ePlus Reports First Quarter Financial Results: Revenues Increase 34% to $107 Million Diluted Earnings Per Share Decreases 4% to $0.23; Net Earnings Decrease 6% to $2.2 Million

Business Wire, August 16, 2004

HERNDON, Va. -- ePlus inc. (Nasdaq NM: PLUS), a leading provider of Enterprise Cost Management (ECM), today announced financial results for its first quarter of fiscal year 2005, which ended June 30, 2004. For the quarter, as compared to the same period the prior fiscal year, total revenues increased 34% to $106.7 million from $79.9 million, net earnings decreased 5.6% to $2.2 million from $2.3 million, and fully diluted earnings per share decreased 4.2% to $0.23 from $0.24.

"This quarter's financial performance included the Manchester Technologies, Inc. acquisition which occurred on May 28, 2004. This transaction was structured as an asset purchase in which we absorbed a full month's worth of expenses in June, but recognized only certain sales due to the timing of transactions which was part of the acquisition agreement" stated Phillip G. Norton chairman, president and CEO of ePlus. "This acquisition gives us a larger presence in the metropolitan New York City area, Baltimore, Maryland and Boca Raton, Florida. We have experienced a significant increase in revenues during this quarter, which reflects purchasing levels we haven't seen for several years."

The increase in total revenues for the quarter was driven by a 40.9% increase in Sales of Equipment. ePlus' cash was reduced to $8.8 million at the quarter ended June 30, 2004, from $25.2 million at fiscal year-end March 31, 2004. The reduction was due, in part, to cash utilization for working capital requirements, an increase in investment grade lease receivables in lieu of non-recourse debt financing to increase net lease portfolio return, and the cash consideration paid in the acquisition of Manchester Technologies, Inc. Accounts receivable increased from $51.2 million on March 31, 2004 to $70.5 million on June 30, 2004 as a result of our higher sales levels. On April 2, 2004, ePlus announced the increase of its floor-planning and A/R financing agreement with GE Capital Distribution finance from a total facility limit of $33 million to $50 million. Total Assets and Shareholders Equity on June 30, 2004 were $299.7 million and $113.4 million, respectively, as compared to $294.2 million and $111.6 million on March 31, 2004.

Highlights

--ePlus acquired the IT fulfillment, professional services, and software development and consulting service businesses of Manchester Technologies, Inc. (NASD NM: MANC). The acquisition expands ePlus' customer base and geographic reach with the addition of established regional offices in metropolitan New York, South Florida, and the Baltimore area. The acquisition also expands ePlus' professional services team and will provide additional opportunities to sell ePlus' Enterprise Cost Management solutions to the newly acquired customer base.

--ePlus received several industry recognition awards, including being named as one of Supply & Demand Chain Executive Magazine's Top 100 companies in 2004 for Enabling Supply Chain Transformation. In the VARBusiness 500, ePlus Ranks #130 of Nation's Top 500 Resellers and also earned a place in the VARBusiness Fast 50.

--Georgia-Pacific, one of the world's largest manufacturers of paper and building products, deployed Procure to improve its electronic purchasing of technology-related equipment in more than 350 locations across the United States. The ePlus system strengthens Georgia-Pacific's cost control by improving employees' ability to research products and pricing from preferred suppliers and by giving managers advanced insight into spending patterns.

The financial results presented herein are unaudited. Investors are encouraged to review the company's Form 10-Q which will be filed on or around August 16, 2004 and to review other SEC filings including the company's audited financial statements contained in Form 10-K.

Conference Call Scheduled for August 18th at 9:30 A.M.

The Company will host a conference call at 9:30 a.m. on August 18, 2004. To listen, please call (973) 935-2107 or toll-free (800) 370-0923. Ask to be connected to the ePlus conference call. Live and archived webcasts can be accessed from www.eplus.com/investor. A telephone replay of the conference call will be available by calling (877) 519-4471 or (973) 341-3080, and entering the passcode 5071050 beginning at about 2:00 P.M. on August 18, 2004.

About ePlus inc.

A leading provider of Enterprise Cost Management, ePlus provides a comprehensive solution to reduce the costs of purchasing, owning, and financing goods and services. ePlus Enterprise Cost Management (eECM) packages business process outsourcing, eProcurement, asset management, product and catalog content management, supplier enablement, strategic sourcing, financial services and document access and collaboration into a single integrated solution, all based on ePlus' leading business application software. The company is headquartered in Herndon, VA, and has more than 30 locations in the U.S and Canada. For more information, visit www.eplus.com, call 888-482-1122 or email info@eplus.com.