exv99w1

Exhibit 99.1

Contact
Black Box Corporation
Gary Doyle
Director — Investor Relations
Phone: (724) 873-6788
Email: investors@blackbox.com

FOR IMMEDIATE RELEASE

BLACK BOX CORPORATION REPORTS FOURTH QUARTER AND FISCAL 2011 RESULTS
- Reports record annual revenues of $1.1 billion -


		Fiscal 2011 Highlights

		Record revenues of $1.1 billion.

		Revenue increases 11%, with 9% organic revenue growth.

		Free cash flow of $61 million.

		Diluted earnings per share increases 51% from $1.97 to $2.97.

		Adjusted EBITDA increases 28% from $93 million to $119 million.

PITTSBURGH, PENNSYLVANIA, May 12, 2011 — Black Box Corporation (NASDAQ:BBOX) today reported results for the fourth quarter of Fiscal 2011 and the fiscal year ended March 31, 2011.

Fourth quarter of Fiscal 2011 diluted earnings per share were 68¢ on net income of $12.3 million or 4.8% of revenues compared to diluted earnings per share of 43¢ on net income of $7.5 million or 3.1% of revenues for the same quarter last year. On a sequential quarter comparison basis, third quarter of Fiscal 2011 diluted earnings per share were 78¢ on net income of $13.9 million or 5.0% of revenues. Excluding reconciling items (which are identified below), operating earnings per share (which is a non-GAAP term and is defined below) for the fourth quarter of Fiscal 2011 were 75¢ on operating net income (which is a non-GAAP term and is defined below) of $13.5 million or 5.3% of revenues compared to operating earnings per share of 78¢ on operating net income of $13.8 million or 5.7% of revenues for the same quarter last year.

Fourth quarter of Fiscal 2011 pre-tax reconciling items were $2.0 million with an after-tax impact on net income and EPS of $1.3 million and 7¢, respectively. During the fourth quarter of Fiscal 2010, the Company’s pre-tax reconciling items were $9.6 million with an after-tax impact on net income and EPS of $6.3 million and 35¢, respectively. See below for further discussion regarding Management’s use of non-GAAP accounting measurements and a detailed presentation of the Company’s pre-tax reconciling items for the periods presented above.

Fourth quarter of Fiscal 2011 total revenues were $255 million, an increase of 6% from $241 million for the same quarter last year. On a sequential quarter comparison basis, third quarter of Fiscal 2011 total revenues were $277 million.

Fourth quarter of Fiscal 2011 cash provided by operating activities was $19 million or 153% of net income, compared to $20 million or 264% of net income for the same quarter last year. Fourth quarter of Fiscal 2011 free cash flow (which is a non-GAAP term and is defined below) was $22 million compared to $18 million for the same quarter last year. On a sequential quarter comparison basis, third quarter of Fiscal 2011 cash provided by operating activities was $28 million or 201% of net income and free cash flow was $31 million. Black Box utilized its fourth quarter of Fiscal 2011 free cash flow primarily to fund debt reduction of $17 million and to pay dividends of $1 million. Management believes that free cash flow, defined by the Company as cash provided by operating activities less net capital expenditures, plus proceeds from stock option exercises, plus or minus foreign currency translation adjustments, is an important measurement of liquidity as it represents the total cash available to the Company.

Fiscal 2011 diluted earnings per share were $2.97 on net income of $52.9 million or 4.9% of revenues compared to diluted earnings per share of $1.97 on net income of $34.5 million or 3.6% of revenues for the same period last year. Excluding reconciling items, operating earnings per share for Fiscal 2011 were $3.29 on operating net income of $58.5 million or 5.5% of revenues compared to operating earnings per share of $2.99 on operating net income of $52.4 million or 5.5% of revenues for the same period last year.

Fiscal 2011 pre-tax reconciling items were $9.1 million with an after-tax impact on net income and EPS of $5.7 million and 32¢, respectively. Fiscal 2010 pre-tax reconciling items were $28.2 million with an after-tax impact on net income and EPS of $17.9 million and $1.02, respectively.

Fiscal 2011 total revenues were $1,068 million, an increase of 11% from $961 million for the same period last year.

Fiscal 2011 cash provided by operating activities was $55 million or 104% of net income compared to $62 million or 180% of net income for the same period last year. Free cash flow was $61 million compared to $59 million for the same period last year. Black Box utilized its Fiscal 2011 free cash flow primarily to fund debt reduction of $30 million, to fund acquisition activity of $15 million and to pay dividends of $4 million.

