Integrity Reports Record Earnings For the First Quarter of 2001; Company Announces New Credit Relationship With LaSalle Bank N.A.

Apr 30, 2001, 01:00 ET from Integrity Incorporated

    MOBILE, Ala., April 30 /PRNewswire/ -- Integrity Incorporated
 (Nasdaq: ITGR) today reported record sales and earnings for the first quarter
 of 2001.
     For the three months ended March 31, 2001, the Company reported that its
 net income increased to $1,309,000, or $0.23 per basic share, compared with
 $167,000, or $0.03 per basic share, in the first quarter of 2000.  Sales for
 the most recent quarter increased by over 50% to $20.9 million, versus
 $13.9 million in the same period in 2000.
     P. Michael Coleman, Integrity's Chief Executive Officer, noted that the
 increase in sales was mostly attributable to the success of its Songs 4
 Worship continuity series, a joint agreement with Time Life Music that was
 rolled out late in the fourth quarter of 2000.  "This series continues to
 generate unprecedented consumer response and reaffirms our long-held belief
 that Praise and Worship music appeals to a broad audience throughout America,"
 commented Coleman.  "During the first quarter of 2001, the first album in the
 series, Songs 4 Worship 'Shout To The Lord,' attained Platinum certification
 by the Recording Industry Association of America ("RIAA"), signifying sales of
 over one million copies.  The second album in the series, Songs 4 Worship
 'Holy Ground,' has already reached Gold certification by the RIAA, with sales
 of over 500,000 units."  Coleman noted that Songs 4 Worship has the potential
 to continue as a major contributor to Integrity's direct-to-consumer channel
 during the balance of 2001.
     Another contributor to the first quarter sales increase was the WoW
 Worship series, which in March 2001 released its third album, WoW Worship
 (Green).  Sales for the WoW Worship series during the first quarter of 2001
 approximated $3.5 million, compared with $2.8 million during the comparable
 period in 2000, with the increase primarily generated by WoW Worship (Green).
 The first album in the series, WoW Worship (Blue), attained RIAA's
 Double-Platinum certification during the first quarter of 2001, signifying
 sales of over one million two-disc sets.  WoW Worship (Blue) is the first ever
 Praise and Worship album to be designated Double-Platinum.
     "Our efforts with key partners to develop and promote successful album
 series such as Songs 4 Worship and WoW Worship have increased consumer
 awareness and helped to expand the overall market for Praise and Worship
 music," commented Coleman.
     First quarter gross profit increased 26.3% to $8.3 million, versus $6.5
 million in the same period of 2000.  As a percent of net sales, first quarter
 2001 gross profit declined to 40%, compared with 47% for the prior-year
 period, reflecting changes in revenue mix.  "While gross profit margins are
 lower on retail sales and joint venture albums than in our traditional
 direct-to-consumer business, sales and marketing costs are also lower.  We
 expect the trend of reduced gross margin percentages to continue during the
 balance of 2001.  Net income in the quarter was affected by a one-time tax
 benefit of $0.07 per basic share related to our foreign operations," commented
 Don Ellington, Chief Financial Officer of the Company.
     "Integrity generated strong cash flows from its operations in the first
 quarter of 2001, with earnings before interest, taxes, depreciation and
 amortization (EBITDA) of $3.5 million, compared with $2.2 million for the same
 period in 2000, an increase of 63.5%," continued Ellington.  Mr. Ellington
 also announced that on April 25, 2001, Integrity signed an agreement with
 LaSalle Bank N.A. for a $20 million secured credit facility, and that it has
 refinanced its previous credit facility with Bank Austria Creditanstalt.
     "We are excited about our results for the first quarter of 2001, which
 exceeded management's expectations, and our prospects for the rest of the
 year," noted Coleman.  "Songs 4 Worship should continue to build momentum, and
 we hope to further expand our relationship with Time Life Music.  We will
 continue to seek ways to grow our share of the Praise and Worship market and
 to continue strengthening our financial position so that our success may be
 reflected in greater value for our shareholders."
     Integrity Incorporated is a leading producer and publisher of Christian
 music, including praise and worship, children's and gospel.  Its audio and
 video products are sold throughout the United States and in 161 other
 countries worldwide.  The company is headquartered in Mobile, Alabama, and its
 common stock is listed on the Nasdaq SmallCap market under the symbol "ITGR."
 Information about Integrity, including financial and operating performance,
 also is available at the Company's Web site,
 www.integritymusic.com/company/indexinv.html.
     Integrity will host a conference call today at 11:30 a.m. Eastern time,
 10:30 a.m. Central time, to discuss first quarter 2001 financial and operating
 results, the outlook for the future and related issues.  To hear the
 discussion, callers should dial 1-800-431-4190 and enter pin number 8882.  The
 call will also be broadcast live on the Internet at www.vcall.com.  A replay
 of the conference call will be available through May 7, 2001, by dialing
 1-800-428-6051 and entering access number 182055.  The call will also be
 archived through May 7, 2001 at www.vcall.com.
 
