Phonetime Annual Results -- Revenue Up Over100%.

Business Editors

MISSISSAUGA, Ontario--(BUSINESS WIRE)--June 2, 2000

Phonetime Inc (CDN:PINC) today reported its annual results for fiscal 2000.

Annual Results Continuing and Discontinued Operations (twelve months ended February 29, 2000 compared with February, 1999)

*


				

				
				 
				
    Revenues from continuing operations were $13.74 million compared
     with $5.89 million.
*    Net losses from continuing operations were $1,353 thousands
     compared with earnings of $343 thousand
*    Revenues from discontinued operations were $3.086 million
     compared with $2,748 million.
*    Net losses from discontinued operations were $370 thousands
     compared with losses of $261 thousand

Wayne Silver, President, said, "the growth of our telecommunications subsidiary Phonetime International was dynamic over the past year, during which we achieved significant milestones, including revenue growth of 133%, signing contracts with some of Canada's leading telephone companies as well as the implementation of the first phase of our own long distance network using traditional and VoIP technology."

Silver added, "Of most significance this year was the choice of a Cisco switching platform as the hub of our long distance network. The company invested heavily in the 4th quarter in both infrastructure and personnel, in anticipation of the volume and saving we will realize from this decision. The company expected to have the platform operating during the last quarter but due to unforeseen delays with software provided by a 3rd party integrator to operate the Cisco switch, commercial use of the platform was delayed until the end of May. The losses due to these delays are reflected in last year's results and will continue during the first quarter. However, subsequent to the year-end, we were successful in raising $4 million dollars in a special warrant financing and continue to execute our business plan to expand our products and services. In the next months, we plan to introduce a significant expansion of our network presence as well as new B2B, business to business and B2C, business to consumer long distance products and services through our web site www.phonetime.com and our own sales and distribution network."

The financial statements also reflect the discontinued operations for sales of photo accessories made by Phonetime's - Provincial Products subsidiary.

Phonetime is an emerging telecommunications company with a Class A International Carrier license from the CRTC and has received approval to proceed with its application to become a CLEC (Competitive Local Exchange Carrier). It incorporates state-of-the-art VoIP (Voice over Internet Technology) for commercial applications, a high-capacity switching platform and an international network of carriers. Phonetime operates a multilingual, 24-hour/seven-day-per-week call centre dedicated to phone card customer service and sells its own branded cards under such names as Millennium, Bravo and Nuvo. It also provides phone cards to Blockbuster Canada, Business Depot/Staples, Future Shop and others.

Phonetime Inc. currently has approximately 32,890,083 common shares issued and outstanding. Web Site http://www.phonetime.com