Slide 1: Fourth Quarter 2018 Results
F O U R T H Q U A R T E R 2 0 1 8 R E S U LT S F e b r u a r y 1 3 , 2 0 1 9
Slide 2: Safe Harbor for Forward-Looking Statements
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 regarding our 2019 Financial Guidance. Such forward-looking statements are subject to num
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 or profitability, and any related impact of U.S. or worldwide economic issues on customer ac
Slide 4: Q4 Consolidated Financial Snapshot
Q4 Consolidated Financial Snapshot (1) Revenue Adjusted Gross Profit (2) (in millions) (in millions) Q4 2017 316,380,047 9.4% 7.2% $346.1 $290.7 Q4 2017 $271,116,834 $316.4 $271.1 Q4 2017 $141,879,154 Q4 2017 Q4 2018 Q4 2017 Q4 2018 Q4 2017 $1.79 Adjusted EBITDA (2) Adjusted EPS (2) (in millions) $2
Slide 5: FY 2018 Consolidated Financial Snapshot
FY 2018 Consolidated Financial Snapshot (1) Revenue Adjusted Gross Profit (2) FY 2017 (in millions) (in millions) 1,117,837,852 8.0% $1207.3 6.3% $1009.3 FY 2017 $1117.8 $949.1 $949,136,299 FY 2017 $462,951,882 FY 2017 FY 2018 FY 2017 FY 2018 FY 2017 $5.64 Adjusted EBITDA (2) Adjusted EPS (2) (in mi
Slide 6: Adjusted EBITDA and Free Cash Flow
Adjusted EBITDA and Free Cash Flow (1) Adjusted EBITDA (2) Q4 Y/Y'17 FCFvs Q4 '18 (2) 2013 (in millions) (in millions) 220,446,000 8.7% $154.3 Q4 2017 $489.5 141,879,154 $463.0 $141.9 $396.1 $333.3 $262.6 $220.4 2013 $150,393,000 2013 2014 2015 2016 2017 2018 Q4 2017 Q4 2018 Q4 2017 $75,311,201 Free
Slide 7: Q4 2018 Financial Snapshot By Business
Q4 2018 Financial Snapshot By Business (1) CLOUD SERVICES ``` DIGITAL MEDIA Revenue Revenue (in millions) (in millions) 0.8% $146.9 $148.1 $198.0 16.8% $169.5 Q4 2017 Q4 2018 Q4 2017 Q4 2018 Adjusted EBITDA (2) Adjusted EBITDA (2) (in millions) (in millions) -1.3% Includes Includes ($1.7MM) ($1.8MM)
Slide 8: FY 2018 Financial Snapshot By Business
FY 2018 Financial Snapshot By Business (1) CLOUD SERVICES ``` DIGITAL MEDIA Revenue Revenue (in millions) (in millions) 3.3% 13.1% $609.3 $598.0 $578.9 $538.9 FY 2017 FY 2018 FY 2017 FY 2018 Adjusted EBITDA (2) Adjusted EBITDA (2) (in millions) (in millions) Includes -1.3% Includes ($5.9MM) ($6.1MM)
Slide 9: Financial Guidance
2019 FINANCIAL GUIDANCE
Slide 10: 2019 Outlook (Forward-Looking Statements)
2019 Outlook (Forward-Looking Statements) Cloud Services • Revenue growth expected to be ~5% • EBITDA(1)(2) margin in line with prior year • Additional depreciation due to capital expenditures in the Fax and Backup business units, as well as the full- year impact of M&A completed in 2018 Digital Med
Slide 11: 2019 Guidance (Forward-Looking Statements)
2019 Guidance (Forward-Looking Statements) Revenues $1,290MM - $1,330MM Adjusted EBITDA(1)(2) $520MM - $540MM Adjusted Non-GAAP EPS(1)(2) $6.65 - $6.95 (1) Figures are adjusted non-GAAP. 11 (2) Adjusted earnings per diluted share excludes share-based compensation, amortization of acquired intangible
Slide 12: Supplemental Information
"SUPPLEMENTAL INFORMATION
Slide 13: Consolidated Metrics
Consolidated Metrics 2017 2018 j2 Consolidated Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Revenue by Business I--(in '000s)--I Cloud Services Revenues $141,544 $144,709 $145,787 $146,916 $149,485 $150,297 $150,094 $148,099 Digital Media Revenues $113,125 $128,465 $127,829 $169,464 $131,137 $137,591 $142,628 $197,958 C
