FOR IMMEDIATE RELEASE

Magal Security Systems Reports Fourth Quarter 2009 and Year-End 2009 Financial Results

YEHUD, Israel - April 12, 2010 - Magal Security Systems Ltd. (NASDAQ GMS: MAGS, TASE: MAGS), today announced its consolidated financial results for the three and twelve month periods ended December 31, 2009.  Management will hold an investors' conference call later today, at 9 am ET time, 4 pm Israel time, to discuss the results.

In September 2009, Magal's Board of Directors resolved to discontinue the operation of the European integration subsidiary that was, acquired in September 2007.  The subsidiary was sold in December 2009.  The results for the three and twelve month periods ended December 31, 2009 and 2008, as well as the capital gain resulting from the sale, were reclassified to discule the results of that subsidiary as discontinued operations.

Fourth Quarter 2009 Results
Revenues for the fourth quarter of 2009 totaled US $15.0 million, a decrease of 10.1% compared to the fourth quarter of 2008.  The revenue decrease is mostly attributable to revenue shortfall in the North and Latin American markets compared with the comparable period in 2008.

Gross profit for the fourth quarter of 2009 was US $5.7 million, or 38.3% of revenues, compared to 35.4% of revenues as reported for the fourth quarter of 2008.  Gross margin in the quarter increased despite the lower revenue, due to a more favorable mix of products and projects and a more favorable currency exchange rate environment for Magal in 2009 compared with 2008.  Gross margin also benefited from the rationalization of costs and consolidation of the North American business into one unit.

Operating loss for the fourth quarter of 2009 was US $0.9 million, compared with an operating loss of US $8.3 million for the fourth quarter of 2008.

Financing expenses in the three months ended December 31, 2009 amounted to US $0.5 million compared to financing income of US $0.2 million in the fourth quarter of 2008.

Income from discontinued operations was US $4.3 million in the fourth quarter of 2009 compared with a loss of US $12.0 million in the same period last year.

Net income attributable to Magal's shareholders for the fourth quarter of 2009, was US $2.0 million, compared with a net loss of US $24 million for the fourth quarter of 2008.  Net earnings per share in the fourth quarter of 2009 was US $0.19, compared with a net loss per share of US ($2.31) in the same period last year.

Full Year 2009 Results
Revenues for the year ended December 31, 2009 was US$ 54.5 million, a 4.5% decrease compared with the previous year. The decrease is primarily attributable to the lower revenues generated by the Company?s Canadian subsidiary and a reduction in revenues in the European market.

Gross profit for the year increased by 8.4% to US $21.2 million, representing 38.9% of revenues, compared with US $19.5 million, representing 34.2% of revenues in 2008. This increase is mainly attributable to the previously‐mentioned more favorable currency exchange rate environment for Magal in 2009 compared with 2008 as well as a more favorable mix of products and projects. Gross margin also benefited from the rationalization of costs and consolidation of the North American business into one unit.

Operating loss for 2009 was US $2.7 million, compared with an operating loss of US $14.6 million in 2008. The operating loss in 2009 was primarily attributable to the lower volume of revenues resulting from the global economic crisis in 2009.

Net loss attributable to Magal's shareholders for 2009 was US $0.9 million compared with a net loss of US $32.6 million in 2008. Net loss per share for the year ended December 31, 2009 was US $0.08, compared with a net loss per share of US $3.14 in 2008.

Management Comment
Commenting on the results, Mr. Eitan Livneh, President and CEO of Magal, said, "2009 was a turnaround year for Magal. I believe that the changes initiated by the new management team provide a solid foundation for improvements in 2010 and beyond. Over the past year, we have focused on improving every area of the business. This has included making some key management changes, rationalizing all costs, as well as consolidating our North American business into one unit, realizing significant cost savings. The improvement in our margins over the past year, is a clear testament to our success in this regard."

"Looking ahead, in 2010 we intend to continue to develop and sell new advanced security sensors, continue to build on our success with Fortis in the Municipal Control and Command field, and improve our capabilities in the Intelligent Video Analytics space. While the past year has seen many changes for Magal, I believe that they were for the better and together with the whole management team at Magal, we remain enthusiastic about Magal's furture," concluded Mr. Livneh.

Investors' Conference Call Information:
The Company will host a conference call on April 12, 2010 at 9am ET. On the call, management will review and discuss the results and will be available to answer investor questions.

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 Dial-in Number: 1 888 668 9141
Israel Dial-in Number: 03 918 0609
UK Dial-in Number: 0 800 917 5108
International Dial-in Number: +972 3 918 0609

At 9:00 am Eastern Time; 6:00 am Pacific Time; 2:00 pm UK Time; 4:00 pm Israel Time

A replay of the call will be available from the day after the call. The link to the replay will be accessible from the Magal S3 website at: 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
  • Close Circuit TV (CCTV) - a comprehensive management platform with a leading Intelligent Video Analysis (IVA) and Video Motion Detection (VMD) engine
  • Physical Security Information Management (PSIM) ‐ a proprietary site management system that enhances command, control and decision making during both routine operations and crisis situations

This press release contains forwardlooking 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 forwardlooking statements. A number of these risks and other factors that might cause differences, some of which could be material, along with additional discussion of forwardlooking statements, are set forth in the Company's Annual Report on Form 20F filed with the Securities and Exchange Commission.

Magal Security Systems reports Fourth Quarter 2009 and Year-end 2009 Results - More...

Magal S3                      GK Investor Relations
Ilan Ovadia, CFO Ehud Helft / Kenny Green
Tel: +972-3-539-1444 Tel (US): +1-646 201 9246
Fax: +972-3-536-6245

Int'l Dial: +972-3-607-4717

E-mail: ilano@magal-s3.com E-mail: magal@ccgisrael.com