NEWARK, N.J., May 22, 2018 – IDT Corporation (NYSE: IDT), a global provider of communications and payment services, is scheduled to report third quarter fiscal 2018 (the three months ended April 30, 2018) financial and operational results on Tuesday, June 5, 2018.

IDT’s earnings release will be issued and posted on the IDT investor relations website (www.idt.net/ir) at approximately 4:30 PM Eastern.

IDT will host an earnings conference call beginning at 5:30 PM Eastern with management’s discussion of results, outlook and strategy followed by Q&A with investors. 

To listen to the call and participate in the Q&A, dial toll-free 1-888-348-8417 (from U.S.) or 1-412-902-4243 (international) and request the IDT Corporation call.

A recording of the conference call can be accessed approximately two hours after the call concludes through June 19, 2018, by dialing 1-844-512-2921 (toll-free from the US) or 1-412-317-6671 (international) and providing this call number: 10120736.  A recording will also be available via streaming audio at the IDT investor relations website (www.idt.net/ir).

About IDT Corporation:
IDT Corporation (NYSE: IDT) provides communications and payment services to individuals and businesses primarily through its flagship Boss Revolution^® and net2phone^® brands.  IDT’s wholesale carrier services business is a leading global carrier of international long-distance calls.  For more information on IDT, visit www.idt.net.

 

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SOURCE IDT Corporation

NEWARK, N.J., March 8, 2018 — IDT Corporation (NYSE: IDT) reported EPS of $0.06 on revenue of $395.9 million for the second quarter of FY 2018, the three months ended January 31, 2018.  

HIGHLIGHTS  
(2Q18 results are compared to 2Q17)

• The spin-off of Rafael Holdings to IDT stockholders has been scheduled for on or about March 26^th;
• IDT has declared a dividend of $0.09 per share for 2Q18;
• Revenue of $395.9 million compared to $367.6 million;
• Loss from operations of $0.5 million compared to income from operations of $3.1 million;
• Adjusted EBITDA* of $6.3 million compared to $9.3 million;
• EPS of $0.06 compared to EPS of $0.04;
• Non-GAAP EPS* of $0.00 compared to $0.12; 
• The sale of IDT’s Gibraltar-based bank remains pending regulatory approval.

*Throughout this release, non-GAAP EPS, Adjusted EBITDA, and non-GAAP Net Income for all periods presented are non-GAAP measures intended to provide useful information that supplements IDT’s or the relevant segment’s core results in accordance with GAAP.  Please refer to the Reconciliation of Non-GAAP Financial Measures at the end of this release for an explanation of these terms and their respective reconciliations to the most directly comparable GAAP measure. 

REMARKS BY SHMUEL JONAS, CEO OF IDT CORPORATION

“Last week, the Securities and Exchange Commission concluded its review of our spin-off of Rafael Holdings.  As previously announced, we now expect to distribute the Rafael Holdings shares to our stockholders on or about March 26th. The spin-off of Rafael Holdings will include our pharma investments and over $100 million of real estate, cash, marketable securities and investments.

“IDT’s consolidated revenue of $395.9 million in the second quarter represents a $28.3 million increase compared to the year ago quarter. The revenue growth was contributed by two verticals – Wholesale Carrier, which generated its sixth consecutive quarter of revenue increases and Payment Services, reflecting increases in money remittance transactions originating from our direct to consumer channels and by sales of international and domestic mobile top-up. Retail Communications revenue decreased, but we have slowed the rate of decline while improving Retail’s margin contribution.

“Our growth initiatives are performing well and have begun to contribute significantly to our top line growth.  Looking ahead, we will be reducing our SG&A spend, primarily in our legacy offerings, while continuing to maintain and support the investment behind our growth initiatives.

“In light of our intention to continue to invest heavily in our promising growth initiatives and the impact of the spin-off of Rafael on our balance sheet, IDT’s Board of Directors has reduced our dividend for the second quarter to $0.09 per share.”

2Q18 CONSOLIDATED RESULTS 
(Results are for 2Q18 and compared to 2Q17 unless otherwise noted).

Consolidated results for all periods presented include corporate overhead as a separate segment.  The corporate segment loss from operations decreased to $3.3 million from $3.7 million in 2Q17 primarily because of a decrease in stock-based compensation, which declined to $632 thousand from $1.0 million. 

Net income attributable to IDT in 2Q18 was $1.5 million or $0.06 per diluted share, including a benefit from income taxes of $3.3 million as a result of a change in US tax law, compared to net income attributable to IDT of $0.9 million or $0.04 per diluted share in 2Q17.

At January 31, 2018, IDT held $100.3 million in cash, cash equivalents and marketable securities.  At the time of the spin-off, Rafael Holdings will have approximately $44 million in cash, cash equivalents, and marketable securities, as well as $6 million in hedge fund investments and other investment securities.  The hedge fund and securities holdings are currently included in “Investments” on the balance sheet. 

Net cash provided by operating activities during 2Q18 was $3.5 million compared to net cash used in operating activities of $6.3 million in 2Q17. In the same periods, capital expenditures were $5.6 million and $5.0 million, respectively. 

2Q18 RESULTS BY SEGMENT
(Results are for 2Q18 and compared to 2Q17 unless otherwise noted).

