CST: 04/12/2016 20:30:41   

Tellza Announces 2015 Financial Results

251 Days ago

Revenue US$306 Million, Up 25% From 2014; Five Years of Consecutive Profit

TORONTO, ONTARIO--(Marketwired - Mar 28, 2016) - Tellza Communications Inc. (TSX:TEL) announced its audited financial results for 2015.

Revenue for 2015 was USD$306 Million compared to USD$243 Million in 2014 an increase of USD$63 Million or 26% year over year. EBITDA* was USD$2.8 Million compared to USD$2.9 Million in 2014. While we conduct our business primarily in USD, we are based in Canada and our common shares are listed and traded on the Toronto Stock Exchange in CDN dollars. Reporting in CDN dollars, our EBITDA* is CDN$3.8 Million for 2015 compared to CDN$3.3 Million in 2014. Net Income was USD$0.34 Million compared to net income of USD$1.0 Million in 2014. The decrease in Net Income is primarily related to increase in non-cash impairment of the underperforming Tel3 business unit.

Tellza has grown its revenue from USD$121 Million in 2011 to USD$306 Million in 2015, an increase of USD$185 Million over five years. During this period, Tellza earned USD$15.5 Million of EBITDA* and USD$9.4 Million of Net Income. Tellza produced USD$13.7 Million in cash flow from operations over this five year period, including USD$2.4 Million in 2015. Tellza invested a net USD$3.9 Million in working capital; including USD$6.0 Million in 2015. Tellza has also invested USD$3.2 Million in next generation networks and enterprise wide systems to automate traffic, transactions and workflows end to end, while investing another USD$3.0 Million in technology rights and know how to allow it to remain competitive as margins reduced in its business/industry segment. Tellza has also ensured that its growth has come within its means by: 1) nearly doubling its shareholders equity over the last five years, 2) deleveraging the Company by becoming debt free and 3) ensuring it has adequate liquidity in the form of a CDN$6.5 Million unused credit facility as at the end of 2015.

(000's USD) 2011-12-31 2012-12-31 2013-12-31 2014-12-31 2015-12-31 5 Yr Cum.
Cash $ 31 $ 2,288 $ 2,990 $ 6,486 $ 1,425 $ 1,394
Total current assets $ 8,212 $ 9,900 $ 15,897 $ 24,937 $ 40,456 $ 32,244
Total assets $ 20,882 $ 21,793 $ 33,180 $ 43,016 $ 57,421 $ 36,539
Working capital $ (2,789) $ (482) $ 529 $ 278 $ 1,192 $ 3,981
non-cash working capital $ (2,820) $ (2,770) $ (2,461) $ (6,208) $ (233) $ 2,587
Debt $ 1,277 $ - $ - $ - $ - $ (1,277)
Shareholders Equity $ 9,067 $ 11,156 $ 17,577 $ 17,876 $ 17,541 $ 8,474
Shareholders Equity per share $ 0.05 $ 0.07 $ 0.10 $ 0.11 $ 0.10 $ 0.05
Revenue $ 120,835 $ 102,896 $ 155,506 $ 242,779 $ 305,941 $ 185,106
EBITDA* $ 2,536 $ 3,244 $ 3,964 $ 2,965 $ 2,836 $ 15,545
Non-cash items $ (604) $ 763 $ 695 $ 1,579 $ 2,290 $ 4,723
Net Income $ 3,376 $ 2,382 $ 2,360 $ 966 $ 344 $ 9,428
Cash from Operations $ 1,772 $ 3,081 $ 3,712 $ 2,665 $ 2,434 $ 13,664
(Investment in)/Reduction from Working capital $ (841) $ 893 $ (1,242) $ 3,296 $ (6,006) $ (3,900)
Investment in CAPEX $ (165) $ (321) $ (860) $ (1,057) $ (810) $ (3,213)
Financing Activities $ (2,519) $ (1,395) $ (908) $ (1,408) $ (679) $ (6,909)

"Tellza operates in the nearly free market for telephone calls. Our investments in systems has allowed us to remain profitable, while many of our competitors have commenced exiting the business. As this commodity matures, we expect to see sustained business with improved margins as we move forward" said Gary Clifford, Executive Chairman. "We are proud to have achieved five years of profitable growth and are aiming for greater achievements in 2016."

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 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 seeks portfolio investment opportunities in various market places. 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:

EBITDA (USD '000's) 2011-12-31 2012-12-31 2013-12-31 2014-12-31 2015-12-31 5 Yr Cum.
Net Income $ 3,376 $ 2,382 $ 2,360 $ 966 $ 344 $ 9,428
Income taxes $ (574) $ (61) $ 876 $ 392 $ 81 $ 714
Depreciation of property and equipment $ 517 $ 120 $ 127 $ 298 $ 405 $ 1,467
Amortization of intangible assets $ 1,056 $ 850 $ 556 $ 1,281 $ 969 $ 4,712
Impairment of Goodwill $ - $ - $ - $ - $ 916 $ 916
Stock-based compensation $ 113 $ 53 $ 12 $ - $ - $ 178
Other non-cash gain $ (2,290) $ (260) $ - $ - $ - $ (2,550)
Interest and debt costs $ 338 $ 160 $ 33 $ 28 $ 121 $ 680
$ 2,536 $ 3,244 $ 3,964 $ 2,965 $ 2,836 $ 15,545

Gary Clifford
Tellza Communications Inc.
Executive Chairman
+647 281 1831
gclifford@tellza.com
Michael Vazquez
Tellza Communications Inc.
Chief Executive Officer
+954-608-5058
mike@tellza.com