MONTREAL, April 25, 2005 (PRIMEZONE) -- TelePlus Enterprises, Inc. (OTCBB:TLPE) (http://www.teleplus.ca), a vertically integrated provider of wireless and landline communications products and services across North America, is pleased to provide investors with a comprehensive update on TelePlus' recently announced acquisitions.
OVERVIEW OF ACQUISITION STRATEGY
Since last December, TelePlus has signed and executed definitive agreements with 5 companies (Keda Consulting, Inc., Freedom Phone Lines, Telizon Inc., Canada Reconnect, Inc., and Avenue Reconnect, Inc.).
The acquisition of these companies has facilitated the creation of TelePlus Connect, a prepaid landline and long distance service department. As a result of their experience in this industry, Keda Consulting was retained to manage the TelePlus Connect division The TelePlus Connect business plan anticipates that the Company will generate $112M in revenue and $28M in EBITDA over the next 60 months. As compensation, Keda Consulting will be compensated on an "earn-out" schedule based on the achievement by TelePlus Connect of specific EBITDA benchmarks during the next 48 months.
The acquired companies provide local, long distance and Internet prepaid services primarily to residential customers (except for Telizon which provides services to business users) across Canada. Total number of combined users of the target companies exceeds 29,300.
Freedom's acquisition was closed on April 1st, 2005. All other acquisitions are anticipated to close within 150 days subject to TelePlus satisfying its due diligence requirements and obtaining necessary financing.
POSITIVE IMPACT ON FINANCIAL STATEMENTS
Upon closure of all transactions the acquired companies will increase TelePlus' revenues by an estimated $21M and contribute in excess of $3.2M to earnings (before taxes). All target companies are to be rolled into TelePlus Connect and key management retained on a go-forward basis.
The following table summarizes the anticipated financial impact of the acquisitions on TelePlus' performance.
2004 Full Pro forma
Year after
Results Acquisitions(1)
----------- ---------------
Revenues $12,180,501 $12,180,501
Addition to run rate $4,000,000
Freedom $2,500,000
Telizon $12,000,000
Canada Reconnect $5,400,000
Avenue $1,100,000
---------------
Total Revenues $12,180,501 $37,180,501
=========== ===============
Income (Loss) before interest,
taxes, depreciation &
amortization per 2004 full
year results (677,295) (677,295)
Freedom 300,000
Telizon 1,600,000
Canada Reconnect 1,000,000
Avenue 200,000
----------- ---------------
(677,295) 2,422,705
Total Income (Loss) before
interest, taxes, depreciation &
amortization
Less: Depreciation,
Amortization, Interest 396,675 500,000
----------- ---------------
Net Income (Loss) before Taxes ($1,073,970) $1,922,705
=========== ===============
Income taxes (recovery) 0 0
Net Income (Loss) ($1,073,970) $1,922,705
=========== ===============
(1) Pro forma results can vary and are subject to various
conditions such as but not limited to (a) market conditions,
(b) competitive landscape, (c) closing of all acquisitions
(no assurances at this time can be given that all
acquisitions will be completed), (d) maintaining current
revenue run rate and earnings post closing of the target
companies, (e) TelePlus satisfying its due diligence
requirements and (f) TelePlus obtaining required financing.
"We are presented with the opportunity to expedite our business plan by 18 months and we intend to take it. Our focus now turns towards the successful completion of all acquisitions and post-closing integration. The acquisition of Keda (now TelePlus Connect) and Freedom were successfully completed," stated TelePlus CEO Marius Silvasan. "I have full confidence in TelePlus Connect's management team which counts over 40 years experience in telecommunications with a specialty in acquisition and integration. We intend to continue growing organically our other businesses during the consolidation of the target companies," added Silvasan.
(1USD = 1.22CDN)
This press release is available on the company's official on-line investor relations site for investor commentary, feedback and questions. Investors are asked to visit http://www.agoracom.com and view the TelePlus Investor Relations Hub. Alternatively, investors are asked to e-mail all questions and correspondence to TLPE@agoracom.com where they can also request addition to the TelePlus investor e-mail list to receive all future press releases and updates directly.
About TelePlus http://www.teleplus.ca
TelePlus Enterprises, Inc. ("TelePlus") is a vertically integrated provider of wireless and landline products and services across North America. The Company's retail division -- TelePlus Retail Services, Inc. -- owns and operates a national chain of TelePlus branded stores in major shopping malls, selling a comprehensive line of wireless and portable communication devices. TelePlus Wireless Corp. operates a virtual wireless network selling cellular network access to distributors in the United States. TelePlus Connect Corp. is a reseller of landline and long distance services including Internet services.
The statements which are not historical facts contained in this press release are forward-looking statements that involve certain risks and uncertainties, including but not limited to risks associated with the uncertainty of future financial results, additional financing requirements, development and acquisition of new product lines and services, government approval processes, the impact of competitive products or pricing a technological changes, the effect of economic conditions and other uncertainties, and the risk factors set forth from time to time in the Company's SEC reports, including but not limited to its annual report on Form 10-KSB; its quarterly reports on Forms 10-QSB; and any reports on Form 8-K. TelePlus Enterprises, Inc. takes no obligation to update or correct forward-looking statements.