Paulson Capital (PLCC)

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Paulson Capital Corp. Announces 2007 First Quarter Results


Company Reports Net Income of $0.45 Earnings per Share; Management to Host Teleconference Tomorrow Afternoon Beginning at 4:15 PM ET

PORTLAND, OR, May 14, 2007 (MARKET WIRE via COMTEX) -- Paulson Capital Corp. (PLCC), parent company to Paulson Investment Company, Inc., today announced its financial results for the three months ended March 31, 2007.

Financial Highlights for Three Months Ended March 31, 2007 Compared to Three Months Ended March 31, 2006:

-- Total revenues climbed to $9.7 million compared to total revenues of ($958,000).-- Sales commissions and salaries remained relatively unchanged at $4.0 million.-- Corporate finance revenues increased 1779% to $996,000 from $53,000.-- Investment income rose to $3.2 million compared to investment losses of $5.2 million.-- Trading income increased 3662% to $1.3 million from $36,000.-- Income before taxes was $4.5 million compared to a loss before taxes of $5.7 million.-- Net income totaled $2.8 million, or $0.45 earnings per basic and diluted share, compared to a net loss of $3.5 million, or $0.57 loss per basic and diluted share.

As of March 31, 2007, the Company had $12.4 million in cash and receivables and $37.3 million in total shareholders' equity. The value of the Company's trading securities, investment securities and underwriter warrants was $29.7 million. During the 2007 first quarter period, the Company repurchased a total of 37,500 shares of its common stock under the stock repurchase program approved by the Board in September 2001.

Chester L.F. Paulson, founder and Chairman of Paulson, stated, "Our strong first quarter results are primarily a reflection of the favorable market conditions that have helped to restore and enhance value in our proprietary investment and trading accounts. In addition, with the completion of our initial public offering for Converted Organics, we saw a sizable gain in our corporate finance revenues. Overall, we're very proud of our performance and hope that we can continue this success in coming quarters."

The Company will host a teleconference tomorrow afternoon, Tuesday, May 15, 2007, beginning at 4:15 PM Eastern Time and invites all interested parties to join management in a discussion regarding the Company's financials, corporate progress and other developments. The conference call can be accessed by dialing toll-free 1-800-867-0448. For those unable to participate at that time, a replay of the teleconference can be accessed domestically by dialing 1-800-405-2236 and enter the passcode 11090156#. The replay will be available for 30 days.