Nstein announces its results for the first quarter of 2006

2006-05-23

Montreal, Quebec, May 23, 2006 - Nstein Technologies Inc., ("Nstein") (TSX-V: EIN), today announced its results for the first quarter ended March 31, 2006.

Revenues for the first quarter of 2006 totaled $2.1 million, representing a 15% decrease in comparison to the $2.4 million for the same period last year. However, the first quarter revenues show a progression of 39% when compared to the last calendar quarter of 2005, as they stood for this period at $1.5 million. For the first quarter of 2006, Nstein posted a loss before financial expenses, exchange loss, income taxes on earnings, depreciation and amortization (EBITDA) of $807,538 compared to $373,399 the year before. The loss totaled $1,472,878 or $0.008 per share in the first quarter of 2006 as opposed to $832,016 or $0.004 last year. This increased loss results mainly from lower sales and margins combined to additional interest charges related to the convertible debentures issued in October 2005.

Nstein's Chairman and Chief Executive Officer, Mario Girard, stressed the growing importance of the market in which Nstein is evolving. "Since the last few months, we see an increasing number of announcements from key players in the enterprise search and business intelligence industry."

Within this context, in the first quarter of 2006, Nstein pursued its strategic business development with IBM* and the technological integration of its solutions with IBM's Content Management & Discovery platform, WebSphere* Information Integrator, OmniFind* Edition. The Company has also announced an important equity financing agreement of CAN$10 million in conjunction with Solidarity Fund QFL and a Canadian venture capital firm, J.L. Albright IV Venture Fund. This financing, which should close sometime in the next few weeks, will enable the Company not only to accelerate its sales and marketing efforts, but also to achieve a promising project, i.e., a new platform that will make it possible to offer Nstein's powerful technology via an Internet subscription model (ASP model).

Nstein's solution, whose initial focus is the financial services market, will provide analysts with an early warning analysis system they can use to monitor and analyze comments (made in financial forums, reports and analyses, blogs and newswires) about the companies that make up their investment portfolios. This type of software used in a 'service' mode, coupled with Nstein's actual licensing offer, will provide the Company with a flexible product offering that is unique in the market.

Nstein is also proud to announce the signing in the first quarter of a contract with Siemens Business Services to deploy its solutions at the British Broadcasting Corporation (BBC), one of the world's premier broadcasting organizations. As part of this contract, Nstein's solutions have been procured to assist the BBC in managing indexing processes within its national television and radio archives and applying indexing to impressive volumes of content from various multimedia outputs.

Outlook

"Major public search engines have made great progress with technologies that make it possible to conduct searches across huge sources of information on the Internet, but still haven't the capacity to mine this information for discovering meaning and relationships," also declared Mario Girard. "On the other hand, enterprise search technologies have a narrower focus, but their 'in-depth' understanding of information is crucial. The development of specific solutions to meet the needs of organizations is, therefore, vital."

"Last, although the added value of our solutions is undeniable and their benefits obvious, it's never easy to radically and quickly transform organizations" business processes. It's clear, however, that applications with the capability to understand content and context will be at the heart of corporate strategies in the coming years, and Nstein intends to take full advantage of this trend," concluded Mr. Girard.

Annual and Special Shareholders' Meeting

At its Annual and Special Shareholders' Meeting held today, May 23, 2006, Nstein announced the election of the following persons as directors of the Company until the next Annual Meeting of Shareholders to be held in Spring 2007: Ms. Nancy Goudreau and Messrs. Jean Bédard, Rainer Busch, Richard Drouin, Marc Dutil, Michel Lavigne, Mario Girard and Laurent Proulx.

About Nstein Technologies Inc.

Nstein Technologies (TSX-V: EIN) develops and markets leading-edge software solutions for analyzing vast amounts of unstructured data in virtually all languages. Nstein's linguistic-based platform collects, organizes, analyzes, cross-examines, shares and translates data from any source, in real time. Nstein's text mining and multilingual information access solutions transform reactive decision-making into a high-impact proactive and even predictive process, and solve mission-critical problems. Nstein has developed tailored solutions for clients in e-publishing and homeland security & intelligence markets, as well as for large enterprises and government organizations. The Company is headquartered in Montreal, Canada, with offices in the United States and Europe. More information is available at www.nstein.com.

• The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.
• Any statement that appears prospective shall not be interpreted as such.

###