Telehop Announces Second Quarter 2012 Financial Results
20 Août 2012 - 1:18PM
PR Newswire (Canada)
Management targets margins and consumer credit requirements to
deliver positive operating income and EBITDA TORONTO, Aug. 23, 2012
/CNW/ - Telehop Communications Inc. ("Telehop" or the "Company"),
today announced its financial performance during the second quarter
ended June 30, 2012. During the second quarter of 2012, the Company
increased EBITDA to $27,149 from $(141,760) and increased operating
income to $5,210 from an operating loss of $(178,929) during the
same period last year. This is the first quarter in six
quarters that the Company has been EBITDA and operating income
positive. The Company has focused on increasing gross margins
specifically on the Retail revenue, reducing low margin wholesale
customers and tightening credit requirements to the entire
installed base. Continued performance improvements are expected as
the Company has developed a more sophisticated marketing database
to gain further customer insights and drive programs to increase
the average revenue per user and reduce churn. "We are beginning to
see a return on our efforts over the past year," said Rajiv Jagota,
President CEO, Telehop. "The structure and programs are now in
place for us to move ahead on a constructive footing. We look
forward to making further progress as we execute on our plan for
growth." The Company's financials reflected a number of events of
note. Details of these events are summarized below: --
Telecommunication customer payment of $102,863 was delayed until
July 3rd resulting in higher accounts receivable levels and lower
cash provided by operating activities, -- Additional second quarter
costs incurred in the amount of $32,907 as a result of termination
costs for prior executive. FINANCIAL OVERVIEW
_____________________________________________________________________
| | | | | Consolidated | | | | Highlights |Three months ended June
30|Six months ended June 30|
|_________________|__________________________|________________________|
| | 2012| 2011| 2012| 2011|
|_________________|__________|_______________|__________|_____________|
|Revenue |$2,385,727| $2,647,490|$4,837,802| $5,318,594|
|_________________|__________|_______________|__________|_____________|
|Gross margin |$1,095,969| $1,173,560|$2,714,642| $2,312,092|
|_________________|__________|_______________|__________|_____________|
|Gross margin % | 45.9%| 44.3%| 43.9%| 43.5%|
|_________________|__________|_______________|__________|_____________|
|EBITDA1 | $27,149| $(141,760)| $(13,975)| $(290,336)|
|_________________|__________|_______________|__________|_____________|
|Operating income | | | | | |(loss) | $5,210| $(178,929)|
$(64,386)| $(382,400)|
|_________________|__________|_______________|__________|_____________|
|Net income (loss)| $15,312| $(149,901)| $(78,248)| $(307,880)|
|_________________|__________|_______________|__________|_____________|
|Basic and diluted| | | | | |loss per share | $0.00| $(0.01)|
$0.00| $(0.02)|
|_________________|__________|_______________|__________|_____________|
1 Earnings before interest, taxes, depreciation and amortization
("EBITDA") should not be considered as a substitute for net loss
determined in accordance with IFRS. A reconciliation of EBITDA to
net loss is detailed in a separate section. EBITDA is a standard
used in the telecommunications industry to assist in understanding
and comparing operating results. The Company believes that EBITDA
is a useful measure of the Company's ability to service debt,
invest in capital equipment or distribute dividends to its
shareholders. Revenue decreased by 9.9% to $2.4 million in the
second quarter of 2012 compared to $2.7 million in 2011. This
decrease was driven by declines mainly in lower margin and credit
challenged wholesale services. Retail revenues declined 4.4% as a
result of increased credit requirements for new customers along
with decrease in subscription services. To combat this
decline the Company has repriced its home phone offering in August
to a much simpler three tier plan offering unlimited calling.
Subscription revenue and the launch of the new #100 mobile phone
calling services will be the driving force for next quarter's
earnings with simple product choices and features, price plans and
marketing initiatives geared towards subscriber retention and cross
promotion. The increase in gross margin was primarily due to a
decline in wholesale revenue coupled with decreased
telecommunication costs related to the new switch implementation. A
complete financial reporting package, including the 2011 Audited
Annual Consolidated Financial Statements and Notes to the Financial
Statements and MD&A, is available at our corporate website
(www.telehop.com), at SEDAR website www.sedar.com or via email to
investorinquiry@telehop.com or via phone at 416-494-4490.
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS Certain statements
contained herein regarding the Company and its plans constitute
"forward-looking statements" within the meaning of Canadian
securities laws. By their nature, forward-looking statements
require the Company to make assumptions and are subject to inherent
risks and uncertainties. The forward-looking statements
involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of
the Company to be materially different from any performance or
achievement expressed or implied by such forward-looking
statements. We direct you to our Company's Management's
Discussion and Analysis filed for the period ended December 31,
2011. Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release. ____________________________ About
Telehop Telehop Communications Inc. , was founded and headquartered
in Toronto, Ontario, in 1993, and has grown into one of the largest
alternative telecommunications providers to both residential and
business customers. Telehop originally began offering residential
and business two-way monthly 'flat rate' calling services in the
Greater Toronto area between communities where a call would
otherwise be a long distance call. In 1994, Telehop became one of
Canada's few Equal Access Long Distance Providers, allowing it to
offer its customers full service long distance calling globally at
significantly lower rates. The Canadian Radio-television and
Telecommunications Commission ("CRTC") has licensed Telehop as a
Class "A" telecommunications carrier. Telehop's dedication
and priority is providing residential and businesses with
exceptional phone services at competitive rates without sacrificing
quality service. Telehop Communications Inc. CONTACT: Mr. Rajiv
JagotaPresident and CEO(416) 494 4490rjagota@telehop.com
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