Adam Inc (863650) SEC Filing 10-K Annual report for the fiscal year ending Sunday, December 31, 2006

Revenues for the fourth quarter ended December 31, 2006 were $6,835,000 as compared to $2,507,000 in the year-ago period, an increase of 173%. The increase in revenue is attributable to the acquisition of Online Benefits, which was completed in August 2006, growth in A.D.A.M.’s content licensing revenues and growth in sales of A.D.A.M.’s educational and print products.

Revenues for the year ended December 31, 2006 were $16,505,000 as compared to $10,054,000 in the year-ago period, an increase of 64%. Recurring license revenues accounted for 84% of 2006 total revenues.

Operating income for the fourth quarter ended December 31, 2006, which included severance costs of $485,000, increased to $1,051,000 or 15.4% of revenues. Adjusted operating income for the quarter was $1,740,000, or 25.5% of revenues.

Operating income for the year ended December 31, 2006 was $3,132,000 or 19% of revenues. Adjusted operating income for the year was $4,041,000, or 24.5% of revenues.

Net income for the year ended December 31, 2006 was $2,548,000 or $0.25 per share on a fully diluted basis, compared to net income of $7,062,000, or $0.75 per share on a fully diluted basis, for the year ended December 31, 2005. Net income for the year ended December 31, 2005 included a $5,500,000 tax benefit. Adjusted net income for the year ended December 31, 2006 was $3,457,000 or $0.34 per share on a fully diluted basis, compared to $2,106,000 or $0.22 per share on a fully diluted basis, for the year ended December 31, 2005.

As of December 31, 2006, cash and investments were approximately $7,240,000. For the year ended December 31, 2006, adjusted EBITDA was $4,913,000, an increase from $2,786,000 for the year ended December 31, 2005.