Glentel Inc. reports record 1st quarter earnings of $0.22 per share



    BURNABY, BC, May 5 /CNW/ - Glentel Inc. (TSX: GLN) today reported its
results for the 1st quarter ended March 31, 2009.

    Financial highlights, tabular amounts in thousands of Canadian dollars
(except per share data), are:
    
    -------------------------------------------------------------------------
                                     Three Months Ended   Three Months Ended
                                       March 31, 2009       March 31, 2008
    -------------------------------------------------------------------------
    Sales                                   $67,444              $50,718
    -------------------------------------------------------------------------
    Income, before interest,
     taxes and amortization                  $5,006               $1,994
    -------------------------------------------------------------------------
    Operating income, before
     interest and taxes                      $3,513                 $397
    -------------------------------------------------------------------------
    Net income                               $2,416                 $257
    -------------------------------------------------------------------------
    Basic net income per share                $0.22                $0.02
    -------------------------------------------------------------------------
    Diluted net income per share              $0.22                $0.02
    -------------------------------------------------------------------------
    

    Consolidated sales for the three months ended March 31, 2009 grew 33%, to
$67,444,000 compared to $50,718,000 in the same period of 2008. Operating
income before interest and taxes increased to $3,513,000 for the 1st quarter
of 2009 compared to $397,000 in 2008. Net income for the quarter increased to
$2,416,000, $0.22 per share, compared to $257,000, $0.02 per share, for the
quarter in 2008.
    Retail Division sales of mobile phone products and services grew 40%, to
$57,823,000 for the 1st quarter compared to $41,365,000 for the 1st quarter of
2008. Sales were strengthened in the quarter due to the success of smartphone
technology which carried over from the previous two quarters. In addition,
industry trends have pointed to the fact that higher-end multimedia devices
have become drivers for post-paid activations. Growth in sales was also due to
the division operating 252 stores during the 1st quarter in 2009 (11% growth
over the prior year) compared to 227 stores in the same period of 2008. In
addition, same-store activations of mobile phones and other wireless devices
sold in the Retail Division grew 26% in the 1st quarter of 2009 over the
corresponding period in 2008 for stores that were open throughout both
periods.
    During the quarter, the Retail Division expanded its distribution base by
opening four new stores: three in WirelessWave and one in Tbooth / la cabine
T. The division currently operates 111 WirelessWave mall-based stores and
retail locations, 69 Tbooth / la cabine T mall-based stores, and 72 WIRELESS
etc. stores in Costco Wholesale in Canada.
    Operating income before interest and taxes in the Retail Division
increased to $7,026,000 in the 1st quarter compared to $2,850,000 in the
previous year.
    Business Division sales of terrestrial narrowband and broadband radio
systems, satellite network services, and implementation services increased 3%,
to $9,621,000 for the 1st quarter compared to $9,353,000 in the 1st quarter of
2008. However, gross margins were reduced by 5% points as the division has
been significantly impacted by the economic slowdown. Operating expenses for
the 1st quarter remained flat at $2,749,000 in 2009 compared to $2,711,000 in
2008.
    As a result, operating income before interest and taxes for the quarter
in the Business Division was a loss of $93,000 compared to income of $221,000
in 2008.
    Corporate operating expenses for the 1st quarter of 2009 increased to
$3,267,000 (4.8% of sales) compared to $2,531,000 (5.0% of sales) in the 1st
quarter of 2008. The majority of this increase was for incremental
professional services fees (approximately $475,000) that the Company incurred
in its unsuccessful bid to acquire a national Canadian consumer electronics
chain of 750 stores currently under court protection.
    "We are very excited about these financial results in a quarter that is
seasonally our weakest quarter of the year," said Thomas Skidmore, Glentel's
President and Chief Executive Officer. "The investment we continue to make in
professional training, coupled with a smart phone multi-media marketing focus,
has yielded a superb financial result in the midst of a soft economy and lack
of consumer confidence." Mr. Skidmore continued, "Given the current economic
conditions, we continue to be cautiously optimistic of our prospects in 2009."

    About Glentel:

    Glentel (TSX: GLN) is a leading provider of innovative and reliable
telecommunications services and solutions in Canada and the United States.
Founded in 1963 and headquartered in Burnaby, B.C., Glentel comprises two
operating divisions - Retail and Business - that service thousands of
consumers and commercial telecommunications customers. Together with its
divisions, the company boasts more than 265 locations across Canada located in
retail malls, retail locations, Costco Wholesale stores, and business centers.
As the largest multi-carrier mobile phone retailer in Canada, it offers a
choice of network carrier and wireless device or phone. To its business and
government customers, Glentel offers wireless service, rental equipment,
satellite and terrestrial network systems, tower sites, and wireless asset
monitoring. Glentel operates its business under the trading names Glentel
Wireless, WirelessWave, The Telephone Booth (Tbooth and la cabine T) and
WIRELESS etc.

    Forward-Looking Statements:

    Statements in this release relating to matters that are not historical
fact are forward-looking statements based on current expectations, forecasts
and assumptions that involve risks and uncertainties that could cause actual
outcomes and results to differ materially. Factors that could cause or
contribute to such differences include, but are not limited to, general
economic conditions, changes in technology, reliance on third-party
manufacturing, managing rapid growth, limited intellectual property
protection, and other risks and uncertainties described in Glentel's public
filings with securities regulatory authorities.

    
    NO STOCK EXCHANGE, SECURITIES COMMISSION, OR OTHER REGULATORY AUTHORITY
    HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.
    

    To secure a copy of Glentel's annual report or for additional information
visit www.glentel.com or www.sedar.com.




For further information:

For further information: Investor Relations Contact: Dale B. Belsher,
Chief Financial Officer, Glentel Inc., (604) 415-6500, investors@glentel.com;
Media Contact: Kristin Treat, VP, James Hoggan & Associates, (604) 761-9946
mobile, ktreat@hoggan.com

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