8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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): October 1, 2009

VALASSIS COMMUNICATIONS, INC.

(Exact name of registrant as specified in its charter)

Delaware	1-10991	38-2760940
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

19975 Victor Parkway, Livonia, MI	48152
(Address of Principal Executive Offices)	(Zip Code)

(734) 591-3000

Registrant’s Telephone Number, Including Area Code

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:

¨ 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))

Items to be Included in this Report

Item 7.01. Regulation FD Disclosure.

Valassis Communications, Inc. (“Valassis”) is furnishing the attached investor presentation as Exhibit 99.1, which was presented this afternoon by Robert L. Recchia, Executive Vice President, Treasurer and Chief Financial Officer of Valassis, at the Deutsche Bank Securities Leveraged Finance Conference and was webcast. A replay of the webcast and a copy of the investor presentation has also been available through the Investors section of Valassis’ website at www.valassis.com. Valassis does not intend to file any update to the webcast or the investor presentation. The fact that this investor presentation is being furnished should not be deemed an admission as to the materiality of any information contained in the presentation.

The information furnished pursuant to this Current Report on Form 8-K (including Exhibit 99.1 hereto) shall not be considered “filed” under the Securities Exchange Act of 1934, as amended, nor shall it be incorporated by reference into any filings by Valassis under the Securities Act of 1933, as amended, or under the Securities Exchange Act of 1934, as amended, unless Valassis expressly sets forth in such filing that such information is to be considered “filed” or incorporated by reference therein.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	Investor Presentation

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.

	VALASSIS COMMUNICATIONS, INC.
	By:	/s/ Todd Wiseley
Date: October 1, 2009	Name:	Todd Wiseley
	Title:	General Counsel and Senior Vice President, Administration

Exhibit Index

Exhibit No.	Description
99.1	Investor Presentation

EX-99.1

®

Delivering Value to Consumers –

how, when and where they want

Deutsche Bank Leveraged Finance Conference

October 1, 2009

Exhibit 99.1

2

®

Safe Harbor

Certain

statements

found

in

this

document

constitute

“forward-looking

statements”

within

the

meaning

of

the

Private

Securities

Litigation

Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties and other factors which may

cause our actual results, performance or achievements to be materially different from any future results, performance or achievements

expressed or implied by such forward-looking statements. Such factors include, among others, the following: price competition from our

existing competitors; new competitors in any of our businesses; a shift in client preference for different promotional materials, strategies or

coupon

delivery

methods,

including,

without

limitation,

as

a

result

of

declines

in

newspaper

circulation;

an

unforeseen

increase

in

paper

or

postal

costs;

changes

which

affect

the

businesses

of

our

clients

and

lead

to

reduced

sales

promotion

spending,

including,

without

limitation, a decrease of marketing budgets which are generally discretionary in nature and easier to reduce in the short-term than other

expenses;

our

substantial

indebtedness,

and

ability

to

refinance

such

indebtedness,

if

necessary,

and

our

ability

to

incur

additional

indebtedness, may affect our financial health; the financial condition, including bankruptcies, of our clients, suppliers, senior secured credit

facility lenders or other counterparties; our ability to comply with or obtain modifications or waivers of the financial covenants contained in

our debt documents; certain covenants in our debt documents could adversely restrict our financial and operating flexibility; recent

disruptions in the credit markets that make it difficult for companies to secure financing; fluctuations in the amount, timing, pages, weight

and

kinds

of

advertising

pieces

from

period

to

period,

due

to

a

change

in

our

clients’

promotional

needs,

inventories

and

other

factors;

our

failure

to

attract

and

retain

qualified

personnel

may

affect

our

business

and

results

of

operations;

a

rise

in

interest

rates

could

increase

our

borrowing costs; we may be required to recognize additional impairment charges against goodwill and intangible assets in the future; the

outcome

of

ADVO’s

pending

shareholder

lawsuits;

our

current

litigation

with

News

America

Incorporated

has

been

and

may

continue

to

be

costly and may divert management’s attention; possible governmental regulation or litigation affecting aspects of our business; the credit

and liquidity crisis in the financial markets could continue to affect our results of operations and financial condition; reductions of our credit

rating

may

have

an

adverse

impact

on

our

business;

counterparties

to

our

secured

credit

facility

and

interest

rate

swaps

may

not

be

able

to fulfill their obligations due to disruptions in the global credit markets; uncertainty in the application and interpretation of applicable state

sales tax laws may expose us to additional sales tax liability; and general economic conditions, whether nationally, internationally, or in the

market areas in which we conduct our business, including the adverse impact of the ongoing economic downturn on the marketing

expenditures and activities of our clients and prospective clients as well as our vendors, with whom we rely on to provide us with quality

materials at the right prices and in a timely manner. These and other risks and uncertainties related to our business are described in

greater detail in our filings with the United States Securities and Exchange Commission, including our reports on Forms 10-K and 10-Q

and

the

foregoing

information

should

be

read

in

conjunction

with

these

filings.

