Escalon(R) Reports Second Quarter Fiscal 20...(eased with thesedevelopments as we expec...)

Mr. DePiano added, "Turning to our operating performance for the second quarter of fiscal 2008, product revenue grew by $415,000, or 6%, to $7,450,000 compared to $7,034,000 last year. In the Drew business unit, product revenue increased $437,000, or 16%, compared with the same period last fiscal year. This is mainly due to the introduction of the newly introduced Trilogy and D3 instruments, and increased reagent revenues generated from Drew's United Kingdom facility."

"At our Sonomed business unit, product revenue decreased $203,000, or 7%, compared with the last fiscal year. This was primarily caused by an increase in sales discounts during the period, resulting from a large increase in sales to more price sensitive international markets combined with a decrease in overall domestic sales. Product revenue increased $80,000, or 10%, to $876,000 in the Vascular business unit during the three-month period ended December 31, 2007, compared with the same period last fiscal year. This was due to an increase in direct sales to end users by the Company's domestic sales team, and by turning over the territory of a terminated domestic distributor to the domestic sales team."

"In our Medical/Trek business unit, product revenue decreased $48,000, or 13%, to $331,000 during the second quarter 2008 as compared with the same period last fiscal year. This is primarily attributable to a decrease in the sale of Trek's mature product line and less contract work than in the same period last fiscal year. Additionally, product revenue increased $149,000, or 36% in our EMI business unit, when compared with last year. This is due to increased sales of digital imaging systems. The EMI division continues to realize the benefits of the successful expansion of its sales effort and product offerings."

Mr. DePiano concluded, "We continue to see improved sales pr
'/>"/>