 Glentel Inc. Reports 4th Quarter and Year End 2008 ResultsSALES GROW TO $289.3 MILLION AND ADJUSTED NET INCOME PER SHARE OF $1.30 Burnaby, British Columbia – March 12, 2009 – Glentel Inc. (TSX: GLN) today reported its results for the 4th quarter and year ended December 31, 2008. Financial highlights, tabular amounts in thousands of Canadian dollars (except percentage and per share data), are:
Note: Adjusted net income for the year was $1.30 per share. Adjusted net income is a non-GAAP measure and may not be comparable between companies. Glentel believes adjusted net income is a useful measure of performance. Adjusted net income and adjusted net income per share is calculated as net income and basic net income per share, respectively, before the goodwill impairment charge of $4,625 ($0.41 per share). Consolidated sales for the year ended December 31, 2008 grew 31%, to $289,333,000 compared to $221,593,000 for the same period of 2007. Operating income before impairment of goodwill, interest and taxes grew 19% to $20,589,000 compared to $17,297,000 in 2007. In the 4th quarter, management recorded an impairment charge of $4,625,000 against the goodwill of the Business Division. Consolidated net income before the goodwill impairment charge was $14,148,000 ($1.30 per share) compared to $10,577,000 ($1.01 per share) in 2007. Consolidated net income after the goodwill impairment charge was $9,523,000 ($0.89 per share) compared to $10,577,000 ($1.01 per share) in 2007. Growth in sales was due to a 39% increase in sales in the Retail Division. During the 2008 year, Glentel’s Retail Division opened 24 new retail stores, resulting in an 11% growth in number of stores operating at December 31, 2008 compared to 2007. Same-store activations of mobile phones and other wireless devices sold in the year increased 17% over the previous year in stores that were open throughout both 2008 and 2007. The Retail Division sales of mobile phone products and services grew to $249,033,000 for the year ended December 31, 2008, compared to $179,800,000 in 2007. Divisional operating income before interest and taxes increased 36% to $32,673,000, compared to $24,104,000 in 2007. Growth in sales in the second half of the year was enhanced by the introduction and customer acceptance of Smartphone technology. The new Smartphone products such as the BlackBerry Bold, Samsung Instinct, and Apple iPhone created excitement and demand in the industry, of which the Retail Division took full advantage by recording exceptionally strong 3rd and 4th quarter results. The Business Division sales of terrestrial narrowband and broadband radio systems, satellite network services, and implementation services were $40,300,000 for the year ended December 31, 2008, compared to $41,793,000 in 2007. Divisional operating loss before goodwill impairment, interest and taxes was $17,000, compared to income of $2,017,000 in 2007. Sales and operating results have declined in the division over the previous year, and as a result of management’s assessment of current and forecasted conditions, a $4,625,000 goodwill impairment charge was recorded in the 4th quarter. Consolidated sales for the 4th quarter ended December 31, 2008 increased 27% to $87,507,000, compared to $68,918,000 in 2007. Growth in sales was due to a 33% increase in sales in the Retail Division, while sales in the Business Division were flat. Operating income before goodwill impairment, interest and taxes for the 4th quarter ended December 31, 2008 was $7,867,000, compared to $8,007,000 in 2007. Consolidated net income was $897,000 ($0.08 per share), compared to $4,798,000 ($0.46 per share), for the same quarter last year. Sales in the Retail Division in the 4th quarter ended December 31, 2008 were $76,044,000, compared to $57,405,000 in 2007. Same-store activations of mobile phones and other wireless devices sold increased 18% in the 4th quarter for stores that were open throughout the same period in both 2008 and 2007. Sales were strengthened in the 4th quarter with an emphasis on sales of data service activations. This was aided by the introduction of the BlackBerry Pearl Flip and the BlackBerry Storm in the 4th quarter, which added to the success of sales of the Apple iPhone and the BlackBerry Bold introduced in the 3rd quarter. Operating income before interest and taxes for the Retail Division increased 18% to $11,109,000 for the 4th quarter of 2008, compared to $9,403,000 the same period the previous year. Sales in the Business Division in the 4th quarter ended December 31, 2008 were $11,463,000, compared to $11,513,000 in 2007. Sales were significantly impacted by the challenging economic times. However, during the 4th quarter the division announced and launched a $2.4 million contract to upgrade the SkyTrain Wayside Radio System for the South Coast British Columbia Transportation Authority. Revenue from this project ($615,000) that met certain deliverable milestones was recognized in the quarter. The balance of the contract ($1,770,000) is expected to be delivered in the 1st quarter of 2009. Operating income for the Business Division for the 4th quarter of 2008, before goodwill impairment, interest and taxes, was $125,000 compared to $983,000 the same period the previous year. 2008 was a very strong year for Glentel. Glentel’s Retail Division expanded its presence to 248 retail stores, and same-store activation comparables continued to increase. The Business Division concentrated on its transitional plan to that of a communications solutions provider while targeting customers whose business relates to involvement in certain economic stimulus plans. Glentel has a very strong balance sheet, with $23.2 million in cash and short-term investments and only $3.7 million of debt, which positions Glentel to take advantage of opportunities and endure current economic uncertainties. “We are pleased to report that the Company continues to grow and bring customers through its retail channel with products that are being very well accepted by its customers,” said Thomas Skidmore, Glentel’s President and Chief Executive Officer. “We are in an industry segment where consumer expenditures are less likely to be eliminated during an economic downturn. With the strength of the financial health of our Company, we are cautiously optimistic of our prospects in 2009.” Forward-Looking Statements: Statements in this release relating to matters that are not historical fact are forward-looking statements based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. Factors that could cause or contribute to such differences include, but are not limited to, general economic conditions, changes in technology, reliance on third-party manufacturing, managing rapid growth, limited intellectual property protection, and other risks and uncertainties described in Glentel's public filings with securities regulatory authorities. NO STOCK EXCHANGE, SECURITIES COMMISSION, OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN. About GLENTEL
GLENTEL (TSX: GLN) is a leading provider of innovative and reliable telecommunications services and solutions in Canada and the United States. Founded in 1963 and headquartered in Burnaby, BC, GLENTEL comprises two operating divisions – Retail and Business – that service thousands of consumers and commercial telecommunications customers. Together with its divisions, the company operates more than 270 corporate locations across Canada located in retail malls, Costco Wholesale warehouses, and business centers. As the largest multi-carrier mobile phone retailer in Canada, it offers a choice of network carrier and wireless device or phone. To its business and government customers, Glentel offers wireless service, rental equipment, satellite and terrestrial network systems, tower sites and wireless asset monitoring. Glentel operates its business under the trading names Glentel Wireless, WirelessWave, The Telephone Booth (Tbooth and la cabine T) and WIRELESS etc. NO STOCK EXCHANGE, SECURITIES COMMISSION, OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN. CONTACT INFORMATION Investor Relations Contact:
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