PAGI Pemco Aviation Grp. (MM)

Pemco Aviation Group, Inc. (NASDAQ: PAGI) announced today that its Dothan, Alabama subsidiary, Pemco World Air Services, Inc., has entered into a contract with Europe Airpost, for the conversion of two (2) B737-300 aircraft from passenger to quick-change (QC), configuration. In addition, Pemco will be performing heavy maintenance and paint on both aircraft. Inductions will occur beginning in August of this year. Europe Airpost, based at Charles de Gaulle International Airport in Paris, France, is a European combination carrier providing both passenger and express freight services with a fleet of 22 aircraft. Kevin Casey, Vice President, Commercial Business Development said, �We are very pleased to announce the return of Europe Airpost to our customer list. Our companies� history of technical cooperation dates back to the early �90�s when then-L�Aeropostal took delivery of their first of many 737-300QC�s. Today, with their successful and progressive senior leadership and fleet of modern, well-maintained Pemco-converted 737-300QC and -300F aircraft, Europe Airpost is well positioned for continued growth and success. We look forward to partnering with them on this new program and providing them with the highest possible quality, service and value for which Pemco is recognized.� Yves Groshenry, Director of Engineering & Maintenance for Europe Airpost, said, "We look forward to the delivery of two of Pemco's newest generation 737-300 QC aircraft. These two modifications are completely in line with the continuous relationship we have built with Pemco over the last fifteen years." Pemco Aviation Group, Inc., with executive offices in Birmingham, Alabama, and facilities in Alabama and California, performs maintenance and modification of aircraft for the U.S. Government and foreign and domestic commercial customers. The company also provides aircraft parts, support and engineering services and develops and manufactures aircraft cargo systems, rocket vehicles and control systems, and precision components. This press release contains forward-looking statements made in reliance on the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements may be identified by their use of words, such as "believe," "expect," "intend" and other words and terms of similar meaning, in connection with any discussion of the Company's prospects, financial statements, business, financial condition, revenues, results of operations or liquidity. Factors that could affect the Company's forward-looking statements include, among other things: the possibility that the sale of Pemco may not close on the terms described in this release, or at all; changes in global or domestic economic conditions; the loss of one or more of the Company's major customers; the Company's ability to obtain additional contracts and perform under existing contracts; the outcome of pending and future litigation and the costs of defending such litigation; financial difficulties experienced by the Company's customers; potential environmental and other liabilities; the inability of the Company to obtain additional financing; material weaknesses in the Company�s internal control over financial reporting; regulatory changes that adversely affect the Company's business; loss of key personnel; and other risks detailed from time to time in the Company's SEC reports, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2006. The Company cautions readers not to place undue reliance on any forward-looking statements, which speak only as of the date on which they are made. The Company does not undertake any obligation to update or revise any forward-looking statements and is not responsible for changes made to this release by wire services or Internet services.