8-K

United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  May 5, 2008 (May 7, 2008)

ePlus inc.

(Exact name of registrant as specified in its charter)

Delaware	000-28926	54-1817218
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

13595 Dulles Technology Drive, Herndon, VA20171-3413

(Address, including zip code, of principal executive offices)

Registrant's telephone number, including area code: (703) 984-8400

Check  the  appropriate  box  below  if the  Form  8-K  filing  is  intended  to simultaneously  satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):              

 [   ]   Written communications pursuant to Rule 425  under  the  Securities  Act (17 CFR 230.425)                

 [   ]   Soliciting  material  pursuant to Rule  14a-12  under  the  Exchange Act (17 CFR 240.14a-12)

 [   ]   Pre-commencement  communications pursuant  to Rule  14d-2(b)  under  the Exchange Act (17 CFR 240.14d-2(b))

 [   ]   Pre-commencement  communications  pursuant to  Rule 13e-4(c)  under  the Exchange Act (17 CFR 240.13e-4(c))

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Item 2.02  Results of Operations and Financial Condition

On May 5, 2008, ePlus inc. announced by press release its results of operations for the quarter ended December 31, 2007.  A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

In accordance with General Instruction B.2 of Form 8-K, the information in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01  Financial Statements and Exhibits

(d)   Exhibits:

Exhibit No.                              Description

99.1    Press release dated May 5, 2008 issued by ePlus inc.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ePlus inc.
	By: /s/ Steven J. Mencarini
	Steven J. Mencarini
Date: May 7, 2008	Chief Financial Officer

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EX-99.1

ePlus Reports December 31, 2007 Quarter Results:

Revenues Decreased 11.0% to $198.4 Million;

Net Earnings Decresed 69.8% to $3.8 Million

HERNDON, VA – May 5, 2008– ePlus inc. (OTC: PLUS - news), today announced financial results for its third quarter of fiscal year 2008, which ended December 31, 2007 (“the Quarter”).  Revenues for the Quarter decreased 11.0% to $198.4 million as compared to revenues of $222.9 million during the three months ended December 31, 2006 (“the Prior Year’s Quarter”).  Net earnings for the Quarter decreased 69.8% to $3.8 million from $12.4 million the Prior Year’s Quarter.  As disclosed in the Company’s Form 10-Q for the period ended December 31, 2006, the Prior Year’s Quarter included patent settlement income of $17.5 million and related expenses of $5.8 million.  Excluding the patent settlement income, total revenues decreased 3.4% in the Quarter as compared to the Prior Year’s Quarter.

With the filing on May 2, 2008 of the Company’s Form 10-Q for the quarter ended December 31, 2007, the Company believes it is now current in its quarterly and annual report filing requirements of the Securities Exchange Act of 1934 and the related SEC rules.

Both basic and fully diluted earnings per common share were $0.45 for the Quarter, as compared to $1.51 and $1.47, respectively, for the Prior Year’s Quarter.  Basic and diluted weighted average common shares outstanding for the Quarter are 8,231,741 and 8,422,256, respectively, as compared to 8,231,741 and 8,456,627, respectively, for the Prior Year’s Quarter.

For the nine months ended December 31, 2007 as compared to the nine months ended December 31, 2006, total revenues increased 8.3% to $662.1 million from $611.1 million; net earnings decreased 11.9% to $13.6 million from $15.5 million; and fully diluted earnings per share declined 9.4% to $1.63 from $1.80.

For the Quarter, sales of product and services decreased 8.1% to $168.4 million as compared to $183.3 million generated the Prior Year’s Quarter, and represented 84.9% and 82.2% of total revenue, respectively.  The cost of sales, product and services decreased 7.7% to $148.8 million as compared to $161.3 million the Prior Year’s Quarter.  The gross margin on sales of product and services was 11.6% in the Quarter as compared to 12.0% the Prior Year’s Quarter.

