PRVH - Gewinner - Tread - 2005

Press Release Source: Southridge Capital Management LLC


Southridge Capital Management LLC Managed Funds Provide Up to $10 Million Financing to Providential Holdings Inc.
Wednesday February 23, 7:00 am ET


RIDGEFIELD, Conn., Feb. 23 /PRNewswire/ -- Southridge Capital Management LLC (" Southridge" ), a private investment firm that provides investment capital to small and microcap companies, is pleased to announce a financing facility of up to $10 million between funds it advises and Providential Holdings, Inc. (OTC Bulletin Board: PRVH - News; www.phiglobal.com)
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Providential Holdings is provider of international management advisory services to companies that are located or operate in the Pacific Rim. As a fee, the Company takes a minority ownership interest in the partner-client company and can earn substantial profits if the portfolio company is successful in its operations. In addition, the company manufactures, in North America, cutting tools used in printed circuit boards and wireless communications equipment sold worldwide.

Henry Fahman, Chief Executive Officer of Providential Holdings, stated " we are pleased to have partnered with Southridge in this financing. We searched for an experienced, institutional partner who can meet every challenge and be there every step of the way with us. We plan to leverage our expertise in Asia, and we view this Facility as a valuable tool in meeting our objectives."

" We are excited about our relationship with Providential Holdings. We look to be a steady source of growth capital for a wide variety of needs including working capital, acquisitions and other requirements," said Stephen Hicks, Founding Principal at Southridge.

About Southridge:

Since its founding in 1996, Southridge advised funds have provided in excess of $1 billion in growth capital to emerging companies. Southridge is committed to funding companies with robust business models domestically and abroad.




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Source: Southridge Capital Management LLC

Total general and administrative expenses were $5,126,204 and $4,316,784 for the three months ended December 31, 2004 and 2003, respectively. The increase is primarily due to the impairment of assets in the amount of $4,708,159. Interest expense was $313,026 and $103,256 for the three months ended December 31, 2004 and 2003, respectively.

Net loss for the three months ended December 31, 2004 was $4,790,076, compared to a net loss of $3,961,534 for the same period in 2003, which is equivalent to a net loss per share of $0.04 and $0.04, respectively, based on the weighted average number of basic and diluted shares outstanding of 135,974,402 and 89,323,367, respectively. The net loss is primarily attributed to conservative accounting treatments resulting in impaired assets of $4,708,159 and a one-time reduction of 50% applied to the advisory and consulting fees during the most recent quarter. Without the impairment and the one-time haircut, the Company would have recorded $1,307,458 in gross profit and $564,506 in net profit for the second quarter of fiscal 2005.

Henry Fahman, chief executive officer of Providential Holdings, stated, "We consider it prudent to take a conservative stance now, which may turn out to be a pleasant surprise down the road when the related assets are re-evaluated. Fundamentally, the growth opportunity of the Company is very strong. Our advisory services continue to generate consistent revenues for the Company. In the current period, we have gained two new clients for consulting services and have very healthy deal flows moving forward."

Fahman continued, "Providential Holdings has built a strong operational platform, which will provide the Company with a solid base on which to continue our prudent merger and acquisition activities. We believe the transactions we have been working on recently will help us increase shareholder value in the near future."

About Providential Holdings, Inc.

Providential Holdings and its subsidiaries engage in a number of diverse business activities, the most important of which are M&A advisory services, cutting tools, and international markets. The Company acquires and consolidates special opportunities in selective high-growth industries to create additional value, acts as an incubator for emerging companies and technologies, and provides financial consultancy and M&A advisory services to U.S. and foreign companies. For more information on Providential Holdings and its subsidiaries visit www.phiglobal.com

This news release contains forward-looking statements that are subject to certain risks and uncertainties that may cause actual results to differ materially from those projected on the basis of such forward-looking statements. Such forward-looking statements are made based upon management's beliefs, as well as assumptions made by, and information currently available to, management pursuant to the "safe-harbor" provisions of the Private Securities Litigation Reform Act of 1995.

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On March 1, 2004, Investrend Research analyst Mohammad Sharifzadeh, MBA, CFA,
rated the company a " Speculative Buy / 4," saying the company had
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Total general and administrative expenses were $5,126,204 and $4,316,784 for the three months ended December 31, 2004 and 2003, respectively. The increase is primarily due to the impairment of assets in the amount of $4,708,159. Interest expense was $313,026 and $103,256 for the three months ended December 31, 2004 and 2003, respectively.

Net loss for the three months ended December 31, 2004 was $4,790,076, compared to a net loss of $3,961,534 for the same period in 2003, which is equivalent to a net loss per share of $0.04 and $0.04, respectively, based on the weighted average number of basic and diluted shares outstanding of 135,974,402 and 89,323,367, respectively. The net loss is primarily attributed to conservative accounting treatments resulting in impaired assets of $4,708,159 and a one-time reduction of 50% applied to the advisory and consulting fees during the most recent quarter. Without the impairment and the one-time haircut, the Company would have recorded $1,307,458 in gross profit and $564,506 in net profit for the second quarter of fiscal 2005.

Henry Fahman, chief executive officer of Providential Holdings, stated, "We consider it prudent to take a conservative stance now, which may turn out to be a pleasant surprise down the road when the related assets are re-evaluated. Fundamentally, the growth opportunity of the Company is very strong. Our advisory services continue to generate consistent revenues for the Company. In the current period, we have gained two new clients for consulting services and have very healthy deal flows moving forward."

Fahman continued, "Providential Holdings has built a strong operational platform, which will provide the Company with a solid base on which to continue our prudent merger and acquisition activities. We believe the transactions we have been working on recently will help us increase shareholder value in the near future."