Revenue Increases 20%; Net Income Increases 110%



    OLATHE, Kan., July 29 /EMWNews/ -- Butler National

Corporation (OTC Bulletin Board: BUKS) a leading manufacturer and provider

of support systems for "Classic" commercial and military aircraft,

announces its financial results for the fourth quarter fiscal 2008 and year

ended April 30, 2008. In conjunction with the release, the Company has

scheduled a conference call Monday, August 4, 2008 at 9:00 AM Central

Daylight Time.



    What: Butler National Corporation Fourth Quarter and Fiscal Year End

Results Conference Call



    When: Monday, August 4, 2008 - 9:00AM Central Daylight Time



    How: Live via phone by dialing 800-624-7038. Code: Butler National

Corporation. Participants to the conference call should call in at least 5

minutes prior to the start time.



    Clark Stewart, President & CEO, Butler National Corporation, will be

leading the call and discussing results of the fourth quarter and year end

financial results, the status of existing and new business, and an outlook

on fiscal 2009. Mr. Stewart will also discuss Butler National's July 31st

presentation to the Kansas Lottery Review Board.










    Historical selected financial data related to all operations:



                          Year Ended April 30        Quarter Ended April 30

                         (In thousands except         (In thousands except

                            per share data)              per share data)



                          2008      2007    2006      2008     2007     2006



    Net Sales           $17,647  $14,681  $15,307    $4,446   $3,906   $3,072

    Operating Income      2,203    1,251      937     1,015      627      187

    Net Income            1,274      606      366       662      415       15

    Total Assets         27,104   20,445   18,138    27,104   20,445   18,138

    Long-term

     Obligations          6,416    2,521    1,844     6,416    2,521    1,844

    Stockholders'

     Equity              12,190   10,648    9,829    12,190   10,648    9,829

    Weighted Average

     Shares - Diluted    53,928   53,180   52,694    53,928   53,180   52,694

    New Product Research

     and Development

     Cost                 4,266    1,946    1,558       520      439      416



    nr = not reported



    Management Comments:



    "Fiscal 2008 beat a strong fiscal 2007 and became our second best year

ever for net income, $1,274,000, with sales of $17,647,000. Sales for

fiscal 2008 increased $2,966,000 (20%) from fiscal 2007. Net income for

fiscal 2008 increased $668,000, (110%) from fiscal 2007. We consider 2008

another successful year for Butler National. We continue our efforts to

improve the profitability in the delivery of high-value "Classic Aviation"

products.



    During Fiscal 2008, we invested approximately $4,266,000 toward new

business development. Approximately $2,450,000 is invested in gaming

development activities in Kansas and $1,817,000 in the development and

acquisition of new products. We feel this expenditure for the design and

development engineering, testing, and certification of new products may

stabilize our long-term revenues and enhance our profits. We believe our

investment in Kansas property will position Butler for a gaming management

agreement that may be awarded to us by the State of Kansas in this calendar

year.



    Avionics:



    Fiscal 2008 Avionics sales were $5,025,000, an increase of $1,486,000

(42.0%) from fiscal 2007. This increase is directly related to sales of

defense products. Fiscal 2008 Avionics operating profit was $843,000, an

increase of $556,000 (193.6%) from fiscal 2007. This increase in operating

profit is related to streamlined assembly processes and a stable and

experienced production staff. Management expects long-term increased sales

for the fuel system protection devices when certified like the TSD, GFI,

and other classic aviation and defense products.



    Aircraft Modifications:



    Fiscal 2008 sales for Aircraft Modifications were $8,647,000, an

increase of $1,950,000 (29.1%) from fiscal 2007. Fiscal 2008 operating

profit for Aircraft Modifications was $815,000, an improvement of

$1,042,000 from fiscal 2007. Sales and profits were driven by a strong

demand for camera installations and performance enhancing modifications.



    We believe we will sell and install approximately 25 to 35 Lear 20 & 30

series RVSM kits during the next two years. In addition to the RVSM sales,

we expect to experience some increase in our base modification sales. A

shift to business aircraft ownership from commercial airline travel may

positively impact our aircraft modification revenues.



    Professional Services:



    Revenue from Services decreased from $2,403,000 in fiscal 2007 to

$1,558,000 in fiscal 2008, a decrease of 35.2%. During fiscal 2008, we

maintained a relatively level volume of long-term contracts with

municipalities. Revenues decreased due to the delay in the contract for the

rehabilitation of city lift stations. The economic reality of lower tax

revenue to the municipalities curtailed spending budgets for new equipment

and upgrades. At some time, we anticipate the revenues from additional lift

station rehabilitations to resume and generate additional revenue over the

next four years. Revenue fluctuates due to the introduction of new products

and services and the related installations of these types of products. Our

contracts with our two largest customers have been renewed through fiscal

2009. An operating profit of $138,000 in Monitoring Services was recorded

in fiscal 2008, compared to a fiscal 2007 profit of $186,000 a decrease of

25.6%. We believe the service business has had revenue stability over the

past few years and we expect this to continue.



    Revenues from management services related to gaming decreased 9.7% for

fiscal 2008 compared with fiscal 2007. The decrease is related to the

forced closing during the flood in July 2007 and extreme inclement weather

during the winter months in Northeast Oklahoma.



    Backlog:



    As of July 3, 2008, our backlog is $7.8 million. This backlog reflects

our product development efforts and the related potential results. Our

challenges are to ship and add to the backlog and further take advantage of

these new products. However, because of our major investment in product

development required to continue these new products, we may not always

maintain smooth and continuous quarterly profits.



    "We are moving confidently into 2009 and believe we are well positioned

for the future as we focus on serving the needs of our customers and

enhancing shareholder value," commented Clark D. Stewart, President of the

Company.



    Our Business:



    Butler National Corporation operates in the Aerospace and Services

business segments. The Aerospace segment focuses on the manufacturing of

support systems for "Classic" commercial and military aircraft including

the Butler National TSD for the Boeing 737 and 747 Classic aircraft,

switching equipment for Boeing/Douglas Aircraft, weapon control systems for

Boeing Helicopter and performance enhancement structural modifications for

Learjet, Cessna, Dassault and Hawker/Beechcraft business aircraft. Services

include electronic monitoring of water pumping stations, temporary employee

services, Indian gaming services and administrative management services.



    Forward-Looking Information:



    The information set forth above may include "forward-looking"

information as outlined in the Private Securities Litigation Reform Act of

1995. The Cautionary Statements and Risk Factors, filed by the Company as

Exhibit 99 to the Company's Annual Report on Form 10-K and Section 1A of

Form 10-K, are incorporated herein by reference and investors are

specifically referred to such Cautionary Statements and Risk Factors for

discussion of factors, which could affect the Company's operations, and

forward-looking statements contained herein.






    FOR MORE INFORMATION, CONTACT:

    Craig D. Stewart, Investor Relations            Ph   (214) 498-7775

    Butler National Corporation                     Fax  (913) 780-5088

    19920 W. 161st Street

    Olathe, KS  66062



    Jim Drewitz, Public Relations                   Ph   (830) 669-2466

    [email protected]



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    Please review http://www.butlernational.com for pictures of our products and

details about Butler National Corporation and its subsidiaries.