Solium Capital Inc.
TSX VENTURE : SUM

Solium Capital Inc.

July 29, 2005 20:03 ET

Solium Capital Inc. Releases 2005 Second Quarter Results

CALGARY, ALBERTA--(CCNMatthews - July 29, 2005) - Solium Capital Inc. (TSX VENTURE:SUM) ("Solium" or the "Company") today announced its financial results for the quarter ended June 30, 2005.

The Company had earnings of $346,483 in the second quarter of 2005 compared to a net loss of $34,292 in the second quarter of 2004. Earnings for the six months ended June 30, 2005 were $696,611 compared to a net loss of $250,405 for the comparable period in 2004.



Highlights for the quarter ended June 30, 2005:

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Three Months Ended June 30
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2005 2004 % Change
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OPERATIONS
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E-SOAP participants 34,216 21,898 56
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Share Purchase participants 116,144 - N/A
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FINANCIAL
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Revenue $1,525,192 $803,902 90
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Expenses $1,178,709 $838,194 41
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EBITDA(1) $ 398,121 $ 40,899 873
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Net earnings (loss) $ 346,483 ($ 34,292) N/A
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Net earnings (loss) per share
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Basic $ 0.012 ($ 0.001) N/A
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Fully diluted(2) $ 0.012 N/A N/A
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Issued and outstanding
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Common shares 28,402,429 25,855,512 10
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Fully diluted 31,257,897 30,653,610 2
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Notes:

1. EBITDA is a non-GAAP financial measure which does not have any standardized meaning prescribed by GAAP (generally accepted accounting principles) and is therefore unlikely to be comparable to similar measures presented by other issuers. EBITDA provides useful information to users as it reflects the net earnings or loss prior to the effect of non-operating expenses such as interest, tax, depreciation and amortization. The Company currently does not have any income tax expense as a result of non-capital losses of approximately $7.2 million carried forward for tax purposes. The following is a reconciliation of EBITDA to net earnings (loss):



Three months ended June 30
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2005 2004
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EBITDA 398,121 40,899
Interest expense (10,068) (25,000)
Amortization expense (41,570) (50,191)
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Net earnings (loss) 346,483 (34,292)
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2. Fully diluted earnings per share is calculated using the treasury
stock method.


Financial results

- The positive net earnings in the second quarter of 2005 was the fourth consecutive quarter of positive earnings for the Company.

- Second quarter gross revenue in 2005 was $1,525,192, an increase of 90% over $803,902 in the second quarter of 2004. The overall increase was due mainly to increased access fee revenue from direct sales clients of $378,411, increased revenue from GRS Securities of $152,397, and increased transaction revenue of $153,632.

- Total expenses in the second quarter of 2005 of $1,178,709 increased by 41% over $838,194 in the second quarter of 2004. The overall increase was a reflection of the growth in the Company's business operations and was due to an increased employee base and increased general and administrative costs in Canada. In addition, expenses were incurred in the ongoing development of the U.S. operations.

Operations

- Two direct sales clients were implemented onto the E-SOAP application during the second quarter, adding approximately $100,000 in annualized access fee revenue.

- Two direct sales clients were implemented on the Share Purchase application during the second quarter, adding approximately $70,000 in annualized access fee revenue.

Other Corporate Matters

- As at June 30, 2005, the Company had in progress, twelve direct sales clients with approximately $375,000 in annualized access fee revenue being implemented onto E-SOAP and four direct sales clients with approximately $200,000 in annualized access fee revenue being implemented onto Share Purchase. Implementation of these clients is expected to be completed during the third and fourth quarters of 2005.

- The Company is continuing to develop its operations in the U.S. and has commenced direct sales activities

About Solium Capital Inc.

Solium Capital Inc. (TSX Venture: SUM) specializes in the administration and execution of equity-based incentive and savings plans and is setting the industry standard for service excellence, industry knowledge and innovative technical leadership. Solium aligns companies and people through employee equity services.

During 2004, Solium began to set the new standard for equity plan management by leading the convergence of employee equity incentives and savings into a single integrated platform. The Solium brand has traditionally included two distinct products, Solium E-SOAP and Solium Share Purchase. Solium has recently completed a re-branding process and has launched a new single product, Solium Shareworks™.

Certain information set forth in this document contains forward-looking statements. By its nature, forward-looking statements are subject to numerous risks and uncertainties which could cause actual results to differ materially from those anticipated by Solium and described in the forward-looking statements contained herein. The risks, uncertainties and other factors, both known and unknown, that could influence actual results may be substantial, which may include, among others, general business and economic conditions, the overall stock market performance, actions from competitors, the corporate governance environment and regulatory reporting requirements for Solium's clients, product capability and acceptance, the Company's ability to generate sufficient cash flow from operations to meet its current and future obligations, and the Company's ability to access external sources of financing if required. Accordingly, no assurances can be given that any of the events anticipated by these forward-looking statements will transpire or occur, or if any of them do so, what benefits the Company will derive therefrom. These forward-looking statements are made as of the date of this press release, and the Company assumes no obligation to update or revise them to reflect new events or circumstances.

The Management's Discussion and Analysis and the unaudited consolidated financial statements for the quarter ended June 30, 2005 referred to herein are available on SEDAR at www.sedar.com under Solium Capital Inc., or at www.solium.com.

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

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