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Tellza Announces 2017 Q2 Financial Results

Q2 YTD Net Income was US$ 0.08 per share

/ -- TORONTO, ONTARIO--(Marketwired - Jul 21, 2017) - Tellza Communications Inc. (TSX:TEL) announced its unaudited financial results for the quarter ended June 30, 2017. All dollar and per share amounts referred to herein are in United States funds, unless expressly stated otherwise.

2017 Highlights

  • Revenue was $385 Million compared to $202 Million in 2016.
  • Q2 - YTD EBITDA* was $1.9 Million or $0.18/share (2016 - $1.0 Million or $0.09/share)
  • Q2 - YTD Net Income attributable to shareholders was $0.8 Million or $0.08/share (2016 - $0.1 Million or $0.01/share.

Portfolio Investments

  • Rightway Funding Group LLC made distributions of $1.2 Million in 2017 ($0.7 Million in Q2) of which $0.4 Million ($0.2 Million in Q2) was for the benefit of Tellza. In 2016, Rightway earned $2.0 Million; of which $1.1 Million was earned during Tellza's ownership. Tellza in 2016 received $0.5 Million in distributions which were assigned to the vendor non-recourse debt as payments toward the notes. Since this investment in April 2016, Tellza has received $0.9 Million in distributions.

  • Next Group Holdings Inc. (OTC:NXGH) trading value increased in 2017, resulting in an increase in the book value of this investment on Tellza's books in 2017 of $0.2 Million. Tellza acquired 13 Million shares upon the disposition of certain operations in 2016. In 2016, Tellza recognized a gain on sales of assets of $1.1 Million followed by a $1.8 Million unrealized market loss on its holdings of NXGH. In 2017, Tellza received an additional 4 million shares pursuant to the terms of the original sale transaction which required the purchaser to deliver additional shares to Tellza if NXGH shares did not achieve certain agreed upon trading price levels by January 2017. The Company will continue through its statement of operations to mark to market the changes in trading value of these securities at each reporting date.

Corporate Governance

  • To further board independence, Tellza has appointed Huseyin Kizanlikli, a seasoned international business operator, to be Independent Chairman of Tellza'a board. Mr. Kizanlikli succeeds Gary Clifford, who served as non-independent Chairman since 2010. Gary shall continue to serve as a director of Tellza.

  • Tellza has also appointed Jonathan Martin to serve as Chair of the Audit Committee. Mr. Martin succeeds Salil Munjal, who has held the position since 2010. Salil shall continue to serve as a director of Tellza.

While we conduct our business primarily in USD and report our financial results in USD, our common shares are listed and trade on the Toronto Stock Exchange in CDN dollars. Expressed in CDN dollars, Q2YTD EBITDA* was CDN$2.5 Million or CDN$0.24/share compared to CDN$1.3 Million or CDN$0.11/share in Q2YTD 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 operates in both the Communications and Financial Support Services business. 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.

*We define EBITDA as earnings before taxes, depreciation and amortization, impairments, stock based compensation, interest, minority interest and other gains and losses. 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:

For the three and six months ended, June 30, 2017 2016 2017 2016
Net income and comprehensive income for the period $ 316 $ 164 $ 938 $ 218
Provision for income taxes $ - $ 50 $ 250 $ 150
Depreciation of property and equipment $ 125 $ 127 $ 255 $ 251
Amortization of intangible assets $ 156 $ 130 $ 312 $ 330
Gain on the sale of Tel 3 and Accounts Receivables $ - $ (1,093) $ - $ (1,093)
Unrealized (Gain)/Loss on mark to market of Securities $ - $ 1,000 $ (170) $ 1,000
Amortization of intangible assets of associate $ 73 $ 90 $ 145 $ 90
Imputed interest on non-recourse debt of subsidiary $ 116 $ 43 $ 237 $ 43
Non-controlling interest $ (28) $ (48) $ (91) $ (73)
Interest and debt costs $ 38 $ 42 $ 65 $ 69
EBITDA $ 796 $ 505 $ 1,941 $ 985
EBITDA per share in USD $ 0.07 $ 0.04 $ 0.18 $ 0.09

Tellza Communications Inc.
Gary Clifford
+647 281 1831

Distribution channels: IT Industry

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