Telehop Announces Positive Third Quarter Results September 30, 2013

Telehop Communications Inc. (“Telehop” or the “Company”), (TSX-V: HOP) today announced its financial performance during the third quarter ended September 30, 2013.

Telehop has continued to deliver positive net income and EBITDA by focusing on cost efficiencies of the core business and with the launch of the new Telehop Business Services.

“Our expansion into new markets like Telehop Business Services is now starting to pay off. We will continue to find new products and markets to expand into, that will offset declines in traditional dial around,” said Rajiv Jagota, President CEO, Telehop.

During the third quarter, Telehop saw EBITDA rise to $103,511 from $77,131 during the same period last year. Operating income grew to $59,946 from $52,850 a year ago. Year to date EBITDA is $269,983 and operating income is $133,774.

Company highlights during the third quarter include:

  • Expansion of our new Telehop Business Services and integration into full operations of the company.
  • Development of agents and resellers of Telehop Business Services
  • Expansion of online marketing initiatives focused on the residential market.

FINANCIAL OVERVIEW

Consolidated HighlightsThree months ended

September 30

Nine months ended

September 30

2013201220132012
Revenue $2,134,518 $2,095,027 $6,313,837 $6,932,829
Gross margin $901,810 $984,063 $2,693,742 $3,107,223
Gross margin % 42.3% 47.0% 42.7% 44.8%
EBITDA1 $103,511 $77,131 $269,983 $63,156
Operating income (loss) $59,946 $52,850 $153,222 $(11,535)
Net income (loss) $51,155 $38,518 $133,774 $(39,729)
Earnings (loss) per share - basic $0.002 $0.002 $0.006 $(0.002)


1 We define EBITDA as earnings before interest costs, taxes, depreciation and amortization. EBITDA, which is a non-GAAP financial measure, 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 such measures may differ among companies and analysts. Below is a reconciliation of “EBITDA” to net income (loss) for the periods presented:

EBITDA ReconciliationThree months ended

September 30

Nine months ended

September 30

2013201220132012
Net income $51,155 $38,518 $133,774 $(39,729)
Interest costs 8,791 14,346 26,719 32,392
Income taxes - - - -
Amortization 43,565 24,267 109,490 70,493
EBITDA1 103,511 77,131 269,983 63,156

A complete financial reporting package, including the September 30, 2013 Interim Consolidated Financial Statements and Notes to the Financial Statements and MD&A, is available at our corporate website (www.telehop.com), at SEDAR website (www.sedar.com) or via email to investorinquiry@telehop.com or via phone at 416-494-4490.

DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained herein regarding the Company and its plans constitute “forward-looking statements” within the meaning of Canadian securities laws. By their nature, forward-looking statements require the Company to make assumptions and are subject to inherent risks and uncertainties. The forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any performance or achievement expressed or implied by such forward-looking statements. We direct you to our Company’s Management’s Discussion and Analysis filed for the period ended September 30, 2013.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

____________________________

About Telehop

Telehop Communications Inc. (TSX-V: HOP) was founded and headquartered in Toronto, Ontario in 1993, and has grown into one of the largest alternative telecommunications providers to both residential and business customers.

Telehop originally began offering residential and business two-way monthly 'flat rate' calling services in the Greater Toronto area between communities where a call would otherwise be a long distance call. In 1994, Telehop became one of Canada's few Equal Access Long Distance Providers, allowing it to offer its customers full service long distance calling globally at significantly lower rates. The Canadian Radio-television and Telecommunications Commission ("CRTC") has licensed Telehop as a Class "A" telecommunications carrier.

Telehop's dedication and priority is providing residential and businesses with exceptional phone services at competitive rates without sacrificing quality service.

Contacts:

Telehop Communications Inc.
Mr. Rajiv Jagota, 416-494-4490
President and CEO
rjagota@telehop.com

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