SM&A Reports Financial Results for Q2 2008
 Contact:
    
    SM&A:
    
    Investor Contact:Jim Eckstaedt
    
    Lytham Partners, LLCChief Financial Officer
    
    Joe Diaz, Robert Blum(949) 975-1550
    
    (602) 889-9700
   
    
    Record quarterly revenues of $26.0 million;
    
    Program Services revenues increase 42% vs. comparable 2007 quarter;
    
    Program Services revenues exceed Competition Management revenues for the 1st time;
    
    Highest Aerospace and Defense Revenues in history of SM&A;
    
    12 new customers during the quarter;
    Program Services:




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th
  Competition Management:
  Strategic Advisors:
  Revenue by Market Vertical:




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SG&A Expense and Gross Margins:
   Stock Buyback:
 2008 Guidance:
  Disclosure of Certain Financial Information  .
 Conference Call and Webcast:




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www.smawins.com www.smawins.com
 About SM&A:




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Exhibit A
SM&A
Diluted EPS Non GAAP Reconciliation
 Three Months EndedJune 30, 2008
    
    
    June 30, 2007
    
    
    March 31, 2008$
    
    
    Per Share
    
    
    $
    
    
    Per Share
    
    
    $
    
    Per ShareEPS (as reported)
    
    
    
    
    
    $
    0.05
    
    
    
    
    
    
    $
    0.11
    
    
    
    
    
    
    $
    0.03Earn-Out Expense
    
    $
    733
    
    
    
    0.02
    
    
    $
    
    
    
    
    
    
    
    $
    876
    
    
    
    0.03Proxy Contest Cost
    
    
    820
    
    
    
    0.03
    
    
    
    
    
    
    
    
    
    
    
    60
    
    
    
    0.00Company Wide Offsite
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,100
    
    
    
    0.03Subtotal
    
    $
    1,553
    
    
    
    0.05
    
    
    $
    
    
    
    
    
    
    
    $
    2,036
    
    
    
    0.06Non-GAAP EPS (as adjusted)
    
    
    
    
    
    $
    0.10
    
    
    
    
    
    
    $
    0.11
    
    
    
    
    
    
    $
    0.09Tax Rate
    
    
    
    
    
    
    42.2
    %
    
    
    
    
    
    
    40.2
    %
    
    
    
    
    
    
    42.9
    %Diluted Shares
    
    
    
    
    
    
    18,698
    
    
    
    
    
    
    
    18,964
    
    
    
    
    
    
    
    19,100




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Exhibit B
SM&A
SG&A Non-GAAP Reconciliation
 Three Months EndedJune 30, 2008
    
    June 30, 2007
    
    March 31, 2008Revenue
    
    $
    26,009
    
    
    
    100.0
    %
    
    $
    25,568
    
    
    
    100.0
    %
    
    $
    25,423
    
    
    
    100.0
    %SG&A (as reported)
    
    
    8,553
    
    
    
    32.9
    %
    
    
    6,631
    
    
    
    25.9
    %
    
    
    8,957
    
    
    
    35.2
    %Less:Earn-Out Expense
    
    
    733
    
    
    
    2.8
    %
    
    
    
    
    
    
    0.0
    %
    
    
    876
    
    
    
    3.4
    %SG&A less Earn-Out Expense
    
    
    7,820
    
    
    
    30.1
    %
    
    
    6,631
    
    
    
    25.9
    %
    
    
    8,081
    
    
    
    31.8
    %Less:Stock Based Compensation
    
    
    434
    
    
    
    1.7
    %
    
    
    448
    
    
    
    1.8
    %
    
    
    421
    
    
    
    1.7
    %Proxy Contest Cost
    
    
    820
    
    
    
    3.2
    %
    
    
    
    
    
    
    0.0
    %
    
    
    60
    
    
    
    0.2
    %Company Wide Offsite
    
    
    
    
    
    
    0.0
    %
    
    
    
    
    
    
    0.0
    %
    
    
    1,100
    
    
    
