BOSTON, Oct. 16, 2006 (PRIMEZONE) -- Technest Holdings, Inc. (OTCBB:TCNH), a defense and homeland security company, announced today its operating results for the fiscal year ended June 30, 2006.
The Company posted record revenue of $81.0 million for fiscal 2006. Gross profit for fiscal 2006 was $14.5 million, or 18% of revenues. Comparisons to the prior period are not applicable due to a change in fiscal year from December 31st to June 30th and the acquisition of Genex and EOIR, which were both treated as if they occurred as of February 2005. Technest expects gross profit to improve as the Company expands its revenues from commercial products. The net income attributable to common shareholders for fiscal 2006 was $20.2 million, or $1.25 per diluted share. This was due to non-cash derivative income in the amount of $25 million representing the change in fair value of certain warrants issued by Technest in February 2005. The prior period's financial results were also restated to reflect the change in fair value of these warrants during the six months ended June 30, 2005. This resulted in a non-cash charge of $30.2 million. Net cash provided by operating activities for the year ended June 30, 2006 was approximately $900,000.
"We are pleased with the results of our first complete fiscal reporting year since acquiring Genex Technologies and EOIR Technologies, our two wholly owned subsidiaries," said Dr. Joseph P. Mackin, President and Chief Executive Officer of Technest Holdings. "In fiscal 2006 we saw strong revenue through several military contracts, including $70.3 million from the fourth option year of our U.S. Army Night Vision and Electronic Sensors Directorate (NVESD) omnibus contract. Recently the U.S. Army awarded us an additional award year running through July 2007 as a result of our strong efforts and solid results helping develop the next line of advanced remote sensors for tomorrow's war fighter."
Dr. Mackin continued, "During the year we increased our presence and capabilities through a new on-site facility at the U.S. Naval Surface Warfare Center, Dahlgren Division (NSWCDD) and new location in Bethesda, Md. We believe our new engineering and product development capabilities will result in a greater number of contracts in the current fiscal year. Among our goals for this year is to continue to leverage our existing relationships within the government sector while developing a portfolio of products from our existing intellectual property."
For additional information the Company's Annual Report on Form-10KSB is available at www.sec.gov.
About Technest Holdings, Inc.
Technest Holdings, Inc., in combination with its operating subsidiaries EOIR Technologies and Genex Technologies, is a provider of: advanced remote sensor systems, chemical detectors, intelligent surveillance and advanced 3D imaging technology solutions to the defense and homeland security marketplaces. Technest is committed to setting next-generation standards in defense and security through the provision of innovative emerging technologies and expert services. Technest's solutions support military, law enforcement and homeland security personnel. Through strategic development, Technest focuses on the creation of dual-use technology and products with applications in both the defense market and civilian homeland security and law enforcement fields. For more information, please visit the company's website at http://www.technestholdings.com.
Technest Holdings, Inc. is a featured Company on http://www.HomelandDefenseStocks.com, a service for which Technest Holdings compensates the provider.
Investors are cautioned that certain statements contained in this press release are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). Forward-looking statements include statements which are predictive in nature, which depend upon or refer to future events or conditions, which include words such as "expects," "anticipates," "intends," "plans," "believes," "estimates," or similar expressions. In addition, any statements concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, our ability to obtain future contract, applicability, benefit and use of our product and possible future actions, which may be provided by management, are also forward-looking statements as defined by the Act. Some of the factors that could significantly impact the forward-looking statements in this press release include, but are not limited to: the functionality of our product; the Government's desire to continue to work with us; the competitiveness of our proposals; a rejection of the Company's products and technologies by the marketplace; and disputes as to the Company's intellectual property rights. Forward-looking statements are based upon current expectations and projections about future events and are subject to risks, uncertainties, and assumptions about Technest Holdings, its products, economic and market factors and the industries in which Technest Holdings does business, among other things. These statements are not guarantees of future performance and Technest Holdings has no specific intention to update these statements. More detailed information about those factors is contained in Technest Holdings' filings with the Securities and Exchange Commission. http://www.sec.gov