WebTech Wireless Inc.
TSX VENTURE : WEW

WebTech Wireless Inc.

December 14, 2006 16:09 ET

WebTech Wireless Reports 2007 First Quarter Results

BURNABY, BRITISH COLUMBIA--(CCNMatthews - Dec. 14, 2006) - WebTech Wireless Inc. (TSX VENTURE:WEW), a leading supplier of mobile telematics, today reported revenue of $3.9 million for the first quarter ended October 31, 2006, representing an increase of 53% over revenue for the prior comparable quarter of $2.6 million. Net income for the quarter was $34,000 ($nil per common share) compared with a loss of $331,000 ($0.01 per common share) for the prior comparable quarter. The Company reported a gross profit margin of 49%, consistent with the comparable quarter of 2006.

Historically, the Company's revenues are subject to seasonality. Revenues for the quarter represented a 22% decrease from revenues of the preceding quarter, which is consistent with the percentage decrease for revenues of the same quarter of the prior year. Despite the seasonality the Company reported profitability, where the first quarter historically has been a loss quarter.

Revenues grew in all geographic segments. Revenues to South America grew by 427% over the comparable quarter as the Company delivered 2,000 locators to its Brazil distributor for installation in Volkswagen passenger vehicles. To date the Company has delivered 16,400 locators of the 20,000 purchase order, which is scheduled for completion by December 31, 2006. The Company continues with its negotiations to provide locators for all Volkswagen passenger vehicles for manufacture and distribution in Brazil, estimated at greater than 400,000 vehicles per annum, and believes its prospects in this market are promising.

During the quarter the Company built its inventory levels, reporting an increase of 67% over inventory levels at the end of the preceding quarter. The Company is preparing for potential orders in North and South America. Expenses increased by 33% over the comparable quarter of the prior year, 46% due to increased research and development activities, 38% due to increase sales and marketing and 11% due to increased administration costs.

At October 31, 2006, the Company reported total assets of $22.5 million and working capital of $19.1 million, up from $22.3 million and $18.8 million respectively at the end of the most recently completed fiscal year.

"Despite the seasonal impact on revenues for our first quarter and a general increase in expenses as we continue to grow our infrastructure, we were able to achieve modest profitability," comments Juliet Jones, Chief Financial Officer of WebTech Wireless Inc. "We significantly built our inventory levels during the quarter in anticipation of several large opportunities that will require this additional capacity and infrastructure."

The Company announces that it will hold a conference call on December 14, 2006 at 5:00 PM Eastern Time and that a recording of the conference call will be posted on the Company's website at www.webtechwireless.com within 24 hours of the call. Interested parties may participate in the call by dialing 1-800-633-8761 or 416-641-6702 (international callers). The financial statements and management's discussion and analysis will be posted on the Company's website prior to the conference call. Further information on the Company may also be viewed at www.sedar.com.

About WebTech Wireless Inc.

WebTech Wireless Inc. (TSX VENTURE:WEW) is a global Telematics, location-based services provider that develops, manufactures, and delivers turnkey wireless solutions designed to improve productivity and profitability. WebTech products include wireless hardware and software services running on cellular and satellite networks, and include Automatic Vehicle Location, Mapping, Reporting, Vehicle Maintenance, Driver Status, In-vehicle Telemetry, Messaging, In-vehicle Navigation, and wireless application and Internet connectivity. WebTech is currently providing devices and services worldwide in eight languages to over forty-one countries covering five continents. WebTech's scalable solutions are used by a broad range of small, medium, Fortune 500 companies and governments. For more information, please visit www.webtechwireless.com.

Forward-Looking Statements

This press release contains forward-looking statements involving risks and uncertainties pertaining to, but not limited to product plans, timing, content, and pricing of products, market and industry expectations, the wireless communications industry, the mobile fleet industry, and general economic and political conditions. Given the risks and uncertainties inherent in the markets and industries referred to in this press release, WebTech cannot guarantee that any forward-looking statements will be realized.

Trademarks are the property of their owners.



