Highlights:

- MTI Global reports 11.9% increase in revenue to $71.2 million for the year

- Aerospace sales were 24.3% ahead of prior year's sales

- European sales slowed due to customer delays and general industry downturn

- N.A. Silicone performance negatively impacted by continuing contraction of U.S. automotive market

- MTI Global takes long-lived asset impairment charge at Leewood of $4.1 million

- Net loss for the year of $18.1 million, or $0.65 per share of which $13.2 million was non-cash

- MTI Global entered into a binding asset purchase and sale agreement with Connecticut-based Rogers Corporation to sell the majority of the assets of Leewood and the N.A. Silicone Richmond, Virginia plant.

President and Chief Executive Officer, Bill Neill, commented: "MTI Global's results for 2008 were below expectations. While we achieved revenue improvements across all divisions, primarily, due to an increase in volume in Aerospace, more favourable exchange rates, and the acquisition of Mold-Ex, nevertheless profitability was adversely affected by significant non-cash charges."

Mr. Neill continued, "In addition, MTI Global's profitability was impacted by significant non-cash charges including goodwill impairment, long-lived asset impairment, and subordinated debt financing and warrant repricing charges.

"In N.A. Silicone, sales of MagniFoam, the principal product at our Richmond, Virginia plant were ahead of expectations. However, the Milton, Florida location suffered sales declines caused by the downturn in the automotive industry. The consolidation of the Buchanan plant into the Milton and Richmond plants was completed in September 2008."

"In Europe, although Leewood sales in dollars increased by 4.8% in 2008, the change in the Euro produced a 5.9% improvement over the same period. Leewood's performance was negatively impacted by significant customer delays on the Airbus A380. Furthermore, the decline across general European industry dampened performance. Sterne posted a profit in 2008 owing to improved sales of 18.1%. Sales increased across all sources including clean room manufacturing, general manufacturing, and distribution sales," he added.

 Sales:                                                           2008        2007 --------------------------------------------------------------------------- --------------------------------------------------------------------------- Polyfab  Aerospace                                            $  27,980   $  22,514  Fabricated Products                                      3,275       5,004 --------------------------------------------------------------------------- Total Polyfab                                            31,255      27,518 Silicone  N.A. Silicone                                           22,171      19,691  Leewood                                                 12,523      11,951  Sterne                                                   5,253       4,447 --------------------------------------------------------------------------- Total                                                 $  71,202   $  63,607 --------------------------------------------------------------------------- --------------------------------------------------------------------------- Income (Loss) Before Income Taxes and  Non-controlling Interest:                                                            2008        2007 --------------------------------------------------------------------------- Polyfab                                               $    (287)  $    (724) N.A. Silicone                                            (2,057)       (841) Leewood                                                  (8,286)     (3,548) Sterne                                                       80         260 Corporate                                                (7,568)     (3,016) --------------------------------------------------------------------------- Total                                                 $ (18,118)  $  (7,869) --------------------------------------------------------------------------- --------------------------------------------------------------------------- 

Three Month Results:

Revenue for the three months ended December 31, 2008 was $18.0 million representing an increase of 13.9% over 2007.

Aerospace sales were $7.7 million, representing an increase of $2.5 million or approximately 47.2% over 2007. This included an increase of approximately $1.3 million due to the higher U.S. dollar compared to a year ago. Fabricated Products' sales of $0.6 million were $0.9 million or approximately 58.5% lower than the prior year. The decrease is primarily due to greater than anticipated decline in sales to the automotive and sporting goods markets.

N.A. Silicone sales were $5.3 million, approximately 3.2% lower than last year's sales of $5.5 million. This includes an increase of approximately $1.0 million due to the higher U.S. dollar. The sales decline is primarily due to the slowdown in U.S. automotive sales.

Leewood sales of $2.8 million were $0.3 million higher than prior year. Approximately $0.3 million of the increase was due to the higher Euro this year compared to a year ago.

Sterne sales of $1.6 million were $0.6 million higher than prior year due to increased sales across all revenue sources, including clean room manufacturing, general manufacturing and distribution sales. This includes an increase of approximately $0.2 million due to the increase in the Euro.

MTI Polyfab's income before income taxes in the fourth quarter was $756,000 compared to a loss of $849,000 in the prior year. The improvement is due to reduced costs associated with the outsourcing of Aerospace manufacturing to Mexico, redundant costs associated with maintaining operations in Canada and additional labour charges to reduce backlog. N.A. Silicone's loss of $570,000 was higher than last year's loss of $563,000 due to excess labour and overhead costs as a result of the consolidation of N.A. Silicone. Leewood's loss of $4.6 million was higher than prior year's loss of $3.0 million primarily due to long-lived asset impairment charges in 2008 of $4.1 million offset by an increase in technical and sales personnel to support aerospace programs, long-lived asset impairment and amortization of deferred charges. Sterne's income of $48,000 was higher than prior year's loss of $93,000 primarily due to an increase in sales volume.

The net loss for the fourth quarter of fiscal 2008 was $6.1 million or $0.23 per share compared to a loss of $5.2 million or $0.19 per share for the same period in 2007.

