Covista Communications, Inc. Announces Operating Results for Quarter and Six Months Ended July 31, 2002; Major Portion of Loss Attributable To Non-Cash Items.

Business Editors

CHATTANOOGA, Tenn.--(BUSINESS WIRE)--Sept. 23, 2002

Covista Communications, Inc. (NASDAQ symbol: CVST) today announced operating results for the three-month and six-month periods ended July 31, 2002.

For the three months ended July 2002, the Company reported a loss of $3,607,000 or $0.28 a share on sales of $25,681,000 as compared with a profit of $85,560 or $0.01 per share on sales of $28,892,000 for the prior year's fiscal period. The Company reported a loss of $6,471,000 or $0.51 per share on revenues of $50,229,000 for the six months ended July 31, 2002, as compared with a loss of $4,507,000 or $0.47 per share on revenues of $58,336,000 for the comparable period in the prior fiscal year.

John Leach, President and Chief Executive Officer of Covista, explained that the major portion of the six-month loss is attributable to non-cash items. According to Mr. Leach, $4,164,000 of the loss, or $0.36 per share, is derived from amortization and depreciation. "When these non-cash items are factored out, the actual loss from continuing operations is reduced to $0.15 per share," said Mr. Leach. "In addition, we now are beginning to fully realize the economic benefits of having closed the Company's former headquarters facility in Little Falls, New Jersey. This, coupled with the completion of a second reduction in force in the current fiscal year, both as previously reported, are expected to significantly reduce operating expenses going forward." Mr. Leach concluded, "I am confident that these operating changes, along with the continued rapid expansion of the Company's residential long distance program, will return the Company to positive cash flow in the not-too-distant future."

About Covista:

Covista is a facilities-based long distance telecommunications, Internet and data services provider with a substantial customer base in the residential, commercial and wholesale market segments. Its products and services include a broad range of voice, data and Internet solutions, including long distance and toll-free services, calling cards, frame relay, Internet access, VPN, directory assistance and teleconferencing services. The wholesale division provides domestic and international termination services to carriers worldwide. Covista currently owns and operates switches in New York City, Newark, New Jersey, Philadelphia, Dallas and Chattanooga, and has announced plans to expand to an additional switch site in Minneapolis. Covista operates Network Operations, call center and information technology facilities in Chattanooga to monitor its switched network and to coordinate its various services. For information on becoming a Covista customer, please telephone [phone] or visit the Company's website at www.covista.com.

The following is a consolidated summary of operations (unaudited) for the quarter and six months ended July 31, 2002 and 2001:

               Three-Months Ended July 31   Six-Months Ended July 31
                  2002          2001            2002          2001
             -------------- -------------- ------------- -------------


Revenues      $ 25,680,946   $ 28,892,331  $ 50,229,089  $ 58,336,354
Cost and
 expense        29,811,973     28,849,972    57,027,141    63,157,162
Operating
 income (loss)  (4,131,027)        42,359    (6,798,052)   (4,820,808)
Other net
 income            524,357         43,201       326,706       313,702
Net earnings
 (loss)         (3,606,700)        85,560    (6,471,346)   (4,507,106)
Comprehensive
 income (loss) $(3,606,700)    $   85,560   $(6,471,346) $ (4,507,106)
             -------------- -------------- ------------- -------------
Basic earnings
 (loss) per
 common share     $  (0.28)       $  0.01      $  (0.51)     $  (0.47)
Diluted earnings
 (loss) per
 common share     $  (0.28)       $  0.01      $  (0.51)     $  (0.47)
Average number of
 common shares
     Basic      12,670,805     10,819,405    12,568,524     9,568,783
     Diluted    12,670,805     11,105,508    12,568,524     9,568,783

Information relating to forward-looking statements:

This press release contains historical and forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements such as statements of the company's plans, objectives, expectations and intentions involve risks and uncertainties. The cautionary statements made in this release should be read as being applicable to all related statements wherever they appear. Statements containing terms such as "believes," "expects," "plans," "projects," "intends," "estimates," "anticipates," or similar terms, are considered to contain uncertainty and are forward-looking statements. The actual results could differ materially from those discussed. Factors that could contribute to such differences include: changes in market conditions and increased competition from other telecommunications and internet service providers, including wireless providers; government regulations; the volatile and competitive environment for internet telephony; advances in competitive products or technologies that could reduce demand for services; availability of transmission facilities; management of growth; customer concentration and attrition; the ability to successfully integrate acquired companies; the ability to successfully develop and bring new services to market; inaccurate or incomplete assumptions on the part of management; and other risks discussed in the company's SEC filings, including form 10-k and form 10-q, which can be accessed at the SEC web site at www.sec.gov.

Readers of this release should understand that it is not possible to predict or identify all such risk factors. Consequently, this list should not be considered a complete statement of all potential risks or uncertainties. Covista does not assume the obligation to update any forward-looking statement, except as is required by applicable law.