IBSS Integrated Business Systems and Services Inc (CE)

Integrated Business Systems and Services, Inc. (IBSS) (OTCBB:IBSS) today announced its first quarter financial results for the three-month period ended March 31, 2005. For the three months ended March 31, 2005, IBSS reported a 29% decline in revenues to $543,280 from $765,680 for the comparable three-month period in the prior year. Net loss for the first quarter decreased to $319,296, or $.01 basic and diluted loss per share, compared to a net loss of $322,201, or $.01 basic and diluted net income share, reported for the three months ended March 31, 2004. "While there was a marked decline in revenues relative to the first quarter of last year, our net loss showed a slight recovery indicating that the Company is making progress in its cost containment efforts," said Michael Bernard, Chief Financial Officer of the Company. "IBSS continues to be challenged by the sales cycle necessary to develop new customer relationships that are capable of producing significant revenue generating opportunities for IBSS. Though we are pleased to show some bottom line improvement, we recognize that the Company requires a significant increase in revenues and additional capital investments, without which we will not be able to continue to implement our business plan." George Mendenhall, CEO of IBSS, added, "Though we are challenged financially, we remain riveted to our focused growth strategy to capture a meaningful share of the explosive RFID and wireless solutions market. In this regard, we are continuing to make progress in establishing the value of Synapse(TM) in RFID and Mobile computing applications. Synapse(TM), our proprietary application development and implementation environment, is ideally constructed to fully exploit the Linux operating system in delivering real-time applications. The compact and efficient size of the complete Synapse(TM) software environment allows it and Linux to fit onto devices with very small memory resources. And despite its small size, we believe Synapse(TM)is unparalleled in its power for enterprise scalability and transaction handling." Concluding, Mendenhall noted, "As the value of IBSS' RFID and mobile solutions continue to win momentum and support among our customers and strategic partners, some of which include: Prospect Airport Services, Arthur Blank & Co., Ekahau, Inc. and USM Systems, Ltd. We look forward to making notable progress in our effort to build enduring and enhanced value for each of our shareholders." About IBSS IBSS is the creator of Synapse(TM), a groundbreaking software technology. Synapse(TM) is a complete framework and methodology used to create, implement and manage a wide variety of dynamic, distributed, networked, and real-time enterprise applications including RFID, quickly and efficiently. Global enterprises utilizing Synapse(TM) leverage the power of its single, flexible framework to enjoy tremendous time and cost advantages, in the development, deployment and on-going management of customized applications. Enabled by Synapse(TM) to take competitive advantage of cutting-edge technologies such as wireless networking, mobile computing and RFID, IBSS and its strategic partners bring solutions to customers for mission-critical applications in manufacturing, distribution, healthcare, finance, insurance, retail, education, and government. IBSS is headquartered in Columbia, South Carolina. For more information about IBSS and its Synapse(TM) technologies and services, call 803-736-5595 or 800-553-1038, or visit www.ibss.net. FINANCIAL CHARTS TO FOLLOW -0- *T INTEGRATED BUSINESS SYSTEMS AND SERVICES, INC. CONSOLIDATED BALANCE SHEET (Unaudited) (Audited) March 31, 2005 December 31, 2004 -------------------------------- Assets Current assets: Cash and cash equivalents $ 114,730 $ 105,084 Accounts receivable, trade 333,926 66,637 Interest receivable -- 3,065 Notes receivable -- 75,000 Other prepaid expenses 78,448 19,646 ------------ ------------ Total current assets 527,104 269,432 Capitalized software costs, net 8,211 10,948 Property and equipment, net 231,690 256,911 Interest receivable, non current 39,039 37,331 Other assets 50,000 50,000 ------------ ------------ Total assets $ 856,044 $ 624,622 ============ ============ Liabilities and Shareholders' Deficiency Current liabilities: Convertible notes payable, net of discount $ 613,900 $ 558,439 Shareholder advances 826,000 601,000 Current portion of long-term debt 309,372 309,131 Accounts payable 92,315 52,510 Accrued liabilities: Accrued compensation and benefits 225,487 160,166 Accrued payroll taxes 19,545 29,649 Accrued professional fees 372,010 326,241 Accrued interest 61,008 55,857 Accrued rent 15,000 15,000 Other 2,390 7,090 Deferred revenue 255,483 134,873 ------------ ------------ Total current liabilities 2,792,510 2,249,956 Long-term debt, net of discount 2,869,705 2,872,251 ------------ ------------ Total liabilities 5,662,215 5,122,207 ------------ ------------ Commitments and contingencies Shareholders' deficiency: Preferred stock, undesignated par value, 10,000,000 shares none authorized or issued -- -- Common shares, voting, no par value, 200,000,000 shares authorized, 32,510,400 and 32,506,144 shares outstanding at March 31, 2005 and December 31, 2004, respectively 21,694,205 21,683,495 Notes receivable officers/directors (131,080) (131,080) Accumulated deficit (26,369,296) (26,050,000) ------------ ------------ Total shareholders' deficiency (4,806,171) (4,497,585) ------------ ------------ Total liabilities and shareholders' deficiency $ 856,044 $ 624,622 ============ ============ INTEGRATED BUSINESS SYSTEMS AND SERVICES, INC. CONDENSED STATEMENTS OF OPERATIONS (Unaudited) For the Three Months Ended March 31, ------------------------ 2005 2004 ------------ ----------- Revenues Services $461,063 $728,846 Licenses 24,228 -- Maintenance 45,907 28,428 Hardware sales 12,082 8,406 ------------ ----------- Total revenues 543,280 765,680 ------------ ----------- Cost of revenues 208,672 281,153 ------------ ----------- Gross margin 334,608 484,527 ------------ ----------- Operating expenses General and administrative 347,124 381,667 Sales and marketing 159,367 229,168 Product development costs 111,086 143,379 ------------ ----------- Total operating expenses 617,577 754,214 ------------ ----------- Loss from operations (282,969) (269,687) Other income (expenses): Other income (expenses) 2,160 (11,457) Interest expense (38,487) (41,057) ------------ ----------- Net loss $(319,296) $(322,201) ============ =========== Net loss per share: Basis and diluted $(0.01) $(0.01) ============ =========== Basic and diluted weight average shares outstanding 32,508,556 27,272,778 ============ =========== *T Except for historical information, the matters discussed in this news release include forward-looking statements that involve a number of risks and uncertainties. Actual results may vary significantly as a result of a number of factors, including, but not limited to, risks associated with the Company's ability to satisfy its obligations incurred in recent private placements of secured debt, risks in product and technology development and integration, market acceptance of new products and continuing product demand, the impact of competitive products and pricing, changing economic conditions, and other risk factors detailed in Exhibit 99.1 of our Annual Report on Form 10-KSB for the year ended December 31, 2004 and in other filings the Company makes with the Securities and Exchange Commission. Copies of these filings may be obtained from the Securities and Exchange Commission at its principal office in Washington, DC at prescribed rates by calling 1-800-SEC-0330. These filings are also available electronically through the Internet World Wide Web site maintained by the Securities and Exchange Commission at the Internet address: http://www.sec.gov.