IceWeb Reports 2008 Results

DULLES, Va. -- IceWEB, Inc. (OTCBB:IWEB), a leadingstorage technology company and provider of computing hardware, on-demandsoftware, advanced networking solutions and innovative online services,today announced that it has filed its Form 10KSB with the U.S.Securities and Exchange Commission for the 2008 fiscal year, endedSeptember 30, 2008.

For fiscal 2008, we reported sales of $16,294,423 as compared to netrevenues of $18,732,069 for fiscal 2007, a decrease of $2,437,646 orapproximately 13%. Of our total net revenues for fiscal 2008,approximately $14,886,699 is attributable to third party product salesby our IceWEB Solutions Group, approximately $982,049 is attributable toour sale of storage products, and approximately $425,676 is attributableto revenues from our online products and services.

Gross profit increased to $2,226,794 in fiscal 2008, from $1,920,795 infiscal 2007, an increase of 15.9%. Gross margin percent improved from10.25% to 13.67%. The improvement in margins is attributable to the saleof higher margin storage products and improving margins in the hardwareand software solutions business.

The fiscal 2008 net loss of $6,410,793, or $0.35 per share, included theimpact of the acquisition of Inline Corporation, which contributed$1,244,105 to the loss. In addition, non cash expenses includeddepreciation and amortization of $575,498, share-based compensation of$1,573,363, and amortization of deferred compensation expense of $910,930.

John R. Signorello, Chairman and Chief Executive Officer of IceWEB,Inc., stated, In 2008 we invested in our future – while simultaneouslylowering overhead expenses - by acquiring INLINE Corporation, a datastorage company. Over the course of the year, we continued to makestrategic product and marketing investments to enhance our efforts intothe fast-growing GIS markets. Our IT Solutions business compliments ourstorage efforts and is targeted for both the defense and civilian agencysides of the Federal Government market places. We anticipate 2009 to bea year in which our 2008 investments will yield significantly improvedgross margins and fuel our growth in GIS and other fast growth storagemarkets.”IceWEB Inc.