Adeptron Technologies Reports 2006 Financial Results

Adeptron Technologies Corporation, a specialist at delivering integrated product solutions and support to the global technology and electronics industry, today reports its fourth quarter financial results for the three-month period ended December 31, 2006 and annual financial results for the twelve-month period ended December 31, 2006. All dollar figures are reported in Canadian currency.

2006 Annual Financial Highlights:

- Total revenue increased by 15% to $43.8 million compared to $38.2 million in 2005

- Net earnings increased to $1.6 million compared to a loss of $0.4 million in 2005

- Earnings per diluted share increased to $0.05 compared to a loss of $0.01 in 2005

- EBITDA increased 230% to $3.3 million from $1 million in 2005

2006 Q4 Financial Highlights:

- Total revenues increased by 2% to $10.9 million compared to $10.7 million in fourth quarter 2005

- Net earnings doubled to $0.3 million compared to fourth quarter 2005 net income

- Earnings per diluted share increased to $0.01 compared to $0.00 in fourth quarter 2005

- EBITDA increased 80% to $0.9 million compared to $0.5 million in fourth quarter 2005

F. Michael Marti, President and Chief Executive Officer of Adeptron commented, "We are pleased to report a significant improvement in our year-over-year financial results for 2006 and on our management team's ability to execute against our 2006 plan that focused on revenue growth with continued profitability and the enhancement of the Company's balance sheet by increasing working capital. Adeptron has now reported five consecutive quarters of net income and at year-end had a working capital position of $4.8 million compared to a working capital deficiency of $2.1 million at the end of 2005."

Marti continued, "In 2006, our team accomplished year-over-year improvements in virtually every key financial category of our business. In 2007, the plan is to reinvest in the Company, including the recruiting of new management expertise and the setting of new focus and responsibilities for some existing members of the management team. This is intended to strengthen Adeptron's value proposition to its current and prospective customers. With these moves we are assembling the catalysts for Adeptron to effectively execute its organic business development strategy and other business expansion plans for 2007 and beyond. We are making these investments now with the objective of building increased longer-term profitability."

"As well in 2007, Adeptron's management team will continue to work on executing the Company's China strategy for improved supply chain and offshore manufacturing capabilities. In the last quarter of 2006 Adeptron began manufacturing product for a key customer through its offshore partners. In 2007, we expect to see the Company's volume of such offshore production increase," said Marti.

Revenue for 2006 was $43.8 million compared to $38.2 million in 2005, an increase of $5.6 million, or 15%. Revenue for the three month period ended December 31, 2006 ("fourth quarter") was $10.9 million compared to $10.7 million for the fourth quarter of 2005, an increase of $0.2 million, or 2%.

This revenue growth resulted in improvements in gross margin and the gross margin percentage for 2006 compared to 2005. Gross margin for 2006 improved to $7.7 million, an increase of $2.4 million over gross margin of $5.3 million in 2005. The gross margin percentage in 2006 of 17.6% compared favourably to the 13.8% gross margin percentage reported in 2005. Gross margin for the fourth quarter of 2006 improved to $2 million, an increase of $0.3 million over gross margin of $1.7 million for the fourth quarter of 2005. The gross margin percentage in the fourth quarter of 2006 of 18.2% compared favourably to the 15.6 % gross margin percentage reported in the fourth quarter of 2005.

Selling, general and administrative ("SG&A") expenses for 2006 were $5 million, $0.3 million higher compared to $4.7 million in 2005. SG&A expenses for the fourth quarters of 2006 and 2005 respectively were the same at $1.3 million each. It is important to note that even though SG&A expenses in 2006 increased, revenue and gross margins have increased significantly more during this same period. This is consistent with management's strategy of growing top line revenue while minimizing SG&A expense increases.

Net income in 2006 was $1.6 million (earnings per share of $0.05), an improvement over the loss of $0.4 million (loss per share of $0.01) in 2005. Net income for the fourth quarter of 2006 was $0.3 million (earnings per share of $0.01), compared to net income of $0.2 million (earnings per share of $0.00) in the fourth quarter of 2005.

Earnings before Interest, Taxes, Depreciation, Amortization and Stock-based compensation (EBITDA*) for 2006 was $3.3 million compared to $1.0 million in 2005, an improvement of $2.3 million. EBITDA* for the fourth quarter of 2006 was $0.9 million compared to $0.5 million in the fourth quarter of 2005, an improvement of $0.4 million. -- www.cnxmarketlink.com