Vonage 2010 Annual Report Download - page 2

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10090807
$0
$(93)
$(34)
$3
$47
NET INCOME (LOSS)*
excluding certain charges
(dollars in millions)
10090807
$0
$828
$900 $889 $885
REVENUE
(dollars in millions)
10090807
0%
2.8%
3.1% 3.1%
2.4%
AVERAGE MONTHLY
CUSTOMER CHURN
10090807
$0
$(46)
$54
$119
$156
ADJUSTED EBITDA*
excluding certain charges
(dollars in millions)
2010 was a year of
accomplishment. The dramatic
improvement in our
performance is a direct result
of the focused efforts of
our dedicated teams around
the world.
Vonage is a much stronger company today than it was several years ago. We’ve increased
EBITDA by more than $200 million since 2007, stabilized our customer base as we achieved
our best churn performance in five years, and we exited the year with a fresh balance sheet.
During 2010, we generated record-high financial results, as we strategically focused on the
attractive international calling segment of the market. And we launched innovative services
that start to deliver on our expansive vision to provide compelling communication services that
connect individuals and social networks worldwide, through broadband devices.
We emerged from the comprehensive refinancing we completed in December with a strong
capital structure, low leverage, and ample liquidity. We are also no longer encumbered by the
high interest rates and restrictive covenants of the restructuring debt put in place in 2008
at the height of the credit crisis.
As we have transformed virtually every aspect of our business, the financial markets have
recognized our substantial progress. Vonage stock rose 60% during the year, outpacing all
major market indices.
*Adjusted EBITDA and net income (loss) excluding certain charges are non-GAAP financial measures. Adjusted EBITDA is defined
as income (loss) from operations before depreciation, amortization and share-based expense. Net income (loss) excluding
certain charges is defined as GAAP net loss excluding the change in fair value of embedded features within notes payable and
stock warrant and the gain (loss) on extinguishment of notes. Please refer to the company’s Web site at http://ir.vonage.com for
a reconciliation to GAAP.
Dear Shareholders: