PLYMOUTH, Wis., May 14, 2008 (GLOBE NEWSWIRE) -- Orion Energy Systems, Inc. (Nasdaq:OESX), a leading provider of energy management systems to the commercial and industrial sectors, today announced financial results for the fourth quarter and fiscal year ended March 31, 2008.

Orion ended its fiscal year with record results, with revenues increasing 67% to $80.7 million versus $48.2 million in fiscal 2007. Net income increased by $3.5 million to $4.4 million compared to $929,000 in fiscal 2007. Earnings per diluted share were $0.19 versus $0.05 in fiscal 2007, an increase of 280%.

"The demand for Orion's end-use energy efficiency solutions is clearly reflected in our strong top-line growth during fiscal 2008. While we have made great strides in the last year, we have significant runway for continued improvements through solid sales execution and increased operational efficiencies," commented Neal Verfuerth, CEO of Orion Energy Systems. "Heading into fiscal 2009, we believe that our leading technology, proven return on investment, and track record of performance by our sales and implementation team position us to achieve our 50% annual revenue growth target."

Fiscal 2008 Fourth Quarter Results

Revenue. Total revenue for the fourth quarter of fiscal 2008 increased 55% to $22.3 million versus $14.3 million for the fiscal 2007 fourth quarter.

Gross Profit. Gross profit for the fourth quarter of fiscal 2008 increased 72.9% to $8.0 million compared to $4.7 million for the fiscal 2007 fourth quarter.

Operating Expenses. Total operating expenses for the fiscal 2008 fourth quarter were $6.5 million compared to $4.1 million for the fiscal 2007 fourth quarter.

Income from Operations. Operating income increased 190% to $1.6 million for the fiscal 2008 fourth quarter versus $0.5 million for the fiscal 2007 fourth quarter.

Net Income. Net income was $1.5 million for the fiscal 2008 fourth quarter compared to $0.4 million for the fiscal 2007 fourth quarter. Earnings per diluted share were $0.05 for the fiscal 2008 fourth quarter versus $0.01 for the fiscal 2007 fourth quarter.

Fiscal 2008 Year-End Results

Revenue. Total revenue for fiscal 2008 increased 67% to $80.7 million compared to $48.2 million for the year ended March 31, 2007.

Gross Profit. Fiscal 2008 gross profit was $28.2 million, an increase of 79.8% compared to $15.7 million for the year ended March 31, 2007. Gross profit margins increased to 35.0% from 32.6% in fiscal 2007.

Operating Expenses. Total operating expenses were $20.9 million for fiscal 2008 versus $13.7 for the year ended March 31, 2007. Operating expenses increased 52% year over year.

Income from Operations. Income from operations for fiscal 2008 increased 269% to $7.4 million compared to $2.0 million for the year ended March 31, 2007.

Net Income. Net income increased 375% to $4.4 million for fiscal 2008 compared to $0.9 million for fiscal 2007. Earnings per diluted share for fiscal 2008 were $0.19, which favorably compared to $0.05 for the year ended March 31, 2007.

Cash. As of March 31, 2008, Orion had cash and cash equivalents totaling $78.3 million, an increase of $78.0 million since March 31, 2007, primarily due to Orion's initial public offering in December 2007.

Business Highlights

 * Deployed energy management systems in 957 facilities in fiscal
   2008, bringing Orion's installed base to 3,655 facilities.

 * Further improved the efficiency and effectiveness of Orion's
   sales force through deployment of advanced technologies and
   innovative sales management processes.

 * Increased the ratio of revenue per salesperson to $1.7 million in
   fiscal 2008 from $1.1 million in fiscal 2007, while concurrently
   reducing sales and marketing expense as a percentage of revenue
   to 10.9% in fiscal 2008 from 13.4% in fiscal 2007.

 * Launched grass roots marketing campaign aimed at building out our
   wholesale channel network.

