News

TORONTO – December 8, 2014 – Tucows Inc. (NASDAQ:TCX, TSX:TC), a provider of network access, domain name and other Internet services, announced today that it is commencing its “modified Dutch auction Tender Offer” (the “Tender Offer”) to repurchase a number of its common shares not to exceed an aggregate purchase price of $8.0 million, as previously announced on November 12, 2014. The closing price of Tucows common stock on the NASDAQ on December 5, 2014 was $17.45.

Under the Tender Offer, shareholders will have the opportunity to tender some or all of their shares at a price within the range of $16.50 to $18.50 per share. Based on the number of shares tendered and the prices specified by the tendering shareholders, Tucows will determine the lowest per share price within the range that will enable it to buy up to $8.0 million worth of shares, or such lesser number of shares that are properly tendered. Assuming that the offer is fully subscribed, if the Purchase Price is determined to be $16.50 per share, the minimum Purchase Price under the Tender Offer, the approximate number of shares that will be purchased under the offer is 484,848. Assuming that the Tender Offer is fully subscribed, if the Purchase Price is determined to be $18.50 per share, the maximum Purchase Price under the offer, the approximate number of shares that will be purchased under the offer is 432,432. If more than $8.0 million worth of shares are properly tendered, the number of shares to be repurchased by Tucows pursuant to the tender offer may, at the discretion of Tucows, be increased by up to 2% of Tucows’ outstanding shares, without amending or extending the tender offer. Rawleigh Ralls, a director of Tucows, has advised Tucows that he expects to sell up to 75,000 shares in the Tender Offer.

Shareholders whose shares are purchased in the offer will be paid the determined purchase price per share net in cash, without interest, after the expiration of the offer period at 5:00 P.M., New York City Time, on Wednesday, January 7, 2015.

Tucows intends to fund the purchase of shares up to $8.0 million pursuant to the offer, including the related fees and expenses, from cash on hand. However, if more than $8.0 million in value of shares are tendered in the offer at or below the Purchase Price and the Company exercises its right to purchase up to an additional 2% of our outstanding shares, the Company may fund a portion of this purchase from one of its demand loan facilities with the Bank of Montreal.

The Depositary and Paying Agent for the tender offer is Computershare Trust Company, N.A., c/o Computershare Shareholder Services, Inc., P.O. Box 43011, Providence, RI 02940-3014, Attn: Corporate Actions. The Information Agent for the tender offer is Georgeson Inc., 480 Washington Blvd, 26th Floor, Jersey City, NJ 07310.

Neither Tucows, its board of directors or the information agent is or will be making any recommendation to shareholders as to whether to tender or refrain from tendering their shares into the Tender Offer. Shareholders will be able to obtain copies of the offer to purchase, related materials filed by the Company as part of the statement on Schedule TO and other documents filed with the Securities and Exchange Commission through the SEC’s internet address at www.sec.gov without charge when these documents become available. Shareholders and investors may also obtain a copy of these documents, as well as any other documents the Company has filed with the SEC, without charge, from the Company or at the Company’s website: www.tucows.com. Shareholders are urged to carefully read these materials, when available, prior to making any decision with respect to the offer. Shareholders and investors who have questions or need assistance may call Georgeson Inc., the information agent for the tender offer, at (800) 509-0983.

This release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any shares of the Company’s common stock. The solicitation and offer to buy the Company’s common stock will only be made pursuant to the offer to purchase and related materials that the Company is sending to its shareholders. Shareholders should read those materials carefully because they will contain important information, including the various terms and conditions of the Tender Offer.

About Tucows

Tucows is a provider of network access, domain name and other Internet services. Ting (https://ting.com) is a mobile phone service provider dedicated to bringing clarity and control to US mobile phone users. OpenSRS (http://opensrs.com) manages over 13 million domain names and millions of value-added services through a global reseller network of over 13,000 web hosts and ISPs. Hover (http://hover.com) is the easiest way for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (http://tucows.com).

This release includes forward-looking statements based on management’s current expectations. These statements, include statements regarding our expectations with respect to the Tender Offer and the related participants, terms and conditions of the Tender Offer and are subject to a number of uncertainties and risks that could cause actual events to differ materially from those described in the forward-looking statements including general market conditions. Information about other potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the SEC. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All forward-looking statements are based on information available to Tucows as of the date they are made. Tucows assumes no obligation to update any forward-looking statements, except as may be required by law.

