-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TaY38DzVu5xOTOP8t1K9hJ8wLmguW9W9vWQNK6qfwxmJx34QqRYxBi7lOUafzgGm 1LdZu8wIWaHN9JGQ9yHIBQ== 0001157523-06-004256.txt : 20060427 0001157523-06-004256.hdr.sgml : 20060427 20060427161938 ACCESSION NUMBER: 0001157523-06-004256 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060427 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060427 DATE AS OF CHANGE: 20060427 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PREMIERE GLOBAL SERVICES, INC. CENTRAL INDEX KEY: 0000880804 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-BUSINESS SERVICES, NEC [7389] IRS NUMBER: 593074176 STATE OF INCORPORATION: GA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13577 FILM NUMBER: 06785529 BUSINESS ADDRESS: STREET 1: 3399 PEACHTREE RD NE STREET 2: THE LENOX BUILDING, SUITE 700 CITY: ATLANTA STATE: GA ZIP: 30326 BUSINESS PHONE: 4042628400 MAIL ADDRESS: STREET 1: 3399 PEACHTREE RD NE STREET 2: THE LENOX BUILDING, SUITE 700 CITY: ATLANTA STATE: GA ZIP: 30326 FORMER COMPANY: FORMER CONFORMED NAME: PTEK HOLDINGS INC DATE OF NAME CHANGE: 20000306 FORMER COMPANY: FORMER CONFORMED NAME: PREMIERE TECHNOLOGIES INC DATE OF NAME CHANGE: 19951219 8-K 1 a5134600.txt PREMIERE GLOBAL SERVICES, INC. 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported) April 27, 2006 ------------------------- PREMIERE GLOBAL SERVICES, INC. - -------------------------------------------------------------------------------- (Exact Name of Registrant as Specified in Its Charter) Georgia - -------------------------------------------------------------------------------- (State or Other Jurisdiction of Incorporation) 001-13577 59-3074176 - -------------------------------------------------------------------------------- (Commission File Number) (IRS Employer Identification No.) 3399 Peachtree Road, NE, Suite 700, Atlanta, Georgia 30326 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) 404-262-8400 - -------------------------------------------------------------------------------- (Registrant's Telephone Number, Including Area Code) - -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): |_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Item 2.02 Results of Operations and Financial Condition. - --------- ---------------------------------------------- On April 27, 2006, Premiere Global Services, Inc. issued a press release reporting on its financial results for the quarter ended March 31, 2006. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference. In accordance with General Instruction B.2 of Form 8-K, the information included or incorporated in this report, including Exhibit 99.1, is being furnished to the Securities and Exchange Commission and shall not be deemed "filed" for purposes of Section 18 of the Securities and Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, except as shall be expressly set forth by specific reference in such filing. Item 9.01. Financial Statements and Exhibits - ---------- --------------------------------- (d) Exhibits Exhibit No. Description - -------------- ---------------------------------------------------------------- 99.1 Press Release, dated April 27, 2006, with respect to the Registrant's financial results for 99.1 the quarter ended March 31, 2006. 2 SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. PREMIERE GLOBAL SERVICES, INC. Date: April 27, 2006 /s/ Michael E. Havener -------------------------------------------- Michael E. Havener Chief Financial Officer (principal financial and accounting officer) 3 INDEX TO EXHIBITS ----------------- Exhibit No. Description - -------------- ---------------------------------------------------------------- 99.1 Press Release, dated April 27, 2006, with respect to the Registrant's financial results for 99.1 the quarter ended March 31, 2006. EX-99.1 2 a5134600ex99_1.txt EXHIBIT 99.1 PRESS RELEASE Exhibit 99.1 Premiere Global Services Reports First Quarter Results; $121.7M in Revenues and $0.12 Normalized Diluted EPS from Continuing Operations ATLANTA--(BUSINESS WIRE)--April 27, 2006--Premiere Global Services, Inc. (NYSE: PGI), a global outsource provider of business process solutions, today announced results for the first quarter ended March 31, 2006. Revenues in the first quarter of 2006 were $121.7 million, down 4.4% compared to $127.3 million in the first quarter of 2005. Excluding pre-tax restructuring costs of $1.1 million, normalized operating income totaled $15.0 million, normalized income from continuing operations totaled $8.3 million and normalized diluted EPS from continuing operations was $0.12 in the first quarter of 2006, versus $22.8 million, $13.4 million and $0.19, respectively, in the first quarter of 2005.