MTS Systems (MTSC)

Test Segment:

On a sequential basis, orders rose 21 percent compared to third quarter fiscal 2009, reflecting the impact of an extra week in the fourth quarter and order timing. Also on a sequential basis, backlog increased 2 percent to $157 million.

On a year-over-year basis, orders for the Test segment were $79.0 million, a decrease of 14 percent. The organic business was down 22 percent due to lower volume in the Americas and Europe, partially offset by increased volume in Asia and a 8 percent increase from SANS.

Revenue in the segment was $77.9 million, a decrease of 22 percent compared to last year. The organic business declined 31 percent, while SANS contributed 9 percent growth in the quarter.

Gross profit was $22.6 million, a 43 percent reduction compared to last year. Fourth quarter gross margin rate was 28.9 percent, a decrease of 10.9 percentage points. The organic business decreased 12.4 percentage points primarily resulting from lower volume, severance charges and higher warranty expense. The severance charges and higher warranty expense reduced the gross margin rate by 7.3 and 3.4 percentage points, respectively. Gross margin benefited from a favorable product mix and reduced variable compensation expense. SANS favorably impacted the gross margin rate by 1.5 percentage points.

Loss from operations was $4.9 million. This includes a 135 percent decline in the organic business, primarily due to lower gross profit and severance charges, partially offset by reduced variable compensation and other operating expenses. The organic business results include $7.2 million of severance charges and a $1.7 million reduction in variable compensation expense. SANS had operating income of $0.5 million in the quarter.

Sensors Segment:

On a sequential basis, orders increased 9 percent compared to third quarter fiscal 2009, reflecting the impact of an extra week in the fourth quarter compared to the previous quarter. Backlog rose sequentially 8 percent to $11 million. On a year-over-year basis, orders and revenue were down 29 percent and 35 percent, respectively, driven by lower worldwide demand. Gross profit was $8.7 million, down 38 percent compared to last year. Fourth quarter gross margin rate was 55.0 percent, a decrease of 2.4 percentage points compared to fourth quarter fiscal 2008, resulting from lower volume.

Test Segment:

On a sequential basis, orders rose 23 percent compared to second quarter 2009, driven by a 27 percent increase in the organic business, partially offset by a 7 percent decrease in the SANS business. Also on a sequential basis, backlog decreased 8 percent to $153 million, which includes an 8 percent and 3 percent decline in the organic and SANS businesses, respectively.

On a year-over-year basis, orders for the Test segment were $65.5 million, a decrease of 29 percent. The organic business was down 33 percent due to lower volume across all geographies and a 3 percent unfavorable impact of currency translation, partially offset by a 7 percent increase from SANS. Third quarter fiscal 2008 orders included one large order (orders exceeding $5 million) totaling approximately $10 million. There were no such large orders in this quarter.

Revenue was $76.5 million, a decrease of 17 percent compared to last year. The organic business declined 21 percent, while SANS contributed 7 percent growth in the quarter. Currency translation unfavorably impacted revenue by 3 percent.

Gross profit was $26.9 million, a 20 percent reduction compared to last year. Third quarter gross margin rate was 35.2 percent, a decrease of 1.1 percentage points compared to the prior year. The organic business decreased 1.7 percentage points primarily resulting from lower volume and severance charges. SANS favorably impacted the gross margin rate by 0.6 percentage points.

Income from operations was $4.1 million, a year-over-year decrease of 60 percent. This includes a 75 percent decline in the organic business, primarily due to lower gross profit and severance charges, partially offset by reduced operating expenses. The organic business results include $1.0 million of severance charges. SANS broke even in the quarter.

Test Segment:

Orders for the Test segment were $53.5 million, a decrease of 49 percent compared to the prior year. The organic business was down 53 percent due to lower volume across all geographies and a two percent unfavorable impact of currency translation, partially offset by a six percent increase from SANS. Second quarter fiscal 2008 orders included three large orders in excess of $5 million totaling approximately $30 million. There were no such large orders in this quarter. On a sequential basis, backlog decreased 20 percent to $166 million, which includes a 22 percent negative impact from the organic business, partially offset by an 18 percent benefit from SANS. Revenue was $91.0 million, an increase of four percent compared to last year. The organic business volume was relatively flat, while SANS contributed five percent growth in the quarter. Currency translation unfavorably impacted revenue by two percent.

