**For      Immediate Release**

**Emergent      Group Inc. Reports Record Second Quarter Sales and EPS of      $0.07**

**Profit      Decline Due to Transition to New and More Profitable      Technology**

----

**Emergent          Group Inc. and Subsidiaries**

**Condensed          Consolidated Balance Sheet**

|                                                                                                                                             |   | **June                      30,****2007** |       |
|--------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|------------|
| **ASSETS**                                                                                                                                       |   | (Unaudited)                               |       |
|                                                                                                               |   |                                      |       |
| **Current                    assets**                                                                                                  |   |                                      |       |
|  Cash                                                                                                                   |   | $                                         | 1,076,253  |   |
|  Accounts                    receivable, net of allowance for doubtful                                                                      |   |                                      |       |   |
|   accounts                    of $19,478                                                                                               |   |                                      | 2,312,442  |   |
|  Inventory                                                                                                                                  |   |                                      | 460,499    |   |
|  Prepaid                    expenses                                                                                                        |   |                                      | 212,013    |   |
|  Deferred                    tax assets                                                                                                     |   |                                      | 905,400    |   |
|                                                                                                               |   |                                      |       |   |
|    Total                    current assets                                                                                        |   |                                      | 4,966,607  |   |
|                                                                                                               |   |                                      |       |   |
| **Property                  and equipment, net of accumulated depreciation                  and****amortization                  of $5,216,079** |   |                                      | 4,139,020  |   |
| **Goodwill**                                                                                                                 |   |                                      | 1,120,058  |   |
| **Other                  intangible assets, net of accumulated amortization                  of****$143,960**                          |   |                                      | 122,326    |   |
| **Deposits                    and other assets**                                                                                                 |   |                                      | 112,662    |   |
|                                                                                                               |   |                                      |       |   |
|                                                                                                               |   |                                      |       |   |
| **Total                    assets**                                                                                               |   | $                                         | 10,460,673 |   |
|                                                                                                               |   |                                      |       |   |
| **LIABILITIES                    AND SHAREHOLDERS' EQUITY**                                                                                      |   |                                      |       |   |
|                                                                                                               |   |                                      |       |   |
| **Current                    liabilities**                                                                                                  |   |                                      |       |   |
|  Current                    portion of capital lease obligations                                                                            |   | $                                         | 991,180    |   |
|  Current                    portion of notes payable                                                                                        |   |                                      | 106,227    |   |
|  Accounts                    payable                                                                                                        |   |                                      | 531,904    |   |
|  Accrued                    expenses and other liabilities                                                                                  |   |                                      | 1,104,913  |   |
|                                                                                                               |   |                                      |       |   |
|    Total                    current liabilities                                                                                   |   |                                      | 2,734,224  |   |
|                                                                                                               |   |                                      |       |   |
| **Capital                    lease obligations**, net of current portion                                                                         |   |                                      | 2,209,323  |   |
| **Notes                    payable**, net of current portion                                                                                     |   |                                      | 50,445     |   |
|                                                                                                               |   |                                      |       |   |
|    Total                  liabilities                                                                                             |   |                                      | 4,993,992  |   |
|                                                                                                               |   |                                      |       |   |
| **Minority                    interest**                                                                                                    |   |                                      | 452,038    |   |
|                                                                                                               |   |                                      |       |   |
| **Shareholders'                    equity**                                                                                                      |   |                                      |       |   |
|  Preferred                    stock, $0.001 par value, non-voting 10,000,000                                                                |   |                                      |       |   |
|   shares                    authorized, no shares issued and outstanding                                                               |   |                                      | -          |   |
|  Common                    stock, $0.04 par value, 100,000,000 shares authorized                                                            |   |                                      |       |   |
|   5,555,881                    shares issued and outstanding                                                                           |   |                                      | 222,232    |   |
|  Additional                    paid-in capital                                                                                              |   |                                      | 14,787,551 |   |
|  Accumulated                    deficit                                                                                                     |   |                                      | (9,995,140 | ) |
|                                                                                                               |   |                                      |       |   |
|    Total                    shareholders' equity                                                                                  |   |                                      | 5,014,643  |   |
|                                                                                                               |   |                                      |       |   |
| ** Total                    liabilities and shareholders' equity**                                                                          |   | $                                         | 10,460,673 |   |
|                                                                                                               |   |                                      |       |   |

