News

TORONTO, July 26, 2017 – Tucows Inc. (NASDAQ: TCX, TSX: TC) plans to report its second quarter fiscal 2017 financial results via news release on Tuesday, August 8, 2017 at approximately 4:05 p.m. (ET). Tucows management will host a conference call on the same day at 5:00 p.m. (ET) to discuss the results and the outlook for the company.

Participants can join the call by dialing 1-888-231-8191 or 647-427-7450. Participants can also access the conference call via the Internet at https://www.tucows.com/investors.

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 1-855-859-2056 or 416-849-0833 and enter the pass code 59387346 followed by the pound key. The telephone replay will be available until Tuesday, August 15, 2017 at midnight. To access the archived conference call as an MP3 via the Internet, go to https://www.tucows.com/investors.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) and Enom (http://www.enom.com) manage a combined 29 million domain names and millions of value-added services through a global reseller network of over 40,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

Tucows, Ting, OpenSRS, Enom and Hover are registered trademarks of Tucows Inc. or its subsidiaries.

Contact:

Lawrence Chamberlain
(416) 519-4196
lawrence.chamberlain@loderockadvisors.com

– Quarter Features Outsized Customer and Revenue Growth On Domains and Ting Mobile Alongside Solid Financial Performance –

TORONTO, May 9, 2017 – Tucows Inc. (NASDAQ:TCX, TSX:TC), a provider of network access, domain names and other Internet services, today reported its financial results for the first quarter ended March 31, 2017. All figures are in U.S. dollars.

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TORONTO, May 01, 2017 — Tucows Inc. (NASDAQ:TCX) (TSX:TC) plans to report its first quarter fiscal 2017 financial results via news release on Tuesday, May 9, 2017 at approximately 4:05 p.m. (ET). Tucows management will host a conference call on the same day at 5:00 p.m. (ET) to discuss the results and the outlook for the company.

Participants can join the call by dialing 1-888-231-8191 or 647-427-7450. Participants can also access the conference call via the Internet at https://www.tucows.com/investors.

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 1-855-859-2056 or 416-849-0833 and enter the pass code 16809774 followed by the pound key. The telephone replay will be available until Tuesday, May 16, 2017 at midnight. To access the archived conference call as an MP3 via the Internet, go to https://www.tucows.com/investors.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) and Enom (http://www.enom.com) manage a combined 29 million domain names and millions of value-added services through a global reseller network of over 40,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

Tucows, Ting, OpenSRS, Enom and Hover are registered trademarks of Tucows Inc. or its subsidiaries.

Contact:

Michael Goldstein
(416) 538-5451
mgoldstein@tucows.com

TORONTO, March 17, 2017 — Tucows Inc. (NASDAQ:TCX) (TSX:TC), a provider of network access, domain names and other Internet services, announced today that Michael Cooperman, 65, will retire as Chief Financial Officer effective April 1, 2017 following 18-years of service with the Company. Cooperman will remain with the Company in a senior advisory role to ensure a seamless transition.

Tucows’ Board of Directors today appointed Dave Singh to succeed Mr. Cooperman as Executive Vice President and Chief Financial Officer. Mr. Singh has served as Vice President Finance at Tucows since February 2016.

“Mike and I have had a strong and fruitful working relationship for a number of years,” said Tucows President and CEO, Elliot Noss. “When Mike started in 1999, the goal was to see if we could monetize shareware distribution. Last month, we purchased an $80 million company and laid miles of optical fiber. We simply could not have had the success we have had without him. I am forever grateful for his partnership, wisdom and grit and for helping and supporting me when I most needed it.”

Noss added, “I am also very grateful that Mike has made it his responsibility to hand-pick, train and oversee his successor. As a result, we enter the Dave Singh era with the same confidence we have enjoyed for the past 18 years.”

“My career at Tucows has been a rewarding and enriching experience,” said Mike Cooperman, Tucows outgoing CFO. “The Company is in a strong position to continue growing and driving value for investors, and I am confident that Dave will continue to build on this momentum as CFO.”