We

disclaim

any

intention

or

obligation

to

update

or

revise

any forward-looking statements, whether as a result of new information, future events or otherwise.

3

®

*Revenue figures based on Valassis 2008 revenue.

Delivering value to consumers…

In-store

Industry Size: $1 billion

Strategy: Growth

Interactive

Industry Size: $10.3 billion

Strategy: Growth

Newspaper

Industry Size/Valassis Revenue*:

ROP: $18.3 billion/$187 million

FSI: $817 million/$370 million

Preprint: $6.4 billion/$240 million

Strategy: Grow Share

Sampling

Industry Size: $2.3 billion

Valassis Revenue*: $42 million

Strategy: Grow Share

Shared Mail

Direct Mail Industry Size: $59 billion

Valassis Revenue*: $1.37 billion

Strategy: Growth and Grow Share

how,

when

and

where

they

want

Shared Mail

Free-standing inserts (FSI) -

Co-op newspaper inserts

Coupon and promotion clearing

Canadian media operations

Sweepstakes/security consulting

In-store partnerships

Direct mail sampling/advertising

Loyalty marketing software

Internet-delivered promotions

Preprinted inserts

On-page newspaper advertising (ROP)

Newspaper polybag sampling/advertising

Door hanger sampling/advertising (Direct-to-Door)

Shared mail wrap

Targeted inserts

Saturation mail

List services

Neighborhood Targeted

Free-standing Inserts

International, Digital

Media & Services

$469.2M

$370.2M

$171.7M

$1,370.8M

2008 Revenue

2008 Total Revenue

$2,381.9M

$211.6M

$185.7M

$73.4M

$624.5M

YTD Revenue

as of 6/30/09

(unaudited)

YTD Total Revenue

$1,095.2M

-8.1% 1H09 vs. 1H08

Pro forma -6.7% vs. 1H08*

-11.6% 1H09 vs. 1H08

+1.5% 1H09 vs. 1H08

-0.9% 1H09 vs. 1H08

-18.0% 1H09 vs. 1H08

Pro forma

+8.9% 1H09 vs. 1H08*

*Excludes revenue from previously announced divested and discontinued operations.

5

®

Diversification -

2008

Revenue by Product

Revenue by Client

International,

Digital Media

& Services

7.1%

Free-standing

Insert

15.5%

Neighborhood

Targeted

19.5%

Shared Mail

57.9%

Consumer

Packaged Goods

16.9%

Specialty Retail

16.3%

Grocery, Mass

and Drug

18.3%

Restaurants

13.0%

Financial 4.2%

Discount

Stores

5.4%

Direct

Marketers

6.9%

Consumer

Services

8.4%

Telecom

5.7%

Satellite 2.0%

Other 2.9%

6

®

2009 Strategy

•

Successful management of 2009 Profit Maximization Plan

•

Focus on client retention and improved execution of cross

selling and new client acquisition

•

Further adoption of Integrated Media Optimization

•

Marketers need to move product and consumers seek deals

–

Valassis products drive traffic and move product

–

Research studies indicate the current economic environment will have

a more permanent effect on consumer behavior

–

Coupon redemption for the first half of 2009 is up 19% compared to

the first half of 2008

1

1

NCH Marketing Services, Inc. 2009 Mid-year Report.  NCH Marketing Services is our wholly-owned subsidiary.

7

®

Long-term Growth Strategy

•

Maintain and grow our core products and innovate with new

offerings

•

As newspaper coverage declines, Shared Mail and Online

are logical and effective solutions for newspaper-delivered

content

•

Value Proposition:

The only company to blend a one-of-a-

kind national shared mail network and newspaper

distribution

–

Leverage our proprietary targeting system (IMO) for effective  

media optimization

Execution = Long-term Profitable Revenue Growth

8

®

Guidance (increased July 30, 2009)

(1)

$245.0 million

Full-year

2009

Adjusted

EBITDA

(2)

*

Guidance

(1)

All data are as of July 30, 2009.  This guidance by management was based on the economic environment as of such date.  Actual results

may differ materially.  No reference (oral or written) to such data should be construed as an update, revision, confirmation or clarification

of same.