Telecom Platform Services (TPS)
TPS is comprised of communications and payment offerings grouped in three broad verticals: Retail Communications, Wholesale Carrier Services and Payment Services.  Effective 1Q18, TPS’ Retail Communications vertical also includes the results of IDT’s Consumer Phone Services (CPS).  CPS was previously reported as a separate segment.  All comparative prior periods have been adjusted to conform to the current presentation.  The TPS segment contributed 97.8% of IDT’s consolidated revenue in 2Q18 and 97.9% in 2Q17. 

TPS’ 2Q18 revenue increased 7.5% to $387.1 million.  Consistent with recent trends, the Wholesale Carrier Services and Payment Services verticals achieved robust revenue growth – more than offsetting a decline in Retail Communications’ revenue. 

Retail Communications:  IDT’s flagship BOSS Revolution^® calling service – which accounted for over 90% of Retail Communications’ revenue in 2Q18 – continued to be impacted by increased adoption of over-the-top voice and messaging, unlimited calling plans, as well as decreased immigration into the U.S.  These long-term, market-wide trends resulted in a 4.2% reduction in BOSS Revolution calling service’s revenue compared to the year ago quarter.  The rate of decline has slowed in recent quarters.  Revenue from other Retail Communications offerings,
including the sale of traditional ‘hard’ prepaid calling cards in the U.S. and overseas, continued to decline in line with expectations.

Wholesale Carrier Services:  Wholesale Carrier Services’ revenue increased 18.3% as IDT’s carrier service continued to gain market share. Wholesale Carrier Services’ revenue has historically been more volatile than Retail Communications’ revenue, and changes in revenue do not necessarily generate corresponding changes in gross profit.

Payment Services:  Payment services revenue increased 16.5% year over year primarily reflecting growth in mobile top-up sales, which comprise 90% of Payment Services’ revenue.  Sales generated by the BOSS Revolution international money transfer service, primarily from its direct to consumer offering (app and web) and from National Retail Solutions’ merchant services offerings, also increased. 

TPS’ direct cost of revenue expressed as a percentage of revenue increased to 86.4% from 85.6%.  This increase reflects margin pressure on Wholesale Carrier Services’ offerings and a shift of revenue mix within TPS towards Wholesale Carrier Services, which generates relatively lower gross margins than Retail Communications’ offerings. In contrast, Retail Communications’ margins continued to improve during 2Q18.

TPS’ SG&A expense – $43.5 million – increased 6.8% from 2Q17, primarily on higher personnel and credit card processing costs.  Expressed as a percentage of revenue, SG&A expense decreased to 11.2% from 11.3% in the year ago quarter.  TPS’ depreciation and amortization expense increased slightly to $4.1 million from $4.0 million in 2Q17.

TPS’ income from operations decreased to $4.6 million, including the impact of $0.2 million in severance expense, from $7.2 million in 2Q17, as the increase in SG&A expense outpaced TPS’ increase in revenue less direct cost.  Adjusted EBITDA decreased to $8.9 million in 2Q18 from $11.2 million in 2Q17.

net2phone – Unified Communications as a Service (UCaaS)
The net2phone-UCaaS segment is comprised of offerings from IDT’s net2phone^® division, including its cloud communications and SIP trunking offerings for businesses, and its cable telephony service.

net2phone-UCaaS’ 2Q18 revenue increased to $8.3 million from $7.1 million in 2Q17, driven by the rapid growth in its cloud-based communications offering – both in the U.S. and in South America. 

net2phone-UCaaS’ 2Q18 loss from operations was $790 thousand compared to a loss from operations of $464 thousand in 2Q17, reflecting increased sales commissions and other personnel costs. IDT continues to invest in the proprietary technologies that power net2phone’s unified cloud communications offerings, and to finance front-loaded sales and commission expenses.

All Other
All Other includes interests in clinical stage pharmaceutical companies, Rafael Pharmaceuticals, Inc. and Lipomedix Pharmaceuticals Ltd., both of which are developing cancer therapies, as well as IDT’s real estate holdings, comprised of its public garage in Newark and commercial properties in Newark, Piscataway and Jerusalem, and other small businesses and investments.

All Other’s financial results for 2Q18 were consistent with expectations.

IDT’s subsidiary, Rafael Holdings, owns IDT’s real estate and pharmaceutical holdings included in All Other.  IDT expects to effectuate the spin-off of Rafael Holdings on or about March 26, 2018.

DIVIDEND
In light of IDT’s commitment to continue investment in its growth initiatives and the impact of the spin-off of Rafael Holdings on the company’s balance sheet, on March 5, 2018, IDT’s Board of Directors reduced the company’s dividend, declaring a quarterly dividend of $0.09 per share of IDT’s Class A and Class B common stock for 2Q18 to be paid on or about March 23, 2018.  The dividend will be paid to stockholders of record as of the close of business on March 19^th.  This distribution will be treated as a return of capital for tax purposes.

IDT EARNINGS ANNOUNCEMENT & SUPPLEMENTAL INFORMATION
This release is available for download in the “For Investors” section of the IDT Corporation website (http://idt.net/ir) and has been filed on a current report (Form 8-K) with the SEC.

IDT will host an earnings conference call today beginning today at 5:30 PM Eastern with management’s discussion of results, outlook and strategy followed by Q&A with investors. 

To listen to the call and participate in the Q&A, dial toll-free 1-888-348-8417 (from U.S.) or 1-412-902-4243 (international) and request the IDT Corporation call.

A recording of the conference call can be accessed approximately two hours after the call concludes through March 13, 2018, by dialing 1-844-512-2921 (toll-free from the US) or 1-412-317-6671 (international) and providing this call number: 10117078.  A recording will also be available via streaming audio at the IDT investor relations website (www.idt.net/ir).

