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Debt Portfolio Sale is Expected to Generate $18.35 Million in Cash
Proceeds
IDT Corporation (NYSE: IDT; IDT.C) said today that it has closed a
transaction to sell substantially all of the consumer debt portfolio
held by its IDT Carmel division for $18.35 million.
“The sale of our existing debt portfolio advances IDT’s previously
announced strategic objectives. We have eliminated our exposure to
fluctuations in debt portfolio valuations during a time of great
volatility in that market, increased our working capital, and further
narrowed management’s focus on core business operations,” said IDT CEO
Jim Courter. IDT stated that it has no current plans to acquire
additional debt portfolios.
IDT entered the debt collection and portfolio management business in
2006. During Fiscal 2007, its IDT Carmel division purchased consumer
debt portfolios for an aggregate purchase price of $78.4 million and
realized $5.4 million in revenue. In Fiscal 2008, IDT Carmel reported
$45.6 million in revenue, and an additional $8.9 million during the
first quarter of Fiscal 2009. As of October 31st, 2008, IDT
Carmel’s portfolio was valued at $59.5 million. The Company said it
expected to report a write down of current and long term assets from
discontinued operations totaling $37 million during the 2nd
quarter of its 2009 fiscal year as a result of the sale announced today.
About IDT Corporation
IDT
Corporation (www.idt.net)
is a consumer-focused multinational holding company. IDT Corporation’s
Class B Common Stock and Common Stock trade on the New York Stock
Exchange under the ticker symbols IDT and IDT.C, respectively.
In this press release, all statements that are not purely about
historical facts, including, but not limited to, those in which we use
the words “believe,” “anticipate,” “expect,” “plan,” “intend,”
“estimate, “target” and similar expressions, are forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995.While these forward-looking statements
represent our current judgment of what may happen in the future, actual
results may differ materially from the results expressed or implied by
these statements due to numerous important factors, including, but not
limited to, those described in our most recent report on SEC Form 10-K
(under the heading “Management’s Discussion and Analysis of Financial
Condition and Results of Operations”), which may be revised or
supplemented in subsequent reports on SEC Forms 10-Q and 8-K.These
factors include, but are not limited to, the following: potential
declines in prices for our products and services; our ability to
maintain and grow our retail telecommunications services, particularly
our prepaid calling card business; availability of termination capacity;
financial stability of our customers; our ability to maintain carrier
agreements with foreign carriers; effectiveness of our marketing and
distribution efforts; increased competition, particularly from regional
bell operating companies; our ability to manage our growth; impact of
government regulation; our ability to obtain telecommunications products
or services required for our products and services; and general economic
conditions, particularly in the telecommunications markets.We
are under no obligation, and expressly disclaim any obligation, to
update the forward-looking statements in this press release, whether as
a result of new information, future events or otherwise.
Investor Relations:
IDT Corporation
Bill
Ulrey, 973-438-3838
or
Public Relations:
IDT
Corporation
Gil Nielsen, 610-704-6622