 * Completed manufacturing plant upgrades and reconfiguration, which
   will support a significant increase in Orion's revenue run rate
   with modest additional capital expenditures.

 * New customer additions in fiscal 2008 resulted in $34 million in
   annual saved energy costs and an annual reduction in indirect CO2
   emissions from energy savings by 306,000 tons. Since December
   2001, the Company has benefited its customers and the environment
   as follows:
                                             Cumulative From 
                                             December 1, 2001
                                                 Through 
                                              March 31, 2008
 ------------------------------------------------------------
 High intensity fluorescent (HIF) 
  systems sold                                      1,133,000
 ------------------------------------------------------------
 Total units sold (including HIF)                   1,465,000
 ------------------------------------------------------------
 Customer kilowatt demand reduction                   334,000
 ------------------------------------------------------------
 Customer kilowatt hours saved                  4,563,331,000
 ------------------------------------------------------------
 Customer electricity costs saved              $  351,376,000
 ------------------------------------------------------------
 Indirect carbon dioxide emission
  reductions from customers' energy
  savings (tons)                                    4,449,000
 ------------------------------------------------------------
 Square footage retrofitted                       586,763,000
 ------------------------------------------------------------

Conference Call

Orion will host a conference call on Wednesday, May 14, at 5:30 p.m. Eastern (4:30 p.m. Central/2:30 p.m. Pacific) to discuss details regarding its fiscal 2008 fourth quarter and year-end performance. Domestic callers may access the earnings conference call by dialing 877-681-3374 (International callers, dial 719-325-4943). Investors and other interested parties may also go to the Investor Relations section of Orion's website at http://investor.oriones.com/events.cfm for a live webcast of the conference call. To ensure a timely connection, it is recommended that users register at least 15 minutes prior to the scheduled webcast.

Orion Energy Systems, Inc. (Nasdaq:OESX) is a leading power technology enterprise that designs, manufactures and implements energy management systems, consisting primarily of high-performance, energy efficient lighting systems and controls and related services, for commercial and industrial customers without compromising their quantity or quality of light.

The Orion Energy Systems, Inc. logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=4540

Safe Harbor Statement

Certain matters discussed in this press release are "forward-looking statements" intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements may generally be identified as such because the context of such statements will include words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," "will," "would" or words of similar import. Similarly, statements that describe future plans, objectives or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties that could cause results to differ materially from those expected, including, but not limited to, the following: (i) Orion's ability to compete in a highly competitive market and its ability to respond successfully to market competition; (ii) the market acceptance of Orion's products and services; (iii) price fluctuations, shortages or interruptions of component supplies and raw materials used to manufacture Orion's products; (iv) loss of one or more key customers or suppliers; (v) a reduction in the price of electricity; (vi) the cost to comply with, and the effects of, any current and future government regulations, laws and policies; (vii) increased competition from government subsidiaries and utility incentive programs; (viii) dependence on customers' capital budgets for sales of products and services; (ix) Orion's ability to effectively manage its anticipated growth; and (x) potential warranty claims. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are made only as of the date of this press release and Orion undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise. More detailed information about factors that may affect our performance may be found in our filings with the Securities and Exchange Commission, which are available at http://www.sec.gov or at http://www.oriones.com in the Investor Relations section of our website.

              ORION ENERGY SYSTEMS, INC. AND SUBSIDIARIES
                    SELECTED FINANCIAL INFORMATION
          (in thousands, except share and per share amounts)

            Condensed Consolidated Statements of Operations
    For the Three Months and Fiscal Years ended March 31, 2007 and 2008
                              (unaudited)

                       Three months ended        Fiscal year ended
                            March 31,                 March 31,
                    ------------------------  ------------------------
                        2007        2008         2007         2008
                    -----------  -----------  -----------  -----------
 Revenue            $    14,309  $    22,250  $    48,183  $    80,687
 Cost of revenue          9,654       14,203       32,487       52,462
                    -----------  -----------  -----------  -----------
  Gross profit            4,655        8,047       15,696       28,225
                    