ABOUT IDT:
IDT Corporation (NYSE: IDT), through its IDT Telecom division, provides communications and payment services to individuals and businesses primarily through its flagship Boss Revolution® and net2phone® brands.  IDT Telecom’s wholesale business is a leading global carrier of international long-distance calls.  For more information on IDT, visit www.idt.net.

All statements above 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.  Our filings with the SEC provide detailed information on such statements and risks, and should be consulted along with this release. To the extent permitted under applicable law, IDT assumes no obligation to update any forward-looking statements.

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measures for the Second Quarter Fiscal 2018 and 2017

In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States of America (GAAP), IDT also disclosed, for 2Q18, 1Q18 and 2Q17, Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share, which are non-GAAP measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.

IDT’s measure of Adjusted EBITDA consists of revenues less direct cost of revenues and selling, general and administrative expense. Another way of calculating Adjusted EBITDA is to start with income from operations, and add depreciation and amortization, severance expense and other operating expense.

IDT’s measure of non-GAAP net income starts with net income (loss) in accordance with GAAP and adds severance expense, stock-based compensation, and other operating expense, and subtracts the income tax benefits from The Tax Cuts and Jobs Act and the release of the valuation allowance and full recognition of deferred tax assets. 

IDT’s measure of non-GAAP earnings (loss) per share is calculated by dividing non-GAAP net income (loss) by the basic or diluted weighted-average shares.

These additions and subtractions are non-cash and/or non-routine items in the relevant fiscal 2018 and fiscal 2017 periods.

Management believes that IDT’s Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share measures provide useful information to both management and investors by excluding certain expenses and non-routine gains and losses that may not be indicative of IDT’s or the relevant segment’s core operating results. Management uses Adjusted EBITDA, among other measures, as a relevant indicator of core operational strengths in its financial and operational decision making. In addition, management uses Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share to evaluate operating performance in relation to IDT’s competitors. Disclosure of these financial measures may be useful to investors in evaluating performance and allows for greater transparency to the underlying supplemental information used by management in its financial and operational decision-making. In addition, IDT has historically reported similar financial measures and believes such measures are commonly used by readers of financial information in assessing performance, therefore the inclusion of comparative numbers provides consistency in financial reporting at this time.

Management refers to Adjusted EBITDA, as well as the GAAP measures income (loss) from operations and net income (loss), on a segment and/or consolidated level to facilitate internal and external comparisons to the segments’ and IDT’s historical operating results, in making operating decisions, for budget and planning purposes, and to form the basis upon which management is compensated.

While depreciation and amortization are considered operating costs under GAAP, these expenses primarily represent the non-cash current period all
ocation of costs associated with long-lived assets acquired or constructed in prior periods. IDT’s Adjusted EBITDA, which is exclusive of depreciation and amortization, is a useful indicator of its current performance.

Severance expense is excluded from the calculation of Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share. Severance expense is reflective of decisions made by management in each period regarding the aspects of IDT’s and its segments’ businesses to be focused on in light of changing market realities and other factors. While there may be similar charges in other periods, the nature and magnitude of these charges can fluctuate markedly and do not reflect the performance of IDT’s core and continuing operations.

Other operating expense is a component of income (loss) from operations. In fiscal 2018, other operating expense included legal fees related to potential liabilities and claims under agreements related to IDT’s spin-off in 2013 of Straight Path Communications Inc., and fees related to other legal matters. In fiscal 2017, other operating expense included legal fees related to an FCC inquiry, which was also related to IDT’s prior ownership of Straight Path Communications Inc. Other operating expense is excluded from the calculation of Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share. From time-to-time, IDT may incur costs related to non-routine legal and regulatory matters. However, such legal and regulatory matters do not occur each quarter. IDT does not believe the gains or losses from non-routine legal and regulatory matters are components of IDT’s or the relevant segment’s core operating results.

The other calculation of Adjusted EBITDA consists of revenues less direct cost of revenues and selling, general and administrative expense. As the other excluded items are not reflected in this calculation, they are excluded automatically and there is no need to make additional adjustments. This calculation results in the same Adjusted EBITDA amount and its utility and significance is as explained above.

Stock-based compensation recognized by IDT and other companies may not be comparable because of the variety of types of awards as well as the various valuation methodologies and subjective assumptions that are permitted under GAAP. Stock-based compensation is excluded from IDT’s calculation of non-GAAP net income (loss) and non-GAAP earnings (loss) per share because management believes this allows investors to make more meaningful comparisons of the operating results per share of IDT’s core business with the results of other companies. However, stock-based compensation will continue to be a significant expense for IDT for the foreseeable future and an important part of employees’ compensation that impacts their performance.

In 2Q18, IDT recorded an income tax benefit of $3.3 million for its anticipated AMT credit refund due to The Tax Cuts and Jobs Act enacted in December 2017. In 1Q17, IDT recorded a foreign income tax benefit of $16.6 million from the release of the valuation allowance and full recognition of certain deferred tax assets. These income tax benefits are excluded from IDT’s calculation of non-GAAP net income (loss) and non-GAAP earnings (loss) per share because the benefits were not directly related to the current results of IDT’s core operations.

Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share should be considered in addition to, not as a substitute for, or superior to, income (loss) from operations, cash flow from operating activities, net income (loss), basic and diluted earnings per share or other measures of liquidity and financial performance prepared in accordance with GAAP. In addition, IDT’s measurements of Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share may not be comparable to similarly titled measures reported by other companies.

