ICOP ANNOUNCES 2006 SECOND QUARTER RESULTS
For more information, contact: For Investor Relations: Laura E. Owen, COO Elite Financial Communications Group, LLC 16801 West 116th Street Dodi Handy, President and CEO Lenexa, KS 66219 USA Phone: (407) 585-1080 Phone: (913) 338-5550 ICOP@efcg.net Fax: (913) 312-0264 Lowen@ICOP.com www.ICOP.com ICOP ANNOUNCES 2006 SECOND QUARTER RESULTS Achieves 317% and 562% Revenue Growth for Three and Six Months, Respectively LENEXA, KS - (PR NEWSWIRE) - August 9, 2006 - ICOP Digital, Inc. , a leading provider of digital in-car video systems for law enforcement, today announced its financial results for the three and six months ended June 30, 2006. Financial highlights for the three months ended June 30, 2006 compared to the three months ended June 30, 2005: * Revenues rose 317% to $1,366,084 from $327,394. * Gross profit margins improved to 41% from 27%. * Net losses increased to $1,007,650, or $0.18 loss per basic and diluted share, from $700,456, or $0.42 loss per basic and diluted share. Financial highlights for the six months ended June 30, 2006 compared to the six months ended June 30, 2005: * Revenues increased 562% to $2,167,759, up from $327,394. * Gross profit margins climbed to 41.7% from 27%. * Net losses were $1,809,184, or $0.32 loss per basic and diluted share, rising from $1,180,912, or $0.71 loss per basic and diluted share. As of June 30, 2006, cash and accounts receivable totaled approximately $2.4 million; working capital was approximately $7.2 million and total shareholders' equity was approximately $7.9 million. "The second quarter results confirm that ICOP's sales and marketing programs are achieving a strong and favorable response from the law enforcement marketplace, and we are gaining notable momentum," stated Dave Owen, Chief Executive Officer of ICOP. "With fleet deployments of the ICOP Model 20/20 underway at police agencies in 43 states, and literally hundreds of agencies nationwide contemplating purchase, we believe we are well positioned to deliver an outstanding year, defined by rapid revenue growth and steady forward progression towards profitability." "During the second half of the year, we are focused on perpetuating our sales growth within the law enforcement industry, while implementing aggressive growth strategies to win market share of the military and homeland defense markets. The ICOP Model 20/20 is well suited to provide feature-rich and enhanced mobile surveillance functionality to our security forces, with applications in the United States and in military markets around the world. This not only represents a sizable growth opportunity for ICOP, but perhaps more importantly, it represents an opportunity for ICOP to play a vital role in helping to protect lives and critical assets," concluded Owen. ICOP Digital will host a teleconference this morning, beginning at 10:15 AM Eastern, and invites all interested parties to join management in a discussion regarding the Company's financial results, corporate progression and other meaningful developments. The conference call can be accessed via telephone by dialing toll free 1-800-257-1927 or via the web at www.ICOP.com <http://www.icop.com/> . For those unable to participate at that time, a replay of the web cast will be available for 90 days on www.ICOP.com <http://www.icop.com/> . About ICOP Digital, Inc. ICOP Digital, Inc. is a Kansas-based company that delivers innovative, mission-critical security, surveillance, and communications solutions that provide timely and accurate information for the public and private sectors, and monitor and protect people, assets and profits. The ICOP Model 20/20 is the leading digital in-car video recorder system for use by law enforcement. ICOP Digital is currently marketing its solutions for application in law enforcement, homeland security and defense, mass transit and commercial surveillance. ICOP Digital, a GSA contractor, is dual listed on the NASDAQ market and the NYSE Arca, and the common stock and warrants trade under the ticker symbols "ICOP" and "ICOPW," respectively. For more information, please visit www.ICOP.com <http://www.icop.com/> , or to view a three-minute ICOP marketing presentation, please go to http://www.icopdigital.com/why_icop.html. ICOP DIGITAL, INC. Balance Sheet (Unaudited) June 30, 2006 Assets Current Assets Cash $ 1,530,411 Accounts receivable, net 888,529 Finished goods inventory, at cost 5,204,595 Prepaid expenses 85,044 Total current assets 7,708,579 Property and equipment, at cost, net of accumulated depreciation of $236,684 757,380 Other assets: Deferred patent costs 61,480 Deposits 15,000 $ 8,542,439 Liabilities and Shareholders' Equity Current Liabilities: Accounts payable $ 140,192 Accrued liabilities 269,681 Unearned revenue 109,880 Current maturities of long-term debt 41,087 Total current liabilities 560,840 Long-term debt, net of current maturities 100,814 Total liabilities 661,654 Shareholders' equity: Preferred stock, no par value; 5,000,000 shares authorized, no shares issued and outstanding - Common stock, no par value; 50,000,000 shares authorized, 5,900,980 shares issued and outstanding 19,860,937 Accumulated other comprehensive income, net of tax - Deficit accumulated (11,980,152 ) Total shareholders' equity 7,880,785 $ 8,542,439 ICOP DIGITAL, INC. Statement of Operations (Unaudited) Three Months Six Months Ended Ended June 30, June 30, 2006 2005 2006 2005 Sales, net of returns $ 1,366,084 $ 327,394 $ 2,167,759 $ 327,394 Cost of sales 805,385 238,903 1,263,251 238,903 Gross profit 560,699 88,491 904,508 88,491 Operating expenses: Selling, general and administrative 1,281,349 532,517 2,204,516 866,566 Research and development 315,043 144,502 564,930 261,728 Total operating expenses 1,596,392 677,019 2,796,446 1,128,294 Loss from operations (1,035,693 ) (588,528 ) (1,864,938 ) (1,039,803 ) Other income (expenses): Foreign currency translation 19,215 (56,306 ) 27,159 (56,306 ) Interest income 17,169 - 43,150 - Interest expense (8,341 ) (55,622 ) (14,555 ) (84,803 ) Loss before income taxes (1,007,650 ) (700,456 ) (1,809,184 ) (1,180,912 ) Income tax provision - - - - Net loss $ (1,007,650 ) $ (700,456 ) $ (1,809,184 ) $ (1,180,912 ) Basic and diluted loss per share $ (0.18 ) $ (0.42 ) $ (0.32 ) $ (0.71 ) Basic and diluted weighted average common shares outstanding 5,754,313 1,668,862 5,619,264 1,667,444 Safe Harbor Statement This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are subject to risks and uncertainties that could cause actual results to vary materially from those projected in the forward-looking statements. The company may experience significant fluctuations in future operating results due to a number of economic, competitive, and other factors, including, among other things, our reliance on third-party manufacturers and suppliers, government agency budgetary and political constraints, new or increased competition, changes in market demand, and the performance or reliability of our products. These factors and others could cause operating results to vary significantly from those in prior periods, and those projected in forward-looking statements. Additional information with respect to these and other factors, which could materially affect the company and its operations, are included in certain forms the company has filed with the Securities and Exchange Commission.