The Company’s six-month order backlog was $223 million at March 31, 2011 compared to $203 million for the same quarter last year. On a sequential quarter-end comparison basis, the Company’s six-month order backlog was $212 million at January 1, 2011.

For Fiscal 2012, the Company is targeting reported revenues of approximately $1.125 billion to $1.145 billion and corresponding operating earnings per share in the range of $3.50 to $3.70. Included in these projections is an effective tax rate of 38.0%. For the first quarter of Fiscal 2012, the Company is targeting reported revenues of approximately $260 million to $265 million and corresponding operating earnings per share in the range of 80¢ to 85¢. These targets exclude acquisition-related expense and the impact of changes in the fair market value of the Company’s interest-rate swaps, and are before any new mergers and acquisition activity that has not been announced.

Commenting on the fourth quarter of Fiscal 2011 results and the first quarter of Fiscal 2012 outlook, Terry Blakemore, President and Chief Executive Officer said, “I am proud to announce our record revenue for Fiscal 2011. Our results for the year demonstrate the power of our diversified solution offering and client base. As different sectors of the global economy improved, Black Box was able to capture the benefit of that improvement and grow revenues organically by nine percent. Through disciplined management, our teams provided world-class solutions to our global clients and expanded our adjusted operating income margins for the year.”

“In Fiscal 2012, we look forward to strengthening our position as a communication system integrator by investing in our business and making select, strategic acquisitions. We remain committed to grow profitably and deliver value to our clients and shareholders.”

The Company will conduct a conference call beginning at 5:00 p.m. Eastern Daylight Time today, May 12, 2011. Terry Blakemore, President and Chief Executive Officer, will host the call. To participate in the call, please dial 612-332-1025 approximately 15 minutes prior to the starting time and ask to be connected to the Black Box Earnings Call. A replay of the conference call will be available for one week after the teleconference by dialing 320-365-3844 and using access code 202361. A live, listen-only audio webcast of the call will be available through a link on the Investor Relations page of the Company’s Web site at http://www.blackbox.com. A webcast replay of the call will also be archived on Black Box’s Web site for a limited period of time following the conference call.

Black Box is a leading technical services company dedicated to designing, building and maintaining today’s complicated data and voice infrastructure systems. Black Box services more than 175,000 clients in 141 countries with 196 offices throughout the world. To learn more, visit the Black Box Web site at http://www.blackbox.com.

Black Box^®,the Double Diamond logo and DVH^® are registered trademarks of BB Technologies, Inc.

Any forward-looking statements contained in this release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and speak only as of the date of this release. You can identify these forward-looking statements by the fact they use words such as “should,” “anticipate,” “estimate,” “approximate,” “expect,” “target,” “may,” “will,” “project,” “intend,” “plan,” “believe” and other words of similar meaning and expression in connection with any discussion of future operating or financial performance. One can also identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. Forward-looking statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those projected. Although it is not possible to predict or identify all risk factors, they may include levels of business activity and operating expenses, expenses relating to corporate compliance requirements, cash flows, global economic and business conditions, successful integration of acquisitions, the timing and costs of restructuring programs, successful marketing of DVH (Data, Voice, Hotline) services, successful implementation of the Company’s M&A program, including

identifying appropriate targets, consummating transactions and successfully integrating the businesses, successful implementation of our government contracting programs, competition, changes in foreign, political and economic conditions, fluctuating foreign currencies compared to the U.S. dollar, rapid changes in technologies, client preferences, the Company’s arrangements with suppliers of voice equipment and technology and various other matters, many of which are beyond the Company’s control. Additional risk factors are included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2010. We can give no assurance that any goal, plan or target set forth in forward-looking statements can be achieved and readers are cautioned not to place undue reliance on such statements, which speak only as of the date made. We undertake no obligation to release publicly any revisions to forward-looking statements as a result of future events or developments.

