Newcall Group Financial Results

Newcall Group Financial Results
For Six Months To 30 June 2002

Newcall Moves Into Black For First Time
Positions for strong future growth in country's emerging broadband market

AUCKLAND 27 AUGUST 2002: Newcall Group Limited is demonstrating the first real signs of recovery. The results of the first six months' performance to 30 June 2002 show the group is trading in the black for the first time since it acquired The New Zealand Salmon Company Limited (NZ Salmon) in October 1999 and launched on the NZSE as Newcall Group Limited (NGL). It is also the first profit for NZ Salmon since 1995.

NGL reported a profit of $365,936 on gross revenues of $12,192,817 for the period. Net profit was however reduced to $144,006 after a $221,930 write down of goodwill as required by the group's auditors. (This compares with gross revenues for the same period last year of $11,833,000 with a loss of $4,5877,000 after write down of goodwill of $790,000.)

The group also benefited from a $527,000 foreign exchange gain in the reporting period by reaching an agreement with all foreign debt holders to convert all US dollar denominated debt into New Zealand dollar denominated debt.

NGL managing director, Jim Bracknell, said that although withdrawing from the telecommunications market was very difficult for the group, it was a timely decision that had freed the company from the operating losses that resulted from being a tolls reseller.

"It has given us a renewed opportunity to use the group's assets, expertise and experience to refocus and continue with the single-minded goals of growing profitable revenue and enhancing value to shareholders," he said.

NGL, he said, was continuing with a solid profitable foundation and as long as existing hedge contracts were in force, the group's electricity retailing subsidiary, Energy Online Ltd, was assured of producing a healthy contribution to the bottom line. "However, the board is continuing to examine options which will maximise shareholder value," he added.

Mr Bracknell said the 'real excitement' for the group lay in the combined strengths of ISP subsidiary Iprolink Ltd, and specialist utility billing and CRM subsidiary, Newcall Technology Ltd.

"Together they are placing NGL in a tremendously advantageous position to provide significant services and systems to the country's emerging broadband networks, particularly those in the rural areas," he said.

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