Press Releases

DAG Media, Inc. Reports First Quarter Financial Results

Date: May 12, 2008Â Source: DAG Media, Inc.Â Contact: Assaf Ran, CEOÂ Inbar Evron-Yogev, CFOÂ (718) 520-1000Â

NEW YORK, May 12, 2008 / PRIME Newswire / -- DAG Media Inc. (Nasdaq: DAGM - news)

DAG Media, Inc. announced today that net income for the quarter ended March 31, 2008 was $0.04 per basic and diluted share (based on 3.236 million shares), or $139,741, versus net loss of (0.05) per basic and diluted share (based on 3.236 million shares)or ($156,065) for the period ended March 31, 2007.

Total revenue for the period ended March 31, 2008 were $165,000 versus total revenue of $1,000 for the period ended March 31, 2007. The revenue in the first quarter mainly represents interest income on short term loans of $147,000 and origination fees on these loans of $18,000 made through DAG Funding.

Income from continuing operations for the period ended March 31, 2008 was $67,000 compared to a loss from continuing operations of $185,000 for the period ended March 31, 2007, an increase of $252,000. This increase in income resulted mainly from revenue from short term notes generated through DAG Funding of $165,000, a decrease of $41,000 in general and administrative expense and an increase of $36,000 in other income.

Assaf Ran, Chairman of the Board and CEO stated, “I am pleased with the progress that the company is making toward consistent profitability. As we gain more experience in the non banking commercial lending business we enhance and optimize our profits from each transaction, while simultaneously making progress in establishing a broader customer’s base and increasing deal flow.”

DAG Media, Inc. through our subsidiaries provides short term, secured, non–banking, commercial loans, to small businesses. In addition we developed innovative software and a related web site that allows retail businesses and other service providers to reach prospective customers and clients for their goods and services in a more effective way than traditional on-line and print yellow pages search . We operate several web sites: http://www.dagfundingsolutions.com, http://www.nextyellow.com, andhttp://www.dagmedia.com.

Forward-looking statements in this release are made pursuant to the “safe harbor'' provisions of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements involve risks and uncertainties, including, without limitation, continued acceptance of the Company's products, increased levels of competition, new products introduced by competitors, changes in the rates of subscriber acquisition and retention, and other risks detailed from time to time in the Company's periodic reports filed with the Securities and Exchange Commission.

DAG MEDIA, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(unaudited)

Assets	March 31, 2008	December 31,2007
Current assets:
Cash and cash equivalents	$280,442	$621,724
Marketable securities	734,630	802,811
Auction rate securities	1,175,000	---
Short term investment – insurance annuity contract – at fair value	938,446	931,555
Total cash and cash equivalents, marketable securities and short term investment	3,128,518	2,356,090

Short term commercial notes	3,739,808	4,313,211
Interest receivable on short term commercial notes	40,774	41,184
Due from purchaser	83,186	156,103
Other current assets	37,698	17,083
Total current assets	7,029,984	6,883,671

Long term commercial notes	200,000	---
Property and equipment, net	13,090	14,261
Capitalized web development costs, net	61,679	74,015
Security deposit	17,515	17,515
Investment in privately held company, at cost	100,000	100,000
Total assets	$7,422,268	$7,089,462

Liabilities and Shareholders’ Equityf

Current liabilities:
Accounts payable and accrued expenses	$119,351	$123,886
Deferred gain from the sale of Jewish Directories	---	72,917
Deferred origination fee	---	4,597
Lines of credit	314,488	---
Total current liabilities	433,839	201,400
Commitments and contingencies
Shareholders’ equity:
Preferred shares - $.01 par value; 5,000,000 shares authorized; no shares issued	---	---
Common shares - $.001 par value; 25,000,000 authorized; 3,305,190 issued and 3,236,460 outstanding	3,305	3,305
Additional paid-in capital	9,202,151	9,180,235
Treasury stock, at cost- 68,730 shares	(231,113)	(231,113)
Accumulated other comprehensive loss	(502,562)	(441,272)
Accumulated deficit	(1,483,352)	(1,623,093)
Total shareholders’ equity	6,988,429	6,888,062
Total liabilities and shareholders’ equity	$7,422,268	$7,089,462

DAG MEDIA, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)

Three Months Ended March 31,
	2008	2007
Interest income from short term commercial notes	$147,461	$---
Origination fees	17,825	---
Subscription revenues, net	57	1,362
Total Revenue	165,343	1,362
Operating costs and expenses:
Web development expenses	12,336	12,336
General and administrative expenses	160,422	201,647
Total operating costs and expenses	172,758	213,983

Loss from operations	(7,415)	(212,621)

Interest and dividend income	24,749	54,763
Realized gain (loss) on marketable securities	---	(26,826)
Other income	39,000	---
Total other income	63,749	27,937

Income (loss) from continuing operations before income tax benefit	56,334	(184,684)
Income tax benefit	10,490	---
Income (loss) from continuing operations	66,824	(184,684)

Discontinued Operations:
Gain on the sale of the Jewish Directories (net of tax effect of 0 in 2008 and 2007)	72,917	48,611
Loss from operations of Shopila (net of tax effect of 0)	---	(19,992)
Income from discontinued operations	72,917	28,619
Net Income (loss)	$139,741	$(156,065)

Basic and Diluted net income (loss) per common share outstanding:
Continuing operations	$0.02	$(0.06)
Discontinued operations	$0.02	$0.01
Net income (loss) per common share	$0.04	$(0.05)

Weighted average number of common shares outstanding
--Basic and Diluted	3,236,460	3,236,460

DAG MEDIA, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
Three Months ended March 31,

	2007	2008
Cash flows from operating activities:
Net Income (loss)	$139,741	$(156,065)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Gain on the sale of Jewish Directories	(72,917)	(48,611)
Loss from discontinued operations of Shopila	----	19,992
Depreciation and amortization	13,507	13,458
Non cash compensation expense	21,916	29,688
Realized loss on sale of marketable securities	----	26,826
Changes in operating assets and liabilities net of effects of disposition:
Interest receivable on short term commercial notes	410	----
Other current and non current assets	(20,615)	11,989
Accounts payable and accrued expenses	(4,535)	(73,971)
Deferred origination fees	(4,597)	----
Income tax payable	----	(4,764)
Assets and Liabilities of discontinued operations	----	(82,983)
Net cash provided by (used in) operating activities	72,910	(264,441)

Cash flows from investing activities:
Proceeds from sale of marketable securities	----	248,115
Investment in marketable securities, annuity contract and auction rate securities	(1,175,000)	(236,991)
Short and long term commercial notes made	(956,597)	----
Collection received from short term commercial notes	1,330,000	----
Cash received on sale of Jewish Directories	72,917	90,473
Net cash (used in) provided by investing activities	(728,680)	101,597

Cash flows from financing activities:
Use of lines of credit	314,488	----
Net cash provided by financing activities	314,488	----

Net decrease in cash and cash equivalents	(341,282)	(162,844)
Cash and cash equivalents, beginning of period	621,724	3,630,937
Cash and cash equivalents, end of period	$280,442	$3,468,093

Supplemental Cash Flow Information:
Taxes paid during the period	$5,767	$4,764
Interest Paid during the period	$942	$----