Gross profit was $32.5 million, relatively flat compared to the prior year. Second quarter gross margin rate was 35.7 percent, a decrease of 1.1 percentage points compared to the prior year. The organic business decreased 1.4 percentage points primarily resulting from severance charges and higher warranty expense, partially offset by favorable product mix and reduced variable compensation expense. SANS favorably impacted the gross margin rate by 0.3 percentage points.

Income from operations was $9.2 million, a year-over-year increase of 10 percent. It includes a 29 percent increase in the organic business, primarily due to reduced variable compensation and other operating expenses, partially offset by severance charges and higher warranty costs. The organic business results include $2.7 million of the severance charges and a $3.4 million reduction in variable compensation expense. SANS had an operating loss of $1.2 million in the quarter driven by acquisition-related items.

Sensors Segment:

Orders for the Sensors segment were $15.7 million, a decrease of 37 percent compared to second quarter fiscal 2008, due to lower volume across all geographies, including a three percent unfavorable impact of currency translation. Backlog decreased 18 percent to $9 million compared to first quarter fiscal 2009. Revenue was $16.7 million, a decline of 32 percent from the prior year, driven by decreased volume worldwide, and includes a four percent negative impact from currency translation.

Test Segment:

Orders for the Test segment were $77.0 million, a decrease of 24 percent compared to the prior year. Organic business was down 28 percent due to decreased volume across all geographies and a one percent unfavorable impact of currency translation, partially offset by a five percent increase from SANS. First quarter fiscal 2008 orders included one large custom order for approximately $7 million. Backlog decreased seven percent to $208 million compared to fourth quarter fiscal 2008, down 12 percent in the organic business, partially offset by a five percent increase from SANS. Revenue was $97.2 million, an increase of 15 percent compared to last year. The organic business grew 15 percent, primarily driven by an increase in custom business in opening backlog, and SANS contributed four percent growth in the quarter. Currency translation unfavorably impacted revenue by four percent.

Gross profit was $33.3 million, an increase of 11 percent compared to the prior year. First quarter gross margin rate was 34.2 percent, a decrease of 1.5 percentage points compared to the prior year. The organic business declined 1.0 percentage point, primarily due to a higher mix of custom projects with lower margins and higher material costs. SANS negatively impacted the gross margin rate by 0.5 percentage points, primarily resulting from the valuation of inventory at fair market associated with the acquisition.

Income from operations was $9.0 million, a year-over-year increase of 30 percent. It includes a 64 percent increase in the organic business, primarily due to higher gross profit and reduced operating expenses. SANS had an operating loss of $2.3 million in the quarter driven by acquisition related items.

Sensors Segment:

Orders for the Sensors segment were $18.3 million, a decrease of 18 percent compared to first quarter fiscal 2008, due to decreased volume across all geographies, including a two percent unfavorable impact of currency translation. Backlog decreased eight percent to $11 million compared to fourth quarter fiscal 2008. Revenue was $19.4 million, a decrease of 16 percent from the prior year, driven by decreased volume worldwide, and includes a two percent negative impact from currency.

Test Segment:

Fourth Quarter:

Test segment orders were $91.9 million for fourth quarter fiscal 2008, an increase of 8 percent compared to fourth quarter fiscal 2007, reflecting an increase in the Americas and Europe. During the fourth quarter of fiscal 2008, the Company booked one large custom order for approximately $5 million, compared to fiscal 2007 orders which included one large custom order of approximately $7 million. Backlog decreased 3 percent to $223 million compared to the third quarter of fiscal 2008. Fourth quarter revenue was $99.7 million, an increase of 14 percent compared to fourth quarter fiscal 2007, primarily due to an increase in custom business.

Test Segment:

Orders for the Test segment were $91.9 million, an increase of 4 percent compared to orders of $88.5 million for third quarter fiscal 2007, primarily due to the favorable impact of currency translation. Fiscal 2008 orders included one large custom order worth approximately $10 million compared to fiscal 2007 orders, which included two large custom orders totaling approximately $17 million. Backlog decreased 2 percent to $230 million from $234 million in second quarter of fiscal 2008. Revenue was $92.4 million, an increase of 8 percent compared to $85.7 million for third quarter fiscal 2007, reflecting higher custom business.