     Some of the statements contained in this press release, particularly those
 anticipating future financial performance, business prospects, growth and
 operating strategies, new products and similar matters, are forward-looking
 statements that involve a number of risks and uncertainties.  For those
 statements, the Company claims the protection of the safe harbor for
 forward-looking statements contained in the Private Securities Litigation
 Reform Act of 1995.  In addition to the factors discussed above, among the
 other factors that could cause actual results to differ materially are:
 potentially changing consumer tastes and demands with respect to Christian
 music generally and praise and worship music in particular; the effect on
 operating margins of marketing and distribution costs associated with the WoW
 Worship releases; the effect on profit margins of a continued increase in the
 percentage of sales from retail sales; increases in the estimated cost of
 television advertising, including production costs and the cost of air time,
 all of which could materially affect the financial impact of the Songs 4
 Worship series and other television advertising initiatives; the public's
 interest in the Songs 4 Worship product could decline which could lead to
 revenues from the sale of these products falling significantly short of the
 Company's expectations, and the risks identified from time to time in
 Integrity's SEC reports, including, but not limited to, the report on Form
 10-K for the year ended December 31, 2000.  Any forward-looking statements
 represent our estimates only as of the date of this release and should not be
 relied upon as representing our estimates as of any subsequent date.  While we
 may elect to update forward-looking statements at some point in the future, we
 specifically disclaim any obligation to do so, even if our estimates change.
 
                  For additional information, please contact:
 
            Don Ellington, CFO of Integrity, Inc. at (334) 633-9000
                                       or
  RJ Falkner & Company, Investor Relations Counsel at (800) 377-9893 or via e-
                          mail at info@rjfalkner.com.
 
 
                             INTEGRITY INCORPORATED
                      CONSOLIDATED STATEMENT OF OPERATIONS
                       (in thousands, except share data)
 
                                                        Three Months Ended
                                                             March 31
                                                       2001           2000
 
     Net sales                                        $20,894        $13,897
     Cost of sales                                     12,620          7,349
     Gross profit                                       8,274          6,548
 
     Marketing and fulfillment expenses                 3,503          3,302
     General and administrative expenses                3,155          2,668
      Income from operations                            1,616            578
 
     Other expenses
      Interest expense, net                               156            262
      Other expenses                                       33             16
      Income before minority interest and taxes         1,427            300
     Provision for income taxes                            81            113
     Minority interest, less applicable taxes              37             20
     Net income                                        $1,309           $167
 
 
     Net income per share
      Basic                                             $0.23          $0.03
      Diluted                                           $0.21          $0.03
 
     Weighted average number of shares outstanding
      Basic                                             5,619          5,614
      Diluted                                           6,151          6,023
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X59434987
 
 

SOURCE Integrity Incorporated
    MOBILE, Ala., April 30 /PRNewswire/ -- Integrity Incorporated
 (Nasdaq: ITGR) today reported record sales and earnings for the first quarter
 of 2001.
     For the three months ended March 31, 2001, the Company reported that its
 net income increased to $1,309,000, or $0.23 per basic share, compared with
 $167,000, or $0.03 per basic share, in the first quarter of 2000.  Sales for
 the most recent quarter increased by over 50% to $20.9 million, versus
 $13.9 million in the same period in 2000.
     P. Michael Coleman, Integrity's Chief Executive Officer, noted that the
 increase in sales was mostly attributable to the success of its Songs 4
 Worship continuity series, a joint agreement with Time Life Music that was
 rolled out late in the fourth quarter of 2000.  "This series continues to
 generate unprecedented consumer response and reaffirms our long-held belief
 that Praise and Worship music appeals to a broad audience throughout America,"
 commented Coleman.  "During the first quarter of 2001, the first album in the
 series, Songs 4 Worship 'Shout To The Lord,' attained Platinum certification
 by the Recording Industry Association of America ("RIAA"), signifying sales of
 over one million copies.  The second album in the series, Songs 4 Worship
 'Holy Ground,' has already reached Gold certification by the RIAA, with sales
 of over 500,000 units."  Coleman noted that Songs 4 Worship has the potential
 to continue as a major contributor to Integrity's direct-to-consumer channel
 during the balance of 2001.
     Another contributor to the first quarter sales increase was the WoW
 Worship series, which in March 2001 released its third album, WoW Worship
 (Green).  Sales for the WoW Worship series during the first quarter of 2001
 approximated $3.5 million, compared with $2.8 million during the comparable
 period in 2000, with the increase primarily generated by WoW Worship (Green).
 The first album in the series, WoW Worship (Blue), attained RIAA's
 Double-Platinum certification during the first quarter of 2001, signifying
 sales of over one million two-disc sets.  WoW Worship (Blue) is the first ever
 Praise and Worship album to be designated Double-Platinum.
     "Our efforts with key partners to develop and promote successful album
 series such as Songs 4 Worship and WoW Worship have increased consumer
 awareness and helped to expand the overall market for Praise and Worship
 music," commented Coleman.
     First quarter gross profit increased 26.3% to $8.3 million, versus $6.5
 million in the same period of 2000.  As a percent of net sales, first quarter
 2001 gross profit declined to 40%, compared with 47% for the prior-year
 period, reflecting changes in revenue mix.  "While gross profit margins are
 lower on retail sales and joint venture albums than in our traditional
 direct-to-consumer business, sales and marketing costs are also lower.  We
 expect the trend of reduced gross margin percentages to continue during the
 balance of 2001.  Net income in the quarter was affected by a one-time tax
 benefit of $0.07 per basic share related to our foreign operations," commented
 Don Ellington, Chief Financial Officer of the Company.
     "Integrity generated strong cash flows from its operations in the first
 quarter of 2001, with earnings before interest, taxes, depreciation and
 amortization (EBITDA) of $3.5 million, compared with $2.2 million for the same
 period in 2000, an increase of 63.5%," continued Ellington.  Mr. Ellington
 also announced that on April 25, 2001, Integrity signed an agreement with
 LaSalle Bank N.A. for a $20 million secured credit facility, and that it has
 refinanced its previous credit facility with Bank Austria Creditanstalt.
     "We are excited about our results for the first quarter of 2001, which
 exceeded management's expectations, and our prospects for the rest of the
 year," noted Coleman.  "Songs 4 Worship should continue to build momentum, and
 we hope to further expand our relationship with Time Life Music.  We will
 continue to seek ways to grow our share of the Praise and Worship market and
 to continue strengthening our financial position so that our success may be
 reflected in greater value for our shareholders."
     Integrity Incorporated is a leading producer and publisher of Christian
 music, including praise and worship, children's and gospel.  Its audio and
 video products are sold throughout the United States and in 161 other
 countries worldwide.  The company is headquartered in Mobile, Alabama, and its
 common stock is listed on the Nasdaq SmallCap market under the symbol "ITGR."
 Information about Integrity, including financial and operating performance,
 also is available at the Company's Web site,
 www.integritymusic.com/company/indexinv.html.
     Integrity will host a conference call today at 11:30 a.m. Eastern time,
 10:30 a.m. Central time, to discuss first quarter 2001 financial and operating
 results, the outlook for the future and related issues.  To hear the
 discussion, callers should dial 1-800-431-4190 and enter pin number 8882.  The
 call will also be broadcast live on the Internet at www.vcall.com.  A replay
 of the conference call will be available through May 7, 2001, by dialing
 1-800-428-6051 and entering access number 182055.  The call will also be
 archived through May 7, 2001 at www.vcall.com.
 
