CBCI Telecom second quarter revenue up 55 percent - company reports net earnings of $0.01 per share.

MONTREAL--(BUSINESS WIRE)--Nov. 7, 1996--CBCI TELECOM INC. (ME, TSE: CAN) -- CBCI Telecom Inc. (CBCI), a leading manufacturer of visual communications systems, today reported revenues from operations of $11.6 million and net earnings of $69,000, or $0.01 per share, for the second quarter ended September 30, 1996, compared to revenues of $7.5 million and a net loss of $0.8 million, or $0.32 per share, in the same quarter last year.

For the six month period ended September 30, 1996, revenues were $19.7 million and net loss was $0.3 million, compared to revenues of $15.0 million and a net loss of $1.7 million for the same period last year.

"CBCI's profitability in the second quarter is mainly attributable to the improvement of our gross margins," said Jeff Speak, president and CEO of CBCI. "Our gross margin percentage improved to 45 percent compared to 35.4 percent in the same period last year, reflecting a shift in the product mix towards higher margin vertical application products and the direct access to core codec technology."

"Our business strategy has been to establish our Canvas Visual Communications division as a leader in the development of vertical applications for the visual communications industry," explained Speak. "We believed that by focusing our efforts in the fastest growing segments of the industry, CBCI would improve its profitability. As evidenced by our second quarter results, we believe that we are focusing on the right strategy."

"On May 29, 1996, we completed a transaction which we identified as key to our turnaround. Upon the acquisition of the remaining 50 percent interest of BT Visual Images L.L.C., we were anticipating significant financial benefits. These benefits are reflected in our second quarter results and are contributing to the improved profitability," said Speak, concluding, "The second quarter results only partially reflect the benefits following our Initial Public Offering which was completed on August 16, 1996. The lower interest costs will be fully reflected in the next quarters."

CBCI Telecom Inc., based in Montreal, is among North America's leading providers of visual communications systems. Through its Canvas Visual Communications business, it designs, manufactures, markets and services a comprehensive portfolio of general purpose and customized, application-oriented visual communication systems for business, institutional and vertical markets. CBCI has sales offices across the United States and Canada.

CONTACT: CBCI Telecom Inc., Montreal

Alain Tanguay, 514/748-5224