(a) In the first quarter of 2006 in accordance with GAAP, operating income totaled $14.0 million, income from continuing operations totaled $7.7 million and diluted EPS from continuing operations totaled $0.11, versus $22.4 million, $13.1 million and $0.18, respectively, in the first quarter of 2005. First Quarter 2006 Revenue Detail Conferencing & Collaboration revenue totaled $66.8 million, up 7.7% from $62.0 million in the comparable prior year quarter. As expected, revenue from the Company's largest customer declined by $8.7 million, totaling $2.7 million in the first quarter of 2006 versus $11.5 million in the first quarter of 2005. Excluding revenue contribution from this customer in both quarters, Conferencing & Collaboration revenue increased 26.7% in the first quarter of 2006 versus the first quarter of 2005.(a) Data Communications revenue totaled $55.0 million, down 15.8% from $65.3 million in the comparable prior year quarter. Revenue from legacy broadcast fax services declined $7.5 million dollars, totaling $24.7 million versus $32.2 million in the first quarter of 2005. Year-to-Date 2006 Accomplishments -- Generated record monthly Conferencing Solutions volumes -- Augmented Marketing Automation Solutions with the acquisition of Accucast, Inc., whose intelligence-based platform makes it a recognized industry leader in on-line marketing -- Within Document Solutions, DocuManager, an electronic fax solution, continued to generate new users, recording 75% growth in the first quarter compared to the first quarter of 2005 -- Continued to improve the communication technologies platform with enhancements to SMS delivery capabilities for Alerts & Notifications Solutions -- Formally launched PremiereAnywhere solution suite targeted at increasing the productivity of the growing number of mobile professionals -- Generated $18.9 million in normalized cash flows from operating activities from continuing operations, which excludes payments for restructuring costs and payments for legal settlements and related expenses (a) -- Expanded bank revolving line of credit limit to $300 million from $180 million with improved borrowing economics and covenants, and an extended term "We are pleased with our revenue performance during the quarter, especially the continued strength in our Conferencing & Collaboration business, which once again outperformed the industry in a very competitive environment," said Boland T. Jones, Founder, Chairman and CEO of Premiere Global Services, Inc. "Results in our Data Communications business continue to be overshadowed by its legacy services, but we believe it has the potential to be a great business, and we are taking the necessary steps to generate performance similar to that of our Conferencing & Collaboration business. We remain convinced that Premiere Global Services is uniquely positioned in the marketplace with the sole focus of innovating communication technologies that help businesses simplify their daily processes, making them more competitive, more efficient and more profitable. We are making meaningful progress toward the key business objectives we established to help move our Company from good to great." Financial Outlook The following statements and non-GAAP financial table are based on Premiere Global Services' current expectations as of April 27, 2006. These statements and projected non-GAAP financial table 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 confirms its outlook that revenues for 2006 are anticipated to be at the low end of the range of $480 to $500 million. The Company anticipates normalized diluted EPS from continuing operations, which excludes restructuring costs, in 2006 to be in the range of $0.50 to $0.58. See the reconciliation of projected non-GAAP financial measures as set forth below: Year Ended December 31, 2006 (1) -------------- (in millions, except per share data) Projected normalized diluted EPS from continuing operations (2) (a) Projected diluted EPS from continuing operations $0.49 - $0.57 Excluding restructuring costs $0.01 -------------- Projected normalized diluted EPS from continuing operations $0.50 - $0.58 Projected pro forma diluted EPS from continuing operations (3) (a) Projected diluted EPS from