SAN JOSE, Ca. — December 6, 2007 — SAVVIS, Inc. (NASDAQ: SVVS), a global leader in IT infrastructure services for business applications, will hold its 2007 Investor Forum today in San Jose, Ca. Senior executives will outline the company’s growth strategy, confirm its 2007 and 2008 revenue outlook, and refine adjusted EBITDA and capital expenditure outlook to reflect global data center expansions (announced separately today). The Investor Forum will be webcast live via the Investor Relations page at www.savvis.net, and a replay will be available on the website following the event.
Presenting executives will discuss the trends driving demand for IT infrastructure outsourcing and SAVVIS’ commitment to providing enterprises with innovative, secure, integrated solutions that deliver IT infrastructure as a service. Presenters will include Chief Executive Officer Phil Koen, President Jonathan Crane, Chief Financial Officer Jeff Von Deylen, Chief Technology Officer Bryan Doerr, and other members of the senior executive team. SAVVIS Chief Executive Officer Phil Koen said, “SAVVIS’ strategy is focused squarely on long-term, profitable revenue growth with an eye toward global expansion. In 2007, we made significant improvements in our capital structure, our service delivery infrastructure, and our global hosting footprint that are enhancing our growth as a global IT infrastructure services leader.”
In conjunction with the Investor Forum and today’s announcement of data center expansions, SAVVIS is refining its guidance for Adjusted EBITDA* for the fourth quarter 2007. The outlook for revenue is unchanged from that issued on October 23, 2007. SAVVIS’ outlook for fourth quarter 2007 now includes:
•Total revenue in a range of $197-200 million for sequential-quarter growth of 4-5%, including
•total hosting revenue of $121-124 million, for sequential-quarter growth of 6-9%, including $58-60 million from managed hosting services, for sequential-quarter growth of 5-9%; and SAVVIS Holds 2007 Investor Forum
•Adjusted EBITDA* in a range of $38-40 million, reflecting approximately $1 million of operating costs incurred in development of three data centers as announced separately today, for sequential-quarter growth of 7-13% and an Adjusted EBITDA margin of approximately 20%; and
•Capital expenditures of $120-125 million, of which approximately $95-100 million will be in cash and approximately $25 million will be financed through an existing credit facility.
•For the full year 2007, total capital expenditures are expected to be approximately $375 million, of which approximately $30 million will be financed through an existing credit facility.
•Total capital expenditures for 2007 will include approximately $225 million of cash capital expenditures related to development of seven data centers and approximately $35 million of largely financed capital expenditures for network upgrades, with approximately 60-70% of the remainder reflecting ongoing customer-growth-based investments.
•Ending cash balance for 2007 will be approximately $175-180 million.
The company also updated its outlook for 2008 Adjusted EBITDA and capital expenditures to reflect data-center expansion plans in London, the New York area and Singapore (announced separately today). The outlook for 2008 now includes:
•Total revenue in a range of $910-925 million, for growth of 15-16% on a reported basis, including.
•approximately $590-610 million of revenue from hosting services, including approximately $310-320 million of colocation revenue and approximately $280-290 million of managed hosting revenue, and
•approximately $315 million of revenue from network services; and
•Adjusted EBITDA in a range of $200-210 million, reflecting approximately $10 million of negative Adjusted EBITDA impact from costs associated with data-center expansions in London and Singapore.
•Capital expenditures of $290-310 million, including approximately $145-150 million for development of data centers in Boston, Chicago, Dallas, London and Singapore.
Chief Financial Officer Jeff Von Deylen said, “We are looking forward to strong growth in the fourth quarter that will position SAVVIS for continued growth throughout 2008. Our model, which focuses on providing high-quality data center services and managed hosting solutions for enterprises that want to achieve increased IT reliability and security at lower total cost, is generating powerful demand. These demand characteristics have created the opportunity for us to continue to expand our footprint globally.”
Following the live broadcast of the 2007 Investor Forum, the complete presentation will be available on the company’s Investor Relations website, including reconciliations to the most directly related comparable GAAP measures of the non-GAAP financial measures included in this press release and in the presentation.
SAVVIS, Inc. (NASDAQ: SVVS) is a global leader in IT infrastructure services for business applications. With an IT services platform spanning North America, Europe, and Asia, SAVVIS is an industry leader in delivering secure, reliable, and scalable hosting, network, and application services. These solutions enable customers to focus on their core business while SAVVIS ensures the quality of their IT systems and operations. SAVVIS’ strategic approach combines virtualization technology, a global network and multiple data centers, and automated management and provisioning systems. For more information about SAVVIS, visit www.savvis.net.
* Adjusted EBITDA
“Adjusted EBITDA” represents income (loss) from operations before depreciation, amortization, accretion, gains and losses on sales of assets, and non-cash equity-based compensation. We have included information concerning Adjusted EBITDA because we believe that in our industry such information is a relevant measurement of a company's operating financial performance and liquidity. The calculation of Adjusted EBITDA is not specified by United States generally accepted accounting principles. Our calculation of Adjusted EBITDA may not be comparable to similarly titled measures of other companies.
This document contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results, including financial performance and product growth, may differ materially from SAVVIS’ expectations. Certain factors that could adversely affect actual results are set forth as risk factors described in SAVVIS’ SEC reports and filings, including its annual report on Form 10-K for the year ended December 31, 2006, and all subsequent filings. Those risk factors include, but are not limited to, variability in pricing for SAVVIS’ products, highly competitive markets, rapid evolution of technology, variability in the availability and terms of financing, uncertainties related to merger and acquisition activity, changes in our operating environment, and changes in regulatory environments. The forward-looking statements contained in this document speak only as of the date of publication, December 6, 2007. Subsequent events and developments may cause the company’s forward-looking statements to change, and the company will not undertake efforts to revise those forward-looking statements to reflect events after this date.