     Some of the statements contained in this press release, particularly those
 anticipating future financial performance, business prospects, growth and
 operating strategies, new products and similar matters, are forward-looking
 statements that involve a number of risks and uncertainties.  For those
 statements, the Company claims the protection of the safe harbor for
 forward-looking statements contained in the Private Securities Litigation
 Reform Act of 1995.  In addition to the factors discussed above, among the
 other factors that could cause actual results to differ materially are:
 potentially changing consumer tastes and demands with respect to Christian
 music generally and praise and worship music in particular; the effect on
 operating margins of marketing and distribution costs associated with the WoW
 Worship releases; the effect on profit margins of a continued increase in the
 percentage of sales from retail sales; increases in the estimated cost of
 television advertising, including production costs and the cost of air time,
 all of which could materially affect the financial impact of the Songs 4
 Worship series and other television advertising initiatives; the public's
 interest in the Songs 4 Worship product could decline which could lead to
 revenues from the sale of these products falling significantly short of the
 Company's expectations, and the risks identified from time to time in
 Integrity's SEC reports, including, but not limited to, the report on Form
 10-K for the year ended December 31, 2000.  Any forward-looking statements
 represent our estimates only as of the date of this release and should not be
 relied upon as representing our estimates as of any subsequent date.  While we
 may elect to update forward-looking statements at some point in the future, we
 specifically disclaim any obligation to do so, even if our estimates change.
 
                  For additional information, please contact:
 
            Don Ellington, CFO of Integrity, Inc. at (334) 633-9000
                                       or
  RJ Falkner & Company, Investor Relations Counsel at (800) 377-9893 or via e-
                          mail at info@rjfalkner.com.
 
 
                             INTEGRITY INCORPORATED
                      CONSOLIDATED STATEMENT OF OPERATIONS
                       (in thousands, except share data)
 
                                                        Three Months Ended
                                                             March 31
                                                       2001           2000
 
     Net sales                                        $20,894        $13,897
     Cost of sales                                     12,620          7,349
     Gross profit                                       8,274          6,548
 
     Marketing and fulfillment expenses                 3,503          3,302
     General and administrative expenses                3,155          2,668
      Income from operations                            1,616            578
 
     Other expenses
      Interest expense, net                               156            262
      Other expenses                                       33             16
      Income before minority interest and taxes         1,427            300
     Provision for income taxes                            81            113
     Minority interest, less applicable taxes              37             20
     Net income                                        $1,309           $167
 
 
     Net income per share
      Basic                                             $0.23          $0.03
      Diluted                                           $0.21          $0.03
 
     Weighted average number of shares outstanding
      Basic                                             5,619          5,614
      Diluted                                           6,151          6,023
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X59434987
 
 SOURCE  Integrity Incorporated