Q REPORT INSIDE !!OTTAWA, ONTARIO--(Marketwire - Jan. 31, 2008) - NUVO Network Management Inc., (TSX VENTURE:NVO), a leading managed services provider of solutions that MAXimize IT® availability and performance, today announced results from operations for its first quarter ended December 31, 2007. Highlights - Q1 - Revenue was $3.8 million, down from $4.2 million last year. - Earnings before interest, taxes, depreciation and amortization and foreign exchange (EBITDA) was $449,462 compared to $478,997 last year - Net income was $68,512 compared to $119,759 last year - Gross margin was 39%, compared to 41% last year - Signed $5 million of new contracts and renewals "We are pleased with the start of our fiscal 2008 year. In spite of a significantly lower US dollar, compared with Q1 a year ago, we recorded $449,462 in EBITDA and net income of $68,512" said Phil Weaver, Nuvo's President and CEO. "We continued to have strong bookings this quarter, with new orders and renewals totaling $5 million." Q1 Financial Results First quarter revenues were $3,833,521 compared with revenues of $4,153,841 in the same period a year ago. First quarter IT infrastructure management revenues were $3,309,007 compared to $3,603,659 in the same period a year ago. Maintenance, support and equipment revenues for the first quarter were $524,514 compared to $550,182 in the same period a year ago. Gross margins for the first quarter of fiscal 2008 were 39% compared with 41% in the same period a year ago. Earnings before interest, taxes, depreciation, and amortization and foreign exchange (EBITDA) for the first quarter of fiscal 2008 was $449,462 compared to $478,997 in the same period a year ago. Net income in the first quarter of fiscal 2008 was $68,512 compared to $119,759 in the same period a year ago. About NUVO NUVO provides remote management and protection of IT infrastructures for businesses worldwide to maximize the availability of their computing infrastructure. NUVO enables our customers to excel by delivering fully integrated, proactive management services and business data. This provides the critical information needed for effective analysis and decision-making to maximize performance and control costs. NUVO achieves this through certified experts, best-of-class technology, deep integration, highly automated processes, and best practices in a 24x7, resilient infrastructure. Forward Looking Statements Certain statements included in this press release are forward-looking and are subject to certain risks and uncertainties. The results or events predicted in these statements may differ materially from actual results or events. Factors that may cause results or events to differ from current expectations include, but are not limited to, those set out on NUVO's website at
https://www.nuvo.com CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT First Quarters Ended December 31, 2007 and 2006 (Unaudited) Three Months Ended December 31, December 31, 2007 2006 --------------------------------------------------------------------- --------------------------------------------------------------------- Revenues IT Infrastructure management $3,309,007 $3,603,659 Maintenance, support and equipment 524,514 550,182 --------------------------------------------------------------------- 3,833,521 4,153,841 --------------------------------------------------------------------- Costs of revenues IT Infrastructure management 2,031,761 2,096,278 Maintenance, support and equipment 319,009 346,347 --------------------------------------------------------------------- 2,350,770 2,442,625 --------------------------------------------------------------------- Gross margin 1,482,751 1,711,216 --------------------------------------------------------------------- Selling and marketing 493,434 584,315 General and administration 504,631 580,324 Research and development 309,392 278,630 Stock-based compensation expense 18,770 27,000 Amortization of purchased intangibles 85,128 106,317 --------------------------------------------------------------------- 1,411,355 1,576,586 --------------------------------------------------------------------- Operating income 71,396 134,630