ATEC Group, Inc. Reports Third Quarter Results; Company Marks 17th Consecutive Quarter of Positive Earnings and Gross Profits Hit Record Highs.

HAUPPAUGE, N.Y.--(BUSINESS WIRE)--May 13, 1999--

ATEC Group, Inc. (Nasdaq:ATEC) Thursday announced that revenues for the nine months ended March 31, 1999 totalled $90,457,405 compared to revenues of $114,490,400 reported for the nine months ended March 31, 1998.

Net income for the current nine month reporting period was $284,884, or $.04 per share, compared to $1,635,026, or $.28 per share, posted for the same period in 1998. Significant, is the increase in gross profits for the nine month period which expanded from $8.6 million last year to $9 million for the nine months ended March 31, 1999, despite decreased revenues.

For the three months ended March 31, 1999, the Company reported revenues of $22,839,467, a decrease from revenues of $45,278,978 reported for the three months ended March 31, 1998. Net income decreased to $60,596, or $.01 per share, compared to net income of $697,748, or $.12 per share, earned during the three month reporting period in 1998. Also noted, was the increase in gross profits to $3.2 million this quarter versus $3.1 million for the same period a year ago. Margins doubled to 14% from 7%, due to a considerable contribution from our software and service divisions.

Surinder Rametra, CEO and Chairman of ATEC Group, Inc., stated: "We recognized nearly a year in advance that the entire systems integration/VAR market would be subject to a sweeping paradigm shift and the way that computer manufacturers conducted business would dramatically change. We were right, and we were ready. The recent announcement from COMPAQ (NYSE:CPQ) stating that they are reducing their selling group to just 4 VARs, illustrates the timeliness of our decision. We have invested considerable time, effort and money in implementing a new and comprehensive business plan which provides for mass diversification of operations and focus, results are being realized in higher gross profits. Although top line revenue and bottom line profitability may have been temporarily and negatively impacted, we believe that the steps taken to develop new products, to aggressively implement an internal manufacturing initiative, and to significantly expand our points of distribution will result in long term, profitable opportunities for the Company. In fact, unlike others unprepared for this dynamic industry shift, ATEC is in a firm position to achieve stable, yet aggressive, revenue and earnings growth as we move into the new millennium."

Continuing, Rametra added: "Despite the strategic investment we've made in ATEC's future growth, I am pleased to report that the third quarter of 1999 represents the 17th consecutive profitable quarter in our corporate history. This is, in our opinion, an extraordinary feat for such a young company operating in the high technology industry."

Jim Charles, Chief Financial Officer of ATEC Group, Inc., noted: "The purchase of Nexar Technologies is just one example of how ATEC is repositioning itself for future growth. The $1 million invested in this acquisition permits ATEC to achieve 15% gross margins by manufacturing our own product lines, instead of realizing less than 8% by reselling other manufacturers' hardware. Aside from the obvious contribution this should make to our bottom line profitability, it is creating enormous opportunity for revenue growth. To illustrate, within one month of acquiring Nexar, we announced the sale of 2,000 of our new personal computers, which accompanied a backlog of over 3,000. Having previously projected $100 million in revenue for fiscal 2000 from NEXAR, our $1 million investment would represent a phenomenal Return on Equity for our shareholders."

Concluding, Charles said: "Upon successful completion of the proposed merger with Wareforce.com, ATEC will possess a comprehensive, national market presence. Given that Wareforce's client base includes prolific corporate, educational and governmental customers, we intend to exploit our Nexar computer brand via an aggressive cross-marketing campaign to leverage sales growth and rapid increase in marketshare within the professional sector. Then, when factoring in the membership only, e-commerce site, uMember.com, of which Wareforce holds a 70% controlling interest, ATEC immediately accesses the global consumer market - to which it intends to directly market the Nexar product. Collectively, this represents a potential market of five million new ATEC customers. To say that we are moving forward aggressively, yet intelligently, is a gross understatement as far as we are concerned."

Headquartered in Hauppauge, New York, ATEC Group, Inc. is a leading system integrator and provider of a full line of information technology products and services to business, professionals, government agencies and educational institutions. ATEC offers leading computer hardware, software, connectivity devices, multimedia products, data communication via satellite, video conferencing, Internet, Internet and Y2k solutions to their clients. -0-

                           ATEC GROUP, INC.
                   Financial Highlights (Unaudited)

                       For the Three Months    For the Nine Months
                              Ended                   Ended
                          March 31, 1999          March 31, 1999
                        1999         1998       1999         1998

Net Revenues         $22,839,467 $45,278,978 $90,457,405 $114,490,400

Net Income           $    60,596 $   697,748 $   284,884 $  1,635,026

Net Income Per Share
  Basic                      .01         .12         .04          .28
  Diluted                    .01         .12         .04          .28

Common And Common
 Equivalent Shares
  Basic                6,956,605   5,874,757   6,956,605    5,906,330
  Diluted              8,201,818   5,874,757   7,976,312    5,906,330

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements which are not historical facts contained in this press release are forward-looking statements that involve certain risks and uncertainties including but not limited to risks associated with the uncertainty of future financial results, additional financing requirements, development of new products,government approval processes, the impact of competitive products or pricing, technological changes, the effect of economic conditions and other uncertainties detailed in the Company's filings with the Securities and Exchange Commission.