Thursday May 17th, 2010
Advant-e Corporation Announces
First Quarter 2010 Results
Company Reports Net Income Increase of 13% and Revenue Increase of
2% over First Quarter of 2009

DAYTON, Ohio, May 17, 2009 -- Advant-e Corporation (OTC Bulletin Board: ADVC) today announced financial and operating results for the first quarter of 2010. The Company provides Internet-based Electronic Data Interchange services through Edict Systems, Inc. and sells electronic document management software and services through Merkur Group, Inc. Edict Systems and Merkur Group are wholly owned subsidiaries of Advant-e Corporation.

For the first quarter of 2010 the Company reported revenue of $2,193,821, a 2% increase, compared to revenue of $2,155,291 in the first quarter of 2009. Revenue from Edict Systems increased 10% in the quarter while revenue from Merkur Group decreased by 33%.

Net income for the first quarter of 2010 was $264,279, or $.004 per share, a 13% increase compared to net income of $234,677, or $.003 per share, for the same period in 2009.

Jason K. Wadzinski, Chairman of the Board and Chief Executive Officer, remarked, “Edict Systems performed well in the first quarter with revenue increases across all major product and service categories and an increase in net income of 31%. Merkur Group continues to struggle with sluggish software sales as potential customers continued to delay purchasing decisions as they deal with the uncertainty of today’s business climate. Due to Merkur’s recurring revenue from maintenance contracts on software sold in prior years as well as the Company’s efforts to control costs and expenses, Merkur contributed slightly to net income in the quarter.”

“I am cautiously optimistic that Merkur's results will improve during the remainder of 2010. The overall economy is showing signs of improvement and Merkur’s pipeline of opportunities is expanding for both software-based and on-demand services,” continued Mr. Wadzinski.

ADVANT-E CORPORATION AND SUBSIDIARIES CONSOLIDATED CONDENSED BALANCE SHEETS

March 31, 2010
(Unaudited)

December 31,
2009

Assets

   

Current Assets:

   

Cash and cash equivalents

$3,240,650

2,713,996

Accounts receivable, net

772,824

634,055

Prepaid software maintenance costs

197,635

162,507

Prepaid expenses and deposits

78,988

75,519

Prepaid income taxes

---

39,798

Deferred income taxes

163,056

139,144

   

Total current assets

4,453,153

3,765,019

Software development costs, net

188,119

149,956

Property and equipment, net

305,594

312,821

Goodwill

1,474,615

1,474,615

Other intangible assets, net

308,042

329,220

   

Total assets

$6,729,523

6,031,631

   

Liabilities and Shareholders’ Equity

   

Current liabilities:

   

Accounts payable

$154,087

115,546

Dividends payable

1,334,452

1,334,452

Accrued salaries and other expenses

304,942

283,360

Income taxes payable
120,840 ---

Deferred revenue

697,756

582,298

Total current liabilities

2,612,077

2,178,995

Deferred income taxes

261,555

261,024

   

Total liabilities

2,873,632

2,440,019

   

Shareholders’ equity:

   

Common stock, $.001 par value; 100,000,000 shares authorized; 66,951,010 shares issued and 66,722,590 shares outstanding

66,951

66,951

Paid-in capital

1,964,221

1,964,221

Retained earnings

1,852,911

1,588,632

Treasury stock at cost, 228,420 shares

(28,192)

(28,192)

   

Total shareholders’ equity

3,855,891

3,591,612

   

Total liabilities and shareholders’ equity

$6,729,523

6,031,631

   
ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

Three Months Ended
March 31,

2010

2009

Revenue

$2,193,821

2,155,291

Cost of revenue

933,984

899,659

   

Gross margin

1,259,837

1,255,632

Marketing, general and administrative expenses

859,101

887,285  

   

Operating income

400,736

368,347

Other income (expense), net

800

(19,649)

   

Income before income taxes

401,536

348,698

Income tax expense

137,257

114,021

   

Net income

264,279

234,677

   

Earnings per share – basic and diluted

0.004

0.003

   

Weighted average shares outstanding – basic and diluted

66,722,590

67,116,990

     


ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

Three Months Ended
March 31,

2010

2009

Cash flows from operating activities:

   

Net income

$264,279

234,677

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

   

Depreciation

55,480

62,767

Amortization of software development costs

20,446

20,445

Amortization of other intangible assets

21,178

21,178

Loss on disposal of property and equipment
800 ---

Deferred income taxes

(23,381)

(45,039)

Purchases of trading securities

---

(43,949)

Proceeds from sales of trading securities

---

49,828

Net unrealized loss on trading securities

---

4,667

Net realized loss on sale of trading securities

---

18,401

Increase (decrease) in cash arising from changes in assets and liabilities, net of effects of acquisition:

   

Accounts receivable

(138,769)

(129,200)

Prepaid software maintenance costs

(35,128)

(16,829)

Prepaid expenses and deposits

(3,469)

(5,240)

Prepaid income taxes

39,798

16,837

Accounts payable

38,541

1,802

Accrued salaries and other expenses

158,243

(37,891)

Income taxes payable

120,840

116,223

Deferred revenue

115,458

30,958

Net cash flows from operating activities

634,316

299,635

   

Cash flows from investing activities:

   

Purchases of property and equipment

(49,053)

(7,390)

Software Development Cost

(58,609)

---

Net cash flows from investing activities

(107,662)

(7,390)

   
Cash flows from financing activities:
   
Purchase of treasury shares
---
(3,920)
Net increase in cash and cash equivalents
526,654 288,325
   
Cash and cash equivalents, beginning of period
2,713,996
2,090,005
Cash and cash equivalents, end of period
3,240,650
2,378,330
   
Supplemental disclosures of cash flow items:
   
Income taxes paid
---
26,000
Non-cash transaction:  Retirement of shares

---

623

 

About Advant-e
Advant-e, via its wholly owned subsidiaries Edict Systems, Inc. and Merkur Group, Inc. is a provider of internet-based hosted Electronic Data Interchange (EDI) and electronic document management software and services. The Company helps businesses automate manual, paper-intensive processes via expanded use of EDI or by integrating directly with ERP/MRP systems.

Additional information about Advant-e Corporation can be found at www.Advant-e.com, www.EdictSystems.com, and www.MerkurGroup.com, or by contacting investor relations at (937) 429-4288. The company's email is [email protected].

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.