WEBTECH WIRELESS INC.
CONSOLIDATED BALANCE SHEETS

(amounts in 000's)
October 31, 2006 July 31, 2006
---------------- --------------
(unaudited) (audited)

ASSETS
Current Cash & cash equivalents $ 7,909 $ 10,640
Accounts receivable 7,285 7,015
Inventory 4,759 2,849
Prepaid expenses and deposits 1,518 800
---------------- --------------

21,471 21,304
---------------- --------------

Capital Assets 744 738
Intangible assets 316 292
---------------- --------------

$ 22,531 $ 22,334
---------------- --------------
---------------- --------------

LIABILITIES
Current
Accounts payable and accrued
liabilities $ 1,964 $ 2,198
Deferred revenue 380 294
---------------- --------------

2,345 2,492
---------------- --------------

SHAREHOLDERS' EQUITY
Share capital 21,445 21,105
Contributed surplus 544 574
Deficit (1,803) (1,837)
---------------- --------------

20,186 19,842
---------------- --------------

$ 22,531 $ 22,334
---------------- --------------
---------------- --------------

APPROVED BY THE DIRECTORS:

"Anwar Sukkarie" "Cameron Fraser"
----------------------- -----------------------


WEBTECH WIRELESS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
For the Quarters Ended October 31, 2006 and 2005
(amounts in 000's except per share amounts)

2006 2005
---------------- --------------
(unaudited) (unaudited)

Sales $ 3,907 $ 2,555

Cost of goods sold 1,993 1,307
---------------- --------------

Gross profit 1,914 1,248
---------------- --------------

Expenses
Administration 443 388
Amortization 76 53
Marketing and sales 836 647
Research and development 635 403
---------------- --------------

1,990 1,491
---------------- --------------

Loss before other items (76) (243)

Other items
Interest Income 88 2
Foreign exchange gain (loss) 22 (90)
---------------- --------------

Net income (loss) for the period $ 34 $ (331)
---------------- --------------

Basic earnings (loss) per share $ 0.00 $ (0.01)
---------------- --------------
---------------- --------------

Fully diluted earnings (loss) per share $ 0.00 $ (0.01)
---------------- --------------
---------------- --------------

Weighted average number of common
shares outstanding 42,290,339 34,951,230
---------------- --------------
---------------- --------------


WEBTECH WIRELESS INC.
CONSOLIDATED STATEMENTS OF DEFICIT
For the Quarters Ended October 31, 2006 and 2005
(amounts in 000's except per share amounts)

2006 2005
---------------- --------------

Deficit, beginning of the period $ (1,837) $ (2,941)
Income (loss) for the period 34 (331)

---------------- --------------

Deficit, end of the period $ (1,803) $ (3,272)
---------------- --------------
---------------- --------------


WEBTECH WIRELESS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Quarters Ended October 31, 2006 and 2005
(amounts in 000's)

2006 2005
---------------- --------------
(unaudited) (unaudited)
Operating Activities
Net income for the period $ 34 $ (331)
Add items not affecting cash:
Stock based compensation 45 38
Amortization 76 53
---------------- --------------

155 (240)
Changes in non-cash working capital
items related to operations:
Accounts receivable (270) 307
Inventory (1,910) (396)
Prepaid expense and deposits (718) (183)
Accounts payable and accrued liabilities (234) 258
Deferred revenue 86 27
---------------- --------------

(2,890) (227)
---------------- --------------

Financing Activities
Common shares issued, net of costs 265 3,458
Due to directors - 1
---------------- --------------

265 3,459
---------------- --------------
Investing Activities
Purchase of intangible assets (36) (27)
Purchase of capital assets (70) (109)
---------------- --------------

(106) (136)
---------------- --------------

Net increase (decrease) in cash
during the period (2,731) 3,096

Cash and cash equivalents,
beginning of period 10,640 1,072
---------------- --------------

Cash and cash equivalents,
end of period $ 7,909 $ 4,168
---------------- --------------
---------------- --------------

Cash and cash equivalents consist of:
Cash $ 1,409 $ 1,418
Term deposits 6,500 2,750

---------------- --------------
$ 7,909 $ 4,168
---------------- --------------
---------------- --------------

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

Contact Information