Following are reconciliations of Adjusted EBITDA, non-GAAP net income (loss) and non-GAAP earnings (loss) per share to the most directly comparable GAAP measure, which are, (a) for Adjusted EBITDA, income (loss) from operations for IDT’s reportable segments and net income for IDT on a consolidated basis, (b) for non-GAAP net income (loss), net income (loss) and, (c) for non-GAAP earnings (loss) per share, basic and diluted earnings per share.

 

 

 

 

 

 

 

 

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SOURCE IDT Corporation

NEWARK, N.J., March 2, 2018 – IDT Corporation (NYSE: IDT) and Rafael Holdings, Inc. today announced that the SEC has completed its review of the registration statement and information statement related to the spin-off of IDT’s Rafael Holdings subsidiary to IDT stockholders.  The record date for IDT stockholders entitled to receive the distribution of Rafael Holdings stock has been changed to March 13, 2018, and the distribution date for the spin-off has been changed to on or about March 26, 2018.

The timeline for the spin-off is as follows:

• The record date will be 5:00 PM EDT on March 13, 2018;

• Beginning on March 12, 2018, the entitlement to shares of Rafael Holdings Class B common stock will trade on the NYSE American “when issued” market with the ticker symbol “RFL WI”. On the first day of trading following the distribution date, “when issued” trading will cease, and “regular-way” trading of Rafael Holdings Class B common stock will begin on the NYSE American with the ticker symbol “RFL”;

• Beginning on March 12, 2018, and continuing through the distribution date, there will be two NYSE markets in IDT Class B common stock: a “regular-way” market and an “ex-distribution” market. Shares of IDT Class B common stock exchanged in the “regular-way” market will trade with an entitlement to receive shares of Rafael Holdings Class B common stock through the distribution. Shares of IDT Class B common stock exchanged in the “ex-distribution” market will trade without such an entitlement;

• The spin-off will be effective at 11:59 p.m. EDT on the distribution date, which will be on or about March 26, 2018. On the distribution date, each eligible IDT stockholder will receive one share of Rafael Holdings Class A common stock for every two shares of IDT Class A common stock and one share of Rafael Holdings Class B common stock for every two shares of IDT Class B common stock;

• IDT expects to receive a legal opinion from Goulston & Storrs that the distribution should qualify as a tax-free transaction for U.S. federal income tax purposes. However, cash distributed in lieu of fractional shares generally will be taxable to the recipient stockholders. Stockholders are urged to consult their financial advisors and tax advisors regarding the particular consequences of the distribution in their situation, including, without limitation, the specific implications of selling IDT common stock on or prior to the distribution date and the applicability and effect of any U.S. federal, state, local and foreign tax laws;

• Rafael Holdings Class B common stock has been assigned CUSIP # 75062E 106.

All statements above 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 IDT’s 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. IDT’s filings with the SEC and Rafael Holding’s amended Form 10 Registration Statement provide detailed information on such statements and risks, and should be consulted along with this release. To the extent permitted under applicable law, neither IDT nor Rafael Holdings assumes any obligation to update any forward-looking statements.

About Rafael Holdings, Inc:
Rafael Holdings holds commercial real estate assets and interests in two clinical stage, oncology focused pharmaceutical companies.  The real estate holdings include properties in Newark and Piscataway, New Jersey and Jerusalem, Israel.  The pharmaceutical holdings consist of interests in Rafael Pharmaceuticals, Inc. and a majority stake in Lipomedix Pharmaceuticals Ltd., both of which are focused on development and commercialization of drugs in the oncology space. 

About IDT Corporation:
IDT Corporation (NYSE: IDT), through its IDT Telecom division, provides telecommunications and payment services to individuals and businesses primarily through its flagship Boss Revolution® and net2phone® brands.  IDT Telecom’s wholesale business is a leading global carrier of international long-distance calls.  For more information on IDT, visit www.idt.net.

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SOURCE IDT Corporation

NEWARK, N.J., Feb. 28, 2018 – IDT Corporation (NYSE: IDT), a global provider of communications and payment services, has scheduled its report of second quarter fiscal 2018 (the three months ended January 31, 2018) financial and operational results for Thursday, March 8, 2018.

IDT’s earnings release will be issued and posted on the IDT investor relations website (www.idt.net/ir) at approximately 4:30 PM Eastern.

IDT will host an earnings conference call beginning at 5:30 PM Eastern with management’s discussion of results, outlook and strategy followed by Q&A with investors. 

To listen to the call and participate in the Q&A, dial toll-free 1-888-348-8417 (from U.S.) or 1-412-902-4243 (international) and request the IDT Corporation call.

A recording of the conference call can be accessed approximately two hours after the call concludes through March 15, 2018, by dialing 1-844-512-2921 (toll-free from the US) or 1-412-317-6671 (international) and providing this call number: 10117078.  A recording will also be available via streaming audio at the IDT investor relations website (www.idt.net/ir).

About IDT Corporation:
IDT Corporation (NYSE: IDT), through its IDT Telecom division, provides communications and payment services to individuals and businesses primarily through its flagship Boss Revolution^® and net2phone^® brands.  IDT Telecom’s wholesale business is a leading global carrier of international long-distance calls.  For more information on IDT, visit www.idt.net.

 

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SOURCE IDT Corporation

NEWARK, N.J., Feb. 5, 2018 – IDT Corporation (NYSE: IDT) today announced that the record date for the spin-off of its subsidiary, Rafael Holdings, Inc. (Rafael), to IDT stockholders, will be February 15, 2018, and that distribution date for the spin-off will be on or about March 5th.

