The Marketing Alliance Announces Financial Results for the Fiscal 2008 Third Quarter and Nine Months Ended December 31, 2007

  
    
  
  
    
      The Marketing Alliance, Inc. (Pink Sheets: MAAL) (“TMA”), 
      a consortium of independent life insurance brokerage general 
      agencies located throughout the United States, today announced financial 
      results for its fiscal third quarter ended December 31, 2007.
    
    
      Timothy M. Klusas, TMA’s President, stated, “We 
      think that our Company is focusing on the right things. I thought it 
      might be an appropriate time to outline some of the recent progress we 
      have made, and the direction that we are headed. In an effort to 
      describe our business in general, we are a distribution company and the 
      products we distribute are insurance and annuity products, from 
      insurance carriers to independent insurance agencies. We believe this is 
      a business that requires a streamlined, cost-efficient infrastructure to 
      operate most profitably. When we consolidated our sales and marketing 
      offices into one centralized facility in 2006, the goal was to begin to 
      centralize our operations and create a platform on which to handle 
      incremental business growth without significant increases in fixed 
      costs. This was a difficult and lengthy process that involved a 
      substantial restructuring, but one that we feel we have made good 
      progress upon. We remained focused on improving margins and operating 
      profitably throughout this period, and plan to continue to take 
      advantage of increased efficiencies.”
    
    
      Mr. Klusas continued, “With an infrastructure 
      in place, we have turned our attention to growth initiatives - building 
      on a wide array of different life and annuity products to offer our 
      agencies from a deeper network of carriers. Our operating results during 
      the fiscal third quarter are attributable to a number of these 
      initiatives, and we were pleased to achieve a 6% increase in revenues 
      for the period. This increase is attributed to growth in our 
      wholly-owned annuity business, TMA Marketing, Inc. (“TMAM”), 
      as well as benefits from additions to our carrier network. I would like 
      to specifically address the benefits and impact of these initiatives:
    
    
      
        Our wholly-owned “turnkey” 
        annuity business, TMAM, which was previously only targeted at 
        distributors new to the annuity business, now functions on multiple 
        levels as a result of a new incentive plan launched in March 2007. 
        Previously, TMAM engaged agencies looking to enter the annuity 
        business and build their product offerings and back office processing 
        from the ground up. While we achieved success offering this to our 
        distributors, we found that many of our members who already had 
        existing annuity businesses in place wanted to take advantage of an 
        expanded offering of services and products to suit their customers’ 
        needs. With our flexibility, we are now attracting these agencies, 
        providing them with value added services from sales support to 
        business placement, and have nurtured a new revenue stream for our 
        Company. We are hopeful that as we expand our annuity business, we 
        will be able to continue to offer a wider variety of offerings for our 
        distributors, while at the same time contributing to our top-line with 
        minimal incremental operating cost.
      
      
        We are also now recognizing more revenue from the additions of new 
        carriers and a wider product offering to our network, most 
        specifically ING, MetLife, and Aviva. We expect to see revenues 
        continue to trend higher during the next 12-24 months, as these 
        carriers are more fully integrated into our sales network, and 
        consider new additions to our network as a catalyst for future growth.”
      
    
    
      Mr. Klusas concluded, “Although our 
      operations are in a strong position, our net earnings for the period 
      were negatively impacted by a loss on investments. These holdings are 
      managed in part by third parties and consist largely of equities. We 
      continue to monitor our holdings and will adjust as necessary for the 
      changing economic climate. We are confident in our investment management 
      providers based on their track records. We are supported by a strong 
      balance sheet, and feel that the strides made by the Company in the past 
      three years have placed TMA in a better position to achieve growth 
      through a wider variety of channels. We look forward to keeping all of 
      our shareholders apprised of our progress in the coming months.”
    
    
      FISCAL 2008 THIRD QUARTER REVIEW
    
    
      Total revenues for the three-month period ended December 31, 2007 
      increased 6% to $4.5 million from $4.2 million for the three-month 
      period ended December 31, 2006. The increase in revenues was due to 
      increased volume at TMA’s wholly-owned 
      subsidiary, TMA Marketing as well as higher revenues from the addition 
      of ING, MetLife and Aviva to its carrier network. As a result of higher 
      revenues, TMA’s net operating revenue (gross 
      profit) grew from the comparable fiscal 2007 period.
    
    
      Operating income for the fiscal third quarter increased to $311,088, or 
      6.9% of revenues, from $179,107, or 4.2% of revenues in the prior third 
      quarter. Operating expenses for the period decreased to $590,337, or 
      13.1% of revenues, from $655,410, or 15.5% of revenues, in the third 
      quarter of fiscal 2007. The decrease in operating expenses is due to the 
      aforementioned centralization in the Company’s 
      business and increasing economies of scale.
    
