LENEXA, Kan., May 13 /PRNewswire-FirstCall/ -- ICOP Digital, Inc. ( NASDAQ: ICOP ) , an industry-leading company engaged in advancing digital surveillance solutions, today announced its operational and financial results for the three months ended March 31, 2008.

  First Quarter 2008 Key Operational Highlights

  -- ICOP shipped ICOP Model 20/20(R)-W units to law enforcement agencies in
     37 states; sales activity was most pronounced in Arkansas, Georgia,
     Illinois, Minnesota, North Carolina, South Carolina and Wyoming.

  -- Reorders from existing customers engaged in full fleet deployments of
     the ICOP Model 20/20-W rose to 67% in the first three months of 2008
     from 46% in the first three months of 2007.

  -- The Company has responded to 21 RFP's from law enforcement agencies
     seeking competitive bids for equipping their patrol fleets with high
     quality digital in-car video systems.  Of the 16 awarded to date, ICOP
     has won nine of them; four are still pending.

  -- The Company launched a nationwide beta test of its ICOP LIVE(TM)
     wireless audio and video streaming solution in collaboration with a law
     enforcement agency serving a mid-sized U.S. city and several first
     responder agencies serving several smaller U.S. communities.  The beta
     test was conducted to affirm ICOP LIVE's functionality and user
     compatibility in real world applications of the technology.  As a
     result of the test, ICOP LIVE has successfully demonstrated how law
     enforcement can leverage the technology to gain real time insight into
     local gang activity and other covert surveillance operations; to
     provide real-time surveillance of remote areas or of sites where
     suspicious activity has been reported; and to quickly escalate response
     to routine traffic stops or domestic disputes that have turned
     problematic, among other applications.

  -- The Company commenced shipping the ICOP Extreme(TM) Wireless Mic to law
     enforcement agencies nationwide.  The ICOP Extreme is a 900-MHz
     wireless microphone that records high quality audio at a range of over
     2,000 feet (line of sight), representing an industry best.  The
     industry standard wireless microphone delivers very poor quality audio,
     at very short range from the police vehicle.

Financial highlights for the three months ended March 31, 2008 compared to the three months ended March 31, 2007:

  -- Revenues increased to $2.8 million, a 21.7% over $2.3 million.

  -- Adjusted EBITDA (see definition and reconciliation of Adjusted EBITDA
     below) decreased 39.9% to $(1.1) million, when compared to Adjusted
     EBITDA of approximately ($750,000.)

  -- Net loss increased 30.2% to $1.3 million, or $0.17 loss per basic and
     diluted share, from approximately $990,000, or $0.14 loss per basic and
     diluted share.

As of March 31, 2008, the Company had $1.7 million in cash; accounts receivables of $2.7 million; $5.0 million in inventory and working capital of $7.0 million. Total shareholders' equity was $9.4 million.

Adjusted EBITDA is defined as operating loss excluding depreciation and amortization and stock-based compensation expenses. While depreciation and amortization are considered operating costs under U.S. GAAP, these expenses primarily represent a non-cash current period allocation of costs associated with long-lived assets acquired in prior periods. Similarly, the expense recorded for stock-based compensation does not represent a current or future period cash cost.

Management believes that Adjusted EBITDA is an important measure of operating performance, leverage capacity, its ability to service its debt, and its ability to make capital expenditures for its stockholders. These calculations are commonly used as a basis for investors, analysts and credit rating agencies to evaluate and compare the operating performance and value of companies within the digital surveillance industry.

Management believes the use of this non-U.S. GAAP measure provides a useful basis for evaluating underlying business unit performance, but should not be considered in isolation and is not a substitute for evaluating business unit performance utilizing U.S. GAAP financial information. Management uses non-U.S. GAAP measures in its budgeting and forecasting processes and to further analyze its financial trends and "operational run-rate," as well as making financial comparisons to prior periods presented on a similar basis. The Company believes that providing such adjusted results allows investors and other users of ICOP's financial statements to better understand ICOP's recurring comparative operating performance for the periods presented.

ICOP's management uses non-U.S. GAAP financial measures, such as Adjusted EBITDA, in its own evaluation of the Company's performance, particularly when comparing performance to past periods. ICOP's non-U.S. GAAP measures may differ from similar measures by other companies, even if similar terms are used to identify such measures. Although ICOP's management believes non-U.S. GAAP measures are useful in evaluating the performance of its business, ICOP acknowledges that items excluded from such measures may have a material impact on the Company's income from operations, pretax income, net income and earnings per share calculated in accordance with U.S.GAAP. Therefore, management typically uses non-U.S. GAAP measures in conjunction with U.S. GAAP results. Investors and users of our financial information should also consider the above factors when evaluating ICOP's results.

The attached schedule provides a full reconciliation of this non-U.S. GAAP financial measure to the most directly comparable corresponding U.S. GAAP financial measure.

