Newcall Showing New Growth

Media Release
From Newcall Group Limited
3 September 2001

Newcall Showing New Growth

AUCKLAND 3 SEPTEMBER 2001: Following the closure of its New Zealand telco, Newcall Group Limited’s New Zealand focus has been on its retail electricity subsidiary, Energy Online Limited, resulting in an increased turnover of $10.583 million for the six months to June 30, 2001.

The increase in operating revenues was due mainly to the success of electricity retailing subsidiary Energy Online Ltd (EOL).

"We have managed to stop the haemorrhaging and the New Zealand operations are back on track to profitability," said NGL Managing Director, Jim Bracknell.

During the period, NGL reported a consolidated loss of $4.587M, of which $2.9M resulted from start up costs incurred by Newcall Communications Singapore PE Ltd, the group's telco subsidiary in Singapore.

Mr Bracknell said that once the sell-down of Singapore Communications (voted by shareholders at the annual general meeting in June) is completed during the third quarter, it would no longer be included in the group's consolidated accounts.

He said that when the Singapore loss was removed from the financial results, it was clear the New Zealand operations were looking profitable.

Mr Bracknell said that losses in New Zealand of $1.890M resulted primarily from the close down of Newcall Communications Ltd, including the write-off of goodwill of $800,000.

He said that EOL's excellent performance was despite the fact that new sales had been stopped for part of the period because of spiralling wholesale electricity prices. This he said was done to protect both the company and its 15,000 customers.

While the company was gearing to begin selling once more, he said that the events during the winter power crisis had made it quite evident that incumbent generators were no longer supportive of independent retailers. For this reason, NGL was taking steps to develop EOL offshore.

"We are especially interested in Australia which is deregulating its electricity market from January 1, 2002 and where we see a much more conducive environment for EOL to operate in," he said.

Newcall Technology (NTL), which holds the group's billing expertise from both the telecommunications and electricity subsidiaries was also looking very promising, said Mr Bracknell.

During the period NTL licensed Rocom Wireless the rights to use its telephone technology on an exclusive basis in New Zealand and on a non-exclusive basis for Australia in return for a 3.3 per cent stake in Rocom.

In a second arrangement, NTL and Auckland custom software developer, Scimitar Technologies Ltd, had signed a cross-licensing agreement giving each other the right to on-sell telecommunications billing, power billing and customer management systems to a maximum $1 million per package.

In Singapore, Newcall Communications Singapore PTE is now fully licenced and operational and in the past six months has sold five times more international minutes per month via prepaid calling cards and IDD than was ever sold by Newcall Communications in New Zealand.

Mr Bracknell said that the recent offer to buy back all shares from investors holding less than 2000 shares had also been successful. The offer had resulted in the number of NGL shareholders being almost halved and this would result in a substantial reduction in the group's statutory compliance costs he said. "At the same time a large number of shareholders showed their confidence in the group by increasing the size of their portfolios," he added.

ends

About Newcall Group Limited

In New Zealand NGL is an electricity and utility systems company, with a very active telco subsidiary in Singapore. Its subsidiaries are electricity retailer Energy Online Ltd, Singapore telco Newcall Communications Singapore PTE Ltd, specialist utility software distributor Newcall Technology, and internet service provider, Internet Prolink (NZ) Ltd 'Iprolink'.

New Zealand, Energy Online and Newcall Technology, now make up the group's major business activities.

In Singapore Newcall Communications is one of only 10 international companies to have won a telco licence, and has full technical certification and an interconnection agreement with SingTel.

The company’s principal shareholder is Charoong Thai Wire & Cable Public Company, a subsidiary of Asia Pacific Wire and Cable Corporation, a US company that is traded on the NYSE.

ENDS

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