Southwall Announces Profitable 2007; Focus on Energy Conservation Products

Year end 2007 revenue was $37.7 million as compared to $40.2 million in 2006, a 6% decrease. The decrease was primarily due to a decline in revenue relating to Plasma Display products, which was partially offset by revenue increases for Automotive and Window Film products that improve energy efficiency in cars and buildings.

Fourth quarter 2007 net income was $2.6 million, or earnings per fully diluted share of $0.08, as compared with a net loss of $75 thousand, or a loss of $0.01 per fully diluted share, in the fourth quarter of 2006. Year end 2007 net income was $3.6 million, significantly higher as compared to a loss of $5.5 million for the year ending 2006. Year end 2007 earnings per fully diluted share were $0.11, as compared to earnings per fully diluted share of ($0.22) for the year ending 2006. The increase was primarily due to lower operating expenses, a sales termination settlement agreement with a large plasma display customer, other income from a Technology Transfer and Service Agreement, and a shift in product mix toward higher margin energy conservation products.

"2007 was a turnaround year for Southwall," said Dennis Capovilla, Southwall's President. "We reduced operating expenses across the company, exited unprofitable business segments, and realigned management accordingly to focus on growth. As demand for and interest in energy conservation continues to increase in importance globally, we believe that Southwall is now in a better position to respond to the growing opportunity for products that improve energy efficiency."

About Southwall Technologies Inc.

Southwall Technologies Inc. is recognized as an innovator in the development and manufacture of high performance, energy-saving films and glass products that dramatically improve the energy efficiency of architectural and automotive glass. Southwall is an ISO 9001:2000-certified manufacturer with customers in over 25 countries around the world, including Audi, BMW, DaimlerChrysler, Guardian, Peugeot-Citroen, Philips, Pilkington, Renault, Saint-Gobain Sekurit, and Volvo.