Tellza Communications Inc.

Tellza Communications Inc.

April 27, 2016 16:01 ET

Tellza Announces 2016 Q1 Financial Results

Revenue US$92 Million, up 57% year over year

TORONTO, ONTARIO--(Marketwired - April 27, 2016) - Tellza Communications Inc. (TSX:TEL) announced its unaudited financial results for the first quarter of 2016.

Revenue in Q1 2016 was US$92 Million compared to US$59 Million in Q1 2015, an increase of US$33 Million or 57% year over year. EBITDA* was US$0.7 million compared to US$0.4 million in 2015. While we conduct our business primarily in USD, we are based in Canada and our common shares are listed and trade on the Toronto Stock Exchange in CDN dollars. Reporting in CDN dollars, our EBITDA* is CDN$0.9 million for Q1 2016 compared to CDN$0.5 million in Q1 2015. Net Income for Q1 2016 was US$0.2 million compared to a net loss of US$41,000 in Q1 2015.

"Tellza operates in the "nearly free" market for communications. Our long term investment in systems has allowed us to remain profitable, while many of our competitors have commenced exiting the business. We believe that the "nearly free" communications market will remain strong and sizeable into the future," said Gary Clifford, Executive Chairman. "In recent months, we have utilized the profits from our Communications business to expand into the Financial Services Product Support Business via our investments in Merkez and Rightway."

The Company's financial statements and other disclosures are available on SEDAR.

The Company's corporate profile is located at

About Tellza

Tellza is a Technology Company operating in the Communication market. The business is organized into three business units: Tellza Communications, Tellza Technologies and Tellza Investments. Tellza Communications is a global communications company operating under several brands: Route Dynamix, Phonetime, Tel3, and MatchcoM. Tellza Technologies provides real time big data management tools for the telecommunications market. Tellza Investments is focused on Financial Products Support Business through our portfolio investments in Merkez and Rightway. Tellza is a public company listed on the Toronto Stock Exchange (TEL).

Caution Regarding Forward Looking Information:

This press release 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. Tellza's actual results could differ materially from those currently 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 which contains all securities files.

Tellza Communications Inc. March 31, December 31,
(USD - 000's) 2016 2015
Cash $ 1,358 $ 1,425
Total Assets $ 57,124 $ 57,421
Shareholders' Equity $ 17,504 $ 17,347
Debt - -
Working capital $ 1,216 $ 1,192
For three months ended (USD - 000's) March 31, March 31,
2016 2015
Cashflow from operations $ 776 $ 485
Changes in non-cash working capital $ (139 ) $ (6,316 )
Operating cash flows $ 637 $ (5,831 )
Investing activities $ (704 ) $ (566 )
Financing activities $ - $ 1,304
For the three months ended March 31, 2016 2015
($'000's USD) $ $
Revenue 92,101 58,762
Cost of revenue 89,460 57,036
Gross margin 2,641 1,726
Operating expenses 1,922 1,328
Income before undernoted: 719 398
Depreciation of property and equipment 124 123
Amortization of intangible assets 200 296
Interest and debt costs 27 17
351 436
Income before income taxes 368 (38 )
Provision for income taxes
Current - -
Deferred 90 (30 )
90 (30 )
Net income and comprehensive income from continuing operations 278 (8 )
Discontinued operations (73 ) (33 )
Net income and comprehensive income 205 (41 )

*We define EBITDA and Cash Profits as earnings before taxes, depreciation and amortization, stock based compensation, and interest. EBITDA, which is a non-GAAP financial measure, it is a standard measure used in the telecommunications industry to assist in understanding and comparing operating results. EBITDA is reviewed regularly by management and our Board of Directors in assessing performance and in making decisions regarding the ongoing operations of the business and the ability to generate cash flows. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with IFRS. EBITDA is not a measure of financial performance nor does it have a standardized meaning under IFRS. In evaluating these measures, investors should consider that the methodology applied in calculating as such measures may differ among companies and analysts. Below is a reconciliation of "EBITDA" to net income for the periods presented:

Three months ended March 31, 2016 2015
Net income and comprehensive income for the period $ 278 $ (41 )
Provision for income taxes $ 90 $ (30 )
Depreciation of property and equipment $ 124 $ 123
Amortization of intangible assets $ 200 $ 296
Interest and debt costs $ 27 $ 17
EBITDA $ 719 $ 365

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