Lease revenues decreased 23.8% to $12.2 million in the Quarter, and sale of leased equipment totaled approximately $13.7 million as compared to $2.6 million the Prior Year’s Quarter.  The net investment in leased assets was $161.1 million as of December 31, 2007, a 25.8% decrease from $217.0 million as of December 31, 2006.  This decrease was due to a reduction in our direct financing lease portfolio resulting from the sale of lease schedules and termination of leases in our operating lease portfolio.  Direct lease costs decreased 20.0% to $4.5 million in the Quarter.

For the Quarter, fee and other income was $4.1 million, an increase of 16.0% over the $3.5 million the Prior Year’s Quarter, due to an increase in agent fees from manufacturers and an increase in revenue from sales of ePlus software in the technology sales business unit.

There was no patent settlement income during the Quarter or nine months ended December 31, 2007.  During the three and nine months ended December 31, 2006, patent settlement income was $17.5 million.

Professional and other fees decreased 65.8% to $2.5 million for the Quarter, due to higher expenses incurred in the Prior Year’s Quarter related to a lawsuit against SAP and expenses related to the Audit Committee’s review of the Company’s historical stock option grants, as previously disclosed in the Company’s Form 10-K for the fiscal year ended March 31, 2007.

Salaries and benefits expenses decreased 4.9% to $17.1 million  during the Quarter, driven by a reduction in the number of employees and lower sales commission expense resulting from a decrease in the revenue.  The Company employed 649 people at December 31, 2007  as compared to 682 people at December 31, 2006.   General and administrative expenses decreased 7.2% to $3.8 million during the Quarter, due to increased efficiency in spending controls and efforts to enhance productivity.

Interest and financing costs decreased 36.0% to $1.8 million during the Quarter, which resulted from decreases in recourse and non-recourse notes payable, the total of which decreased 38.1% to $104.7 million as of December 31, 2007 as compared to December 31, 2006.  

The Company’s cash and cash equivalents balance as of December 31, 2007 was $65.6 million, as compared to $39.7 million as of March 31, 2007.

The financial results presented herein are unaudited.  Investors are encouraged to review the Company’s Form 10-Q and to review other SEC filings including the Company’s audited financial statements contained in the fiscal year 2007 Form 10-K.

About ePlus inc.

ePlus is a leading provider of technology solutions.  ePlus enables organizations to optimize their IT infrastructure and supply chain processes by delivering world-class IT products from top manufacturers, professional services, flexible lease financing, proprietary software, and patented business methods.  Founded in 1990, ePlus has approximately 650 associates in 30+ offices serving more than 2,500 customers.  The Company is headquartered in Herndon, VA.   For more information, visit http://www.eplus.com/, call 888-482-1122, or email info@eplus.com.

ePlus® and/or other ePlus products referenced herein are either registered trademarks or trademarks of ePlus inc.

Note:  Statements in this press release, which are not historical facts, may be deemed to be "forward-looking statements."  Actual and anticipated future results may vary due to certain risks and uncertainties, including, without limitation, the effects of the delisting of the Company’s common stock from The Nasdaq Global Market and the quotation of the Company’s common stock in the “Pink Sheets,” including any adverse effects relating to the trading of the stock due to, among other things, the absence of market makers; the timing of our ability to list our shares of common stock for trading on The Nasdaq Global Market; the effects of any lawsuits or governmental investigations alleging, among other things, violations of federal securities laws, by the Company or any of its directors or executive officers; the existence of demand for, and acceptance of, our services; our ability to hire and retain sufficient personnel; our ability to protect our intellectual property; the creditworthiness of our customers; a decrease in the capital spending budgets of our customers; our ability to raise capital and obtain non-recourse financing for our transactions; our ability to realize our investment in leased equipment; our ability to reserve adequately for credit losses; fluctuations in our operating results; and other risks or uncertainties detailed in our SEC filings.

