ITEX Announces Results for Third Quarter of Fiscal Year 2011

ITEX CORPORATION

CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

April 30, 2011

July 31, 2010

ASSETS

Current assets:

    Cash and cash equivalents

$                  4,765

$                5,169

    Accounts receivable, net of allowance of $389 and $349

1,139

859

    Prepaid expenses

171

118

    Loans and advances

37

55

    Prepaid advertising credits

82

157

    Deferred tax asset

1,018

1,018

    Notes receivable - corporate office sales

150

125

    Other current assets

67

24

Total current assets

7,429

7,525

Property and equipment, net of accumulated depreciation of $451 and $380

105

169

Intangible assets, net of accumulated amortization of $2,579 and $2,205

691

994

Deferred tax asset, net of current portion

4,650

5,000

Notes receivable - corporate office sales, net of current portion

607

480

Other long-term assets

46

188

Goodwill

3,282

3,282

              Total assets

$                16,810

$              17,638

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable

$                     101

$                   124

Commissions payable to brokers

-

661

Accrued commissions to brokers

1,196

789

Accrued expenses

622

705

Deferred revenue

41

133

Advance payments

119

167

Total current liabilities

2,079

2,579

Long-term liabilities:

      Other long-term liabilities

7

190

Total Liabilities

2,086

2,769

Commitments and contingencies

Stockholders’ equity:

Common stock, $0.01 par value; 9,000 shares authorized;
3,645 and 3,576 shares issued and outstanding, respectively

36

36

Additional paid-in capital

29,383

29,138

Stockholder note receivable

(605)

-

Accumulated deficit

(14,090)

(14,305)

Total stockholders' equity

14,724

14,869

               Total liabilities and stockholders’ equity

$                16,810

$              17,638

ITEX CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

(In thousands, except per share amounts)

Three-Months Ended April 30,

Nine-Months Ended April 30,

2011

2010

2011

2010

Revenue:

Marketplace revenue and other revenue

$          3,960

$        4,158

$   12,490

$   12,618

Costs and expenses:

Cost of Marketplace revenue

2,336

2,618

7,578

8,074

Corporate salaries, wages and employee benefits

487

489

1,504

1,380

Selling, general and administrative

602

471

2,036

1,386

Depreciation and amortization

147

159

456

492

3,572

3,737

11,574

11,332

Income from operations

388

421

916

1,286

Other income (expense)

Net interest

13

10

33

31

Gain (Loss) on sale of assets

-

-

33

(157)

13

10

66

(126)

Income before income taxes

401

431

982

1,160

Provision for income taxes

162

162

389

442

Net income

$             239

$           269

$        593

$        718

Net income per common share:

Basic

$            0.07

$          0.08

$       0.17

$       0.20

Diluted

$            0.07

$          0.08

$       0.16

$       0.20

Weighted average shares outstanding

Basic

3,611

3,575

3,590

3,571

Diluted

3,634

3,581

3,630

3,575