BLACK BOX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME


	Three-months ended				Fiscal Year ended
	March 31				March 31
In thousands, except per share amounts	2011		2010		2011		2010

Revenues
Hotline products	$	46,989	$	45,491	$	188,998	$	180,296
On-Site services		208,041		195,392		879,231		781,097

Total		255,030		240,883		1,068,229		961,393
Cost of sales
Hotline products		24,910		23,369		101,733		93,636
On-Site services		143,396		133,649		609,386		532,376

Total		168,306		157,018		711,119		626,012
Gross profit		86,724		83,865		357,110		335,381
Selling, general & administrative expenses		62,446		64,540		253,896		257,136
Intangibles amortization		3,095		5,899		12,156		15,202

Operating income		21,183		13,426		91,058		63,043
Interest expense (income), net		970		2,290		5,430		8,882
Other expenses (income), net		424		21		348		(166	)

Income before provision for income taxes		19,789		11,115		85,280		54,327
Provision for income taxes		7,531		3,619		32,418		19,824

Net income	$	12,258	$	7,496	$	52,862	$	34,503

Earnings per common share
Basic	$	0.69	$	0.43	$	2.99	$	1.97

Diluted	$	0.68	$	0.43	$	2.97	$	1.97

Weighted average common shares outstanding
Basic		17,855		17,548		17,680		17,546

Diluted		18,124		17,583		17,795		17,546

Dividends per share	$	0.06	$	0.06	$	0.24	$	0.24

BLACK BOX CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS


In thousands, except par value	March 31, 2011			March 31, 2010

Assets
Cash and cash equivalents	$	31,212		$	20,885
Accounts receivable, net		156,682			141,211
Inventories, net		52,014			51,507
Costs/estimated earnings in excess of billings on uncompleted contracts		103,853			86,086
Other assets		27,483			28,090

Total current assets		371,244			327,779
Property, plant and equipment, net		23,427			23,568
Goodwill		650,024			641,965
Intangibles
Customer relationships, net		91,066			93,619
Other intangibles, net		29,067			30,374
Other assets		7,155			8,059

Total assets	$	1,171,983		$	1,125,364

Liabilities
Accounts payable	$	71,463		$	66,934
Accrued compensation and benefits		35,329			33,260
Deferred revenue		36,043			34,876
Billings in excess of costs/estimated earnings on uncompleted contracts		17,462			14,839
Income taxes		11,957			9,487
Other liabilities		34,395			41,798

Total current liabilities		206,649			201,194
Long-term debt		181,127			210,873
Other liabilities		17,948			23,303

Total liabilities	$	405,724		$	435,370
Stockholders’ equity
Common stock	$	26		$	25
Additional paid-in capital		470,367			451,778
Retained earnings		599,923			551,315
Accumulated other comprehensive income		19,523			9,971
Treasury stock		(323,580	)		(323,095	)

Total stockholders’ equity	$	766,259		$	689,994

Total liabilities and stockholders’ equity	$	1,171,983		$	1,125,364

BLACK BOX CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS


	Three-months ended						Fiscal Year ended
	March 31						March 31
In thousands	2011			2010			2011			2010

Operating Activities
Net income	$	12,258		$	7,496		$	52,862		$	34,503
Adjustments to reconcile net income to net cash provided by (used for) operating activities
Intangibles amortization and depreciation		4,550			7,826			18,222			22,923
(Gain) loss on sale of property		(4	)		3			(71	)		13
Deferred taxes		2,227			(1,320	)		7,806			(123	)
Tax impact from stock options		(75	)		5			920			771
Stock compensation expense		2,271			1,753			10,270			6,775
Change in fair value of interest-rate swap		(1,048	)		61			(2,968	)		(65	)
Changes in operating assets and liabilities (net of acquisitions)
Accounts receivable, net		(1,232	)		10,212			(10,393	)		21,780
Inventories, net		2,779			2,092			459			5,709
Costs/estimated earnings in excess of billings on uncompleted contracts		7,475			9,808			(17,537	)		(12,815	)
All other assets		(766	)		(2,013	)		(1,738	)		4,024
Billings in excess of costs/estimated earnings on uncompleted contracts		(2,577	)		(937	)		2,146			(4,641	)
All other liabilities		(7,065	)		(15,171	)		(5,113	)		(16,906	)

Net cash provided by (used for) operating activities	$	18,793		$	19,815		$	54,865		$	61,948
Investing Activities
Capital expenditures	$	(2,243	)	$	(727	)	$	(5,149	)	$	(2,300	)
Capital disposals		21			24			119			156
Acquisition of businesses (payments)/recoveries		—			1			(12,811	)		(10,686	)
Prior merger-related (payments)/recoveries		—			(553	)		(1,829	)		(8,291	)

