SOURCE: Joystar, Inc.

October 05, 2005 08:30 ET

Joystar CEO Updates Shareholders

ALISO VIEJO, CA -- (MARKET WIRE) -- October 5, 2005 -- Joystar, Inc. (OTC BB: JYSR), one of the nation's largest and fastest growing travel agency networks, issued today an update from Chairman and CEO William Alverson.

To Our Shareholders:

Joystar is the right company in the right industry at the right time. The first six months of 2005 have been distinguished by both rapid expansion of our travel agency network and dramatic growth in sales. It is with great pride and optimism that I report the highpoints of the year thus far and the strategy I believe will drive shareholder value well into the future.

According to a report issued by Credit Suisse/ First Boston in January 2005, 20,000 professional travel agents are operating from virtual offices, and analysts predict that number will grow to close to 50,000 agents by 2010. I believe the opportunity for growth in virtual sales is exponentially higher. I believe the number of agents working from home in 2010 is going to be closer to 250,000 and Joystar is on the cusp of an explosive industry growth trend. We are building the infrastructure today to benefit from the re-tooling of tomorrow's global, virtual travel industry.

As thousands of professional travel retailers -- in their efforts to expand upon their businesses, while controlling costs -- continue to migrate from bricks & mortar locations to online operations, Joystar continues to gain momentum. As our bookings and commission levels with our preferred suppliers increase, we continue to distance ourselves from the competition. We're giving back travel agents their dignity. We're making the travel industry a better place to work.

In August of 2004, we introduced our hosting program, Agent Advantage Pro, to the travel industry with a goal to have 500 professional agents by the end of the second quarter of this year. As of June 2005, our network had surpassed 2,000 agents -- far exceeding our initial expectations. Since then, we continue to capture market share away from our competitors in this rapidly emerging market with the addition of approximately 200 new members each month.

This comprehensive initiative was just the beginning of our planned expansion. Our ongoing objective is to capitalize on the broad acceptance of the Company's value proposition to travel agents. We have customized and implemented programs for high achievers as well as developed an enterprise solution for home-based or "micro" host agencies. In just one year, we have built Joystar into a well-known brand and established an active and diversified base of selling agents who have begun to evangelize our services. Our goal is to have a virtual sales force 8,000 - 10,000 strong by the end of 2006.

For the quarter ended June 30, gross travel sales increased 255% to $1,367,477 compared to $535,788 for the previous quarter. Additionally, Joystar received new travel bookings totaling over $4.3 million during the same period. Exceptionally strong bookings growth has continued through the summer -- a historically slow period for the travel industry.

On July 19, we closed a $1.6 million equity financing placed with institutional and accredited investors bringing the total amount raised to over $4 million. The most recent financing substantially eliminated Joystar's debt and provided capital to purchase and expand the Miami Cruise Center. The integration of the Miami Cruise Center into our operations has enhanced our financial performance and has the potential to provide increased revenue opportunities and better margin revenue in the near future. The ramp-up of our cruise call center and group cruise division in the fourth quarter will be a key driver to our profitability.

The success of agent recruitment initiatives can be seen in the dramatic strength in our bookings which we believe will reach $100 million run rate by the end of the first quarter in 2006. I am also targeting breakeven by the end of the first quarter of 2006.

I attribute our dramatic growth to several important factors including the acquisition and expansion of the Miami Cruise Center, enhanced preferred supplier commissions, and organic growth in professional agent memberships. The Miami Cruise Center has generated $30 million in sales over the past five years and has preferred supplier relationships with Carnival, Celebrity, Holland America and several other leading cruise lines in the industry. This acquisition has had immediate impact on our commission levels and increased our competitive edge as a host agency.

In our never-ending quest to be the host agency of choice to the travel industry, we are developing an enhanced version of our private label websites. This will further empower our network of travel retailers to compete effectively against the online travel giants. At the same time we are nearing completion of My Joystar, our next-generation "Agents Only" extranet to support our agents.

It's no secret that I believe we are very favorably positioned to capture further market share in the host agency model. The industry-wide excitement of this emerging model can be likened to a "Gold Rush." The gold? Tens of thousands of professional travel agents that represent billions of dollars in travel sales annually. Qualified people who offer real value to travel consumers is what Joystar is centered on. They need a great company to take care of them. That company is your company. That company is Joystar.

As always, thank you for your continued support.

Very truly yours,

William Alverson
Chairman and CEO
Joystar, Inc.
About Joystar, Inc.

Joystar is one of the nation's largest and fastest growing travel agency networks. The Company specializes in selling comprehensive travel products including cruises, vacation packages and group travel through its national sales force of over 2,500 professional agents. Joystar's comprehensive business combines innovative technology, marketing opportunities and expert support services to the Company's independent and home-based travel agents. With Joystar, professional travel agents can concentrate on promoting travel and creating customer loyalty without the administrative and financial burden of owning/operating a traditional storefront travel agency.

Safe Harbor Act

"Forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 may be included in this news release. These statements relate to future events or our future financial performance. These statements are only predictions and may differ materially from actual future events or results. Joystar, Inc. disclaims any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments or otherwise. Please refer to the documents filed by Joystar, Inc. with the Securities and Exchange Commission, which identify important risk factors that could cause actual results to differ from those contained in forward-looking statements, including, but not limited to risks associated with our ability to (i) increase revenues, (ii) obtain profitability, and (iii) obtain additional financing, changes in general economic and business conditions (including in the online business and financial information industry), actions of our competitors, the extent to which we are able to develop new services and markets for our services, risks in connection with acquisitions, the time and expense involved in such development activities, the level of demand and market acceptance of our services and changes in our business strategies.

Additionally, forward-looking statements concerning the performance of the travel and leisure industry are based on current market conditions and risks, which may change as the result of certain regulatory, political or economic events, a shift in consumer travel preferences, as well as those risks and uncertainties described in the Company's filings with the Securities and Exchange Commission, which could cause actual events or results to differ materially from the events described in the forward-looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements.

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