West Corporation Reports Record Fourth Quarter & Full Year 2004 Earnings

OMAHA, NE – West Corporation (Nasdaq: WSTC), a leading provider of outsourced communication solutions, yesterday announced record fourth quarter and full-year 2004 results.

“We achieved significant revenue growth in all of our business segments, both during the fourth quarter and over the past year,” said Thomas B. Barker, Chief Executive Officer of West Corporation. “The acquisitions of Worldwide (Asset Management) and ECI, combined with the strengths in our existing businesses, have positioned us well for 2005.”

Consolidated Operating Results
For the fourth quarter ended December 31, 2004, revenues were $336.7 million compared to $271.0 million for the same quarter last year, an increase of 24.2%. Revenue from acquired entities accounted for $36.4 million of this increase. Operating income for the fourth quarter was $52.5 million, an increase of 40.7% compared to $37.3 million for the fourth quarter of 2003. Net income was $30.5 million, up 35.2% compared to $22.6 million in the same quarter last year. Diluted earnings per share were $0.43 versus $0.33 in the same period of 2003.

For the fiscal year 2004, revenues were $1,217.4 million, a 23.2% increase compared to 2003 revenues of $988.3 million. Revenue from acquired entities accounted for $165.3 million of this increase. Operating income was $187.9 million, up 31.3% compared to $143.1 million in the prior year. Net income increased 28.8% to $113.2 million, versus $87.9 million in 2003. The company earned $1.63 per diluted share in 2004, compared to $1.28 in 2003.

Margins
The company reported consolidated operating income as a percentage of revenue of 15.6% in the fourth quarter of 2004, up from 13.8% in the comparable quarter last year. For the twelve months ended December 31, 2004, operating income as a percentage of revenues was 15.4%, compared to 14.5% in fiscal 2003. The operating margin improvements for the year reflect management’s control of SG&A expense and the impact of the acquisition of Worldwide Asset Management on August 1, 2004.

Balance Sheet
At December 31, 2004, West Corporation had cash and short-term investments totaling $32.6 million and a current ratio of 1.8 to 1. Net cash flows from operating activities were $222.5 million for the year, an increase of $26.3 million over 2003.

“During the fourth quarter, we invested $21.6 million in capital expenditures to open a new contact center in Ohio, as well as expand six domestic and three international centers to support new business opportunities. We also redeployed one Outbound contact center to the Receivables Management segment and converted two additional Outbound centers for Inbound dedicated agent business,” commented Paul Mendlik, Chief Financial Officer of West. “During 2004, we added 2,500 workstations, including 1,300 international workstations, and our ‘West at Home’ program has continued to expand, now utilizing over 5,500 agents.”

West amended its existing revolving credit facility in the fourth quarter of 2004. The amended facility increases the borrowing capacity to $400 million, provides greater financial flexibility, reduces the Company’s interest rate, and relaxes certain debt covenants. West utilized $230 million of this credit facility at December 31, 2004 and had an effective interest rate of 3.3% in the fourth quarter. This facility was used to fund the ECI acquisition.

About West Corporation
West Corporation is a leading provider of outsourced communication solutions to many of the world’s largest companies. The company helps its clients communicate effectively, maximize the value of their customer relationships and drive greater revenue from each transaction. West’s integrated suite of customized solutions includes customer acquisition, customer care and retention services, interactive voice response services, and conferencing and accounts receivable management services.

Founded in 1986 and headquartered in Omaha, Nebraska, West has a team of approximately 28,000 employees based in North America, Europe and Asia.

For more information, please visit www.west.com.