Net cash provided by (used for) investing activities	$	(2,222	)	$	(1,255	)	$	(19,670	)	$	(21,121	)
Financing Activities
Proceeds from borrowings	$	64,135		$	38,445		$	238,950		$	169,335
Repayment of borrowings		(81,598	)		(63,090	)		(269,234	)		(208,388	)
Deferred financing costs		—			—			(700	)		—
Proceeds from the exercise of stock options		4,527			—			9,239			—
Purchase of treasury stock		(2	)		—			(485	)		—
Payment of dividends		(1,066	)		(1,053	)		(4,232	)		(4,210	)

Net cash provided by (used for) financing activities	$	(14,004	)	$	(25,698	)	$	(26,462	)	$	(43,263	)
Foreign currency exchange impact on cash	$	685		$	(1,033	)	$	1,594		$	(399	)

Increase / (decrease) in cash and cash equivalents	$	3,252		$	(8,171	)	$	10,327		$	(2,835	)
Cash and cash equivalents at beginning of period		27,960			29,056			20,885			23,720

Cash and cash equivalents at end of period	$	31,212		$	20,885		$	31,212		$	20,885

Non-GAAP Financial Measures

As a supplement to United States Generally Accepted Accounting Principles (“GAAP”), the Company provides non-GAAP financial measures such as free cash flow, cash provided by operating activities excluding restructuring payments (see below for reference), operating net income, operating earnings per share (“EPS”), Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), Adjusted EBITDA, adjusted operating income and same-office revenue comparisons to illustrate the Company’s operational performance. These non-GAAP financial measures exclude the impact of certain items and, therefore, have not been calculated in accordance with GAAP. Pursuant to the requirements of Regulation G, the Company has provided explanations of the Company’s management (“Management”) regarding their use and the usefulness of non-GAAP financial measures, definitions of the non-GAAP financial measures and reconciliations to the most directly comparable GAAP financial measures, which are provided below.

Management uses non-GAAP financial measures (a) to evaluate the Company’s historical and prospective financial performance as well as its performance relative to its competitors, (b) to set internal sales targets and associated operating budgets, (c) to allocate resources, (d) to measure operational profitability and (e) as an important factor in determining variable compensation for Management and its team members. Moreover, the Company has historically reported these non-GAAP financial measures as a means of providing consistent and comparable information with past reports of financial results.

While Management believes these non-GAAP financial measures provide useful supplemental information to investors, there are limitations associated with the use of non-GAAP financial measures. The limitations include (i) the non-GAAP financial measures are not prepared in accordance with GAAP, are not reported by all of the Company’s competitors and may not be directly comparable to similarly-titled measures of the Company’s competitors due to potential differences in the exact method of calculation, (ii) the non-GAAP financial measures exclude certain non-cash amortization of intangible assets on acquisitions, however, they do not specifically exclude the added benefits of these costs, such as revenue and contributing operating margin, (iii) the non-GAAP financial measures exclude non-cash asset write-up depreciation expense on acquisitions related to acquisitions made during recent years which is derived from the book value to fair market value write-up on acquired assets, (iv) the non-GAAP financial measures exclude the non-cash change in fair value of the Company’s interest-rate swaps which will continue to impact the Company’s earnings until the interest-rate swaps are settled, (v) the non-GAAP financial measures exclude costs for employee severance and facility consolidations (“employee severance and facility consolidation costs”) incurred during the periods reported in an attempt to right-size the organization and more appropriately align the expense structure with anticipated revenues and changing market demand for its solutions and services that will impact future operating results, (vi) the non-GAAP financial measures exclude historical stock option granting practices investigation and related matters costs, including costs associated with the related Securities and Exchange Commission (“SEC”) investigation, shareholder derivative lawsuit, tax matters and insurance/indemnification matters, (vii) the non-GAAP financial measures exclude costs of settlement or resolution arising from current legal matters associated with the ongoing operations of the Company (“current legal matters costs”) and (viii) there is no assurance the excluded items in the non-GAAP financial measures will not occur in the future. The Company compensates for these limitations by using these non-GAAP financial measures as supplements to GAAP financial measures and by reviewing the reconciliations of the non-GAAP financial measures to their most comparable GAAP financial measures.

Non-GAAP financial measures are not in accordance with, or an alternative for, GAAP. The Company’s non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measurements, and should be read only in conjunction with the Company’s consolidated financial statements prepared in accordance with GAAP.

