DYSL Dynasil Corp of America (CE)

Dynasil Corporation of America (OTCBB:DYSL.OB), announced the results of operations for its second quarter of fiscal year 2009 ended March 31, 2009. Dynasil is a manufacturer of specialized instruments and photonic products including optical materials, components and coatings as well as currently deriving more than fifty percent of its revenue from government funded research. The Company serves a broad range of applications markets in the medical, industrial, and homeland security/ defense sectors.

Revenues for the quarter ended March 31, 2009 nearly tripled to $8.6 million compared to revenues of $3.0 million for the quarter ended March 31, 2008. Income from Operations for the quarter nearly quadrupled to $755,261 compared to $198,208 for the quarter ended March 31, 2008. Net income for the quarter was $404,134, or $0.02 per share, compared with net income of $145,976, or $0.02 per share, for the quarter ended March 31, 2008. For the six months ended March 31, 2009, revenues tripled to $17.4 million, Income from Operations tripled to $1.4 million and Net Income more than doubled to $759,775 as compared to the six months ended March 31, 2008. This is the third quarter since the acquisition of Radiation Monitoring Devices, Inc. and certain assets of RMD Instruments, LLC (together, �RMD�) on July 1, 2008, which was the key driver for the large revenue and profitability increases. Net Operating Loss carry-forwards for federal taxes were exhausted during fiscal year 2008 so fiscal year 2009 net income was impacted by increased federal tax provisions as well as the higher interest costs related to the RMD acquisition.

�Given current economic conditions, we are pleased that we were able to triple revenues and nearly quadruple Income from Operations for the quarter,� said Craig T. Dunham, President and CEO. �The acquisition of RMD has significantly increased Dynasil�s technical capabilities and intellectual property. During the quarter, we made substantial progress in identifying potential products for commercialization and developing additional government funding for those projects. Those potential new products include improved sensors for: medical imaging, non-destructive testing for cracks in metal parts and Homeland Security�s detection of nuclear threats. We are seeing unprecedented levels of government contracting opportunities which appear to be driven by the economic stimulus package. We continue to execute our strategy of significant and profitable growth through organic growth, commercialization of our broad research portfolio and acquisitions.�

About Dynasil: Founded in 1960, Dynasil is a manufacturer of photonic products including optical materials, components, coatings and instruments for a broad range of applications markets in the medical, industrial and defense sectors. Its wholly owned subsidiaries are located in New Jersey, New York and Massachusetts.

This news release may contain forward-looking statements usually containing the words "believe," "expect," �plan,� �target,� �intend� or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act. Future results of operations, projections, and expectations, which may relate to this release, involve certain risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, the factors detailed in the Company's Annual Report or Form 10-KSB and in the Company's other Securities and Exchange Commission filings, continuation of existing market conditions and demand for our products.

� � DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ASSETS March 31, September 30, 2009 2008 (Unaudited) � Current assets Cash and cash equivalents $ 1,439,157 $ 3,882,955

Accounts receivable, net of allowance for doubtful accounts of $66,733 and $70,165 and sales returns of $21,758 and $8,200 for March 31, 2009 and September 31, 2008, respectively

5,266,640 3,390,703 Inventories 2,472,545 2,909,730 Deferred tax asset 233,500 233,500 Prepaid expenses and other current assets � 378,775 � 259,896 Total current assets 9,790,617 10,676,784 Property, Plant and Equipment, net 2,701,044 2,694,290 Other Assets Intangibles, net 7,499,645 7,767,258 Goodwill 11,054,396 11,054,396 Deferred financing costs, net 69,752 81,136 Other assets � 3,091 � 8,360 Total other assets � 21,327,928 � 18,911,150 Total Assets $ 31,118,545 $ 32,282,224 LIABILITIES AND STOCKHOLDERS' EQUITY � Current Liabilities Short Term Note Payable $ 32,451 $ 490,117 Current portion of long term debt 1,695,296 1,649,101 Accounts payable 539,561 1,026,675 Billings in excess of cost 396,957 216,946 Accrued expenses and other current liabilities � 1,299,563 � 1,440,222 Total current liabilities 3,963,828 4,823,061 Long-term Liabilities Long-term debt, net 7,264,698 8,178,420 Note payable to related party � 2,000,000 � 2,000,000 Total long-term liabilities 9,264,698 10,178,420 Stockholders' Equity

Common Stock, $.0005 par value, 40,000,000 shares authorized, 12,177,655 and 12,142,849 shares issued, 11,367,495 and 11,332,689 shares outstanding

6,089 6,072 Preferred Stock, $.001 par value, 15,000,000

Shares authorized, 5,966,000 shares issued and outstanding for March 31, 2009 and September 31, 2008, 10% cumulative, convertible

5,966 5,966 Additional paid in capital 16,263,106 16,122,185 Retained earnings � 2,601,200 � 2,132,862 18,876,361 18,267,085 Less 810,160 shares in treasury - at cost � (986,342) � (986,342) Total stockholders' equity � 17,890,019 � 17,280,743 Total Liabilities and Stockholders' Equity $ 31,118,545 $ 32,282,224 � �

DYNASIL CORPORATION OF AMERICA AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) � Three Months Ended � Six Months Ended March 31 March 31 2009 � 2008 2009 � 2008 Net sales $8,602,885 $3,045,974 $17,370,161 $5,860,880 Cost of sales 4,901,999 2,070,418 10,579,537 3,971,438 Gross profit 3,700,886 975,556 6,790,624 1,889,442

Selling, general and administrative expenses

2,945,625 777,348 5,377,993 1,456,756 Income from operations 755,261 198,208 1,412,631 432,686 Interest expense, net 219,861 42,062 406,658 75,584 Income before income taxes 535,400 156,146 1,005,973 357,102 Income taxes 131,266 10,170 246,198 20,840 Net income $404,134 $145,976 $759,775 $336,262 � Basic net income per common share $0.02 $0.02 $0.04 $0.05 Diluted net income per common share $0.02 $0.02 $0.04 $0.04 �

Weighted average shares outstanding

11,367,008 6,736,852 11,358,143 6,467,518 