All information set forth in this release and its attachments is as of May 5, 2008.  ePlus inc. undertakes no duty to update this information.  More information about potential factors that could affect ePlus inc.’s business and financial results is included in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2007 under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” which is on file with the SEC and available at the SEC’s website at http://www.sec.gov/.

ePlus inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)	Asof			Asof
(in thousands, except for share amounts)	December 31,			March31,
	2007			2007
ASSETS
Cash and cash equivalents	$	65,590		$	39,680
Accounts receivable– net		108,457			110,662
Notes receivable		186			237
Inventories		8,717			6,851
Investment in leases and leased equipment - net		161,074			217,170
Property and equipment - net		5,007			5,529
Other assets		15,011			11,876
Goodwill		26,125			26,125
TOTAL ASSETS	$	390,167		$	418,130
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable - equipment	$	6,482		$	6,547
Accounts payable - trade		26,980			21,779
Accounts payable - floor plan		51,618			55,470
Salaries and commissions payable		4,491			4,331
Accrued expenses and other liabilities		26,674			25,960
Income taxes payable		3,531			-
Recourse notes payable		-			5,000
Nonrecourse notes payable		104,741			148,136
Deferred tax liability		4,457			4,708
Total Liabilities		228,974			271,931
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Preferred stock, $.01 par value; 2,000,000 shares authorized;
none issued or outstanding		-			-
Common stock, $.01 par value; 25,000,000 shares authorized;
11,210,731 issued and 8,231,741 outstanding at March 31, 2007
and 11,210,731 issued and 8,231,741 outstanding at December 31, 2007	$	112		$	112
Additional paid-in capital		77,471			75,909
Treasury stock, at cost, 2,978,990 and 2,978,990 shares, respectively		(32,884	)		(32,884	)
Retained earnings		115,878			102,754
Accumulated other comprehensive income -		-			-
Foreign currency translation adjustment		616			308
Total Stockholders' Equity		161,193			146,199
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	390,167		$	418,130

ePlus inc. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except share amounts)
	Three Months Ended				Nine Months Ended
	December 31,				December 31,
	2007		2006		2007		2006
REVENUES
Sales of product and services	$	168,394	$	183,277	$	564,628	$	538,923
Sales of leased equipment		13,740		2,557		40,544		4,376
		182,134		185,834		605,172		543,299
Lease revenues		12,194		16,000		43,810		40,853
Fee and other income		4,111		3,544		13,124		9,484
Patent Settlement Income		-		17,500		-		17,500
TOTAL REVENUES		198,439		222,878		662,106		611,136
COSTS AND EXPENSES
Cost of sales, product and services		148,802		161,254		500,202		477,879
Cost of sales, leased equipment		13,308		2,509		38,919		4,284
		162,110		163,763		539,121		482,163
Direct lease costs		4,460		5,574		16,353		16,170
Professional and other fees		2,479		7,245		9,650		13,295
Salaries and benefits		17,069		17,947		53,971		52,912
General and administrative expenses		3,760		4,050		12,135		12,921
Interest and financing costs		1,818		2,839		6,590		7,492
TOTAL COSTS AND EXPENSES		191,696		201,418		637,820		584,953
EARNINGS BEFORE PROVISION FOR INCOME TAXES		6,743		21,460		24,286		26,183
PROVISION FOR INCOME TAXES		2,992		9,056		10,671		10,737
NET EARNINGS	$	3,751	$	12,404	$	13,615	$	15,446
NET EARNINGS PER COMMON SHARE - BASIC	$	0.45	$	1.51	$	1.65	$	1.88
NET EARNINGS PER COMMON SHARE - DILUTED	$	0.45	$	1.47	$	1.63	$	1.80
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC		8,231,741		8,231,741		8,231,741		8,222,700
WEIGHTED AVERAGE SHARES OUTSTANDING - DILUTED		8,422,256		8,456,627		8,375,412		8,577,999

Contact:	Kley Parkhurst, SVP
	ePlus inc.
	kparkhurst@eplus.com
	703-984-8150