Axia Reports Q1

Quarter revenues were $14.5M

November 7, 2007

2 Min Read

CALGARY, Alberta -- Axia NetMedia Corporation ("Axia" or the "Corporation") today announced the results for its first quarter ended September 30, 2007.

1Q2008 Highlights

Axia began deploying self-healing optical ring technology on the Alberta SuperNet, improving network reliability that is already best in class to levels normally only available to special critical customer locations in metropolitan markets. Art Price, Chairman and CEO said, "I believe that this approach enables new mission critical enterprise application services to be used by the many enterprise customers with activities that involve operations outside metropolitan Alberta. Alberta continues to be a showcase on the power of Real Broadband(TM) and Next Generation Network technology when it is made available to every community."

Geoff Thompson, Axia's President remarked, "The Alberta marketplace is now beginning to understand the value proposition that the Alberta SuperNet represents. We are organized to respond to meet both our existing customers' evolving needs and attract new customers. In terms of our financial results, the gross profit from our North American segment increased 20 percent compared to the same period in fiscal 2007. Our gross profit margin for this segment remained consistent with the fourth quarter of fiscal 2007 at 48 percent.

"Our business in France continues to evolve and we expect that it will be late in calendar year 2008 before results based on market penetration will provide meaningful indications of successful market penetration," said Mr. Thompson. During the first quarter of fiscal 2008, the Corporation announced the département of Hérault had awarded Covage, a French company jointly owned by Axia and VINCI Networks, interests in a 22-year network Délégations de Service Public ("DSP"). Covage's existing interests and additional interests being acquired through its agreements with VINCI will result in Covage owning interests in 13 private companies contracted to operate public networks. The Corporation expects that all material transfers of DSP interests into Covage will be completed by the end of this calendar year.

The Corporation continues to participate in the public competitive bid processes being conducted by the governments of Western Australia and Singapore. These are expected to draw to a conclusion in the first half of calendar 2008. In the other jurisdictions, Axia continues to have confidential preliminary discussions.

"Through fiscal 2008 Axia will continue to pursue international opportunities with the attendant business development expenses," said Art Price, Chairman and CEO. "However, we believe that the risk reward profile of these opportunities is attractive to our shareholders."

Axia NetMedia Corp. (TSE: AXX)

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