SOURCE: eLEC Communications Corp.

March 02, 2007 09:00 ET

eLEC Reports Fiscal 2006 Results

WHITE PLAINS, NY -- (MARKET WIRE) -- March 2, 2007 -- eLEC Communications Corp. (OTCBB: ELEC), a communications provider that offers standard wireline and broadband telephone services, announced results for the fiscal year ended November 30, 2006.

eLEC reported a net loss for the year of $2,345,000, or $0.14 per share, compared to a net loss of approximately $2,266,000, or $0.14 per share, for the prior fiscal year. The loss from operations amounted to $2,287,000 in fiscal 2006, an improvement of $115,000 from an operating loss of $2,402,000 reported in fiscal 2005. In conjunction with eLEC's transition away from providing a retail wireline telephone service to providing a wholesale broadband telephone service, revenues in fiscal 2006, which consisted primarily of retail wireline service, decreased by $7,524,000, or 47%, to $8,357,000 from $15,881,000 in fiscal 2005.

eLEC's CEO, Paul Riss, noted, "We continue to make significant progress in our evolution into a wholesale Internet telephone service provider. The sale of our wireline business is still moving forward and we have received notification that all regulatory approvals required for the sale should be completed by April 8, 2007. Consequently, we have extended the closing deadline for the purchaser of our wireline business until April 12, 2007 to accommodate the timetables of various public service commissions. We believe the planned phase out of our wireline business is coming at a very good time as we are beginning to see the growth in sales volume in our broadband phone services that we believe we can achieve."

Riss continued, "The invoicing of our broadband voice customers in the first quarter of fiscal 2007 will exceed our broadband voice revenue for the entire 2006 fiscal year. In addition, for our broadband phone business, we signed 10 new wholesale customers in the last 30 days, giving us a total of 63 contracts. We believe several of these new customers will be able to begin generating Internet telephony revenues in the second quarter. We believe we have been successful in attracting new wholesale clients that already have a customer base to which they provide broadband services, and that our wholesale customers realize they need to find a quick and reliable method of providing broadband voice services to their customers before companies like Vonage reach their customers. Our strategy of empowering broadband providers to sell voice services to their existing base of end-users continues to make sense to us because under our strategy we will not incur the high costs of new customer acquisitions which are reported to be more than $500 a subscriber by other broadband voice companies that sell to individual end-users."

The following types of broadband medium providers are currently using eLEC's broadband voice service:

--  Cable providers
--  Internet service providers
--  Wi-Fi providers
--  Broadband over power line providers (BPL)
--  Satellite providers
Setting out to build a ubiquitous voice offering drove eLEC to build a network that did not discriminate -- voice over Wi-Fi alongside voice over cable alongside voice over BPL. All types of voice over broadband work in harmony on the same network.

Complete details of eLEC's results of operations will be set forth in the company's Annual Report on Form 10-K for the year ended November 30, 2006, which will be filed with the Securities and Exchange Commission.

About eLEC Communications

eLEC Communications Corp., headquartered in White Plains, NY, is a communication services holding company that is taking advantage of the convergence of the technological and regulatory developments in the Internet and telecommunications markets. eLEC's wholly owned subsidiaries provide an integrated suite of communications services to business and residential customers, including local, long distance, and international wireline and broadband telephone services. eLEC is changing its name to Pervasip Corp. to reflect its focus on IP services, which are becoming the universal network platform for voice, data and video services. The name change will be voted on at the next shareholders' meeting. For more information, visit

This release contains forward-looking statements that involve risks and uncertainties. eLEC's actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include, among others, certain risks and uncertainties over which the company may have no control. For further discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see the discussions contained in eLEC's Annual Report on Form 10-K for the year ended November 30, 2006 and any subsequent SEC filings.

Contact Information

  • For more information, please contact:

    Kim Martin
    eLEC Communications Corp.
    Email Contact