XFONE Reports
First Quarter 2006 Results Profitable Growth Continues;
Reiterates 2006 Revenue Guidance of US$36-$38 Million.
Conference Call Scheduled for Tuesday, March 16 at 9:15 AM
ET
May 15, 2006
JACKSON, Miss., May 15 /PRNewswire-FirstCall/ -- XFONE, Inc. (Amex: XFN) ("XFONE"
or "the Company"), a provider of international voice and data
communications services, announces its first quarter results for the three
months ended March 31, 2006.
Financial Highlights for the Three Months Ended March 31, 2006 Compared to the
Three Months Ended March 31, 2005:
- Revenues increased 36% to 4,501,289
pounds(US$7,841,245) from
3,312,934 pounds (US$6,228,317).
- Gross profit margins improved, rising to 36.3%
from 31.4%.
- Operating profits jumped 647% to 85,296 pounds
(US$148,585) from 11,415
pounds (US$21,461).
- Net income rose 47% to 63,889 pounds(US$111,295)
from 43,497 pounds
(US$81,774).
- Basic earnings per share were 0.008
pounds(US$0.014) compared to 0.007
pounds (US$0.012).
- As of March 31, 2006, the Company had
approximately 5.0 million pounds
(US$8.7 million) in cash and accounts receivables
and stockholders'
equity of approximately 8.5 million pounds (US$14.7
million).
- The Company's Israeli "start up"
subsidiary, XFONE 018 Ltd., achieved a
breakeven EBITDA. Revenues in XFONE 018 Ltd
increased 228% to 650,069
pounds (US$1,132,420) for the quarter ended March
31, 2006 compared to
198,211 pounds (US$372,637) for the first quarter of
2005.
Operational Highlights for the First Quarter 2006:
- In January 2006, XFONE USA completed the
acquisition of the assets of
EBI Comm, Inc. and Canufly.net, Inc., both Internet
Service Providers
serving customers throughout the Mississippi.
Collectively, both
acquisitions are expected to contribute over US$1
million in revenues
to XFONE in 2006.
- On March 31, 2006, the Company completed the
mergers of I-55 Internet
Services, Inc. and I-55 Telecommunications, LLC,
with and into its
wholly owned subsidiary XFONE USA, Inc.
- Guy Nissenson, President and CEO of XFONE, Inc.,
issued formal annual
revenue guidance, forecasting $36-$38 million for
2006.
"2006 is off to a very strong start in all regards," stated Nissenson.
"We continue to enjoy double and triple digit growth across all key metrics
and are highly confident that this trend will continue as we progress through
the year. Each of our geographical operations, Israel, the U.K. and the U.S.,
have delivered strong performance in the first quarter and appear to be gaining
momentum. Fueling this momentum is successful execution of our
growth-through-acquisition strategy -- a strategy that we intend to perpetuate
in key global markets through the balance of the year."
Nissenson added, "We remain firmly on pace and believe that we will achieve
our stated revenue guidance for the year. Currently tracking at an annualized
revenue run-rate of nearly US$32 million, and after factoring the anticipated
impact and timing of enhanced organic growth initiatives and targeted
acquisitions, our forecasted objective of $36-$38 million appears to be right in
line."
XFONE will also host a teleconference tomorrow, Tuesday, May 16, 2006, beginning
at 9:15 AM Eastern, and invites all interested parties to join management in a
discussion regarding the Company's financials, corporate progression and other
meaningful developments. The conference call can be accessed in the U.S. by
dialing toll-free 1-800-240-4186. International callers can access the call by
dialing 303-262-2125. For those unable to participate at that time, a replay of
the teleconference can be accessed domestically by dialing 1-800-405-2236 and
enter the pass-code 11059904#. International callers may dial 303-590-3000 and
enter the pass-code 11059904#. The replay will be available for 30 days.
XFONE, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
|
Three
Months Ended
March 31, |
Three Months
Ended March 31, |
|
2006 Pounds |
2005 Pounds |
2006 US$ |
| Revenues |
4,501,289 |
3,312,934 |
$7,841,245 |
| Cost of revenues |
(2,868,452) |
(2,274,071) |
(4,996,843) |
| Gross profit |
1,632,837 |
1,038,863 |
2,844,402 |
| Operating
Expenses: |
| Research and development |
(5,625) |
(5,000) |
(9,799) |
| Marketing and selling |
(390,213) |
(384,190) |
(679,751) |
| General and administrative |
(1,151,703) |
(638,258) |
(2,006,267) |
| Total operating expenses |
(1,547,541) |
(1,027,448) |
(2,695,817) |
| Operating profit |
85,296 |
11,415 |
148,585 |
| Financing expenses
- net |
(78,471) |
(14,808) |
(136,696) |
Equity in income of
affiliated
company |
51,416 |
33,088 |
89,567 |
| Loss from a change of holding
of affiliated company |
(29,848) |
- |
(51,995) |
| Other income |
6,179 |
2,332 |
10,764 |
| Income before minority interest
and taxes |
34,572 |
32,027 |
60,225 |
| Minority interest |
11,706 |
30,920 |
20,392 |
| Income before taxes |
46,278 |
62,947 |
80,617 |
| Taxes on income |
17,611 |
(19,450) |
30,678 |
| Net income |
63,889 |
43,497 |
$111,295 |
| Earnings Per Share: |
|
|
|
| Basic |
0.008 |
0.007 |
$0.014 |
| Diluted |
0.007 |
0.004 |
$0.013 |
About XFONE, Inc.
A U.S.-domiciled corporation, XFONE, Inc. is an international voice, video and data communications services provider with operations in the United Kingdom, the United States and Israel that offers a wide range of services, which include: local, long distance and international telephony services; prepaid and postpaid calling cards; cellular services; Internet services; messaging services (Email/Fax Broadcast, Email2Fax and Cyber-Number); and reselling opportunities. The Company serves customers worldwide. For the Company’s website, please visit: www.xfone.com
This press release contains forward-looking statements. The words or phrases "should," "would be," "will allow," "intends to," "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," or similar expressions are intended to identify "forward-looking statements." The Company's financial results reflected above should not be construed by any means as representative of the current or future value of its common stock. All information set forth in this press release, except historical and factual information, represents forward-looking statements. This includes all statements about the Company's plans, beliefs, estimates and expectations. These statements are based on current estimates and projections, which involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. These risks and uncertainties include issues related to rapidly changing technology and evolving standards in the industries in which the Company and its subsidiaries operate; the ability to obtain sufficient funding to continue operations, maintain adequate cash flow, profitably exploit new business, and license and sign new agreements; the unpredictable nature of consumer preferences; and other factors set forth in the Company's most recently filed annual report and registration statement. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect management's analysis only as of the date hereof. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof. Readers should carefully review the risks and uncertainties described in other documents that the Company files from time to time with the U.S. Securities and Exchange Commission.
| For More Information,
Please Contact: |
| U.S. IR Contact |
Israel IR Contact |
Xfone Contact |
John Nesbett/Jennifer Belodeau
Institutional Marketing Services (IMS)
Phone: 1-203-972-9200
E-mail: jnesbett@institutionalms.com
|
Zvi Rabin
Kwan Communications
Tel: (Israel) +972 50 560 0140
E-mail: zvi@kwan.co.il |
Niv Krikov
Chief Financial Officer
Phone: + 972.39254446 (Israel)
E-mail: niv@xfone.com |
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