CSG Systems International, Inc. (CSGS)
Q1 2010 Earnings Call Transcript
April 27, 2010 5:00 pm ET
Liz Bauer – VP, IR
Peter Kalan – President and CEO
Randy Wiese – EVP and CFO
Ashwin Shirvaikar – Citi
Chris Koh – Thomas Weisel Partners
Scott Sutherland – Wedbush Securities
Sterling Auty – JP Morgan
VJ Corey [ph] – Raymond James
Shateel Alam – Kaufman Brothers
Shaul Eyal – Oppenheimer & Company
Previous Statements by CSGS
» CSG Systems International Inc. Q4 2009 Earnings Call Transcript
» CSG Systems International Q3 2009 Earnings Call Transcript
» CSG Systems International Inc. Q4 2008 Earnings Call Transcript
Good afternoon, ladies and gentlemen. Thank you for standing by. Welcome to the CSG Systems first quarter conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference will be open for questions. (Operator Instructions) This conference is being recorded today, Tuesday April 27, 2010.
I would now like to turn the conference over to Liz Bauer, Vice President of Investor Relations. Please go ahead.
Thank you, Douglas and thanks to everyone on the call for joining us. Today's discussion will contain a number of forward-looking statements. In particular, these will include statements regarding our projected financial results, our ability to meet our client's needs through our products, services and performance and our ability to successfully integrate and manage acquired businesses in order to achieve their expected strategic operating and financial goals.
While these statements our best current judgment, they are subject to risks and uncertainties that could cause our actual results to differ materially. Please note that these forward-looking statements reflect our opinions only as of the date of this call and we undertake no obligation to revise or publicly release any revisions to these forward-looking statements in light of new information or future events.
In addition to factors noted during this call, a comprehensive discussion of our risk factors can be found in today's press release, as well as in our most recently filed 10-K and 10-Q, which are available in the Investor Relations section of our website. Also, we will discuss certain financial information that is not prepared in accordance with GAAP. We use this non-GAAP information in our internal analysis in order to exclude significant items that may have a disproportionate effect in a particular period.
Accordingly, we believe isolating the effects of such an event enables us, as well as investors to consistently analyze the critical components of our operating results and to have meaningful comparisons to prior periods. For more information regarding our use of non-GAAP financial measures, we refer you to today's earnings release and non-GAAP reconciliation tables on our website, which will also be furnished to the SEC on Form 8-K.
With me today on the phone are Peter Kalan, our Chief Executive Officer and Randy Wiese, our Chief Financial Officer. I would now like to turn the call over to Peter.
Thank you, Liz, and thanks to everyone for joining us on the call today. I'm pleased to report that CSG continues to execute well, posting first quarter revenues of $130 million and non-GAAP EPS of $0.49 per share.
Our revenues 5% from the first quarter of 2009 and 2% from the fourth quarter. Our revenue growth for the quarter includes the market share wins that we had last year, which resulted in adding 3 million new cable and multi-play customers on to our next-generation customer care and billing solutions.
We believe that our value proposition, providing highly scalable integrated outsource solutions that maximize and monetize every customer interaction will help fuel our growth in the future as we continue to help our clients execute on their business objectives. And now, more than ever, our clients' businesses are becoming more complex. Operators today are continually investing in and expanding their network capability so that they can provide their customers with more choice in how they access their services.
We continue to see more devices introduced that give the consumer the freedom to obtain their content anywhere at any time. Our clients are focused on providing an even more engaging and rewarding experience so that they are the source that consumers turn to for their communications and content needs.
Consumer spending on communication services are projected to increase to $200 per month in 2015 from the current spend of $130 a month according to STRATACACHE [ph] and not surprising to us, video spending represents one-third of consumer spend. We, along with a host of others, believe enabling customers to have access to content and information on a multitude of devices will be a key contributor to that growth.
Cisco expects that 9% of all Internet traffic will be video content by 2013. Research from Retrevo reinforces how viewing habits and some demographics are already beginning to change. Today, Retrevo estimates that 23% of people under the age of 25 watch most of their TV online versus 8% of adults over the age of 25.
And as consumers have increasing choices from which they can obtain their content, providing a superior customer experience will be the differentiator between those companies that thrive and those that struggle.
Let me give you an update as to how we are helping our clients execute on these factors, which not only contribute to their success, but CSG's as well. As you may recall, at the end of last year, we announced contracts with Time Warner and Comcast to roll out their WiMAX product to their consumers. During the first quarter, we began implementing our WiMAX offering with Time Warner in several other markets.
While the revenues coming from our clients' WiMAX offerings will be nominal at first due to the fact that it's a brand new service, as consumer adoption increases, we will benefit. And the key to increasing adoption will be enhancing the user experience through ease-of-use, convenience, flexibility, and expanding the types of content available to the customer.