----

**Emergent          Group Inc. and Subsidiaries**

**Condensed          Consolidated Statements of Income**

**(Unaudited)**

|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |
|----------------------------------------------------------------------|--------|-------------------------------------------|---------------|--------|-----------------------------------------|------------|---------------|----------|--------|------------|---------------|--------|
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |
|                                                                 |   | **Three                    Months Ended** |          |   | **Six                    Months Ended** |       |
|                                                                 |   | **June                    30,**           |          |   | **June                    30,**         |       |
|                                                                 |   | **2007**                                  |          |   | **2006**                                |       |          | **2007** |   |       | **2006**      |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |
| **Revenue**                                                          |   | $                                         | 4,331,488     |   |                                    | $          | 3,993,211     |     |   | $          | 8,714,296     |   |   | $ | 7,984,028 |   |
| **Cost                    of goods sold**                            |   |                                      | 2,623,649     |   |                                    |       | 2,362,269     |     |   |       | 5,190,753     |   |   |   | 4,801,949 |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Gross                    profit**                                  |   |                                      | 1,707,839     |   |                                    |       | 1,630,942     |     |   |       | 3,523,543     |   |   |   | 3,182,079 |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Selling,                    general, and administrative expenses** |   |                                      | 1,099,876     |   |                                    |       | 986,092       |     |   |       | 2,188,100     |   |   |   | 1,962,420 |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Income                    from operations**                        |   |                                      | 607,963       |   |                                    |       | 644,850       |     |   |       | 1,335,443     |   |   |   | 1,219,659 |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Other                    income (expense)**                        |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| Interest                    expense                                  |   |                                      | (59,798       | )      |                                    |       | (42,503       | )        |   |       | (111,602      | )      |   |   | (89,244 | ) |
| Gain                    on disposal of property and equipment        |   |                                      | 112           |   |                                    |       | 1,390         |     |   |       | 8,214         |   |   |   | 2,690 |   |
| Other                    income, net                                 |   |                                      | 21,872        |   |                                    |       | 45,663        |     |   |       | 36,092        |   |   |   | 76,240 |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| Total                    other income (expense)                      |   |                                      | (37,814       | )      |                                    |       | 4,550         |     |   |       | (67,296       | )      |   |   | (10,314 | ) |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Income                    before provision for income taxes**      |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **and                    minority interest**                         |   |                                      | 570,149       |   |                                    |       | 649,400       |     |   |       | 1,268,147     |   |   |   | 1,209,345 |   |
| **Provision                    for income taxes**                    |   |                                      | (39,510       | )      |                                    |       | (9,972        | )        |   |       | (95,412       | )      |   |   | (33,836 | ) |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Income                    before minority interest**               |   |                                      | 530,639       |   |                                    |       | 639,428       |     |   |       | 1,172,735     |   |   |   | 1,175,509 |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Minority                    interest in income of consolidated**   |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **limited                    liability companies**                   |   |                                      | (169,435      | )      |                                    |       | (89,621       | )        |   |       | (294,420      | )      |   |   | (161,707 | ) |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Net                    income**                                    |   | **$**                                     | **361,204**   |   |                                    | **$**      | **549,807**   |     |   | **$**      | **878,315**   |   |   | **$** | **1,013,802** |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Basic                    earnings per share**                      |   | **$**                                     | **0.07**      |   |                                    | **$**      | **0.10**      |     |   | **$**      | **0.16**      |   |   | **$** | **0.19** |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Diluted                    earnings per share**                    |   | **$**                                     | **0.06**      |   |                                    | **$**      | **0.09**      |     |   | **$**      | **0.15**      |   |   | **$** | **0.17** |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Basic                    weighted average shares outstanding**     |   | ** **                                | **5,551,558** |   |                                    | ** ** | **5,459,200** |     |   | ** ** | **5,480,253** |   |   | ** ** | **5,456,127** |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |
| **Diluted                    weighted-average shares outstanding**   |   | ** **                                | **5,874,849** |   |                                    | ** ** | **5,805,504** |     |   | ** ** | **5,802,259** |   |   | ** ** | **5,802,431** |   |
|                                                                 |   |                                      |          |   |                                    |       |          |     |   |       |          |   |   |   |   |   |