Thursday, November 11th, 2010
Advant-e Corporation Announces
Third Quarter 2010 Results
Company Reports Record Revenue and Net Income; Net Income Increase of 37% and Revenue Increase of 10% over Third Quarter of 2009
DAYTON, Ohio, November 11, 2010 -- Advant-e Corporation (OTC Bulletin Board: ADVC) today announced financial and operating results for the third 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 third quarter of 2010 the Company reported revenue of $2,380,510, a 10% increase, compared to revenue of $2,158,016 in the third quarter of 2009. Revenue from Edict Systems increased by $204,554, and revenue from Merkur Group increased by $17,940.

Net income for the third quarter of 2010 was $434,231, or $.006 per share, a 37% increase compared to net income of $316,678, or $.005 per share, for the same period in 2009.

Jason K. Wadzinski, Chairman of the Board and Chief Executive Officer, remarked, “We achieved record revenue and record net income in the third quarter of 2010 on the strength of double-digit revenue growth from our Internet-based EDI services in the grocery and automotive sectors.  This quarter marks our 29th consecutive profitable quarter.  Merkur Group contributed to our profitability despite operating in a difficult sales environment.”

“We are continuing to direct much of our energy to growth opportunities in the health care and manufacturing industries, where potential customers have shown interest in our service offerings,” continued Mr. Wadzinski.  “At the same time, we expect continued growth in our core grocery and automotive markets.”

“I want to extend my thanks to all of our employees and business partners for their continuing efforts in helping us achieve this record-setting quarter.”


ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME (Unaudited)
Three Months Ended
September 30,
Six Months Ended
June 30,

 
2010
2009
2010
2009

Revenue               

$2,380,510
2,158,016
6,918,147
6,514,265

Cost of revenue   

913,522
858,522
2,769,072
2,688,352

Gross margin        

1,466,988
1,299,494
4,149,075
3,825,913

Marketing, general and administrative expenses           

803,341
801,355
2,478,280
2,526,143

Operating income

663,647
498,139
1,670,795
1,299,770

Other income, net

(2,964)
(3,376)
(959)
2,459

Income before income taxes              

660,683
494,763
1,669,836
1,302,229

Income tax expense             

226,452
178,085
571,486
439,611

Net income           

$434,231
316,678
1,098,350
862,618

Earnings per share – basic and diluted           

$.006
.005
.016
.013

Weighted average shares outstanding – basic and diluted             

66,722,590
66,746,560
66,722,590
66,919,220

ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
September 30, 2010
(Unaudited)
December 31,2009

Assets

 

 

Current Assets:

 

 

Cash and cash equivalents          

$3,353,328
2,713,996

Accounts receivable, net             

746,909
634,055

Prepaid software maintenance costs          

194,241
162,507

Prepaid expenses and deposits   

56,178
75,519

Prepaid income taxes     

—
39,798

Deferred income taxes   

167,588
139,144

Total current assets 

4,518,244
3,765,019

Software development costs, net     

267,937
149,956

Property and equipment, net             

250,970
312,821

Goodwill               

1,474,615
1,474,615

Other intangible assets, net              

265,686
329,220

Total assets         

$6,777,452
6,031,631

Liabilities and Shareholders’ Equity

Current liabilities:

Accounts payable         

$103,845
115,546

Dividend payable
667,226
1,334,452

Accrued salaries and other expenses         

322,612
146,699

Income taxes payable
35,901
—

Deferred revenue           

707,691
582,298

Total current liabilities             

1,837,275
2,178,995

Deferred income taxes        

250,215
261,024

Total liabilities     

2,087,490
2,440,019

Shareholders’ equity:

Common stock, $.001 par value; 100,000,000 shares authorized; 66,722,590 shares issued and outstanding at September 30, 2010; 66,951,010 shares issued and 66,722,590 shares outstanding at December 31, 2009
66,723
66,951

Paid-in capital           

1,936,257
1,964,221

Retained earnings    

2,686,982
1,588,632

Treasury stock at cost, 228,420 shares at December 31, 2009           

—
(28,192)

Total shareholders’ equity

4,689,962
3,591,612

Total liabilities and shareholders’ equity        

$6,777,452
6,031,631

ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
Nine Months Ended
September 30,
2010
2009
Cash flows from operating activities:
    
Net income
$1,098,350
862,618
Adjustments to reconcile net income to net cash flows from operating activities:       
Depreciation   
158,995
190,127
Amortization of software development costs           
30,669
61,338
Amortization of other intangible assets     
63,534
63,534
Loss on disposal of property and equipment
4,688
—
Deferred income taxes   
(39,253    )
(78,107)
Purchases of trading securities   
—
(99,922)
Proceeds from sales of trading securities  
—
327,193
Net unrealized gain on trading securities  
—
(34,546)
Net realized loss on sales of securities      
—
39,996
Increase (decrease) in cash arising from changes in assets and liabilities:          
Accounts receivable          
(112,854)
(13,448)
Prepaid software maintenance costs               
(31,734)
(9,468)
Prepaid expenses and deposits        
19,341
(19,308)
Prepaid income taxes          
39,798
(21,295)
Accounts payable              
(11,701)
(63,356)
Accrued salaries and other expenses              
175,913
16,868
Income taxes payable         
35,901
—
Deferred revenue
125,393
6,637
Net cash flows from operating activities         
1,557,040
1,228,861
Cash flows from investing activities:
    
Purchases of property and equipment  
(101,832)
(88,550)
Software development costs
(148,650)
(60,705)
Net cash flows from investing activities
(250,482)
(149,255)
Cash flows from financing activities:
Purchase of treasury shares   
—
(48,273)
Dividends paid
(667,226)
—
Net cash flows from financing activities
(667,226)
(48,273)
Net increase in cash and cash equivalents     
639,332
1,031,333
Cash and cash equivalents, beginning of period          
2,713,996
2,090,005
Cash and cash equivalents, end of period      
$3,353,328
3,121,338
Supplemental disclosures of cash flow items:
Income taxes paid     
$535,000
539,013
Non-cash transaction: retirement of shares         
28,192
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 info@edictsystems.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.