Humpty's Restaurants International Inc. Second Quarter 2007 Results

Humpty's Restaurants International Inc. (TSX VENTURE:HMP) today released
financial results for the 6-month period ending June 30, 2007.




                                     For the 6- Months ended June 30
                                           2007                 2006
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Consolidated Revenue:                $6,415,967           $5,616,172
Net Income:                             227,501              199,945
Net Income/Share:                         0.015                0.014
Shares Outstanding:                  14,691,785           14,783,785
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We are pleased to present the Second Quarter Report of Humpty's Restaurants
International Inc. (H.R.I.I.) for the six months ended June 30, 2007. Net income
for the period decreased 11.7% ($126,442 vs. $143,216) from the same fiscal
period in 2006. However the income results were positive, therefore, the
operating results for the six-month period ended June 30, 2007 improved 13.8%
(net income $227,501 vs. net income $199,945 in fiscal 2006).


Year-over-year Second Quarter combined revenue (Franchise revenue and Restaurant
operations) increased favourably by 12.3% during the period from $3.07 million
(Q2/06) to $3.44 million (Q2/07). Franchise revenue increased by 0.9% whereas
Restaurant operations had an increase of 16.5%. Earnings before interest,
amortization and taxes decreased by nearly $23,000 (6.8%) from the same period
in 2006. The differences can be attributed solely to the disappointing
performance of Restaurant operations. Despite an increase of 16.5% in revenue
the profit dollars that were contributed decreased by 78.1%. The increase of
29.3% in operating expenses was the main contributor of the reduced
profitability. Achieving 100% full hours of operation was not accomplished in
the Second Quarter therefore considerable revenue was not forthcoming. This
extra revenue would have justified much of the additional expenses.
Approximately $52,000 of leasehold improvements was expensed in the Second
Quarter for Corporate locations in Calgary and Nanton. Salaries and employee
benefits increased by 15.2% and despite an increase of 16.5% in revenue this
category should only increase by 33% of the revenue growth. The labour shortage
is forcing us to continually award increased salary adjustments and expense
considerable training dollars.


Our industry, like many other business operations in Western Canada, continues
to experience serious staff shortages. Unfortunately we cannot properly manage
our businesses without people. The positive side to the whole equation is that
we are experiencing very strong revenue growth. Along the way it is forcing us
to be better managers. As we continue to develop people the productivity will
improve thus the margins. Unfortunately Western Canada does not have the
available manpower to feed the increased economic growth therefore we will
continue to depend on foreign employees. By the end of the Third Quarter we will
have received and trained over twenty-five of these workers with another
twenty-five to come. Two of our current foreign workers are already being
trained for management positions and we see the opportunity for others to
achieve these management goals. We describe the current labour dilemma as
short-term pain for long-term gain.


We are still optimistic looking forward to the remainder of 2007. Our mandate is
to explore and examine every opportunity that presents itself to grow the system
geographically, however, we must remain diligent in our efforts to assist our
existing Franchisees and Corporate Managers in improving sales and
profitability.


For detailed financial information, audited statements can be found at
www.sedar.com.