Colonial Data Technologies Corp. reports revenues and earnings for second quarter 1996.

NEW MILFORD, Conn.--(BUSINESS WIRE)--Aug. 7, 1996--Colonial Data Technologies Corp. ("CDT") (Nasdaq:CDTX) today reported financial results for the second quarter ended June 30, 1996.

For the quarter ended June 30, 1996, revenues were $18,694,000, an increase of 2% as compared to $18,308,000 for the same period last year. Net income for the quarter decreased 3% to $1,955,000 compared with $2,825,000 a year earlier. Net income per share for the quarter was $0.13, compared with $0.21 for the same period in 1995, on increased outstanding shares. The weighted average common shares outstanding were 15,593,227 and 13,757,353 for the second quarter of fiscal 1996 and 1995, respectively. For the three months ended June 30, 1996, gross profit and operating margins were 32% and 14%, respectively, compared with 41% and 25% for the same period last year.

Revenues for the six months ended June 30, 1996 were $37,608,000, an increase of 12% compared to $33,514,000 for the same period in 1995. Six month net income for 1996 was $4,706,000 or $0.30 per share, compared with $5,239,000 or $0.38 per share for the same period in 1995. Weighted average common shares were 15,605,588 and 13,719,494 for the six months ended June 30, 1996 and 1995, respectively.

The Company attributed the decrease in earnings primarily to lower lease-related gross profit and an increase in operating expenses. Robert J. Schock, Chairman, President and Chief Executive Officer stated, "The Company remains focused on providing end-to-end solutions to our primary customers, the regional Bell and other telephone operating companies. Mr. Schock added, "The Company's recently announced agreement to merge with US Order, Inc., the closing of which is subject to certain conditions, provides an excellent platform from which to expand our current product lines, providing a high-end smart telephone, recurring revenue from information services, and expertise in the electronic commerce arena, which, with the advent of smart cards, will cross over into our information appliance market. In addition, US Order's Intelifone, which has been well received in the retail market, will provide us a full line of information appliances to offer to retailers, including Caller ID adjunct units, feature phones, cordless Caller ID phones, smart phones, and home office and small business systems. We look forward to packaging US Order's information services with our information appliance line and building a satisfied subscriber base."

Colonial Data Technologies Corp. designs, develops and markets telecommunications products that support intelligent network services being developed and implemented by leading domestic and international telephone operating companies. The Company has concentrated its product development and marketing efforts on products that support Caller ID and other emerging intelligent network services. The Company markets an ADSI smart phone, Telesmart 4000, which provides consumers call management features and major new advances in interactive applications via telephone. Through its subsidiaries, the Company distributes small business systems with the Landmark trademark and high-end consumer equipment, including advanced cordless products. The Company also repairs and refurbishes telecommunications products for commercial customers and provides services that support the development and implementation of intelligent network services.

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995:

This release contains forward looking statements that are subject to risks and uncertainties, including, but not limited to, the impact of competitive products and pricing, product demand and market acceptance, new product development, reliance on key strategic alliances, availability of raw materials, the telecommunications regulatory environment, fluctuations in operating results and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission. -0-

COLONIAL DATA TECHNOLOGIES CORP.
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(In thousands, except per share data)

                                   Three Months Ended   Six Months Ended
                                         June 30,           June 30,
                                     1996      1995      1996      1995
Revenues:
   Products                        $14,719   $12,478   $29,241   $22,180
   Leases                            3,472     5,395     7,417    10,188
   Services                            503       435       950     1,146
Total Revenues                      18,694    18,308    37,608    33,514

Cost of sales                       12,672    10,804    24,369    19,905

Gross profit                         6,022     7,504    13,239    13,609

Operating Expenses:
   General and administrative        1,576     1,358     3,130     2,390
   Selling and marketing             1,366     1,259     2,840     2,216
   Research and development            386       367       756       645
Total operating expenses             3,328    2,984      6,726     5,251

Income from operations               2,694     4,520     6,513     8,358
Other income, net                      460       189     1,150       375
Income before income taxes           3,154     4,709     7,663     8,733
Income taxes                         1,199     1,884     2,957     3,494

Net income                         $ 1,955   $ 2,825   $ 4,706   $ 5,239
Net income per share             $     .13 $     .21 $     .30 $     .38
Weighted average shares             15,593    13,757    15,606    13,719

                      COLONIAL DATA TECHNOLOGIES CORP.
                   CONSOLIDATED CONDENSED BALANCE SHEETS
                               (In thousands)

                                        June 30, 1996   December 31, 1995
Assets:

Cash and marketable securities               $30,096            $31,632
Accounts receivable                           14,956             16,069
Inventories                                   31,908             26,512
Other current assets                           1,395                539
Total current assets                          78,355             74,752
Noncurrent assets                              9,269             11,653
Total assets                                 $87,624            $86,405

Liabilities and stockholders' Equity:

Current liabilities                          $ 3,230            $ 5,837
Stockholders' equity                          84,394             80,568
Total liabilities and stockholders' equity   $87,624            $86,405

CONTACT: John N. Giamalis

Chief Financial Officer

[phone]

or

Investor Relations Contact:

Donna Stein/Evan Smith/Keil Decker

Morgen-Walke Associates, Inc.

212-850-5600

Press:Lee Foley/Jennifer Rutter

212-850-5600