Henry Bros. Electronics, Inc. Reports Third Quarter 2009 Results

FAIR LAWN, N.J., Nov. 12 /PRNewswire-FirstCall/ -- Henry Bros. Electronics,
Inc. (Nasdaq: HBE), a turnkey provider of technology-based integrated
electronic security solutions, today announced results for the third quarter
ended September 30, 2009.

The Company reported revenue of $12.1 million for the three months ended
September 30, 2009, representing a slight decrease from revenue of $12.3
million for the same period a year ago. This decline is due principally to the
protracted credit freeze and economic downturn which is having a significant
negative impact on construction markets and capital spending patterns of
commercial businesses. Partially offsetting this decline was an increase in
revenue resulting from the Company's agreement with a division of L-3
Communications, which is part of L-3's project for the U.S. Marine Corp.
Systems Command to deliver a Tactical Video Capture System ("TVCS"). TVCS is
used for real-time visualization and situational awareness while Marine units
are conducting military operations in urban terrain training exercises.

The Company reported a net loss of $357,382 or $0.06 per diluted share, for
the third quarter ended September 30, 2009, compared to net income of
$210,782, or $0.04 per diluted share, in the comparable period of 2008. The
Company's net loss is principally the result of the reduction in revenue,
pressure on gross profit margins and the costs associated with the investment
in a larger sales staff.

Revenue for the nine-month period ended September 30, 2009 was $41.4 million,
representing a decrease of 4.4% over revenue of $43.3 million for the nine
months ended September 30, 2008. The Company had a net loss for the 2009
nine-month period of $136,007, or $0.02 per diluted share, compared to net
income of $832,000, or $0.14 per diluted share, for the 2008 nine-month
period.

Jim Henry, CEO of Henry Bros. Electronics, commented, "A poor business climate
and new, hence unforeseen, administrative requirements which caused delays in
the TVCS project resulted in what is, undoubtedly, a disappointing quarter.
During the first and second quarters we began to see increased competition for
fewer jobs and longer negotiated sales cycles. These conditions persisted into
the third quarter. However, we are confident this shift will not be permanent
as the economy recovers."

Henry continued, "Despite the fact that our business has become more
competitive, our TVCS and other incumbent business is still strong. Going
forward, we intend to maintain and grow market share, and to find new and
innovative areas for revenue growth. We will also continue to effectively
manage our work force and will remain ready to take advantage of the spending
that has now shifted into 2010."

The Company's backlog as of September 30, 2009 was $23.8 million, and flat
when compared to the $23.7 million at December 31, 2008.

As a result of the protracted credit freeze, lingering recessionary
conditions, and continued delays related to the Company's TVCS project, the
Company is lowering its guidance from an operating profit of 3-5% on revenue
of $65 million to $70 million for fiscal 2009, to an essentially break-even
operating profit on revenue of between $50 million and $55 million for fiscal
2009.

In another development, at its November 11th meeting, the Board of Directors
appointed Richard D. Rockwell, 54, as Chairman of the Company's Board of
Directors. Rockwell has served on the Henry Bros. Board since November 2007.
Jim Henry will continue as Company CEO and Treasurer, as well as serve as
Vice-Chairman of the board.

Henry commented on the appointment of Rockwell, stating, "Rick has been a
major contributor on the Board for these past two years. I am pleased that we
will now be able to utilize his talents in a more prominent role. Our Company
launched a major new offering of managed and professional services in
September 2009. Given his 30-year background in the recurring revenue security
service business, we expect Rick to help us to leverage our technical
excellence to broaden our reach in these areas."

Rockwell also commented, stating "I have great confidence in the leadership of
Jim Henry and Brian Reach. The Company clearly has advanced capabilities and
superior technical expertise. Jim, Brian, and I, have a shared vision of
building on the Company's successes for the benefit of its customers,
shareholders, and employees. I look forward to working with them even more
closely in the future."

