Strong SafeNet(TM) Sales Result in Third Quarter Revenue Growth for IRE

BALTIMORE, Nov. 6 /PRNewswire/ -- Information Resource Engineering Inc. (Nasdaq: IREG), a leading provider of encryption-based Internet security systems, today reported that the Company had a 51% increase in revenues for the period ending September 30, 1997 compared to the same period in 1996. For the three months ended September 30, 1997, revenues were $4,039,359 compared to revenues of $2,673,524 for the same three months in 1996. The Company reported a net loss of $789,113 in the third quarter of 1997 compared to a loss of $1,586,207 for the same quarter in 1996. The loss per common share was $.14 in the third quarter as compared to a loss of $.29 per share in the third quarter of 1996. Revenues for the nine months ended September 30, 1997 were $10,926,088 compared to revenues of $11,069,759 for the same period in 1996, with losses of $3,131,261 and $2,735,396, respectively. The loss per common share for the first nine months of 1997 and 1996 was $.57 and $.52, respectively.

"Since the third quarter of 1996, IRE has increased sales without significantly increasing expenses," explained IRE Chairman Anthony Caputo. "As a result, both revenues and gross margins, now at 57%, are improving, driving IRE closer to profitability."

"The IRE SafeNet(TM) Internet security product family continues to save clients significant capital, allowing them to use the Internet for business," Mr. Caputo further commented. "The State of Maryland, Credit Management Solutions, Inc. and Interbanking S.A. in Argentina are using these products today to enable electronic business, saving them AND their clients time and money."

"In order to move IRE products to the broad market, we announced in October, the debut of the SafeNet Partner Program. An indirect sales channel, the SafeNet Partner Program gives the enterprise corporation a single source solution to shifting their business on-line. Major VARs, ISPs and Systems Integrators are tasked with selling the SafeNet product line and reducing sales expenses traditionally associated with a direct sales strategy."

"IRE is now an organization comprised of 3 primary areas -- product, OEM, and service sales. We are better equipped to respond to the growing network communications market. The addition of Crypt/IC to our SafeNet product line will further broaden the scope of our offering. Slated for availability in the first half of 1998, Crypt/IC is an ideal solution for major software, computer and communications manufacturers looking to offer hardware-strength security at software margins and prices."

"As we continue to integrate powerful security -- IRE security -- into products for the enterprise, we should see an expansion in using these products to create virtual private networks (VPNs). As organizations worldwide realize the Internet can, in fact, be a safe place to conduct business, IRE will be there to provide the critical component -- security."

About IRE

A leader in the network security industry since the Company's inception in 1983, IRE provides comprehensive network security systems worldwide for remote access, electronic commerce and distributed business communication applications. Using advanced encryption technology, IRE's broad product solutions protect sensitive data transmissions on computer networks, such as the Internet.

Organizations using IRE products include J.P. Morgan & Company, Chase Manhattan Bank, Bank of New York, and Banc One. IRE systems are installed at a number of major international organizations including Euroclear Operations Centre in Brussels, the Central Bank of Sweden, and the Post Office Savings Bank of Singapore. The United States Treasury Department, TRW and the Federal Bureau of Investigation also use IRE Secure Communications Systems to protect sensitive data. IRE has its U.S. headquarters in Baltimore, Maryland and its branch offices worldwide.

SafeNet is a trademark of Information Resource Engineering, Inc.

Statements in this release concerning IRE's future prospects are "forward- looking statements" under the Federal securities laws. There can be no assurance that future results will be achieved, and actual results could differ materially from forecasts, estimates, and summary information contained in this news release. Important factors that could cause actual results to differ materially are included but are not limited to those listed in IRE's periodic reports filed with the Securities and Exchange Commission.

                                  Three Months Ended      Nine Months Ended                                    September 30,           September 30,                                   1997       1996       1997        1996     Revenues               $4,039,359  $2,673,524  $10,926,088  $11,069,759     Net loss                 (789,113) (1,586,207)  (3,131,261)  (2,735,396)     Loss per common share        (.14)       (.29)        (.57)        (.52) 

Weighted average number of

common shares

      outstanding            5,462,528   5,434,616    5,461,239    5,254,455 

SOURCE Information Resource Engineering, Inc.

     -0-                             11/06/97 

/CONTACT: Roberta Thuman of Information Resource Engineering, 410-931-7583 or rthuman@ire.com/

(IREG)

CO: Information Resource Engineering, Inc. ST: Maryland IN: CPR SU: ERN

JO -- DCTH034 -- 9621 11/06/97 16:02 EST http://www.prnewswire.com