IBIN IBSG International Inc (CE)

IBSG International, Inc., (the �Company�), (OTC BB: IBIN) announced today its financial results for the first quarter ended March 31, 2007. In the first quarter of 2007, recognized revenues were slightly above $3.0 million compared to $1.7 million in the same period prior year. The Company had deferred revenues for the three months ended March 31, 2007 of $2.97 million. Gross profit for the quarter ended March 31, 2007 rose more than 80% to $2.9 million compared to $1.6 million in the previous year. Reduction in current receivables inclusive of cash collections before new receivables for the quarter reduced by Income from Operations in first quarter 2007 was just over $1.8 million compared to $780,000 in first quarter 2006. Net Income reported for the three months ending March 31, 2007 was $1.1 million, or $0.15 per fully diluted share, compared to a net income in first quarter 2006 of $217,000, or $0.03 per fully diluted share. Operating expenses rose to $1.1 million for the first quarter of 2007 from $851,000 for the same period in 2006. The primary reason for the increase was professional expenses of $94,500. Another reason for the increase was due to an accrual allowance for bad debt of $176,000. Management has determined that an allowance should be set aside due to the growth of its private clients compared to government clients. This allowance is not for any specific customer just an allowance established for the change in its customer base. Other expenses rose to $772,000 million in the first quarter 2007 from $563,000 in the first quarter of 2006. The increase in other expenses for 2007 was the accrual of taxes of $804,753 compared to an accrual of $12,188 in 2006. Dr. Michael Rivers, CEO of IBSGI, said, �The first quarter 2007 builds on the successes IBSGI and its subsidiaries had in 2006. The majority of our continued growth is driven by existing business both domestically and internationally. This is a continuing example of how our business model continues to exponentially grow once a project is in place. Our collections increased but again, so did the revenue for new business which has an overall effect of increasing in revenues from the previous quarter rather than decrease them. Our projections for 2007 are primarily based on existing projects not new contracts. However, business opportunities for new projects in different nations as well as states in the US continue to come to us. He also said, �Since the end of the quarter, IBSGI was selected as The Bowser Report's �Stock of the Month� for its April 2007 stock report newsletter, an honor of which we are quite proud. R. Max Bowser has been in the business of analyzing stocks for 30 years, and his newsletter uses fundamental analysis to select and recommend stocks to its subscriber base. Recognition from third-parties like Mr. Bowser is very gratifying, and it is a tribute to the hard work our staff and our subsidiaries put in each and every day.� Management of IBSG International will host a conference call at 2 p.m. EDT tomorrow to discuss the company�s financial results and achievements. Those who wish to participate in the conference call may telephone 888-335-6674, from the U.S. or, 973-935-2100 for international callers, PIN # 8795135 approximately 15 minutes before the call. A digital replay will be available by telephone for two weeks and may be accessed by dialing 877-519-4471 from the U.S. or, 973-341-3080 for international callers, and entering PIN # 8795135. About IBSG International, Inc. IBSG International, Inc. is a holding company for four technology and software subsidiaries: Intelligent Business Systems Group, Inc. (IBSG), a provider of turnkey digital service center software; Secure Blue, Inc., a Sarbanes-Oxley and security software solution provider; Intelligent Business Systems Development (IBSD), a software development, maintenance and data storage company; and A-Division IT, a consultant company focused on development of IT projects for multinational corporations. IBS Group offers enterprise solutions designed to enhance the operating efficiency and create revenue for State Small Business Development Centers, business associations (e.g., business associations) and Fortune 1000 corporations by licensing its unique turnkey digital service center software, which provides a broad range of digital budgetary, administrative and commercial services (B2B, e-commerce, government to business and enterprise business services) on a single platform