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March 2004

…A GROWTH COMPANY. March 2004. Safe Harbor.

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March 2004

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  1. …A GROWTH COMPANY March 2004

  2. Safe Harbor The statements in this presentation are “forward looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are based on current expectations, are not strictly historical statements, and may differ materially from actual results. Forward looking statements include without limitation, those regarding management's plans, goals, expectations, guidance, objectives, strategy, and timing for future operations and products such as product plans and performance, predictions or expectations of future growth, management's assessment of market factors, currency exchange rates, the availability of financing and future financial performance. Among factors that could cause actual results to differ materially are changes in business conditions; changes in the telecommunications or Internet industry or the general economy or capital markets; DSL, Internet and fixed line and wireless telecom competition; changes in service offerings or business strategies; fluctuations in currency exchange rates; difficulty in provisioning Voice over IP services; changes in the regulatory schemes and regulatory enforcement in the markets in which we operate; restrictions on our ability to follow certain strategies or complete certain transactions as a result of our capital structure or debt covenants; the possible inability to raise capital when needed, or at all; the inability to reduce debt significantly; risks associated with PRIMUS's limited DSL, Internet and web-hosting experience and expertise, entry into developing markets, the possible inability to hire and/or retain qualified sales, technical and other personnel, and managing rapid growth; and risks associated with international operations (including foreign currency translation risks); dependence on effective information systems; dependence on third parties to enable us to expand and manage our global network and operations; and dependence on the performance of PRIMUS's global ATM+IP communications network. These factors are discussed more fully in PRIMUS's public filings, including its most recent 10Q and 10K filings with the Securities and Exchange Commission. Readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date these statements were made. PRIMUS disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

  3. Company Overview

  4. Our Business Global, facilities-based telecommunications service provider offering international and domestic voice, Internet and data services to business and residential retail customers in select countries in North America, Asia-Pacific and western Europe utilizing our world-class broadband global network

  5. 5% Quarterly Growth Rate 2% Quarterly Growth Rate Track Record of Financial Success Revenue Gross Margin (%) Income from Operations (1) Total Debt 59% Quarterly Growth Rate • Excludes Asset Impairments.

  6. Building Scale in Key Markets Targeting Profitable Segments in Select Markets _______________ (1) Annualized based on the results for the three months ended December 31, 2003.

  7. Fully Built Global Network Copenhagen London Frankfurt Amsterdam Vancouver Toronto Paris Milan Tokyo Jersey City New York Madrid Los Angeles New Delhi Puerto Rico Brisbane Perth Sao Paulo Adelaide Sydney Melbourne IRU – Fiber Capacity International Gateway Switch Domestic Switch Satellite Link

  8. Global Diversification Reduces Business Risk Revenue by Geographic Region for 3 Months Ended 4Q03

  9. PRIMUS’ Customer Base is Diversified Revenue by Customer Segment for 3 Months Ended 4Q03

  10. Full Suite of Services Voice Data _______________ * New Growth Areas

  11. Financial Overview

  12. Financial Summary Annual Financial Results ____________________ (1) After bad debt. (2) Excludes asset impairment write-down and loss on sale of assets. (3) Free cash flow consists of net cash provided by (used in) operating activities less net cash used in investing activities.

  13. Growing Revenue • Revenue growth across all markets • Residential and business revenue growth • Core long distance voice and data; additional local bundling • Prepaid services increasing • VoIP provides an additional revenue source and improves Carrier gross margins • Data/Internet growing steadily • Bundling of VoIP, Local, LD, and Cellular Revenue by Product Revenue by Customer Type ($ in millions) ($ in millions)

  14. Gross Margin Improvement PRIMUS Gross Margin Percentage * PRIMUS Average Price Per Minute 1999 2000 2001 2002 2003 ___________________________ *After bad debt. Note: Excludes one-time items.

  15. Income from Operations Improvement • Positive Income from Operations since Q102 Income from Operations (1) ($ in millions) ____________________ (1) Excludes asset impairments.

  16. Free Cash Flow • Completed global network infrastructure deployment • Additional capex beyond current levels will be success based • Business plan not contingent on significant network expansion Free Cash Flow CapEx ($ in millions) FCF ($ in millions)

  17. Leverage Improvement • Total debt and interest expense reduced nearly 60% Total Debt Interest Expense ($ millions) ($ millions) * 3Q03 Total Debt and Interest Expense include non-recurring charges related to early retirement of debt.

  18. PRIMUS IS a Growth Company • 2003 Revenue growth of 26% over 2002 • Revenue has grown in each of the last 8 quarters • 2003 Income from Operations of $70MM • Positive Net Income in 2003 and projected to grow faster (on a percentage basis) than Income from Operations

  19. 2004 Financial Guidance • Annual Net Revenue Growth in the Range of 12% to 15% • Income From Operations to Grow in the Range of 40% to 50% • Incremental SG&A spending of $20-25 million for new initiatives (VoIP, Wireless and Local) • Income Tax Expense of approximately $20 million • Net Income in the Range of $20 Million to $25 million * • EPS in the range of $.20 to $.25 per fully diluted share * • Capital Expenditures in the range of 3% of Net Revenue * Including approximately $15 million of costs associated with the early extinguishment of debt and related interest expense

  20. Investment Highlights • Track record of operational and financial success • Business plan focused on core markets and select customer segments • Fully funded business plan and strong balance sheet poised for further deleveraging • Well positioned to capitalize on further growth opportunities

  21. …And There is Upside Potential Future EPS Drivers: • Revenue growth • Organic growth areas beyond our LD core business: • Local • Retail VoIP • Wireless Dial Around Service • Higher mix of high margin Internet and VoIP services • Further cost and debt reduction programs • Opportunistic refinancing to lower interest expense and increase cash flow

  22. …A GROWTH COMPANY March 2004

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