Mr. Singh, 42, will report to Mr. Noss as Tucows CFO. Prior to joining Tucows, Mr. Singh spent eight years at KPMG in Vancouver, primarily focused on public company audits in the technology field. After KPMG, Mr. Singh joined TELUS and held a number of progressive roles, including Director of TELUS Financial Reporting and Analysis, Director of Retail and most recently CFO of TELUS International, TELUS’ outsourcing division.

Mr. Singh is a Chartered Professional Accountant with the Institute of Chartered Professional Accountants of BC. He is a graduate of the Transportation and Logistics Management program from the Sauder School of Business at the University of British Columbia and holds a joint Executive MBA from Schulich School of Business and Northwestern University.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) and Enom (http://www.enom.com) manage a combined 29 million domain names and millions of value-added services through a global reseller network of over 40,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

TUCOWS® is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Contact:
Conrad Seguin
NATIONAL Equicom
(416) 586-1951
cseguin@national.ca

TORONTO, March 01, 2017 — Tucows Inc. (NASDAQ:TCX) (TSX:TC) today announced that its Board of Directors has approved a stock buyback program to repurchase from time to time up to $40 million of its common stock in the open market.

The new $40 million buyback program will commence March 1, 2017 and will terminate on or before February 28, 2018.

Purchases for the new $40 million buyback program will be made exclusively through the facilities of the NASDAQ Capital Market.

All shares purchased by Tucows under the stock buyback program will be retired and returned to treasury.

The timing and exact number of common shares purchased will be at Tucows’ discretion and will depend on available cash and market conditions. Tucows may suspend or discontinue the repurchases at any time, including in the event Tucows would be deemed to be making an acquisition of its own shares under Rule 13e-3 of the Securities Exchange Act of 1934, as amended. Subject to applicable securities laws and stock exchange rules, all purchases will occur through the open market and may be in large block purchases. Tucows does not intend to purchase its shares from its management team or other insiders.

The purchase will be funded from available working capital and existing credit facilities. As of March 1, 2017, Tucows had 10,469,406 common shares outstanding.

NO STOCK EXCHANGE, SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY HAS APPROVED OR DISAPPROVED THE INFORMATION CONTAINED HEREIN.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) and Enom (http://www.enom.com) manage a combined 29 million domain names and millions of value-added services through a global reseller network of over 40,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

This news release contains, in addition to historical information, forward-looking statements related to the proposed stock buyback program, including the timing, manner and total number of shares to be purchased under the proposed stock buyback program. Such statements are based on management’s current expectations and are subject to a number of uncertainties and risks, which could cause actual results to differ materially from those described in the forward-looking statements. Information about potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the Securities and Exchange Commission. All forward-looking statements included in this document are based on information available to Tucows as of the date of this document, and except to the extent Tucows may be required to update such information under any applicable securities laws, Tucows assumes no obligation to update such forward-looking statements.

TUCOWS is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Contact:

Lawrence Chamberlain
NATIONAL Equicom
(416) 848-1457
lchamberlain@national.ca

– Solid Financial Performance in Fourth Quarter Contributes to Record EPS for 2016 of $1.53 –

TORONTO, February 7, 2017 – Tucows Inc. (NASDAQ:TCX, TSX:TC), a provider of network access, domain names and other Internet services, today reported its financial results for the fourth quarter ended December 31, 2016. All figures are in U.S. dollars.

Summary Financial Results

(In Thousands of US Dollars, Except Per Share Data)

1. This Non-GAAP financial measure is described below and reconciled to GAAP net income in the accompanying table. Tucows has revised its definition of Adjusted EBITDA as detailed in the description below and the table reconciling Adjusted EBITDA to GAAP net income.

Summary of Revenues and Gross Margin
(In Thousands of US Dollars)

“A strong fourth quarter contributed to a record financial performance for 2016, driven by continued top line and gross margin growth in both our Ting Mobile and Domain Services businesses as we continue to benefit from the significant operating leverage in our business,” said Elliot Noss, President and Chief Executive Officer, Tucows Inc. “Revenue for fourth quarter grew 9% year-over year to just under $49 million, and for the year grew 11% to just under $190 million. Earnings per share for the quarter decreased 7% year-over-year to $0.27 while growing 47% for the full year to $1.53.”

