Friday, March 18th, 2011
Advant-e Corporation Announces
Financial Results for 2010
Company Reports Record Revenue and Net Income; Revenue increased 8% and Net income increased 33% compared to 2009

DAYTON, Ohio, March 18, 2011 -- Advant-e Corporation (OTCQB: ADVC) today announced financial and operating results for the fiscal year ending December 31, 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.

The Company reported record revenue in 2010 of $9,302,611, an 8% increase compared to revenue of $8,649,199 in 2009.  Revenue for Edict Systems increased 9% and revenue from Merkur Group increased 2%.

The Company reported record net income for 2010 of $1,585,339, or $.024 per share, compared to $1,194,802, or $.018 per share, in 2009.  Net income in 2010 increased 33% compared to 2009.

Highlights of 2010 financial and operating results include:

  • Edict Systems Revenue Increased for the Tenth Consecutive Year – Revenue for Web EDI in the Grocery/Retail and Automotive sectors increased 11%.

  • Net Income Exceeded $1 million for Fourth Consecutive Year – 2010 marks the eighth consecutive year the company has reported a net profit.  The Company exceeded its goal of 20% pre-tax profitability 6 out of last 7 years.

  • Special Cash Dividend – The Company paid the final two installments of the special cash dividend declared in 2009 totaling $1,334,452, or $.02 per share.

  • Strong Cash Position at Year-end – Cash and cash equivalents of $2,963,172 provide sufficient liquidity for funding growth and other business and financial initiatives.

  • The Company had no Outstanding Bank or Other Long-Term Debt during 2010.

Mr. Jason K. Wadzinski, Chairman and CEO of Advant-e stated, “I am pleased to announce that Advant-e reported both top line revenue growth and net income growth in 2010, with contributions coming from both Edict Systems and Merkur Group.  Revenue growth from the Grocery/Retail and Automotive sectors, helped by a price increase, was particularly notable. Our net income growth was boosted by our continued emphasis on cost controls that we implemented during the economic downturn.”

“In 2011, we will be converting our Web EDI service to a new and superior platform that will allow us to add more functionality and greater value to our customers and their trading partners,” continued Mr. Wadzinski.  “This migration will take considerable time and resources and may temporarily increase our cost structure during the conversion.”

“I am pleased with our 2010 results and would like to thank everyone at Edict and Merkur for their hard work and focus on our continued success.”

ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
December 31, 2010 and 2009

2010

2009

Assets

   

Current Assets:

   

Cash and cash equivalents

$2,963,172

$2,713,996

Short-term investments

Accounts receivable, net

743,020

634,055

Prepaid software maintenance costs

174,013

162,507

Prepaid expenses and deposits

99,234

75,519

Prepaid income taxes

39,798

Deferred income taxes

153,643

139,144

   

Total current assets

4,133,082

3,765,019

Software development costs, net

308,832

149,956

Property and equipment, net

228,121

312,821

Goodwill

1,474,615

1,474,615

Other intangible assets, net

244,508

329,220

   

Total assets

$6,389,158

$6,031,631

   

Liabilities and Shareholders’ Equity

   

Current liabilities:

   

Accounts payable

$79,986

$115,546

Income taxes payable

33,619

Dividends payable

1,334,452

Accrued salaries and other expenses

180,311

146,699

Deferred revenue

673,810

582,298

   

Total current liabilities

967,726

2,178,995

Deferred income taxes

244,481

261,024

   

Total liabilities

1,212,207

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 at December 31, 2009; 20,000,000 shares authorized, 6,738,261 shares issued and 6,713,919 shares outstanding at December 31, 2008

66,723

66,951

Paid-in capital

1,936,257

1,964,221

Retained earnings

3,173,971

1,588,632

Treasury stock at cost, 27,342 and 24,342 shares at March 31, 2009 and December 31, 2008, respectively

(28,192)

   

Total shareholders’ equity

5,176,951

3,591,612

   

Total liabilities and shareholders’ equity

$6,389,158

$6,031,631

ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31, 2010 and 2009

2010

2009

Revenue

$9,302,611

$8,649,199

Cost of revenue

3,660,685

3,561,780

   

Gross margin

5,641,926

5,087,419

Marketing, general and administrative expenses

3,237,337

3,294,187

   

Operating income

2,404,589

1,793,232

Other income (expense), net

1,582

5,007

   

Income before income taxes

2,404,589

1,798,239

Income tax expense

820,832

603,437

   

Net income

1,585,339

1,194,802

   

Earnings per share – basic and diluted

$0.024

$0.018

   

Weighted average shares outstanding – basic and diluted

66,722,590

66,869,669

ADVANT-E CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 2010 and 2009

2009

2009

Cash flows from operating activities:

   

Net income

$1,585,339

$1,194,802

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

   

Depreciation

203,552

257,340

Amortization of software development costs

30,669

81,784

Amortization of other intangible assets

84,712

84,712

Loss on disposal of assets

4,688

Deferred income taxes

(31,042)

(61,627)

Purchases of trading securities

(99,922)

Proceeds from sales of trading securities

327,193

Net realized (gain) loss on sales of securities

(34,546)

Net unrealized loss on trading securities

39,996

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

   

Accounts receivable

(108,965)

65,040

Prepaid software maintenance costs

(11,506)

(6,480)

Prepaid expenses and deposits

(23,715)

(1,158)

Prepaid income taxes

39,798

(22,961)

Accounts payable

(35,560)

(91,828)

Accrued salaries and other expenses

33,612

(136,661)

Income taxes payable

33,619

Deferred revenue

91,512

(1,379)

Net cash flows from operating activities

1,896,713

1,594,305

   

Cash flows from investing activities:

   

Purchases of property and equipment

(123,540)

(135,516)

Software Development Cost

(189,545)

(119,287)

Net cash flows from investing activities

(313,085)

(254,803)

   
Cash flows from financing activities:
   
Purchase of treasury shares
(48,285)
Dividends paid
(1,334,452)
(667,226)
Net cash flows from financing activities
(1,334,452)
(715,511)
   
Net increase in cash and cash equivalents
249,176
623,991
Cash and cash equivalents, beginning of year
2,713,996
2,090,005
Cash and cash equivalents, end of year
2,963,172
2,713,996
   
Supplemental disclosures of cash flow items:
   
Income taxes paid
778,417
688,024
Non cash transactions:
   
Retirement of shares
28,192
56,028
Dividends payable in 2010

1,334,452

Capitalized retained earnings resulting from stock split

60,256

 

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.