Operating income increased in the third quarter to $21.6 million this year from $11.5 million last year. Cash flow from operations was $49.5 million in the quarter.

Nine-month Results

For the nine months ended June 30, 2009, sales increased to $735.9 million from $645.9 million last year. Net income increased by 50 percent to $43.3 million for the nine-month period, or $1.62 per share, compared to last year's net income of $28.8 million, or $1.08 per share. Operating income for the first nine months increased to $64.6 million this year from $42.4 million in 2008. Cash flow from operations was $134.6 million in the nine-month period.

The earnings of $1.62 per share for the nine-month period exceeded the Company's record high earnings for a full twelve-month period of $1.56 per share in fiscal year 2007.

Backlog

Total backlog increased to $2.116 billion at June 30, 2009 from $1.772 billion at September 30, 2008. Transportation systems backlog increased $199 million and defense backlog increased $145 million during the first nine months of the year. The acquisition of a transportation systems service operation in July 2009 will increase transportation systems backlog in the fourth quarter by more than $100 million.

Liquidity

The company again improved its strong liquidity position during the third quarter, and ended the period with $227.6 million in cash.

Cubic Corporation is the parent company of two major business segments: defense and transportation. The Cubic Defense group is a world leader in realistic combat training systems, mission support services and defense electronics. Cubic Transportation Systems is a leader in the design and manufacture of automated fare collection systems and services for public transit authorities worldwide. For more information about Cubic, see the company's Web site at www.cubic.com.

In addition to historical matters, this release contains forward-looking statements which are made pursuant to the safe harbor provisions of the Securities Litigation Reform Act of 1995. These forward-looking statements involve predictions of future results. Investors are cautioned that forward-looking statements involve risks and uncertainties which may affect the Company's business and prospects. These include the effects of politics on negotiations and business dealings with government entities, economic conditions in the various countries in which the Company does or hopes to do business, competition and technology changes in the defense and transit industries, and other competitive and technological factors.

Any statements about the Company's expectations, beliefs, plans, objectives, assumptions or future events or future financial and/or operating performance are not historical and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as "may," "will," "anticipate," "estimate," "plan," "project," "continuing," "ongoing," "expect," "believe," "intend," "predict," "potential," "opportunity" and similar words or phrases or the negatives of these words or phrases. These statements involve estimates, assumptions and uncertainties.

Since actual results or outcomes may differ materially from those expressed in any forward-looking statements made by the Company, investors should not place undue reliance on any forward-looking statements. In addition, past financial and/or operating performance is not necessarily a reliable indicator of future performance and investors should not use the Company's historical performance to anticipate results or future period trends. Further, any forward-looking statement speaks only as of the date on which it is made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time, and it is not possible for the Company to predict which factors will arise. In addition, the Company cannot assess the impact of each factor on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.