    
      For the fiscal 2008 third quarter, TMA reported a net loss of 
      ($274,163), or ($0.14) per share, based on 1,977,675 shares outstanding, 
      versus a net income of $156,957, or $0.08 per share, based on 2,036,747 
      shares outstanding, for the fiscal 2007 third quarter. The net loss for 
      the period is primarily due to a realized and unrealized loss on 
      investments of ($814,330), compared to a gain of $72,778 for the prior 
      year period. The decrease in shares outstanding is due to the Company’s 
      execution of its share repurchase program.
    
    
      FISCAL 2007 NINE MONTH REVIEW
    
    
      Total revenues for the first nine months of fiscal 2008 were $12.3 
      million, an increase of 4% versus $11.8 million for the same period in 
      fiscal 2007. Fiscal 2007 nine month operating income increased 122% to 
      $903,229 from $407,251 for the first nine months of fiscal 2007. TMA 
      reported net income of $180,643, or $0.09 per share, for the nine-month 
      period ended December 31, 2007, versus net income of $251,452 or $0.12 
      per share, in the prior year period.
    
    
      FINANCIAL CONDITION
    
    
      TMA’s balance sheet at December 31, 2007 
      reflected working capital of $3.6 million and no long-term debt. 
      Shareholders’ equity at December 31, 2007 
      totaled $3.9 million.
    
    
      ABOUT THE MARKETING ALLIANCE, INC.
    
    
      Headquartered in St. Louis, MO, TMA is one of the largest organizations 
      providing support to independent insurance brokerage agencies, with a 
      goal of providing members value-added services on a more efficient basis 
      than they can achieve individually. TMA’s 
      network is comprised of independent life brokerage and general agencies 
      in 43 states. Investor information can be accessed through the 
      shareholder section of TMA’s website at http://www.themarketingalliance.com/si_who.cfm.
    
    
      TMA stock is quoted in the “pink sheets” 
      (www.pinksheets.com) under the 
      symbol “MAAL”.
    
    
      FORWARD LOOKING STATEMENT
    
    
      Investors are cautioned that forward-looking statements involve risks 
      and uncertainties that may affect TMA's business and prospects. Any 
      forward-looking statements contained in this press release represent our 
      estimates only as of the date hereof, or as of such earlier dates as are 
      indicated, and should not be relied upon as representing our estimates 
      as of any subsequent date. These statements involve a number of risks 
      and uncertainties, including, but not limited to, general changes in 
      economic conditions. While we may elect to update forward-looking 
      statements at some point in the future, we specifically disclaim any 
      obligation to do so.
    
    
      
        
          
            CONSOLIDATED STATEMENT OF OPERATIONS
          
        
      
      
        
          
             
          
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
        
        
           
        
        
        
      
      
        
        
        
        
        
          Quarter Ended
        
        
        
        
          Year to Date
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
          9 Months Ended
        
      
      
        
        
        
        
        
        
        
          12/31/2007
        
        
        
        
        
        
        
        
          12/31/2006
        
        
        
        
        
        
        
        
          12/31/2007
        
        
        
        
        
        
        
        
          12/31/2006
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Revenues
        
        
        
        
          $
        
        
          4,490,143
        
        
           
        
        
        
        
          $
        
        
          4,237,426
        
        
           
        
        
        
        
          $
        
        
          12,314,099
        
        
           
        
        
        
        
          $
        
        
          11,802,741
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Distributor Related Expenses
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Distributor bonus & commissions paid
        
        
        
        
          $
        
        
          3,063,631
        
        
        
        
        
        
        
        
          2,731,741
        
        
        
        
        
        
        
        
          7,732,901
        
        
        
        
        
        
        
        
          7,273,794
        
        
        
      
      
        
          Distributor benefits & processing
        
        
        
        
           
        
        
          525,087
        
        
           
        
        
        
        
           
        
        
          671,168
        
        
           
        
        
        
        
           
        
        
          1,820,978
        
        
           
        
        
        
        
           
        
        
          2,068,503
        
        
           
        
      
      
        
          Total
        
        
        
        
           
        
        
          3,588,718
        
        
           
        
        
        
        
           
        
        
          3,402,909
        
        
           
        
        
        
        
           
        
        
          9,553,879
        
        
           
        
        
        
        
           
        
        
          9,342,297
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net Operating Revenue
        
        
        
        
        
        
          901,425
        
        
        
        
        
        
        
        
          834,517
        
        
        
        
        
        
        
        
          2,760,220
        
        
        
        
        
        
        
        
          2,460,444
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating Expenses
        
        
        
        
           
        
        
          590,337
        
        
           
        
        
        
        
           
        
        
          655,410
        
        
           
        
        
        
        
           
        
        
          1,856,991
        
        
           
        
        
        
        
           
        
        
          2,053,193
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating Income
        
        
        
        
        
        
          311,088
        
        
        
        
        
        
        