Rafael is comprised of IDT’s real estate holdings, its interests in Rafael Pharmaceuticals and Lipomedix, two clinical and early stage pharmaceutical companies, and $50–$60 million in cash, cash equivalents, marketable securities and/or interests in hedge funds.

A copy of Rafael’s amended Form 10 Information Statement is available on the IDT website at www.idt.net/ir.

The current timeline for the spin-off, subject to the Securities and Exchange Commission declaring the Registration Statement effective and approval of the Rafael Class B common stock for listing on the NYSE American exchange, is as follows:

• the record date will be 5:00 PM EDT on February 15, 2018;
• beginning on February 14, 2018, the entitlement to shares of Rafael Class B common stock will trade on the NYSE American “when issued” market with the ticker symbol “RFL WI”.  On the first day of trading following the distribution date, “when issued” trading will cease, and “regular-way” trading of Rafael Class B common stock will begin on the NYSE American with the ticker symbol “RFL”;
• beginning on February 14, 2018, and continuing through the distribution date, there will be two NYSE markets in IDT Class B common stock: a “regular-way” market and an “ex-distribution” market. Shares of IDT Class B common stock exchanged in the “regular-way” market will trade with an entitlement to receive shares of Rafael Class B common stock through the distribution. Shares of IDT Class B common stock exchanged in the “ex-distribution” market will trade without such an entitlement;
• the spin-off will be effective at 11:59 p.m. EDT on the distribution date, which will be on or about March 5, 2018.  On the distribution date, each IDT stockholder entitled will receive one share of Rafael Class A common stock for every two shares of IDT Class A common stock and one share of Rafael Class B common stock for every two shares of IDT Class B common stock;
• IDT expects to receive a legal opinion from Goulston & Storrs that the distribution should qualify as a tax-free transaction for U.S. federal income tax purposes. However, cash distributed in lieu of fractional shares generally will be taxable to the recipient stockholders. Stockholders are urged to consult their financial advisors and tax advisors regarding the particular consequences of the distribution in their situation, including, without limitation, the specific implications of selling IDT common stock on or prior to the distribution date and the applicability and effect of any U.S. federal, state, local and foreign tax laws.
• Rafael Holdings Class B common stock has been assigned CUSIP # 75062E 106

All statements above 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 IDT’s 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. IDT’s filings with the SEC and Rafael’s amended Form 10 Information Statement provide detailed information on such statements and risks, and should be consulted along with this release. To the extent permitted under applicable law, neither IDT nor Rafael assumes any obligation to update any forward-looking statements.

About Rafael Holdings Inc:

Rafael Holdings will own the commercial real estate assets currently held by IDT and interests in certain clinical and early stage pharmaceutical companies. The real estate includes the IDT headquarters building and associated public garage in Newark, New Jersey and other real estate interests in New Jersey and Jerusalem, Israel. The pharmaceutical holdings include convertible debt interests and warrants in Rafael Pharmaceuticals, Inc., a clinical-stage, oncology-focused pharmaceutical company committed to the development and commercialization of therapies that exploit the metabolic differences between normal cells and cancer cells, and a majority equity interest in Lipomedix Pharmaceuticals Ltd., an early stage pharmaceutical development company based in Israel. Rafael will also hold approximately $50–$60 million in cash, cash equivalents, marketable securities and/or interests in hedge funds at the time of the spin-off.

About IDT Corporation:

IDT Corporation (NYSE: IDT), through its IDT Telecom division, provides telecommunications and payment services to individuals and businesses primarily through its flagship Boss Revolution® and net2phone® brands.  IDT Telecom’s wholesale business is a leading global carrier of international long-distance calls.  For more information on IDT, visit www.idt.net.

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SOURCE IDT Corporation

NEWARK, N.J., Dec. 11, 2017 — net2phone, a global provider of cloud-based communications solutions and division of IDT Corporation (NYSE: IDT), today announced a partnership with TeleDomani, Inc., a leading telecom and technology services master agent.

Through the partnership, TeleDomani agents will offer net2phone’s hosted PBX and SIP Trunking solutions to their rapidly growing base of enterprise customers. 

net2phone’s hosted PBX offering includes unlimited domestic and international calling to all destinations in over 20 countries, free Polycom phones, and advanced feature sets including real-time quality of service visibility and optimization.  net2phone’s solutions are optimized to fit the needs of every business regardless of size or current infrastructure.

“net2phone is a perfect fit for our agent community,” said Gina Pigott, Founder and CEO of TeleDomani. “With their robust feature sets, unlimited international calling and free phones all offered in conjunction with agent-driven pricing, an advanced quoting tool, and generous commissions, net2phone’s solutions provide outstanding value for both our agents and their clients.”

net2phone’s president, Jonah Fink, said, “TeleDomani is a remarkable company that has demonstrated the benefits to a highly consultative approach to technology applications.  We look forward to providing TeleDomani’s agents with the tools they need to bring their clients all the benefits of net2phone’s cloud communications solutions.”

net2phone draws on twenty years of industry experience and the power of IDT Telecom to deliver cloud-based communications solutions that are flexible, cost-effective and reliable. 

About net2phone:
net2phone is a rapidly-growing unified communications as a service (UCaaS) provider. net2phone’s flagship hosted PBX and SIP Trunking services are offered exclusively through channel partners. net2phone is a subsidiary of IDTCorporation (NYSE: IDT), a global provider of telecommunications and payment services.  To learn more, please visit net2phone.com, connect with us on LinkedIn, or email partner@net2phone.com.  

