BRSI Ballistic Recovery Systems Inc (CE)

Ballistic Recovery Systems, Inc. (PINKSHEETS: BRSI) announced today preliminary unaudited financial results for its fiscal year ended September 30, 2008.

As indicated below, the Company will not file its Annual Report on Form 10-K for the fiscal year ended September 30, 2008.

Larry E. Williams, President and Chief Executive Officer, said, "We are pleased with our fourth quarter and full year performance as well as our ability to achieve consistent growth in revenue. During these extremely challenging market conditions, we are focused on returning to positive EBITDA and operating income and saw significant improvement in FY08 over FY07. We continued to benefit from ongoing market expansion efforts and the addition of new lines of business, as we diversify our revenue base. Labor and operating expenses reflected continuing improvement."

During the last two weeks of the 2008 fiscal year, the Company's largest customer, Cirrus Design, did not take any deliveries of BRS units, contributing to an overall reduction in aviation sales for FY08 as compared to FY07. During the first quarter of 2009 the Company delivered 64 units to Cirrus compared to 184 during the same period in Fiscal 2008, or down 65%. In response to the overall market slowdown, the Company announced significant workforce reductions on November 21, 2008.

Net revenue for the 2008 fiscal year increased 10.9 percent, or $1,025,088, to $10,427,439, compared to $9,402,351 in the prior year. Revenue growth reflected an increase primarily through the safety products line of business through Advanced Tactical Fabrication. Without the Advanced Tactical Fabrication business, net revenue for the Company's remaining segments (general aviation and recreational/sport) would have declined 0.5%.

Operating loss for the year ended September 30, 2008 was ($986,267) compared to ($1,675,729) for the same period last year.

Fiscal 2008 net loss was ($571,178) compared to net loss of ($1,437,123) for Fiscal 2007. The decrease from the prior-year period is primarily attributable to improvement in gross operating margin from 16.0% in fiscal 2007 to 25.0% in Fiscal 2008 as well as improvement in sales, general and administrative expenses.

                BALLISTIC RECOVERY SYSTEMS INC.
                 CONSOLIDATED BALANCE SHEET
                        (unaudited)



                                                  PRELIMINARY
                                                   September    September
                                                    30, 2008     30, 2007
Current assets:
  Cash and cash equivalents                            71,837      914,523
  Accounts receivable                                 728,741    1,317,113
  Inventories                                       2,242,861    1,788,266
  Deferred tax asset -- current portion                80,000       85,000
  Note receivable                                     151,591       56,826
  Prepaid expenses                                    255,664      286,130
  Total current assets                              3,530,694    4,447,858
  Furniture, fixtures and leasehold improvements    5,408,686    1,308,235
  Less accumulated depreciation and amortization     (911,912)    (662,032)
  Furniture, fixtures and leasehold improvements
   - net                                            4,496,774      646,203
Other assets:
  Patents, net of accumulated amortization of
   $12,966 and $11,814, respectively                   50,476          600
  Goodwill                                            173,772            -
  Deferred tax asset -- net of current portion      3,308,732    1,416,000
  Long-term prepaid expenses                                        33,842
  Covenants not to compete                            126,087       16,970
  Total other assets                                3,659,067    1,467,412
Total assets                                       11,686,535    6,561,473

Liabilities And Shareholders? Equity
  Current liabilities:
  Line of credit -- bank                              786,230            -
  Accounts payable                                  1,637,214      776,251
  Customer deposits                                   127,861      104,410
  Accrued payroll                                      52,304       75,939
  Other accrued liabilities                           380,301      294,726
Total current liabilities                           2,983,911    1,251,326
  Long-term debt, less current portion              2,131,219            -
Total Liabilities                                   5,115,130    1,251,326
  Shareholders? equity:
  Common stock                                        113,309      113,048
  Additional paid-in capital                       10,263,937   10,262,357
  Accumulated deficit                              (5,073,997)  (5,065,258)
Total shareholders? equity                          5,303,249    5,310,147

Total liabilities and shareholders? equity         11,686,535    6,561,473




                    BALLISTIC RECOVERY SYSTEMS INC.
                 CONSOLIDATED STATEMENT OF OPERATIONS
         For The Fiscal Year Ended September 30, 2008 and 2007
                             (unaudited)



                                       FY08 TOTAL       FY07       Change
                                       -----------  -----------  ---------

