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West Corporation Reports First Quarter 2013 Results And Declares Quarterly Dividend

These forward-looking statements speak only as of the date on which the statements were made. West undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, except to the extent required by applicable law.

 WEST CORPORATION 
 CONDENSED STATEMENTS OF OPERATIONS 
 (Unaudited, in thousands except selected operating data) 
             
   Three Months Ended March 31,   
   2013   2012     2013     2013 Adj. 
   Actual   Actual  % Change  Adjusted (1)  % Change  Pro Forma (3) 
Revenue  $ 660,224  $ 639,062 3.3%  $ 660,224 3.3%  $ 660,224
Cost of services  309,067  291,702 6.0%  309,067 6.0%  309,067
Selling, general and administrative expenses  257,867  233,118 10.6%  212,741 -8.7%  212,741
Operating income  93,290  114,242 -18.3%  138,416 21.2%  138,416
Interest expense, net  72,879  62,062 17.4%  68,225 9.9%  46,430
Subordinated debt call premium  16,502  --   --   --   --   -- 
Other expense (income), net  (979)  (2,730) NM  (979) NM  (979)
Income before tax  4,888  54,910 -91.1%  71,170 29.6%  92,965
Income tax  1,833  20,866 -91.2%  26,689 27.9%  34,862
Net income  $ 3,055  $ 34,044 -91.0%  $ 44,481 30.7%  $ 58,103
             
Weighted average shares outstanding:            
 Basic  63,918  61,368    63,918    83,449
 Diluted  65,366  63,529    65,366    84,897
             
Earnings per share:            
 Basic  $ 0.05  $ 0.55 -90.9%  $ 0.70 27.3%  $ 0.70
 Diluted  $ 0.05  $ 0.54 -90.7%  $ 0.68 25.9%  $ 0.68
             
SELECTED SEGMENT DATA:            
Revenue:            
 Unified Communications   $ 367,568  $ 359,647 2.2%      
 Communication Services   296,451  281,737 5.2%      
 Intersegment eliminations  (3,795)  (2,322) NM      
 Total  $ 660,224  $ 639,062 3.3%      
             
Depreciation:             
 Unified Communications   $ 15,448  $ 15,097 2.3%      
 Communication Services   12,359  11,211 10.2%      
 Total  $ 27,807  $ 26,308 5.7%      
             
Amortization:            
 Unified Communications - SG&A  $ 6,224  $ 7,249 -14.1%      
 Communication Services - COS  2,589  2,129 21.6%      
 Communication Services - SG&A  7,737  7,629 1.4%      
 Corporate - deferred financing costs  4,654  3,393 37.2%      
 Total  $ 21,204  $ 20,400 3.9%      
             
Share-based Compensation            
 Unified Communications   $ 1,479  $ 17 NM      
 Communication Services   1,711  116 NM      
 Total  $ 3,190  $ 133 NM      
             
Cost of services:            
 Unified Communications   $ 157,106  $ 148,740 5.6%      
 Communication Services   155,391  144,742 7.4%      
 Intersegment eliminations  (3,430)  (1,780) NM      
 Total  $ 309,067  $ 291,702 6.0%      
             
Selling, general and administrative expenses:            
 Unified Communications   $ 132,598  $ 113,770 16.5%      
 Communication Services   125,635  119,889 4.8%      
 Intersegment eliminations  (366)  (541) NM      
 Total  $ 257,867  $ 233,118 10.6%      
             
Operating income:            
 Unified Communications   $ 77,865  $ 97,136 -19.8%  $ 103,278 6.3%  
 Communication Services   15,425  17,106 -9.8%  35,138 105.4%  
 Total  $ 93,290  $ 114,242 -18.3%  $ 138,416 21.2%  
             
Operating margin:            
 Unified Communications  21.2% 27.0%   28.1%    
 Communication Services  5.2% 6.1%   11.9%    
 Total 14.1% 17.9%   21.0%    
             
SELECTED OPERATING DATA:            
Revenue from platform-based services (5)  $ 481,438  $ 448,752 7.3%      
Revenue from agent-based services   $ 181,372  $ 192,817 -5.9%      

NM: Not Meaningful

 CONDENSED BALANCE SHEETS 
 (Unaudited, in thousands) 
       
   Mar. 31,   Dec. 31,  %
   2013   2012  Change
Current assets:      
 Cash and cash equivalents  $ 651,136  $ 179,111 263.5%
 Trust and restricted cash  14,886  14,518 2.5%
 Accounts receivable, net  442,608  444,411 -0.4%
 Deferred income taxes receivable  21,691  13,148 65.0%
 Prepaid assets  53,632  42,129 27.3%
 Other current assets  71,398  67,775 5.3%
 Total current assets  1,255,351  761,092 64.9%
Net property and equipment  356,667  364,896 -2.3%
Goodwill  1,812,253  1,816,851 -0.3%
Other assets  516,661  505,314 2.2%
 Total assets  $3,940,932  $3,448,153 14.3%
       
Current liabilities  $ 957,506  $ 457,668 109.2%
Long-term obligations  3,587,435  3,992,531 -10.1%
Other liabilities   246,149  247,640 -0.6%
 Total liabilities  4,791,090  4,697,839 2.0%
       
Stockholders' deficit  (850,158)  (1,249,686) 32.0%
 Total liabilities and stockholders' deficit  $3,940,932  $3,448,153 14.3%
       

NM: Not Meaningful

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