N-Viro International Reports Financial Results for the First Quarter 2010

TOLEDO, Ohio, May 17 /PRNewswire-FirstCall/ -- N-Viro International Corporation (OTC Bulletin Board: NVIC) ("N-Viro"), a leading-edge environmental biotech company that markets an alternative fuel technology and advanced fertilizer products, including the renewable biofuel N-Viro Fuel™ and N-Viro Soil™, announced that on May 17, 2010 it filed its Quarterly Report on Form 10-Q for the three months ended March 31, 2010.

Financial highlights for the quarter include:

• Revenues were $1.37 million, representing a 20% increase over fourth quarter 2009 revenues of $1.15 million and a 2% increase when compared to first quarter 2009 revenues of $1.35 million;
• Gross profit for the reporting period was $374,000, representing an 81% increase over fourth quarter 2009 reported as $207,000 and a 4% decrease when compared to $391,000 in the first quarter 2009;
• Gross profit margins for period were 27%, an improvement of 9% over fourth quarter 2009 and a decrease of 2% for the comparable first quarter 2009;
• Operating expenses reported as $1,521,000, an increase of $750,000 over fourth quarter 2009 and $1,164,000 as compared to the first quarter of 2009;
• Net loss increased to $1,143,000, or $0.22 per share for the quarter compared with a net loss of $544,000, or $0.11 per share for the fourth quarter ended 2009 and a net income of $20,000, or $0.00 per share for the same period one year ago;
• Non-GAAP adjusted cash earnings were $7,000 for the quarter compared with a loss of $59,000 for fourth quarter 2009, but a decrease from first quarter 2009 of $55,000.

Timothy Kasmoch, President and CEO of N-Viro said, "The quarterly improvement over the fourth quarter 2009 reflects our ongoing efforts focusing on operating efficiencies.  The result of this focus is demonstrated by a 9% sequential quarterly improvement in gross profit margins.  Due to unusual inclement weather patterns in our Florida market for the comparable 2010 and 2009 first quarter periods, revenues were flat, though on a sequential basis, I am pleased to report a 20% improvement when compared to fourth quarter 2009.  On an adjusted cash basis - adding back $1,117,000 of non-cash stock and options expense, $139,000 of amortization and depreciation expense and subtracting debt payments, we had $7,000 of cash-based earnings for the first quarter 2010 versus a $1,143,000 loss reported on a GAAP basis."

Operational highlights for the quarter include:

• Wet tons of biosolids processed in the first quarter 2010 increased 11% to 26,300 tons compared with 23,600 tons in the fourth quarter of 2009.  Compared to the first quarter of 2009, tonnage decreased by 1%.
• Ongoing discussions with international opportunities in South America.
• Secured short and long-term customer and supplier extensions in all markets.

Mr. Kasmoch continued: "Biosolids processing has remained consistent despite fluctuations related to economic stress and unusual weather patterns in our Florida market.  We continue to focus our energy and available capital towards the development of our N-Viro Fuel technology and anticipate continued progress in solidifying previously announced initiatives that will provide a supply chain of our fuel product by the end of 2010.  We are increasingly optimistic in our ability to reach this goal and look forward to the potential this technology offers."

About N-Viro International (www.nviro.com)

N-Viro International is an environmental and materials operating company that owns patented technologies to convert various types of waste into beneficial alternative fuel products.  Its renewable biofuel technology, N-Viro Fuel™, has received alternative energy status from the U.S. Environmental Protection Agency, which qualifies the technology for renewable energy incentives.  N-Viro operates processing facilities independently as well as in partnership with municipalities.

N-Viro maintains a web site at www.nviro.com, where interested parties can follow the progress of the Company.  N-Viro will continue to routinely post press releases on the site and encourages stockholders and interested parties to monitor the site on a regular basis.

Special Cautionary Note Regarding Forward-Looking Statements

The Company cautions that words used in this document such as "expects," "hopes", "anticipates," "believes" and "may," as well as similar words and expressions used herein, identify and refer to statements describing events that may or may not occur in the future.  These forward-looking statements and the matters to which they refer are subject to considerable uncertainty that may cause actual results to differ materially from those described herein.  For example, while the Company expects business expansion projects to begin in an estimated time frame, such expectations are subject to adverse economic conditions and other factors outside of the Company's control.  Further, the Company's ability to increase capabilities and expand capacity is subject to the ability of the Company or its partners to access sufficient capital to pay for this expansion, which will further depend on, among other factors, market acceptance.  The Company's ability to achieve profitability of these projects could be negatively impacted if there is a lack of an adequate supply of waste or expenses increase above the Company's expectations - including fuel and transportation costs, labor costs and costs relating to the treatment and processing of the biosolids and creation of the N-Viro Soil or N-Viro Fuel.  In addition, while the Company believes that trends in "greener" energy solutions are moving in favor of the Company's technology, such trends may not continue or may never result in increased sales or profits to the Company because of the availability of competing products and other alternative energy source.  All of these factors, and other factors, will affect the profitability of the Company.  Additional information about these and other factors that may adversely affect these forward-looking statements are contained in the Company's reports, including its Annual Report on Form 10-K for the year ended December 31, 2009 and other filings with the Securities and Exchange Commission.  The Company assumes no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information except to the extent required by applicable securities laws.

SOURCE N-Viro International Corporation