continuing operations $0.49 - $0.57 Excluding restructuring costs $0.01 Excluding non-cash equity based compensation $0.09 Excluding amortization $0.11 -------------- Projected pro forma diluted EPS from continuing operations $0.70 - $0.78 Projected normalized cash provided by operating activities from continuing operations (4) (a) Projected cash provided by operating activities from continuing operations $78.0 - $85.0 Payments for restructuring costs $2.5 Payments for legal settlements and related expenses $2.5 -------------- Projected normalized cash provided by operating activities from continuing operations $83.0 - $90.0 (1) Amounts presented are estimates, and the Company has made a number of assumptions in preparing our projections, including assumptions as to the components of these financial metrics. The reconciliations of projected non-GAAP financial measures include forward-looking information with respect to the information identified as a projection. The EPS projections assume a projected weighed average diluted share count of approximately 72.8 million shares. (2) Management believes that normalized operating income, normalized income from continuing operations and normalized diluted EPS from continuing operations provide useful information regarding underlying trends in our continuing operations by excluding non-recurring items that are unrelated to our ongoing operations, including restructuring costs and legal settlements and related expenses. (3) The Company expects equity based compensation expense to be a recurring cost and presents pro forma diluted EPS from continuing operations to exclude this item as well as restructuring costs and amortization expense to eliminate these significant non-cash charges to earnings to help investors better understand the operating performance of our business. (4) Management believes that normalized cash provided by operating activities from continuing operations provides useful information regarding underlying trends in our continuing operations by excluding non-recurring items that are unrelated to our ongoing operations. (a) To supplement the Company's consolidated financial statements presented in accordance with GAAP we have included the following non-GAAP measures of financial performance: normalized operating income, normalized income from continuing operations, normalized diluted EPS from continuing operations, normalized cash provided by operating activities from continuing operations and pro forma diluted EPS 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 business segment 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. Conference Call 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) 289-0494 (US & Canada) or (913) 981-5520 (International). The conference call will be simultaneously broadcast over the Internet via SoundCast(R), 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 May 5, 2006, and can be accessed by calling (888) 203-1112 (US & Canada) or (719) 457-0820 (International). The confirmation code is 1736499. 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. is a global outsource provider of business process solutions that enable enterprise customers to automate and simplify their critical business processes and to communicate more effectively with their constituents. We innovate communication technologies and deliver solutions in four core business practices: Conferencing Solutions, Document Solutions, Marketing Automation Solutions and Alerts & Notifications Solutions. We deliver these solutions via our global, on-demand platforms to an established customer base of approximately 60,000 corporate accounts, including a majority of the Fortune 500. Customers apply our solutions in order to increase efficiency, to improve productivity and to raise customer satisfaction levels. With global presence in 19 countries, Premiere Global Services' corporate headquarters is located at 3399 Peachtree Road NE, Suite 700, Atlanta, GA 30326. Additional information can be found at www.premiereglobal.