(2)

Adjusted EBITDA is a non-GAAP financial measure.  Important information regarding operating results and reconciliations of non-GAAP

financial

measures

to

the

most

comparable

GAAP

measures

may

be

found

in

the

“Reconciliation

of

Non-GAAP

measure”

on

slides

16-18.

•

Given continued success with our Profit Maximization

Plan and assuming no further economic downturns, we

increased full-year 2009 adjusted EBITDA* guidance

from $215 million

•

Capital expenditures expected to be between $15 and

$20 million

9

®

2009 Profit Maximization Plan (PMP)

$57.5 million

Total Profit Maximization Plan

$25.0 million

26.0 million

6.5 million

SG&A Reductions

Production Cost Savings

Underperforming Businesses

Note:

The $11 million of additional ADVO acquisition cost synergies projected for 2009 compared to

2008 ($49M vs. $38M) is included in the 2009 Profit Maximization Plan.

July 30, 2009 Update

Expect to exceed our PMP savings target of $57.5 million

by $20 -

$25 million

10

®

Capital Structure

($ in millions)

Cash and equivalents                                            

$  141.1

Senior Secured Debt:

Senior

Secured

Credit

Facility

–

fixed

portion

447.2

6.78%

3/31/2014

swaps expire 12/31/10

Senior

Secured

Credit

Facility

–

floating

portion

106.0

2.06%

(1)

3/31/2014 

LIBOR

+175

Senior Convertible Notes

.1

--

5/22/2033

interest no longer payable

Senior

Secured

Revolving

Credit

Facility

–

$100mm

(2)

0.0

2.56%

(1)

3/31/2012

LIBOR

+225

Total Secured Debt

$  553.3

Senior Unsecured Notes

540.0

8-1/4%

3/01/2015

fixed rate

Total Debt

$1,093.3

Total Net Debt

$   952.2

Current Market Capitalization

$   821.4

48,089m shares at 9/28/09

Total Capitalization

$1,773.6

As of

6/30/09

Rate

Due

Comments

closing price of $17.08

(1) Based on one-month LIBOR as of 6/30/09 of 0.31% plus spread.

(2) $100 million less approximately $10.5 million in letters of credit is current available credit.

11

®

Cash Flow and Interest Update -

First Half 2009

•

Cash flow from Operations for the first half of 2009 was

$123.4 million

•

Our cash interest expense for the second quarter was $19.0

million compared to $20.3 million for the first quarter

12

®

Capital Structure Update –

Thru September 30, 2009

•

As of 9/30/09 through “modified Dutch”

auctions*,

repurchased

$93.7 million of term loan B and delayed draw debt at a weighted

average discount to par of 11.0%, resulting in a gain of $9.4 million

after fees

•

Repaid $150.1 million of debt from 1/1/09 through 9/30/09

•

From 4/1/09 through 9/30/09, we switched to 1-month LIBOR from

3-month LIBOR, as the base interest rate for our term loan B and

delayed draw debts, achieving cash interest expense savings of

$313,000.  This switch resulted in the loss of hedge accounting

treatment of our interest rate swaps which caused a $4.2 million

($2.8 million in 3Q09 and $1.4 million in 2Q09) non-cash interest

expense related to the fair value of the interest rate swap contracts.

*See Valassis press release dated 1/26/09 and related Form 8-K filed with the SEC on 1/27/09 for 

complete details on credit agreement amendment.

®

Covenant Analysis

As of 6/30/09

Consolidated Senior Secured Leverage Ratio:

Senior Secured Debt

$553.3

Adjusted EBITDA (LTM)

(1)

$215.0

Covenant Ratio Level

(2)

3.75x

Consolidated Senior Secured Leverage Ratio

2.57x

Test

Pass

Covenant EBITDA Cushion %

31.5%

Consolidated Interest Coverage Ratio:

As of 6/30/09

Consolidated Interest Expense (LTM)

$83.1

Adjusted EBITDA (LTM)

(1)

$215.0

Covenant Ratio Level

(3)

1.75x

Consolidated Interest Coverage Ratio

2.59x

Test

Pass

Covenant EBITDA Cushion %

32.4%

(1)  Calculated pursuant to the terms of the senior secured credit facility for the trailing twelve-month period ended June 30, 2009.  Adjusted EBITDA

under the senior secured credit facility is calculated differently than the Company’s publicly disclosed Adjusted EBITDA because the senior

secured credit facility definition does not permit certain adjustments the Company has included in its publicly disclosed Adjusted EBITDA.

