Ziff Davis, Inc. · NASDAQ:ZD

Ziff Davis — j2 Global — Q1 2013 Earnings Presentation

26 slides from Ziff Davis's earnings presentation, May 9, 2013

  1. Slide 1: Investors Presentation (Based on First Quarter 2013 Results)

    > In vestors Presentation (Based on First Quarter 2013 Results) May 8, 2013 j> @ekax’ «Voice i’ “campaigner BiKeepltSafe’ Bonebox Baie

  2. Slide 2: Safe Harbor for Forward-Looking Statements

    (i2)) Safe Harbor for Forward-Looking Statements ~ Certain statements in this presentation are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, particularly those contained in the “2013 Guidance” slide. Such forward- looking statements are subj

  3. Slide 3: Risk Factors

    (j2)) 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 or profitability, particularly in light of an uncertain U.S. and worldwide economy and

  4. Slide 4: Financial Highlights

    ! i2) Financial Highlights j2) | Pefax ceVoice Zrusemait campaigner WKeepliSafe’ Wonebox ZZE

  5. Slide 5: CLOUD: Q1 2013 Non-GAAP Results

    2 CLOUD: Q1 2013 Non-GAAP Results S) Q12013 Non-GAAP $ Margin Revenues $90.7M Gross Profit/Margin $74.3M 81.9% Operating Profit/Margin $39.4M 43.4% EBITDA @) $45.0M 49.6% * 4.7% increase in revenue vs. prior comparable quarter * Revenue and Operating Margin in-line with j2 Cloud budget {1} EBITDA is

  6. Slide 6: MEDIA: Q1 2013 Non-GAAP Results

    MEDIA: Q1 2013 Non-GAAP Results Q1 2013 Non-GAAP $ Margin Revenues $22.9M Gross Profit/Margin $19.4M 84.7% Operating Profit/Margin $0.0M 0.0% EBITDA @) $3.2M 14.0% * Reflects partial quarter results for IGN (acquired February 1) * Q1 is seasonally the weakest quarter for the media business *° In-lin

  7. Slide 7: Consolidated: EBITDA to Non-GAAP Net Income Reconciliation

    Consolidated: EBITDA to Non-GAAP Net Income Reconciliation Q12013 Non-GAAP EBITDA - Cloud $45.0M EBITDA-Media $3.2M Total EBITDA $48.2M Less: Depreciation & amortization $8.8M Less: Interest income and expense, net $4.6M Pre-Tax Income $34.8M Tax Expense $8.0M Non-GAAP Net Income $26.8M (2) Non-GAAP

  8. Slide 8: Business Cloud Services

    ( j2)) Business Cloud Services j2) | Pefax ceVoice Zrusemait campaigner WKeepliSafe’ Wonebox ZZE

  9. Slide 9: Q1 2013 BCS Highlights

    Q1 2013 BCS Highlights * Online Fax: * Acquired MetroFax in March2013 * Corporate revenues up 9%+ YoY * Contract dollar value up 41% YoY * Number of new deals up 144% YoY * Corporate Telesales — Avg. DIDs per dealis up 3%, number of DIDs per month up 32% * Online Backup/ KeepitSafe® * Revenues up ~6

  10. Slide 10: Invest in Cross-Sell & Up-Sell: Database Marketing

    (j2 Invest in Cross-Sell & Up-Sell: Database Marketing + Launched Successful Cross-Sell Testin March 2011 + Increasing R&D Spend for People and Systems + Strong and Improving Cross-Sell Results + 37.6k New Accounts + $4,6M in Media Value + j2.com Cross-Sell Sites/1.0Mil visits/8.3K Signups Since Lau

  11. Slide 11: Intellectual Property Licensing

    Intellectual Property Licensing + Filed first patent application in 1997, with patentissuing in late 2000. « Launched patentlicensing program in 2004. + As reported in 8-K filed with SEC on 4/25/13, licensed patents for $27MM plus royalties if online SOHO sales thresholds are met. + To date, j2 has

  12. Slide 12: Digital Media

    ! i2) Digital Media j2) | Pefax ceVoice Zrusemait campaigner WKeepliSafe’ Wonebox ZZE 12

  13. Slide 13: Ziff Davis Overview Q1 2013 vs. Q1 2012

    2) Ziff Davis Overview Q1 2013 vs. Q1 2012 Web Traffic (1) Revenue & EBITDA () su sus 350 300 a ‘S au S na suo SS ‘ & so 8 Zs 3 = = sos 5 ¢ 7 * i 7 i e = 8 100 2 2 f ‘ai 2012 ‘01 2013 aad 397 sus Qi'12) Ql'l3 Qi'i2 = Qi'13 $0.6 ss Visits Page Views * Strong YoY Growth for Ziff Davis * 19% increase i

  14. Slide 14: IGN Integration Update

    j2) IGN Integration Update All plan reductions have occurred - integration ontrack Z\IFF Exited IPL, GameSpy, UGO & 1UP D AVI Ss Reduced headcount by 85 “4 Cut $2.3MMin non-staff operational expense Reduced rent cost by $1.4MM (annualized basis) j2. @kkax’ Voice &)FuseMail’ “campaigner WKeep\iSafe’

