SOURCE: Technest Holdings, Inc.

May 14, 2007 08:30 ET

Technest Holdings Response to Heavy Trading Volume

BETHESDA, MD -- (MARKET WIRE) -- May 14, 2007 -- Technest Holdings, Inc. (OTCBB: TCNH) a defense and homeland security company, issues the following announcement after extraordinary trading volume on Friday, May 11, 2007.

On Friday, May 11, 2007 at approximately 3:30 pm, an extraordinarily high volume of shares of Technest common stock were sold on the OTCBB. The volume during the last 30 minutes of trading was approximately 900,000 shares in contrast to a daily volume of less than 50,000 shares a day since the dividend payment of Technest shares to Markland Technologies shareholders on May 4, 2007. As a result, shares of Technest closed at $0.31 at the end of the day, a decline of over 66% on the previous days close. The management of Technest believes that the value of Technest is not reflected in Friday's closing price and would refer investors to our 10QSB which was filed with the SEC at 4:34 pm on Friday, May 11, 2007. For the third quarter ending March 31, revenues were $17.95 million in 2007 compared to $17.86 million in the same period in 2006. Gross profit for the third quarter was $3.93 million vs. $3.24 million in the third quarter of 2006. The operating loss for the quarter narrowed to $268,926 compared with $795,772 for the same quarter a year ago. The net loss attributable to common shareholders was $0.92 million or $0.05 per share in the quarter ended March 31, 2007 compared to a net loss of $1.52 million or $0.10 per share in the comparative quarter in 2006.

On March 29th, 2007 the Company also announced that its wholly owned subsidiary, EOIR Technologies, received delivery orders totaling approximately $58 million to fund two new projects. The first is for a Near Term IED Detection System and the second is for a Wide Area Surveillance and Improvised Explosive Device Detection System. Both were awarded on behalf of the U.S. Army's Night Vision and Electronic Sensors Directorate ("NVESD").

Technest also continues to evaluate strategic alternatives for the Company and/or its subsidiaries.

About Technest Holdings, Inc.

Technest Holdings, Inc. is a provider of: advanced remote sensor systems, chemical detectors, intelligent surveillance and advanced 3D imaging technology solutions to the defense and homeland security marketplaces. Technest is committed to setting next-generation standards in defense and security through the provision of innovative emerging technologies and expert services. Technest's solutions support military, law enforcement and homeland security personnel. Through strategic development, Technest focuses on the creation of dual-use technology and products with applications in both the defense market and civilian homeland security and law enforcement fields. For more information, please visit the company's website at http://www.technestholdings.com.

Investors are cautioned that certain statements contained in this press release are "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995 (the "Act"). Forward-looking statements include statements which are predictive in nature, which depend upon or refer to future events or conditions, which include words such as "expects," "anticipates," "intends," "plans," "believes," "estimates," or similar expressions. In addition, any statements concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, applicability, benefit and use of our product and possible future actions, which may be provided by management, are also forward-looking statements as defined by the Act. Some of the factors that could significantly impact the forward-looking statements in this press release include, but are not limited to: the functionality of our product; a rejection of the Company's products and technologies by the marketplace; and disputes as to the Company's intellectual property rights. Forward-looking statements are based upon current expectations and projections about future events and are subject to risks, uncertainties, and assumptions about Technest Holdings, its products, economic and market factors and the industries in which Technest Holdings does business, among other things. These statements are not guarantees of future performance and Technest Holdings has no specific intention to update these statements. More detailed information about those factors is contained in Technest Holdings' filings with the Securities and Exchange Commission. http://www.sec.gov

Contact Information

  • Contact:
    Stanley Wunderlich
    Consulting for Strategic Growth 1
    (800) 625-2236
    (516) 729-3714
    swunderlich@cfsg1.com