HitCom to File for Reporting Status
Prerequisite for NASDAQ Eligibility to be Completed
ST. LOUIS--(BUSINESS WIRE)--March 24, 1998--HitCom Corporation (NASDAQ/OTC:HICO - news), a facilities-based telecommunications company headquartered in St. Louis, Missouri, announced that it would submit Form 10-SB to the SEC this week in order to become a ''reporting company'' required to file quarterly as well as annual reports with the SEC. The ''reporting company'' status is a prerequisite to be eligible for NASDAQ.
Last week, HitCom also released pro forma results for the twelve-months ended December 31, 1997, including the acquisition of HitCom's new subsidiary Channel Telecom Inc., which is expected to close in April. The pro forma results would have boosted HitCom's revenue to $4,513,246 and operating profit to $181,871. Furthermore, the company would have reported basic and fully-diluted Earnings Per Share of $.01.
According to David Parks, HitCom's Chief Financial Officer, the company has completed an exciting year that included the acquisition of 80% of the voting stock of One Plus Marketing, Inc. effective April 1, 1997, the pending acquisition of Channel Telecom Inc. effective January 1, 1998, and the implementation of numerous other measures that have improved the company's management team, financial flexibility and market position
One Plus Marketing, Inc.
One Plus' 1997 revenues increased 81% from approximately $1.9 million in 1996. This record year is consistent with One Plus' performance over the past few years. ''One Plus' sales do not show any signs of slowing in the near future,'' said Dawn Echols, a spokesperson for One Plus Marketing, Inc. ''As a matter of fact, with the new switching platform HitCom plans to introduce this year and our recent expansion into Canada, we're looking forward to another banner year.''
According to Parks, HitCom is currently reviewing its options to purchase the remaining minority interest in One Plus this year.
Channel Telecom Inc.
HitCom signed a Definitive Agreement on February 18, 1998, to acquire all of the outstanding shares of Channel Telecom Inc. for approximately 3.8 million shares of HitCom's common stock and $175,000 in cash. The transaction is scheduled to close in April, 1998, with an effective date of January 1, 1998.
Channel is currently the fourth largest facility-based provider of prepaid phone cards in Canada. Channel's success is attributed, in part, to a broad based retail distribution network that includes 1,500 outlets. Channel also recently announced that it was the official network provider for a series of prepaid phone cards featuring the world famous Rolling Stones. The world exclusive agreement to market the prepaid cards was obtained by Babylon 1 PhoneCards, a partnership that includes Channel Telecom.
Channel's sales were also up significantly from 1996. Channel reported revenues of $945,079(US) in 1997, representing a 56% increase over the previous year.
WorldCom Affiliation
In October of 1997, HitCom announced an affiliation with WorldCom, Inc. (NASDAQ:WCOM - news) that is expected to result in a savings on HitCom's long distance call transport costs beginning in late 1997. HitCom's management believes that the company's gross profit percentage for IVR services should increase between 1-2 percent in 1998 as a result of its affiliation with WorldCom.
Comments from HitCom's Chairman
According to Scott Beil, HitCom's Chairman, ''In 1998, HitCom is committed to an aggressive growth plan designed to significantly increase revenues while maximizing earnings and shareholder value. The company's short-term goal is to continue at an annual revenue growth rate of at least 100% with a mid-range goal of reaching $50 million by 2000. HitCom plans to accomplish these goals through an aggressive acquisition strategy as well as through internal growth including the expansion of existing market shares and new product development and introduction.''
About HitCom
HitCom Corporation, headquartered in St. Louis, Missouri, is a facilities-based telecommunications company that provides enhanced communication services and technologies to businesses and consumers in the United States and Canada. Specifically, HitCom focuses on designing, developing and marketing Interactive Voice Response/Voice Processing Services, Prepaid/postpaid PhoneCards and PhoneCard Platform Services, Internet Connectivity Services, IP Telephony Services and other Emerging Communications Services. HitCom markets its products and services through its subsidiaries One Plus Marketing, Inc. and its current acquisition, Channel Telecom Inc.
HitCom is traded on the NASDAQ Stock Exchange OTC Bulletin Board under the symbol HICO. HitCom can be found on the worldwide web at www.hitcom.com.
Statements contained in this news release regarding expected financial results and other planned events are forward looking statements, subject to uncertainties and risks, including, but not limited to, the demand for HitCom's products and services, and the ability of the company to successfully implement its strategies, each of which may be impacted, among other things, by economic, competitive, or regulatory conditions.
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Contact:
HitCom
Anthony W. Hitt, 314/231-1000 x801
ahitt@hitcom.com |
