PGi Reports Third Quarter 2012 Results: Organic Revenues Grew 7.0%* to $125.9M; Non-GAAP Diluted EPS from Continuing Operations $0.18*

ATLANTA, Oct. 18, 2012 /PRNewswire/ -- Premiere Global Services, Inc. (NYSE: PGI), a global leader in virtual meetings for over 20 years, today announced results for the third quarter ended September 30, 2012.

In the third quarter of 2012, net revenues increased to $125.9 million, compared to $119.2 million in the third quarter of 2011.  Diluted EPS from continuing operations was $0.12 and non-GAAP diluted EPS from continuing operations was $0.18* in the third quarter of 2012, compared to diluted EPS from continuing operations of $0.12 and non-GAAP diluted EPS from continuing operations of $0.18* in the third quarter of 2011.  

"We maintained solid trends across our global business in the third quarter, despite the typical seasonal pressure of the summer months," said Boland T. Jones, PGi founder, chairman and CEO. "Sales of iMeet® and GlobalMeet® continue to grow, as a result of an increasing demand by business professionals looking for simpler, more intuitive ways to meet and collaborate online, wherever and whenever they want. We remain optimistic in our outlook for the fourth quarter and for 2013, as we continue to grow and transition PGi toward a software as a service model."

Third Quarter 2012 Accomplishments

  • Reported 7.0% organic revenue growth as compared to the third quarter of 2011;
  • Grew total meetings hosted by over 30% as compared to the third quarter of 2011;
  • Grew the annual revenue run-rate from iMeet and GlobalMeet by greater than 17% as compared to the second quarter of 2012;
  • PGi recognized as the Silver Stevie® Award winner for "Most Innovative Tech Company of the Year" at the 2012 American Business Awards℠; and
  • Repurchased nearly 800,000 shares of our common stock in the open market under our share repurchase plan.

Nine Month Results

In the first nine months of 2012, net revenues totaled $379.5 million, compared to $355.1 million in the first nine months of 2011.  Diluted EPS from continuing operations was $0.38 and non-GAAP diluted EPS from continuing operations was $0.55* in the first nine months of 2012, compared to diluted EPS from continuing operations of $0.27 and non-GAAP diluted EPS from continuing operations of $0.44* in the first nine months of 2011. 

Financial Outlook

The following statements are based on PGi's current expectations. These statements contain forward-looking statements and company estimates, and actual results may differ materially.  PGi assumes no duty to update any forward-looking statements made in this press release.

Based on current business trends and current foreign currency exchange rates, PGi anticipates net revenues from continuing operations in 2012 will be in the range of $504-$507 million and non-GAAP diluted EPS from continuing operations will be in the range of $0.73-$0.74*.

PGi will host a conference call today at 5:00 p.m., Eastern Time, 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) 776-0487 (U.S. and Canada) or (913) 312-0658 (International).  The conference call will simultaneously be webcast.  Please visit www.pgi.com for webcast details and conference call replay information, as well as the webcast archive and the text of the earnings release, including the financial and statistical information to be presented during the call.

* Non-GAAP Financial Measures

To supplement the company's consolidated financial statements presented in accordance with GAAP, we have included the following non-GAAP measures of financial performance: non-GAAP operating income, non-GAAP net income from continuing operations, non-GAAP diluted net income per share (EPS) from continuing operations and organic growth. The company has also included these non-GAAP measures, as well as net revenues and segment net revenues, on a constant currency basis.  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.  Please see the table 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. 

About Premiere Global Services, Inc. │ PGi
PGi has been a global leader in virtual meetings for more than 20 years. Our cloud-based solutions deliver multi-point, real-time virtual collaboration using video, voice and file sharing technologies. PGi solutions are available via desktops, tablets or mobile devices, helping businesses worldwide be more productive, mobile and green.  PGi has a global presence in 25 countries and an established base of more than 35,000 enterprise customers, including 75% of the Fortune 100.  In the last five years, we have hosted more than 725 million people from 137 countries in over 165 million meetings.

For more information, visit us at http://www.pgi.com.