Free cash flow

Free cash flow is defined by the Company as cash provided by operating activities less net capital expenditures, plus or minus foreign currency translation adjustments, plus proceeds from stock option exercises. Management’s reasons for exclusion of each item are explained in further detail below.

Net capital expenditures
The Company believes net capital expenditures must be taken into account along with cash provided by operating activities to more properly reflect the actual cash available to the Company. Net capital expenditures are typically material and directly impact the availability of the Company’s operating cash. Net capital expenditures are comprised of capital expenditures and capital disposals.

Foreign currency exchange impact on cash
Due to the size of the Company’s international operations, and the ability of the Company to utilize cash generated from foreign operations locally without the need to convert such currencies to U.S. dollars on a regular basis, the Company believes that it is appropriate to adjust its operating cash flows to take into account the positive and/or negative impact of such adjustments as such adjustment provides an appropriate measure of the availability of the Company’s operating cash on a world-wide basis. A limitation of adjusting cash flows to account for the foreign currency impact is that it may not provide an accurate measure of cash available in U.S. dollars.

Proceeds from stock option exercises
The Company believes that proceeds from stock option exercises should be added to cash provided by operating activities to more accurately reflect the actual cash available to the Company. The Company has demonstrated a recurring inflow of cash related to its stock-based compensation plans and, since this cash is immediately available to the Company, it directly impacts the availability of the Company’s operating cash. The amount of proceeds from stock option exercises is dependent upon a number of variables, including the number and exercise price of outstanding options and the trading price of the Company’s common stock. In addition, the timing of stock option exercises is under the control of the individual option holder and is not in the control of the Company. As a result, there can be no assurance as to the timing or amount of any proceeds from stock option exercises.

A reconciliation of cash provided by operating activities to free cash flow is presented below:


	4Q11			3Q11			4Q10			FY11			FY10

Cash provided by operating activities	$	18,793		$	27,933		$	19,815		$	54,865		$	61,948
Net capital expenditures		(2,222	)		(968	)		(703	)		(5,030	)		(2,144	)
Foreign currency exchange impact on cash		685			(78	)		(1,033	)		1,594			(399	)

Free cash flow before stock option exercises	$	17,256		$	26,887		$	18,079		$	51,429		$	59,405
Proceeds from stock option exercises		4,527			4,432			—			9,239			—

Free cash flow	$	21,783		$	31,319		$	18,079		$	60,668		$	59,405

Cash provided by operating activities excluding restructuring payments

Cash provided by operating activities excluding restructuring payments is defined by the Company as cash provided by operating activities plus restructuring payments. Restructuring payments are the cash payments made during the period for employee severance and facility consolidation costs. The Company believes that restructuring payments should be added to cash provided by operating activities to more accurately reflect the cash flow from operations.

A reconciliation of cash provided by operating activities to cash provided by operating activities excluding restructuring payments is presented below:


	4Q11		3Q11		4Q10		FY11		FY10

Cash provided by operating activities	$	18,793	$	27,933	$	19,815	$	54,865	$	61,948
Restructuring payments		906		1,494		1,873		5,232		9,500

Cash provided by operating activities excluding restructuring payments	$	19,699	$	29,427	$	21,688	$	60,097	$	71,448

Operating net income and operating earnings per share

Management believes that operating net income, defined by the Company as net income plus reconciling items, and operating EPS, defined as operating net income divided by weighted average common shares outstanding (diluted), provide investors additional important information to enable them to assess, in a way Management assesses, the Company’s current and future operations. Reconciling items include amortization of intangible assets on acquisitions, asset write-up depreciation expense on acquisitions, the change in fair value of the interest-rate swaps, employee severance and facility consolidation costs, historical stock option granting practices investigation and related matters costs and current legal matters costs. Management’s reason for exclusion of each item is explained in further detail below.

Amortization of intangible assets on acquisitions
The Company incurs non-cash amortization expense from intangible assets related to various acquisitions it has made in recent years. Management excludes these expenses and their related tax impact for the purpose of calculating non-GAAP financial measures when it evaluates the continuing operational performance of the Company because these costs are fixed at the time of an acquisition, are then amortized over a period of several years after the acquisition and generally cannot be changed or influenced by Management after the acquisition.