                             CHARTS TO FOLLOW



                            ICOP DIGITAL, INC.
                         Condensed Balance Sheet

                                  March 31, 2008      December 31, 2007
             Assets                (unaudited)

  Current Assets
    Cash                          $    1,677,691      $    3,166,213
    Accounts receivable, net of
     allowance for doubtful
     accounts of $114,000 at
     March 31, 2008 and
     December 31, 2007                 2,712,587           2,915,897
    Inventory, at cost                 5,068,278           4,143,781
    Prepaid expenses                     397,236             502,320
       Total current assets            9,855,792          10,728,211

  Property and equipment, at cost,
   net of accumulated depreciation
   of $818,220 at March 31, 2008
   and $706,819 at December 31, 2007   2,320,988           1,359,630
  Other Assets:
    Investment, at cost                   25,000              25,000
    Deferred patent costs                 87,621              87,621
    Deposits                              18,258              18,258
  Total Assets                    $   12,307,659      $   12,218,720

  Liabilities and Shareholders' Equity

  Current Liabilities:
    Accounts payable                $    407,578        $    735,382
    Accrued liabilities                  709,210             553,105
    Line of credit                       650,000                   -
    Notes payable                        780,000                   -
    Unearned revenue                     356,074             359,937
      Total current
       liabilities                     2,902,862           1,648,424
    Shareholders' Equity:
      Preferred stock, no par
       value; 5,000,000 shares
       authorized, no shares
       issued and outstanding                  -                   -
  Common stock, no par value;
   50,000,000 shares authorized,
   issued and outstanding
   7,462,937 shares at
   March 31, 2008 and
   7,455,054 at
   December 31, 2007                  29,841,472          29,710,064
  Accumulated other
   comprehensive (loss) gain                  (2)              7,729
  Accumulated deficit                (20,436,673)        (19,147,497)
      Total Shareholders'
       Equity                          9,404,797          10,570,296
  Total Liabilities and
   Shareholders' Equity             $ 12,307,659        $ 12,218,720



                            ICOP DIGITAL, INC.
                    Condensed Statements of Operations
                               (unaudited)

                                               Three Months
                                                  Ended
                                                 March 31,
                                          2008              2007

  Sales, net of returns          $    2,815,323      $    2,272,168
  Cost of sales                       1,789,414           1,246,181

      Gross profit                    1,025,909           1,025,987

  Operating expenses:
    Selling, general and
     administrative                   2,070,238           1,624,048
    Research and development            246,355             458,951

      Total operating expenses        2,316,593           2,082,999

      Loss from operations           (1,290,684)         (1,057,012)

  Other income (expenses):
    Foreign currency translation              -               8,331
    Loss on disposal of property and
     equipment                           (5,283)                  -
    Interest income                      17,188              67,118
    Interest expense                    (10,397)             (8,336)

      Loss before income taxes       (1,289,176)           (989,899)

 Income tax provision                         -                   -

      Net loss                  $    (1,289,176)     $     (989,899)

  Basic and diluted loss
   per share                    $         (0.17)     $        (0.14)

  Basic and diluted weighted
   average common shares
   outstanding                        7,460,134           7,232,869



                            ICOP DIGITAL, INC.
           Reconciliation of Operating Loss to Adjusted EBITDA
                               (unaudited)

                                               Three Months
                                                  Ended
                                                 March 31,
                                          2008              2007

  Operating Loss                $    (1,290,684)     $  (1,057,012)

    Add:  Depreciation and
     amortization                       127,825             71,107
    Add:  Share-based
     compensation                       105,000            234,600

  Earnings before interest, taxes,
   depreciation, amortization
   and share-based compensation
   (Adjusted EBITDA)            $    (1,057,859)     $    (751,305)


  About ICOP Digital, Inc.

ICOP Digital, Inc. ( NASDAQ:ICOP ) operates on the core principle that 'without local security, there is no national security.' It endeavors to protect people, assets and profits for communities with innovative, mission-critical security, surveillance and communication solutions. The Company engineers, manufactures and markets mobile and stationary surveillance products for use in the public and private sectors, and facilitates the delivery of live video to first responders. (GSA Contractor)

The ICOP Model 20/20(R)-W, ICOP's flagship, award-winning product, is the leading digital in-car video recorder system for law enforcement. ICOP LIVE(TM) delivers live streaming video to and from first responder vehicles and headquarters, empowering first responders with enhanced real-time situational awareness and actionable intelligence, optimizing the outcome of a crisis. ICOP LIVE delivers live video wirelessly to first responders over any wireless network and to multiple internet enabled Windows(R) devices simultaneously. The ICOP Model 4000(TM), ICOP's newest advanced surveillance solution, is the next generation transit/rail DVR system. The ICOP Model 4000 uses less power than traditional DVR's, which means less heat and translates into a more reliable unit with less downtime. In addition, the ICOP Model 4000 boasts many advanced and innovative features and capabilities, such as wireless file uploading and wireless video streaming, among many others.

For more information, please view the following video presentations at http://www.icopdigital.com/why_icop.html and www.ICOP.com/veil.html , or visit www.ICOP.com .

Source: ICOP Digital, Inc.