HOWELL, MI--(MARKET WIRE)—Aug 22, 2007 -- Marketing Worldwide Corporation (MWW) (OTC BB:MWWC.OB - News), a leader in car customization programs for major auto manufacturers, today announced that it filed with the SEC its report for the Third Quarter of 2007, which ended June 30, 2007.

The Company is reporting an extraordinary financial quarter in which it concluded a $3.5 million Series A Preferred Stock financing and the acquisition of Colortek, a “Class A” painting facility in Baroda, Michigan. Accordingly, the company recorded larger than normal non-cash and cash expenses and an additional one time non-cash impairment charge impacting its balance sheet and income statement. Based on these extraordinary charges, net income was reduced by $5,197,641.

"This third quarter of 2007 has been a significant and extraordinary quarter for us,” said Michael Winzkowski, President, MWW. “Our financials reflect several large non-cash charges and other one-time increases in expenses that are key investments in expediting MWW’s plan to expand our business and produce greater value for our shareholders.

“As announced on April 26, 2007, we concluded a Private Placement for $3.5 million in the form of a Series A Preferred Stock, providing the Company with the required cash to advance the expansion plan for our business.

“In June 2007, in accordance with our strategy for vertical integration, we successfully completed the acquisition of Colortek Inc, a “Class A” automotive painting facility. The acquisition of Colortek secures one of the most crucial segments in our supply chain and allows us to address additional large OE customers that require strong vertical integration in their certified suppliers. Colortek is already a certified supplier for Ford, Chrysler and GM, and MWW expects that Colortek will add significant additional revenue to MWW in the short and mid term.”

The majority of the Company’s decrease ($3,500,000) was a non-cash expense associated with the private placement financing and the associated costs for warrants and dividends attached to this financing. The Company recognized an imbedded beneficial conversion feature present in the Convertible Series A Preferred Stock and allocated a portion of the proceeds equal to the fair value of that feature to additional paid-in capital. The Company recognized and measured an aggregate of $3,500,000 of the proceeds, which is equal to the intrinsic value of the imbedded beneficial conversion feature, to additional paid-in capital and a charge against current earnings. The fair value of the warrants was determined using the Black-Scholes Option Pricing Model. In the quarter we also recorded additional expenses, such as placement agent and other professional fees, and an increase in associated legal, auditing and consulting fees in connection with the financing and the acquisition.

As a result of the acquisition of Colortek, management also recorded a non-cash impairment charge of $955,897, net of tax, or $0.08 per share during the three months ended June 30, 2007 to reduce the carrying value of the goodwill to $ 0. (For more detail, please see our Form 10QSB for the period ended June 30, 2007, filed with the SEC).

A smaller portion of the decrease resulted from lower sales due to delays in several customer program launches as well as an increase in cost for professional consulting services representing a non-cash expense, and higher selling, general and administrative expenses. These were offset by improvements in gross margins from 27% to 33%.

Mr. Winzkowski concluded, “MWW’s strong cash position provides the required capital to execute our business plan and accordingly, we continue to expand our management team and product roster. We have acquired large new customers such as KIA Motors USA and we’re aggressively pursuing others. Several new products have been presented for upcoming Toyota model launches and we expect our customers to approve these programs shortly. We believe that the investments of the past quarter position MWW for greater market share in our industry and greater long-term value for our shareholders.”

The Company's largest customers are Southeast Toyota, Gulf States Toyota, Toyota Canada International and Toyota Motor Manufacturing Company in Canada. MWW has also begun delivering first products to KIA Motors USA and has been awarded an excellence award for "Most Valuable Supplier" by KIA.