The Year Ahead
Edgewater spent 2007 focused on the Premium Services niche within Information Technology (“IT”) Services. As we continued our march up the pyramid of IT services, we decided to simplify our message to our clients by calling out three key business offerings: (1)Technical Consulting, and (2) Corporate Performance Management (“CPM”), and (3) Business Consulting.

For our Company, 2007 was a year defined by growth and change. Edgewater doubled the revenue run rate of our CPM offering. We are now one of the largest Oracle/Hyperion service providers in North America with specialties in Budgeting/Planning and Consolidation. In addition,we acquired and are growing capabilities in SAP/OutlookSoft, IBM/Cognos, and Microsoft offerings. Lastly, our 2007 acquisitions extended our services reach into the Western part of the United States.

For 2008, Edgewater will continue to execute on its successful strategy of migrating its services to the apex of the IT Services pyramid. The move to Premium Services was the right call in 2003. We have subsequently enjoyed traction and growth in the CPM/Business Intelligence (“BI”) space and preserved our premium positions in Strategy and Technology services as a result.

Macro trends such as Social Networks, Mash-ups, and the rise and challenge of Google are collectively driving the need for companies to re-invest in order to stay in the “game.”Again, as in 2003, we feel the time is right to change our services mix. Edgewater is strategically moving its offerings up market into the emerging Web Analytics, Internet Commerce 2.0 & Tools, and expanded Data Services space. We intend to be there with the skills and strategies essential for client companies to claim their place on the delivery platforms of the future.

With BI/CPM becoming a larger component of revenue, Edgewater’s customer base is nowbroader and more oriented to the Global 2000. While this is a measure of our growth, we will continue to sell and service our classic mid-market customers. I expect 2008 to be a challenging and changing experience for us and additional opportunity as well. I am determined that Edgewater will be ready for both the challenge and change and will be one of the ultimate winners in the IT Services space.

We remain focused on our core values of nurturing long-term customer relationships, fostering our employees’ professional growth, and thereby, creating long-term shareholder value. I want to extend my appreciation to the Company’s team of professionals along with our clients and stockholders for their support and commitment.

Shirley Singleton
President and Chief Executive Officer
Chairman of the Board
April, 2008