Slide 14: Cloud Services & Digital Media Metrics
Cloud Services & Digital Media Metrics 2017 2018 Cloud Services Metrics Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Revenue by Type Fixed Subscriber Revenues $115,726 $117,556 $118,755 $119,232 $120,840 $123,648 $123,111 $121,350 I------------------ (in '000s) ------------------I Variable Subscriber Revenues $24,606 $2
Slide 15: Return on Invested Capital (ROIC) Calculation
Return on Invested Capital (ROIC) Calculation Cumulative Cumulative Invested ROIC FCF (3) / Cumulative Adjusted Free Cash (3) ROIC FCF (3) / IEC (4) & Net (4) Spend / Adjusted FCF since Equity Capital (IEC & Net Spend (1) EBITDA (2)(3) Flow (FCF) (3) IEC (4) Debt (5) (in Millions) EBITDA (3) 2008 (I
Slide 16: Q4 and FY 2018 Reconciliation of GAAP to Adjusted Non-GAAP Earnings & EPS
Q4 and FY 2018 Reconciliation of GAAP to Adjusted Non-GAAP Earnings & EPS (1) Figures in Thousands Three Months Ended December 31, Twelve Months Ended December 31, 2018 2017 2018 2017 Cost of revenues $ 55,962 $ 45,974 $ 201,074 $ 172,313 Plus: Share based compensation (1) (132) (143) (510) (500) (2
Slide 17: GAAP Reconciliation Free Cash Flow
GAAP Reconciliation Free Cash Flow(1) (2) Figures in Thousands 2013 2014 2015 2016 2017 2018 Q4 2017 Q4 2018 Net cash provided by operating activities $ 193,324 $ 177,231 $ 229,061 $ 282,387 $ 264,420 $ 401,325 $ 85,424 $ 107,209 Less: Purchases of property and equipment (18,626) (11,221) (17,297) (
Slide 18: GAAP Reconciliation Adjusted EBITDA
GAAP Reconciliation Adjusted EBITDA(1) (2) Three Months Ended December 31, Twelve Months Ended December 31, Figures in Thousands 2018 2017 2018 2017 Net Income $ 50,614 $ 49,871 $ 128,687 $ 139,425 Plus: Interest expense, net 15,559 16,372 61,987 67,777 Other (Income) expense, net (1,443) (22,696) 4
Slide 19: Q4 2018 Reconciliation of GAAP to Adjusted EBITDA
(1) Q4 2018 Reconciliation of GAAP to Adjusted EBITDA Figures in Thousands Cloud Services Digital Media Corporate Total Revenues GAAP revenues $ 148,099 $ 197,958 $ 2 $ 346,059 Gross profit GAAP gross profit $ 119,394 $ 170,701 $ 2 $ 290,097 Non-GAAP adjustments: Share-based compensation 130 2 - 132
Slide 20: Q4 2017 Reconciliation of GAAP to Adjusted EBITDA
(1) Q4 2017 Reconciliation of GAAP to Adjusted EBITDA Figures in Thousands Cloud Services Digital Media Corporate Total Revenues GAAP revenues $ 146,916 $ 169,464 $ - $ 316,380 Gross profit GAAP gross profit $ 117,314 $ 153,092 $ - $ 270,406 Non-GAAP adjustments: Share-based compensation 143 - - 143
Slide 21: FY 2018 Reconciliation of GAAP to Adjusted EBITDA
(1) FY 2018 Reconciliation of GAAP to Adjusted EBITDA Figures in Thousands Cloud Services Digital Media Corporate Total Revenues GAAP revenues $ 597,975 $ 609,314 $ 6 $ 1,207,295 Gross profit GAAP gross profit $ 475,821 $ 530,395 $ 5 $ 1,006,221 Non-GAAP adjustments: Share-based compensation 506 4 -
Slide 22: FY 2017 Reconciliation of GAAP to Adjusted EBITDA
(1) FY 2017 Reconciliation of GAAP to Adjusted EBITDA Figures in Thousands Cloud Services Digital Media Corporate Total Revenues GAAP revenues $ 578,956 $ 538,882 $ - $ 1,117,838 Gross profit GAAP gross profit $ 460,210 $ 485,315 $ - $ 945,525 Non-GAAP adjustments: Share-based compensation 500 - - 5
Slide 23: j2 Global
j2 Global