Halifax Announces Third Quarter Financial Results

Net Income Grows for Third Consecutive Quarter

ALEXANDRIA, VA – February 17, 2009 – Halifax Corporation of Virginia (NYSE Alternext US: HX) today announced its financial results for the quarter ended December 31, 2008.

Revenues for the third quarter of fiscal 2009 were $8.1 million versus $10.4 million for the same period in fiscal 2008. The revenue decline was primarily attributable to the termination of certain large nationwide enterprise maintenance contracts, including the loss of a large aeronautical manufacturing customer during fiscal 2008.

Gross profit margin for the year’s third quarter was $1.3 million, or 16% of revenues, compared to $299,000, or 3% of revenues for the same period a year ago. Operating income was $318,000 for the quarter ended December 31, 2008 compared to an operating loss of $1.7 million for the same period the prior year.

The Company reported net income of $232,000, or $0.07 basic and diluted per share for the quarter ended December 31, 2008, compared to a net loss of $1.8 million, or $(0.58) basic and diluted per share, for the quarter ended December 31, 2007.

Charles McNew, President and Chief Executive Officer, stated, “Once again our profitability profile continues to improve. We have worked diligently to drive down our costs of service delivery, which combined with the mix of new business is generating growing margins.

Working capital is growing and as a result of positive cash flow, our bank debt levels continue to decline.

As previously indicated, while the economic environment remains difficult and uncertain, we believe our new service model has positioned the Company as a leader in global supply chain solutions for the middle market and will generate a viable means for our Company to return to market share expansion and long term growth.”

For the nine months ended December 31, 2008 revenues were $26.0 million compared to $34.8 million for the same period last year. The gross profit margin was $4.2 million, or 16% of revenues for the first nine months of the current year compared to $3.3 million or 10% of revenues for the first nine months of last year. Operating income was $982,000 for the first nine months of fiscal 2009 versus an operating loss of $961,000 for the same period a year ago. Net income for the nine months ended December 31, 2008 was $662,000, or $0.21 basic and diluted per share, versus a loss of $1.5 million, or $(0.47) basic and diluted per share for the same period last year.

The Company will host a conference call for investors at 2 p.m. EST on Tuesday, February 17, 2009, to review the financial and operational results for the quarter. The conference call phone number is 800-925-3017 for U.S. callers and 212-231-2906 for international callers. The conference call replay will be available from 4 p.m. EST on Tuesday, February 17, 2009, to 4 p.m. EST on Wednesday, February 18, 2009. The replay number is 800-633-8284 for U.S. callers and 402-977-9140 for international callers. The reservation number is 21414895.

Founded in 1967, Halifax Corporation of Virginia is an enterprise logistics and maintenance solutions company providing a wide range of technology services to commercial and government customers throughout the United States. The Company’s principal products are enterprise logistics solutions and high availability hardware maintenance services. More information on Halifax can be found at www.hxcorp.com.