Empire Financial Holding Company Reports Financial Results for Third Quarter 2006

Share Name	Share Symbol	Market	Type
Empire Financial Holding	AMEX:EFH	AMEX	Ordinary Share

Empire (AMEX:EFH)
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Revenue Increases 29% for Nine Months but Flat for Third Quarter LONGWOOD, Fla., Nov. 13 /PRNewswire-FirstCall/ -- Empire Financial Holding Company (AMEX:EFH), a full service brokerage and investment banking firm serving retail and institutional clients, today reported its revenues were flat for the third quarter but increased 29% for the nine months ended September 30, 2006. Revenues for the third quarter ended September 30, 2006 were $6,452,705, essentially flat, as compared to revenues of $6,447,000 for the same period in 2005. The operating loss was ($705,538) compared to operating income of $238,568 for the same period in 2005. Net loss to common shareholders was ($533,917) compared to net income of $1,565,144 for the same period in 2005 or $(0.08) per diluted share in 2006 compared to $0.18 per diluted share for the same period in 2005. Net income for the three months and nine months ending September 30, 2005 included a deferred tax benefit of $1,384,000. Revenues for the nine months ended September 30, 2006 were $22,812,387, an increase of 29% for the same period in 2005. Operating loss for the nine months ended September 30, 2006 was ($6,938) compared to operating income of $627,680 for the same period in 2005. Net loss to common shareholders was ($115,680) compared to net income of $1,853,070 for the same period in 2005 or $(0.02) per diluted share in 2006, compared to $0.34 per diluted share for the same period in 2005. Total shareholders' equity of $8 million at September 30, 2006 was more than $5 million higher than the shareholders' equity reported at September 30, 2005. CEO Don Wojnowski said, "Although we are disappointed with the quarterly loss for the quarter ended September 30, 2006, it is important to note that during the quarter we recognized some one time expenses and invested in our operations in preparation for the significant growth we are expecting in 2007. We believe in 2006 we have built the infrastructure for the future by adding staff in sales & trading, investment banking, compliance and operations. The platform is largely built allowing us to add incremental business while increasing revenues, and earnings to build shareholder value." The Company will host a conference call Tuesday, November 14th at 8:30 am est. The dial-in number is 1-800-531-3250 -- PIN-3689703. About Empire Financial Holding Company Empire Financial Holding Company, through its wholly owned subsidiary, Empire Financial Group, Inc., provides full-service retail brokerage services through its network of independently owned and independently operated offices. Through its market-making and trading division, the Company offers securities order execution services for unaffiliated broker dealers and makes markets in domestic and international securities. Empire Financial also provides Investment Banking services for clients as well as turn-key fee based investment advisory and registered advisor custodial services through its wholly owned subsidiary, Empire Investment Advisors, Inc. Forward-Looking Statement Disclaimer This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties or other factors which may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause such a difference include, without limitation, fluctuations in the volume of transactional services provided by the Company, competition with respect to financial services commission rates, the effect of general economic and market conditions, factors affecting the securities brokerage industry as well as other risks and uncertainties detailed from time to time in the Company's Securities and Exchange Commission filings. EMPIRE FINANCIAL HOLDING COMPANY CONSOLIDATED STATEMENT OF FINANCIAL CONDITION (UNAUDITED) September 30, 2006 Assets Cash and cash equivalents ................................. $1,308,170 Marketable securities owned, at market value .............. 5,197,098 Commissions and other receivables from clearing organization ............................................. 1,229,089 Deposits at clearing organization ......................... 2,104,400 Furniture and equipment, net .............................. 274,568 Prepaid expenses and other assets ......................... 944,073 Deferred tax asset ........................................ 2,091,595 Cash in escrow ............................................ 350,000 Notes receivable .......................................... 4,539,648 ----------- Total assets ........................................... $18,038,641 =========== Liabilities and stockholders' equity Accrued expenses and other liabilities .................... $1,295,477 Due to clearing organization .............................. 