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SECURITIES AND EXCHANGE COMMISSIONFORM 8-KCurrent report filingFiling Date: 2011-11-03 Period of Report: 2011-11-02SEC Accession No. 0001206774-11-002384(HTML Version on secdatabase.com)FILERJ2 GLOBAL COMMUNICATIONS INCCIK:1084048 IRS No.: 510371142 State of Incorp.:DE Fiscal Year End: 1231Type: 8-K Act: 34 File No.: 000-25965 Film No.: 111176255SIC: 4822 Telegraph & other message communicationsMailing Address6922 HOLLYWOOD BLVDLEGAL DEPT - 5TH FLOORLOS ANGELES CA 90028Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This DocumentBusiness Address6922 HOLLYWOOD BLVDLEGAL DEPT - 5TH FLOORLOS ANGELES CA 900283238609200
UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549FORM 8-KCURRENT REPORTPursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934Date of Report (Date of earliest event reported) November 2, 2011j2 Global Communications, Inc.(Exact name of registrant as specified in its charter)Delaware(State or other jurisdiction ofincorporation or organization)0-25965(CommissionFile Number)51-0371142(IRS EmployerIdentification No.)6922 Hollywood Blvd.Suite 500Los Angeles, California 90028(Address of principal executive offices)(323) 860-9200(Registrant's telephone number, including area code)(Former name or former address, if changed since last report)Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any ofthe following provisions (see General Instruction A.2. below):oWritten communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)oSoliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)oPre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))oPre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document
Item 2.02 and 7.01. Results of Operations and Financial Condition and Regulation FD Disclosure.On November 2, 2011, j2 Global Communications, Inc. issued a press release announcing its financial results for the third quarter of fiscal 2011.In the press release, j2 Global reaffirmed its fiscal 2011 financial estimates as follows: Non-GAAP revenues from 335 to 345 million andNon-GAAP EPS of 2.46 to 2.56, exclusive in each case, where applicable, of approximately 9 million of share-based compensation expense,approximately 4 million of transition-related costs and the impact of a Q1 2011 one-time, non-cash, change in estimate relating to deferredrevenues. In addition, the press release announced that j2 Global’s Board of Directors approved the declaration of a quarterly cash dividend toits shareholders of 0.205 per common share, a 2.5% increase versus last quarter’s dividend. The dividend will be paid on November 28, 2011to all shareholders of record as of the close of business on November 14, 2011. Future dividends will be subject to Board approval. A copy ofthe press release is furnished as Exhibit 99.1 to this Form 8-K.Also on November 2, 2011, at 5:00 p.m. Eastern time, j2 Global hosted its third quarter 2011 earnings conference call and Webcast. Viathe Webcast, j2 Global presented portions of its November 2, 2011 Investor Presentation, which contains a summary of j2 Global's financialresults for the fiscal quarter ended September 30, 2011, reaffirms financial guidance for the fiscal year ending December 31, 2011 and includesinformation relating to the above-referenced quarterly cash dividend and certain other financial and operating information regarding j2 Global.A copy of this presentation is furnished as Exhibit 99.2 to this Form 8-K.NOTE: This information is being furnished under both Item 2.02 (Results of Operations and Financial Condition) and Item 7.01 (RegulationFD Disclosure) of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended(the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except asshall be expressly set forth by specific reference in such a filing.Item 9.01. Financial Statements and Exhibits.(d) ExhibitsExhibitNumberDescription99.1Press Release dated November 2, 2011.99.2November 2, 2011 Investor Presentation.SIGNATURESPursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by theundersigned hereunto duly authorized.j2 Global Communications, Inc.(Registrant)Date: November 2, 2011By:/s/ Jeffrey D. AdelmanJeffrey D. AdelmanVice President, General Counsel and Secretary-2-Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document
INDEX TO EXHIBITSExhibitNumberDescription99.1Press Release dated November 2, 2011.99.2November 2, 2011 Investor Presentation.-3-Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document
