Ziff Davis, Inc. · NASDAQ:ZD
Ziff Davis — J2 Global Communications — FY2006 Earnings Presentation
24 slides from Ziff Davis's earnings presentation, Mar 13, 2007
Slide 1: Investor Presentation (Based upon Year End 2006 results)
www.j2global.com Investor Presentation (Based upon Year End 2006 results) March 12, 2007 1
Slide 2: Safe Harbor for Forward-Looking Statements
Safe Harbor for Forward-Looking Statements Certain statements in this presentation constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, particularly those contained in the slide entitled “Financial Guidance.” These forward-looking statem
Slide 3: Risk Factors
Risk Factors The following factors, among others, could cause our business, prospects, financial condition, operating results and cash flows to be materially adversely affected: Inability to sustain growth in our customer base, revenue or profitability Competition in price, quality, features and geo
Slide 4: Messaging as a Service
Messaging as a Service All brand names and logos are trademarks of j2 Global Communications, Inc. or its affiliates in the U.S. and/or internationally. 4
Slide 5: Core j2 Global Assets
Core j2 Global Assets 11.2 million subscribed telephone numbers (DIDs) Global advanced messaging network >2,700 cities in 37 countries on 5 continents 16.4 MM+ unique DIDs worldwide in inventory Patented technology A portfolio of 49 issued patents, and numerous pending U.S. and foreign patent applic
Slide 6: Subscriber Acquisition
Subscriber Acquisition Individuals Targeted Web marketing (e.g. AOL, Google, Monster, MSN, Yahoo!) Sold primarily through: www.eFax.com , www.j2.com, www.onebox.com and www.evoice.com Use of proprietary Life Cycle Management Advertising & Calling-Party-Pays revenue supports the Free base Small to Mi
Slide 7: Paid Subscription Drivers
Paid Subscription Drivers Six Drivers for Paid DID Additions Subscribers coming directly to the Company’s Websites/Telesales Brand awareness driven by demand-generation programs and “word of mouth” Search engine discovery Accounts for ~50% of monthly paid DID signups Free-to-Paid subscriber upgrades
Slide 8: Service Roadmap
Service Roadmap All brand names and logos are trademarks of j2 Global Communications, Inc. or its affiliates in the U.S. and/or internationally. 8
Slide 9: eFax Domestic Price Increase
eFax Domestic Price Increase 9
Slide 10: eFax Plus Successful Price Change History
eFax Plus Successful Price Change History Review Pricing every 2 to 3 Years Consider feature set, market conditions, and comparable value 2001: Increase price to match customer value From $2.95/$4.95 to $9.95 Phased approach to ease implementation and monitor results Successful rollout across custom
Slide 11: eFax Price Change - Recent Milestones
eFax Price Change - Recent Milestones Q2 2006: Testing of Packages Various price points & feature sets tested for conversion & retention July 2006: Decision $16.95 monthly, $169.50 annual, 160 included pages selected, 30 send Domestic “web” customers only Q3 2006: Price change to new customers begin
Slide 12: eFax Price Change - Current Status/Next Steps
eFax Price Change - Current Status/Next Steps New Customers Signup on New Pricing > 90% at $16.95 (monthly) or $169.50 (annual) in January Existing customer base continues to migrate to new pricing ~ 40% at end of Q4 2006 ~ 60% at end of Q1 2007 ~ 90% at end of Q2 2007 Increased Cancels within Range
Slide 13: Financial Highlights
j2),Global Financial Highlights 8 J), ctobat communications, nc.
Slide 14: GAAP Reconciliation
GAAP Reconciliation j2 GLOBAL COMMUNICATIONS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) TWELVE MONTHS ENDED DECEMBER 31,2006 Non-GAAP Reported Entries Non-GAAP Revenues Subscriber $ 175,171 $ - $ 175,171 Other 5,908 0 5,908 Tota
Slide 15: 2006 Modified Financial Results
2006 Modified Financial Results Margin Revenue $181.1 Mil Gross Profit/Margin (1) $144.9 Mil 80.0% Operating Profit/Margin (2) $77.7 Mil 42.9% Modified EPS(2) $1.19 Per Share (1) Gross profit/margin excludes expenses related to stock based compensation and charges for payroll tax and employee compen
Slide 16: Historical Revenue & Operating Earnings Growth
Historical Revenue & Operating Earnings Growth 11 consecutive year of Revenue growth 5 consecutive years of Operating Earnings growth 16
Slide 17: Modified Margin Trends by Year
Modified Margin Trends by Year Operating earnings for 2004 to 2006 is based on Modified earnings. See 17 Slides 14, 22, and 23 for reconciliation to the nearest GAAP financial measure.
Slide 18: Financial Guidance
Financial Guidance Q1 Fiscal Year 2007 2007 Revenues (millions) $51.1 - $52.1 $217 - $229 Modified EPS (1) $0.32 - $0.33 $1.35 - $1.45 (1) Excludes non-cash compensation expense for SFAS 123(R) and excess accounting fees related to restatement of prior years financials. Assumes an effective annual t
Slide 19: Supplemental Information
Supplemental Information 19
Slide 20: Metrics
Metrics 2005 2006 Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Q4 Total Fixed Subscriber Revenues $22,773 $23,756 $25,229 $26,963 $98,721 $28,537 $29,855 $32,179 $36,013 $126,586 Variable Subscriber Revenues 8,502 10,323 11,258 10,901 40,985 12,025 12,816 12,312 11,433 48,585 Subscriber Revenues $31,275 $34,079 $36,4
Slide 21: Computation of Free Cash Flow
Computation of Free Cash Flow ($ in millions) Q1 '05 Q2 '05 Q3 '05 Q4 '05 Q1 '06 Q2 '06 Q3 '06 Q4 '06 Net cash provided by operating activities $13.762 $15.227 $15.951 $19.405 $19.245 $14.250 $13.607 $25.903 Purchases of property & equipment (2.473) (1.420) (2.433) (2.602) (0.757) (3.288) (1.181) (1
Slide 22: GAAP Reconciliation
GAAP Reconciliation j2 GLOBAL COMMUNICATIONS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) TWELVE MONTHS ENDED DECEMBER 31,2005 Non-GAAP Reported Entries Non-GAAP Revenues Subscriber $ 139,706 $ - $ 139,706 Other 4,235 0 4,235 Tota
Slide 23: GAAP Reconciliation
GAAP Reconciliation j2 GLOBAL COMMUNICATIONS, INC. UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS) TWELVE MONTHS ENDED DECEMBER 31,2004 Non-GAAP Reported Entries Non-GAAP Revenues Subscriber $ 103,160 $ - $ 103,160 Other 3,183 0 3,183 Tota
Slide 24: Global
j2) Global
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