“As importantly, each of our businesses contributed just what we would have hoped to the overall business strategy,” added Mr. Noss. “Domain Services achieved greater scale and efficiency with the acquisition and successful integration of Melbourne IT’s international wholesale domain reseller channel. With the very recent acquisition of Enom and its expected operating synergies to come over the next 24 months, we anticipate further efficiencies in the future. Ting Mobile delivered outstanding growth, finishing the year with a run rate of over $35 million in annual gross margin. And Ting Internet took significant strides toward future contribution as we added new towns, expanded our networks, drove demand and optimized our operations and processes.”

Mr. Noss added, “We begin 2017 in a tremendous position to continue to grow our bottom line and invest in our priorities.”

Financial Results

Net revenue for the fourth quarter of 2016 increased 9% to 48.8 million from $44.7 million for the fourth quarter of 2015.

Net income for the fourth quarter of 2016 decreased to $2.8 million, or $0.27 per share, from $3.1 million, or $0.29 per share, for the fourth quarter of 2015. Net income for the fourth quarter of 2016 was negatively impacted during the quarter by one-time items totaling $1.0 million related to the Enom acquisition and the Ting Mobile business. Adjusted EBITDA¹ for the fourth quarter of 2016 increased to $7.3 million from $5.5 million for the fourth quarter of 2015.

Cash and cash equivalents at the end of the fourth quarter of 2016 were $15.1 million compared with $10.5 million at the end of the third quarter of 2016 and $7.7 million at the end of the fourth quarter of 2015. The increase relative to the third quarter of 2016 was primarily the result of cash provided by operating activities of $8.9 million, which was partially offset by a further investment of $4.0 million in property and equipment, primarily for the continued build out of the Ting Internet footprint and scheduled loan repayments of $0.3 million.

Notes:

1. Adjusted EBITDA

Tucows reports all financial information required in accordance with United States generally accepted accounting principles (GAAP). Along with this information, to assist financial statement users in an assessment of our historical performance, the Company typically disclose and discuss a non-GAAP financial measure, adjusted EBITDA, on investor conference calls and related events that exclude certain non-cash and other charges as the Company believes that the non-GAAP information enhances investors’ overall understanding of our financial performance.

The Company believes that the provision of this supplemental non-GAAP measure allows investors to evaluate the operational and financial performance of the Company’s core business using similar evaluation measures to those used by management. The Company uses adjusted EBITDA to measure its performance and prepare its budgets. Since adjusted EBITDA is a non-GAAP financial performance measure, the Company’s calculation of adjusted EBITDA may not be comparable to other similarly titled measures of other companies; and should not be considered in isolation, as a substitute for, or superior to measures of financial performance prepared in accordance with GAAP. Because adjusted EBITDA is calculated before recurring cash charges, including interest expense and taxes, and is not adjusted for capital expenditures or other recurring cash requirements of the business, it should not be considered as a liquidity measure. Non-GAAP financial measures do not reflect a comprehensive system of accounting and may differ from non-GAAP financial measures with the same or similar captions that are used by other companies and/or analysts and may differ from period to period. The Company endeavors to compensate for these limitations by providing the relevant disclosure of the items excluded in the calculation of adjusted EBITDA to net income based on U.S. GAAP, which should be considered when evaluating the Company’s results. Tucows strongly encourages investors to review its financial information in its entirety and not to rely on a single financial measure.

The Company’s adjusted EBITDA definition excludes depreciation, amortization of intangible assets, income tax provision, interest expense, interest income, stock-based compensation, asset impairment, gains and losses from unrealized foreign currency transactions and infrequently occurring items, including acquisition and integration costs. Gains and losses from unrealized foreign currency transactions removes the unrealized effect of the change in the mark-to-market values on outstanding unhedged foreign currency contracts, as well as the unrealized effect from the translation of monetary accounts denominated in non-U.S. dollars to U.S. dollars.