TUCOWS is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Contact:

Lawrence Chamberlain
TMX Equicom
(416) 815-0700 ext. 257
lchamberlain@tmxequicom.com

TORONTO, November 12, 2014 — Tucows Inc. (NASDAQ:TCX, TSX:TC), a provider of network access, domain name and other Internet services, today announced it expects to commence within 30 days of this announcement a “modified Dutch auction” tender offer (the “Tender Offer”) to repurchase a number of shares of its common stock not to exceed an aggregate purchase price of $8.0 million. In accordance with rules of the Securities and Exchange Commission (“SEC”), Tucows may increase the number of shares accepted for payment in the offer by no more than 2 percent of the outstanding shares without amending or extending the tender offer. Tucows also announced that it has suspended its normal course issuer bid, which commenced in March 2014 and pursuant to which Tucows has repurchased 79,392 shares of common stock.

The Tender Offer will allow shareholders to indicate how many shares and at what price within the Company’s specified range they wish to tender. Tucows will select the lowest single per-share purchase price that will allow it to buy up to $8.0 million of its outstanding common stock at completion of the Tender Offer. The specified range is yet to be determined but is expected to be in the range of $16.00 to $18.00 per share. All shares purchased by the Company in the Tender Offer will be purchased at the same price and will be cancelled. The Company will not purchase stock below a shareholder’s indicated price, and in some cases, the Company may purchase shares at a price that is above a shareholder’s indicated price under the terms of the Tender Offer.

The Tender Offer will not be conditioned upon any minimum number of shares being tendered, but will be subject to customary conditions that will be described in the Tender Offer documents. The offer to purchase and related Tender Offer documents, which will be distributed to shareholders upon commencement of the Tender Offer, will also contain tendering instructions and a complete explanation of the Tender Offer’s terms and conditions.

Neither Tucows, its board of directors nor its agents is or will be making any recommendation to shareholders as to whether to tender or refrain from tendering their shares into the Tender Offer. Shareholders must decide whether to tender their shares and, if so, how many shares to tender and at what price or prices. In doing so, shareholders should carefully evaluate all of the information in the Tender Offer documents, when available, before making any decision with respect to the Tender Offer, and should consult their own financial and tax advisors.

Rawleigh Ralls, a director of Tucows, has advised Tucows that he expects to participate in the tender offer.

The Tender Offer described in this release has not yet commenced. This release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any shares of the Company’s common stock. The solicitation and offer to buy the Company’s common stock will only be made pursuant to the offer to purchase and related Tender Offer documents, which are expected to be distributed to shareholders within thirty days of this announcement. Shareholders will be able to obtain copies of the offer to purchase and related Tender Offer documents when available without charge through the SEC’s website at www.sec.gov or from the Company’s website at www.tucows.com. Shareholders are urged to carefully read these materials, when available, prior to making any decision with respect to the offer.

About Tucows

Tucows is a provider of network access, domain name and other Internet services. Ting (https://ting.com) is a mobile phone service provider dedicated to bringing clarity and control to US mobile phone users. OpenSRS (http://opensrs.com) manages over 13 million domain names and millions of value-added services through a global reseller network of over 13,000 web hosts and ISPs. Hover (http://hover.com) is the easiest way for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (http://tucows.com).

This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995 including statements regarding our expectations regarding our future financial results and, in particular, our expectations for Ting and its impact on our financial performance. These statements are based on management’s current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements, including the acceptance of Ting in the market. Information about other potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the Securities and Exchange Commission. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All forward-looking statements are based on information available to Tucows as of the date they are made. Tucows assumes no obligation to update any forward-looking statements, except as may be required by law.

TUCOWS is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Contact:

Lawrence Chamberlain
TMX Equicom
(416) 815-0700 ext. 257
lchamberlain@tmxequicom.com

— Quarter Highlighted by Net Earnings of $0.24 Per Share, Continued Momentum at Ting —

TORONTO, November 12, 2014 – Tucows Inc. (NASDAQ:TCX, TSX:TC), a provider of network access, domain name and other Internet services, today reported its financial results for the third quarter ended September 30, 2014. All figures are in U.S. dollars.

Summary Financial Results
(In Thousands of US Dollars, Except Per Share Data)

3 Months Ended Sept. 30, 2014 (unaudited) 3 Months Ended Sept. 30, 2013 (unaudited) 9 Months Ended Sept. 30, 2014 (unaudited) 9 Months Ended Sept. 30, 2013 (unaudited)
Net revenue 38,874 35,637 108,865 96,795
Income before provision for income taxes and change in fair value of forward exchange contracts 4,072 3,565 7,462 4,944
Net income 2,691 2,593 4,515 3,258
Net earnings per common share¹ $0.24 $0.24 $0.40 $0.32
Net cash provided by (used in) operating activities 5,014 3,664 6,110 7,052

¹ Net earnings per common share reflects the 1-for-4 reverse split of common shares that became effective December 31, 2013.