3,400,015 Securities sold, but not yet purchased, at market value ... 1,360,097 Notes payable ............................................. 3,957,333 ----------- Total liabilities ...................................... 10,012,922 ----------- Commitments and Contingencies Stockholders' equity Convertible preferred stock, series B, C, D, E and F, $.01 par value 1,000,000 shares authorized 890,545 issued and outstanding .......................................... $8,905 Common stock, $.01 par value 100,000,000 shares authorized 7,009,037 shares issued and outstanding .................. 70,090 Additional paid-in capital ................................ 13,801,780 Accumulated deficit ....................................... (5,855,056) ----------- Total stockholders' equity ............................. 8,025,719 ----------- Total liabilities and stockholders' equity ............. $18,038,641 =========== EMPIRE FINANCIAL HOLDING COMPANY AND SUBSIDIARIES (UNAUDITED) CONSOLIDATED STATEMENTS OF INCOME THREE MONTHS THREE MONTHS ENDED ENDED September 30, September 30, 2006 2005 ------------- ------------- Revenues Commissions and fees ................... $3,423,710 $4,317,548 Trading income ......................... 2,564,447 2,009,452 Investment banking income .............. 464,548 120,000 ----------- ----------- 6,452,705 6,447,000 ----------- ----------- Expenses Employee compensation and benefits ..... 2,449,795 1,112,805 Commissions and clearing costs ......... 3,574,761 4,452,681 General and administrative ............. 1,030,122 576,027 Communications and data processing ..... 103,565 66,919 ----------- ----------- 7,158,243 6,208,432 ----------- ----------- Income (loss) from operations ............. (705,538) 238,568 Other income (expenses) Interest income ........................ 105,010 0 Interest expense ....................... (161,659) (38,932) ----------- ----------- (56,649) (38,932) ----------- ----------- Income (loss) before income taxes ......... (762,187) 199,636 Less: Provision for income taxes ....... 297,909 1,384,000 ----------- ----------- Net income (loss) ...................... (464,278) 1,583,636 Preferred stock dividends .............. (69,639) (18,492) ----------- ----------- Net income (loss) applicable to common shareholders .......................... $(533,917) $1,565,144 =========== =========== Basic and diluted earnings (loss) per share applicable to common shareholders: Earnings (loss) per share-basic and diluted ............................ $(0.08) $0.25 =========== =========== Earnings (loss) per share diluted ... $(0.08) $0.18 =========== =========== Weighted average shares outstanding: Basic ............................ 7,009,037 6,370,170 =========== =========== Diluted .......................... 7,009,037 8,522,601 =========== =========== EMPIRE FINANCIAL HOLDING COMPANY AND SUBSIDIARIES (UNAUDITED) CONSOLIDATED STATEMENTS OF INCOME NINE MONTHS NINE MONTHS ENDED ENDED September 30, September 30, 2006 2005 ------------- ------------- Revenues Commissions and fees ................... $13,113,457 $12,632,605 Trading income ......................... 7,769,540 4,813,481 Investment banking income .............. 1,929,390 253,910 ----------- ----------- 22,812,387 17,699,996 ----------- ----------- Expenses Employee compensation and benefits ..... 7,508,151 3,502,849 Commissions and clearing costs ......... 12,223,771 11,267,691 General and administrative ............. 2,832,756 2,142,770 Communications and data processing ..... 254,647 159,006 ----------- ----------- 22,819,325 17,072,316 ----------- ----------- Income (loss) from operations ............. (6,938) 627,680 Other income (expenses) Interest income ........................ 296,182 0 Interest expense ....................... (207,397) (121,481) ----------- ----------- 88,785 (121,481) ----------- ----------- Income before income taxes ................ 81,847 506,199 Less: Provision for income taxes ....... (25,405) 1,384,000 ----------- ----------- Net income ............................. 56,442 1,890,199 Preferred stock dividends .............. (172,122) (37,129) ----------- ----------- Net income (loss) applicable to common shareholders .......................... $(115,680) $1,853,070 =========== =========== Basic and diluted earnings (loss) per share applicable to common shareholders: Earnings (loss) per share-basic and diluted ............................ $(0.02) $0.39 =========== =========== Earnings (loss) per share diluted ... $(0.02) $0.34 =========== =========== Weighted average shares outstanding: Basic ............................ 7,009,037 4,772,065 =========== =========== Diluted .......................... 7,009,037 5,399,468 =========== =========== DATASOURCE: Empire Financial Holding Company CONTACT: Donald A. Wojnowski Jr., President of Empire Financial Holding Company, +1-407-551-1841, or fax, +1-407-830-5078,

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EFH Empire Financial Holding