Conference Call Information:

Henry Bros. Electronics will be hosting a conference call on November 12,
2009, at 11 a.m. ET. To participate on the call, please use the following
number and conference code:
(888) 562-3356 (Domestic)
(973) 582-2700 (International)
Conference code: 39871791

A replay of the call will be available from 11/12/2009 at 12 p.m., ET,
through 12/12/2009 at 11:59 p.m., ET. To access the replay, please call
(800) 642-1687 in the United States or (706) 645-9291 outside the United
States. To access the replay, users will need to enter the following code:
39871791.

About Henry Bros. Electronics, Inc.

Henry Bros. Electronics (NASDAQ: HBE) provides technology-based integrated
electronic security systems, services and emergency preparedness consultation
to commercial enterprises and government agencies. The Company has offices in
Arizona, California, Colorado, Maryland, New Jersey, New York, Texas and
Virginia.

For more information, visit http://www.hbe-inc.com.

Safe Harbor Statement: Certain statements in this press release constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995, as amended. Forward-looking statements
inherently involve risks and uncertainties that could cause actual results to
differ materially from the forward-looking statements. In particular, there
can be no assurance that the Company will achieve revenues of $50 million to
$55 million or an essentially breakeven operating profit in 2009. Additional
information concerning factors that could cause actual results to differ
materially from those in the forward looking statements is contained under the
heading of risk factors listed in the Company's filings with the U.S.
Securities and Exchange Commission. Henry Bros. Electronics Inc. does not
assume any obligation to update the forward-looking information.

Investor Contacts:
Todd Fromer
KCSA Strategic Communications
212-896-1215
tfromer@kcsa.com

Jim Henry, Vice- Chairman & Chief Executive Officer
Henry Bros. Electronics, Inc.
201-794-6500
jhenry@hbe-inc.com

HENRY BROS. ELECTRONICS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited) (Unaudited)
Nine months ended Three months ended
September 30, September 30,
-------------------- --------------------
2009 2008 2009 2008
---- ---- ---- ----
Revenue $41,389,229 $43,292,368 $12,109,037 $12,262,372
Cost of revenue 30,255,049 32,148,857 9,086,980 8,649,920
---------- ---------- --------- ---------
Gross profit 11,134,180 11,143,511 3,022,057 3,612,452
Operating expenses:
Selling, general &
administrative
expenses 11,015,124 9,461,002 3,452,480 3,204,834
---------- --------- --------- ---------
Operating profit
(loss) 119,056 1,682,509 (430,423) 407,618

Interest income 21,023 73,732 11,986 20,751
Other income 29,274 9,656 13,481 1,408
Interest expense (222,333) (209,211) (56,926) (66,483)
-------- -------- ------- -------
(Loss) income before
tax expense (52,980) 1,556,686 (461,882) 363,294
Tax expense (benefit) 83,027 724,686 (104,500) 152,512
------ ------- -------- -------
Net (loss) income $(136,007) $832,000 $(357,382) $210,782
========= ======== ========= ========

BASIC (LOSS) EARNINGS PER COMMON SHARE:
---------------------------------------
Basic (loss)
earnings per
common share $(0.02) $0.14 $(0.06) $0.04
====== ===== ====== =====
Weighted average
common shares 5,859,400 5,783,425 5,877,798 5,798,108
========= ========= ========= =========

DILUTED (LOSS) EARNINGS PER COMMON SHARE:
-----------------------------------------
Diluted (loss)
earnings per
common share $(0.02) $0.14 $(0.06) $0.04
====== ===== ====== =====
Weighted average
diluted
common shares 5,859,400 5,975,221 5,877,798 5,989,904
========= ========= ========= =========

SOURCE Henry Bros. Electronics Inc.

Investor, Todd Fromer of KCSA Strategic Communications, +1-212-896-1215,
tfromer@kcsa.com; or Jim Henry, Vice- Chairman & Chief Executive Officer of
Henry Bros. Electronics, Inc., +1-201-794-6500, jhenry@hbe-inc.com