Summary of Revenues and Cost of Revenues
(In Thousands of US Dollars)

Revenue Cost of Revenue
3 Months Ended Sept. 30, 2014 (unaudited) 3 Months Ended Sept. 30, 2013 (unaudited) 3 Months Ended Sept. 30, 2014 (unaudited) 3 Months Ended Sept. 30, 2013 (unaudited)
Domain Services
Wholesale
OpenSRS Domain Service 21,880 22,003 18,230 18,581
Value-Added Services 2,350 2,606 576 485
Total Wholesale 24,230 24,609 18,806 19,066
Retail 2,687 2,143 1,197 946
Portfolio¹ 2,208 4,167 189 660
Total Domain Services 29,125 30,919 20,192 20,672
Network Access Services (Ting) 9,749 4,718 5,794 3,597
 
Network, other costs - - 1,139 1,193
Network, depreciation and amortization costs - - 172 176
Total revenue/cost of revenue 38,874 35,637 27,297 25,638

¹Portfolio revenue for Q3 2014 and Q3 2013 includes the net amounts received from the previously announced confidential arrangements related to the Company’s withdrawal of its application under the ICANN New gTLD Program for .group, and .media and .marketing, respectively.

“In the third quarter we again saw the growing contribution from Ting in our financial results as our Domain Services businesses continued to deliver consistent, reliable performance,” said Elliot Noss, President and Chief Executive Officer, Tucows Inc. “We achieved net earnings of $0.24 per share, bringing net earnings for the year-to-date to $0.40 per share, surpassing our total for the entire 2013 year. Consolidated gross margin increased to 26% from 21% a year earlier, excluding the Portfolio group, which benefited from atypical contributions in both quarters.”

“Ting continued its strong momentum in customer acquisition, adding almost 11,000 accounts and more than 17,000 devices.”

Net revenue for the third quarter of 2014 increased 9% to $38.9 million from $35.6 million for the third quarter of 2013.

Net income for the third quarter of 2014 was $2.7 million, or $0.24 per share, compared with $2.6 million, or $0.24 per share, for the third quarter of 2013. Net income for both the third quarters of 2013 and 2014 included the contribution of confidential arrangements related to the Company’s withdrawal of certain of its applications under the ICANN New gTLD Program.

Cash and cash equivalents at the end of the third quarter of 2014 were $13.6 million, compared with $14.2 million at the end of the second quarter of 2014 and $11.5 million at the end of the third quarter of 2013. During the third quarter of 2014, the Company generated cash flow from operating activities of $5.0 million, as well as $1.1 million from the proceeds of stock options. This was partially offset by the use of $5.4 million for the repayment in full of the Company’s bank loan and $1.1 million for the repurchase of shares under the Company’s ongoing share buyback program.

Conference Call

Tucows management will host a conference call today, Wednesday, November 12, 2014 at 5:00 p.m. (ET) to discuss the Company’s third quarter 2014 results. Participants can access the conference call by dialing 1-888-231-8191 or 647-427-7450 or via the Internet at http://www.tucows.com/investors.

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 416-849-0833 or 1-855-859-2056 and enter the pass code 21916055 followed by the pound key. The telephone replay will be available until Wednesday, November 19, 2014 at midnight. To access the archived conference call as an MP3 via the Internet, go to http://www.tucows.com/investors.

About Tucows

Tucows is a provider of network access, domain name and other Internet services. Ting (https://ting.com) is a mobile phone service provider dedicated to bringing clarity and control to US mobile phone users. OpenSRS (http://opensrs.com) manages over 13 million domain names and millions of value-added services through a global reseller network of over 13,000 web hosts and ISPs. Hover (http://hover.com) is the easiest way for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (http://tucows.com).

This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995 including statements regarding our expectations regarding our future financial results and, in particular, our expectations for Ting and its impact on our financial performance. These statements are based on management’s current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements, including the acceptance of Ting in the market. Information about other potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the Securities and Exchange Commission. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All forward-looking statements are based on information available to Tucows as of the date they are made. Tucows assumes no obligation to update any forward-looking statements, except as may be required by law.

TUCOWS is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Contact:

Lawrence Chamberlain
TMX Equicom
(416) 815-0700 ext. 257
lchamberlain@tmxequicom.com

To Top