; technological change; the development of alternatives to our services; market acceptance of our new services and enhancements; integration of acquired companies; service interruptions; increased financial leverage; our dependence on our subsidiaries for cash flow; continued weakness in our legacy broadcast fax business; foreign currency exchange rates; possible adverse results of pending or future litigation or infringement claims; federal or state legislative or regulatory changes; general domestic and international economic, business or political conditions; and other factors described from time to time in our press releases, reports and other filings with the SEC, including but not limited the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2005 and our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2006 and September 30, 2006. All forward-looking statements attributable to us or a person acting on our behalf are expressly qualified in their entirety by this cautionary statement.