Gross profit was $33.6 million, or 36.4 percent, compared to $30.5 million, or 35.6 percent for third quarter fiscal 2007. This increase was primarily due to higher volume, partially offset by unfavorable product mix. Income from operations was $10.3 million, an increase of 43 percent compared to income from operations of $7.2 million for third quarter fiscal 2007. The increase was primarily attributable to higher gross profit and lower research and development expense, partially offset by planned increases in sales and marketing expenditures.

Sensors Segment:

Orders for the Sensors segment were $24.8 million, an increase of 18 percent compared to orders of $21.1 million for third quarter fiscal 2007, reflecting business growth across all geographies. Backlog increased 8 percent to $13 million from $12 million in second quarter fiscal 2008. Revenue was $24.5 million, an increase of 26 percent compared to revenue of $19.5 million for third quarter fiscal 2007, driven by increased volume in all geographies.

Gross profit was $13.6 million, an increase of 28 percent compared to $10.6 million for third quarter fiscal 2007, primarily reflecting higher volume. Income from operations was $4.5 million, an increase of 29 percent compared to income from operations of $3.5 million for third quarter fiscal 2007, primarily due to higher gross profit, partially offset by planned increases in operating expenses.

Test Segment:

Orders for the Test segment were $106.3 million, an increase of 38 percent compared to orders of $77.3 million for second quarter fiscal 2007, reflecting strong bookings in all geographies. Orders included three custom orders in excess of $5 million totaling approximately $30 million. Backlog increased 8 percent in second quarter fiscal 2008, from $217 million in first quarter of fiscal 2008, to a record $234 million. Revenue was $90.1 million, an increase of 9 percent compared to $82.9 million for second quarter fiscal 2007, reflecting higher standard product and service business.

Gross profit was $33.3 million, or 37.0 percent, compared to $35.5 million, or 42.8 percent for second quarter fiscal 2007. This decrease was primarily due to unfavorable product mix and higher custom project costs, partially offset by increased volume. Income from operations was $8.5 million, a decrease of 34 percent compared to income from operations of $12.8 million for second quarter fiscal 2007. The decrease was primarily attributable to lower gross profit, and planned increases in sales and marketing expenditures.

Sensors Segment:

Orders for the Sensors segment were $25.1 million, an increase of 27 percent compared to orders of $19.7 million for second quarter fiscal 2007, reflecting business growth across all geographies. Backlog was flat at $12 million. Revenue was $24.4 million, an increase of 29 percent compared to revenue of $18.9 million for second quarter fiscal 2007, driven by increased volume in all geographies.

Gross profit was $13.8 million, an increase of 33 percent compared to $10.4 million for second quarter fiscal 2007, primarily reflecting the benefit of increased volume on factory utilization. Income from operations was $5.5 million, an increase of 41 percent compared to income from operations of $3.9 million for second quarter fiscal 2007, primarily due to increased gross profit, partially offset by planned increases in operating expenses.

Test Segment:

Orders for the Test segment were $103.5 million, an increase of 10 percent compared to orders of $93.7 million for first quarter fiscal 2007, reflecting strong bookings in North America and an estimated $2.6 million favorable impact of currency translation, partially offset by decreased volume in Asia. Orders included one large custom order for approximately $7 million. Backlog increased 12 percent, from $194 million to $217 million, with approximately $6 million of this increase due to the favorable impact of currency translation. Revenue was $86.9 million, an increase of 7 percent compared to $81.3 million for first quarter fiscal 2007, reflecting higher standard product and service business and an estimated $2.9 million favorable impact of currency translation.

Gross profit was $31.2 million, or 35.9 percent, compared to $32.3 million, or 39.7 percent. This decrease is primarily due to unfavorable product mix and additional custom project costs, partially offset by increased volume and an estimated $0.5 million favorable impact of currency translation. Income from operations was $7.2 million, a decrease of 23 percent compared to income from operations of $9.4 million for first quarter fiscal 2007. The decrease was primarily attributable to lower gross profit and planned increases in sales and marketing expenditures, as well as an estimated $0.2 million unfavorable impact of currency translation.

