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ORBIT/FR, Inc. News

ORBIT/FR Reports Q1 Results

HORSHAM, Pa., May 20 PRNewswire-FirstCall — ORBIT/FR, Inc. (OTC Bulletin Board: ORFR), a leading producer of sophisticated, automated microwave test and measurement systems for the aerospace/defense, wireless communication, automotive, and satellite industries, today reported results for the three months ended March 31, 2008.

The Company's revenues for the three months ended March 31, 2008 decreased approximately 7.0% to $6.05 million, from $6.5 million for the three months ended March 31, 2007, and decreased approximately 17% from $7.3 million for the three months ended December 31, 2007. The Company's gross margin for the three month period ended March 31, 2008 was 16.1% compared to 34% for the three month period ended March 31, 2007 and 31.8% for the three month period ended December 31, 2007. The lower margin percentage in 2008 is largely a result of contracts mix with lower margins. In addition, the Company charged cost of revenues approximately $317,000 for costs in inventory that were incurred for a contract with a customer in the Far East that was cancelled. In 2004, the Israeli Ministry of Defense (IMOD) implemented a policy suspending the export of all Israeli military and commercial use products to certain Far East countries. To date, the Company's discussions with the IMOD for reimbursement have been not been successful. The Company's operating loss for the three months ended March 31, 2008 was $1,145,000, compared to operating income of $130,000 for the three months ended March 31, 2007, and $310,000 for the three months ended December 31, 2007. The Company's net loss for the three months ended March 31, 2008 was $1,093,000 (or $0.18 per basic and diluted common share), compared to a net income of $142,000 (or $0.02 per basic and diluted common share) recognized during the three months ended March 31, 2007, and compared to net income of $477,000 (or $0.08 per basic and diluted common share) for the three months ended December 31, 2007.

Except for historical information, the matters discussed in this news release may be considered "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements include declarations regarding the current intent, belief or expectations of the Company and its management. Prospective investors are cautioned that any such forward-looking statements, including those regarding the ability to obtain new contracts, and future profitability involve a number of risks and uncertainties that could materially affect actual results. Such risks and uncertainties are identified in the Company's reports and registration statements filed with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2007 and Forms 10- Q. This press release, and all SEC filings are available at www.orbitfr.com

ORBIT/FR, Inc. UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS (Amounts in thousands, except share and per share data) Three months ended March 31, December 31, 2008 2007 2007 Contract revenues $6,049 $6,514 $7,272 Cost of revenues 5,077 4,293 4,955 Gross profit 972 2,221 2,317 Operating expenses: General and administrative 814 897 612 Sales and marketing 829 817 959 Research and development 474 377 436 Total operating expenses 2,117 2,091 2,007 Operating (loss) income (1,145) 130 310 Impairment of costs in excess of net assets acquired — — (80) Other (loss) income, net (46) 85 16 (Loss) income before income taxes (1,191) 215 246 Income tax (benefit) expense (98) 73 (231) Net (loss) income $(1,093) $142 $477 Basic and diluted net (loss) income per share $(0.18) $0.02 $0.08 Weighted average number common shares basic 6,001,573 6,001,573 6,001,573 diluted 6,090,265 6,027,691 6,029,143 March 31, December 31, Selected Financial Data (amounts in thousands) 2008 2007 Cash and cash equivalents $1,606 $2,214 Working capital 4,504 6,444 Total assets 15,827 17,370 Total liabilities, all current 7,793 8,297 Stockholders' equity 8,034 9,073

SOURCE ORBIT/FR, Inc.

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