ENHT Enherent Corp (CE)

enherent Corp. (OTC BB: ENHT, www.enherentcorp.com), an information technology services company, today announced its results for the first quarter of 2009.

First Quarter 2009 Financial Results

Revenues for the first quarter ended March�31, 2009 were $3.6 million, compared to revenues of $7.0 million in the quarter ended March�31, 2008. Net income decreased by approximately $189,000 to a loss of $116,000, or $(0.01) per diluted share, for the first quarter of 2009 as compared to net income of approximately $73,000, or $0.00 per diluted share, for the comparable quarter of 2008. Earnings before interest, taxes, depreciation and amortization, or EBITDA, totaled $81,000 for the first quarter of 2009 as compared to $295,000 for the comparable quarter of 2008. EBITDA, adjusted to add back stock-based compensation, or Adjusted EBITDA, totaled $102,000 for the first quarter of 2009 as compared to $316,000 for the comparable quarter of 2008.

Pamela Fredette, Chairman, CEO and President, commenting on the financial results for the first quarter 2009, said "Since the end of last year, we have felt the negative impact of the global economic slowdown which has put pressure on our revenues and profitability. We were able to manage the business to continue to achieve positive EBITDA. We continue to focus our efforts on our Text Analytics practice which we believe will be in demand longer term, and at the same time, continue to take steps to contain and reduce expenses.�

Forward-Looking and Cautionary Statements

Except for the historical information and discussions contained herein, statements contained in this release may constitute �forward- looking statements� within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on certain assumptions and analyses made by the Company derived from its experience and perceptions. Actual results and developments may vary materially from those described because they are subject to a number of known and unknown risks and uncertainties. Such risks and uncertainties include, but are not limited to, future demand for the Company�s services; general economic, market and business conditions; the Company�s ability to increase the amount of services rendered to existing clients and develop new clients and reduce costs of providing services; the Company�s ability to recruit and retain IT professionals; and various other factors discussed in the Company�s filings with the Securities and Exchange Commission including those set forth under Item�1A of�the Company�s�most recent Form 10-K. The Company disclaims any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments, or otherwise.

NON-GAAP Financial Measures:

enherent Corp. utilizes a number of different financial measures, both GAAP and non-GAAP, in analyzing and assessing the overall business performance, for making operating decisions and for forecasting and planning future periods. The Company considers the use of non-GAAP financial measures helpful in assessing its current financial performance and prospects for the future. While the Company uses non-GAAP financial measures as a tool to enhance its understanding of certain aspects of its financial performance, the Company does not consider these measures to be a substitute for, or superior to, the information provided by GAAP financial measures. Consistent with this approach, the Company believes that disclosing non-GAAP financial measures to the readers of its financial statements provides such readers with useful supplemental data that, while not a substitute for GAAP financial measures, allows for greater transparency in the review of its financial and operational performance. In assessing the overall health of its business during the first quarter 2009 and 2008, the Company excluded items in the following general categories, each of which are described below:

Stock-based Compensation The Company believes that because of the variety of equity awards used by companies, varying methodologies for determining stock-based compensation and the assumptions and estimates involved in those determinations, the exclusion of non-cash stock-based compensation enhances the ability of management and investors to understand the impact of non-cash stock-based compensation on our operating results. Further, the Company believes that excluding stock-based compensation expense allows for a more transparent comparison of its financial results to previous periods. In addition, the Company prepares and maintains its budgets and forecasts for future periods on a basis consistent with this non-GAAP financial measure.

Earnings Before Interest, Taxes, Depreciation and Amortization. The press release contains references to EBITDA and�Adjusted EBITDA and provides reconciliations of EBITDA and Adjusted EBITDA�to Net income (loss) on the face of the�attached statements of operations. The Company�s management believes that EBITDA is used by investors and analysts as an alternative to GAAP measures when evaluating the Company�s performance in comparison to other companies. In order to fully assess the Company�s financial operating results, management believes that EBITDA is an appropriate measure of evaluating the Company�s operating performance, because it eliminates the effects of financing and accounting decisions. This measure is also significant to institutional lenders, and is considered an important internal benchmark of performance by the Company. The Company�s management uses EBITDA to measure the Company�s performance against internal performance targets, which are based on EBITDA. In addition, the Company further excludes�stock-based compensation in calculating�Adjusted EBITDA.�The Company believes�excluding stock-based compensation allows for a better assessment of its�normalized�internal operations and comparisons to industry performance.