About TeleDomani:
TeleDomani, Inc. offers our partners access to managed & professional IT services, Cloud based UcaaS Providers and much more.Top-notch back office support allows agents to focus on their core business, not quotas, commitments or carrier follow up. Technology is constantly evolving; TeleDomani’s dedication to excellence and provider relationships as a leading Master Agent assists our partners in Bringing It All Together.

 

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SOURCE IDT Corporation

NEWARK, N.J., Dec. 5, 2017 – IDT Corporation (NYSE: IDT) reported a loss per share of $0.08 and non-GAAP earnings per share (EPS)* of $0.01 on revenue of $393.6 million for the first quarter of FY 2018, the three months ended October 31, 2017.  

HIGHLIGHTS  
(1Q18 results are compared to 1Q17)

• Revenue of $393.6 million compared to $369.2 million;
• Income from operations of $0.1 million compared to $5.2 million;
• Adjusted EBITDA* of $7.0 million compared to $10.7 million;
• Loss per share of $0.08 compared to diluted EPS of $0.96, which included a net benefit from income taxes of $0.63 per share;
• Non-GAAP EPS* of $0.01 compared to $0.28;
• IDT has declared a dividend of $0.19 per share for 1Q18 to be paid on or about December 29^th.

REMARKS BY SHMUEL JONAS, CEO OF IDT CORPORATION

“Revenue growth in our wholesale carrier business accelerated as we invested to gain market share, more than offsetting the measured decline in revenue from our retail voice communications offerings.  Telecom margins, however, narrowed during the quarter.

“Our growth initiatives met or exceeded our expectations.  BOSS Revolution money transfer – and particularly transactions initiated online or through the BOSS Money app – as well as net2phone’s cloud communications offerings and our National Retail Solutions POS network are growing rapidly.  Subsequent to the quarter close, we formally launched our BOSS Revolution Mobile offering, and are in the process of rolling out this new wireless service to our retail partners nationwide.

“We are making good progress on the planned spin-off of Rafael Holdings.  Rafael recently filed a registration statement, including a preliminary information statement, for the spin-off with the Securities and Exchange Commission.  We expect to conclude the separation and distribution of Rafael Holdings to our shareholders in the first quarter of calendar 2018.  The spin-off will more tightly focus IDT on communications and payments services, and we have begun the planning to streamline our corporate structure and operations to function more efficiently and effectively post-spin.

“Based on our results and financial condition, IDT’s Board of Directors declared a dividend of $0.19 per share for the first quarter.”

1Q18 CONSOLIDATED RESULTS 
(Results are for 1Q18 and compared to 1Q17 unless otherwise noted).

 

 

Consolidated results for all periods presented include corporate overhead.  The corporate loss from operations increased to $3.2 million from $1.3 million in 1Q17 primarily as a result of increased legal expenses.

Net loss attributable to IDT in 1Q18 was $2.1 million or $0.08 per share, including a provision for income tax of $1.4 million, compared to net income attributable to IDT of $21.9 million and diluted EPS of $0.96 in 1Q17, including a $2.1 million gain on foreign currency transactions and a net benefit from income taxes of $14.4 million, mostly due to the reversal of a previous valuation allowance on foreign deferred tax assets. 

At October 31, 2017, IDT held $107.0 million in unrestricted cash, cash equivalents and marketable securities, compared to $148.6 million at July 31, 2017. Current assets totaled $342.4 million and current liabilities totaled $338.4 million.  The decrease in cash, cash equivalents and marketable securities primarily reflects payments during 1Q18 of previously accrued liabilities including seasonal personnel expenses, regulatory fees, and a legal settlement as well as other changes in working capital. IDT also set aside $11.8 million dollars in an escrow account pursuant to its most recent wholesale carrier outsourcing initiative, resulting in a decrease in Cash and Cash Equivalents and a corresponding increase in Other Current Assets.

Net cash used in operating activities during 1Q18 was $30.5 million compared to net cash provided by operating activities of $5.5 million in 1Q17. In the same periods, capital expenditures were $5.3 million and $5.5 million, respectively. 

1Q18 RESULTS BY SEGMENT
(Results are for 1Q18 and compared to 1Q17 unless otherwise noted).

 

Telecom Platform Services (TPS)
TPS is comprised of communications and payment offerings grouped in three broad verticals: Retail Communications, Wholesale Carrier Services and Payment Services.  Effective 1Q18, TPS’ Retail Communications vertical also includes the results of IDT’s Consumer Phone Services (CPS).  All comparative prior periods have been adjusted to conform to the current presentation.  CPS was previously reported as a separate segment. The TPS segment contributed 97.8% of IDT’s consolidated revenue in 1Q18 and 97.9% in 1Q17. 

TPS’ 1Q18 revenue increased 6.5% to $385.1 million.  The Wholesale Carrier Services and Payment Services verticals achieved robust revenue growth – more than offsetting a decline in Retail Communications’ revenue. 

 

Retail Communications:  IDT’s flagship BOSS Revolution^® calling service – which accounted for over 90% of Retail Communications’ revenue in 1Q18 – continued to be impacted by increased adoption of over-the-top voice and messaging, unlimited calling plans, as well as decreased immigration into the U.S.  These long-term, macro trends resulted in a 5.4% reduction in BOSS Revolution calling service’s revenue compared to the year ago quarter.  Revenue from other Retail Communications offerings, including the sale of traditional ‘hard’ prepaid calling cards in the U.S. and overseas, continued to decrease in line with expectations.