Sales                                  $10,427,439  $ 9,402,351       10.9%
Costs of Sales                         $ 7,820,138  $ 7,901,032       -1.0%
GOM                                    $ 2,607,301  $ 1,501,319       73.7%
GOM (%)                                       25.0%        16.0%      56.6%
Sales, general and administrative      $ 2,875,547  $ 2,620,734        9.7%
Research and Development               $   718,020  $   556,314       29.1%
                                       $ 3,593,568  $ 3,177,048       13.1%

(Loss) from operations                 $  (986,267) $(1,675,729)     -41.1%

Other income and (expense)
Interest Expense                       $   (41,706) $   (35,440)      17.7%
Other income and (expense)             $    49,269  $    33,235       48.2%
Intangible Amortization                $    79,211  $    18,253      334.0%
Impairment of Goodwill                              $   103,774     -100.0%

(Loss) before taxes                    $  (899,493) $(1,555,907)     -42.2%

Tax (Benefit)                          $  (328,315) $  (118,784)     176.4%
Net Income                             $  (571,178) $(1,437,123)     -60.3%

BRS also announced today that it intends to file a Form 15 with the Securities and Exchange Commission ("SEC") to voluntarily deregister its common stock under the Securities Exchange Act of 1934. BRS expects the Form 15 would become effective within 90 days from filing. As a result of this filing, BRS's obligation to file certain reports and forms with the SEC, including Forms 10-K, 10-Q and 8-K, would be suspended.

The Company expects, but cannot guarantee, that its common stock will continue to be quoted on the Pink Sheets after it is deregistered. The Pink Sheets is a centralized quotation service that publishes market maker quotes for securities primarily through its website, www.pinksheets.com.

The Form 15 filing was approved at a meeting of the Company's Board of Directors on December 11, 2008, after consultation with management and corporate counsel and deliberation regarding the advantages and disadvantages of continuing SEC registration.

In commenting on the decision to deregister, Larry E. Williams, the Company's Chief Executive Officer, stated, "After carefully considering the advantages and disadvantages of continued registration, including the high financial costs associated with preparing and filing periodic reports and other filings with the SEC in comparison to BRS's size; the costs associated with the requirements of the Sarbanes-Oxley Act of 2002; the demands placed on management to comply with SEC reporting obligations, which detract from time available for overseeing the operation of BRS; the limited public trading volume of BRS's common stock; and the concentrated nature of BRS's public float, the Board of Directors of BRS believes that deregistering is currently in the best interests of the Company and is anticipated to help build long term stockholder value. This action should result in accounting, legal and administrative expense reductions and allow BRS's management to focus its attention, efforts and resources on BRS's operations and revenue growth. At some point in the future we hope to reregister our common stock as a stronger, more diverse company."

BRS intends to continue to issue press releases and make news announcements of important events, such as quarterly financial results, and post them on its website, which may be found at www.brsparachutes.com.

About Ballistic Recovery Systems and Advanced Tactical Fabrication

Based in South Saint Paul, Minnesota, BRS designs, manufactures, and distributes whole-aircraft emergency parachute systems for general aviation and recreational aircraft. ATF (or Advanced Tactical Fabrication), a wholly-owned subsidiary of BRS, designs and manufactures reflective and load-bearing safety vests, and is a leader in the safety apparel and "cut & sew" industry. Since 1981, BRS has delivered more than 29,000 parachute systems to aircraft owners worldwide, including over 3,500 systems on FAA-certificated aircraft such as the Cirrus Design SR20 and SR22 manufactured in Duluth, Minnesota.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are often, but not always, made through the use of words such as "anticipates," "expects," "plans," "believes," "intends," and other similar words or phrases. These statements are only predictions, and are based on current information and expectations. Such statements involve a number of risks and uncertainties, including market fluctuations, pricing, procurement, manufacturing efficiencies, operating risks, and other risks that could cause the actual results to differ materially from those projected. For more information, review the Company's previous filings with the Securities and Exchange Commission. All forward-looking statements are qualified in their entirety by this cautionary statement, and BRS undertakes no obligation to revise or update this press release to reflect events or circumstances after the date hereof.

CONTACT: Gary D. Moore Email Contact Larry E. Williams Email Contact Voice: 651-457-7491 FAX: 651-457-8651