ePlus Reports December 31, 2007 Quarter Results: Revenues Decreased 11.0% to $198.4 Million; Net Earnings Decreased 69.8% to $3.8 Million

ePlus inc. (PINKSHEETS: PLUS) today announced financial results for its third quarter of fiscal year 2008, which ended December 31, 2007 ("the Quarter"). Revenues for the Quarter decreased 11.0% to $198.4 million as compared to revenues of $222.9 million during the three months ended December 31, 2006 ("the Prior Year's Quarter"). Net earnings for the Quarter decreased 69.8% to $3.8 million from $12.4 million the Prior Year's Quarter. As disclosed in the Company's Form 10-Q for the period ended December 31, 2006, the Prior Year's Quarter included patent settlement income of $17.5 million and related expenses of $5.8 million. Excluding the patent settlement income, total revenues decreased 3.4% in the Quarter as compared to the Prior Year's Quarter.

With the filing on May 2, 2008 of the Company's Form 10-Q for the quarter ended December 31, 2007, the Company believes it is now current in its quarterly and annual report filing requirements of the Securities Exchange Act of 1934 and the related SEC rules.

Both basic and fully diluted earnings per common share were $0.45 for the Quarter, as compared to $1.51 and $1.47, respectively, for the Prior Year's Quarter. Basic and diluted weighted average common shares outstanding for the Quarter are 8,231,741 and 8,422,256, respectively, as compared to 8,231,741 and 8,456,627, respectively, for the Prior Year's Quarter.

For the nine months ended December 31, 2007 as compared to the nine months ended December 31, 2006, total revenues increased 8.3% to $662.1 million from $611.1 million; net earnings decreased 11.9% to $13.6 million from $15.5 million; and fully diluted earnings per share declined 9.4% to $1.63 from $1.80.

For the Quarter, sales of product and services decreased 8.1% to $168.4 million as compared to $183.3 million generated the Prior Year's Quarter, and represented 84.9% and 82.2% of total revenue, respectively. The cost of sales, product and services decreased 7.7% to $148.8 million as compared to $161.3 million the Prior Year's Quarter. The gross margin on sales of product and services was 11.6% in the Quarter as compared to 12.0% the Prior Year's Quarter.

Lease revenues decreased 23.8% to $12.2 million in the Quarter, and sale of leased equipment totaled approximately $13.7 million as compared to $2.6 million the Prior Year's Quarter. The net investment in leased assets was $161.1 million as of December 31, 2007, a 25.8% decrease from $217.0 million as of December 31, 2006. This decrease was due to a reduction in our direct financing lease portfolio resulting from the sale of lease schedules and termination of leases in our operating lease portfolio. Direct lease costs decreased 20.0% to $4.5 million in the Quarter.

For the Quarter, fee and other income was $4.1 million, an increase of 16.0% over the $3.5 million the Prior Year's Quarter, due to an increase in agent fees from manufacturers and an increase in revenue from sales of ePlus software in the technology sales business unit.

There was no patent settlement income during the Quarter or nine months ended December 31, 2007. During the three and nine months ended December 31, 2006, patent settlement income was $17.5 million.

Professional and other fees decreased 65.8% to $2.5 million for the Quarter, due to higher expenses incurred in the Prior Year's Quarter related to a lawsuit against SAP and expenses related to the Audit Committee's review of the Company's historical stock option grants, as previously disclosed in the Company's Form 10-K for the fiscal year ended March 31, 2007.

Salaries and benefits expenses decreased 4.9% to $17.1 million during the Quarter, driven by a reduction in the number of employees and lower sales commission expense resulting from a decrease in the revenue. The Company employed 649 people at December 31, 2007 as compared to 682 people at December 31, 2006. General and administrative expenses decreased 7.2% to $3.8 million during the Quarter, due to increased efficiency in spending controls and efforts to enhance productivity.

Interest and financing costs decreased 36.0% to $1.8 million during the Quarter, which resulted from decreases in recourse and non-recourse notes payable, the total of which decreased 38.1% to $104.7 million as of December 31, 2007 as compared to December 31, 2006.

The Company's cash and cash equivalents balance as of December 31, 2007 was $65.6 million, as compared to $39.7 million as of March 31, 2007.

The financial results presented herein are unaudited. Investors are encouraged to review the Company's Form 10-Q and to review other SEC filings including the Company's audited financial statements contained in the fiscal year 2007 Form 10-K.

About ePlus inc.

ePlus is a leading provider of technology solutions. ePlus enables organizations to optimize their IT infrastructure and supply chain processes by delivering world-class IT products from top manufacturers, professional services, flexible lease financing, proprietary software, and patented business methods. Founded in 1990, ePlus has approximately 650 associates in 30 offices serving more than 2,500 customers. The Company is headquartered in Herndon, VA. For more information, visit http://www.eplus.com , call 888-482-1122, or email info@eplus.com .