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PAYLINE SYSTEMS ANNOUNCES 75-PERCENT YEAR-END REVENUE INCREASE

 PORTLAND, Ore., Nov. 20 ~PRNewswire~ -- Payline Systems Inc. (OTC Pink Sheets), a Portland-based provider of telecommunications operator services, announced record-breaking year-end gross revenues of $6,001,000. This reflects a 75-percent increase over fiscal year 1991 revenues of $3,439,000. Additionally, the company was able to narrow the previous year's net loss.
 According to Roger Pease, president of Payline, "The dramatic increase in revenues was primarily due to the expansion of Payline's network capabilities in the Northeast made possible through a strategic relationship formed with RCI Long Distance Inc. in September 1991."
 With these expanded capabilities, Payline launched a concentrated marketing effort with key customers which was particularly successful in the public payphone equal access market in New York state.
 Although the company experienced a net loss of $1,708,000 in fiscal 1992, gross profits were up 9 percent to $844,000 on gross profit margins of 14 percent versus the previous year's 23 percent. This is due to the company's expansion into the lower-margin public payphone equal access market and the support of an aggressive sales strategy including higher commissions paid to customers. The strong revenue increases in the last half of the year reflect the success of these efforts.
 Payline's operating expenses rose 37 percent to $2,316,000 in fiscal 1992, but dropped to 39 percent of revenues from 49 percent of revenues in the previous year. The majority of this increase was due to an increased provision for uncollectibles resulting from the higher incidence of bad debt associated with public payphone traffic. In addition, the company hired additional key marketing personnel.
 The monthly trend of revenues during fiscal year 1992 was dramatic. Revenues steadily increased over the last seven months, quadrupling from $297,000 in January to $1,189,000 in July -- the first million-dollar month in Payline history. This jump was reflected in best-ever fourth- quarter revenues of $2,709,000 that accounted for almost half of 1992's record-breaking revenue.
 Payline is currently examining a public operator service called MONEY TALK(TM). MONEY TALK is a long-distance service available to the public in which a five-digit access code used in conjunction with a calling card or collect call saves the user 10 percent to 53 percent on rates. The program is being test marketed in Oregon to both out-of- state business travelers and college students who make a high percentage of calling card calls.
 The company carries interstate traffic originating from 33 states: intrastate traffic is carried in 22 of the 33 states. Payline System's operator services product is known as OASIS(SM).
 Payline Systems Inc., which introduced its OASIS services in 1987, is one of the oldest companies in the alternate operator services segment of the telecommunications industry. The company's common stock, PAYL, is traded over-the-counter on the "pink sheets" published by the National Quotation Bureau. Payline currently employs 70.
 -0- 11~20~92
 ~CONTACT: Wendy Lane of Lane Advertising & Public Relations, 503-221-0480, for Payline Systems~


CO: Payline Systems Inc. ST: Oregon IN: TLS SU: ERN

LM-LA -- SE001 -- 3232 11~20~92 08:00 EST
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Publication:PR Newswire
Date:Nov 20, 1992
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