Prior year Adjusted EBITDA amounts presented herein have been recast to reflect adjusted EBITDA definitional changes described in the Company’s Form 10-Q Quarterly Report for the three months ended September 30, 2016.

During 2016, the Company identified an immaterial error that affects the classification of certain marketing program costs. Prior to the third quarter of fiscal 2016, the Company recorded the cost for certain marketing credits as Sales and marketing expense which should have been recorded as a reduction in Net revenue. The discussion presented here correctly reflect these marketing credits as a reduction in Net Revenues for all current and comparative periods. This resulted in a decrease in Net Revenues, and a corresponding decrease in Sales and marketing expenses of $0.3 million and $1.3 million for the three months and year ended December 31, 2015.

Conference Call

Tucows management will host a conference call today, Tuesday, February 7, 2017 at 5:00 p.m. (ET) to discuss the Company’s fourth quarter 2016 results. Participants can access the conference call by dialing 1-888-231-8191 or 647-427-7450 or via the Internet at https://www.tucows.com/investors.

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 416-849-0833 or 1-855-859-2056 and enter the passcode 58593654 followed by the pound key. The telephone replay will be available until Tuesday, February 14, 2017 at midnight. To access the archived conference call as an MP3 via the Internet, go to https://www.tucows.com/investors.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) and Enom (http://www.enom.com) manage a combined 29 million domain names and millions of value-added services through a global reseller network of over 40,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995 including statements regarding our expectations regarding our future financial results and, including, without limitation, our expectation regarding our ability to manage realized gains/losses from foreign currency contracts. These statements are based on management’s current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Information about other potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the Securities and Exchange Commission. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All forward-looking statements are based on information available to Tucows as of the date they are made. Tucows assumes no obligation to update any forward-looking statements, except as may be required by law.

TUCOWS® is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Contact:

Lawrence Chamberlain
NATIONAL Equicom
(416) 848-1457
lchamberlain@national.ca

TORONTO, January 24, 2017 – Tucows Inc. (NASDAQ: TCX, TSX: TC) plans to report its fourth quarter fiscal 2016 financial results via news release on Tuesday, February 7, 2017 at approximately 4:05 p.m. (ET). Tucows management will host a conference call on the same day at 5:00 p.m. (ET) to discuss the results and the outlook for the company.

Participants can join the call by dialing 1-888-231-8191 or 647-427-7450. Participants can also access the conference call via the Internet at https://www.tucows.com/investors.

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 1-855-859-2056 or 416-849-0833 and enter the pass code 58593654 followed by the pound key. The telephone replay will be available until Tuesday, February 14, 2017 at midnight. To access the archived conference call as an MP3 via the Internet, go to https://www.tucows.com/investors.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) manages nearly 15 million domain names and millions of value-added services through a global reseller network of over 13,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows' corporate website (https://www.tucows.com).

Tucows, Ting, OpenSRS and Hover are registered trademarks of Tucows Inc. or its subsidiaries.

Contact:
Lawrence Chamberlain
NATIONAL Equicom
(416) 848-1457
lchamberlain@national.ca

— Combined Entity Will Be The Second Largest Domain Registrar In The World —

TORONTO, January 20, 2017 – Tucows Inc. (NASDAQ:TCX, TSX:TC), a provider of network access, domain names and other Internet services, announced that it has signed a definitive agreement to acquire wholesale domain name registrar eNom from Rightside Group, Ltd. (NASDAQ: NAME). The transaction is expected to close later today.

Tucows will pay $83.5 million and the transaction is expected to be immediately accretive to earnings. The acquisition will be funded through an amendment increasing Tucows’ existing credit facility to a total of $140 million.

The acquisition of eNom will add 14.5 million domains under management and 28,000 active resellers. That will give Tucows a total network of over 40,000 resellers globally and 29 million domains under management, making it the second largest domain registrar in the world.

