NUVO Reports Second Quarter Results: 6th Consecutive Quarter of Positive EBITDA

NUVO Network Management Inc., (TSX VENTURE: NVO), a leading software and managed services provider of solutions that MAXimize IT® availability and performance, today announced results from operations for its second quarter ended March 31, 2007.

Highlights

- Our new On-Demand Network Management Software functionality, MAXadvantage, was expanded to add an active Topology network map, IT asset inventory, problem ticketing, change management and customizable notification

- Revenues increased to $4.302 million from $4.061 million last year

- Gross margins improved to 42% from 38% last year

- Earnings before interest, taxes, depreciation and amortization (EBITDA) was $522,361 compared to $507,313 last year

- Net income was $112,659 compared to net income of $61,208 last year

- Six consecutive quarters of positive EBITDA

- Signed $4.6 million of new contracts and renewals

"We are pleased with our second quarter results", said Phil Weaver, NUVO's President and CEO. "We increased our net income by 84% to $112,659, recorded record revenues of $4,302,423 and strengthened our gross margin to 42%. We continued to have strong bookings this quarter, with new orders and renewals totaling $4.6 million."

"During the quarter we launched our new web site designed to reflect our new software product, MAXadvantage. We also launched our first web-based marketing campaign. We will build on this campaign to accelerate product adoption and revenue results. In addition, we are adding the ability to receive and process orders on-line to our website. This feature will make it easier for our customer's to order our software, expanding our reach to include the SMB market in addition to our current strength in large and mid-sized enterprises. We believe our ability to service large, medium and small enterprises with a solutions ranging from fully managed network, server, security and IPT services to our hosted MAXadvantage software sets us apart from most software and managed services companies."

Q2 Financial Results

Second quarter revenues were $4,302,423 compared with revenues of $4,061,621 in the same period a year ago. Second quarter IT infrastructure management revenues were $3,748,207 compared to IT infrastructure management revenues of $3,470,240 in the second quarter of fiscal 2006. Maintenance, support and equipment revenues for the second quarter were $554,216 compared to $591,381 last year. Total revenue for the six months ended March 31, 2007 and 2006 were $8,456,264 and $8,012,332, respectively.

Gross margins for the second quarter of fiscal 2007 were 42% compared with 38% in the second quarter of fiscal 2006. For the six months ended March 31, 2007 and 2006, gross margins were 42% and 37%, respectively.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) for the second quarter of fiscal 2007 was $522,361 compared to EBITDA of $507,313 in the same period a year ago. EBITDA for the six months ended March 31, 2007 was $1,001,356 compared to EBITDA of $727,394 for the six months ended March 31, 2006.

Net income in the second quarter was $112,659 compared to net income of $61,208 in the second quarter of fiscal 2006. Net income for the six months ended March 31, 2007 was $232,417 compared to net loss of $209,423 for the six months ended March 31, 2006.

About NUVO

NUVO provides remote management and protection of IT infrastructures for businesses worldwide to maximize the availability of their computing infrastructure. NUVO enables our customers to excel by delivering fully integrated, proactive management software, services and business data. This provides the critical information needed for effective analysis and decision-making to maximize performance and control costs. NUVO achieves this through certified experts, best-of-class technology, deep integration, highly automated processes, and best practices in a 24x7, resilient infrastructure. www.nuvo.com.

Forward Looking Statements

Certain statements included in this press release are forward-looking and are subject to certain risks and uncertainties. The results or events predicted in these statements may differ materially from actual results or events. Factors that may cause results or events to differ from current expectations include, but are not limited to, those set out on NUVO's website at http://www.nuvo.com/news/fls.html.

Second Quarters Ended March 31, 2007 and 2006
(Unaudited)

                         Three Months Ended        Six Months Ended
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                       March 31,   March 31,   March 31,   March 31,
                           2007        2006        2007        2006
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Revenues
  IT Infrastructure
   management        $3,748,207  $3,470,240  $7,351,866  $6,771,812
  Maintenance,
   support and
   equipment            554,216     591,381   1,104,398   1,240,520
---------------------------------------------------------------------
                      4,302,423   4,061,621   8,456,264   8,012,332
---------------------------------------------------------------------
Costs of revenues
  IT Infrastructure
   management         2,167,190   2,120,644   4,263,471   4,233,717
  Maintenance,
   support and
   equipment            331,476     387,562     677,822     807,906
---------------------------------------------------------------------
                      2,498,666   2,508,206   4,941,293   5,041,623
---------------------------------------------------------------------

Gross margin          1,803,757   1,553,415   3,514,971   2,970,709
---------------------------------------------------------------------

Selling and
 marketing              645,061     585,353   1,229,376   1,239,889
General and
 administration         596,241     500,998   1,176,563     995,697
Research and
 development            274,156     196,173     552,786     474,724
Stock-based
 compensation
 expense                 29,749      25,000      56,749      43,000
Amortization of
 purchased
 intangibles            106,317     148,225     212,634     341,080
---------------------------------------------------------------------
                      1,651,524   1,455,749   3,228,108   3,094,390
---------------------------------------------------------------------

Operating income
 (loss)                 152,233      97,666     286,863    (123,681)
Interest and other
 income (expense)       (39,574)    (36,458)    (54,446)    (85,742)
---------------------------------------------------------------------
Net income (loss)
 for the period        $112,659     $61,208    $232,417   $(209,423)
---------------------------------------------------------------------
---------------------------------------------------------------------

Basic earnings
 per common share         $0.00       $0.00       $0.01      $(0.01)
Diluted earnings
 per common share         $0.00       $0.00       $0.01      $(0.01)

Weighted average
 number of common
 shares used in:
  Basic earnings
   per common share
   calculation       30,970,439  29,843,120  30,970,439  29,843,120
  Diluted earnings
   per common share
   calculation       31,101,406  29,915,019  31,140,795  29,870,898



CONSOLIDATED BALANCE SHEETS


                                                As at         As at
                                             March 31, September 30,
                                                 2007          2006
                                           (Unaudited)     (Audited)
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ASSETS
Current
  Cash and cash equivalents                $1,866,013    $1,760,919
  Accounts receivable                       2,444,477     2,179,970
  Tax credits receivable                      306,087       406,085
  Work in process                              67,738       443,884
  Prepaid expenses and other assets           901,105       880,233
---------------------------------------------------------------------
                                            5,585,420     5,671,091

Other assets (note 6)                         233,593       265,591
Capital assets                              3,025,289     2,989,783
Purchased intangibles                       1,223,677     1,436,311
Goodwill                                    9,917,938     9,917,938
---------------------------------------------------------------------
                                          $19,985,917   $20,280,714
---------------------------------------------------------------------
---------------------------------------------------------------------
LIABILITIES
Current
  Accounts payable and accrued
   liabilities                             $2,042,484    $2,627,313
  Deferred revenue                          1,252,073     1,028,936
  Current portion of long-term
   obligations                                793,481       851,603
---------------------------------------------------------------------
                                            4,088,038     4,507,852

Long-term obligations                         309,480       473,629
---------------------------------------------------------------------
                                            4,397,518     4,981,481
---------------------------------------------------------------------

SHAREHOLDERS' EQUITY
Share capital                              24,454,705    24,397,956
Deficit                                    (8,866,306)   (9,098,723)
---------------------------------------------------------------------
                                           15,588,399    15,299,233
---------------------------------------------------------------------

                                          $19,985,917   $20,280,714
---------------------------------------------------------------------
---------------------------------------------------------------------

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