"We're pleased with the 45% increase in quarterly revenue growth that Hudson achieved," said Marty Cunningham, Hudson's Chairman and Chief Executive Officer. "We are completing the integration of our new businesses which has impacted our results, and continue to seek opportunities to add seasoned producers and/or complementary business lines. Our loss is largely attributable to costs driven by our expansion."

                                     Three Months Ended                                          June 30,                                  ------------------------          (unaudited)                 2009         2008                                  -----------   ----------   Sales and trading                5,909,380    3,517,887   Commissions and fees            $5,594,288   $4,245,453   Interest and other income          173,434      300,353                                  -----------   ----------   Total revenues                 $11,677,102   $8,063,693                                  -----------   ----------    Net loss                       $(1,099,158)   $(842,654)                                  ===========    =========   Basic and diluted EPS               $(0.02)      $(0.02)                                  ===========    =========    

Total revenues increased 45% for the three months ended June 30, 2009, to approximately $11.7 million from $8.1 million during the same period in the prior fiscal year. Sales and trading increased 68% for the three months ended June 30, 2009, to approximately $5.9 million from $3.5 million during the same period in the prior fiscal year, due to improving market conditions and new business lines. Commissions and fees revenues increased 32% for the three months ended June 30, 2009, to approximately $5.6 million from $4.2 million during the same period in the prior fiscal year, primarily due to an expansion of our institutional sales effort.

The pre-tax loss was $1.0 million for the three months ended June 30, 2009, as compared to a $1.3 million pre-tax loss during the same period in the prior year, was a result of the $3.6 million increase in revenue offset by a $3.3 million increase in expenses, primarily as a result of a $2.8 million increase in variable costs (commissions, execution, and clearing costs) and a $.3 million increase in Communications, due to an increase in the number of institutional sales traders. Recruitment and retention costs (including stock-based compensation) was approximately $.7 million for the three months ended June 30, 2009, compared to $0.9 million for the same period in the prior fiscal year. Income taxes provision of $0.1 million for the three months ended June 30, 2009, as compared to a benefit of $0.5 million during the same period in the prior year, included a current period increase in the deferred tax valuation allowance.