Sensors Segment:

Orders for the Sensors segment were $22.3 million, an increase of 25 percent compared to orders of $17.8 million for first quarter fiscal 2007, reflecting business growth in all geographies and an estimated $1.4 million favorable impact of currency translation. Backlog was flat at $12 million. Revenue was $23.2 million, an increase of 30 percent compared to revenue of $17.8 million for first quarter fiscal 2007, driven by increased volume in all geographies and an estimated $1.3 million favorable impact of currency translation.

Gross profit was $13.1 million, an increase of 34 percent compared to $9.8 million for first quarter fiscal 2007, primarily reflecting the benefit of increased volume on factory utilization. Income from operations was $5.1 million, an increase of 59 percent compared to income from operations of $3.2 million for first quarter fiscal 2007, primarily due to increased gross profit and an estimated $0.4 million favorable impact of currency translation, partially offset by planned increases in operating expenses.

MTS News Release

Page 3

Test Segment:

Test segment orders were $87.5 million for fourth quarter fiscal 2007, an increase of 5 percent compared to orders of $83.2 million for fourth quarter fiscal 2006, reflecting an increase in Europe and Asia and an estimated $2.4 million favorable impact of currency translation. During the fourth quarter of fiscal 2007, the Company booked one large custom order of approximately $7 million, and cancelled one large custom order of approximately $10 million. Backlog decreased 1 percent in the quarter, from $196 million to $194 million. Fourth quarter revenue was $90.2 million, an increase of 1 percent compared to $89.5 million for fourth quarter fiscal 2006. The increase was primarily due to an estimated $2.4 million favorable impact of currency translation, partially offset by decreased custom project revenue.

Fourth quarter gross profit was $35.5 million, or 39.4 percent, compared to $36.3 million, or 40.6 percent, for fourth quarter fiscal 2006, primarily due to unfavorable product mix and additional custom project costs, partially offset by decreased warranty and performance based compensation expense and an estimated $0.4 million favorable impact of currency translation.

Income from operations for fourth quarter fiscal 2007 was $10.4 million, a decrease of 9 percent compared to income from operations of $11.4 million for fourth quarter fiscal 2006. This decrease was primarily due to lower gross profit and planned increases in sales, marketing, and R&D spending to support strategic initiatives. There was no significant impact on income from operations from currency translation.

Test segment orders for fiscal 2007 totaled $349.3 million, an increase of 12 percent compared to orders of $310.7 million for fiscal 2006, reflecting an increase in Asia and an estimated $6.3 million favorable impact of currency translation. Fiscal 2007 orders included five large custom orders which aggregated approximately $40 million. Backlog increased 5 percent during the year, from $184 million to $194 million. Fiscal 2007 revenue was $343.6 million, an increase of 3 percent compared to $332.6 million for fiscal 2006, driven by an increase in standard product and service business and an estimated $8.7 million favorable impact of currency translation.

Fiscal 2007 gross profit was $135.5 million, or 39.4 percent, compared to $138.2 million, or 41.6 percent, for fiscal 2006, due to unfavorable product mix and additional custom project costs, partially offset by increased volume, and an estimated $1.9 million favorable impact of currency translation.

Income from operations for fiscal 2007 was $40.7 million, a decrease of 9 percent compared to $44.7 million for fiscal 2006. This decrease was primarily due to lower gross profit and planned increases in selling, marketing, and R&D for strategic initiatives, partially offset by an estimated $0.3 million favorable impact of currency translation.

Sensors Segment:

Sensors segment orders were $22.2 million for fourth quarter fiscal 2007, an increase of 26 percent compared to orders of $17.6 million for fourth quarter fiscal 2006, due to continued growth in all geographies, and an estimated $0.8 million favorable impact of currency translation. Backlog increased 20 percent in the quarter, from $10 million to $12 million. Fourth quarter revenue was $20.9 million, an increase of 25 percent compared to revenue of $16.7 million for fourth quarter fiscal 2006, driven by increased worldwide volume and an estimated $0.9 million favorable impact of currency translation.

Fourth quarter gross profit was $11.9 million, or 56.9 percent, compared to $9.0 million, or 53.9 percent, for fourth quarter fiscal 2006, reflecting increased volume and improved operational efficiency.

Income from operations for fourth quarter fiscal 2007 was $4.1 million, an increase of 24 percent compared to income from operations of $3.3 million for fourth quarter fiscal 2006, primarily due to increased gross profit, and an estimated $0.2 million favorable impact of currency translation, partially offset by planned increases in operating expenses to support strategic initiatives.