                             CUBIC CORPORATION           CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED)               (amounts in thousands, except per share data)                                   Nine Months Ended    Three Months Ended                                       June 30,              June 30,                                   2009       2008       2009       2008                                 ---------  ---------  ---------  --------- Net sales    Products                     $ 382,065  $ 360,362  $ 135,338  $ 130,266    Services                       353,836    285,532    112,839    102,626                                 ---------  ---------  ---------  ---------                                   735,901    645,894    248,177    232,892 Cost and expenses    Products                       280,481    280,258     98,766    104,661    Services                       299,017    240,695     95,524     86,922    Selling, general and     administrative                 85,958     75,740     29,895     26,865    Research and development         5,857      6,752      2,343      2,969                                 ---------  ---------  ---------  ---------                                   671,313    603,445    226,528    221,417                                 ---------  ---------  ---------  --------- Operating income                   64,588     42,449     21,649     11,475 Other income (expenses):    Interest and dividends           1,256      5,047        398      2,254    Interest expense                (1,622)    (2,227)      (595)      (836)    Other income                     1,536        334      1,006          6    Minority interest in loss     of subsidiary                       -       (103)         -       (221)                                 ---------  ---------  ---------  --------- Income before income taxes         65,758     45,500     22,458     12,678 Income taxes                       22,450     16,700      7,550      4,200                                 ---------  ---------  ---------  --------- Net income                      $  43,308  $  28,800  $  14,908  $   8,478                                 =========  =========  =========  ========= Basic and diluted net income  per common share               $    1.62  $    1.08  $    0.56  $    0.32                                 =========  =========  =========  ========= Dividends per common share      $    0.09  $    0.09  $       -  $       -                                 =========  =========  =========  ========= Average number of common  shares outstanding                26,730     26,725     26,732     26,724                                 =========  =========  =========  =========                             CUBIC CORPORATION                   CONSOLIDATED CONDENSED BALANCE SHEETS                               (in thousands)                                                June 30,      September 30,                                                  2009            2008                                               (Unaudited)  (See note below)                                             --------------  -------------- ASSETS Current assets:    Cash and cash equivalents                $      227,630  $      112,696    Accounts receivable - net                       226,433         268,884    Inventories - net                                56,782          45,118    Deferred income taxes and other current     assets                                          42,660          48,630                                             --------------  -------------- Total current assets                               553,505         475,328                                             --------------  -------------- Long-term contract receivables                      10,580          19,930 Property, plant and equipment - net                 49,399          53,887 Goodwill                                            59,267          61,032 Purchased intangibles                               16,525          19,060 Deferred income taxes and other non-current  assets                                             12,179          12,015                                             --------------  --------------                                             $      701,455  $      641,252                                             ==============  ============== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities:    Trade accounts payable                   $       29,344  $       23,288    Customer advances                               118,713          74,963    Other current liabilities                        70,763          85,832    Income taxes payable                              7,988           6,017    Current portion of long-term debt                 4,571           6,045                                             --------------  -------------- Total current liabilities                          231,379         196,145                                             --------------  -------------- Long-term debt                                      20,849          25,700 Other long-term liabilities                         23,565          30,555 Shareholders' equity:    Common stock                                     12,530          12,485    Retained earnings                               445,770         404,868    Accumulated other comprehensive income            3,433           7,570    Treasury stock at cost                          (36,071)        (36,071)                                             --------------  --------------                                                    425,662         388,852                                             --------------  --------------                                             $      701,455  $      641,252                                             ==============  ============== Note: The balance sheet at September 30, 2008 has been derived from the audited financial statements at that date.                             CUBIC CORPORATION         CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)               (amounts in thousands, except per share data)                                   Nine Months Ended    Three Months Ended                                       June 30,              June 30,                                   2009       2008       2009       2008                                 ---------  ---------  ---------  --------- Operating Activities:    Net income                   $  43,308  $  28,800  $  14,908  $   8,478    Adjustments to reconcile net     income to net cash     provided by operating     activities:       Depreciation and        amortization                10,719      6,139      3,871      2,035       Changes in operating        assets and liabilities      80,579     26,647     30,764     26,019                                 ---------  ---------  ---------  --------- NET CASH PROVIDED BY OPERATING  ACTIVITIES                       134,606     61,586     49,543     36,532                                 ---------  ---------  ---------  --------- Investing Activities:    Acquisitions, net of cash     acquired                       (7,886)         -          -          -    Net additions to property,     plant and equipment            (3,894)    (6,799)    (1,284)    (1,935)    Proceeds from sales of     marketable securities               -     66,300          -     10,000    Purchases of marketable     securities                          -    (39,100)         -    (10,000)                                 ---------  ---------  ---------  --------- NET CASH PROVIDED BY (USED IN)  INVESTING ACTIVITIES             (11,780)    20,401     (1,284)    (1,935)                                 ---------  ---------  ---------  --------- Financing Activities:    Principal payments on     long-term borrowings           (5,830)    (5,950)      (136)      (173)    Purchases of treasury stock          -         (2)         -         (2)    Dividends paid                  (2,405)    (2,405)    (2,405)    (2,405)    Other                               45        128          -          -                                 ---------  ---------  ---------  --------- NET CASH USED IN FINANCING  ACTIVITIES                        (8,190)    (8,229)    (2,541)    (2,580)                                 ---------  ---------  ---------  --------- Effect of exchange rates on  cash                                 298       (730)    14,771       (683)                                 ---------  ---------  ---------  --------- NET INCREASE (DECREASE) IN CASH  AND CASH EQUIVALENTS             114,934     73,028     60,489     31,334 Cash and cash equivalents at  the beginning of the period      112,696     73,563    167,141    115,257                                 ---------  ---------  ---------  --------- CASH AND CASH EQUIVALENTS AT  THE END OF THE PERIOD          $ 227,630  $ 146,591  $ 227,630  $ 146,591                                 =========  =========  =========  ========= 

 Media Contact: Jay Thomas 858-505-2989  Investor Contact: Diane Dyer 858-505-2907  

SOURCE: Cubic Corporation

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