Each of the non-GAAP financial measures described above, and used in this press release, should not be considered in isolation from, or as a substitute for, a measure of financial performance prepared in accordance with GAAP. Further, investors are cautioned that there are inherent limitations associated with the use of each of these non-GAAP financial measures as an analytical tool. In particular, these non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles and many of the adjustments to the GAAP financial measure reflect the exclusion of items that are recurring and will be reflected in the Company�s financial results for the foreseeable future. The Company compensates for these limitations by providing specific information in the reconciliation included in this press release regarding the GAAP amounts excluded from the non-GAAP financial measures. In addition, as noted above, the Company evaluates the non-GAAP financial measures together with the most directly comparable GAAP financial information.

(1) GAAP stands for Generally Accepted Accounting Principles.

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ENHERENT CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

�

� � March 31,

�

2009

December 31,

(Unaudited)

2008

ASSETS

Current assets: Cash and cash equivalents $ 624,553 $ 1,100,224 Accounts receivable, net 1,981,420 3,098,862 Prepaid expenses and other current assets � 286,919 � 139,563 � Total current assets 2,892,892 4,338,649 Furniture, equipment and improvements, net 147,256 163,926 Goodwill 3,619,278 3,619,278 Other intangibles, net 100,000 125,000 Deferred financing costs, net 114,897 146,678 Other assets � 40,370 � 40,370 � TOTAL $ 6,914,693 $ 8,433,901 � �

LIABILITIES

Current liabilities: Revolving credit facility $ 1,691,353 $ 2,006,070 Current portion of long-term debt 1,115,656 1,013,317 Accounts payable and accrued expenses 2,533,666 3,259,926 Deferred revenue 236,498 169,715 Accrued compensation and benefits � 339,829 � 570,113 � Total current liabilities 5,917,002 7,019,141 Long-term liabilities: Long-term debt, net of current portion above � 1,635,639 � 1,957,605 � Total liabilities � 7,552,641 � 8,976,746 � �

STOCKHOLDERS� (DEFICIENCY)

Preferred stock, $.001 par value; authorized�10,000,000 shares, issued�none

�

�

� Common stock, $.001 par value, authorized�101,000,000 shares, issued and outstanding � 52,375,653 as of March 31, 2009 and December 31, 2008 52,376 52,376 Additional paid-in capital 27,768,974 27,747,974 Accumulated deficit � (28,459,298 ) � (28,343,195 ) � Total stockholders� (deficiency) � (637,948 ) � (542,845 ) � TOTAL $ 6,914,693 $ 8,433,901 � � �

ENHERENT CORP. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

� Three Months Ended March 31, 2009 � � 2008 Revenues: Service revenue $ 3,258,102 $ 6,442,132 Equipment and software revenue � 302,526 � 603,047 � � Total revenue � 3,560,628 � 7,045,179 � � Cost of revenues: Cost of services 2,406,167 4,997,769 Cost of equipment and software � 241,227 � 529,755 � � Cost of revenues � 2,647,394 � 5,527,524 � � Gross profit � 913,234 � 1,517,655 � � Operating expenses: Selling, general and administrative 831,883 1,222,437 Depreciation and amortization expense � 87,800 � 85,612 � � Total operating expenses � 919,683 � 1,308,049 � � Operating (Loss) Income (6,449 ) 209,606 Interest expense � (106,654 ) � (132,880 ) � (Loss) Income before income taxes (113,103 ) 76,726 Income tax provision � (3,000 ) � (3,861 ) � NET (LOSS) INCOME $ (116,103 )

$

72,865 � � Basic net (loss) income per share $ (0.01 )

$

0.00 � � Number of shares used in computing basic net income per share � 52,375,653 � 52,375,653 �

�

Diluted net (loss) income per share $ (0.01 ) $ 0.00 � � Number of shares used in computing diluted net income per share � 52,375,653 � 53,005,111 � � � �

ENHERENT CORP. AND SUBSIDIARIES

RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDA

FOR THE THREE MONTHS ENDED MARCH 31, 2009 AND 2008

(Unaudited)

� � Three Months Ended March 31, � March 31, 2009 2008 Net (loss) income, as reported $ (116,103 ) $ 72,865 Interest (income) expense, net 106,654 132,880 Taxes 3,000 3,861 Depreciation and amortization 87,800 85,612 EBITDA 81,351 295,218 Adjustments: Stock based compensation 21,000 21,000 Adjusted EBITDA $ 102,351 $ 316,218