MTS News Release

Page 4

Sensor segment orders for fiscal 2007 were $80.8 million, an increase of 22 percent compared to orders of $66.2 million for fiscal 2006, reflecting increased worldwide growth and an estimated $2.8 million favorable impact of currency translation. Backlog increased 50 percent during the year, from $8 million to $12 million. Fiscal 2007 revenue was $76.9 million, an increase of 20 percent compared to $64.2 million for fiscal 2006, driven by increased worldwide volume and an estimated $2.9 million favorable impact of currency translation.

Fiscal 2007 gross profit was $42.7 million, or 55.5 percent, compared to $34.5 million, or 53.7 percent, for fiscal 2006, primarily due to increased volume and improved operational efficiency, and an estimated $1.5 favorable impact of currency translation.

Income from operations for fiscal 2007 was $14.8 million, an increase of 33 percent compared to income from operations of $11.1 million for fiscal 2006, primarily due to increased gross profit and an estimated $0.7 million favorable impact of currency translation, partially offset by planned increases in operating expenses to support strategic initiatives.

Test Segment:

Third quarter orders for the Test segment were $90.8 million, an increase of 13 percent compared to orders of $80.7 million for third quarter fiscal 2006, reflecting an increase in North America and Europe, and an estimated $0.4 million favorable impact of currency translation. Orders included two large custom orders which aggregated to approximately $17 million. Backlog increased 1 percent sequentially in the quarter, from $195 million to $196 million. Third quarter revenue was $89.1 million, an increase of 12 percent compared to $79.3 million for third quarter fiscal 2006, reflecting an increase in the proportion of standard product and service business and an estimated $1.0 million favorable impact due to currency translation. Third quarter gross profit was $32.2 million, an increase of 1 percent compared to $31.9 million for third quarter fiscal 2006, primarily due to increased volume, which was offset by unplanned project costs and higher warranty expense. The impact of currency translation was an estimated $0.2 million favorable. Third quarter gross margin rate was 36.1 percent, a decrease of 4.1 percentage points compared to 40.2 percent for third quarter fiscal 2006. The decrease in margin rate was primarily due to higher custom project and warranty expense. Income from operations for the quarter was $8.2 million, a decrease of 8 percent compared to income from operations of $8.9 million for third quarter fiscal 2006, primarily due to planned increases in sales, marketing, and R&D spending to support strategic initiatives, partially offset by higher gross profit.

Sensors Segment:

Third quarter orders for the Sensors segment were $21.1 million, an increase of 24 percent compared to orders of $17.0 million for third quarter fiscal 2006, reflecting business growth in all geographies, and an estimated $0.3 million favorable impact of currency translation. One large order accounted for 8 percentage points of growth. Backlog increased 11 percent sequentially in the quarter, from $9 million to $10 million. Third quarter revenue was $19.5 million, an increase of 17 percent compared to revenue of $16.6 million for third quarter fiscal 2006, driven by increased worldwide volume and an estimated $0.4 million favorable impact of currency translation. Third quarter gross profit was $10.6 million, an increase of 16 percent compared to $9.1 million for third quarter fiscal 2006, reflecting increased volume, and an estimated $0.2 million favorable impact of currency translation. Third quarter gross margin rate was 54.4 percent, down slightly compared to 54.8 percent for third quarter fiscal 2006. Income from operations for the quarter was $3.5 million, an increase of 21 percent compared to income from operations of $2.9 million for third quarter fiscal 2006, primarily due to increased volume.

Test Segment:

Second quarter orders for the Test segment were $77.3 million, an increase of 19 percent compared to orders of $65.1 million for second quarter fiscal 2006, reflecting an increase in North America and Asia and an estimated $1.5 million favorable impact of currency translation, partially offset by decreased volume in Europe. Orders included one large custom order in excess of $5 million. Backlog decreased 3 percent in the quarter, from $200 million to $195 million. Second quarter revenue was $82.9 million, a decrease of 5 percent compared to $87.0 million for second quarter fiscal 2006, reflecting decreased project revenue, partially offset by an estimated $2.6 million favorable impact of currency translation. Second quarter gross profit was $35.5 million, a decrease of 5 percent compared to $37.4 million for second quarter fiscal 2006, primarily due to decreased volume and unfavorable product mix, partially offset by an estimated $0.6 million favorable impact of currency translation. Income from operations for second quarter fiscal 2007 was $12.8 million, a decrease of 12 percent compared to income from operations of $14.6 million for second quarter fiscal 2006.

