AccelPath Inc. (fka ACLP)

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Technest Holdings Reports Financial Results for Three Months and Nine Months Ending March 31, 2007
Monday May 14, 7:00 am ET


BETHESDA, MD--(MARKET WIRE)--May 14, 2007 -- Technest Holdings, Inc. (OTC BB:TCNH.OB - News), a defense and homeland security company, announced today its operating results for the Company's third quarter and nine months ended March 31, 2007. The complete filing is available at www.sec.gov.

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 2007 compared to a net loss of $1.52 million or $0.10 per share in the third quarter of 2006. For the nine months ending March 31, revenues were $53.67 million vs. $55.14 million for the same nine months in 2006. Gross profit for the nine months in 2007 was $11.00 million compared to $10.30 million during the same period in 2006. The operating loss for the nine month period was $1.59 million compared with $1.08 million for the same period a year ago. The net loss attributable to common shareholders for the nine months ended March 31, 2007 was $4.67 million or $0.28 per share in 2007 compared to a net profit of $21.73 million or $1.36 per share in the same nine months in 2006. The net profit in 2006 was due primarily to a non-cash derivative income in the amount of $25.05 million representing the change in fair value of certain warrants issued by Technest in February 2005. Non-cash charges included in the loss for the nine months ended March 31, 2007 were $5.59 million and net non-cash income for the same period in 2006 was $21.61 million.

Dr. Joseph Mackin, President and CEO, Technest Holdings, commented, "Overall, we are pleased with our third quarter, where our gross profit improvement was due to a larger percentage of high margin services provided compared with lower margin material procurement contracts. Our funded backlog remains strong at over $44 million and we have additional awarded but as yet unfunded contracts in excess of $122 million. Going forward, we expect to execute additional military contracts in the fourth quarter that have been previously awarded but are awaiting processing. These processing delays were the primary cause of our shortfall in revenue in the nine months ended March 31, 2007 compared to the previous year."

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

Pursuant to an agreement beginning May 15, 2007, Consulting For Strategic Growth1, Ltd. ("CFSG1") provides Technest Holdings, Inc. with consulting, business advisory, investor relations, public relations and corporate development services. Independent of CFSG1's receipt of cash compensation from Technest Holdings, CFSG1 may choose to purchase the company's common stock and thereafter liquidate those securities at any time it deems appropriate to do so.