Talk America Holdings Inc.
12020 Sunrise Valley Dr., Suite 250
Reston, Va. 20191
www.talk.com Year founded: 1989 Industry: Telecommunications Revenue: $382.66 Million Net Income/Loss: $78.46 Million Earnings per share: $2.75 Dividend: n/a Stockholder equity: $99.79 Million Auditor: PricewaterhouseCoopers LLP Stock: TALK Assets: $245.92 Million Market capitalization: $256.34 Million 52-week high: 16.04 9/8/2003 52-week low: 7.35 5/16/2003 Executive chairman: Gabriel A. Battista President and CEO: Edward B. Meyercord III Employees: 1300 Local employees: 28 Description: Talk America provides local and long-distance telephone service, competing with AT&T, MCI and others. It uses a long-distance telecommunications network of its own and leases access to local telephone lines. It operates primarily in Michigan, Illinois, Wisconsin, Indiana, Ohio, New York, New Jersey, Georgia, Texas, Pennsylvania and Maryland. Developments: Talk America began 2003 on a high note when the Federal Communications Commission voted that regional phone carriers must offer competitors such as Talk America leased access to their lines at discounted rates. The FCC decision boosted Talk America's stock price. But Talk America's stock took a hit in March 2004 when a federal appeals court struck down key portions of the FCC's order. The court ruling could increase Talk America's costs, but the company said it could continue to provide all the same services. The company was watching to see if the government appeals the ruling. Since the beginning of 2003, Talk America has initiated service in Illinois, Wisconsin, New Jersey and Maryland, and it is preparing to enter Virginia. In Michigan, its biggest market, it has been testing a 50,000-line switch for its own calls, to take more business from the regional phone company. In 2003, the company cut debt to $48.5 million from $100.8 million, unburdening itself of interest payments at rates of 8 and 12 percent. The company still has about 250,000 customers for its long-distance service, but it has been allowing that number to shrink as it focuses its marketing on combined local and long-distance service. FCC rules governing the national do-not-call database took effect in October, limiting telemarketing. The company has been diversifying into direct mail and other forms of marketing. The company put in place a succession plan under which then-chairman and chief executive Gabriel A. Battista became executive chairman and president Edward B. Meyercord III became chief executive, in line to take the reins from Battista.
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