Paradigm Holdings Inc. reported unaudited consolidated earnings results for the third quarter ended September 30, 2009. For the quarter, the company's revenue was $8,036,928 compared to $9,564,459 for the third quarter of 2008. The decline in revenue for the three months is attributable to a decrease in federal repair and maintenance services and the completion of certain small business set-aside programs during 2008. Net income attributable to common shareholders was $957,679 or $0.01 loss per diluted share against a net loss attributable to common shareholders of $269,147 or $0.01 per basic and diluted share in the third quarter of 2008. The increase in net income for the three months is attributable to the gain from the changes in the fair value of put warrants and the lower SG&A expenses which are partially offset by the decrease in revenue and an increase in interest expense. The company reported income from operations of $165,781 and income from operations before income taxes of $1,092,748 compared to loss from operations of $98,817 and income from operations before income taxes of $329,410 for the same period a year ago. EBITDA was $367,071 compared to $251,449 reported a year ago. Disciplined cash management enabled the company to generate positive operating cash flow during the quarter and reduce debt balance to $3.1 million. For the nine months, the company reported loss from operations of $306,688, loss from operations before income taxes of $1,229,293 and net loss attributable to common shareholders of $1,219,539 or $0.03 per diluted share on total contract revenue of $24,416,024 compared to loss from operations of $149,168, loss from operations before income taxes of $882,818 and net loss attributable to common shareholders of $762,313 or $0.04 per diluted share on total contract revenue of $30,982,137 for the same period a year ago. EBITDA was $857,410 compared to $1,171,956 reported a year ago.

Paradigm Holdings Inc. announced that the Internal Revenue Service has awarded the company a prime contract to provide preventative and remedial maintenance and technical support services for Government-owned high speed printers and peripheral equipment. The firm fixed price contract covers a one-year base period and four one-year options. If all option years of the contract are exercised, the estimated potential value of the contract will be $15.3 million. The contract supports the IRS Wage & Investment Division which operates a number of sophisticated large scale, high-speed print systems and peripherals in several locations across the United States to produce correspondence and internal reports in bulk. Under the terms of the new agreement, Paradigm will provide supervision, labor, and materials in support of preventative and remedial maintenance services for the equipment.

Paradigm Holdings Inc. announced that the Internal Revenue Service (IRS) has awarded the company a prime contract to provide preventative and remedial maintenance and technical support services for Government-owned high speed printers and peripheral equipment. The firm fixed price contract covers a one-year base period and four one-year options. If all option years of the contract are exercised, the estimated potential value of the contract will be $15.3 million. The contract supports the IRS Wage & Investment Division which operates a number of sophisticated large scale, high-speed print systems and peripherals in several locations across the United States to produce correspondence and internal reports in bulk. Under the terms of the new agreement, Paradigm will provide supervision, labor, and materials in support of preventative and remedial maintenance services for the equipment. Under separate contracts, the Company currently provides technical services to another component of the IRS as well as IT support services to the Office of the Comptroller of the Currency (OCC).