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' 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. All forward-looking statements attributable to us or a person acting on our behalf are expressly qualified in their entirety by this cautionary statement. PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2006 AND 2005 (IN THOUSANDS, UNAUDITED, EXCEPT PER SHARE DATA) Three Months Ended March 31, 2006 2005 ---------- ---------- REVENUES $ 121,726 $ 127,264 OPERATING EXPENSES: Cost of revenues (exclusive of depreciation shown separately below) 48,340 45,858 Selling and marketing 32,798 32,734 General and administrative 13,754 13,641 Research and development 2,807 2,567 Depreciation 5,927 6,552 Amortization 3,097 3,086 Restructuring costs 1,053 415 ---------- ---------- Total operating expenses 107,776 104,853 OPERATING INCOME 13,950 22,411 ---------- ---------- OTHER (EXPENSE) INCOME: Interest expense (1,814) (982) Interest income 161 312 Loss on sale of marketable securities - (116) Other, net (233) 93 ---------- ---------- Total other (expense) income (1,886) (693) ---------- ---------- INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES 12,064 21,718 INCOME TAX EXPENSE 4,405 8,599 ---------- ---------- INCOME FROM CONTINUING OPERATIONS $ 7,659 $ 13,119 ========== ========== NET INCOME $ 7,659 $ 13,119 ========== ========== BASIC EARNINGS PER SHARE: Income from continuing operations $ 7,659 $ 13,119 ========== ========== Net income $ 7,659 $ 13,119 ========== ========== BASIC WEIGHTED-AVERAGE SHARES OUTSTANDING: 70,465 70,455 ========== ========== Basic earnings per share: Continuing operations $ 0.11 $ 0.19 ========== ========== Net income $ 0.11 $ 0.19 ========== ========== DILUTED EARNINGS PER SHARE: Income from continuing operations for purposes of computing diluted net income per share $ 7,659 $ 13,119 ---------- ---------- Net income for purposes of computing diluted net income per share $ 7,659 $ 13,119 ---------- ---------- DILUTED WEIGHTED-AVERAGE SHARES OUTSTANDING: 72,114 71,804 ========== ========== Diluted earnings per share: Continuing operations $ 0.11 $ 0.18 ========== ========== Net income $ 0.11 $ 0.18 ========== ========== PREMIERE GLOBAL SERVICES, INC AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS MARCH 31, 2006 AND DECEMBER 31, 2005 (IN THOUSANDS, EXCEPT SHARE DATA) March December 31, 31, 2006 2005 ---------- ---------- (Unaudited) ASSETS CURRENT ASSETS Cash and equivalents $ 22,261 $ 20,508 Accounts receivable (less allowances of $6,494 and $7,560, respectively) 84,654 79,417 Prepaid expenses and other 6,613 5,209 Deferred income taxes, net 12,638 12,392 ---------- ---------- Total current assets 126,166 117,526 PROPERTY AND EQUIPMENT, NET 79,045 75,742 OTHER ASSETS Goodwill 269,416 257,565 Intangibles, net 39,593 39,662 Deferred income taxes, net - 837 Other assets 3,858 3,958 ---------- ---------- $ 518,078 $ 495,290 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 40,181 $ 37,745 Income taxes payable 7,036 4,394 Accrued taxes 6,352 6,148 Accrued expenses 32,057 34,439 Current maturities of long-term debt and capital lease obligations 931 799 Accrued restructuring costs 2,310 1,800 ---------- ---------- Total current liabilities 88,867 85,325 LONG-TERM LIABILITIES Long-term debt and capital lease obligations 107,641 99,675 Other accrued expenses 5,970 6,540 Deferred income taxes, net 295 - ---------- ---------- Total long-term liabilities 113,906 106,215 SHAREHOLDERS' EQUITY Common stock $0.01 par value; 150,000,000 shares authorized, 72,309,542 and 71,703,933 shares issued and outstanding at March 31, 2006 and December 31, 2005, respectively 726 717 Additional paid-in capital 699,492 694,304 Unearned restricted stock compensation (14,715) (12,585) Note receivable, shareholder (1,923) (1,896) Cumulative translation adjustment (2,698) (3,554) Accumulated deficit (365,577) (373,236) ---------- ---------- Total shareholders' equity 315,305 303,750 ---------- ---------- $ 518,078 $ 495,290 ========== ========== PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2006 AND 2005 (IN THOUSANDS, UNAUDITED) 2006 2005 ---------- ---------- CASH FLOWS FROM OPERATING ACTIVITIES Net income 7,659 13,119 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 5,927 6,552 Amortization 3,097 3,086 Amortization of deferred financing costs 116 114 Loss on sale of marketable securities, available for sale - 116 Payments for legal settlements and related expenses (1,372) - Deferred income taxes - 4,059 Restructuring costs 1,053 415 Payments for restructuring costs (720) (277) Equity based compensation 2,330 1,963 Loss (Gain) on disposal of assets 256 (45) Changes in assets and liabilities: Accounts receivable, net (4,517) (10,207) Prepaid expenses and other current assets (864) (780) Accounts payable and accrued expenses 3,878 2,930 ---------- ---------- Total adjustments 9,184 7,926 ---------- ---------- Total