Prestige Telecom strong growth continues in its second quarter



    
    - Sales growth of 69.3% over last year to $9.7 million
    - Q2 EBITDA margin of 6.5%, up from 6.2% in Q1 and 2.6% last year
    - Net loss of $96,308, versus a net loss of $63,435 a year earlier
    

    MONTREAL, Nov. 23 /CNW Telbec/ - Prestige Telecom Inc. ("Prestige" or the
"Company") (TSX Venture: PR.V) a leading provider of engineering, materials
furnishing and installation (EF&I) services for the Canadian
telecommunications industry, today reported its second-quarter and six-month
results for the period ended September 30, 2007. This is the first quarterly
financial report since the Company's going-public transaction on July 30,
2007.
    Sales increased by $4.0 million, or 69.3%, to $9.7 million. Internal
growth exceeded 50% year-over-year while Plantec Inc., acquired in June 2007,
contributed sales of approximately $1.0 million to the quarter. EBITDA
(earnings before interest, taxes, depreciation, amortization, stock-based
compensation and foreign exchange) reached $629,850 compared with $145,967 for
the same period last year. The EBITDA margin stood at 6.5%, up significantly
from 2.6% a year ago and up sequentially from 6.2% in the previous quarter.
Prestige recorded a net loss of $96,308 compared with a loss of $63,435 in the
same period last year. This resulted primarily from higher interest expenses
following Prestige's recent expansion as well as non-recurring expenses
related to the going-public transaction and subsequent financing, of which a
portion is of a non-cash nature.
    For the six-month period ended September 30, 2007, Prestige recorded
sales of $18.3 million, representing an increase of 71.9% over the same period
a year prior. EBITDA was $1.2 million, or 6.4% of sales, up sharply from
$255,751, or 2.4% of sales for the six months ended September 30, 2006. Net
loss for the first half was $2,251 compared with a net loss of $131,173 for
the corresponding period last year.

    
    -------------------------------------------------------------------------
    Financial Highlights
    (in '000s of $, except    Three months ended          Six months ended
     per share data)             September 30,              September 30,
    -------------------------------------------------------------------------
                              2007          2006          2007          2006
    -------------------------------------------------------------------------
    Sales                    9,691         5,724        18,283        10,634
    Gross margin              25.7%         20.7%         24.1%         20.6%
    EBITDA margin              6.5%          2.6%          6.4%          2.4%
    Net earnings (loss)        (96)          (63)           (2)         (131)
    Per share - basic and
     diluted ($)             (0.00)        (0.00)        (0.00)        (0.01)
    Weighted-avg. shares
     outstanding (basic,
     in '000s)              38,049        23,768        31,008        23,768
    -------------------------------------------------------------------------


    "We are pleased with our results that show strong internal growth and
further improvement in operating profitability," said Brian McFadden,
President and Chief Operating Officer of Prestige Telecom. "All aspects of our
business experienced solid growth. In addition, the acquisition of Plantec and
Keen Communication Services, which concluded subsequent to the end of the
quarter on October 22, 2007, are broadening our national geographical
footprint and our service offerings."
    During the second quarter, engineering services grew by 89.6% to reach
$4.8 million. Material furnishing operations generated sales of $2.6 million,
representing an increase of 80.3%, while installation services accounted for
sales of $2.3 million, 30.8% higher than a year ago. For the six-month period,
engineering services more than doubled to $8.8 million. Material furnishing
services grew 69.3% to $5.5 million and installation services grew 30.9% to
reach $4.0 million.
    On July 30, 2007, Prestige completed its going-public transaction and, in
connection with this transaction, successfully completed a private placement
for gross proceeds of $5.5 million. Following these events, the total number
of shares outstanding is now 46.1 million.
    "Prestige is on track to meet its operating objectives, and market
conditions remain favourable to the execution of our plan. Moreover, our
agreement with RAMTeCH Software Solutions, a provider of Computer Assisted
Design support services, should enable Prestige to reduce costs and increase
the throughput of its design services to customers. We will continue to
diligently execute our business strategy in order to benefit from increased
outsourcing of EF&I services and greater capital spending by telecommunication
companies. The industry is very fragmented and we intend to be an active
consolidator, as we aim to further strengthen our leading position in Canada,"
concluded Mr. McFadden.

    ABOUT PRESTIGE TELECOM INC.

    Prestige Telecom is a leading provider of network engineering, materials
furnishing, installation and support services (commonly referred to as EF&I
services) required to construct, operate and maintain wireline, wireless and
cable television networks. Prestige Telecom assists telecommunications
original equipment manufacturers ("OEM") and service providers to engineer,
install and upgrade their infrastructures to support enhanced voice, high
speed data and video services.
    In Canada, Prestige Telecom operates from three full service locations
based in Montreal, Quebec; Toronto, Ontario and Calgary, Alberta and has
350 professional and technical personnel. Prestige Telecom operates in the
United States market through a mutual subcontractor agreement with Comforce
Telecom Inc. under the trade name Prestige Comforce Professional Services
("PCPS"). PCPS is based in Plano, Texas and provides services to customers
throughout the United States.

