BOSTON, Nov. 16, 2006 (PRIMEZONE) -- Technest Holdings, Inc. (OTCBB:TCNH), a defense and homeland security company, issued operating results for the fiscal 2007 first quarter ended September 30, 2006.
The Company posted revenue of $20.0 million during the quarter ended September 30, 2006, an increase from $19.0 million during the quarter ended September 30, 2005. Gross profit for the fiscal 2007 first quarter increased 10% to $3.8 million, or 19% of revenues from $3.4 million, or 18% of revenue during the first quarter of 2005. Technest expects gross profit to improve as the Company expands its revenues from commercial products. During the period, the Company reported an operating loss of $0.4 million in the first quarter compared with $0.1 million during prior quarter in 2005. The net loss attributable to common shareholders was $1.9 million, or $0.12 per basic and diluted share for the quarter ended September 30, 2006 compared to net income of $24.2 million, or $1.70 per basic share. The net loss for the quarter ended September 30th ,2006 included $2.5 million of non cash charges including $1.4 million for non cash interest. The net income during the 2005 period was completely attributable to derivative net income of $25.0 million.
Total revenue under the United States Army Night Vision and Electronic Sensors Directorate (NVESD) contract during the period ended September 30, 2006 increased to $17.4 million from $16.3 million during the quarter ended September 30, 2005. During the quarter, Technest through its subsidiary, E-OIR Technologies, Inc., provided labor, materials and engineering support services for several projects under the NVESD Omnibus contract. Additionally, the Company received funding to conduct further research and provide support towards the development of new advanced electronic signal components. During the quarter, Technest initiated the fifth option year for the Omnibus contract.
"We are pleased with our top line financial results for the quarter," said Dr. Joseph P. Mackin, President and Chief Executive Officer of Technest Holdings. "For fiscal 2007, our goal is to increase traction in servicing the United States Department of Defense, developing new and improved remote sensors and security tools. By further developing our Smart Optical Sensor technology we will be able to more effectively address the need for affordable, accurate video surveillance to meet increased demand due to the increased exposure in geopolitical risks."
Dr. Mackin concluded, "Moving forward, we plan to apply our existing technologies to new applications that address the surveillance needs of local law enforcement and other federal agencies. These new applications will diversify our offerings and improve gross margins."
For additional information the Company's Current Report on Form-10Q 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