1MAGE Software reports 79% third quarter increase.

ENGLEWOOD, Colo.--(BUSINESS WIRE)--Nov. 13, 1996--1MAGE Software Inc. (NASDAQ:ISOL) today announced results for its third quarter ended Sept. 30, 1996.

1MAGE Software reported revenue of $564,904 for the three months ended Sept. 30, 1996, compared to revenue of $315,605, reported for the same period one year ago. The net income for the third quarter of 1996 was reported to be $6,737, vs. a net loss of $633,704 in the same quarter last year.

David DeYoung, president of 1MAGE Software, stated: "We are pleased with the continued progress shown by the third quarter results. The 79% increase in quarterly revenue is primarily due to a 261% increase in sales of 1MAGE software, which is now being sold through newly recruited VARs, as well as directly to end-users in a variety of different industries.

"At the same time, we are seeing increased levels of recurring revenues as a result of our emphasis on continuous support and product updates to our existing customers. Cost-cutting measures, started in 1995, have begun to show results (40% decrease over 9 months), as we strive to bring expenses in line with revenues. The positive turnaround of $1,131,843 in the company's profitability in 1996 has led management to believe that the company is properly sized for its current business level and poised for growth in the near future."

Some of these statements contained in this news release are forward-looking statements. The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks including, but not limited to, future economic conditions, competitive products and pricing, new product developments, the delivery of products under existing contracts and other factors.

1MAGE(tm) is a comprehensive UNIX-based electronic document management and retrieval system developed by 1MAGE Software Inc. of Englewood. The company's software automates the document filing process, routes documents through a company's approval process automatically, tracks the location of a specific document, archives the document in a systematic electronic storage procedure, and manages the flow of incoming and outgoing documents throughout an organization. Over the next five years, industry experts project imaging systems to grow at a rate of 35% to 50% per year.

For additional information contact 303/773-1424. -0-

                                        Earnings Recap

                       Third Quarter Ended       Nine Months Ended
                             Sept. 30                 Sept. 30
                        1996        1995          1996        1995

Revenue           $  564,904  $  315,605   $ 1,534,863  $ 2,299,738
Net income (loss) $    6,737  $ (633,704)  $    85,576  $(1,046,267)
Income (loss)
 per share        $      .00  $     (.33)  $       .04  $      (.55)
Weighted avg.
 shares
 outstanding       2,129,563   1,910,110     2,023,763    1,899,025

CONTACT: 1MAGE Software Inc., Englewood

Michelle Chase, 303/773-1424, ext. 128