(2) Ratio decreases to 3.50x on Dec. 31, 2009.

(3) Ratio increases to 2.00x on Dec. 31, 2009.

($ in millions)

14

®

Why Invest in Valassis?

•

Consumer demand for value-oriented media and clients’

desire for measurable results

•

Value proposition

–

shared mail and newspaper blended solution

–

one-of-a-kind shared mail distribution

–

long-term newspaper coverage declines = shift to shared mail

(improved margins)

–

digital potential

•

Cross-sell opportunity

–

extensive product portfolio

–

expansive client base

•

Outperforming media peers on a revenue and profit basis

•

Low-cost capital structure

•

Cash flow yield

•

Experienced, results-oriented management team

®

Appendix

16

®

Reconciliation of Non-GAAP Measure

Non-GAAP Financial Measures

*We define adjusted EBITDA as earnings before net interest expense, other non-cash expenses (income), net, income taxes, depreciation,

amortization, stock-based compensation expense associated with SFAS No. 123R, non-recurring restructuring and severance costs and

amortization of a client contract incentive. Adjusted EBITDA is a non-GAAP financial measure commonly used by financial analysts, investors,

rating agencies and other interested parties in evaluating companies, including marketing services companies.  Accordingly, management

believes that adjusted EBITDA may be useful in assessing our operating performance and our ability to meet our debt service requirements.  In

addition, adjusted EBITDA is used by management to measure and analyze our operating performance and, along with other data, as our internal

measure for setting annual operating budgets, assessing financial performance of business segments and as a performance criteria for incentive

compensation. However, this non-GAAP financial measure has limitations as an analytical tool and should not be considered in isolation from, or

as an alternative to, operating income, cash flow or other income or cash flow data prepared in accordance with GAAP. Some of these limitations

are:

adjusted EBITDA does not reflect our cash expenditures for capital equipment or other contractual commitments;

although depreciation and amortization are non-cash charges, the assets being depreciated or amortized may have to be replaced in the future, and

adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements;

adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

adjusted EBITDA does not reflect the significant interest expense or the cash requirements necessary to service interest or principal payments on our

indebtedness;

adjusted EBITDA does not reflect income tax expense or the cash necessary to pay income taxes;

adjusted EBITDA does not reflect the impact of earnings or charges resulting from matters we consider not to be indicative of our ongoing operations; and

other companies, including companies in our industry, may calculate this measure differently and as the number of differences in the way two different

companies calculate this measure increases, the degree of its usefulness as a comparative measure correspondingly decreases.

Because of these limitations, adjusted EBITDA should not be considered as a measure of discretionary cash available to us to invest in the growth

of our business or reduce indebtedness. We compensate for these limitations by relying primarily on our GAAP results and using this non-GAAP

financial measure only supplementally.  Further important information regarding operating results and reconciliations of this non-GAAP financial

measure to the most comparable GAAP measures can be found below.

17

®

Adjusted EBITDA to Net Earnings and Cash Flow

from Operations

($ in millions)

Three Months Ended

Six Months Ended

6/30/2009

6/30/2009

Net Earnings -

GAAP

15.9

$                

29.0

$                

plus:

Income taxes

9.7

18.3

Interest expense, net

21.2

42.6

Depreciation and amortization

17.4

35.1

less:

Other non-cash income, net

(2.7)

(11.5)

EBITDA

61.5

$                

113.5

$             

Stock-based compensation expense

1.7

2.8

Restructuring costs/severance

1.8

2.6

Adjusted EBITDA

65.0

$                

118.9

$             

Interest expense, net

(21.2)

(42.6)

Income taxes

(9.7)

(18.3)

Restructuring costs, cash

(1.8)

(2.6)

Changes in operating assets and liabilities

51.4

68.0

Cash Flow from Operations

83.7

$                

123.4

$             

18

®

Reconciliation of 2009 Adjusted EBITDA Guidance

to 2009 Net Earnings Guidance

($ in millions)

Full-year 2009

Revised Guidance

Net Earnings

62.4

$                

plus:

Interest and other, net

82.4

Income taxes

39.2

Depreciation and amortization

66.9

less:

Other non-cash income

(15.8)

EBITDA

235.1

$              

plus:

Stock-based compensation expense

6.1

Non-recurring restructuring/severance

3.8

Company Publicly Disclosed Projected Adjusted EBITDA

245.0

$              

®

Delivering Value to Consumers –

how, when and where they want

Deutsche Bank Leveraged Finance Conference

October 1, 2009