HALIFAX ANNOUNCES FIRST QUARTER FINANCIAL RESULTS

Company Reports Growth in Gross Profit Margin and Net Income

Alexandria, VA - August 15, 2007 – Halifax Corporation (AMEX: HX) today announced its financial results for the quarter ended June 30, 2007.

The Company reported revenues of $12.5 million compared to $12.7 million for the first quarter of fiscal 2007.  The slight decrease in revenue was primarily due to the elimination of certain under-performing contracts, which was partially offset by newly awarded, and more profitable, business.

Halifax reported a gross margin of $1.5 million, or 11.9%, for the current quarter versus $1.5 million, or 11.6%, for the same period in the prior year.  According to the Company, margins are continuing to show positive progress, reflecting the improvement in the mix of business.

Operating income was $321,000 for the first quarter of fiscal 2007 compared to $326,000 for the first quarter of fiscal 2007.

The Company reported net income of $135,000, or $ 0.04 per basic and diluted share, for the current quarter compared to $84,000, or $ 0.03 per basic and diluted share, for the first quarter of fiscal 2007.

According to Charles McNew, president and chief executive officer, “Our profitability trend is encouraging.  We are continuing to take aggressive steps to grow the top line, and our cost containment and system improvement actions are helping to generate the desired results.  Despite a competitive marketplace, we are encouraged by the present volume of potential new deals on the horizon.”

McNew added, “We are driving to enhance shareholder value and are continuing to evaluate various strategic alternatives to further position our Company for near and longer term growth opportunities.”

The Company will host a conference call for investors at 11:00 a.m. EDT on Wednesday, August 15, 2007, to review the financial and operational results for the quarter.  The conference call phone number is 800-266-2145 for U.S. callers and 212-676-4904 for international callers.  The conference call replay will be available from 1 p.m. EDT on Wednesday, August 15, 2007, to 1 p.m  EDT on Thursday, August 16, 2007.  The replay number is 800-633-8284 for U.S. callers and 402-977-9140 for international callers.  The reservation number is 21346424.

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.