 Operating
  expenses:
 General and
  administrative          1,943        3,434        6,162       10,200
 Sales and
  marketing               1,782        2,523        6,459        8,832
 Research and
  development               381          498        1,078        1,832
                    -----------  -----------  -----------  -----------
   Total
    operating
    expenses              4,106        6,455       13,699       20,864
                    -----------  -----------  -----------  -----------
  Income from
   operations               549        1,592        1,997        7,361
 Other income
  (expense):
 Interest expense          (270)        (118)      (1,044)      (1,390)
 Dividend and
  interest income           173          709          201        1,189
                    -----------  -----------  -----------  -----------
   Total other
    income
    (expense)               (97)         591         (843)        (201)
                    -----------  -----------  -----------  -----------
  Income before
   income tax               452        2,183        1,154        7,160
 Income tax
  expense                    88          727          225        2,750
                    -----------  -----------  -----------  -----------
   Net income               364        1,456          929        4,410
 Accretion of
  redeemable
  preferred stock
  and preferred
  stock dividends           (76)          --         (201)        (225)
 Conversion of
  preferred stock           (83)          --          (83)          --
 Participation
  rights of
  preferred stock
  in undistributed
  earnings                  (71)          --         (205)        (775)
                    -----------  -----------  -----------  -----------
   Net income
    attributable
    to common
    shareholders    $       134  $     1,456  $       440  $     3,410
                    ===========  ===========  ===========  ===========
 Basic net income
  per share
  attributable to
  common
  shareholders      $      0.01  $      0.05  $      0.05  $      0.22
 Weighted-average
  common shares
  outstanding         9,247,666   26,952,215    9,080,461   15,548,189
 Diluted net
  income per share
  attributable to
  common
  shareholders      $      0.01  $      0.05  $      0.05  $      0.19
 Weighted-average
  common shares
  and share
  equivalents
  outstanding        16,997,070   30,070,210   16,432,647   23,453,803

 Supplemental
  information:
   FAS 123R
    compensation
    expense
     Cost of
      revenue       $        13  $        54  $        24  $       122
     General and
      administrative         69          287          154          852
     Sales and
      marketing              77          108          153          375
     Research and
      development            19           13           32           42
                    -----------  -----------  -----------  -----------
       Total        $       178  $       462  $       363  $     1,391
                    ===========  ===========  ===========  ===========
    Cash incentive
     compensation
     related to
     completion
     of initial
     public
     offering
     included in
     general and
     administrative
     expenses       $        --  $        --  $        --  $       742



                Condensed Consolidated Balance Sheets 
        As of March 31, 2007 and March 31, 2008 (unaudited)

                                          March 31,    March 31, 
                                            2007         2008
                                          ---------    ---------
 Cash and cash equivalents                $     285    $  78,312
 Current assets                              22,619      116,896
 Property and equipment, net                  7,588       11,539
 Total assets                                33,583      130,072
 Current liabilities                          8,539       12,606
 Long term debt                              10,603        4,473
 Total temporary equity and 
  shareholders' equity                       14,308      113,190


                Condensed Consolidated Statements of Cash Flows 
              For the fiscal years ended March 31, 2007 and 2008
                              (unaudited)

                                            Fiscal year ended 
                                                 March 31,
                                          ----------------------
                                             2007         2008
                                          ---------    ---------
 Cash used in operating activities        $  (6,234)   $  (1,362)
 Cash used in investing activities             (969)      (7,437)
 Cash provided by financing activities        6,399       86,826
 Net increase (decrease) in cash and 
  cash equivalents                             (804)      78,027

CONTACT:  Orion Energy Systems, Inc. 
          Erik G. Birkerts, VP Strategy & Corporate Communications
          (920) 482-1924

          FD Ashton Partners
          Victoria Paris
          (312) 553-6715