AXSYS TECHNOLOGIES ANNOUNCES 79% INCREASE IN THIRD QUARTER OPERATING INCOME AND INCREASES 2004 GUIDANCE

ROCKY HILL, CONN. - November 1, 2004 - Axsys Technologies, Inc. (NASDAQ: AXYS), a global leader in the desi gn, manufacture and distribution of precision opto-mechanical subsystems and components, today announced financial results for the third quarter and nine-month period ended October 2, 2004.

Third Quarter Highlights - versus fiscal 2003 third quarter

• Sales rose 24.3% to $26.4 million.
• Gross margin increased to 30.2% from 26.9%.
• Operating income was up 79.3% to $2.2 million; operating margin rose to 8.4% from 5.8%.
• Net income grew to $1.9 million, or $0.27 per diluted share, from $1.2 million or $0.17 per diluted sha re, a 58.8% increase in diluted EPS.
• Effective tax rate for the current quarter was 10.0%, compared to a 4.5% rate in the third quarter of 2 003.
• Third quarter bookings rose 87.8% to a record $37.7 million, bringing backlog to a record $93.1 millio n.
• Significant bookings for the quarter include the $9.8 million James Webb Space Telescope project.

Axsys exceeded its sales and bookings expectations for the quarter as a result of heightened defense spending, gen eral economic growth and the sale of increasingly complex electro-optical solutions. In addition, growth in the q uarter included the results of the newly integrated acquisition, Axsys Technologies IR Systems, formerly Telic Opt ics, Inc. Excluding the acquisition, revenues increased 18.0% and bookings increased 81.6% in the third quarter.

Segment Sales (in millions):

	Three Months Ended:			Nine Months Ended:
	October 2,2004	September 27,2003		October 2,2004	September 27,2003
Aerospace and Defense	$16.6	$12.5		$45.5	$37.1
Commercial Products	3.3	3.3		10.9	10.3
Distributed Products	6.5	5.4		19.1	15.9

"Our third quarter results continue to build upon our successful track record," said Stephen W. Bershad, Chairman and Chief Executive Officer of Axsys. "Not only have we delivered solid revenue and income growth, but our backlo g is the strongest in the Company's history. Our continuing efforts to deliver high quality, competitive products to our broad base of customers in a timely manner are resulting in larger and more sophisticated orders. Importa ntly, higher margins are stemming from favorable product mix, volume-driven leverage, and improved production effi ciencies."

Financial Guidance
The financial results for the first nine months of 2004, combined with the Company's strong backlog, have led Axsy s to increase its financial guidance for fiscal 2004. Axsys now anticipates 2004 revenues of approximately $102 m illion and 2004 operating income of approximately $9 million, representing year-over-year growth of 20% and 79%, r espectively. This compares to previous guidance of 15% - 16% revenue growth and 55% - 60% operating income growth .

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchang e Act of 1934, as amended. One can identify these forward-looking statements by the use of the words such as "expe ct," "anticipate," "plan," "may," "will," "estimate" or other similar expressions. Because such statements apply to future events, they are subject to risks and uncertainties that could cause the actual results to differ materi ally. Important factors, which could cause actual results to differ materially, are described in Axsys' reports on Form 10-K and 10-Q on file with the Securities and Exchange Commission, including without limitation: the introdu ction of competing products or technologies by other companies and/or pricing pressures from competitors and/or cu stomers, a reversal or slowdown of the modest economic recovery presently being experienced in the United States, Axsys' inability to achieve synergies in connection with the acquisition of Telic Optics, Inc., the incurrence of unexpected costs in connection with the acquisition and other contingencies and risks relating to the integration of Telic's operations and business. These statements reflect the Company's current beliefs and are based upon inf ormation currently available to Axsys. Be advised that developments subsequent to this release are likely to cau se these statements to become outdated with the passage of time, and we specifically disclaim any obligation to up date these statements. For more information concerning the foregoing risks and uncertainties, see the Securities and Exchange Commission filings for Axsys.