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, Inc.'s forward-looking statements, including, but not limited to, the following factors: competitive pressures, including pricing pressures; technological changes and the development of alternatives to our services; market acceptance of new cloud-based, virtual meeting services, including our iMeet® and GlobalMeet® services; our ability to attract new customers and to retain and further penetrate our existing customers; risks associated with challenging global economic conditions; price increases from our telecommunications service providers; service interruptions and network downtime; technological obsolescence and our ability to upgrade our equipment or increase our network capacity; concerns regarding the security of transactions; future write-downs of goodwill or other intangible assets; greater than anticipated tax liabilities; restructuring and cost reduction initiatives and the market reaction thereto; our level of indebtedness; risks associated with acquisitions and divestitures; the impact of the sale of our PGiSend business; our ability to protect our intellectual property rights, including possible adverse results of litigation or infringement claims; regulatory or legislative changes, including further government regulations applicable to traditional telecommunications service providers and data privacy; risks associated with international operations and market expansion, including fluctuations in foreign currency exchange rates; and other factors described from time to time in our press releases, reports and other filings with the Securities and Exchange Commission, including but not limited to the "Risk Factors" section of our Annual Report on Form 10-K for the year ended December 31, 2011. All forward-looking statements attributable to us or a person acting on our behalf are expressly qualified in their entirety by this cautionary statement.

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Sean O'Brien
Executive Vice President
Strategy & Communications
(404) 262-8462

  












PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)



























 Three Months Ended


 Nine Months Ended  





 September 30,  


 September 30,  





2012


2011


2012


2011





 (Unaudited) 


 (Unaudited) 












Net revenues


$ 125,892


$ 119,184


$ 379,510


$ 355,099

Operating expenses: 










Cost of revenues (exclusive of

depreciation and amortization

shown separately below)


53,806


49,938


161,044


146,595


Selling and marketing


31,725


32,167


98,756


102,526


General and administrative

(exclusive of expenses shown separately below)


15,855


14,411


47,070


42,409


Research and development


3,703


2,934


10,608


8,737


Excise and sales tax expense


-


331


118


352


Depreciation


8,251


7,737


24,207


23,172


Amortization


807


1,612


3,239


5,061


Restructuring costs


590


38


703


38


Asset impairments


696


62


741


116


Net legal settlements and

related expenses


1,769


43


1,851


115



Total operating expenses


117,202


109,273


348,337


329,121












Operating income


8,690


9,911


31,173


25,978












Other (expense) income:










Interest expense


(1,843)


(2,192)


(5,404)


(6,381)


Interest income


10


7


19


34


Other, net


(282)


143


(531)


(235)



Total other expense


(2,115)


(2,042)


(5,916)


(6,582)












Income from continuing operations

before income taxes


6,575


7,869


25,257


19,396

Income tax expense


855


2,047


6,618


5,789

Net income from continuing operations


5,720


5,822


18,639


13,607












(Loss) income from discontinued

operations, net of taxes


(61)


6,735


(334)


6,740












Net income


$      5,659


$   12,557


$   18,305


$   20,347












BASIC WEIGHTED-AVERAGE

SHARES OUTSTANDING


47,297


49,033


47,949


49,982












Basic net income (loss) per share (1)










Continuing operations


$        0.12


$        0.12


$        0.39


$        0.27


Discontinued operations


-


0.14


(0.01)


0.13


Net income per share


$        0.12


$        0.26


$        0.38


$        0.41












DILUTED WEIGHTED-AVERAGE

SHARES OUTSTANDING


47,800


49,366


48,424


50,308












Diluted net income (loss) per share (1)










Continuing operations


$        0.12


$        0.12


$        0.38


$        0.27


Discontinued operations


-


0.14


(0.01)


0.13


Net income per share


$        0.12


$        0.25


$        0.38


$        0.40












(1)

Column totals may not sum due to the effect of rounding on EPS.


