Thursday, March 6, 2008
Advant-e Corporation Announces Record
Revenue and Net Income for 2007
Company Reports 33% Increase in Revenue,
19% Increase in Net Income over Prior Year

DAYTON, Ohio, Thursday March 6, 2008 -- Advant-e Corporation (OTC Bulletin Board: ADVC), a provider of Internet-based Electronic Data Interchange services and electronic document management software and services today announced financial and operating results for the year ending December 31, 2007.

The Company reported record revenues for 2007 of $7,162,329, a 33% increase over revenues of $5,403,632 for 2006. The increase is attributable to continued growth of the Company’s internet-based EDI services and revenue from products and services sold by Merkur Group, Inc. which was acquired on July 2, 2007. Net income for 2007 was a record $1,022,679 or $.15 per share compared to $858,670 or $.13 per share in 2006.

Highlights of 2007 financial and operating results include:

  • Revenue Increased for the seventh consecutive year

  • Net Income Exceeded $1 million for first time and increased by 19%

  • Merkur Group Inc. Acquisition - On July 2, 2007 the Company acquired Merkur Group Inc. which contributed $1,086,724 to revenue in 2007 and net income of $58,300 before deducting non-cash charges pertaining to amortization of intangible assets of $27,108.

  • Continued Automotive related Web EDI Revenue Acceleration - Automotive and manufacturing Web EDI revenue increased by 25% and comprised 8% of Edict Systems revenue in 2007 compared to 7% in 2006.

ADVANT-E CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31, 2007 and 2006

2007

2006

Revenue

$7,162,329

398,561

Cost of revenue

2,498,850

1,677,937

Gross margin

4,663,479

3,725,695

Marketing, general and administrative expenses

3,147,344

2,453,883

Operating income

1,516,135

1,271,812

Other income (net)

77,431

87,862

Income before taxes

1,593,566

1,359,674

Income tax expense

570,887

501,004

Net income

1,022,679

858,670

Basic earnings per share

.15

.13

Diluted earnings per share
.15
.13

Weighted average shares outstanding

6,655,808

6,408,516

Weighted average shares outstanding,
assuming dilution
6,655,808
6,434,615
 

ADVANT-E CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS
At December 31, 2007 and 2006

2007

2006

Assets

Current Assets:

   Cash and cash equivalents

$2,039,447

2,209,782

   Short-term investments

292,151

274,434

   Accounts receivable, net

805,241

477,639

   Prepaid software maintenance costs

183,618

---

   Prepaid expenses and deposits
68,930
28,339

   Deferred income taxes

40,057

---

Total current assets

3,429,444

2,990,194

   Software development costs, net

194,238

247,621

   Property and equipment, net

433,658

386,697

   Goodwill

1,450,368

---

   Other intangible assets, net

468,644

---

Total assets

$6,006,352

3,624,512

Liabilities and Shareholders’ Equity

Current liabilities:

   Accounts payable

211,738

66,936

   Accrued salaries and other expenses

273,210

157,802

   Income taxes payable

112,700

109,642

   Deferred revenue

645,093

112,846

   Deferred income tax
---
53,119

Total current liabilities

1,242,741

500,345

Deferred income taxes

288,858

165,784

Total liabilities

1,531,599

666,129

Shareholders’ equity:

Common stock, $.001 par value; 20,000,000 shares authorized; 6,875,015 shares issued and 6,815,015 shares outstanding at December 31, 2007 and 6,478,714 outstanding at December 31, 2006

6,875

6,478

Paid-in capital

2,210,200

1,641,906

Retained earnings

2,332,678

1,309,999

Treasury stock at cost, 60,000 shares at December 31, 2007

75,000

---

Total shareholders’ equity

4,739,663

2,958,383

Total liabilities and shareholders’ equity

6,006,352

3,624,512

 
ADVANT-E CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (For the years ended December 31, 2007 and 2006)

2007

2006

Cash flows from operating activities:

Net income

$1,022,679

858,670

Adjustments to reconcile net income to net cash flows from operating activities:

Depreciation

228,614

153,113

Amortization of software development costs

68,746

124,498

Amortization of other intangible assets

42,356

---

Loss on disposal of assets
---
41,922

Deferred income taxes

(69,732)

60,703

Purchases of trading securities

(187,218)

(31,541)

Proceeds from sales of trading securities

183,694

28,393

Net realized gains on trading securities
(2,438)
(9,701)

Net unrealized gains on trading securities

(11,755)

(27,218)

Increase (decrease) in cash arising from changes in assets and liabilities:

   Accounts receivable

(12,192)

(126,157)

   Prepaid software maintenance costs

(11,306)

---

   Prepaid expenses and deposits

(2,182)

(3,211)

   Accounts payable

(41,084)

22,098

   Accrued salaries and other expenses

49,712

42,292

   Income taxes payable

833

(266,010)

   Deferred revenue

61,721

36,673

   Net cash flows from operating activities

1,320,448

904,524

Cash flows from investing activities:

Purchases of available-for-sale securities
---
(107,966)
Proceeds from sale of available-for-sale securities
---
90,086

Purchases of property and equipment

(242,125)

(311,654)

Software development costs

(15,363)

(219,018)

Purchase of Merkur Group, Inc.
(998,295)
---

Net cash flows from investing activities

(1,255,783)

(548,552)

Cash flows from financing activities:
Net payments on bank line of credit
(160,000)
---
Issuance of common stock
---
90,375
Purchase of treasury shares
(75,000)
---
Net cash flows from financing activities
(235,000)
90,375

Net increase (decrease) in cash and cash equivalents

(170,335)

446,347

Cash and cash equivalents,
beginning of year

2,209,782

1,763,435

Cash and cash equivalents,
end of year

2,039,447

2,209,782

Supplemental disclosures of cash flow items:

Income taxes paid

637,561

706,311

Non-cash transactions
Income taxes paid
568,692
---
 

About Advant-e
Advant-e, via its wholly owned and sole operating subsidiary Edict Systems, Inc., is a provider of Business-to-Business electronic commerce software and Internet-based applications specializing in Electronic Data Interchange (EDI) and XML-based solutions for recurring transactions. Advant-e specializes in horizontal transaction services via EnterpriseEC®, an Internet-based Electronic Business Transaction Network, and within specific vertical industries via web-based "vortals" including www.GroceryEC.com, www.RetailEC.com, www.CPGSupplier.com, www.LogisticsEC.com, and www.MfgEC.com.

 
 
The information in this news release includes certain forward looking statements that are based upon assumptions that in the future may prove not to have been accurate and are subject to significant risks and uncertainties, including statements to the future financial performance of the company. Although the company believes that the expectations reflected on its forward looking statements are reasonable, it can give no assurance that such expectations or any or its forward-looking statements will prove to be correct. Factors that could cause results to differ include, but are not limited to, successful performance of internal plans, product development and acceptance, the impact of competitive services and pricing, or general economic risks and uncertainties.