Asset write-up depreciation expense on acquisitions
The Company incurs non-cash asset write-up depreciation expense on acquisitions related to acquisitions made during recent years. Specifically, this non-cash expenditure is derived from the book value to fair market value write-up on acquired assets. Asset write-ups are depreciated over their remaining useful life which generally falls between one to five years. Management excludes these expenses and their related tax impact for the purpose of calculating non-GAAP financial measures when it evaluates the continuing operational performance of the Company because these costs are fixed from acquisition to the end of the asset’s useful life and generally cannot be changed or influenced by Management after the acquisition.

Change in fair value of the interest-rate swaps
To mitigate the risk of interest-rate fluctuations associated with the Company’s variable rate debt, the Company entered into two separate interest-rate swaps (“interest-rate swaps”) that do not qualify as a cash flow hedge. Thus, the Company records the change in fair value of the interest-rate swaps as an asset/liability within the Company’s Condensed Consolidated Balance Sheets with the offset to Interest expense (income) within the Company’s Condensed Consolidated Statements of Income. Management excludes this non-cash expense and the related tax impact for the purpose of calculating non-GAAP financial measures when it evaluates the continuing operational performance of the Company because these costs generally cannot be changed or influenced by Management.

Employee severance and facility consolidation costs
The Company believes that incurring costs in the current period(s) in an attempt to right-size the organization and more appropriately align the expense structure with anticipated revenues and changing market demand for its solutions and services will result in a long-term positive impact on financial performance in the future. Employee severance and facility consolidation costs are presented in accordance with GAAP in the Company’s Condensed Consolidated Statements of Income. However, due to the amount of additional costs incurred during a single or possibly successive periods, Management believes that exclusion of these costs and their related tax impact provides a more accurate reflection of the Company’s ongoing financial performance.

Historical stock option granting practices investigation and related matters costs
The Company incurred costs in connection with its investigation of historical stock option granting practices, including the related SEC investigation, shareholder derivative lawsuit, tax matters and insurance/indemnification matters. Management excludes these expenses and their related tax impact for the purpose of calculating non-GAAP financial measures when it evaluates the continuing operational performance of the Company because these costs are generally non-recurring and cannot be changed or influenced by Management.

Current legal matters costs
The Company incurs costs arising from current legal matters associated with the ongoing operations of the Company. Management excludes these expenses and their related tax impact for the purpose of calculating non-GAAP financial measures when it evaluates the continuing operational performance of the Company because these costs are generally non-recurring and cannot be changed or influenced by Management.

The following table represents the Company’s pre-tax reconciling items:


	4Q11			3Q11			4Q10		FY11			FY10

Non-cash charges
Amortization of intangible assets on acquisitions	$	3,083		$	2,890		$	5,886	$	12,111		$	15,150
Asset write-up depreciation expense on acquisitions		—			—			348		—			476
Change in fair value of the interest-rate swaps		(1,048	)		(1,074	)		61		(2,968	)		(65	)

Total non-cash charges	$	2,035		$	1,816		$	6,295	$	9,143		$	15,561
Cash charges
Employee severance and facility consolidation costs	$	—		$	—		$	1,935	$	—		$	4,557
Historical stock option granting practices investigation and related matters costs		—			—			255		—			4,829
Current legal matters costs		—			—			1,093		—			3,238

Total cash charges	$	—		$	—		$	3,283	$	—		$	12,624

Total pre-tax reconciling items	$	2,035		$	1,816		$	9,578	$	9,143		$	28,185

A reconciliation of net income to operating net income is presented below:


	4Q11			3Q11			4Q10			FY11			FY10

Net income	$	12,258		$	13,910		$	7,496		$	52,862		$	34,503
% of Revenue		4.8	%		5.0	%		3.1	%		4.9	%		3.6	%
Reconciling items, after tax ¹		1,260			1,126			6,270			5,667			17,900

Operating net income	$	13,518		$	15,036		$	13,766		$	58,529		$	52,403
% of Revenue		5.3	%		5.4	%		5.7	%		5.5	%		5.5	%

The effective tax rate utilized to determine Reconciling items, after tax, for each period, is the effective tax rate utilized to determine Net income for such period.