    FORWARD-LOOKING STATEMENTS

    This press release contains certain forward-looking statements with
respect to the Company. Such forward-looking statements are dependent upon a
certain number of factors and are subject to risks and uncertainties. Actual
results may differ from those expected. The information contained in this
press release is dated November 22, 2007, the date on which the Directors
approved the press release. Management does not assume any obligation to
update or revise any forward-looking statements, whether as a result of new
information or future events, except when required by the regulatory
authorities.

    Note to readers: Complete unaudited consolidated financial statements and
Management's Discussion & Analysis of Financial Position and Operating Results
were posted on SEDAR and are available at www.sedar.com.

    The TSX Venture Exchange accepts no responsibility for the adequacy or
    the accuracy of this press release.


    CONSOLIDATED STATEMENT OF EARNINGS
    (UNAUDITED)
    -------------------------------------------------------------------------
                              Three Months                 Six Months
                           Ended September 30          Ended September 30
                       --------------------------  --------------------------
                              2007          2006          2007          2006
                       --------------------------  --------------------------
    SALES              $ 9,690,794   $ 5,723,573   $18,283,192   $10,634,156
    COST OF SALES        7,202,244     4,537,797    13,866,167     8,439,144
                       ------------  ------------  ------------  ------------
    GROSS PROFIT         2,488,550     1,185,776     4,417,025     2,195,012
    OPERATING EXPENSES   1,858,700     1,039,809     3,251,764     1,939,241
                       ------------  ------------  ------------  ------------
    EBITDA                 629,850       145,967     1,165,261       255,771
      Depreciation and
       amortization        256,968        69,456       427,531       137,823
      Interest on long
       term debt           292,003        16,267       401,095        38,158
      Foreign exchange     (14,440)        4,279       (32,394)      (14,004)
      Other interest       136,949       137,291       290,527       261,963
      Issuance of
       shares to a
       lender              100,000             0       100,000             0
                       ------------  ------------  ------------  ------------
    LOSS BEFORE
     INCOME TAXES         (141,630)      (81,326)      (21,498)     (168,169)
    INCOME TAX
     RECOVERY              (45,322)      (17,891)      (19,247)      (36,996)
                       ------------  ------------  ------------  ------------
    NET LOSS           $   (96,308)  $   (63,435)  $    (2,251)  $  (131,173)
                       ------------  ------------  ------------  ------------
                       ------------  ------------  ------------  ------------
    BASIC AND DILUTED
     LOSS PER SHARE    $     (0.00)  $     (0.00)  $     (0.00)  $     (0.01)
                       ------------  ------------  ------------  ------------
                       ------------  ------------  ------------  ------------
    WEIGHTED AVERAGE
     NUMBER OF
     COMMON SHARES
     OUTSTANDING        38,048,719    23,767,748    31,007,563    23,767,748
                       ------------  ------------  ------------  ------------
                       ------------  ------------  ------------  ------------


    CONSOLIDATED BALANCE SHEET
    (UNAUDITED)
    -------------------------------------------------------------------------
                                                   As at               As at
                                     September  30, 2007      March 31, 2007
                                              (Unaudited)           (Audited)
                                     ----------------------------------------
    CURRENT ASSETS
      Accounts receivable                 $    6,601,427       $   4,343,997
      Inventories                              5,406,318           4,465,742
      Prepaid expenses                           373,488             501,653
                                          ---------------     ---------------
                                              12,381,233           9,311,392
    DEFERRED CHARGES                           1,176,816             594,987
    PROPERTY AND EQUIPMENT                     2,214,002           1,852,229
    GOODWILL                                   1,866,016             578,166
    FUTURE INCOME TAXES                           36,222                   0
                                          ---------------     ---------------
                                          $   17,674,289       $  12,336,774
                                          ---------------     ---------------
                                          ---------------     ---------------
    CURRENT LIABILITIES
      Bank indebtedness                   $    3,665,231       $   4,139,573
      Accounts payable and
       accrued liabilities                     3,271,721           3,438,841
      Current portion of
       long-term debt                          1,247,921           1,193,415
                                          ---------------     ---------------
                                               8,184,873           8,771,829

    LONG-TERM DEBT                             5,669,997           3,971,950
    DEFERRED GAIN ON SALE OF
     PROPERTY                                    362,626             385,529
    FUTURE INCOME TAXES                                0              34,906
                                          ---------------     ---------------
                                              14,217,496          13,164,214
                                          ---------------     ---------------

    SHAREHOLDERS' EQUITY (DEFICIENCY)
      Capital stock                            5,089,739           1,000,106
      Deficit                                 (2,634,797)         (2,632,546)
      Contributed surplus                        481,851             285,000
      Equity component of
       convertible loan                          520,000             520,000
                                          ---------------     ---------------
                                               3,456,793            (827,440)
                                          ---------------     ---------------
                                          $   17,674,289       $  12,336,774
                                          ---------------     ---------------
                                          ---------------     ---------------
    




For further information:

For further information: Prestige Telecom Inc.: Brian McFadden,
President and Chief Operating Officer, (514) 457-4488, Ext. 263,
bmcfadden@prestige-tel.com; MaisonBrison: Martin Goulet, CFA, (514) 731-0000,
martin@maisonbrison.com; From: Prestige Telecom Inc.

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