Wholesale Carrier Services:  Wholesale Carrier Services’ revenue increased 19% and minutes of use increased 20% compared to the year ago quarter even as the market for international voice calling continued to contract.  Wholesale Carrier Services’ revenue has historically been more volatile than Retail Communications’ revenue, and changes in revenue do not necessarily generate corresponding changes in gross profit.

Payment Services:  Payment services revenue increased 14.6% year over year reflecting growth in mobile top-up sales from new mobile partners and diversification of mobile top-up offerings.  Sales generated by the BOSS Revolution international money transfer service and National Retail Solutions’ merchant services offerings also increased. 

TPS’ direct cost of revenue expressed as a percentage of revenue increased to 86.7% from 85.7%.  This increase reflects margin pressure on Wholesale Carrier Services’ offerings and a shift of revenue mix within TPS towards Wholesale Carrier Services, which generates relatively lower gross margins than Retail Communications’ offerings.

TPS’ SG&A expense – $42.1 million – increased 2.6% from 1Q17 primarily on higher personnel expense.  Expressed as a percentage of revenue, SG&A expense decreased to 10.9% from 11.4% in the year ago quarter, primarily due to the significant revenue increase over the corresponding period.  IDT expects to significantly streamline its operations in conjunction with the spin-off of Raphael Holdings.

TPS’ income from operations decreased to $4.6 million, including the impact of $0.4 million in severance expense, from $6.5 million in 1Q17.  Margin pressure on TPS’ Wholesale Carrier Services’ offerings, the decrease in Retail Communications’ revenue and the increase in SG&A expense contributed to the decrease.

net2phone – Unified Communications as a Service (UCaaS)
The net2phone-UCaaS segment (formerly known as UCaaS) is comprised of offerings from IDT’s net2phone^® division, including its cloud communications and SIP trunking offerings for businesses, and its cable telephony service.

net2phone-UCaaS’ 1Q18 revenue increased to $7.8 million from $7.1 million in 1Q17 due to continued growth from its cable telephony service and cloud-based communications offering – both in the U.S. and in South America.  In light of the strong growth in net2phone’s cloud communications offering in Argentina and Brazil, net2phone anticipates additional international expansion in South America and Asia in FY 2018.

net2phone-UCaaS’ 1Q18 loss from operations was $674 thousand compared to a loss from operations of $174 thousand in 1Q17 reflecting increased SG&A spending including commissions and other personnel expenses reflecting IDT’s continued investment in this business, as well as increased depreciation and amortization expense.

All Other
All Other includes interests in clinical and early stage pharmaceutical companies, including an investment in Rafael Pharmaceuticals, Inc., as well as IDT’s real estate holdings, comprised of its public garage in Newark and commercial properties in Newark, Piscataway and Jerusalem, and other small businesses and investments.

Rafael Pharmaceuticals is a clinical stage, oncology-focused, pharmaceutical company committed to the development and commercialization of therapies that exploit the metabolic differences between normal cells and cancer cells.

All Other’s financial results for 1Q18 were consistent with expectations.

IDT’s subsidiary, Rafael Holdings, has filed a registration statement, including a preliminary information statement, for the spin-off to IDT’s shareholders of IDT’s real estate and pharmaceutical holdings included in All Other.  IDT expects to effectuate the spin-off of Rafael Holdings in the first quarter of calendar 2018.

DIVIDEND
On December 4, 2017, IDT’s Board of Directors declared a quarterly dividend of $0.19 per share of IDT’s Class A and Class B common stock for 1Q18 to be paid on or about December 29, 2017.  The dividend will be paid to stockholders of record as of the close of business on December 18^th.  This distribution will be treated as a return of capital for tax purposes.

IDT EARNINGS ANNOUNCEMENT & SUPPLEMENTAL INFORMATION
This release is available for download in the “For Investors” section of the IDT Corporation website (http://idt.net/ir) and has been filed on a current report (Form 8-K) with the SEC.

IDT will host an earnings conference call today beginning today at 5:30 PM Eastern with management’s discussion of results, outlook and strategy followed by Q&A with investors. 

To listen to the call and participate in the Q&A, dial toll-free 1-888-348-8417 (from U.S.) or 1-412-902-4243 (international) and request the IDT Corporation call.

A recording of the conference call can be accessed one hour after the call concludes through December 12, 2017, by dialing 1-844-512-2921 (toll-free from the US) or 1-412-317-6671 (international) and providing this call number: 10114550.  The recording will also be available via streaming audio at the IDT investor relations website (http://idt.net/ir) following the call.

ABOUT IDT:
IDT Corporation (NYSE: IDT), through its IDT Telecom division, provides communications and payment services to individuals and businesses primarily through its flagship Boss Revolution® and net2phone® brands.  IDT Telecom’s wholesale business is a leading global carrier of international long-distance calls.  For more information on IDT, visit www.idt.net.

All statements above 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.  Our filings with the SEC provide detailed information on such statements and risks, and should be consulted along with this release. To the extent permitted under applicable law, IDT assumes no obligation to update any forward-looking statements.

 

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measures for the First Quarter Fiscal 2018 and 2017

In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States of America (GAAP), IDT also disclosed, for 1Q18, 4Q17 and 1Q17, Adjusted EBITDA, non-GAAP net income and non-GAAP diluted earnings per share, or EPS, which are non-GAAP measures. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.

