Nstein Reports First Quarter Results

2003-05-06

Montreal, May 6, 2003 - Nstein Technologies Inc., "Nstein" (TSX-V: EIN) reports a first quarter loss of $858,195, or $0.008 per share, an amount 35% less than that recorded for the first quarter of 2002, which was $1,325,465, or $0.015 per share.

Nstein earned $307,106 in revenue for the first quarter of 2003, compared to revenues of $373,533 recorded for the same quarter last year. This amount includes part of a $0.5 million contract that Nstein signed with a large U.S.-based global e-publisher for the sale of its NserverTM software suite and services. Other revenues were generated principally from maintenance and support services provided to Nstein's current customers.

"Our emphasis for the quarter has been to remain on track in our business strategy with the e-publishing market, while at the same time expand our market exposure in the government and enterprise sectors. We have been diversifying our international sales channels through new distribution partners and licensing agreements, and are confident in finalizing sales with new customers," comments Mario Girard, Nstein's Chairman and Chief Executive Officer.

During the quarter Nstein signed a partnership agreement opening an immediate sales channel for its technology in the growing European publishing market with IXIASOFT, a leader in XML content server solutions. The company also signed a contract with Industry Canada and is in the final stages of contract negotiations with several target pipeline customers, leading system integrators and Integrated Document Management solution providers.

Operating Expenses

Operating, sales and administrative expenses for the first quarter totalled $762,250, an amount 32% less than that reported for the first quarter of 2002, when they were $1,126,277. In addition, research and development costs were $424,246, which is less than what they were during the same period last year, $584,940. These cost reductions result from a program initiated during the last quarter in 2002.

Financial Situation and Cash Flow

As of March 31, 2003, short-term assets totalled $3.5 million, as compared with $4.6 million as at December 31, 2002.
Also at the end of the quarter, short-term liabilities were $1.6 million, compared to $1.8 million at the end of 2002. Cash and cash equivalents reached $2 million as at March 31, 2003, as compared with $3.3 million at December 31, 2002. Nstein's long-term debt was $96,359, a reduction from its total of $129,963 as reported at December 31, 2002.



About Nstein Technologies

Nstein Technologies Inc. is an industry leader in providing innovative content management software solutions to the e-publishing, enterprise and government sectors. Nstein's products automate complex tasks such as document indexing and summarizing, and enable organizations to maximize the value of their content assets through improved organization, navigation, and faster information retrieval. Nstein's Nserver™ solution is a core content management component, which has enabled Nstein's customers to significantly increase their ROI through gains in productivity, efficiency and revenue. Nstein's headquarters are in Montreal, Canada, with operations in San Francisco, Washington, D.C., and London, U.K. For further information please visit www.nstein.com.

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• Any statement that appears prospective shall not be interpreted as such.

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