“For years, eNom and OpenSRS have been the two leading registrars primarily focused on the needs of resellers. This focus means these businesses fit very well together,” said David Woroch, Tucows’ Executive Vice President of Domains. “The acquisition keeps eNom resellers where they will be well understood, well valued and well served and creates tremendous value for Tucows and resellers on both sides through efficiency and scale.”

Elliot Noss, Tucows’ CEO added, “This industry has changed so much since Tucows and eNom each launched wholesale registrar services over fifteen years ago and .com, .net and .org essentially represented the namespace. It is a lot more challenging and complex now. At the same time, it is more mature and much more competitive. Scale is absolutely critical. This is a rare deal that gives Tucows and its investors exactly that while offering an immediate cash on cash return.”

NOTE TO INVESTORS: We know that releasing this transaction on a Friday morning, especially this particular Friday morning, is not ideal. We apologize for that. These things sometimes cannot be helped.

Conference Call

Tucows management will host a conference call today, Friday, January 20, 2017 at 11 am (ET) to discuss this announcement. Participants can access the conference call by dialing (888) 231-8191 or (647) 427-7450 or via the Internet at https://www.tucows.com/investors.

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 1-855-859-2056 or 416-849-0833 and enter the passcode 56195754 followed by the pound key. The telephone replay will be available until January 27, 2017 at midnight ET. To access the archived conference call as an MP3 via the Internet, go to https://www.tucows.com/investors.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) manages nearly 15 million domain names and millions of value-added services through a global reseller network of over 13,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

About Rightside

Rightside® inspires and delivers new possibilities for consumers and businesses to define and present themselves online. The company, with its affiliates, is a leading provider of domain name services, offering one of the industry’s most comprehensive platforms for the discovery, registration, usage, and monetization of domain names. Headquartered in Kirkland, WA, Rightside has offices in North America, Europe, and Australia. For more information please visit www.rightside.co.

This news release contains forward-looking statements related to the acquisition, including, without limitation, the expected closing of the acquisition, the expectation that the transaction will be immediately accretive to earnings, the funding through an increase under Tucows’ existing credit facility, and the effect of the acquisition. Such statements are based on management’s current expectations and are subject to a number of uncertainties and risks, which could cause actual results to differ materially from those described in the forward-looking statements. Information about potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the Securities and Exchange Commission. All forward-looking statements included in this document are based on information available to Tucows as of the date of this document, and except to the extent Tucows may be required to update such information under any applicable securities laws, Tucows assumes no obligation to update such forward-looking statements.

TUCOWS® is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Media Contact:
Gustavo Arruda
garruda@tucows.com

Investor Contact:
Lawrence Chamberlain
416-848-1457
lchamberlain@national.ca

Brings a wealth of relevant experience and a lot of cool friends

TORONTO, Jan. 12, 2017 — Tucows Inc. (NASDAQ:TCX) (TSX:TC), a provider of network access, domain name and other Internet services, today announced that Brad Burnham has joined its Board of Directors.

Mr. Burnham began his career in information technology with AT&T in 1979. He held a variety of sales, marketing and business development positions there until 1990 when he spun Echo Logic out of Bell Laboratories. He joined AT&T Ventures in 1993, co-founded digital advertising pioneer TACODA in 2001 and then co-founded Union Square Ventures with Fred Wilson in 2003.

Union Square Ventures was the first institutional investor in an exceptionally large number of companies that went on to become important players on the Internet – companies like Twitter, Etsy, Zynga and Kickstarter. Mr. Burnham personally led their investments in Tumblr, Indeed, Meetup, and, more recently Stack Overflow and Duolingo.

“Tucows, with Ting in particular, has huge ambitions right now,” explained Tucows CEO Elliot Noss. “We are providing core services in mobile and fixed Internet and competing with some of the largest, most successful companies in the world, like AT&T and Comcast. But we want to challenge pricing conventions, offer far better experiences, contribute more to local communities and create greater returns for investors. In that regard, we are holding ourselves up against the kinds of companies in Brad’s portfolio. We want to be that usable, delightful, bold and innovative. Brad might be singularly qualified to help us with that challenge.”

