ROCKY HILL, Conn., April 23, 2008 (PRIME NEWSWIRE) -- Axsys Technologies, Inc. (Nasdaq:AXYS), a global leader in the design and development of high-performance surveillance cameras, imaging systems and related motion control technologies, today announced financial results for the first quarter ended March 29, 2008.

During the first quarter, Axsys generated revenues of $56.4 million, compared to $35.5 million in the first quarter of 2007. Net income was $5.1 million or $0.45 per diluted share, up from $3.0 million or $0.27 per diluted share in the first quarter of 2007. The results for the first quarter of 2007 include net income of $249 thousand or $0.02 per diluted share from the discontinued AST Bearings business, which was sold in November 2007.

First Quarter Financial Highlights from Continuing Operations

Period comparisons vs. the first quarter of 2007.



 * Sales increased 59% to a record $56.4 million;
 * Gross margin improved to 34.0% from 31.1%;
 * Operating margin improved to 14.2% from 13.0%;
 * Income increased 87% to $5.1 million;
 * Diluted earnings per share increased to $0.45 from $0.25;
 * Backlog increased to a record $158 million, representing a 13%
   increase compared to the end of the fourth quarter of 2007.

Compared to the same period in the prior year, the increase in sales was due to both strong organic growth across the company and the acquisition of the gyrostabilized gimbal business in April 2007. Margins were favorably impacted by the faster growth rate in the higher margin Surveillance Systems Group. Backlog growth was mainly attributable to the large infrared lens orders that we received for the Common Remotely Operated Weapon Station (CROWS) and Thermal Weapons Sight (TWS) programs.



 Segment Sales

      (Millions)                           Three Months Ended:
                                           -------------------
                                            Mar 29,   Mar 31,
                                             2008      2007
                                           -------------------
 Surveillance Systems Group                 $ 17.9    $  9.2
 Imaging Systems Group                        38.5      26.3

Compared to the first quarter of 2007, the Surveillance Systems Group's sales grew 95%. Cineflex generated $4.3 million of sales in the first quarter of 2007 and, consequently, pro forma sales growth, including the first quarter 2007 results for Cineflex, was 32%.

The Imaging Systems Group's sales grew 46% year over year. All business areas within the Imaging Systems segment grew during the quarter, with the infrared lens business performing particularly well.

"Both of our business segments achieved impressive results in the first quarter," said Stephen W. Bershad, Chairman and CEO of Axsys Technologies. "The Surveillance Systems Group met our high expectations, while increased throughput at our Imaging Systems Group produced better than expected results. The strong performance by both reporting segments has led the management team to increase its financial guidance for fiscal 2008."

Fiscal 2008 Earnings Guidance Increase

Axsys is increasing its full-year 2008 guidance as follows:



 * Sales are expected to be in the range of $224 million to
   $228 million, up from the $208 million to $212 million range
   previously provided.
 * Diluted earnings per share are expected to be in the range of
   $1.88 to $1.92, up from the previous guidance of $1.70 to $1.75.

"Our excellent first quarter results combined with a record backlog provide additional evidence of our enviable market position," continued Mr. Bershad. "To support continued growth, we plan to expand the manufacturing footprint of our infrared camera and lens businesses by leasing a new facility in the southern New Hampshire area. We expect this new facility to be operational during the second half of the year. With this additional capacity, we believe that we will be well-positioned for growth in the coming years."

Conference Call

Management will conduct a conference call to review the Company's financial results on Thursday, April 24, 2008 at 10:00 a.m. Eastern Time. Shareholders, institutional investors and equity research analysts are invited to participate in the call by dialing 1-888-713-4209 and providing the operator with the conference ID# 70467556 to enter the call.

The conference call will be webcast live via the Investor Relations section of the Company's web site at www.axsys.com. A replay of the webcast will be available shortly after the conclusion of the call for a period of approximately 90 days.

About Axsys

Axsys Technologies, Inc. is a global leader in the design and development of high-performance surveillance cameras, imaging systems and related motion control technologies, serving the aerospace, defense, and high-performance commercial markets. For more information, visit www.axsys.com.

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. One can identify these forward-looking statements by the use of the words such as "expect," "anticipate," "plan," "may," "will," "estimate" or other similar expressions. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materially. Important factors, which could cause actual results to differ materially, are described in Axsys' reports on Form 10-K and Form 10-Q filed with the Securities and Exchange Commission, including without limitation: changes in the U.S. federal government spending priorities; the Company's ability to compete in the industries in which it operates, including the introduction of competing products or technologies by other companies and/or pricing pressures from competitors and/or customers; the potential for the Company's backlog to be reduced or cancelled; the Company's ability to implement its acquisition strategy and integrate its acquired companies successfully, including the recent acquisition of Cineflex; the Company's ability to manage costs under the Company's fixed-price contracts effectively; and changes in general economic and business conditions. These statements reflect the Company's current beliefs and are based upon information currently available to the Company. Be advised that developments subsequent to this release are likely to cause these statements to become outdated with the passage of time, and we specifically disclaim any obligation to update these statements.



