Phonetime Inc.
TSX : PHD

Phonetime Inc.

November 17, 2010 13:07 ET

Investor Update and Conference Call

Phonetime Returns to Profitability Reporting Net Income of $0.02 Per Share in Third Quarter 2010

PICKERING, ONTARIO--(Marketwire - Nov. 17, 2010) - Phonetime Inc. (TSX:PHD) - At 5pm today, interested parties are invited to an open forum discussion with Phonetime Chairman and CEO, Gary Clifford.

DIAL IN NUMBER – 1 905 361 8302 (press 6) or 1 954 624 8482

Financial highlights

Revenue for the three and nine months ended September 30, 2010 was $35 million and $114 million compared to $37 million and $106 million in the same periods in 2009, respectively. Margins for the three and nine months ended September 30, 2010 were $3.4 million and $8.5 million compared to $2.6 million and $10.0 million, respectively, in 2009. In early 2010, the Company experienced a drop in margins and in recent quarters margins have been restored while maintaining revenue.

The Company's net income for the three months ended September 30, 2010 was $2.1 million or $0.02 per share. In the nine months ended September 30, 2010, the Company experienced a net loss of ($1.5 million) or ($0.02) per share. In 2009, the net loss for the three months and nine months ended September 30th was ($1.4 million) and ($1.9 million) or ($0.01) per share and ($0.02) per share, respectively.

Investment Highlights (TSX : PHD – Stock Price $0.07 – Market Capitalization $8M)
  • Phonetime returns to profitability and to focus on its core business in Q3 2010.
  • 2010-Q3 EPS of $0.02 and YTD ($0.01); YTD EBITDA of $1.7M and $0.9M.
  • Raised $3M in equity
  • Lowered liabilities by $8M.
  • Revenue $35M in 2010–Q3 and $114M YTD.
  • Management shuffle in April 2010; founders removed; new management inserted.
  • Disposition of non-core assets in August 2010; Staff reduced to 50 from 138.
  • Telecommunications B2B service provider; 60 Million calls/month and 4 Billion minute/year.
  • Expect to resume growth in 2011 now that the back office and infrastructure in place.

COMPANY OVERVIEW

Phonetime is a global telecommunications carrier. Phonetime handles the procurement and completion of long distance services to large and small telecommunications providers around the World. Phonetime is a best in class provider of outsourced telecommunications services. Phonetime entered this market segment in 2006 and grew rapidly through 2010. The growth experienced was both organic and acquisition based. In 2007, with the ambition of achieving a global footprint, the Company acquired Symphony Telecommunications, an African based carrier. In 2010, due to a lack of consolidated profitability, the Company narrowed its business focus to restore profitability. This difficult decision allowed the Company to focus on its largest value creation opportunity for shareholders. As a result, we exited all other opportunities.

Phonetime is currently capitalized with 147 million shares and $4.3 million in debt; Phonetime also have an additional 72 million warrants and 9 million stock options outstanding at various strike prices.

Caution Regarding Forward Looking Information:

This document contains forward-looking statements, which may be identified by words like "expects", "anticipates", "plans", "intends", "indicates" or similar expressions. These statements are not a guarantee of future performance and are inherently subject to risks and uncertainties. Phonetime's actual results could differ materially from those currently indicated and anticipated due to a number of factors set forth in reports and other documents filed by the Company with Canadian securities regulatory authorities from time to time. See www.sedar.com which contains all securities files of Phonetime. Investors are cautioned to read all public filings of the Company before making an investment decision. People who are not experts in investments and in understand financial information or need advice are strongly encouraged to seek the advice of appropriate experts before making any investment decision, including a decision to invest in Phonetime. 

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