Tellza Communications Inc.
TSX : TEL

Tellza Communications Inc.

October 30, 2014 17:30 ET

Tellza Announces Q3 Financial Results

Revenue for the Nine Months Ended September 30 Climbs to US$196M - Up 75% Year Over Year

TORONTO, ONTARIO--(Marketwired - Oct. 30, 2014) - Tellza Communications Inc. (TSX:TEL) announced its unaudited financial results for the nine months ended September 30, 2014.

Revenue was $196 Million USD compared to $112 Million USD in 2013, growth of 75%. Net Income was $0.7 million USD compared to net income of $1.8 million USD in 2013. The decrease in Net Income is primarily related to an increase in depreciation and amortization related to CAPEX and business acquisitions. Year to date EBITDA* was $2.1 million USD compared to $3.0 million USD in 2013, a decrease of 31%. The reduction in EBITDA is related to tighter margins in our core business, and start-up costs related to routedynamix.

Tellza completed Q3 2014 with $1.3 Million USD in cash and available borrowings of $5.0 Million.

"We are excited about our progress in 2014. We believe we have laid a solid foundation for 2015 and beyond," said Gary Clifford, Executive Chairman.

CONSOLIDATED STATEMENTS OF OPERATIONS
[amounts in thousands of U.S. dollars, except per share information]
For the three and nine months ended September 30, 2014 2013 2014 2013
$ $ $ $
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
Revenue 71,839 38,224 195,971 112,066
Cost of revenue 69,511 36,166 189,517 105,999
Gross margin 2,328 2,058 6,454 6,067
Operating expenses 1,746 1,108 4,399 3,021
Depreciation of property and equipment 75 32 222 94
Amortization of intangible assets 275 103 850 312
Stock-based compensation 3 13 9 39
Minority Interest 7 - 23 -
Interest and debt costs -18 9 -18 25
Gain on retirement of debt - - - -
2,088 1,265 5,485 3,491
Income before income taxes 240 793 969 2,576
Provision for (recovery of) income taxes
Current - 280 - 285
Deferred 43 (60 ) 278 510
43 220 278 795
Net and comprehensive income for the period 197 573 691 1,781
Earnings per share
- basic and diluted 0.00 0.00 0.00 0.01
Weighted-average number of common shares
- basic and diluted 186,700,000 151,231,492 186,546,547 151,231,492

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

The Company's corporate profile is located at www.tellza/investors.

About Tellza

Tellza is a global communications company operating under several brands including Route Dynamix, Phonetime, Tel3, MatchCom and Tellza Technologies. 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 www.sedar.com which contains all securities files.

* 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:

YTD Cumulative
2011 2012 2013 2014 - Q3 2011 - 2014 Q3
$ $ $ $ $
Net Income before taxes 2,802 2,321 3,236 969 9,328
Interest expense 338 160 33 -18 513
Stock based compensation 113 53 12 9 187
Amortization 1,056 850 556 850 3,312
Depreciation 517 120 127 222 986
Minority interest - - - 23 23
Non-Recurring Gain - (260) - 0 (260)
Non-Recurring Gain (2,290) (1) - 0 (2,291)
2,536 3,243 3,964 2,055 11,798

Contact Information

  • Tellza Communications Inc.
    Gary Clifford
    Executive Chairman
    +647 281 1831
    gclifford@tellza.com

    Tellza Communications Inc.
    Michael Vazquez
    Chief Executive Officer
    +954-608-5058
    mike@tellza.com