                     AXSYS TECHNOLOGIES, INC.
             Consolidated Statements of Operations
            (Dollars in thousands, except share and
                    per share data - Unaudited)

                                         For the Three Months Ended
                                      --------------------------------
                                      March 29, 2008    March 31, 2007
                                      --------------    --------------

 Sales                                 $     56,430      $     35,539
 Cost of sales                               37,223            24,496
                                       ------------      ------------
 Gross profit                                19,207            11,043

 Selling, general and
  administrative expenses                     9,257             5,341
 Research, development and
  engineering expenses                        1,957             1,083
                                       ------------      ------------
 Operating income                             7,993             4,619
 Interest expense                               (13)               (9)
 Interest income                                120                63
 Other income (expense), net                     36              (263)
                                       ------------      ------------
 Income from continuing operations
  before income taxes                         8,136             4,410
 Provision for income taxes                   3,028             1,676
                                       ------------      ------------
 Income from continuing operations            5,108             2,734
 Income from discontinued operations,
  net of income taxes                            --               249
                                       ------------      ------------
 Net income                            $      5,108      $      2,983
                                       ============      ============

 BASIC EARNINGS PER SHARE:
 Continuing operations                 $       0.47      $       0.26
 Discontinued operations                         --              0.02
                                       ------------      ------------
 Total                                 $       0.47      $       0.28
                                       ============      ============
 Weighted average basic common
  shares outstanding                     10,896,424        10,657,209

 DILUTED EARNINGS PER SHARE:
 Continuing operations                 $       0.45      $       0.25
 Discontinued operations                         --              0.02
                                       ------------      ------------
 Total                                 $       0.45      $       0.27
                                       ============      ============
 Weighted average diluted common
  shares outstanding                     11,451,052        10,945,641

                       AXSYS TECHNOLOGIES, INC.
                      Consolidated Balance Sheets
                        (Dollars in thousands)

                                      March 29, 2008    December 31,
                                        (Unaudited)        2007
                                       ------------     -----------
 ASSETS
 CURRENT ASSETS:
   Cash and cash equivalents            $  12,053        $  15,304
   Accounts receivable - net               23,919           14,140
   Inventories - net                       54,498           52,362
   Income taxes - deferred                  4,804            3,923
   Prepaid expenses                         1,315            1,047
   Other current assets                       404              491
                                        ---------        ---------
      TOTAL CURRENT ASSETS                 96,993           87,267
 PROPERTY, PLANT AND EQUIPMENT - net       18,486           17,876
 INTANGIBLE ASSETS - net                   12,028           12,286
 GOODWILL                                  85,620           85,620
 OTHER ASSETS                               1,556            1,634
                                        ---------        ---------
      TOTAL ASSETS                      $ 214,683        $ 204,683
                                        =========        =========

 LIABILITIES AND SHAREHOLDERS' EQUITY

 CURRENT LIABILITIES:
   Accounts payable                     $  13,074        $   9,325
   Accrued expenses and other
    current liabilities                    22,846           21,650
   Deferred income                         10,284           12,742
                                        ---------        ---------
      TOTAL CURRENT LIABILITIES            46,204           43,717
 OTHER LONG-TERM LIABILITIES                9,198            8,836
 SHAREHOLDERS' EQUITY:
   Common stock
                                              110              108
   Capital in excess of par               106,920          104,674
   Accumulated other comprehensive
    income                                   (271)             (81)
   Retained earnings                       52,924           47,816
   Treasury stock
                                             (402)            (387)
                                        ---------        ---------
      TOTAL SHAREHOLDERS' EQUITY          159,281          152,130
                                        ---------        ---------
      TOTAL LIABILITIES AND
       SHAREHOLDERS' EQUITY             $ 214,683        $ 204,683
                                        =========        =========

                       AXSYS TECHNOLOGIES, INC.
              Reconciliation of Pro Forma Sales Growth *
                  (Dollars in thousands - Unaudited)

                                          For the Three Months Ended
                                       -------------------------------
                                       March 29,    March 31,   Growth
 Surveillance Systems Segment            2008         2007       Rate
                                       --------     --------    ------
 Surveillance Systems Sales
  - As Reported                        $ 17,872     $  9,189      94%
 Gyrostabilized Gimbal Sales                 --        4,332      --
                                       --------     --------    ------
 Surveillance Systems Sales
   - Pro Forma                         $ 17,872     $ 13,521      32%
                                       ========     ========    ======

                                          For the Three Months Ended
                                       -------------------------------
                                       March 29,    March 31,   Growth
 Axsys Technologies Consolidated         2008         2007       Rate
                                       --------     --------    ------
 Axsys Technologies Sales
  - As Reported                        $ 56,430     $ 35,539      59%
 Gyrostabilized Gimbal Sales                 --        4,332      --
                                       --------     --------    ------
 Axsys Technologies Sales
  - Pro Forma                          $ 56,430     $ 39,871      42%
                                       ========     ========    ======

   * Sales presented on a pro forma basis to include pre-acquisition
     sales of Cineflex is a non-GAAP financial measure. Axsys presents
     pro forma sales because it believes that this information is a
     useful tool for investors to understand Axsys' post-acquisition
     sales growth.
Axsys Technologies, Inc.
David A. Almeida, Chief Financial Officer
 (860) 257-0200
Julie L. Oakes, Director of Investor Relations
 (860) 594-5751