MKTG INC Reports $1.1 million in Operating Income for Its Second Quarter Ended September 30, 2011

NEW YORK, Nov. 4, 2011 /PRNewswire/ -- MKTG INC (OTC BB: CMKG), a full service marketing agency, today announced its operating results for its second quarter ended September 30, 2011.

Operating Results - Second Quarter, Fiscal 2012

For its second quarter ended September 30, 2011, Operating Revenue was $9.1 million, compared to $9.2 million for the quarter ended September 30, 2010. Compensation and general and administrative expenses were $8.1 million for the quarter, compared to $8.0 million for the quarter ended September 30, 2010.  Operating income for the quarter was $1,092,000, compared to $1,215,000 for the second quarter of the previous year.  Modified EBITDA for the quarter was $1,443,000, compared to $1,707,000 for the quarter ended September 30, 2010.

Operating Results – Six Months Ended September 30, 2011

For the six months ended September 30, 2011, Operating Revenue increased $1.2 million or 7% to $18.5 million, compared to $17.3 million for the six months ended September 30, 2010. Compensation and general and administrative expenses were $16.3 million for the six-month period, compared to $15.4 million for the six months ended September 30, 2010.  Operating income for the period increased to $2.2 million, compared to $1.9 million for the six months ended September 30, 2010.  Modified EBITDA for the period was $2.9 million, compared to $2.8 million for the six months ended September 30, 2010.

"We are very pleased with our second quarter and six month results and the building momentum as we enter into the second half of our fiscal year," said Charlie Horsey, President and Chief Executive Officer.  Mr. Horsey concluded, "This fiscal year we have made expenditures in new business development, strategic, creative and digital resources, which we believe will deliver enhanced results over the balance of the year and in the future."

"This is the second consecutive quarter the Company has reported operating income in excess of $1 million which was a major factor in working capital increasing $2.8 million during the six months ended September 30, 2011," said Paul Trager, Chief Financial Officer.  Mr. Trager continued, "We expect that the Company's balance sheet will continue to strengthen due to our anticipated ongoing profitability."

Operating Revenue and Modified EBITDA

The Company believes Operating Revenue and Modified EBITDA are key performance indicators. The Company defines Operating Revenue as sales less reimbursable program costs and expenses and outside production and other program expenses. Operating Revenue is the net amount derived from sales to customers that management believes is available to fund compensation, general and administrative expenses and capital expenditures. The Company defines Modified EBITDA as income before interest, income taxes, depreciation and amortization plus other non-cash expenses. The Company uses Modified EBITDA as a supplemental measure to evaluate operational performance. Operating Revenue and Modified EBITDA are Non-GAAP financial measures disclosed by management to provide additional information to investors in order to provide them with alternative methods for assessing the Company's financial condition and operating results. These measures are not in accordance with, or a substitute for, GAAP and may be different from or inconsistent with Non-GAAP financial measures used by other companies. Reconciliations of Operating Revenue to sales and Modified EBITDA to operating income are provided at the end of this press release.

About MKTG INC

MKTG INC is a full service marketing agency headquartered in New York with full service offices in San Francisco, Los Angeles, Chicago and Cincinnati. The Company currently serves a variety of the world's most recognizable brands. Its services include experiential marketing, digital marketing, retail promotions and strategic research and planning. The firm's programs help its clients profitably connect with consumers and create networks of brand advocates to generate brand awareness and higher sales for its customers. For more information, please visit www.mktg.com.

This press release includes statements which constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Forward-looking statements in this press release are not promises or guarantees and are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. These statements are based on management's current expectations and assumptions and are naturally subject to uncertainty and changes in circumstances. We caution you not to place undue reliance upon any such forward-looking statements. Actual results may vary materially from those expressed or implied by the statements herein. Factors that could cause actual results to differ materially from the Company's expectations are set forth in the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2011 under "Risk Factors," and include the risk that projected business opportunities will fail to materialize or will be delayed. The Form 10-K may be obtained by visiting the Company's website or by accessing the database maintained by the Securities and Exchange Commission at http://www.sec.gov.

SOURCE MKTG INC