  15. Slide 15: 2013 Financial Outlook

    ! i2)) 2013 Financial | Outlook j2) | Pefax ceVoice Zrusemait campaigner WKeepliSafe’ Wonebox ZZE

  16. Slide 16: 2013 Guidance - Increasing Outlook

    2013 Guidance - Increasing Outlook * During Q2 2013, j2 closed a patent license agreement and received $27 million. j2 currently estimates it will generate fiscal 2013 revenues and earnings per diluted share associated with past damages from this transaction in amounts exceeding $10 million and $0.1

  17. Slide 17: Quarterly Dividend

    2) Quarterly Dividend ~ Quarterl idend Timing * Record Date — May 20th ° Payment Date - June 4th Payment Amount * $0.24 Per Share * ~$10M of Cash Designed Not to Impact Operational or M&A Activities j2)| Cetax’ (eVoice &FuseMail’ campaigner WKeepitSafe’ Wonebox Biske G

  18. Slide 18: Supplemental Information

    ( j2)) Supplemental Information j2) | Pefax ceVoice Zrusemait campaigner WKeepliSafe’ Wonebox ZZE 18

  19. Slide 19: j2 Cloud

    ‘j2Goud or ma er ee ete @ @ @ @ mn “otal GAAP Revenues ® wim se soso sso aes] Aastment § sone 2 2 9 soze 2 8 2 2 2 Total on GAAP Revenues i a7 sn ee ee __ ee es see Teed Subscriber Revenoes 7 wim em amas sea emo on) ans) anaes aoa \anable Subverber evens nage as2s7 aes eure tase santas Subserber Rev

  20. Slide 20: j2 Media

    ~ j2Media 2011 2012 2013 coy @ e a ry @ =e Ca ‘Qt Web Traffic Visits 4s 49 97 n 20 20 a2 108 27 Pageviews = 352 164 ast 242 2238 295 264 3a4 1249 32 Consolidated oT 202 EE) ore oF a oF 1 Total GAAP Revenues 573384 SB557E 585025 $85,072 585,652 $8545 593,285 1020033511317 Adjustment $10,328 30 2 2 0

  21. Slide 21: GAAP Reconciliation Free Cash Flow & EBITDA

    f j2 GAAP Reconciliation Free Cash Flow & EBITDA ~ ($ in millions) Free Cash Flow (1) art wn nari ae a2 ae oar | ars Net cash provided by operating activities $3153 $2398 sags «= sarsts| sze9 © sea s08.103 | ste.god] 40.088 Less: Purchases of propety and equprent ($0625) ($1880) ($2590) ($1.70) ($1.

  22. Slide 22: Q1 GAAP Reconciliation Non-GAAP Earnings & EPS

    (2) Q1 GAAP Reconciliation Non-GAAP Earnings & EPS ($ in thousands) THREE MONTHS ENDED MARCH 31, 2013 THREE MONTHS ENDED MARCH 34, 2012 2) io} Acqui (1) Share-based and Exit Share-based GAAP Compensation Costs. Non.GAAP GAAP Compensation Revenues 113,617 - (44) 113,573 86,652 - = 26,652 Cost of reve

  23. Slide 23: Cloud & Media GAAP Reconciliation EBITDA

    f j2 )) cloud & Media GAAP Reconciliation EBITDA EBITDA CLOUD & MEDIA Q1 2013 (1) CLOUD MEDIA Net income (loss) $25.9M ($3.1M) Interest and other expense, net $3.3M $1.4M Income tax expense (benefit) $7.8M (823M) Depreciation and amortization $5.6M $3.2M Reconciliation of GAAP to Non-GAAP financial

  24. Slide 24: Ziff Davis GAAP Reconciliation EBITDA

    ($ in thousands) (j2)) Ziff Davis GAAP Reconciliation EBITDA EBITDA (1) Qii2 aris Net income (loss) (146) (61565) Interest and other expense, net $38 $1,349] Income tax expense (benefit) ($268) (1,184) Depreciation and amortization S776 $2,212] Reconciliation of GAAP to Non-GAAP financial measures:

  25. Slide 25: j2 Note Ratios & Covenants

    j2 Note Ratios & Covenants $250 Million Senior Unsecured Notes 3/31/2013 Actual % of Total Total Cash & Investments $ 310.1 Total Debt s 250.0 11.5% Total Market Capitalization $ 1,919.8 88.5% EBITDA -LTM 3/31/13 2 $ 193.4 Ratios Leverage Ratio - Debt / EBITDA LTM 1.29x Fixed Charge Ratio - EBITDA L

  26. Slide 26: j2 eFax’ (eVoice ®&X|FuseMail’ “campaigner WMKeep\tSafe’ Wonebox Bais

    j2 eFax’ (eVoice ®&X|FuseMail’ “campaigner WMKeep\tSafe’ Wonebox Bais

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