TORONTO, Dec. 1 /PRNewswire-FirstCall/ - HydraLogic Systems Inc. ("HydraLogic" or the "Company") (TSX.V: HLS, OTC Pink Sheet: HYSYF) today announced the Company's financial operating results for the third quarter and nine months ending September 30, 2008, for which Financial Statements and Management's Discussion & Analysis have been filed on www.sedar.com.

During the third quarter, HydraLogic and its subsidiaries produced revenues of $2,085,820 and through strategic consolidation of its business operations continue to record significant year-over-year advancements in bottom line growth.

    Period ending September 30th
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    Consolidated       3 months 3 months      %   9 months 9 months      %
     Results             ending   ending   Change   ending   ending   Change
    (Thousands of CDN$)    2008     2007              2008     2007
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    Total Revenue         2,086    2,282    -8.6%    6,126    5,839    +4.9%
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    Gross Profit          1,293    1,171   +10.4%    3,631    3,125   +16.2%
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    EBITDA(1)              (175)    (374)  +53.2%     (234)  (1,303)  +82.0%
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    Net Income (loss)      (298)    (564)  +47.2%     (484)  (1,873)  +74.2%
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    (1) Earnings before income taxes, depreciation and amortization

In the nine months ending September 30, 2008, significant improvements over the first nine months of 2007 were achieved: revenues increased by 4.9%; gross profit was up 16.2%; EBITDA improved 82%; and the total net loss for the period was cut by 74.2%.

"Cutting the net loss by $1,389,000 in the nine months, when revenues increased only by $287,000, is a dramatic result and clearly demonstrates the effectiveness of the Company's efforts to reduce operating costs, consolidate operations and optimize revenue creation around high margin reoccurring revenue platforms," explained Michael Beckley, President and Chief Executive Officer of HydraLogic Systems Inc.

Beckley continued, "The effect of a par dollar, Canada to USA, alongside the emergence of the economic slowdown in the US economy in the third quarter, did effect revenue generation in our mosquito control service operations. However, hurricane Ike dropped record rainfall on the greater Houston area at the end of the third quarter which resulted in an explosion in the mosquito population. As a result we had record installation and service revenues in both October and November which will bode well for this division's fourth quarter performance."

Commenting on the economy, market conditions and the Company's outlook, Beckley offered, "We have taken steps to maintain working capital liquidity during these very uncertain times and we are confident that HydraLogic will continue on its path of steady growth and improved operational performance in the fourth quarter. Additionally, our earlier investment in well established dealer and service companies is proving to be a successful vehicle for sales of our proprietary technologies and the foundation for our company to persist and prosper into 2009 in spite of the wider economic forecasts."

About HydraLogic Systems Inc.

HydraLogic is an innovator of engineered misting systems and proprietary environmental chemistries with reoccurring revenue distribution platforms. The company strives to be market leaders in providing technologies, though turnkey distribution and service models into the multi-billion dollar mosquito and odour control industries as Bug Defence and HLS Ecolo respectively.

HydraLogic Systems Inc. is listed for trading on the TSX Venture Exchange under the symbol "HLS."

    Forward-Looking Statements
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This press release contains certain "forward-looking statements". These statements relate to future events or future performance and reflect expectations and belief regarding growth, results of operations, performance, business prospects, opportunities or industry performance and trends. These forward-looking statements reflect current internal projections, expectations or beliefs and are based on information currently available. A number of factors could cause actual events or results to differ materially from the results discussed in the forward looking statements. Although it is believed that the forward-looking statements contained in this press release are based upon reasonable assumptions, investors cannot be assured that actual results will be consistent with these forward-looking statements. These forward-looking statements are made as of the date of this press release, and HydraLogic Systems Inc. assumes no obligation to update or revise them to reflect new events or circumstances, except as required pursuant to applicable securities laws.

    The TSX Venture Exchange does not accept responsibility for the adequacy
    or accuracy of this news release.

SOURCE HydraLogic Systems Inc.