A reconciliation of diluted EPS to operating EPS is presented below:


	4Q11		3Q11		4Q10		FY11		FY10

Diluted EPS	$	0.68	$	0.78	$	0.43	$	2.97	$	1.97
EPS impact of reconciling items		0.07		0.06		0.35		0.32		1.02

Operating EPS	$	0.75	$	0.84	$	0.78	$	3.29	$	2.99

EBITDA and Adjusted EBITDA

Management believes that EBITDA, defined as Net income plus provision for income taxes, interest, depreciation and amortization, is a widely accepted measure of profitability that may be used to measure the Company’s ability to service its debt. Adjusted EBITDA, defined as EBITDA plus stock-based compensation expense, may also be used to measure the Company’s ability to service its debt. Stock-based compensation is an integral part of ongoing operations since it is considered similar to other types of compensation to employees. However, Management believes that varying levels of stock-based compensation expense could result in misleading period-over-period comparisons and is providing an adjusted disclosure which excludes stock-based compensation.

A reconciliation of income before provision for income taxes to EBITDA and Adjusted EBITDA is presented below:


	4Q11		3Q11		4Q10		FY11		FY10

Net income	$	12,258	$	13,910	$	7,496	$	52,862	$	34,503
Provision for income taxes		7,531		8,528		3,619		32,418		19,824
Interest		970		1,028		2,290		5,430		8,882
Depreciation/Amortization		4,550		4,376		7,826		18,222		22,923

EBITDA	$	25,309	$	27,842	$	21,231	$	108,932	$	86,132
Stock-based compensation expense		2,271		2,493		1,753		10,270		6,775

Adjusted EBITDA	$	27,580	$	30,335	$	22,984	$	119,202	$	92,907

Supplemental Information

The following supplemental information, including geographical segment results, service type results, same-office revenue comparisons and significant balance sheet ratios and other information is being provided for comparisons of reported results for the fourth quarter of Fiscal 2011, third quarter of Fiscal 2011, fourth quarter of Fiscal 2010 and/or Fiscal 2011 and Fiscal 2010. All dollar amounts are in thousands unless noted otherwise.

Geographical Segment Results

Management is presented with and reviews revenues, operating income and adjusted operating income by geographical segment. Adjusted operating income is defined by the Company as operating income plus reconciling items. Reconciling items include amortization of intangible assets on acquisitions, asset write-up depreciation expense on acquisitions, employee severance and facility consolidation costs, historical stock option granting practices investigation and related matters costs and current legal matters costs. See above for additional details provided by Management regarding non-GAAP financial measures. Revenues, operating income and adjusted operating income for North America, Europe and All Other are presented below:


	4Q11			3Q11			4Q10			FY11			FY10

Revenues
North America	$	220,702		$	239,455		$	207,598		$	931,181		$	829,233
Europe		25,035			27,446			24,254			100,221			99,502
All Other		9,293			9,778			9,031			36,827			32,658

Total	$	255,030		$	276,679		$	240,883		$	1,068,229		$	961,393
Operating income
North America	$	18,189		$	18,749		$	9,345		$	76,789		$	47,623
% of North America revenues		8.2	%		7.8	%		4.5	%		8.2	%		5.7	%
Europe	$	1,692		$	2,851		$	2,393		$	8,032		$	10,148
% of Europe revenues		6.8	%		10.4	%		9.9	%		8.0	%		10.2	%
All Other	$	1,302		$	1,855		$	1,688		$	6,237		$	5,272
% of All Other revenues		14.0	%		19.0	%		18.7	%		16.9	%		16.1	%

Total	$	21,183		$	23,455		$	13,426		$	91,058		$	63,043
% of Total revenues		8.3	%		8.5	%		5.6	%		8.5	%		6.6	%
Reconciling items (pre-tax)
North America	$	3,083		$	2,890		$	9,167		$	12,111		$	26,967
Europe		—			—			318			—			1,210
All Other		—			—			32			—			73

Total	$	3,083		$	2,890		$	9,517		$	12,111		$	28,250
Adjusted operating income
North America	$	21,272		$	21,639		$	18,512		$	88,900		$	74,590
% of North America revenues		9.6	%		9.0	%		8.9	%		9.5	%		9.0	%
Europe	$	1,692		$	2,851		$	2,711		$	8,032		$	11,358
% of Europe revenues		6.8	%		10.4	%		11.2	%		8.0	%		11.4	%
All Other	$	1,302		$	1,855		$	1,720		$	6,237		$	5,345
% of All Other revenues		14.0	%		19.0	%		19.0	%		16.9	%		16.4	%

