Ziff Davis, Inc. · NASDAQ:ZD
Ziff Davis — J2 Global Communications — Jefferies & Co. Communications & Media Conference 2004
21 slides from Ziff Davis's conference presentation, Sep 23, 2004
Slide 1: Jefferies & Co. Communications & Media Conference
Jefferies & Co. Communications & Media Conference (Based upon Second Quarter 2004 results) September 23, 2004 www.j2global.com
Slide 2: Safe Harbor for Forward-Looking Statements
Future operating results Subscriber growth and retention Earnings growth and expectations New products, services and features Corporate spending Liquidity Network capacity and coverage Regulatory developments Taxes Certain statements in this presentation constitute “forward-looking statements” withi
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 Inability to obtain telephone numbers in sufficient quantities on acceptable terms in desirable locations Enactment of burdensome telecommunications
Slide 4: j2 Global deploys the power of the Internet
j2 Global deploys the power of the Internet to deliver business critical communication and messaging services to individuals and corporations throughout the world.
Slide 5: Trademark notice
All brands names and logos are trademarks of j2 Global Communications, Inc. in the U.S. and/or internationally.
Slide 6: Unique Assets
Unique Assets 7.3 million subscribed telephone numbers (DIDs) Global advanced messaging network 1,350+ cities in 20 countries on 5 continents 9.5MM+ unique DIDs worldwide in inventory Patented technology More than 17 issued U.S. and foreign Patents and numerous patents pending Expertise Highly effec
Slide 7: Subscriber Profile
Subscriber Profile Vertical Markets Financial institutions Real estate Law firms & corporate legal departments Medical Government Hospitality Remote workers & “road warriors” Value Proposition Digitization (paper reduction) Security Privacy Efficiency Cost Infrastructure replacement
Slide 8: Subscriber Acquisition
Subscriber Acquisition Individuals Targeted Web marketing (e.g. AOL, Yahoo!, Google, Lycos, etc.) Sold through: www.eFax.com and www.j2.com Use of proprietary Life Cycle Management (i.e. Free Paid conversions) Advertising & Calling-Party-Pays revenue supports the Free base Small to Mid-Sized Busines
Slide 9: Paid Subscription Drivers
Paid Subscription Drivers Five drivers for Paid subscription additions: Subscribers coming directly to the Company’s Websites Brand awareness Search engine discovery Free-to-Paid subscriber upgrades Life Cycle Management eFax Corporate SME sales Hybrid Website and human interaction (i.e. Telesales)
Slide 10: Active Telephone Numbers (DIDs) & ARPU
$15.52 $15.36 $15.73 $16.68 $0.05 $0.05 $0.05 $0.04 $17.22 $0.04 Active Telephone Numbers (DIDs) & ARPU * Defined as individual customer DIDs with greater than 4 months of continuous service (continuous service includes customer DIDs which are administratively cancelled and reactivated within a cale
Slide 11: Total Revenues
Total Revenues Core Total Revenues focus DID based revenues Q2 Q3 Q4 Q1 Q2 DID based ($M) 15,835 17,478 19,216 21,664 24,057 % of Total Revenues 92.9% 92.5% 93.9% 94.4% 93.1% % Growth 12.6% 10.4% 9.9% 12.7% 11.0% TTM Growth 53.5% 53.6% 52.5% Non-DID based ($M) 1,202 1,424 1,257 1,278 1,774 % of Tota
Slide 12: Product Roadmap
Product Roadmap Inbound Fax to Email Outbound Fax via Email Fax broadcasting Secure fax OCR PDF delivery Fax storage/archive New notification methods Voice Services Inbound VM to Email Voicemail management Telephone access Conference Calling Enhanced voicemail Find me/Follow me Call screening Voicem
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Slide 14: Historical Revenue & Operating Income Growth
Historical Revenue & Operating Income Growth 29 consecutive quarters of revenue growth 10 consecutive quarter of earnings growth
Slide 15: Quarterly Revenues
Quarterly Revenues Q2 Q3 Q4 Q1 Q2 Subscriber $16,307 $17,806 $19,517 $22,062 $25,063 12.8% 9.2% 9.6% 13.0% 13.6% Advertising -0.6% 11.9% 18.4% -5.6% -15.0% Licensing and Other Total Revenues $17,037 $18,903 $20,474 $22,942 $25,831 12.0% 11.0% 8.3% 12.1% 12.6% Quarter-to-Quarter Growth Quarter-to-Qua
Slide 16: Subscriber Revenues
Subscriber Revenues Core Subscriber Revenues focus Fixed revenues Q2 Q3 Q4 Q1 Q2 Fixed ($M) 11,177 12,121 13,976 16,021 17,750 % of Subs. Revenues 68.5% 68.1% 71.6% 72.6% 70.8% % Growth 12.7% 8.4% 15.3% 14.6% 10.8% TTM Growth 54.4% 56.3% 57.2% Variable ($M) 5,130 5,685 5,542 6,041 7,314 % of Subs. R
Slide 17: Percentage of Total Revenue
(Percentage of Total Revenue) 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 81.5% 0c __815%_82,0%0__ Ne om ae a Gross Margin on agave 42.690 39,200 # Operating Margin G&A — Sales & Markél Engineering 8 03 Q4 03 Qi ‘04 Q2'04 2) wan canminsanncine
Slide 18: Earnings & Free Cash Flow
(1) Earnings & Free Cash Flow (1) Excludes benefit of $9.5 million to record the reversal of certain valuation allowances of our deferred tax assets. (2) Net cash provided by operating activities, less purchases of property & equipment. Free Cash Flow amounts are not meant as a substitute for GAAP,
Slide 19: 2004 Financial Guidance
2004 Financial Guidance (Reaffirmed 9/23/04) (1) Assumes an effective 35% annual tax rate and diluted shares of 25,709,879 as of July 15, 2004 $1.00 – $1.18 $0.31 Net Earnings per Fully-Diluted Share (1) $1.65 – $1.83 $0.48 Earnings Before Taxes per Fully-Diluted Share $100 – $106 $27.4 – $27.8 Reve
Slide 20: Recent Events
Recent Events Acquired most of the assets of Call Sciences LTD, including their Onebox ™ unified messaging business Launched j2 Global’s first major credit card marketing partnership with Advanta Corporation, a leading issuer of business credit cards to small businesses
Slide 21: j2 Global
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