BAB, Inc. Reports Profit for 1st Quarter FY 2007.

DEERFIELD, Ill. -- BAB, Inc. (OTCBB: BABB), the Deerfield based operator and franchisor of Big Apple Bagels, My Favorite Muffin and Brewster's Coffee, today announced its financial results for the first quarter ended February 28, 2007, reporting net income of $121,000, or $0.02 per share, versus a restated amount of $94,000, $0.01 per share, for the same quarter last year.

The Company had to restate its quarter ending February 28, 2006 in order to compare results to the current year's same quarter as a result of adopting SEC Staff Accounting Bulletin No. 108 (SAB 108). SAB 108 required the Company to expense professional fees in the period the services are rendered, whereas, prior to its adoption, these expenses were accrued for in the fiscal year they pertained to. Therefore, in order to compare results for the quarter ended February 28, 2007, to the same quarter in 2006, we had to restate the 2006 quarter. This resulted in selling, general and administrative expenses for the quarter ending February 28, 2006, increasing by $22,000 with a corresponding decrease in net income by $22,000, or $0.01 per share.

For the quarter ended February 28, 2007, BAB had revenues of $951,000 and net income of $121,000, or $0.02 per share, versus revenues of $976,000 and net income of $94,000, or $0.01 per share for the quarter-ended February 28, 2006.

Total operating expenses of $843,000 were down 4% from $875,000 for the same period in 2006. Total operating expenses as a percent of revenues were 88.7% for the 2007 quarter versus 89.6% in 2006.

The Company's total debt as of February 28, 2007 was $381,000 versus $651,000 as of February 28, 2006.

BAB, Inc. operates, franchises, and licenses Big Apple Bagels [R], My Favorite Muffin [R] and Brewster's [R] Coffee. The Company's stock is traded on the OTCBB under the symbol BABB and its web site can be visited at www.babcorp.com.

Certain statements in this press release constitute forward-looking statements or statements which may be deemed or construed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The words "forecast," "estimate," "project," "intend," "expect," "should," "would," "believe" and similar expressions and all statements which are not historical facts are intended to identify forward-looking statements. These forward-looking statements involve and are subject to known and unknown risks, uncertainties and other factors which could cause the company's actual results, performance (financial or operating), or achievements to differ from the future results, performance (financial or operating), or achievements expressed or implied by such forward-looking statements. The above factors are more fully discussed in the company's SEC filings.

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