Mr. Burnham added, “I am a huge fan of decentralized, bottom up, start-up innovation. I feel fortunate to have been able to work with companies that fundamentally transformed markets. I think Tucows has an exceptional opportunity to change the way we think about access to the Internet.”

The addition of Mr. Burnham expands Tucows’ Board to seven Directors.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) manages nearly 15 million domain names and millions of value-added services through a global reseller network of over 13,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

Contact:
Lawrence Chamberlain
NATIONAL Equicom
(416) 848-1457
lchamberlain@national.ca

TORONTO, November 7, 2016 – Tucows Inc. (NASDAQ:TCX, TSX:TC), a provider of network access, domain names and other Internet services, today reported its financial results for the third quarter ended September 30, 2016. All figures are in U.S. dollars.

Summary Financial Results

(In Thousands of US Dollars, Except Per Share Data)

1. This Non-GAAP financial measure is described below and reconciled to GAAP net income in the accompanying table. Tucows has revised its definition of Adjusted EBITDA as detailed in the description below and the table reconciling Adjusted EBITDA to GAAP net income.

Summary of Revenues and Gross Margin
(In Thousands of US Dollars)

“Continuing growth in both Ting Mobile and our Domain Services business propelled Tucows to a record quarter for both the top and bottom lines,” said Elliot Noss, President and Chief Executive Officer, Tucows Inc. “We continue to reap the benefits of the significant operating leverage in the business. Overall revenue was up 11% year-over-year, while net income grew 50% to a record $4.7 million, or $0.45 per share, and adjusted EBITDA1 increased 48% to a record $8.6 million.”

“As Ting Mobile and Domain Services continue to drive our near-term financial performance, Ting Internet takes positive steps every day toward future contribution to our business. In Q2, we expanded our fiber network in Charlottesville, Virginia, began construction in Holly Springs, North Carolina and saw Westminster, Maryland launch the next wave of construction on its municipal fiber network. We also announced that Centennial, Colorado would be our next and largest Ting town to date, with a population over 100,000, and began taking pre-orders there immediately.”

Net revenue for the third quarter of 2016 increased 11% to a record $49.1 million from $44.3 million for the third quarter of 2015.
Net income for the third quarter of 2016 increased to a record $4.7 million, or $0.45 per share, from $3.2 million, or $0.29 per share, for the third quarter of 2015. Adjusted EBITDA1 for the third quarter of 2016 increased to $8.6 million from $5.8 million for the third quarter of 2015.

Cash and cash equivalents at the end of the third quarter of 2016 were $10.5 million compared with $5.9 million at the end of the second quarter of 2016 and $11.9 million at the end of the third quarter of 2015. The increase relative to the second quarter of 2016 was primarily the result of cash provided by operating activities of $5.0 million, as well as an increase in the amount outstanding on the bank loan of $1.9 million, which partially offset by a further investment of $2.1 million in property and equipment, primarily for the continued build out of the Ting Internet footprint.

NOTES:

¹ Adjusted EBITDA

Tucows reports all financial information required in accordance with United States generally accepted accounting principles (GAAP). Along with this information, to assist financial statement users in an assessment of our historical performance, the Company typically disclose and discuss a non-GAAP financial measure, adjusted EBITDA, on investor conference calls and related events that exclude certain non-cash and other charges as the Company believes that the non-GAAP information enhances investors’ overall understanding of our financial performance.

The Company believes that the provision of this supplemental non-GAAP measure allows investors to evaluate the operational and financial performance of the Company’s core business using similar evaluation measures to those used by management. The Company uses adjusted EBITDA to measure its performance and prepare its budgets. Since adjusted EBITDA is a non-GAAP financial performance measure, the Company’s calculation of adjusted EBITDA may not be comparable to other similarly titled measures of other companies; and should not be considered in isolation, as a substitute for, or superior to measures of financial performance prepared in accordance with GAAP. Because adjusted EBITDA is calculated before recurring cash charges, including interest expense and taxes, and is not adjusted for capital expenditures or other recurring cash requirements of the business, it should not be considered as a liquidity measure. Non-GAAP financial measures do not reflect a comprehensive system of accounting and may differ from non-GAAP financial measures with the same or similar captions that are used by other companies and/or analysts and may differ from period to period. The Company endeavors to compensate for these limitations by providing the relevant disclosure of the items excluded in the calculation of adjusted EBITDA to net income based on U.S. GAAP, which should be considered when evaluating the Company’s results. Tucows strongly encourages investors to review its financial information in its entirety and not to rely on a single financial measure.

