Highlights

 --  Continued improvements in Merix' underlying cost structure preserves     cash and liquidity, positioning the company well for an improvement in     business conditions --  Meaningful sequential quarterly gross margin improvement, particularly     in Asia where gross margin improved to 14.3% of revenue --  Significant new customer wins enable share growth in the Test,     Industrial & Medical and Defense & Aerospace end markets --  Ended fiscal year with $17.6 million in cash and cash equivalents --  The existing Bank of America credit facility, combined with the     recently announced China-based credit agreement, increases the company's     unused borrowing availability to $42.6 million, representing an $11.5     million increase compared to the third quarter further strengthening the     company's liquidity position --  Excellent factory performance and further improvement in yields,     quality and customer delivery performance      

Financial Results

The Company reported a net loss of $8.4 million or $0.39 per diluted share on revenue of $58.9 million for the fourth quarter of fiscal 2009, which compares to a net loss of $3.5 million or $0.17 per diluted share on revenue of $87.6 million in the fourth quarter of fiscal 2008.

Included in the fiscal 2009 fourth quarter loss was $3.6 million of non-recurring expense items comprised of the following:

 --  $0.9 million of non-cash impairment charges associated with estimated     future Wood Village facility lease and property tax payments; --  $1.1 million of severance payments related to previously announced     actions; and --  $1.6 million of legal and professional costs primarily related to our     ongoing securities litigation efforts. It is anticipated that the future     quarterly expense rate associated with the securities litigation will be     significantly lower.      

Commenting on the recent fourth quarter performance, Michael D. Burger, President and Chief Executive Officer, said, "Our fourth quarter revenue decreased 3% compared to the third quarter of fiscal 2009 and we believe our demand is at or near the bottom of this economic cycle. Our team has performed exceptionally well given the roughly 30% revenue decline over the past year by reducing costs while continuing to improve operating metrics and support our customer needs. These improvements have reduced our cash break even level to below $60 million of quarterly revenue. At the same time we've continued to increase our liquidity by expanding our existing Bank of America relationship and adding a new China-based credit facility which together increases our overall access to low cost capital."

Mr. Burger continued, "Despite the economic slowdown we believe we are maintaining market share and beginning to win new projects in a number of larger customer programs. These recent wins are a testament that we have the right operational model which customers value. With our stronger liquidity position, we're now refocusing our efforts externally and increasing our intensity to leverage our unique geographic footprint and market position. While we anticipate success, predicting the timing is always a challenge and therefore we currently anticipate first quarter revenues to stabilize and remain relatively flat when compared to the fourth quarter of fiscal 2009."

Merix' overall gross margins improved significantly from the third quarter of fiscal 2009 and averaged 8.5% of revenue for the fourth quarter compared to 10.7% and 1.4% in the fourth quarter of fiscal 2008 and third quarter of fiscal 2009, respectively. The significant margin improvement compared to the third quarter of fiscal 2009 was due to the full-quarter impact of cost reduction actions taken during the first few months of calendar 2009 and the operational improvements achieved over the last several quarters.

Operating expenses, exclusive of impairment, restructuring charges and certain legal and professional expenses associated primarily with our securities litigation process, totaled $8.1 million in the fourth quarter of fiscal 2009 compared to $9.8 million and $8.8 million in the fourth quarter of fiscal 2008 and third quarter of fiscal 2009, respectively. The sequential quarterly expense reduction of $0.7 million was also the result of the full-quarter impact of cost reduction actions taken in the first few months of calendar 2009.

Liquidity

Merix ended the fourth quarter of fiscal 2009 with $17.6 million in cash and cash equivalents, near a 21 month high. Borrowings under the Company's line of credit were unchanged from the third quarter at $8.0 million with $37.3 million of remaining availability under the line. Additionally, on June 29, 2009 Merix announced a new credit agreement with Industrial and Commercial Bank of China that provides an additional $5.3 million of low cost borrowing capacity. Today, total unused and available borrowing capacity equals $42.6 million representing an $11.5 million increase from the third quarter of fiscal 2009.

Conference Call and Webcast Information

Merix will conduct a conference call and live webcast Monday, July 13, 2009 at 2:00 p.m. PT. Management will discuss fourth quarter fiscal 2009 financial results, provide a qualitative discussion regarding our business outlook and comment further on the strategic direction of the Company. To access the webcast, log on to www.merix.com.

An online replay of the webcast will be available at 5:00 pm PT on July 13, 2009 and a telephone replay will be available from 4:00 pm PT on July 13, 2009 until 11:59 pm PT on Monday, July 20, 2009 by calling (320) 365-3844, access code 104349.

Use of Non-GAAP Financial Measures

"Non-GAAP Net Loss excluding Unusual Items" is disclosed in this press release and is a non-GAAP financial measure. Management believes the disclosure of this non-GAAP financial measure, when presented in conjunction with the corresponding GAAP measures, provide useful information to the Company, investors and other users of the financial statements of the underlying operating performance of the company for a given level of net sales. Management believes this measure is important because it reflects financial performance that is unencumbered by certain non-recurring or unusual items. The Company has provided a reconciliation of this measure to GAAP financial information in the attached schedules.

About Merix

Merix is a leading manufacturer of technologically advanced, multilayer, rigid printed circuit boards for use in sophisticated electronic equipment. Merix provides high-performance materials, quick-turn prototype, pre-production and volume production services to its customers. Principal markets served by Merix include communications and networking, computing and peripherals, test, industrial and medical, defense and aerospace, and automotive end markets in the electronics industry. Additional corporate information is available on the internet at www.merix.com.

Forward-Looking Statements

This release contains "forward-looking statements" within the meaning of the Securities Litigation Reform Act of 1995 relating to the Company's business operations and prospects, including statements related to estimates of financial results for future reporting periods that are made pursuant to the safe harbor provisions of the federal securities laws. These forward-looking statements, which may be identified by the inclusion of words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "goals" and other similar expressions, are based on current expectations, estimates, assumptions and projections that are subject to change. Actual results may differ materially from the forward-looking statements. Many factors, including the following, could cause actual results to differ materially from the forward-looking statements: our ability to control or pass through increases in the cost of raw materials and supplies; changes in customer order levels, product mix and inventory build-up; lower than expected or delayed sales; ability to successfully restructure Merix Asia and complete the related capital and technology expansion; the ability to successfully and timely integrate the operations of Merix Asia; continued availability of our line of credit facility or sources of additional capital; the ability to successfully restructure Merix Oregon; fluctuations in demand for products and services of the Company, including quick-turn and premium services; foreign currency risk; the introduction of new products or technologies by competitors; the ability to avoid unanticipated costs, including costs relating to product quality issues and customer warranty claims; pricing and other competitive pressures in the industry from domestic and global competitors; all other risks inherent in foreign operations such as increased regulatory complexity and compliance cost and greater political and economic instability; our ability to fully utilize our assets and control costs; our ability to retain or attract employees with sufficient know-how to conduct our manufacturing processes and maintain or increase our production output and quality; and other risks listed from time to time in the Company's filings with the Securities and Exchange Commission or otherwise disclosed by the Company, including those set forth in the Company's Annual Report on Form 10-K for the year ended May 31, 2008 and Form 10-Q for the third quarter ended February 28, 2009. Merix Corporation does not undertake to update any such factors or to publicly announce developments or events relating to the matters described herein.