TLCO Teleconnect Inc (CE)

Teleconnect, Inc. (OTCBB:TLCO) announced an operational update to the company�s shareholders regarding the recently released 10-Q and significant balance sheet improvements. In the last 10-Q, the Company reported net income of $327,000 for the quarter ended March 31, 2007. In the six month period ended March 31, 2007, accounts payables have been reduced by 56% from $2.67 Million to $1.18 Million and accrued liabilities have been reduced by 35% from $992,000 to $646,000. Significantly, total assets increased 98% from $1.42 Million to $2.81 Million. In addition, Teleconnect, Inc. with the aid of majority shareholders, reduced its long-term debt by $1.49 Million, or 46%, in the six-month period ended March 31, 2007. Majority shareholders have extinguished $1.49 Million (US) in debt in exchange for equity at a conversion price of $0.10 per share, representing a 100% premium to the current market price. Teleconnect Inc. President, Gustavo Gomez said, �The results of our ongoing efforts to build profitability and increase shareholder value is reflected in the improved financial results for this past quarter ended March 31, 2007. Teleconnect�s plans for future growth have prompted our majority shareholders to show a strong vote of confidence in exchanging debt for equity under very attractive terms for the company.� The significantly improved balance sheet readies the company for future growth; next to the substantial organic growth the company is experiencing, Teleconnect is in advanced talks with potential acquisition candidates to faster reach its strategic goals. To be included in the corporate e-mail database for press releases and industry updates, please send an e-mail to ir@teleconnect.es About Teleconnect: Teleconnect Inc. through its wholly-owned subsidiary Teleconnect Comunicaciones S.A., a Spanish telecommunications company, is a major player in the prepaid telecoms industry in Spain. Teleconnect Inc. is traded on a U.S. stock exchange, the Over The Counter Bulletin Board (OTCBB) with trading symbol TLCO. Teleconnect provides commercial, residential and tourist users in Spain with a very competitive array of prepaid services. Teleconnect provides prepaid services for a highly defined market segment- customers who require individualized, multicultural and multilingual attention. http://www.teleconnect.es/en/index.jsp Forward Looking Statements: Except for the historical information contained herein, the statements in this press release are forward-looking statements that involve risks and uncertainties. Potential risks and uncertainties include, without limitation, continued competitive pressures in the marketplace; the effect competitive and economic factors and the Company's reaction to them may have on consumer and business buying decisions with respect to the Company's products; the ability of the Company to make timely delivery of new products and successful technological innovations to the marketplace; the continued availability of certain components and services essential to the Company's business currently obtained by the Company from sole or limited sources. More information on potential factors that could affect the Company's financial results is included from time to time in the Company's public reports filed with the SEC.