  







PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)
















September 30,


December 31,




2012


2011




(Unaudited)



ASSETS




CURRENT ASSETS





Cash and equivalents

$           33,144


$           32,033


Accounts receivable (less allowances of $749 and $613,

respectively)

84,974


72,518


Prepaid expenses and other current assets

18,116


13,906


Income taxes receivable

661


1,739


Deferred income taxes, net

1,702


1,090



Total current assets

138,597


121,286







PROPERTY AND EQUIPMENT, NET

102,609


103,449







OTHER ASSETS





Goodwill

297,436


295,690


Intangibles, net of amortization

7,962


10,906


Deferred income taxes, net

4,290


3,474


Other assets

8,690


8,016



TOTAL ASSETS

$         559,584


$        542,821







LIABILITIES AND SHAREHOLDERS' EQUITY




CURRENT LIABILITIES





Accounts payable

$           46,770


$           42,589


Income taxes payable

158


962


Accrued taxes, other than income taxes

2,975


3,611


Accrued expenses

28,583


28,999


Current maturities of long-term debt and capital lease obligations 

3,926


3,845


Accrued restructuring costs

2,205


2,287


Deferred income taxes, net

72


386



Total current liabilities

84,689


82,679







LONG-TERM LIABILITIES





Long-term debt and capital lease obligations 

200,147


195,963


Accrued restructuring costs

353


1,410


Accrued expenses

17,074


17,249


Deferred income taxes, net

5,713


1,783



Total long-term liabilities

223,287


216,405







SHAREHOLDERS' EQUITY





Common stock, $0.01 par value; 150,000,000 shares authorized,

48,431,753 and 50,144,703 shares issued and outstanding,

respectively

484


501


Additional paid-in capital

462,368


475,013


Accumulated other comprehensive gain

13,037


10,809


Accumulated deficit

(224,281)


(242,586)



Total shareholders' equity

251,608


243,737



TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

$         559,584


$        542,821







  










PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

 (in thousands)

























Nine Months Ended







September 30, 







2012


2011







(Unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES







Net income 


$ 18,305


$ 20,347



Loss (income) from discontinued operations, net of taxes


334


(6,740)




 Net income from continuing operations 


18,639


13,607


Adjustments to reconcile net income to net cash provided by operating

activities:







Depreciation


24,207


23,172



Amortization


3,239


5,061



Amortization of debt issuance costs 


443


702



Net legal settlements and related expenses


1,851


36



Payments for legal settlements and related expenses


(101)


(36)



Deferred income taxes


2,907


1,411



Restructuring costs


703


38



Payments for restructuring costs 


(1,887)


(5,673)



Asset impairments


741


116



Equity-based compensation


6,113


5,209



Excess tax benefits from share-based payment arrangements


(267)


-



Provision for doubtful accounts


828


456



Changes in working capital


(14,412)


(4,528)





Net cash provided by operating activities from continuing

operations


43,004


39,571





Net cash used in operating activities from discontinued

operations


(668)


(591)





Net cash provided by operating activities


42,336


38,980










CASH FLOWS FROM INVESTING ACTIVITIES







Capital expenditures


(24,154)


(23,304)



Other investing activities


(1,479)


(1,222)



Business dispositions


-


1,903





Net cash used in investing activities from continuing operations


(25,633)


(22,623)





Net cash used in investing activities from discontinued

operations


(60)


-





Net cash used in investing activities


(25,693)


(22,623)



















CASH FLOWS FROM FINANCING ACTIVITIES







Principal payments under borrowing arrangements


(53,011)


(50,067)



Proceeds from borrowing arrangements


55,529


68,971



Payments of debt issuance costs


(23)


-



Excess tax benefits of share-based payment arrangements


267


-



Purchase of treasury stock, at cost


(19,358)


(20,911)



Exercise of stock options


932


-





Net cash used in financing activities from continuing operations


(15,664)


(2,007)





Net cash used in financing activities from discontinued

operations


-


-





Net cash used in financing activities


(15,664)


(2,007)










Effect of exchange rate changes on cash and equivalents


132


(437)










NET INCREASE IN CASH AND EQUIVALENTS


1,111


13,913

CASH AND EQUIVALENTS, beginning of period


32,033


15,101

CASH AND EQUIVALENTS, end of period


$ 33,144


$ 29,014