Halifax Announces First Quarter Financial Results
Net Income Increases Over Prior Year

ALEXANDRIA, VA – August 6, 2008 – Halifax Corporation (AMEX:HX) today announced its financial results for the quarter ended June 30, 2008.

Revenues for the first quarter of fiscal 2009 were $9.0 million compared to $12.5 million for the same quarter last year. The decrease in revenues was attributable to the termination of certain large nationwide enterprise maintenance contracts, including the loss of a large aeronautical manufacturing customer.

Gross Profit margin for this year’s first quarter was $1.51 million, or 17% of revenues, versus $1.48 million, or 12% of revenues, for the same period a year ago. The margin improvement was attributable to a more profitable sales mix coupled with an aggressive cost containment program.

The Company reported net income of $203,000, or $0.06 per basic and diluted share as compared to $135,000, or $0.04 per basic and diluted share for the first quarter of last year.

Charles McNew, President and Chief Executive Officer, stated, “We are pleased with our improving profitability profile.  We have worked diligently to drive our costs down by utilization of a variable workforce model and by taking actions to move away from business that is dependent on major inventory investment and parts risk.”

“Our cash flow is improving, we have a new long-term financing in place and our borrowing levels remain low by historical standards.”

“We are confident that our new service model, which has positioned the Company as a leader in global supply chain solutions for the middle market, is presenting a significant opportunity for a return to market share expansion.”

“In addition, we continue to develop a robust pipeline of new business opportunities for both  Enterprise Logistics Services and Field Maintenance Solutions.”

The Company will host a conference call for investors at 11 a.m. EDT on Wednesday, August 6, 2008, to review the financial and operational results for the quarter.  The conference call phone number is 800-768-5901 for U.S. callers and 212-231-2906 for international callers.  The conference call replay will be available from 1 p.m. EDT on Wednesday, August 6, 2008, to 1 p.m. EDT on Thursday, August 7, 2008.  The replay number is 800-633-8284 for U.S. callers and 402-977-9140 for international callers.  The reservation number is 21390175.

Founded in 1967, Halifax Corporation is an enterprise 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 high availability hardware maintenance services, technology deployment and integration services.  More information on Halifax can be found at www.hxcorp.com.  This web site reference is intended to be an inactive textual reference, and the information on this web site is not incorporated into this document.