Total	$	24,266		$	26,345		$	22,943		$	103,169		$	91,293
% of Total revenues		9.5	%		9.5	%		9.5	%		9.7	%		9.5	%

Service Type Results

Management is presented with and reviews revenues and gross profit for Data Services, Voice Services and Hotline Services which are presented below:


	4Q11			3Q11			4Q10			FY11			FY10

Revenues
Data Services	$	59,883		$	62,890		$	46,855		$	230,719		$	187,535
Voice Services		148,158			164,244			148,537			648,512			593,562
Hotline Services		46,989			49,545			45,491			188,998			180,296

Total	$	255,030		$	276,679		$	240,883		$	1,068,229		$	961,393
Gross profit
Data Services	$	15,434		$	15,427		$	12,881		$	59,287		$	51,048
% of Data Services revenues		25.8	%		24.5	%		27.5	%		25.7	%		27.2	%
Voice Services	$	49,211		$	52,667		$	48,862		$	210,558		$	197,673
% of Voice Services revenues		33.2	%		32.1	%		32.9	%		32.5	%		33.3	%
Hotline Services	$	22,079		$	22,558		$	22,122		$	87,265		$	86,660
% of Hotline Services revenues		47.0	%		45.5	%		48.6	%		46.2	%		48.1	%

Total	$	86,724		$	90,652		$	83,865		$	357,110		$	335,381
% of Total revenues		34.0	%		32.8	%		34.8	%		33.4	%		34.9	%

Same-office revenue comparisons

Management is presented with and reviews revenues on a same-office basis which excludes the effects of revenues from acquisitions. While the information provided below is presented on a consolidated basis, all of the revenue from offices added as shown below relates to Voice Services in the Company’s North America segment. Reported same-office comparisons of consolidated revenues, therefore, can be determined by excluding the revenues for Voice Services in the Company’s North America segment from offices added since April 1, 2009 (for comparison of 4Q11 to 4Q10 and FY11 to FY10) or October 3, 2010 (for comparison of 4Q11 to 3Q11) as shown below.

Information on quarterly revenues on a same-office basis compared to the same period last year is presented below:


	4Q11			4Q10			%Change

Reported revenues	$	255,030		$	240,883			6	%
Less revenue from Voice Services offices added since 4/1/09 (1Q10)		(10,819	)		(7,158	)

Reported revenues on same-office basis	$	244,211		$	233,725			4	%
Foreign currency impact		(1,187	)		—

Revenues on same-office basis (excluding foreign currency impact)	$	243,024		$	233,725			4	%

Information on year-to-date revenues on a same-office basis compared to the same period last year is presented below:


	FY11			FY10			%Change

Reported revenues	$	1,068,229		$	961,393			11	%
Less revenue from Voice Services offices added since 4/1/09 (1Q10)		(36,365	)		(11,561	)

Reported revenues on same-office basis	$	1,031,864		$	949,832			9	%
Foreign currency impact		(5	)		—

Revenues on same-office basis (excluding foreign currency impact)	$	1,031,859		$	949,832			9	%

Information on revenues on a same-office basis compared to the sequential quarter is presented below:


	4Q11			3Q11			%Change

Reported revenues	$	255,030		$	276,679			(8	)%
Less revenue from Voice Services offices added since 10/3/10 (3Q11)		(4,650	)		(4,323	)

Reported revenues on same-office basis	$	250,380		$	272,356			(8	)%
Foreign currency impact		(754	)		—

Revenues on same-office basis (excluding foreign currency impact)	$	249,626		$	272,356			(8	)%

Significant Balance Sheet ratios and Other Information

Information on certain balance sheet ratios, backlog and headcount is presented below. Dollar amounts are in millions.


	4Q11				3Q11				4Q10

Accounts receivable
Gross accounts receivable	$	163.8			$	162.2			$	150.7
Reserve $ / %		7.1	4.3	%		7.6	4.7	%		9.5	6.3	%

Net accounts receivable	$	156.7			$	154.6			$	141.2
Net days sales outstanding	49 days				48 days				51 days
Inventory
Gross inventory	$	71.9			$	74.8			$	71.5
Reserve $ / %		19.9	27.6	%		20.2	27.0	%		20.0	28.0	%

Net inventory	$	52.0			$	54.6			$	51.5
Net inventory turns		9.2x				10.1x				8.8x
Six-month order backlog	$	223			$	212			$	203
Team members		4,413				4,482				4,348