    4.3
    %Subtotal
    
    
    1,254
    
    
    
    4.8
    %
    
    
    448
    
    
    
    1.8
    %
    
    
    1,581
    
    
    
    6.2
    %Non-GAAP SG&A (as adjusted)
    
    $
    6,566
    
    
    
    25.2
    %
    
    $
    6,183
    
    
    
    24.2
    %
    
    $
    6,500
    
    
    
    25.6
    %




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SM&A
CONDENSED CONSOLIDATED BALANCE SHEETS
 June 30,
    
    
    December 31,2008
    
    
    2007Assets:
    
    (unaudited)Current assets:Cash and cash equivalents
    
    $
    3,315
    
    
    $
    5,422Investments
    
    
    5,653
    
    
    
    10,610Accounts receivable, net
    
    
    24,056
    
    
    
    18,171Prepaid expenses and other current assets
    
    
    1,526
    
    
    
    2,011Total current assets
    
    
    34,550
    
    
    
    36,214Fixed assets, net
    
    
    3,318
    
    
    
    3,399Goodwill
    
    
    8,374
    
    
    
    8,278Intangibles, net
    
    
    1,670
    
    
    
    1,892Other assets
    
    
    1,890
    
    
    
    895$
    49,802
    
    
    $
    50,678Liabilities and Stockholders Equity:Current liabilities:Accounts payable
    
    $
    2,331
    
    
    $
    1,925Accrued compensation and related benefits
    
    
    4,470
    
    
    
    3,508Accrued contingent consideration
    
    
    
    
    
    
    1,750Other current liabilities
    
    
    148
    
    
    
    127Total current liabilities
    
    
    6,949
    
    
    
    7,310Other liabilities
    
    
    711
    
    
    
    785Total liabilities
    
    
    7,660
    
    
    
    8,095Commitments and contingenciesStockholders equity:Preferred stock
    
    
    
    
    
    
    Common stock
    
    
    2
    
    
    
    2Additional paid-in capital
    
    
    46,586
    
    
    
    45,450Treasury stock
    
    
    (4,595
    )
    
    
    (1,506
    )Retained earnings (accumulated deficit)
    
    
    149
    
    
    
    (1,363
    )Total stockholders equity
    
    
    42,142
    
    
    
    42,583$
    49,802
    
    
    $
    50,678




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SM&A
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
 Three Months Ended
    
    
    Six Months EndedJune 30,
    
    
    June 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Revenue
    
    $
    26,009
    
    
    $
    25,568
    
    
    $
    51,432
    
    
    $
    49,192Cost of revenue
    
    
    15,728
    
    
    
    15,663
    
    
    
    31,413
    
    
    
    30,080Gross margin
    
    
    10,281
    
    
    
    9,905
    
    
    
    20,019
    
    
    
    19,112Selling, general and administrative expenses
    
    
    8,553
    
    
    
    6,631
    
    
    
    17,510
    
    
    
    13,525Operating income
    
    
    1,728
    
    
    
    3,274
    
    
    
    2,509
    
    
    
    5,587Interest income, net
    
    
    22
    
    
    
    78
    
    
    
    117
    
    
    
    221Income before income taxes
    
    
    1,750
    
    
    
    3,352
    
    
    
    2,626
    
    
    
    5,808Income tax expense
    
    
    738
    
    
    
    1,349
    
    
    
    1,114
    
    
    
    2,354Net income
    
    $
    1,012
    
    
    $
    2,003
    
    
    $
    1,512
    
    
    $
    3,454Earnings per share:Basic
    
    $
    0.05
    
    
    $
    0.11
    
    
    $
    0.08
    
    
    $
    0.18Diluted
    
    $
    0.05
    
    
    $
    0.11
    
    
    $
    0.08
    
    
    $
    0.18Shares used in calculating earnings per share:Basic
    
    
    18,603
    
    
    
    18,787
    
    
    
    18,797
    
    
    
    18,698Diluted
    
    
    18,698
    
    
    
    18,964
    
    
    
    18,901
    
    
    
    18,882