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Press release from Marketwire

Phonetime Earned Net Income of $0.02 Per Share for Each of 2012 and 2011

Thursday, March 21, 2013

Phonetime Earned Net Income of $0.02 Per Share for Each of 2012 and 201119:41 EDT Thursday, March 21, 2013TORONTO, ONTARIO--(Marketwire - March 21, 2013) - Phonetime Inc. (TSX:PHD) announced today its audited consolidated financial results for 2012.Revenue was $103 Million, compared to $121 Million in 2011. Net income was $0.02 per share, or $2.4 Million, compared to $0.02 per share, or $3.4 Million, in 2011. Fourth quarter - 2012 run rate revenue was $120 Million.CONSOLIDATED STATEMENTS OF OPERATIONS(amounts in thousands of U.S. dollars, except per share information)Years ended December 3120122011$$Revenue102,896120,835Cost of revenue95,850113,485Gross margin7,0467,350Operating expenses3,8034,814Depreciation of property and equipment120517Amortization of intangible assets8501,056Stock-based compensation53113Interest and debt costs160338Gain on retirement of debt(260)-Mark to fair value of common share warrants(1)(2,290)4,7254,548Income before income taxes2,3212,802Provision for (recovery of) income taxesCurrent15(180)Deferred(76)(394)(61)(574)Net and comprehensive income for the year2,3823,376Earnings per share- basic and diluted0.020.02Weighted-average number of common shares- basic and diluted156,936,971157,482,177At December 31, 2012, Phonetime had $2.2 million in cash, available borrowings of an additional $2.5 million and remained debt free. As at December 31, 2012, Phonetime had assets of $21 million and shareholder's equity of $11 million. During 2012, the Company acquired and cancelled 7.5 million common shares, representing 4.8% of the outstanding stock, and paid off all remaining debt with cash flows from operations.CONSOLIDATED STATEMENTS OF FINANCIAL POSITION(amounts in thousands of U.S. dollars)As atDecember 31,December 31,20122011$$ASSETSCurrentCash and cash equivalents2,28831Accounts receivable, net7,3978,030Prepaid expenses and deposits215151Total current assets9,9008,212Deferred tax assets690818Property and equipment, net454388Intangible assets, net6211,336Goodwill10,12810,12821,79420,882LIABILITIES AND SHAREHOLDERS' EQUITYCurrentBank indebtedness-300Accounts payable3,7743,939Accrued liabilities6,5776,100Income taxes payable3220Current portion of other debts-622Total current liabilities10,38311,001Other debts-374Deferred tax liabilities255459Common share warrants derivatives-1Total liabilities10,63811,815Shareholders' equityCommon shares12,44413,072Contributed surplus2,8172,482Deficit(4,105)(6,487)Total shareholders' equity11,1569,06721,79420,882"In 2013, we expect to see revenue growth in our core business. We also expect to expand our service footprint through organic growth, while we also continue to review investment, acquisition and merger opportunities. We expect to raise capital in 2013 and or to issue debt to support our growth initiatives. In conjunction with opportunities being pursued, we may opt to list our common shares on a US exchange. If we pursue this path, we will consolidate the number of shares outstanding to adhere to US listing requirements," said Gary Clifford, Executive Chairman and CEO. "Since 2009, the Company has made reference to the going concern assumption in its financial statements. We are pleased that our improvements in financial operation and financial position have led management and our external auditors to concur that a reference to the going concern assumption is not required."The Company's financial statements and other disclosures are available on SEDAR.About Phonetime Inc.Established in 1994, Phonetime is a leading provider of international and domestic switched voice services to the worlds telecommunication operators and voice service providers. Phonetime's customers and suppliers include, fixed line operators, mobile operators, retail and VoIP service providers, who buy and sell voice and IP telecommunications services. Phonetime has traders in Europe, Asia and the Americas using its proprietary trading platform with embedded intelligence, which includes profitability benchmarking, call routing, credit management, network quality visibility and loss prevention. As voice technology evolves Phonetime has commoditized its trading philosophy and along with its platform is positioned to emerge as a leading clearing house. Phonetime is a public company listed on the Toronto Stock Exchange (TSX).Caution Regarding Forward Looking Information:This press release contains forward-looking statements, which may be identified by words like "expects", "anticipates", "plans", "intends", "indicates" or similar expressions. These statements are not a guarantee of future performance and are inherently subject to risks and uncertainties. Phonetime's actual results could differ materially from those currently anticipated due to a number of factors set forth in reports and other documents filed by the Company with Canadian securities regulatory authorities from time to time. See www.sedar.com which contains all securities files.FOR FURTHER INFORMATION PLEASE CONTACT: Contact Information: Phonetime Inc.Gary CliffordExecutive Chairman & CEOgclifford@phonetime.comPhonetime Inc.Michael VazquezPresident and COO+954-608-5058mike@phonetime.comwww.phonetime.com