SOURCE: IDI Global, Inc.

May 16, 2005 16:09 ET

IDI Global Reports Results for First Quarter 2005

Company Posts Earnings of $305,000; Well on Track to Reach 2005 Earnings Projections of $700K to $1M

OREM, UT -- (MARKET WIRE) -- May 16, 2005 -- IDI Global, Inc. (OTC BB: IDIB) ("IDI") released financial results for the quarter ended March 31, 2005.

Highlights of the first quarter 2005 include:

--  Posted revenues of $6.9 million, a significant increase over revenues
    from the fourth quarter of 2004.
--  Reported earnings of $305,000 putting the Company well in position to
    achieve 2005 projections of $700,000 to $1M.
--  Realized year-over-year increase in operating margin from 5.8 percent
    to 6.2 percent, primarily as a result of an acquisition strategy that
    lowers the cost of sales by bringing lead-generation capabilities in-house.
    The Company anticipates that this strategy will continue to translate to
    improved revenues, earnings and margins in coming quarters.
--  Reached an Asset Purchase and Stock Purchase Agreement with Mentoring
    of America and HG Marketing, growing the Company's sales and marketing
    assets and creating an ongoing source of Small Office/Home Office (SOHO)
    business owner leads for this channel, which will contribute operating
    profits of at least $150,000 per month.
--  In conjunction with the Company's acquisition of sales and marketing
    organizations, the Company incorporated IDI Small Business (IDISB) as IDI
    Global's wholly owned subsidiary, which will ultimately house IDI's sales
    and marketing operations to better manage and report on their activities.
--  Signed an agreement to supply ARRAY technology to a multi-billion
    dollar direct sales company.
--  Continued to see customer interest in ARRAY Express model, a version
    of the corporate Web site solution with lower upfront costs and a shorter
    implementation time designed to broaden the product's appeal to mid-sized
    businesses. As a result of this product launch in 2004, IDI has succeeded
    in shortening the average ARRAY sales cycle and increasing recurring
    revenues from the product.
    
Revenues for the quarter ended March 31, 2005, were $6,956,283, compared to $3,721,061 for the quarter ended December 31, 2004, and $8,121,473 for the comparable period in 2004. The decrease in year over year revenues is attributed to the company's discontinuance of certain outsourced sales and marketing relationships, which generated revenues with very low margins. In an effort to increase margins and overall earnings, IDI made the decision to create internal sales and marketing capabilities that have directly increased profits and improved customer satisfaction. Reduced revenues also reflect a slight decline in the ARRAY sales channel as the Company launched the ARRAY Express solution with a new pricing model.

Net income for the quarter ended March 31, 2005, was $305,424, or $0.01 per share, compared to a net loss of $1,334,000, or negative $0.08 per share in the quarter ended December 31, 2004 and a net income of $442,297, or $0.03 per share for the comparable period in 2004.

"In 2004, we launched several initiatives to drive sales of both our ARRAY and SOHO products as well as to improve operating margins," stated Kevin Griffith, CEO of IDI Global. "This quarter, we see the early indications that these measures are making our business more profitable. Our acquisitions and asset purchases of sales and marketing businesses have lowered our cost of sourcing customers in the Small Office/Home office market, resulting directly in higher margins and projected earnings. The ARRAY Express product has allowed us to introduce our product to mid-size corporations that typically have a shorter sales cycle. Our recent contract with a major, well known direct sales company for our ARRAY product demonstrates its continued dominance in that market. Finally, we are continuing to look for opportunities to strengthen our sales and marketing capabilities through acquisition, driving growth at both the top and the bottom line and creating shareholder value."

Conference Call

IDIB will host a conference call today at 4:15 PM EDT to discuss the Company's financial and operating performance for its first quarter 2005 and to respond to investor questions. All those interested in hearing management's discussion are invited to join the call by dialing (877) 407-8035. International participants may access the call by dialing (201) 689-8035. A replay will be available for one week following the call by dialing (877) 660-6853 for domestic participants and (201) 612-7415 for international participants and entering account number 286 and conference ID number 151380 when prompted.

About IDI Global, Inc.

IDI Global, Inc. is an application service provider of infrastructure technologies and services that implements comprehensive Internet-based business solutions. IDI's primary market is the small-business owner, the home-office industry, and larger companies within vertical markets that have large affiliate networks. The technology engine that powers these programs allows both large complex organizations and small stand-alone businesses to exploit the full capabilities of the Internet.

Forward-Looking Statements

This press release contains certain forward-looking statements. Investors are cautioned that certain statements in this release are "forward-looking statements" and involve both known and unknown risks, uncertainties and other factors. Such uncertainties include, among others, certain risks associated with the operation of the company described above. The Company's actual results could differ materially from expected results.

Contact Information

  • Mark Hildebrandt
    Vice President
    (801) 224-4444

    The Investor Relations Group
    Investors: Andrea Faville/Ross D'Eredita
    Phone: (212) 825-3210