Year End Results

Revenue for the year ended December 31, 2008 was $71.2 million, an increase of approximately 11.9% compared to revenues of $63.6 million for the year ended December 31, 2007. Revenue in 2008 includes an increase of approximately $870,000 due to the impact of currency fluctuations.

Aerospace sales were $28.0 million for fiscal 2008, well ahead of last year's sales of $22.5 million. This is despite sales being reduced by approximately $0.1 million due to the lower U.S. dollar compared to exchange rates in effect last year.

Fabricated Products sales were $3.3 million, a decrease of approximately 34.6% compared to the previous year. The decrease in fiscal 2008 was primarily due to a decline in sales to the automotive and sporting goods market.

N.A. Silicone sales of $22.2 million in fiscal 2008, an increase of $2.5 million or approximately 12.6% compared to sales of $19.7 million for the fiscal 2007. The increase was generated from the acquisition of the silicone division of Mold-Ex (acquired in July 2007). These sales were offset by $0.1 million as a result of the effect of the lower U.S. dollar compared to exchange rates in 2007 and lower transit seating sales, as well as a decline in sales to the U.S. automotive market.

Leewood sales of $12.5 million for the year ended December 31, 2008 were $572,000 or approximately 4.8% higher than last year's sales of $11.9 million. This includes an increase of approximately $707,000 due to the increase in the Euro offset by a general slowdown in the European economy.

Sterne sales of $5.3 million for the year ended December 31, 2008 were $806,000 higher than last year's sales of $4.5 million due to increased sales across all revenue sources, including clean room manufacturing, general manufacturing and distribution sales. This includes an increase of approximately $321,000 due to the increase in the Euro.

Of total 2008 sales, Aerospace accounted for 39.3%, N.A. Silicone accounted for 31.1%, Leewood 17.6%, Sterne 7.4%, and Fabricated Products 4.6%.

Total operating expenses for the year ended December 31, 2008 of $19.4 million were $3.8 million, higher than in the same period in 2007 and include $3.6 million of restructuring charges attributable to changes in business operations, forbearance and banking arrangements, and the subordinated debt financing.

Plant and laboratory expenses were $2.9 million, approximately $0.8 million or approximately 35.2% higher than in the same period last year. The increase was due to additional operating expenses as a result of the acquisition of Mold-Ex, additional research staff in Leewood, and Polyfab costs associated with the Mexican contract manufacturing operation.

Sales and marketing expenses were $6.2 million, approximately $0.8 million or approximately 14.8% higher than in the same period last year due to the acquisition of Mold-Ex and higher personnel costs in Leewood attributed to adding experienced personnel.

Administrative expenses of $7.6 million increased $0.4 million, or approximately 6.2% from the same period last year. The increase is primarily due to the acquisition of Mold-Ex, an increase in professional fees and an increase in the allowance for bad debts as a result of the continued decline in the economy. During fiscal 2008, the Company incurred restructuring costs of $3.6 million primarily related to the consolidation of the Company's N.A. Silicone plants from three locations into two, forbearance and banking arrangements, and the subordinated debt financing.

As at September 30, 2008, due to changes in economic circumstances and the performance of Company, the Company assessed the fair value of all the operating segments to which underlying goodwill is attributed. As a result of this assessment, the Company determined that there had been an impairment in the carrying value of N.A. Silicone's and Leewood's goodwill and, accordingly, a $3.4 million write down was recorded.

The net loss for the year ended December 31, 2008 was $18.1 million, or $0.65 per share compared to a net loss of $8.1 million, or $0.29 per share compared to last year.

As at December 31, 2008, the Company had working capital of $1.1 million, including cash and cash equivalents, plus restricted cash totaling $0.8 million, compared with $5.8 million at December 31, 2007. Despite an increase in current assets through revenue growth, working capital has decreased due to an increase in bank indebtedness, and accounts payable used to finance operations and subordinated debt.

The Company has a demand line of credit, with a maximum of $6.0 million. The demand line of credit is subject to working capital limits, bearing interest at the Bank's prime rate plus 2.00%. The effective rate at December 31, 2008 was 5.50%. As part of the Bank's facility agreement for the demand line of credit, certain subsidiaries of the Company have provided a general security agreement and collateral security over substantially all assets of Polyfab and N.A. Silicone. The amount of bank indebtedness outstanding at December 31, 2008 was $5.9 million compared with $6.0 million at December 31, 2007.

Financial Covenant Update:

As previously disclosed, the Company entered into a new agreement with its Bank dated June 3, 2008. Under the terms of the new agreement, similar financial and general covenants and more restrictive reporting requirements have been placed on the Company. The Company signed a waiver of its second quarter breach of financial and general covenants with its Bank and Lender on August 15, 2008. Under the terms of the waiver, the Company agreed to additional general covenants and to amend the pricing of the warrants issued in connection with the June 3, 2008 financing. The Company signed an amended waiver on October 21, 2008, that included amendments to the general covenants in the original waiver.

The Company is in breach of financial and general covenants with the Bank and the Lender.