Prestige Telecom reports record sales and strengthened balance sheet in the third quarter of fiscal 2009


    BAIE D'URFE, QC, Feb. 27 /CNW Telbec/ - Prestige Telecom Inc. ("Prestige"
or "the Company") (TSX-V:PR) today announced unaudited financial results for
the third quarter of fiscal 2009, which ended December 31, 2008, and filed its
MD&A for the period. All figures are in Canadian dollars.
    Revenues for the third quarter were $15.5 million, an increase of 55%
over the third quarter of last year, and a sequential increase of 10% compared
to the quarter ended September 30, 2008. The record level of revenues in the
third quarter included a contribution of $1.7 million from Radian
Communications Services (Canada) Limited ("Radian") for the two weeks after
its acquisition became effective, which was December 15, 2008.
    In the third quarter, EBITDA(1) was a loss of $0.3 million, a decrease of
$0.6 million versus the same period last year, and a decrease of $0.7 million
from the second quarter. The favorable impact of the higher sales volume was
more than offset by a reduction in gross margin as well as higher overhead
costs. The margin decline was due to continuing costs to improve labour
productivity, and an increased volume of offshore contracts, which generate
lower margins. General and administrative expenses increased by $0.3 million
over the previous quarter and included two weeks of Radian overhead costs as
well as several expenses which are not expected to recur including a
write-down of a Nortel receivable and costs for exiting a business partnership
in the U.S. These increases were partially offset by savings, as expected,
from the downsizing of head office administrative staff which was announced on
August 29, 2008. Net loss for the quarter was $1.9 million, or a loss of $0.03
per share, compared to a net loss of $0.2 million, or a loss of $0.01 per
share, a year ago, and a net loss of $0.4 million or a loss of $0.01 per share
in the second quarter.
    Prestige noted that its balance sheet significantly strengthened during
the quarter with the proceeds from the private placement financings completed
to fund the Radian acquisition and build working capital. At December 31, 2008
Prestige had working capital of $10.1 million, total assets of $55.5 million,
shareholders' equity of $22.2 million, short term debt of $7.5 million
including letters of credit in a newly established $17 million credit facility
with the Canadian Imperial Bank of Commerce. There were 118,159,568 million
shares outstanding.
    Mr. Pierre Yves Méthot, Chairman and CEO of Prestige, said, "Now that the
Radian acquisition has been completed, we are looking forward to building on
our third quarter in a row of record revenue and focusing all of our energy on
managing our business to wireline, wireless, cable and OEM customers across
Canada. Our newly recapitalized balance sheet provides the strong working
capital position that will enable us to make the necessary investments to
successfully integrate the two companies to drive revenue and margin growth
and profitability."
    Revenues for the nine months ended December 31, 2008 were $41.3 million,
an increase of 45% over the same period last year. For the nine month period,
EBITDA declined to $0.7 million from $1.5 million. The EBITDA decline
reflected a decline in gross margin from 23.9% last year to 21.1% this year,
and increased costs associated with acquisitions. Net loss of $3.7 million, or
a loss of $0.07 per share, for the nine months to December 31 2008 included
transaction and reorganization costs of a one-time nature of $2.1 million
associated with the uncompleted WesTower transaction and one-time severance
costs, most of which were recorded in the first quarter of the fiscal year.
    The Company noted that integrated teams are working on the following
initiatives to integrate the two companies and to increase efficiencies and
financial performance. A comprehensive purchasing review has begun to evaluate
global purchasing, with many cost savings initiatives already identified,
particularly now that Prestige's working capital position has improved. All
businesses and corporate functions are being examined to identify best
practices and opportunities for streamlining operations. IT integration to a
common platform is expected to take nine to twelve months. In addition, many
significant incremental sales opportunities are being actively pursued.
    Mr. Méthot concluded, "Looking forward, as a $100+ million company
operating on a national basis, we clearly need to demonstrate that we can
profitably take advantage of the rapid expansion and upgrading of our
customers' networks, and the growing trend to increased outsourcing of
infrastructure services by our customers. We welcome the support of key new
financial and strategic shareholders, and we look forward to reporting on our

    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 and service providers to engineer, install
and upgrade their infrastructures to support enhanced voice, high speed data
and video services. Prestige Telecom also provides technical and aerial
services to the Canadian communications and broadcast industries, including
tower engineering, site construction, and infrastructure and equipment
    In Canada, Prestige Telecom has over 700 professional and technical
personnel operating from fifteen service locations based in Montreal and
St-Hubert, Québec; Mississauga, Markham and Oakville, Ontario, Surrey and
Langley, British Columbia, Calgary, Edmonton and Nisku Alberta, St-Paul,
Manitoba, Saskatoon, Saskatchewan, Bedford and Truro, Nova Scotia, and
St-John, New Brunswick.

    (1) Earnings before interest, taxes, depreciation and amortization,
    stock-based compensation, loss on disposal of property, plant and
    equipment, foreign exchange, transaction and reorganization costs.

    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 February 25, 2009, 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

    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

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

For further information:

For further information: Pierre Yves Méthot, Chairman and Chief
Executive Officer, Prestige Telecom Inc., (514) 457-4488, Ext. 277,; Source: Prestige Telecom Inc.

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