Sensors Segment:

Second quarter orders for the Sensors segment were $19.7 million, an increase of 20 percent compared to orders of $16.4 million for second quarter fiscal 2006, reflecting business growth in all geographies and an estimated $0.9 million favorable impact of currency translation. Backlog increased 13 percent in the quarter, from $8 million to $9 million. Second quarter revenue was $18.9 million, an increase of 19 percent compared to revenue of $15.9 million for second quarter fiscal 2006, driven by increased worldwide volume and an estimated $0.8 million favorable impact of currency translation. Second quarter gross profit was $10.4 million, an increase of 24 percent compared to $8.4 million for second quarter fiscal 2006, reflecting increased volume, improved capacity utilization, and an estimated $0.4 million favorable impact of currency translation. Income from operations for second quarter fiscal 2007 was $3.9 million, an increase of 56 percent compared to income from operations of $2.5 million for second quarter fiscal 2006, primarily due to increased gross profit, partially offset by planned increases in operating expenses.

Test Segment:

First quarter orders for the Test segment were $93.7 million, an increase of 15 percent compared to orders of $81.7 million for first quarter fiscal 2006, reflecting large custom order bookings in Asia and an estimated $2.0 million favorable impact of currency translation, partially offset by decreased volume in North America. Backlog increased 9 percent in the quarter, from $184 million to $200 million, with approximately $4 million of this increase due to the favorable impact of currency translation. First quarter revenue was $81.3 million, an increase of 6 percent compared to $76.8 million for first quarter fiscal 2006, reflecting an increase in short-cycle and service business and an estimated $2.6 million favorable impact of currency translation. First quarter gross profit was $32.3 million, a decrease of 1 percent compared to $32.7 million for first quarter fiscal 2006, due to unfavorable product mix and increased manufacturing and support costs, largely offset by higher volume and an estimated $0.7 million favorable impact of currency translation. Income from operations for first quarter fiscal 2007 was $9.4 million, a decrease of 5 percent compared to income from operations of $9.9 million for first quarter fiscal 2006. The decrease was primarily attributable to planned increases in operating expenses, partially offset by an estimated $0.3 million favorable impact of currency translation.

Sensors Segment:

Effective this quarter, the former “Industrial” segment has been re-named to the “Sensors” segment.

First quarter orders for the Sensors segment were $17.8 million, an increase of 17 percent compared to orders of $15.2 million for first quarter fiscal 2006, reflecting business growth in all geographies and an estimated $0.8 million favorable impact of currency translation. Backlog was flat in the quarter at $8 million. First quarter revenue was $17.8 million, an increase of 19 percent compared to revenue of $15.0 million for first quarter fiscal 2006, driven by increased volume in Europe and Asia and an estimated $0.8 million favorable impact of currency translation. First quarter gross profit was $9.8 million, an increase of 24 percent compared to $7.9 million for first quarter fiscal 2006, reflecting increased volume and improved capacity utilization. Income from operations for first quarter fiscal 2007 was $3.2 million, an increase of 33 percent compared to income from operations of $2.4 million for first quarter fiscal 2006, primarily due to increased gross profit and an estimated $0.2 million favorable impact of currency translation, partially offset by planned increases in operating expenses.

Test Segment:

Test segment orders were $83.2 million for fourth quarter fiscal 2006, a decrease of 12 percent compared to orders of $94.1 million for fourth quarter fiscal 2005, primarily due to a reduction in large custom orders. Backlog decreased 4 percent in the quarter, from $191 million to $184 million. Fourth quarter revenue was $89.5 million, an increase of 20 percent compared to $74.7 million for fourth quarter fiscal 2005. This increase reflects low volume in fiscal 2005 due to a supplier issue, partially offset by a $2.1 million reduction in revenue associated with the noise and vibration business. Fourth quarter gross profit was $36.3 million, an increase of 16 percent compared to $31.4 million for fourth quarter fiscal 2005, primarily due to higher volume and $3.6 million in fiscal 2005 costs associated with the noise and

MTS News Release

Page 3

vibration business exit. Income from operations for fourth quarter fiscal 2006 was $11.4 million, an increase of 54 percent compared to income from operations of $7.4 million for fourth quarter fiscal 2005. This increase was due to higher gross profit and $0.9 million of prior year costs associated with the exit of the noise and vibration business, partially offset by $1.0 million of stock compensation expense.