IDT’s measure of Adjusted EBITDA consists of revenues less direct cost of revenues and selling, general and administrative expense. Another way of calculating Adjusted EBITDA is to start with income from operations, add depreciation and amortization, severance expense and other operating expense, and subtract other operating gain.

IDT’s measure of non-GAAP net income starts with net (loss) income in accordance with GAAP and adds severance expense, stock-based compensation, other operating expense, and the tax expense from the increase in the valuation allowance on deferred tax assets, and subtracts other operating gain, and the tax benefit from the release of the valuation allowance and full recognition of deferred tax assets. 

IDT’s measure of non-GAAP diluted EPS is calculated by dividing non-GAAP net income by the diluted weighted-average shares.

These additions and subtractions are non-cash and/or non-routine items in the relevant fiscal 2018 and fiscal 2017 periods.

Management believes that IDT’s Adjusted EBITDA, non-GAAP net income and non-GAAP EPS measures provide useful information to both management and investors by excluding certain expenses and non-routine gains and losses that may not be indicative of IDT’s or the relevant segment’s core operating results. Management uses Adjusted EBITDA, among other measures, as a relevant indicator of core operational strengths in its financial and operational decision making. In addition, management uses Adjusted EBITDA, non-GAAP net income and non-GAAP EPS to evaluate operating performance in relation to IDT’s competitors. Disclosure of these financial measures may be useful to investors in evaluating performance and allows for greater transparency to the underlying supplemental information used by management in its financial and operational decision-making. In addition, IDT has historically reported similar financial measures and believes such measures are commonly used by readers of financial information in assessing performance, therefore the inclusion of comparative numbers provides consistency in financial reporting at this time.

Management refers to Adjusted EBITDA, as well as the GAAP measures income (loss) from operations and net income, on a segment and/or consolidated level to facilitate internal and external comparisons to the segments’ and IDT’s historical operating results, in making operating decisions, for budget and planning purposes, and to form the basis upon which management is compensated.

While depreciation and amortization are considered operating costs under GAAP, these expenses primarily represent the non-cash current period allocation of costs associated with long-lived assets acquired or constructed in prior periods. IDT’s Adjusted EBITDA, which is exclusive of depreciation and amortization, is a useful indicator of its current performance.

Severance expense is excluded from the calculation of Adjusted EBITDA, non-GAAP net income and non-GAAP EPS. Severance expense is reflective of decisions made by management in each period regarding the aspects of IDT’s and its segments’ businesses to be focused on in light of changing market realitie
s and other factors. While there may be similar charges in other periods, the nature and magnitude of these charges can fluctuate markedly and do not reflect the performance of IDT’s core and continuing operations.

Other operating expense and other operating gain are components of income from operations. In fiscal 2018, other operating expense included legal fees related to potential liabilities and claims under agreements related to IDT’s spin-off of Straight Path Communications Inc. in 2013. In the fourth quarter of fiscal 2017, other operating gain was primarily the result of insurance proceeds related to the claims. Other operating expense and other operating gain are excluded from the calculation of Adjusted EBITDA, non-GAAP net income and non-GAAP EPS. From time-to-time, IDT may incur costs related to non-routine legal and regulatory matters. However, such legal and regulatory matters do not occur each quarter. IDT does not believe the gains or losses from non-routine legal and regulatory matters are components of IDT’s or the relevant segment’s core operating results.

The other calculation of Adjusted EBITDA consists of revenues less direct cost of revenues and selling, general and administrative expense. As the other excluded items are not reflected in this calculation, they are excluded automatically and there is no need to make additional adjustments. This calculation results in the same Adjusted EBITDA amount and its utility and significance is as explained above.

Stock-based compensation recognized by IDT and other companies may not be comparable because of the variety of types of awards as well as the various valuation methodologies and subjective assumptions that are permitted under GAAP. Stock-based compensation is excluded from IDT’s calculation of non-GAAP net income and non-GAAP EPS because management believes this allows investors to make more meaningful comparisons of the operating results per share of IDT’s core business with the results of other companies. However, stock-based compensation will continue to be a significant expense for IDT for the foreseeable future and an important part of employees’ compensation that impacts their performance. 

In 1Q17, IDT recorded a foreign income tax benefit of $16.6 million from the release of the valuation allowance and full recognition of certain deferred tax assets, and in 4Q17, IDT recorded a federal income tax expense of $11.1 million from the increase in the valuation allowance on deferred tax assets. The income tax benefit and expense are excluded from IDT’s calculation of non-GAAP net income and non-GAAP EPS because neither was directly related to the current results of IDT’s core operations. These income tax benefit and expense are not expected to be reoccurring items.

Adjusted EBITDA, non-GAAP net income and non-GAAP EPS should be considered in addition to, not as a substitute for, or superior to, income (loss) from operations, cash flow from operating activities, net income, basic and diluted earnings per share or other measures of liquidity and financial performance prepared in accordance with GAAP. In addition, IDT’s measurements of Adjusted EBITDA, non-GAAP net income and non-GAAP EPS may not be comparable to similarly titled measures reported by other companies.

Following are reconciliations of Adjusted EBITDA, non-GAAP net income and non-GAAP EPS to the most directly comparable GAAP measure, which are, (a) for Adjusted EBITDA, income (loss) from operations for IDT’s reportable segments and net income for IDT on a consolidated basis, (b) for non-GAAP net income, net income and, (c) for non-GAAP EPS, basic and diluted earnings per share.

 

 

 

 

 

 

 

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SOURCE IDT Corporation