Slide 1: Investor Presentation (Based upon Third Quarter 2007 results)
Investor Presentation (Based upon Third Quarter 2007 results) November 7, 2007
Slide 2: Safe Harbor for Forward-Looking Statements
Future operating results Subscriber growth, retention and usage levels International, Corporate and Voice Service growth New products, services and features Corporate spending Liquidity Network capacity, coverage and security Regulatory developments Taxes Certain statements in this presentation cons
Slide 3: Risk Factors
Risk Factors Inability to sustain growth in our customer base, revenue or profitability Competition in price, quality, features and geographic coverage Higher than expected tax rates or exposure to additional tax liability Inability to obtain telephone numbers in sufficient quantities on acceptable
Slide 4: 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. Messaging as a Service
Slide 5: Core j2 Global Assets
Core j2 Global Assets 11.7 million Subscribed Telephone Numbers (DIDs) 1,017,985 Paid DIDs Global Advanced Messaging Network > 2,900 cities in 42 countries on 5 continents 17.1MM + unique DIDs worldwide in inventory Patented Technology A portfolio of 54 issued patents, and numerous pending U.S. and
Slide 6: Subscriber Acquisition
Individuals Targeted marketing (search, online media and radio) Sold through: eFax.com , j2.com , fax.com , onebox.com , evoice.com and other brand websites Use of proprietary Life Cycle Management Advertising & Calling-Party-Pays revenue supports the Free base Small to Mid-Sized Businesses (SMBs) S
Slide 7: Six Drivers for Paid DID Additions
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 over 40% monthly paid DID signups Free-to-Paid subscriber upgrades Life Cycle Management eF
Slide 8: Global
Global j2 ), Communications j2Global Communica
Slide 9: Voice Services Update
Voice Services Update Voice Services Paid DIDs Represents ~ 7.5% of the Paid DID Base at October 2007 vs. ~ 5% at Q2 2007 DID Growth Rate from Q2 - Q3 2007 > 32%, YoY > 128% Receptionist ARPU is ~ $12.00 per DID per Month Current Target Customer is SMB with 2-15 Persons Marketing Consists Primarily
Slide 10: Corporate Sales Update
Q3 YoY DID growth > 21% SMB growth > 23% Fortune 100 Customers Increased 78% YoY to 41 3 Large Accounts Signed in Q3, Bringing Total to 35 50 Large Accounts in the Pipeline (8 in Europe) Corporate Sales Update
Slide 11: International Web Update
Q3 YoY DID growth > 40% Launching Localized Receptionist Service in Early Continuing Investment in International Business Currently 7 languages available Multi-byte capability expected in 2008 Localized services and physical presence in Asia in 2008 (Japan first) Q3 YoY EU employee growth from 29 to
Slide 12: Global
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Slide 13: Q3 2007 Non-GAAP Financial Results
GAAP Revenues $55.7 MM Gross Profit/Margin (1) $44.7 MM 80.3% Operating Profit/Margin (1) $23.1 MM 41.5% Non-GAAP EPS $0.38 Per Share Free Cash Flow (3) $15.7 MM Cash and Investments $240 MM Margin (1) Excludes SFAS 123(R) non-cash compensation expense. See slide 19 for a reconciliation to the neare
Slide 14: Margin Trends by Year
Operating margins for 2004 to 2006 are based on Modified earnings. Q1 2007 to Q3 2007 excludes SFAS 123(R) non-cash compensation, net of tax benefit. See slides 19 and 20 for reconciliations to the nearest GAAP financial measures. Margin Trends by Year
Slide 15: Financial Guidance
Financial Guidance (1) Excludes SFAS 123(R) non-cash compensation, net of tax benefit. Assumes an effective annual tax rate of approximately 30% and 51.4 million fully diluted shares outstanding. $0.36 - $0.37 $56.1 - $57.6 Q4 Non-GAAP EPS (1) Revenues (MM) 2008 Outlook Expect revenue to Grow ~ 17%
Slide 16: Global
Global j2 ), Communications j2Global Communica
Slide 17: Financials
Revenues DIDs Financials Global ), Communications
Slide 18: Computation of Free Cash Flow
(1) Net cash provided by operating activities, less purchases of property & equipment. Free Cash Flow amounts are not meant as a substitute for GAAP, but are solely for informational purposes. Computation of Free Cash Flow ($ in millions) Q1 '06 Q2 '06 Q3 '06 Q4 '06 Q1 '07 Q2 '07 Q3 '07 Net cash pro
Slide 19: GAAP Reconciliation
GAAP Reconciliation (1) Stock-based compensation is as follows: for Q3, Cost of revenues is $169K, Sales and Marketing is $304K, R&D is $186K, and G&A is $1,209K, for Q2, Cost of revenues is $140K, Sales and Marketing is $264K, R&D is $184K, and G&A is $1,114K and for Q1, Cost of revenues is $182K,
Slide 20: GAAP Reconciliation
GAAP Reconciliation (1) Stock-based compensation and charges for payroll tax and employee compensation liabilities associated with inadvertent measurement date errors in prior stock option grants are as follows: 2006 Adjustments - Cost of revenues is $571K, Sales and Marketing is $1,236K, R&D is $75
Slide 21: Usage Pattern of Corporate and Web High Volume Users
Usage Pattern of Corporate and Web High Volume Users
Slide 22: Global
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