SOURCE: Sitestar Corporation

April 03, 2007 09:17 ET

Sitestar Reports Fiscal 2006 Results

Record Earnings Achieved as Company Expands Customer Base, Reduces Debt & Maximizes Operations

LYNCHBURG, VA -- (MARKET WIRE) -- April 3, 2007 -- Sitestar Corporation (OTCBB: SYTE), a provider of Internet access and value-added online and computer services, announced today that it achieved a tenth straight quarter of profitability and posted record earnings for the year ended December 31, 2006 including increases in revenue, EBITDA (earnings before interest, taxes, depreciation and amortization) and net income of more than 50 percent. The Company also significantly reduced debt by trimming notes payable by over 37 percent. In addition, Sitestar maximized operational efficiencies by negotiating more favorable contracts with telecommunication vendors, optimizing network capacity and implementing internal best-practices. Financial highlights for the year include:

--  Total Revenue was $5,597,330, an increase of $1,917,348 or 52.1
    percent from $3,679,982 for the same period in 2005.
    
--  EBITDA was $2,243,921, an increase of $824,604 or 58.1 percent from
    $1,419,317 for the same period in 2005.
    
--  Net Income was $992,385, an increase of $352,271 or 55 percent from
    $640,114 for the same period in 2005.
    
--  Total notes payable, including notes payable to shareholders was
    $1,211,034, a decrease of $716,401 or 37.2 percent from $1,927,435 for the
    same period in 2005.
    
--  End of year income per share was $0.01.
    
In fiscal year 2006, Sitestar acquired the Internet service customers from NetRover, Inc., Prolynx, Inc. and First USA, Inc., yielding approximately $1,477,000 in additional net revenues. Additionally, the Company continued its strategy to foster sustainable growth and increase shareholder value by developing its mergers and acquisitions pipeline, intensifying investor relations to improve market awareness for Sitestar, exploring methods to raise capital for larger acquisitions and evaluating new and emerging technologies for inclusion within the Sitestar portfolio of services.

"2006 was an excellent year for Sitestar during which we delivered upon our stated objectives of growing our customer base and revenues, being fiscally responsible and maximizing shareholder value," said Frank R. Erhartic, Jr., CEO for Sitestar. "We achieved a 56.2 percent increase in Internet sales, our core growth area. We also completed important acquisitions that will generate strong revenue over the next several years. Plus we continued to pay down and, in a number of cases, retire debt which not only improves our balance sheet but affords us the financial flexibility to consummate future acquisitions."

"Finally, we entered 2007 with positive momentum and a foundation for significant growth," added Mr. Erhartic. "The investor community is taking notice of Sitestar and our acquisition opportunity pipeline is strong. We are optimistic about Sitestar's growth potential and believe that both investors and the share price will respond commensurately."

Sitestar has scheduled an online shareholder chat discussion for Wednesday, April 25, 2007 at 4:30pm Eastern Daylight Time to review its end of year results. Investors interested in participating are encouraged to register on the Sitestar corporate web site (http://www.sitestar.com). Once registered, participants may suggest topics for discussion. On the day of the event, registered parties will receive an email with instructions on how to join the online discussion.

Safe Harbor for Forward Looking Statements

This press release contains forward-looking statements that are based on management's expectations, estimates, projections and assumptions. The Company assumes no obligation except as required by law to update the forward-looking statements contained in this press release as a result of new information or future events or developments. These forward-looking statements generally can be identified by words such as "believes," "expects," "projects," "anticipates," "foresees," "forecasts," "estimates," "should" or other words or phrases of similar import. Forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. These statements are not guarantees of future performance and involve certain risks and uncertainties, which are difficult to predict. Therefore, actual future results and trends may differ materially from what is forecast in forward-looking statements due to a variety of factors, including and without limitation, as found in the Company's reports filed with the Securities and Exchange Commission.

About Sitestar

Sitestar (www.sitestar.com) is an Internet and computer solutions provider that offers narrowband and broadband Internet access services, Web hosting and design, and other value-added services including web acceleration, spam and virus filtering as well as spyware protection. Headquartered in Lynchburg, Virginia, Sitestar maintains multiple sites of operation and provides services to customers throughout the U.S. and Canada, with concentrations in customers in the Mid-Atlantic and Rocky Mountain regions in the U.S. and in Ontario, Canada. With a focus on competitive pricing, reliability, service and speed, Sitestar delivers customer value.

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