BUFFALO, N.Y., June 11 /PRNewswire-FirstCall/ -- HIGHLIGHTS -- Revenues for Ecology and Environment, Inc. (E&E, Amex: EEI) for the third quarter of fiscal year 2008 were $27.4 million, compared to $26.3 for the third quarter of fiscal year 2007. The Company reported net income for the third quarter of fiscal year 2008 of $123,000 or $.03 per share, compared to net income of $480,000 or $.11 per share in the third quarter of the prior year. The majority of the decrease in net income is attributable to a Financial Accounting Standards Board Interpretation No. 48 (FIN 48) accrual of $.08 per share. DETAILS -- Revenues for the third quarter of fiscal year 2008 were $27.4 million, an increase of $1.1 million from the $26.3 million reported for the prior year. Revenues from the Company's majority owned subsidiary E&E do Brasil were $1.7 million for the third quarter of fiscal year 2008, an increase of $500,000 from the $1.2 million reported in the third quarter of fiscal year 2007. The increase in E&E do Brasil revenues was mainly attributable to increased work in the public and private power industries. Revenues of the parent company E&E, Inc. increased $700,000 during the third quarter of fiscal year 2008. The increase in revenue was attributable to increased work on contracts in the Company's energy and state sectors. Offsetting these increases were decreases in work at the parent company in the federal government sectors. Net income for the third quarter of fiscal year 2008 decreased $357,000 compared with the third quarter of fiscal year 2007. Gross profits increased $206,000 during the third quarter of fiscal year 2008 as a result of the increased revenue reported at E&E do Brasil and the parent company E&E, Inc. The increased gross profits were offset by increased costs associated with the Company's FIN 48 Kuwait tax accrual as well as higher indirect costs at the Company's subsidiary E&E do Brasil. For the three months ended April 26, 2008, E&E recorded an additional FIN 48 accrual of $420,000 or $.08 per share after tax. The FIN 48 accrual included additional interest and penalties of approximately $201,000 ($.04 per share after tax) as well as a foreign exchange loss of $219,000 ($.04 per share after tax) to adjust the FIN48 Kuwait tax reserve to current exchange rates. This expense is related to the contested Kuwait taxes. The Company has continued its assertion of a contractual obligation for reimbursement from the Public Authority for Assessment of Compensation for Damages Resulting from Iraqi Aggression (PAAC) should any tax liability be agreed to with the Kuwait Ministry of Finance, however the assessment of this reimbursement in not permitted under FIN 48. The parent company has experienced significant increases in labor utilization since the end of the third quarter and expects this upsurge in direct hours to continue throughout the balance of the fourth quarter. Additionally in May 2008, Ecology and Environment, Inc. was awarded a multi-year regional contract to provide the U.S. Environmental Protection Agency (EPA) with technical support for the assessment and cleanup of the release into the environment of oil, petroleum and hazardous substances that pose a threat to the public in EPA's Region 9. The contract has a two year base period and two one and one-half year option periods. With all option years and access to an increased capacity pool to support the Agency in the event of an incident of national significance, the contract could total $64 million over 5 years. This document contains forward-looking statements regarding future events and our future results that are subject to the safe harbors created under the Securities Act of 1933 (the "Securities Act") and the Securities Exchange Act of 1934 (the "Exchange Act"). All statements other than statements of historical facts are statements that could be deemed forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projections about the industries in which we operate and the beliefs and assumptions of our management. Words such as "expects," "anticipates," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," "continues," "may," variations of such words and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to projections of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or circumstances are forward-looking statements. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties, and assumptions that are difficult to predict. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update any forward-looking statements for any reason. Further, information on risks and uncertainties is available in our filings with the Securities and Exchange Commission, which are incorporated by reference. Ecology and Environment, Inc. is headquartered in Lancaster, New York, a suburb of Buffalo. Its common stock is listed on the American Stock Exchange under the symbol EEI. E&E can be located on the World Wide Web at http://www.ene.com/. Financial Report - (In thousands, except per share information) Three Months Ending April 26, 2008 April 28, 2007 Revenue $27,413 $26,262 Net Income From Continuing Operations 123 479 Net Gain From Discontinued Operations - 1 Net Income 123 480 Net Income Per Common Share: Basic Continuing Operations $0.03 $0.11 Discontinued Operations - - Net Income Per Common Share: Basic $0.03 $0.11 Net Income Per Common Share: Diluted Continuing Operations $0.03 $0.11 Discontinued Operations - - Net Income Per Common Share: Diluted $0.03 $0.11 Nine Months Ending April 26, 2008 April 28, 2007 Revenue $77,138 $74,053 Net Income From Continuing Operations 754 1,832 Net Income From Discontinued Operations - 574 Net Income 754 2,406 Net Income Per Common Share: $0.18 $0.43 Discontinued Operations - 0.14 Net Income Per Common Share: Basic $0.18 $0.57 Net Income Per Common Share: Diluted Continuing Operations $0.18 $0.43 Discontinued Operations - 0.13 Net Income Per Common Share: Diluted $0.18 $0.56 DATASOURCE: Ecology and Environment, Inc. CONTACT: John Mye of Ecology and Environment, Inc., +1-716-684-8060 Web site: http://www.ene.com/

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