MISSISSAUGA – Strong sales at Phonetime’s wholesale division helped to drive up consolidated revenues for its third quarter by 13.2% over last year.
For the quarter ended September 30, 2009, consolidated revenue was $44.4 million, up from $39.2 million for third quarter of 2008. Its wholesale division buys and resells telecommunications long-distance services to telephone carriers around the world using a call trading platform.
Phonetime also generates revenues through its consumer division, which provides pre-paid calling cards and long-distance services to targeted ethnic consumer groups across Canada. It currently has more 130,000 customers using its long-distance retail services.
Operating income was $683,000 for the quarter, down from $913,000 in the prior quarter and down from $1.75 million in the third quarter of 2008.
Gross margin declined to 11.7% for the quarter and 12.5% for the year to date versus 12.5% and 13.6% in the year prior corresponding periods. In absolute terms, the decline in contribution from gross margin was $357,000 in the three month period ended September 30, 2009 but contributed an additional $445,000 for the year to date.
Net Income for the quarter was $31,000 versus $751,000 for the corresponding period in 2008. Cash flow from operating activities was a net outflow of $422,000 in the quarter as compared to a contribution of $1.8 million in the prior year.
