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 June 1, 2011

FOR IMMEDIATE RELEASE

MAGAL S3 SECURITY SYSTEMS REPORTS FIRST QUARTER 2011 FINANCIAL RESULTS


YAHUD, ISRAEL, May 31, 2011 ‐Magal S3 Ltd. (NASDAQ GMS: MAGS, TASE: MAGS),today announced its financial results for the three month period ended March 31, 2011.

Management will hold an investors′ conference call later today, at 10:30am Eastern Time and 5:30pm Israel time, to discuss the results.


FIRST QUARTER 2011 RESULTS SUMMARY

Revenues for the first quarter of 2011 totaled $11.5 million, an increase of 18% compared to the $9.8 million reported in the first quarter of 2010.

Gross profit for the first quarter of 2011 was $4.6 million, or 39.9% of revenues. This is an increase of 26% compared to a gross profit of $3.7 million, or 37.4% of revenues asreported for the first quarter of 2010.

Operating loss for the first quarter of 2011 was reduced to $1.2 million compared with an operating loss of $1.6 million as reported in the first quarter of 2010.

Financing expenses in the quarter amounted to $155,000 compared to $769,000 in the first quarter of 2010. Financing expenses in the quarter were influenced by the changes in the exchange rates of the Israel shekel, Mexican peso and Canadian dollar against the
US dollar.

Taxes on income in the quarter were $200,000 compared with no tax expense in the first quarter of 2010. The relatively high tax expense in the quarter compared with the prior quarter was due the fact that some of the Company?s subsidiaries were profitable
in the quarter.

Net loss for the first quarter of 2011was $1.6 million, compared with a net loss of US$2.4 million in the first quarter of 2010.

Net loss per share in the first quarter of 2011 was $0.15, compared with a net loss per share of $0.23 in the same period last year.


MANAGEMENT COMMENT

Commenting on the results, Mr. Eitan Livneh, President and CEO of Magal S3, said, "The first quarter of the year is seasonally the weakest for our company, but we are pleased in the improvement over last year′s results and it is a good base on which to start 2011. In the past few months we have won a number of key tenders for contracts in some important emerging regions. As we begin to execute on these projects, we expect to see their contribution to our revenues and operating results in the upcoming quarters. Having proven our capabilities, we will continue to compete in future tenders and we look forward to winning additional business in the coming quarters."

For the full report please click here

INVESTORS′ CONFERENCE CALL INFORMATION:

The Company will host a conference call later today, May 31, 2011, at 10:30am Eastern Time.

To participate, please call one of the following teleconferencing numbers. Please begin placing your calls at least 10 minutes before the conference call commences. If you are unable to connect using the toll‐free numbers, please try the international dial‐in
number.

US: 1 866 229 7198
Israel: 03 918 0687
UK: 0 800 404 8418
Intl.: +972 3 918 0687

A replay of the call will be available from the day after the call for three months. The link to the replay will be accessible from Magal′s website at: http://www.magal‐s3.com/.

About Magal S3:
Magal S3 is a leading international provider of security, safety and site management solutions and products (NASDAQ: MAGS).
Over the past 40 years, Magal S3 has delivered tailor‐made solutions to hundreds of satisfied customers in over 80 countries.
Magal S3 offers a broad portfolio of unique products used to protect sensitive installations in some of the world?s most demanding locations and harshest climates. This portfolio covers the following three categories:

 

 

· Perimeter Intrusion Detection Systems (PIDS)
 

A variety of smart barriers and fences, fence mounted detectors, virtual gates, buried and concealed detection systems.

· Closed Circuit TV (CCTV)
  A comprehensive management platform with a leading Intelligent Video Analytics (IVA) and Video Motion Detection (VMD) engine.
· Physical Security Information Management (PSIM)
  A site management open system that enhances command, control and decision making during both routine operations and crisis situations.

This press release contains forward-looking statements, which are subject to risks and uncertainties. Such statements are based on assumptions and expectations which may not be realized and are inherently subject to risks and uncertainties, many of which cannot be predicted with accuracy and some of which might not even be anticipated. Future events and actual results, financial and otherwise, may differ from the results discussed in the forward-looking statements. A number of these risks and other factors that might cause differences, some of which could be material, along with additional discussion of forward-looking statements, are set forth in the Company′s Annual Report on Form 20-F filed with the Securities and Exchange Commission.

 

Magal S3                      CCG Investor Relations
Eitan Livneh, CEO   Ehud Helft / Kenny Green
Tel: +972-3-539-1421   Tel (US): +1 646 201 9246
Assistant: Ms. Elisheva Almog   Int′l Dial: +972 3 607 4717
E-mail: ElishevaA@magal-s3.com  

Email: magal@ccgisrael.com

Web: www.magal-s3.com