cash provided by operating activities from continuing operations 16,843 21,045 ---------- ---------- Payments for discontinued operations (245) (268) ---------- ---------- Total cash provided by operating activities 16,598 20,777 ---------- ---------- CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures (8,993) (7,000) Sale of marketable securities - 755 Purchase of marketable securities - (306) Business acquisitions, net of cash acquired (13,896) (45,615) ---------- ---------- Net cash used in investing activities (22,889) (52,166) ---------- ---------- CASH FLOWS FROM FINANCING ACTIVITIES Principal payments under borrowing arrangements (21,618) (12,161) Principal proceeds under borrowing arrangements 29,500 48,400 Purchase of treasury stock, at cost (750) (10,156) Exercise of stock options 1,050 2,674 ---------- ---------- Total cash provided by financing activities 8,182 28,757 ---------- ---------- Effect of exchange rate changes on cash and equivalents (138) (206) ---------- ---------- NET INCREASE (DECREASE) IN CASH AND EQUIVALENTS 1,753 (2,838) ---------- ---------- CASH AND EQUIVALENTS, beginning of period $ 20,508 $ 25,882 ---------- ---------- CASH AND EQUIVALENTS, end of period $ 22,261 $ 23,044 ========== ========== PREMIERE GLOBAL SERVICES, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES NORMALIZED CONSOLIDATED STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2006 AND 2005 (IN THOUSANDS, UNAUDITED, EXCEPT PER SHARE DATA) Three Months Ended --------------------------------- Reported Normalized March 31, Non-GAAP March 31, 2006 Adjustments 2006 --------- ------------ ---------- REVENUES $121,726 $121,726 OPERATING EXPENSES: Cost of revenues (exclusive of depreciation shown separately below) 48,340 (163) (2) 48,177 Selling and marketing 32,798 (431) (2) 32,367 General and administrative 13,754 (1,484) (2) 12,270 Research and development 2,807 (178) (2) 2,629 Depreciation 5,927 5,927 Amortization 3,097 3,097 Restructuring costs 1,053 (1,053) (1) - Equity based compensation - 2,256 (2) 2,256 --------- -------- --------- Total operating expenses 107,776 (1,053) 106,723 OPERATING INCOME 13,950 1,053 15,003 (1) --------- -------- --------- OTHER (EXPENSE) INCOME: Interest expense (1,814) (1,814) Interest income 161 161 Loss on sale of marketable securities - - Other, net (233) (233) --------- -------- --------- Total other (expense) income (1,886) - (1,886) --------- -------- --------- INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES 12,064 1,053 13,117 INCOME TAX EXPENSE 4,405 399 4,804 --------- -------- --------- INCOME FROM CONTINUING OPERATIONS $ 7,659 $ 654 $ 8,313 (1) ========= ======== ========= NET INCOME $ 7,659 $ 654 $ 8,313 ========= ======== ========= BASIC EARNINGS PER SHARE: Income from continuing operations $ 7,659 $ 8,313 ========= ========= Net income $ 7,659 $ 8,313 ========= ========= BASIC WEIGHTED-AVERAGE SHARES OUTSTANDING: 70,465 70,465 ========= ========= Basic earnings per share: Continuing operations $ 0.11 $ 0.12 ========= ========= Net income $ 0.11 $ 0.12 ========= ========= DILUTED EARNINGS PER SHARE: Income from continuing operations for purposes of computing diluted net income per share $ 7,659 $ 8,313 --------- --------- Net income for purposes of computing diluted net income per share $ 7,659 $ 8,313 --------- --------- DILUTED WEIGHTED-AVERAGE SHARES OUTSTANDING: 72,114 72,114 ========= ========= Diluted earnings per share: Continuing operations $ 0.11 $ 0.12 (1) ========= ========= Net income $ 0.11 $ 0.12 ========= ========= Three Months Ended --------------------------------- Reported Normalized March 31, Non-GAAP March 31, 2005 Adjustments 2005 --------- ------------ ---------- REVENUES $127,264 $127,264 OPERATING EXPENSES: Cost of revenues (exclusive of depreciation shown separately below) 45,858 (35) (2) 45,823 Selling and marketing 32,734 (297) (2) 32,437 General and administrative 13,641 (1,630) (2) 12,011 Research and development 2,567 (1) (2) 2,566 Depreciation 6,552 6,552 Amortization 3,086 3,086 Restructuring costs 415 (415) (1) - Equity based compensation - 1,963 (2) 1,963 --------- -------- --------- Total operating expenses 104,853 (415) 104,438 OPERATING INCOME 22,411 415 22,826 (1) --------- -------- --------- OTHER (EXPENSE) INCOME: Interest expense (982) (982) Interest income 312 312 Loss on sale of marketable securities (116) (116) Other, net 93 93 --------- -------- --------- Total other (expense) income (693) - (693) --------- -------- --------- INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES 21,718 415 22,133 INCOME TAX EXPENSE 8,599 164 8,763 --------- -------- --------- INCOME FROM CONTINUING OPERATIONS $ 13,119 $ 251 $ 13,370 (1) ========= ======== ========= NET INCOME $ 13,119 $ 251 $ 13,370 ========= ======== ========= BASIC EARNINGS PER SHARE: Income from continuing operations $ 13,119 $ 13,370 ========= ========= Net income $ 13,119 $ 13,370 ========= ========= BASIC WEIGHTED-AVERAGE SHARES OUTSTANDING: 70,455 70,455 ========= ========= Basic earnings per share: Continuing operations $ 0.19 $ 0.19 ========= ========= Net income $ 0.19 $ 0.19 ========= ========= DILUTED EARNINGS PER SHARE: Income from continuing operations for purposes of computing diluted net income per share $ 13,119 $ 13,370 --------- --------- Net income for purposes of computing diluted net income per share $ 13,119 $ 13,370 --------- --------- DILUTED WEIGHTED- AVERAGE SHARES OUTSTANDING: 71,804 71,804 ========= ========= Diluted earnings per share: Continuing operations $ 0.18 $ 0.19 (1) ========= ========= Net income $ 0.18 $ 0.19 ========= ========= (1) Management believes that normalized operating income, normalized income from continuing operations and normalized diluted EPS from continuing operations provide useful information regarding underlying trends in our continuing operations by excluding non-recurring items that are unrelated to our ongoing operations, including restructuring costs and legal settlements and related expenses. (2) Due to the Company's adoption as of January 1, 2006 of SFAS No. 123R, "Share-Based Payment," equity based compensation in our income statement is allocated to the following expense line items (in thousands): Three Months Ended March 31, 2006 2005 -------- --------- Cost of revenues $ 163 $ 35 Selling and marketing 431 297 General and administrative 1,484 1,630 Research and development 178 1 -------- --------- Equity based compensation $ 2,256 $ 1,963 -------- --------- PREMIERE GLOBAL SERVICES, INC AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (IN THOUSANDS, UNAUDITED, EXCEPT SHARE DATA) Three Months Ended March 31, 2006 2005 ---------- ---------- Segment Revenues Excluding Certain Items (1) Revenues, as reported Conferencing & Collaboration $ 66,774 $ 62,010 Data Communications 54,952 65,254 ---------- ---------- $ 121,726 $127,264 Conferencing & Collaboration $ 66,774 $ 62,010 Excluding largest customer revenue 2,704 11,452 ---------- ---------- Conferencing & Collaboration excluding largest customer revenue $ 64,070 $ 50,558 ---------- ---------- Data Communications $ 54,952 $ 65,254 Excluding legacy broadcast fax revenue 24,673 32,221 ---------- ---------- Data Communications excluding legacy broadcast fax revenue $ 30,279 $ 33,033 ---------- ---------- Revenues, as reported $ 121,726 $127,264 Excluding Conferencing & Collaboration largest customer revenue 2,704 11,452 Excluding Data Communications legacy broadcast fax revenue 24,673 32,221 ---------- ---------- Revenues excluding certain items $ 94,349 $ 83,591 ---------- ---------- Normalized cash provided by operating activities from continuing operations (2) Total cash provided by operating activities from continuing operations $ 16,843 $ 21,045 Payments for restructuring costs 720 277 Payments for legal settlements and related expenses 1,372 - ---------- ---------- Normalized cash provided by operating activities from continuing operations $ 18,935 $ 21,322 ---------- ---------- (1) The Company has previously announced Conferencing & Collaboration's largest customer's intention to insource most of its automated conferencing needs, as well as the acceleration in the decline of revenue generated by Data Communications legacy broadcast fax business in North America. The Company has presented business segment revenue excluding these items because management believes that these events or trends particular to each business segment may be deemed to be so significant to obscure patterns and trends of our core business in total. (2) Management believes that normalized cash provided by operating activities from continuing operations provides useful information regarding underlying trends in our continuing operations by excluding payments relating to non-recurring items that are unrelated to our ongoing operations. CONTACT: Premiere Global Services, Inc. Investor Calls Sean O'Brien, 404-262-8462 -----END PRIVACY-ENHANCED MESSAGE-----