3rd Quarter Performance Report and Earnings Guidance Released By Yak Communications Inc.

News Editors/Business Editors/High-Tech Writers

MIAMI & TORONTO--(BUSINESS WIRE)--May 14, 2004

Sales continue to increase quarter over quarter.

Yak Communications Inc. (NASDAQ:YAKC), a provider of telecommunication services to residential and business customers, today released its performance report for the third quarter of fiscal 2004.

For the quarter ended March 31, 2004, Yak announced sales of $21,465,000, an increase of 103 percent over sales of $10,592,000 for the comparable period ending March 31, 2003. Earnings per share was 11 cents, which amount is one cent lower than previous quarter's earnings per share principally because of a special charge of $125,000 in connection with accelerated depreciation on two Harris legacy switches which have been de-commissioned.

During the quarter ended March 31, 2004 Yak processed 266 million minutes of traffic with 22 million calls serving approximately 800,000 monthly customers on its own network. This period represents the first quarter that Yak has crossed the threshold of a processing-run-rate of a billion minutes per annum.

For the month of March 2004, Yak consolidated sales were approximately $7,340,000.

The Company's operating divisions contributions to revenues were as follows:

-- Yak 'dial-around' - $5.8 million, which represents an increase

of 49 per cent over sales of $3.9 million during the quarter

ending March 2003;

-- Argos & Contour - 'managed telco resale services to

enterprise' $1.5 million.

-- International Division (Peru) $40,000.

All $ amounts are in US currency.

"We are very pleased with our results and accomplishments during the quarter," said Yak President and CEO Charles Zwebner. "We increased sales by approximately 6% over the previous quarter, demonstrating continued growth. We also started the migration of telephony traffic from our Harris legacy switches on to our next generation Santea switch. Currently, we anticipate decommissioning the last two Harris switches during the next three months (without further material costs associated with accelerated depreciation). Full migration to the Santera switch will then provide for greater efficiency and capacity, and significant cost savings in several areas including some lower cost routing of traffic on our own network, access charges, maintenance, and footprint.

During the quarter, we also raised approximately $18 million in gross proceeds under a private placement financing and we issued 1,470,000 shares of our common stock for a per share purchase price of $12.25 along with warrants (exercisable at $17.00 per share) to purchase 347,500 shares of our common stock. We now have funds available for near-term acquisitions and the deployment of our VoIP broadband telephony initiatives. We continue to strongly believe in our business strategy and financial model and of layering our profitable and stable cash flow business with the more medium-term, high-growth, high-margin broadband initiatives. On April 30, we released a test product of VoIP over DSL and are still on track to have a test product of VoIP over cable during May 2004, and a full commercial rollout of the VoIP initiatives in early September 2004," added Zwebner.

"We anticipate our sales for the current quarter to be approximately $23 million and earnings per share based on the new number of outstanding shares will be $.12 per diluted share.

We continue to remain extremely upbeat about the growth opportunities currently presenting themselves to Yak," said Zwebner.

About YAK Communications Inc.: YAK Communications Inc. (the "Company") (NASDAQ: YAKC) was incorporated in December 1998 in Florida with the objective of providing international long distance discount services to both business and residential customers. The Company specializes in offering these services to consumers by way of a dial-around (known as "10-10"). The Company is a facilities based reseller, which utilizes its own switching systems.

For more information about YAK Communications, please visit www.yak.com

Forward Looking Statements:

Statements contained in this news release which are not strictly historical are forward looking within the meaning of the safe harbor clause of the Private Securities Litigation Reform Act of 1995. The Company makes these statements based on information available to it as of the date of this news release and assumes no responsibility to update or revise such forward-looking statements 

Editors and investors are cautioned that forward-looking statements invoke risk and uncertainties that may cause the Company's actual results to differ materially from such forward-looking statements.

Words such as "projects", "believe", "anticipates", "estimate", "plans", "expect", "intends", and similar words and expressions are intended to identify forward-looking statements and are based on our current expectations, assumptions, and estimates about us and our industry. In addition, any statements that refer to expectations, projections or other characterizations of future events or circumstances are forward-looking statements. Although the Company believes that such forward-looking statements are reasonable, we cannot assure you that such expectations will prove to be correct. Our actual results could differ materially from those anticipated in such forward-looking statements as a result of several factors, risks and uncertainties. These factors, risks and uncertainties include, without limitation, the Company's success in integrating the operations of its newly-acquired businesses, and associated reduction in costs, the successful implementation of its business plans including growth of existing product offerings, strategic acquisitions and development of broadband telephony products, the successful integration of new management team members, continued and increased demand for its services, the successful deployment of new equipment and realization of material savings therefrom, competition from larger and/or more experienced telecommunications providers, its ability to continue to develop its markets, general economic conditions, changes in governmental regulation, and other factors that may be more fully described in the Company's literature and periodic filings with the Securities and Exchange Commission. You are urged to carefully review and consider these disclosures which describe certain factors which affect our business.