COMPANY PERFORMANCE. GlobalTel has continued to grow its volume despite the economic troubles in Asia, Russia and Brazil. During the past quarter the percentage of revenue coming from international callback services has increased over the percentage of revenue coming from US based domestic and international phone card services.

 DIVERSIFYING SERVICES and MARKETS. GlobalTel continues to diversify its services and markets. Two years ago GlobalTel International Callback was the only service offered. Today, GlobalTel services include GlobalTel Direct Dial, US based Phone Card Switching services for US domestic and international markets, GlobalTel USA 800 service for 1 + 800 dialing for US, Canadian and Puerto Rican customers, and Direct Dial Callback services for Bermuda.

 GlobalTel is also serving more markets than ever before, with customers in more than 110 countries. 1998 saw a significant increase of customers in the major economies of China, Germany and Japan, thanks to the efforts of agents in those countries as well as agents targeting those markets but do not live there.

 AGENT DIVERSIFICATION. Two years ago less than one-half of GlobalTel agents had email and less than five had web sites. Today, all but a few of you have email and many of you have web sites. In the past we have lost a few excellent and very successful agents who had most of their customers in their native country when the callback market was lost in that country. For example, Panama, Philippines and Bolivia. In all these countries callback became popular, and then was prohibited by the governments and the PTT's.

An important goal for 1999 will be to assist and encourage agents to market globally - to acquire customers in many countries. The purpose will be to make each agent's business more diversified, in markets and in services offered, and thus less vulnerable to economic and currency fluctuations, government trade barriers and technical interference by local PTT'S.

 IN COUNTRY SWITCHES TO ENABLE DIRECT DIALING. During the past quarter, Steve Williams, President and CEO and Ed Spina, GlobalTel Business Consultant, have installed a GlobalTel Switch in Bermuda which enables customers in that country to make direct-dial calls by way of an in-country toll-free number and PIN number. This has been working for several months now and is very popular and successful. Steve and Ed are currently working on leased lines for some countries and on "In Country Switches (Nodes), for Honduras and Paraguay.

 MARKETING INTERFERENCE FROM LOCAL PTTS. Our operations are interfered with in Venezuela, Panama, Nicaragua and Paraguay. In Venezuela and Panama the PTT’s block tones. In Nicaragua they send our customers a bill for services. In Paraguay the PTT interferes when they find someone using callback even though it is legal and approved by the Government. Agent Eric Ling, in Singapore notifies us, that Callback is now legal in Singapore, subject to a restriction against advertising the service. See Singapore government website: http://www.tas.gv.sg.

LANGUAGE PROMPTS IN FRENCH AND JAPANESE. Voice prompts are available now in (5) langages: English, Japanese, French, Portuguese & Spanish. New Russian prompts are scheduled for early January. Chinese, German and Italian, will follow soon.