The Company’s adjusted EBITDA definition excludes depreciation, amortization of intangible assets, income tax provision, interest expense, interest income, stock-based compensation, asset impairment, gains and losses from unrealized foreign currency transactions and infrequently occurring items. Gains and losses from unrealized foreign currency transactions removes the unrealized effect of the change in the mark-to-market values on outstanding unhedged foreign currency contracts, as well as the unrealized effect from the translation of monetary accounts denominated in non-U.S. dollars to U.S. dollars.

Prior year Adjusted EBITDA amounts presented herein have been recast to reflect adjusted EBITDA definitional changes described in the Company’s Form 10-Q Quarterly Report for the three months ended September 30, 2016.

During the financial statement close for the three months ended September 30, 2016, the Company identified an immaterial error that affects the classification of certain marketing program costs. Prior to the third quarter of fiscal 2016, the Company recorded the cost for certain marketing credits as Sales and marketing expense which should have been recorded as a reduction in Net revenue. The discussion presented here correctly reflect these marketing credits as a reduction in Net Revenues for all current and comparative periods. This resulted in a decrease in Net Revenues, and a corresponding decrease in Sales and marketing expenses of $0.3 million and $0.9 million for the three months and nine months ended September 30, 2015. For the nine months ended September 30, 2016, Net revenues and Sales and marketing expenses reflect a reduction of $1.1 million for the reclassification of credits for the first six months of fiscal 2016.

Conference Call

Tucows management will host a conference call today, Monday, November 7, 2016 at 5:00 p.m. (ET) to discuss the Company’s third quarter 2016 results. Participants can access the conference call by dialing 1-888-231-8191 or 647-427-7450 or via the Internet at https://www.tucows.com/investors.

For those unable to participate in the conference call at the scheduled time, it will be archived for replay both by telephone and via the Internet beginning approximately one hour following completion of the call. To access the archived conference call by telephone, dial 416-849-0833 or 1-855-859-2056 and enter the passcode 3037132 followed by the pound key. The telephone replay will be available until Monday, November 14, 2016 at midnight. To access the archived conference call as an MP3 via the Internet, go to https://www.tucows.com/investors.

About Tucows

Tucows is a provider of network access, domain names and other Internet services. Ting (https://ting.com) delivers mobile phone service and fixed Internet access with outstanding customer support. OpenSRS (http://opensrs.com) manages nearly 15 million domain names and millions of value-added services through a global reseller network of over 13,000 web hosts and ISPs. Hover (http://hover.com) makes it easy for individuals and small businesses to manage their domain names and email addresses. More information can be found on Tucows’ corporate website (https://www.tucows.com).

This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995 including statements regarding our expectations regarding our future financial results and, including, without limitation, our expectation regarding our ability to manage realized gains/losses from foreign currency contracts. These statements are based on management’s current expectations and are subject to a number of uncertainties and risks that could cause actual results to differ materially from those described in the forward-looking statements. Information about other potential factors that could affect Tucows’ business, results of operations and financial condition is included in the Risk Factors sections of Tucows’ filings with the Securities and Exchange Commission. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. All forward-looking statements are based on information available to Tucows as of the date they are made. Tucows assumes no obligation to update any forward-looking statements, except as may be required by law.

TUCOWS® is a registered trademark of Tucows Inc. or its subsidiaries. All other trademarks and service marks are the properties of their respective owners.

Contact:

Lawrence Chamberlain
NATIONAL Equicom
(416) 848-1457
lchamberlain@national.ca