ATC Announcement, page-2

ATC - ASX Company Announcement
$tel1 THIS IS A PRIORITY ITEM
6 May 2002
Part 1/2
--------
ADVANTAGE TELECOMMUNICATIONS LIMITED
------------------------------------

HOMEX - Perth
-------------------------
Response to ASX Query re Appendix 4C

We acknowledge receipt of your letter dated 1 May 2002 and respond as
follows to the questions raised in relation to the Company's
quarterly report (Appendix 4C)

1. The working capital position of the Company is sufficient for its
operations having regard to factors affecting Q3 of 2001/2002
performance and anticipated performance for Q4 2001/2002. Performance
in Q3 2001/2002 was impacted by the restructure of the operations of
the Company associated with the move by the Company from mining to
telecomunications with the resultant associated expenditure. This
process has now been finalised and the Company is now dedicated to
its telecommunication activities. In addition the Company notes:

(a) the Appendix 4C does not include revenue earned during March 2002
of approximately A$300,000, which should be received during Q4
2001/2002.

(b) expenses for Q3 2001/2002 included one-off costs associated with
the reorganisation and restructure of the Company referred to above.
These costs are estimated at approximately A$400,000 and due to their
nature are not recurrent.

(c) revenue associated with operations is anticipated to increase
significantly during Q4 2001/2002. Consistent with this, revenue for
April 2002 of approximately A$500,000 has previously been announced
to ASX.

Oven the developmental stage of operations, the Company is reluctant
to provide estimations of future revenue and does so now only in
response to the specific request of the ASX to do so.

Internally budgeted revenue for Q4 2001/2002 is A$2,000,000. Budgeted
expenses for the period are A$2,500,000. The Company is confident
that subject to prevailing market conditions and any unforeseen
circumstances, these revenues and expenses will be achieved.

(d) the Company has received proposals for the placement of
securities to raise further capital should the need arise. The
Company is considering these proposals with no decision having been
made at this stage. The Company is also in the process of preparing a
Notice of Meeting to ratify previous share issues and the placement
of additional securities. Although the Company has not made any
decision regarding the placement of such securities, the availability
of the approval and funding provides additional flexibility to the
directors should the need for further capital arise

2. Please see our comments above. As previously disclosed to ASX, the
Company anticipates EBITDA positive results by Q1 2002/2003.
Consistent with this, the Company anticipates the operating position
of the Company to improve during Q4 2001/2002 as it moves towards
being EBITDA positive.

3. Expenses have been consistent with estimates. Revenues have been
delayed slightly due to lags in inter-connectivity late in Q2
2001/2002. This has resulted in income for April 2002 achieving the
levels set out above.

4. Please see our response to 3 above.

5. The Company is continuing to implement its business strategy.
Consistent with this (and as previously disclosed to ASX), the
Company has entered into approximately 50 inter-connect agreements
with customers and has commenced service provision to 16 of those
customers. Arrangements are being put in place to commence service
provision to the additional customers and it is anticipated this will
continue in Q4 2001/2002.

6. The Company is of the view that it is in compliance with Listing
Rule 3.1.

7. In light of the above information and explanation regarding the
content of the Appendix 4C, the Company remains of the view that it
has and will continue to comply with Listing Rule 12.2.

Should you require any further information please do not hesitate to
contact the writer.

J Palermo
COMPANY SECRETARY

MORE TO FOLLOW

h