Q3 Results Continue Improvement in Key Performance Indicators
5/15/2007 12:00:00 AM

  ADVANTEX ANNOUNCES RESULTS FOR Q3 2007
AND CONTINUED IMPROVEMENT IN KEY PERFORMANCE INDICATORS

For Immediate Release
ADX: TSX

Toronto, May 15, 2007 - Advantex Marketing International Inc. (TSX:ADX) today reported results for the three and nine months ended March 31, 2007. All key performance indicators continued to show significant improvement compared to the same period in the previous year.

• Net Revenue of $2.7 million; Up $0.8 million or 41.5%
• Gross Profit of $1.9 million; Up $0.5 million or 38.8%
• Net Loss of $0.4 million; An improvement of $0.2 million
• Transaction Credits of $6.1 million; Up $2.2 million compared to June 30, 2006
• YTD operating profit of $0.2 million for fiscal 2007, a $1.2 million improvement from the $1.0 million operating loss reported for the same period in the previous year.

“Q3 is historically our weakest reporting period due to decreases in consumer spending levels after the December holidays, and yet Advantex remained on its course towards profitability. Every quarter of this fiscal year has shown marked improvement over the prior year,” said Mr. Kelly Ambrose, President and Chief Executive Officer of Advantex. “The majority of our success is attributable to the growth of our Advance Purchase Marketing Programs and our focus on cost containment.”

The Company is following a two-fold plan to continue improving its financial performance:

1. Maximizing the amount deployed as Transaction Credits under its CIBC program. Transaction Credits are a good indicator of future revenue. The Company is actively working to raise additional debt financing to fund future growth of Transaction Credits.
2. Working with its Airline channel partners to develop the Online Shopping Mall business further.

 The following presentation is not in accordance with Canadian GAAP disclosures, but has been included to provide a more useful analysis to the reader.

(In millions of dollars)		Q3*			YTD*
		F 2007	F 2006		F 2007	F 2006
Gross Revenue:
CIBC program                Advance Purchase Model		$ 22.0	$ 14.7		$ 62.0	$ 48.7
Marketing Only Model		0.4	0.2		1.3	0.7
Online Shopping Malls		0.6	0.5		2.0	1.7
Gross Revenue from Core Activities		23.0	15.4		65.3	51.1
Other programs		0.0	0.0		0.2	0.2
Total Gross Revenue		23.0	15.4		65.5	51.3
Cost of Purchasing Transaction Credits For Advance Purchase Model		(20.3)	(13.5)		(57.1)	(44.9)
Net Revenue		2.7	1.9		8.4	6.4
Direct Expenses		(0.8)	(0.5)		(2.8)	(2.2)
Gross Profit		1.9	1.4		5.6	4.2
Ongoing selling, general & administrative expenses		(1.9)	(1.6)		(5.4)	(5.2)
Operating Profit (Loss) before restructuring		$ 0.0	$(0.2)		$ 0.2	$(1.0)
Amortization and Interest		(0.4)	(0.3)		(0.8)	(0.8)
Profit (Loss) before restructuring		$ (0.4)	$(0.5)		$(0.6)	$(1.8)
Restructuring Costs		(0.0)	(0.0)		(1.0)	(0.3)
Net Loss, continuing operations		$(0.4)	$(0.5)		$(1.7)	$(2.0)
Discontinued operations		-	-		-	0.1
Net Loss		$(0.4)	$(0.5)		$(1.7)	$(2.0)

    *Some numbers may not add due to rounding

Net Revenue (defined as Gross Revenue less the Cost of Purchasing Transaction Credits) for Q3 2007 was $2.7 million, an increase of 41.5% over the corresponding quarter in the previous year. This growth reflects the positive impact of the increase in assets deployed in the Company’s Advance Purchase Marketing Programs, leading to an increase in Net Revenue from the Company’s CIBC programs of 48.5% over the corresponding quarter in the previous year.

Gross Profit was $1.9 million in the quarter compared to $1.3 million for the same quarter last year. This growth is principally the result of expanding the Advance Purchase Marketing program.

The reported Net Loss of $359,000 ($ 0.00 per share) for Q3 2007 is an improvement of $182,000 compared to the reported Net Loss of $541,000 for the same period a year ago.

For the six-month period ending March 31, 2007, Net Revenue was $8.4 million, an increase of $2.0 million or 30.4% over the same nine-month period a year ago. Gross Profit was $5.6 million, an increase of $1.4 million or 32.3% over the same nine-month period a year ago. The year-to-date Loss before Amortization and Interest was $0.9 million and Net Loss was $1.7 million versus $1.3 million and $2.0 million respectively in the previous year. However, excluding restructuring costs in both years and earnings from discontinued operations in 2006, the Company shows year-to-date earnings of $0.2 million before amortization and interest and a year-to-date net loss of $0.6 million, both improving $1.1 million from the same nine-month period last year.

Working Capital was $3.7 million at the end of June 30, 2006 and $4.4 million at the end of March 31, 2007. During the nine month period, the Company raised net proceeds of $1.6 million from Convertible Debenture closing and deployed available funds to support the growth of its Advance Purchase Marketing program, resulting in increased revenue for the period. This course of action is reflected on the Balance Sheet as a decrease in Cash and Cash Equivalents ($0.5 million at March 31, 2007 compared to $1.8 million at June 30, 2006), and an increase in Transaction Credits ($6.1 million at March 31, 2007 versus $3.9 million at June 30, 2006). Transaction Credits are a good indicator of future revenue.

About Advantex Marketing International Inc.

Advantex Marketing International Inc. is a leading marketing services company, specializing in Advance Purchase Marketing Programs for merchants, coalition loyalty rewards programs, and Online Shopping Malls. Advantex loyalty partners include CIBC, United Airlines, Delta Air Lines, The New York Times, and other major North American corporations, as well as a growing list of restaurants, retailers, golf courses, boutique hotels, inns, resorts and spas.  Advantex is a public company, traded on the Toronto Stock Exchange under the symbol "ADX". For additional information on Advantex, please visit www.advantex.com.

This Press Release contains certain "forward-looking statements". All statements, other than statements of historical fact, that address activities, events or developments that the Company believes, expects or anticipates will or may occur in the future (including, without limitation, statements regarding financial and business prospects and financial outlook) are forward-looking statements. These forward-looking statements reflect the current expectations or beliefs of the Company based on information currently available to the Company. Forward-looking statements are subject to a number of risks, uncertainties and assumptions that may cause the actual results of the Company to differ materially from those discussed in the forward-looking statements, and even if such actual results are realized or substantially realized, there can be no assurance that they will have the expected consequences to, or effects on the Company. Factors that could cause actual results or events to differ materially from current expectations include, among other things, changes in general economic and market conditions, changes to regulations affecting the Company's activities and uncertainties relating to the availability and costs of financing needed in the future. Any forward-looking statement speaks only as of the date on which it is made and, except as may be required by applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking statement, whether as a result of new information, future events or results or otherwise. Although the Company believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein.

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