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Out with the old at E-Phone

By Phil Boeyen, ShareChat Business News Editor

Thursday 28th December 2000

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Loss-making internet kiosk company E-Phone (NZSE: EPH) appears keen to distance itself as quickly as possible from its troubled foray into the phone card market and is already brandishing its new name - EPH Global - on its web site.

Late in November the company announced it was selling its phone card business to Net-Tel but did not explain why.

The reason was revealed two weeks ago when it announced it had lost more than $3 million in the six months to the end of June, mainly from what it calls "significant advertising, marketing and promotional costs" in building the phone card business.

At the time of the sale the company said it would announce a new name to distance itself from the E-Phone brand, and in a statement accompanying its interim report said it would soon change its name to EPH (electronic payment holdings) Global, subject to shareholders' approval.

The company says the new name more closely identifies its business direction, and it is now banking on a system called AirCA$H to redeem it from the phone card debacle.

AirCA$H allows customers to initiate or recharge pre-pay cards at Eftpos terminals, although other services such as bill payments and international cash transfers are also possible.

E-Phone already has an agreement with fellow tech company Advantage to market and distribute the system in New Zealand, but an exclusive Asia-Pacific AirCA$H licensing agreement with US-based AirTime Technologies is believed to offer the most upside for the company.

According to E-Phone chief executive, Bob Barraket, AirCA$H will be the mainstay of the company's ongoing business and provides opportunities for international growth.

"...the AirCA$H products have major and immediate applications in the Asian markets," he said in the company's interim report. "A number of very promising new business contacts are in place, and field trials are tracking well."

The company's other main business continues to be its PatLoc terminal management system, which provides pre-paid access to public internet terminals in Australia and New Zealand.

E-Phone shareholders will be hoping the new name and direction will breathe some life into the company's languishing share price.

The stock has fallen from an 80-cent high in January to recent trades of around just 8 cents. That compares with the 25 cents a share the company received when it placed 5 million shares to private Australian and New Zealand investors in September.

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