j2 Global Reports Third Quarter 2011 ResultsAchieves Record Quarterly and Nine Month RevenuesIncreases Quarterly Dividend by 2.5% to 0.205 Per ShareLOS ANGELES —November 2, 2011—j2 Global Communications, Inc. [NASDAQGS:JCOM] today reported financial results for the thirdquarter ended September 30, 2011 and announced that its Board of Directors has declared an increase of its quarterly cash dividend to 0.205per share.The Company achieved record quarterly and nine-month GAAP revenues of 86.0 million and 245.1 million, respectively. The Companyalso achieved record quarterly and nine-month fixed subscriber revenues* of 70.4 million and 197.1 million, respectively. In addition, theCompany generated record nine-month free cash flow(3) of 117.4 million.THIRD QUARTER 2011 RESULTSGAAP revenues increased 37.0% to 86.0 million compared to 62.8 million in Q3 2010.Non-GAAP net earnings per diluted share(1) (2) increased 36.2% to 0.64 from 0.47 in Q3 2010. GAAP net earnings per diluted share increased25.6% to 0.54 for Q3 2011 from 0.43 for Q3 2010.Free cash flow(3) for Q3 2011 increased 39.6% to 37.2 million compared to 26.7 million in Q3 2010.The Company ended the quarter with 193.8 million in cash and investments.Key financial results for third quarter 2011 versus third quarter 2010 are as follows:Q3 2011GAAP RevenuesQ3 2010 86.0 million 62.8 million% Change37.0%Non-GAAP Net Earnings per Diluted Share(1)(2) 0.64 0.4736.2%GAAP Net Earnings per Diluted Share(1) 0.54 0.4325.6%Free Cash Flow (3) 37.2 million 26.7 million39.6%(1)The estimated Non-GAAP effective tax rate was approximately 23.4% for Q3 2011 and 28.8% for Q3 2010. The estimated GAAPeffective tax rate was approximately 30.6% for Q3 2011 and 28.5% for Q3 2010.(2)Non-GAAP earnings per diluted share excludes share-based compensation and related payroll taxes, certain transition-related costs,taxes associated with the sale of a tradename and the reversal of uncertain income tax positions due to expired statutes of limitations, ineach case net of tax.(3)Free cash flow is defined as net cash provided by operating activities, less purchases of property, plant and equipment, plus excess taxbenefit (deficiency) from share-based compensation.Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document
“I am particularly excited about three accomplishments this quarter,” said Hemi Zucker, j2 Global’s chief executive officer. “First, is thecontinued growth of our fixed subscriber revenue, which serves as a stable base upon which the rest of our business is built. Second, I amextremely proud of the efficiency with which the Company has integrated the recent acquisitions of Venali and Data Haven and migrated andupgraded the my1voice customers to eVoice . Our success with the Protus acquisition and migration enhances our confidence to pursuelarger acquisitions which is facilitated our cash and investment position of nearly 200 million. Third, we are continuing to see increasedsuccess with our cross selling programs, which we intend to expand in 2012.”BUSINESS OUTLOOKj2 Global is reaffirming its previously issued financial estimates for fiscal 2011. Non-GAAP revenues is expected to be between 335 and 345million and Non-GAAP net earnings per diluted share is expected to be between 2.46 and 2.56, exclusive in each case, where applicable,of approximately 9 million of share-based compensation expense, approximately 4 million of transition-related costs and the impact of a Q12011 one-time, non-cash, change in estimate relating to deferred revenues.It is anticipated that the normalized Non-GAAP effective tax rate for fiscal 2011 (exclusive of the release of certain FIN 48 reserves) will bebetween 25% and 27%.DIVIDENDThe Company’s Board of Directors has approved the declaration of a quarterly cash dividend to its shareholders of 0.205 per common share,a 2.5% increase versus last quarter’s dividend. The dividend will be paid on November 28, 2011 to all shareholders of record as of the close ofbusiness on November 14, 2011. Future dividends will be subject to Board approval.* Fixed subscriber revenues represent revenues derived from both recurring and activation subscriber fees.About j2 Global CommunicationsFounded in 1995, j2 Global Communications, Inc. (NASDAQ: JCOM) provides cloud based, value-added communication, messaging anddata backup services to individuals and businesses around the world. With offices in eight cities worldwide, j2 Global's network spans morethan 4,600 cities in 49 countries on six continents. The Company's websites appear in numerous languages, including Dutch, French, German,Spanish, English and more. Payments are accepted in currencies that include the U.S. Dollar, British Pound, Canadian Dollar, Japanese Yen,Euro, Hong Kong Dollar and more. j2 Global provides live sales and customer service support in multiple languages, including English,Spanish, Dutch, German, French, Cantonese and more. j2 Global markets its services principally under the brands eFax , eVoice , FuseMail ,Campaigner , KeepItSafe and Onebox . As of December 31, 2010, j2 Global had achieved 15 consecutive fiscal years of revenue growth. Formore information about j2 Global, please visit www.j2global.com.Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document
