Company Continues to Increase Customer Base and Volume of Refrigerant Sold  

PEARL RIVER, N.Y. – August 3, 2006 – Hudson Technologies, Inc. (Nasdaq: HDSN), a leading refrigerant services company specializing in proprietary on-site decontamination services for large comfort and process cooling systems, today announced results for the second quarter and six months ended June 30, 2006.  

Revenues for the second quarter of 2006 were $8,803,000, an increase of $1,582,000 or 22% from $7,221,000 reported during the comparable 2005 period.  Net income for the second quarter was $1,297,000, or $0.05 per share, which includes a $63,000 non-cash charge for share-based compensation due to the adoption of SFAS 123r as of January 1, 2006.  This compares to net income of $1,670,000 for the second quarter of 2005, or $0.07 per share. 

Revenues for the six months ended June 30, 2006 were $15,709,000, an increase of $3,906,000 or 33% from the $11,803,000 reported during the comparable 2005 period. For the first six months of 2006, the Company reported net income of $1,544,000, or $0.06 per share, which includes a $150,000 non-cash charge for share-based compensation due to the adoption of SFAS 123r as of January 1, 2006. This compares to net income of $1,893,000 for the first six months of 2005, or $0.07 per share.

Comments by Kevin J. Zugibe, chairman and chief executive officer, Hudson Technologies:

“The second quarter of 2006 was among the best quarters in the Company's history.   Revenues were up 22% over last year, marking the Company's strongest quarterly revenues since 1998.  More importantly, revenues from our RefrigerantSide® Services were up slightly from last year's strong results and, through our continued efforts to grow our business, we are selling a higher variety and volume of refrigerants to a greater number of customers.    

“As discussed last quarter, a certain refrigerant that yielded exceptionally high gross profit margins throughout 2005, continued to yield less than historical margins during the second quarter of 2006, reducing overall gross profit margins and decreasing net income as compared to the previous year’s period. We believe that the reduction in the gross profit margin on this product is temporary and anticipate a return to historical gross profit margins for the 2007 year.   Moreover, to a large extent we have been able to mitigate the impact from the reduction in gross profit margins on this refrigerant through the expansion of our customer base and increased sales of other products.  We believe these two factors, together with our anticipated return to more historical gross profits margins on this refrigerant, should benefit the Company in 2007 and beyond.  We also believe that these factors will help fuel the Company's future growth, not just in refrigerant sales, but also in our sales of RefrigerantSide® Services.” 

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