Orders for fiscal 2006 were $310.7 million, a decrease of 9 percent compared to orders of $342.9 million for fiscal 2005, primarily due to a decrease in large custom orders in Europe and Asia and $8.4 million of prior year orders associated with the noise and vibration business. Orders in North America increased. Backlog decreased to $184 million from $214 million at the end of fiscal 2005. Fiscal 2006 revenue was $332.6 million, an increase of 6 percent compared to $313.5 million for fiscal 2005, primarily due to increased short-cycle and service business, which was partially offset by a $7.7 million reduction in revenue associated with the noise and vibration business as well as an estimated $7.8 million unfavorable impact of currency translation. Fiscal 2006 gross profit was $138.2 million, an increase of 3 percent compared to $134.0 million for fiscal 2005, due to higher volume and $3.6 million in fiscal 2005 costs associated with the exit of the noise and vibration business, partially offset by $1.1 million of stock compensation expense and an estimated $1.3 million unfavorable impact of currency translation. Income from operations for fiscal 2006 was $44.7 million, flat compared to fiscal 2005 income from operations. Higher gross profit, a $0.9 million fiscal 2006 gain on sale of assets of the noise and vibration business, and $0.9 million of prior year costs associated with the exit of the noise and vibration business were offset by planned increases in operating expenses, $3.8 million of stock compensation expense, and $0.4 million unfavorable impact of currency translation.

Industrial Segment:

Industrial segment orders were $17.6 million for fourth quarter fiscal 2006, an increase of 13 percent compared to orders of $15.6 million for fourth quarter fiscal 2005, due to continued growth in the Sensors business in Europe and Asia. Backlog increased 14 percent in the quarter, from $7 million to $8 million. Fourth quarter revenue was $16.7 million, an increase of 6 percent compared to revenue of $15.8 million for fourth quarter fiscal 2005, driven by increased volume in Europe and Asia. Fourth quarter gross profit was $9.0 million, an increase of 15 percent compared to $7.8 million for fourth quarter fiscal 2005, reflecting increased volume and improved capacity utilization. Income from operations for fourth quarter fiscal 2006 was $3.3 million, an increase of 83 percent compared to income from operations of $1.8 million for fourth quarter fiscal 2005, primarily due to increased gross profit, partially offset by $0.1 million of stock compensation expense.

Orders for fiscal 2006 were $66.2 million, an increase of 8 percent compared to orders of $61.5 million for fiscal 2005, primarily due to increased volume in the Sensors business in Europe and Asia. Backlog increased to $8 million at the end of fiscal 2006 from $6 million at the end of fiscal 2005. Fiscal 2006 revenue was $64.2 million, an increase of 5 percent compared to $60.9 million for fiscal 2005, primarily due to higher order volume in Europe and Asia, partially offset by an estimated $1.8 million unfavorable impact of currency translation. Fiscal 2006 gross profit was $34.5 million, an increase of 17 percent compared to $29.6 million for fiscal 2005, primarily due to increased volume and fiscal 2005 charges associated with obsolete inventory. This was partially offset by an estimated $1.0 million unfavorable impact of currency translation. Income from operations for fiscal 2006 was $11.1 million, an increase of 32 percent compared to income from operations of $8.4 million for fiscal 2005, primarily due to increased gross profit, offset by $0.4 million of stock compensation expense and an estimated $0.5 million unfavorable impact of currency translation.

Non-GAAP Financial Measures

Certain financial results before the impact of stock compensation expense are included in this release as Exhibit A, together with a reconciliation to financial results after the impact of such expenses. This reconciliation includes financial measures that do not reflect generally accepted accounting principles (GAAP). These non-GAAP financial measures are provided for additional information on the Company’s financial performance and provide better comparability to prior period financial results that did not include stock compensation expense. Investors should consider these non-GAAP financial measures in addition to, not as a substitute for or better than, financial measures prepared in accordance with GAAP.

MTS News Release

Page 4