FARMINGTON, Conn., July 31 /PRNewswire-FirstCall/ -- EDAC Technologies Corporation (OTC:EDAC.OB) (BULLETIN BOARD: EDAC.OB) , a designer and manufacturer of tools, fixtures, jet engine components, injection molds and spindles, today reported results for the second quarter of 2006. Sales for the second quarter of 2006 were $9,581,000 and net income was $414,000 or $0.09 per diluted share, versus sales of $8,899,000 and net income of $1,316,000 or $0.27 per diluted share for the second quarter of 2005. The second quarter of 2005 benefited from an income tax benefit of $787,000. Income from operations for the quarter increased to $794,000 in 2006 from $690,000 in 2005. For the six months ended July 1, 2006, sales were $19,176,000 and net income was $707,000 or $0.15 per diluted share versus sales of $16,916,000 and net income of $2,278,000 or $0.48 per diluted share for the six months ended July 2, 2005. The six months ended July 2, 2005 included an income tax benefit of $526,000 and debt forgiveness of $750,000. In addition, selling, general and administrative expenses for the six months ended July 1, 2006 include $342,000 of costs which were not incurred in the six months ended July 2, 2005 and consisted primarily of plant reconditioning and moving expenses, professional fees and bonuses. Dominick A. Pagano, President and Chief Executive Officer, said, "Our Precision Aerospace product line is expanding according to plan. Sales for the Precision Aerospace product line increased $2,920,000 or 66% for the six months ended July 1, 2006 compared to the six months ended July 2, 2005. Sales backlog for the Precision Aerospace product line has increased $6.9 million since the beginning of the year driving our total sales backlog from $21.7 million at December 31, 2005 to $28.3 million at the end of the second quarter. For the 2nd half of 2006, we expect continued strength in the Precision Aerospace product line offsetting lower sales in the Apex product line. Year to date we have invested over $1.8 million in machinery and equipment and have made commitments for an additional $1.1 million of machinery to be delivered in the third quarter. We plan to continue expanding our aerospace business and pursuing other opportunities that will strengthen EDAC for the long term." About EDAC Technologies Corporation EDAC Technologies Corporation is a diversified manufacturing company primarily offering (i) design and manufacturing services for the aerospace industry in such areas as jet engine parts, special tooling, equipment, gauges and components used in the manufacture, assembly and inspection of jet engines (ii) high-precision fixtures, gauges, dies and molds and (iii) the design, manufacture and repair of precision spindles, which are an integral part of numerous machine tools found in virtually every manufacturing environment. Cautionary Statement Regarding Forward Looking Statements -- This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The Company uses words such as "plans," seeks," "projects," "expects," "believes," "may," "anticipates," "estimates," "should," and similar expressions to identify these forward looking statements. These statements are subject to risks and uncertainties and are based upon the Company's beliefs and assumptions. There are a number of important factors that may affect the Company's actual performance and results and the accuracy of its forward-looking statements, many of which are beyond the control of the Company and are difficult to predict. These important factors include, without limitation, factors which could affect demand for the Company's products and services such as general economic conditions and economic conditions in the aerospace industry and the other industries in which the Company competes; competition from the Company's competitors; and the Company's ability to enter into satisfactory financing arrangements. These and other factors are described in the Company's annual and quarterly reports filed from time to time with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent the Company's expectations and beliefs as of the date of this release. The Company anticipates that subsequent events and developments may cause these expectations and beliefs to change. However, while the Company may elect to update these forward-looking statements at some point in the future, it specifically disclaims any obligation or intention to do so. EDAC TECHNOLOGIES CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS UNAUDITED For the three months ended For the six months ended July 1, July 2, July 1, July 2, 2006 2005 2006 2005 Sales $9,580,774 $8,899,338 $19,176,353 $16,915,512 Cost of sales 7,816,023 7,363,611 15,786,957 14,032,503 Gross profit 1,764,751 1,535,727 3,389,396 2,883,009 Selling, general and administrative expenses 970,278 845,891 1,984,143 1,572,782 Income from operations 794,473 689,836 1,405,253 1,310,227 Non-operating income (expense): Interest expense (165,076) (161,056) (318,475) (321,391) Gain on debt forgiveness - - - 750,000 Other income 41,634 - 56,022 13,646 Income before income taxes 671,031 528,780 1,142,800 1,752,482 Provision for (benefit from) income taxes 257,000 (787,000) 436,000 (526,000) Net income $414,031 $1,315,780 $706,800 $2,278,482 Income per common share data: Basic income per share $0.09 $0.29 $0.16 $0.51 Diluted income per share $0.09 $0.27 $0.15 $0.48 Weighted average shares outstanding: Basic 4,515,104 4,494,870 4,511,175 4,477,037 Diluted 4,800,896 4,791,243 4,796,109 4,745,207 EDAC TECHNOLOGIES CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Audited) July 1, December 31, 2006 2005 ASSETS CURRENT ASSETS: Cash $1,298,358 $2,468,964 Accounts receivable 6,752,311 5,587,305 Inventories, net 4,223,000 4,296,839 Prepaid expenses and other current assets 223,666 81,210 Refundable income taxes 54,984 54,984 Deferred income taxes 695,864 769,864 Total current assets 13,248,183 13,259,166 PROPERTY, PLANT AND EQUIPMENT 29,461,561 27,829,014 Less: accumulated depreciation 19,625,944 18,861,156 9,835,617 8,967,858 DEFERRED INCOME TAXES 1,440,989 1,440,989 OTHER ASSETS 97,415 108,833 TOTAL ASSETS $24,622,204 $23,776,846 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term debt $1,573,719 $1,404,053 Trade accounts payable 2,981,258 2,427,866 Employee compensation and amounts withheld 1,391,672 1,397,897 Accrued expenses 411,866 706,861 Customer advances 61,462 284,671 Total current liabilities 6,419,977 6,221,348 LONG-TERM DEBT, less current portion 7,702,900 7,791,530 OTHER LONG-TERM LIABILITIES 965,823 965,823 SHAREHOLDERS' EQUITY: Common stock 11,296 11,261 Additional paid-in capital 9,481,049 9,452,525 Retained earnings 1,723,584 1,016,784 Accumulated other comprehensive loss (1,682,425) (1,682,425) Total shareholders' equity 9,533,504 8,798,145 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $24,622,204 $23,776,846 Contact: Glenn L. Purple Vice President-Finance 860 677-2603 DATASOURCE: EDAC Technologies Corporation CONTACT: Glenn L. Purple, Vice President-Finance of EDAC Technologies Corporation, +1-860-677-2603 Web site: http://www.edactechnologies.com/

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