Contact:Jeff Adelmanj2 Global Communications, Inc.323-372-3617press@j2global.com“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995: Certain statements in this Press Release are“forward-looking statements” within the meaning of The Private Securities Litigation Reform Act of 1995, particularly those contained inthe “Business Outlook” and “Dividend” portions regarding the Company’s expected fiscal 2011 financial performance and regarding anyfuture dividend payments. These forward-looking statements are based on management’s current expectations or beliefs and are subject tonumerous assumptions, risks and uncertainties that could cause actual results to differ materially from those described in the forward-lookingstatements. These factors and uncertainties include, among other items: subscriber growth and retention; variability of revenue based onchanging conditions in particular industries and the economy generally; protection of the Company’s proprietary technology or infringementby the Company of intellectual property of others; the risk of adverse changes in the U.S. or international regulatory environments surroundingmessaging and communications, including but not limited to the imposition or increase of taxes or regulatory-related fees; sufficient cash flowsand liquidity to pay future dividends and the Board approving any such dividends; and the numerous other factors set forth in j2 Global’s filingswith the Securities and Exchange Commission (“SEC”). For a more detailed description of the risk factors and uncertainties affecting j2 Global,refer to the 2010 Annual Report on Form 10-K filed by j2 Global on February 28, 2011, and the other reports filed by j2 Global from time-totime with the SEC, each of which is available at www.sec.gov. The forward-looking statements provided in this press release and particularlythose contained in the “Business Outlook” and “Dividend” portions regarding the Company’s expected fiscal 2011 financial performance andregarding any future dividend payments are based on limited information available to the Company at this time, which is subject to change.Although management’s expectations may change after the date of this press release, the Company undertakes no obligation to revise or updatethese statements.Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document
j2 GLOBAL COMMUNICATIONS, INC.CONDENSED CONSOLIDATED BALANCE SHEETS(UNAUDITED, IN THOUSANDS)SEPTEMBER 30,2011ASSETSCash and cash equivalentsShort-term investmentsAccounts receivable,net of allowances of 3,527 and 2,588, respectivelyPrepaid expenses and other current assetsDeferred income taxes 134,19029,005DECEMBER 31,2010 l current assets200,223115,502Long-term investmentsProperty and equipment, netGoodwillOther purchased intangibles, netDeferred income taxesOther 67281,84899,95412,967610TOTAL ASSETSLIABILITIES AND STOCKHOLDERS' EQUITYAccounts payable and accrued expensesIncome taxes payableDeferred revenueLiability for uncertain tax positionsDeferred income taxes 636,905 532,623 22,9032,34327,275297680 25,1121,79816,93813,471573Total current liabilities53,49857,892Liability for uncertain tax positionsDeferred income taxesOther long-term liabilities27,89720,0423,07224,39115,2933,302Total liabilities104,509100,878Commitments and contingencies——Stockholders' Equity:Preferred stockCommon stockAdditional paid-in capitalTreasury stock—553194,649(112,671 )—537164,769(112,671Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document)
Retained earningsAccumulated other comprehensive loss452,489(2,624Total stockholders' equity532,396TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document636,905381,145(2,035)431,745 532,623)
