September 24 , 2007
New Mexico Software Shareholder Update
Company Projects Positive Cash Flow in Second Half of 2007
ALBUQUERQUE, NM, September 24-- New Mexico Software, Inc. (OTC Bulletin Board: NMXC), www.nmxc.net, a leading provider of web-based digital and paper management solutions, today announced continuing improvement from the first and second quarters of fiscal 2007 in its third quarter financial results. The company cited an improved balance sheet and a tighter cost structure with the retirement of long-term debts. The company said revenue will remain basically flat for the year, reflecting the ongoing replacement of one-off sales with recurring revenue streams.
Financial results for the third quarter will be announced during the 45 days after the close of the quarter on September 30.
New Mexico Software CEO Dick Govatski said, “The recurring revenue plan has met our expectations and the current cash situation has made it easier to acquire new customers and integrate them into our structure without adding additional overhead. We knew when we changed our business model in January 2006 that it would take some time to build a strong recurring revenue model. I am hopeful we will be able to show positive cash flow and possibly profitability by 2008.
“During 2006, more than 35% of our monthly operating cash was used to pay down old liabilities, particularly the past-due obligation to the IRS. In early 2007, we finished paying off our IRS obligation. The result was a 14% improvement in monthly cash flow, compared with 2006. The net effect is that monthly cash available for current operations and new business during the first nine months of 2007 has improved by approximately 75% over 2006.
“We remain on schedule with our goal of reducing our total liabilities by 50% by the end of the third quarter. With the exception of one account, all of our past long-term liabilities will be retired at that time, freeing the remaining cash flow to be used in growing our business.
“I am encouraged by the new medical business being booked for the fourth quarter of 2007. We’ll be exhibiting our DDS-EXpress dental system at the American Dental Association Convention in San Francisco this week from September 27 through September 29 at Moscone Hall, booth 2020. We’ll also be in Las Vegas from October 10 through October 12 at the National Association of Portable X-Ray Providers (NAPXP) Convention. The company is beginning to build sales momentum. Two long-standing XR-EXpress customers have established contracts with jail systems on the West Coast and in the Southeast that will have a significant positive impact on monthly recurring revenues. The number of hosted customers is growing on a regular basis.”
Information about the ADA convention can be found at http://www.ada.org. For more information about the NAPXP convention, please visit http://www.napxp.org.
About New Mexico Software
New Mexico Software is a leading provider of information management solutions that significantly improve the interface between the paper world and the digital world, facilitating a true paperless environment. It is the only public company providing web-based integrated services for individuals and companies, large or small, which allows full access to data from anywhere in an easy-to-use, familiar browser environment at an affordable price. For more information, visit either www.nmxc.net or www.nmxs.com, or contact Dick Govatski, president and CEO, at (505) 255-1999 or ceo@nmxs.com .
An investment profile on New Mexico Software may be found at Hawk Associates. For an online investor relations kit, visit www.hawkassociates.com or www.americanmicrocaps.com. For more investor-related questions, contact Frank Hawkins, Hawk Associates, at (305) 451-1888 or info@hawkassociates.com.