Paragon Technologies Reports 2011 Year-End Results

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Cautionary Statement. Certain statements contained herein are not based on historical fact and are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 and the Securities and Exchange Commission rules, regulations and releases. Paragon intends that such forward-looking statements be subject to the safe harbors created hereby. Among other things, the forward-looking statements regard Paragon’s earnings, liquidity, financial condition, review of strategic alternatives, and other matters. Words or phrases denoting the anticipated results of future events, such as “anticipate,” “does not anticipate,” “should help to,” “believe,” “estimate,” “is positioned,” “expects,” “may,” “will,” “is expected,” “should,” “continue,” and similar expressions that denote uncertainty, are intended to identify such forward-looking statements. Paragon’s actual results, performance, or achievements could differ materially from the results expressed in, or implied by, such “forward-looking statements”: (1) as a result of factors over which Paragon has no control, including the strength of domestic and foreign economies, sales growth, competition, and certain cost increases; and (2) if the factors on which Paragon’s conclusions are based do not conform to its expectations. The forward-looking statements contained in this press release may become outdated over time. Paragon does not assume any responsibility for updating any forward-looking statements. Furthermore, achievement of the objectives of the Company is subject to certain risks, including, but not limited to, those risks outlined in Paragon’s filings with the OTC Markets Group, including its annual report for the fiscal year ended December 31, 2010, and the most recent quarterly report for the period ended September 30, 2011 as filed with the OTC Markets Group.

This press release and prior releases are available at www.ptgamex.com.

Paragon Technologies, Inc.

Summary Financial Information

Selected Financial Data — Balance Sheets

(In Thousands, Except Ratio Information)

December 31, 2011

December 31, 2010

Cash and cash equivalents

$  4,871

4,892

Trade receivables

$  838

1,744

Inventories

$  577

492

Current assets

$  6,639

7,443

Current liabilities

1,677

2,704

     Working capital

$  4,962

4,739

Current ratio

3.96

2.75

Total assets

$  6,751

7,587

Total stockholders' equity

$  5,074

4,883

Paragon Technologies, Inc.

Summary Financial Information

Selected Financial Data — Statements of Operations

(In Thousands, Except Per Share Information)

Year Ended

December 31,

2011

2010

Net sales                    

$  8,524

8,036

Income (loss) before income taxes

$  161

(1,205)

Income tax benefit

(30)

(151)

Net income (loss)

$  191

(1,054)

Basic earnings (loss) per share

$  .12

(.68)

Diluted earnings (loss) per share

$  .12

(.68)

Paragon Technologies, Inc.

Supplemental Financial Information

Reconciliation of Net Income (Loss) to EBITDA

(In Thousands)

Year Ended

December 31,

2011

2010

Net income (loss)

$  191

(1,054)

Add:   Income tax benefit

(30)

(151)

Income (loss) before income taxes

161

(1,205)

Add:   Interest expense

1

1

Add:   Depreciation and amortization expense

55

76

EBITDA

$  217

(1,128)