j2 GLOBAL COMMUNICATIONS, INC.CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS(UNAUDITED, IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)THREE MONTHS ENDED SEPTEMBER 30,2011NINE MONTHS ENDED SEPTEMBER 30,201020112010RevenuesSubscriber 85,622Other405Total revenue86,027 62,066 712243,788 4,92932,32712,7148,810Cost of revenues (including share-based compensation of 246 and 736 for the three and nine months of 2011, respectively, and 304and 963 for the three and nine months of 2010, respectively)Gross profitOperating expenses:Sales and marketing (including share-based compensation of 350 and 1,049 for the three and nine months of 2011,respectively, and 464 and 1,460 for the three and nine monthsof 2010, respectively)Research, development and engineering (including share-basedcompensation of 110 and 367 for the three and nine months of2011, respectively, and 204 and 645 for the three and ninemonths of 2010, respectively)4,1053,008General and administrative (including share-based compensationof 1,542 and 4,532 for the three and nine months of 2011,respectively, and 1,805 and 5,699 for the three and ninemonths of 2010, respectively)15,40310,92144,03734,263Total operating expenses34,58124,807101,68075,400Operating earnings36,44427,23997,45577,591Interest and other income (expense), net2902621,750Earnings before income taxes36,73497,71779,34149127,73011,236Provision for income taxes7,89619,83412,77023,161Net earnings 25,498 84,947 56,180Basic net earnings per common share 0.55 0.44 1.84 1.26Diluted net earnings per common share 0.54 0.43 1.81 1.23Basic weighted average shares 1Diluted weighted average shares 9Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document
j2 GLOBAL COMMUNICATIONS, INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(UNAUDITED, IN THOUSANDS)NINE MONTHS ENDED SEPTEMBER 30,20112010Cash flows from operating activities:Net earningsAdjustments to reconcile net earnings to net cashprovided by operating activities:Depreciation and amortizationAmortization of discount or premium of investmentsShare-based compensationExcess tax benefit from share-based compensationProvision for doubtful accountsDeferred income taxesDecrease (increase) in:Accounts receivablePrepaid expenses and other current assetsOther assets(Decrease) increase in:Accounts payable and accrued expensesIncome taxes payableDeferred revenueLiability for uncertain tax positionsOther 84,94714,8926006,672(13,2464,9635,394 426(4226,339677))))))Net cash provided by operating activities109,23374,152Cash flows from investing activities:Maturity of certificates of depositPurchase of certificate of depositSales of available-for-sale investmentsPurchases of available-for-sale investmentsPurchases of property and equipmentPurchases of intangible assetsAcquisition of businesses, net of cash receivedProceeds from sale of 653—9,019(52,921(1,273(6,953(36,546—Net cash used in investing activities(48,996)(57,021)Cash flows from financing activities:Repurchases of common stock and restricted stockIssuance of common stock under employee stock purchase planExercise of stock optionsExcess tax benefit from share-based compensationDividends )Net cash provided by (used in) financing activities9,621(1,577)Effect of exchange rate changes on cash and cash equivalents(420(265)Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document)))))))))))
Net increase in cash and cash equivalentsCash and cash equivalents at beginning of periodCash and cash equivalents at end of period69,43864,752 134,190Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document15,289197,411 212,700
j2 GLOBAL COMMUNICATIONS, INC.UNAUDITED RECONCILIATION OF MODIFIED NET EARNINGSTHREE MONTHS ENDED SEPTEMBER 30, 2011 AND 2010(UNAUDITED, IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)Modified net earnings are GAAP net earnings with the following modifications: (1) elimination of share-based compensation expense; (2)elimination of payroll taxes associated with share-based compensation; (3) elimination of certain acquisition and related exit costs and (4)elimination of income tax expense or benefit associated with share-based compensation, the associated payroll taxes, certain acquisition andrelated exit costs, a change to our liability of uncertain tax position due to expiration of statues of limitations and taxes related to trade namesale.Modified net earnings and modified net earnings per share are not meant as a substitute for measures determined under GAAP, but are solelyfor informational purposes. The following table illustrates and reconciles the GAAP net earnings with the aforementioned exclusions. TheCompany believes that this non-GAAP financial information are
Item 2.02 and 7.01. Results of Operations and Financial Condition and Regulation FD Disclosure. On November 2, 2011, j2 Global Communications, Inc. issued a press release announcing it
