Open EC Technologies, Inc.
OTC Bulletin Board : OCEIF
TSX : OCE

Open EC Technologies, Inc.

April 30, 2007 19:21 ET

Open EC Technologies, Inc. Reports Third Quarter, Fiscal 2007 Results and Business Activities Update

NORTH VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - April 30, 2007) - Open EC Technologies, Inc. (the "Company") (TSX VENTURE:OCE)(OTCBB:OCEIF) announces its financial results for the third quarter ended February 28, 2007 and provides an update on its operating activities. The Company has SEDAR filed its BC Form 51-901F third Quarter Report containing financial statements prepared by management without audit for the nine months ended February 28, 2007 (the "Quarterly Report"). Pursuant to the requirements of National Instrument 54-102, this news release provides a reasonable summary of the information contained in the Quarterly Report.

Financial Review

As at February 28, 2007 and 2006:

Total revenue for the quarter ended February 28, 2007 was $132,338 compared with $204,136 for the quarter ended February 28, 2006, a decrease of $70,798. Revenue for the nine months ended February 28, 2007 was $545,793 compared with $471,757 for the nine months ended February 28, 2006, an increase of $74,036.

Software sales decreased by $70,066 for the quarter ended February 28, 2007 compared to the quarter ended February 28, 2006. Training revenue also decreased by approximately $22,000; however, consulting fees increased by $19,764 in the quarter ending February 28, 2007 compared to the quarter ending February 28, 2006. Sales revenues remain below the required break-even revenue level and may well remain below this level for the foreseeable future.

The Company is projecting that as the shift to internet based business grows in North America in the strengthening economies, there should be a corresponding increase in IT spending. To increase sales, the Company has repackaged and positioned its products as high value, high performance solutions focused on providing a return on investment for its customers. Progress this year includes releasing new software packages, initiating a web marketing program to increase our customer base, and achieving higher levels of existing customer maintenance renewals and entering into new product partnerships. For the nine months ended February 28, 2007, sales increased approximately $74,000 compared to the nine months to February 28, 2006.

As of February 28, 2007, Open EC had $87,876 in cash and cash equivalents compared with $24,552 as of February 28, 2006. Working capital as at February 28, 2007 was ($202,642) compared with working capital of ($695,466) as at February 28, 2006. Capital assets, which represent net book value of computer and testing equipment, computer software, office equipment, and office furniture was $57,612 at February 28, 2007 compared with $60,790 as at February 28, 2006.

Salaries and wages for the quarter ended February 28, 2007 were $164,520 compared with $142,624 for the quarter ended February 28, 2006. The primary reason for this increase is the hiring of an additional technical person and increased wages for two staff members.

General and administrative expenses for the quarter ended February 28, 2007 were $82,438 compared with $84,737 for the quarter ended February 28, 2006. The decrease is primarily the result of decreased legal fees.

Amortization expense for the quarter ended February 28, 2007 was $3,087 compared with $4,382 for the quarter ended February 28, 2006.

The e-commerce landscape has been evolving over the last several years. While electronic data interface systems ("EDI") and associated e-business platforms were selling in the late 1990's and early 2000, the fall in tech market sentiment in the early 2000's impacted the Company's sales prospects. Customers were reluctant to adopt e-business solutions, and when they are adopting these solutions they were doing so at a slower pace than had been anticipated in the past. This resulted in weak markets for the Company and more competition in the Company's market space, creating downward pricing pressures on e-business products. The downward pricing pressure resulted in lower sales in the Company's market space in general and also resulted in a weakened industry. Larger information technology companies in adjacent segments seized on this opportunity to acquire some of the Company's competitors. It is conceivable that the acquisition of some competing companies in the Company's market space may precipitate further consolidating transactions. However, management is more encouraged by recent trends showing an improvement in e-commerce (internet based) use in the North American environment. Increasingly, large retail outlets such as Wal-Mart are requiring suppliers to adopt EDI and e-business platforms. As major retailers force primary suppliers to adopt EDI and e-business platforms, the Company anticipates improved markets for its products in coming years.

Markets for the Company's IT products continue to show signs of growing interest, including a new strategic relationship with Proginet (see the Company's news release dated Sept. 14, 2006), a developer of enterprise security software. The Company also continues to make progress with the Shenzhen Jinhuaye Software Ltd. ("Headware") proposed transaction, approved by the Company's Board of Directors, as announced October 18, 2006, which outlines the basic terms of a proposed agreement between the parties whereby the shareholders of Headware (the "Vendors") have granted Open EC the sole and exclusive right to purchase sixty percent (60%) of the issued and outstanding shares of Headware from the Vendors for the purchase price of $2,300,000 Cdn (the "Transaction"). In addition, the Vendors have granted Open EC an option to purchase the remaining forty percent (40%) of the issued and outstanding shares of Headware for cash consideration of $1,500,000 Cdn (the "Option"). The Option shall remain in effect for a period of one year from the date of closing of the Transaction. Upon closing of the Transaction, the Company shall own sixty percent (60%) of the issued and outstanding shares of Headware.

Operating Activities

The Company's revenue is derived from four areas: new software sales, consulting and training, software upgrades and maintenance fees on software previously sold. As new software sales occur, consulting and training revenue are realized. Following new software sales, the Company is able to charge subsequent annual maintenance fees each year to customers. Additionally, as the Company develops new and improved versions of its software, it is able to sell existing clients software upgrades.

Revenue is generated through two major channels: direct sales to customer and sales through partners. Partnership sales are expected to increase relative to direct sales. In fiscal 2006 and continuing into fiscal 2007, the Company focused on enhancing its core technology and value, along with positioning its products into new markets. The Company sells the OpenEC® products and solutions to the retail supply chain, healthcare industry, financial services companies and government agencies in North America. Product and software information is available on our website at www.softcare.com.

With its partner Mala Ventures Inc., a company controlled by the Company's President, the Company is carrying on its work developing a suite of products to be co-marketed by Proginet Corporation to their existing customer base. The delivery of these Company products and their commercial application is occurring at this time.

The relationship between Mala and the Company is governed by a Software Development and Marketing Agreement dated September 1, 2006 and amended March 1, 2006. Open EC continues to optimize business operations by reducing costs, resolving past liabilities and developing new revenue opportunities for its products.

About Open EC Technologies Inc.

Open EC is a TSX Venture Exchange listed company. Its subsidiary, SoftCare EC Solutions Inc., is an e-business software and solution provider. SoftCare's Open EC® e-business software includes solutions for Electronic Data Interchange (EDI), Business Process Management and Product Information Management (PIM). The Company sells the Open EC® products and solutions to the retail supply chain, healthcare, financial services and government agencies in North America. Additional product and solution information is available on the web at www.softcare.com and additional public company information is available on the web at www.openec.com. The Company's common shares trade on the TSX Venture Exchange under the symbol: OCE.

On Behalf of the Board of Directors

"Martyn A. Armstrong"

Martyn A. Armstrong
President & CEO

Further information about the Company can be found on SEDAR (www.sedar.com) or by contacting either, Mr. Martyn A. Armstrong, President & CEO of the Company or Mr. John A. Versfelt, CFO and a Director of the Company.

This news release may contain forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Forward-looking statements address future events and conditions and therefore, involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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