known as the BizWorld Pro�. Secure Blue, Inc. provides a robust economical Sarbanes-Oxley (SOX) compliance and security software suite, Secure Blue SOX Pro. It is targeted at small- and mid-cap public companies as well as private companies requiring SOX compliance to enable them to continue working with public companies. As software providers, system integrators and Application Service Providers, IBS Group, Inc. and Secure Blue, Inc. generate revenue from license sales, system modifications, systems support and a percentage of monthly customer fees. The typical IBS Group/Secure Blue license agreement has a five-year term which is updated on an annual basis. IBS Development, Inc. will provide ongoing support of International�s other subsidiaries, IBS Group and Secure Blue. The company provides development, system support and secure data storage, and will maintain offices in the US and India, where its current offshore development and support team is located. A-Division IT establishes IT projects for various countries around the world and for multinational corporations around the world. A-Division has already introduced and continues to provide demonstrations of the system on a national scale. For multinational corporations, the projects are recognized off-set program qualified and provide a required contractual obligation of these corporations. A-Division IT through its associations is an offset provider to BAE Systems and maintains relationships with various other multinational corporations. A-Division maintains offices in the United Kingdom. Safe Harbor Forward-Looking Statements Except for historical information contained herein, the statements in this release are forward-looking statements that are made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. The above information does not guarantee any successful closing of new business. No assurances can be given that any projections related to gross revenues or profit margins will be realized. Forward-looking statements involve known and unknown risks and uncertainties that may cause the companies� actual results in future periods to differ materially from forecasted results. Such risks and uncertainties include, but are not limited to, market conditions, competitive factors, the ability to successfully complete additional financings and other risks. IBSG INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Balance Sheet (Unaudited) � ASSETS � CURRENT ASSETS March 31, 2007 Cash $ 705,881� Accounts receivable, net 17,908,762� Prepaid expenses � 418,165� � Total Current Assets � 19,032,808� � FURNITURE, FIXTURES AND SOFTWARE, NET � 983,016� � OTHER ASSETS � Account receivable - long term 1,736,433� Deposits and other assets 200,273� Deferred consulting services 3,243,371� Goodwill � 38,000� Total Other Assets � 5,218,077� � TOTAL ASSETS $ 25,233,901� � LIABILITIES AND STOCKHOLDERS� EQUITY � CURRENT LIABILITIES March 31, 2007 � Accounts payable and accrued expenses $ 789,669� Accrued tax provision 2,950,402� Deferred revenue 2,966,740� Capital leases payable � 2,687� � Total Current Liabilities � 6,709,498� � COMMITMENTS AND CONTINGENCIES � STOCKHOLDERS� EQUITY � Common stock authorized 100,000,000 shares at $0.001 par value; 7,052,181 shares issued and outstanding 7,052� Additional paid-in capital 16,230,838� Retained Earnings � � 2,286,513� � Total Stockholders� Equity � � 18,524,403� � TOTAL LIABILITIES AND STOCKHOLDERS� EQUITY � $ 25,233,901� IBSG INTERNATIONAL, INC. AND SUBSIDIARIES Consolidated Statements of Operations (Unaudited) � Three months ended March 31, � 2007� � 2006� � Sales $ 3,030,716� $ 1,698,811� � Cost of Sales � � 89,093� � 68,043� � Gross Profit 2,941,623� 1,630,768� � Operating Expenses Amortization and depreciation 7,904� 10,394� Stock based compensation 297,665� 346,589� Salary 240,167� 213,955� General and administrative 383,814� 254,704� Bad debt expense 176,000� Total Operating Expenses � � 1,105,550� � � 850,642� � Income from Operations � � 1,836,073� � 780,126� � Other Income (Expense) Interest income 32,946� -� Loss on debt settlement and warrants -� (470,897) Change in fair value of embedded options -� (18,683) Change in fair value of warrants -� (61,181) Tax provision � � (804,753) � (12,188) Total Other Income (Expense), net � � (771,807) � (562,849) � Net Income � $ 1,064,266� $ 217,177� � Net Income Per Share - Basic And Fully Diluted � $ 0.15� $ 0.03� � Weighted average number of shares outstanding during the period - Basic And Fully Diluted � � 7,072,895� � 6,225,577