market segments, including the Fashion Apparel and Accessories, Beauty and Fragrance and Consumer Packaged Goods (CPG) segments. We continue to maintain a robust new business pipeline and hope to capitalize on this pipeline by establishing relationships with major consumer brands and companies that own families of brands.

“While the economy is still in the early stages of its recovery, we believe there is exciting potential to drive organic revenue growth through our existing client base, especially those with focused direct-to-consumer initiatives. We believe the combination of many new eCommerce clients, along with the economic recovery, has us well positioned for growth in the future.”

“I am also pleased to communicate again that during the quarter we completed the renewal of our financing facilities with IBM Global Finance, Comerica and Fortis through March 2011,” Mr. Layton continued.

Summary of results by business segment:

Service Fee Business:

For the first quarter of 2010, Service Fee revenue was $16 million, compared with $17.1 million for the same period in 2009. The Service Fee business reported Adjusted EBITDA of $0.15 million for the first quarter of 2010, compared to Adjusted EBITDA of $1.6 million for the same period last year.

Mike Willoughby, President of PFSweb’s Services division, commented, “Recently we announced a number of significant new client opportunities. This includes the launch of an End2End eCommerce solution to support the web commerce initiative for the Carter’s and OshKosh B’Gosh brands. Since its launch on March 24, 2010, the program has exceeded expectations, and PFSweb’s ability to scale its operations has helped enable Carter’s to capitalize on this opportunity. The end-to-end solution incorporates an innovative multi-brand web store, high-touch customer care, fully branded order fulfillment and comprehensive financial transaction management. PFSweb also provides a variety of Interactive Marketing Services to support Carter’s, which are targeted to fuel additional growth.

“Also, in February we launched a beta site to test the eStore, an online shopping site exclusively featuring P&G products to consumers in the U.S., which is an alliance between PFSweb and P&G. Since the beta site was launched, we have received positive feedback from P&G and the customers using the site. We believe we are nearing completion of the beta test and are getting ready for the live site launch, which we expect to happen soon.

“We have gained a significant amount of attention since initially launching the End2End solution. However, this solution really just expanded and unlocked the world-class services we have offered for years. We continue to operate a robust range of world class outsourcing services designed for both direct-to-consumer and business-to-business commerce activity. As further evidence of our service quality, our client Riverbed recently awarded PFSweb their Supplier of the Year award for 2009, in recognition of the excellence of our solutions serving their growing customer base,” continued Mr. Willoughby.

Supplies Distributors Business:

For the first quarter of 2010, Supplies Distributors revenue was $45.5 million, compared to $45.3 million for the same period last year. Adjusted EBITDA was $1.0 million for the first quarter of 2010, compared to $1.4 million for the same period last year.