Advanced Systems International Announces Year End Results.

Business Editors

SOUTHFIELD, Mich.--(BUSINESS WIRE)--July 25, 2001

Advanced Systems International, Inc. (OTC: ADSN) today announced results for the year ended December 31, 2000 and restated results for the year ended December 31, 1999.

Revenues amounted to $5,294,771, in fiscal 2000 and $6,382,526 in fiscal 1999, as restated, representing a decrease of 17%. The Company had consolidated gross profits of $3,545,673 (67.0% of total revenues) and $4,260,277 (66.8% of total revenues) in fiscal 2000 and 1999, as restated, respectively. Operating expenses amounted to $8,433,804 and $5,673,527 in fiscal 2000 and 1999, respectively. This increase was primarily due to the growth in the number of employees and a $1,005,070 one-time, non-cash expense for options exercised. The Company had a net loss of $5,344,474 for fiscal 2000, as compared with a restated net loss of $1,621,776 in fiscal 1999.

Management attributed the decline in revenue and increase in costs to two key market factors. The Company experienced an unusually high rate of growth in new projects in 1999 due to the fact that it was the first full year marketing its ATServer solution combined with the sales push caused by Year 2000 compliance issues. The Y2K issue resulted in fewer projects and an industry-wide slowdown in new business initiatives in 2000. Second, in 2000 the Company expended a significant proportion of its resources rationalizing the growth it experienced in 1999. In addition, the development of new products and vertical markets brought with them their own set of challenges and complexities to overcome.

"We anticipate a return to growth toward the end of this year as the market conditions improve and as businesses are forced to refocus on operational efficiency systems that reduce the cost of labor and information flow. Demand for additional implementations from our customer base and tighter strategic alliances with industry leaders, such as EDS and Sabre, should fuel this growth. We are looking to build on existing installations at several Fortune 1000 Companies, in industries such as Airlines and Transportation, Automotive Supply, Food Processing, Entertainment, Pulp and Paper Processing. We have experienced successful entrance in the foregoing markets and enhanced long-term growth potential by integrating and web-enabling ATServer and ATLink into an overall suite of solutions for our customers," stated Gerry Pesut, President and CEO 

"In addition, ADSN has implemented aggressive cost cutting programs. New marketing and integration alliances have allowed the Company to introduce lower cost sales and implementation models,"

"Fiscal 2000 was a year of transition and challenge for ADSN. Although changing our revenue recognition policy and restating our prior years results caused a delay in releasing our financial statements, we are now firmly on track. We plan to regain our trading status on the Over-the-Counter Bulletin Board as expeditiously as possible," Pesut concluded.

In conjunction with the provisions of the "Safe Harbor" section of the Private Securities Litigation Reform Act of 1995, this news release may contain forward-looking statements pertaining to future anticipated projected plans, performance and developments, as well as other statements relating to future operations. All such forward-looking statements are necessarily only estimates of future results and there can be no assurance that actual results will not materially differ from expectations. Further information on potential factors that could affect Advanced Systems International, Inc. is included in the company's Form 10KSB filed with the Securities and Exchange Commission.