PPIH Perma Pipe International Holdings Inc

MFRI, Inc. (NASDAQ NM: MFRI) � Today MFRI announced record sales and earnings for the quarter ended April 30, 2009. Net sales were $68.0 million, up 2.4% from $66.0 million in the corresponding quarter of the prior year. Net income rose to $6.0 million or $0.88 earnings per share, versus net income of $423 thousand or $0.06 per share, for the prior-year�s quarter.

SALES -- Net sales for the first quarter compared to prior-year�s quarter for the piping systems business increased by $2.0 million, the filtration products business decreased by $2.5 million, and the industrial process cooling equipment business decreased by $4.0 million. The HVAC business, included in corporate and other, increased sales by $6.2 million as work continued on projects. Net sales increased primarily due to the growing success of the piping systems business in the United Arab Emirates (�U.A.E.�), progress on the crude oil pipeline project in India and the growth in field work on buildings in the heating, ventilation and air conditioning (�HVAC�) backlog.

GROSS PROFIT -- Gross profit for the quarter increased to 27.7% of sales from 16.9% in the prior year. Due to the increased net sales, first quarter 2009 gross profit of $18.7 million was 68.1% higher than 2008 first quarter gross profit of $11.1 million.

INDIA PIPELINE PROJECT -- As previously announced, the piping systems business is performing the insulating and jacketing services for a 600 kilometer (370 mile), 600 millimeter (24 inch) diameter heat-traced crude oil pipeline. This work is being performed at a facility in Mundra, India. As of April 30, 2009, the Company had successfully completed over 95% of the production on this contract.

EXPENSES -- General and administrative expenses increased from 9.5% of sales in the first quarter of 2008 to 13.0% of sales in the corresponding quarter of 2009. This was primarily due to higher profit based incentive compensation, staff and recruiting fees, and additional stock compensation expense.

NET INCOME -- Net income for the quarter was up significantly versus the prior-year�s quarter due to the excellent performance of the piping systems business unit in Fujairah U.A.E., continued production on the India pipeline project and profits from the HVAC business. The income tax accrual is less than the statutory U. S. federal income tax rate mainly due to the impact of tax free foreign income in the U.A.E.

BACKLOG -- The Company�s backlog on April 30, 2009 was $99.6 million, down $8.3 million or 7.6% from the January 31, 2009 year end and down $88.0 million or 46.9% from April 30, 2008. Part of the backlog decline was due to the progress on specific projects such as HVAC for new buildings and the heated oil pipeline in India. Due to current customer financing constraints, there are currently very few opportunities to obtain new HVAC business at this time. Also, the Company would not expect new orders for a project similar to the one in India to be replaced in the 2009 backlog. Additionally, the difficult worldwide economic environment has caused some orders to be postponed or cancelled and has reduced the opportunities to obtain new work. As a favorable sign, quoting activity has been maintained at a reasonably high level but decision making by customers is slow, which management believes is probably due to general financial constraints and caution on expenditures.

David Unger, CEO said, �Our global expansion strategy of manufacturing our products in foreign countries to serve their local markets has resulted in higher sales and earnings for our Company. We continue to seek markets around the world where we can grow our volume and profitability. This also helps us to provide expanded economic opportunities for our people. When the current economic recession ends, we expect the mix of domestic and global sales will continue to support our Company�s growth.�

Brad Mautner, President and COO said, �The unusually strong first quarter profitability was driven by the piping systems business. A year ago, the project in India was not in production and Perma Pipe Middle East had built a substantial order book and was actively scaling up production. During this past quarter, customer delivery requirements and efficient execution in India and the U.A.E. led to strong shipments and increased margins. Likewise the HVAC business is now executing their backlog and contributing to our profitability. Within the filtration and process cooling businesses, the world was very different a year ago. Demand weakened in the second half of 2008 and continues declining into 2009. Not expecting a quick recovery, we are aggressively pursuing sales opportunities and continue to adjust costs, expenses and inventory levels to better match the depressed demand in these markets.�

MFRI, Inc. is a multi-line company engaged in the following businesses: pre-insulated specialty piping systems for oil and gas gathering, district heating and cooling and other applications; custom-designed industrial filtration products to remove particulates from dry gas streams; industrial process cooling equipment to remove heat from molding, printing and other industrial processes; and installation of heating, ventilation and air conditioning for large buildings.

Form 10-Q for the period ended April 30, 2009 will be accessible at http://www.sec.gov/. For more information visit the Company's website www.mfri.com or contact the company directly.

Statements and other information contained in this announcement which can be identified by the use of forward-looking terminology such as "anticipate," "may," "will," "expect," "continue," "remain," "intend," "aim," "should," "prospects," "could," "future," "potential," believes," "plans," "likely," and "probable," or the negative thereof or other variations thereon or comparable terminology, constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934 as amended and are subject to the safe harbors created thereby. These statements should be considered as subject to the many risks and uncertainties that exist in the Company's operations and business environment. Such risks and uncertainties include, but are not limited to, economic conditions, market demand and pricing, competitive and cost factors, raw material availability and prices, global interest rates, currency exchange rates, labor relations and other risk factors.

MFRI, INC. AND SUBSIDIARIES

Condensed Statements of Operations and Related Data

(In $000�s except per share data)

Three Months Ended

April 30,

2009 � 2008 Net sales: Piping Systems $ 32,627 $ 30,677 Filtration Products 23,305 25,817 Industrial Process Cooling Equipment 5,053 9,067 Corporate and Other (1) 6,594 420 Totals 67,579 65,981 Gross profit: Piping Systems 14,148 5,460 Filtration Products 2,646 3,269 Industrial Process Cooling Equipment 1,051 2,392 Corporate and Other (1) 882 22 Totals 18,727 11,143 Income (loss) from operations: Piping Systems 9,952 2,932 Filtration Products (285) 253 Industrial Process Cooling Equipment (495) (40) Corporate and Other (1) (2,300) (2,010) Totals 6,872 1,135 � Income from joint venture 0 99 � Interest expense � net 688 623 � Income before income taxes 6,184 611 � Income tax expense 178 188 � � Net income $ 6,006 $ 423 � � Weighted average number of common shares outstanding - basic 6,816 6,787 Earnings per share - basic net income $ 0.88 $ 0.06 � Weighted average number of common shares outstanding - diluted 6,852 6,888 Earnings per share - diluted net income $ 0.88 $ 0.06 � Backlog (In thousands): 4/30/09 1/31/09 Piping Systems $ 56,742 $ 52,385 Filtration Products 29,432 35,549 Industrial Process Cooling Equipment 3,895 3,835 Corporate and Other (1) � 9,550 � 16,051 Total Backlog $ 99,619 $ 107,820

1) Corporate and Other includes activity for the installation of heating, ventilation and air conditioning systems.

See the Company�s Form 10-Q for notes to financial statements.