        
          179,107
        
        
        
        
        
        
        
        
          903,229
        
        
        
        
        
        
        
        
          407,251
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Other Income (Expense)
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
      
      
        
          Interest & dividend income [net]
        
        
        
        
        
        
          25,517
        
        
        
        
        
        
        
        
          14,400
        
        
        
        
        
        
        
        
          72,459
        
        
        
        
        
        
        
        
          30,138
        
        
        
      
      
        
          
            Realized & unrealized gains [losses] 
            on investments (net)
          
        
        
        
        
        
        
          (814,330
        
        
          )
        
        
        
        
        
        
          72,778
        
        
        
        
        
        
        
        
          (693,582
        
        
          )
        
        
        
        
        
        
          (5,529
        
        
          )
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Interest expense
        
        
        
        
           
        
        
          (38
        
        
          )
        
        
        
        
           
        
        
          (5,328
        
        
          )
        
        
        
        
           
        
        
          (2,063
        
        
          )
        
        
        
        
           
        
        
          (14,408
        
        
          )
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Income (Loss) Before Provision for Income Tax
        
        
        
        
        
        
          (477,763
        
        
          )
        
        
        
        
        
        
          260,957
        
        
        
        
        
        
        
        
          280,043
        
        
        
        
        
        
        
        
          417,452
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Benefit (Provision) for income taxes
        
        
        
        
           
        
        
          203,600
        
        
           
        
        
        
        
           
        
        
          (104,000
        
        
          )
        
        
        
        
           
        
        
          (99,400
        
        
          )
        
        
        
        
           
        
        
          (166,000
        
        
          )
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Net Income (Loss)
        
        
        
        
          $
        
        
          (274,163
        
        
          )
        
        
        
        
          $
        
        
          156,957
        
        
           
        
        
        
        
          $
        
        
          180,643
        
        
           
        
        
        
        
          $
        
        
          251,452
        
        
           
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Average Shares Outstanding
        
        
        
        
        
        
          1,977,675
        
        
        
        
        
        
        
        
          2,036,747
        
        
        
        
        
        
        
        
          2,006,961
        
        
        
        
        
        
        
        
          2,036,747
        
        
        
      
      
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Operating Income per Share
        
        
        
        
          $
        
        
          0.16
        
        
        
        
        
        
          $
        
        
          0.09
        
        
        
        
        
        
          $
        
        
          0.45
        
        
        
        
        
        
          $
        
        
          0.20
        
        
        
      
      
        
          Net Income (Loss) per Share
        
        
        
        
          $
        
        
          (0.14
        
        
          )
        
        
        
        
          $
        
        
          0.08
        
        
        
        
        
        
          $
        
        
          0.09
        
        
        
        
        
        
          $
        
        
          0.12
        
        
        
      
    
    
      
        
          
            CONSOLIDATED SELECTED BALANCE SHEET ITEMS
          
        
      
      
        
          
             
          
        
      
      
        
        
        
           
        
        
          As of
        
      
      
        
        
        
        
        
        
        
           
        
        
        
      
      
        
          Assets
        
        
        
        
        
        
          12/31/2007
        
        
        
        
        
        
          3/31/2007
        
      
      
        
          Current Assets
        
        
        
        
        
        
        
        
        
      
      
        
          Cash
        
        
        
        
          $
        
        
          843,020
        
        
        
        
          $
        
        
          1,283,240
        
      
      
        
          Receivables
        
        
        
        
        
        
          4,444,534
        
        
        
        
        
        
          4,497,987
        
      
      
        
          Investments
        
        
        
        
        
        
          3,523,123
        
        
        
        
        
        
          2,715,997
        
      
      
        
          Other
        
        
        
        
           
        
        
          193,107
        
        
        
        
           
        
        
          32,105
        
      
      
        
          Total Current Assets
        
        
        
        
        
        
          9,003,784
        
        
        
        
        
        
          8,529,329
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Other Non Current Assets
        
        
        
        
           
        
        
          289,214
        
        
        
        
           
        
        
          367,571
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total Assets
        
        
        
        
          $
        
        
          9,292,998
        
        
        
        
          $
        
        
          8,896,900
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Liabilities & Stockholders' Equity
        
        
        
        
        
        
        
        
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total Current Liabilities
        
        
        
        
          $
        
        
          5,385,549
        
        
        
        
          $
        
        
          4,707,409
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Total Liabilities
        
        
        
        
        
        
          5,385,549
        
        
        
        
        
        
          4,707,409
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Stockholders' Equity
        
        
        
        
           
        
        
          3,907,449
        
        
        
        
           
        
        
          4,189,491
        
      
      
        
        
        
        
        
        
        
        
        
           
        
      
      
        
          Liabilities & Stockholders' Equity
        
        
        
        
          $
        
        
          9,292,998
        
        
        
        
          $
        
        
          8,896,900