EXFO Electro-Optical Engineering Inc.

EXFO Electro-Optical Engineering Inc.

September 26, 2007 09:00 ET

EXFO Receives Growth Strategy Leadership Award from Frost & Sullivan for Fourth Consecutive Year

Honored with related market leadership awards for OTDR and OLTS segments

QUEBEC CITY, QUEBEC--(Marketwire - Sept. 26, 2007) - EXFO Electro-Optical Engineering Inc. (TSX:EXF)(NASDAQ:EXFO) announced today that it has been named recipient of the Growth Strategy Leadership Award by Frost & Sullivan for the fourth consecutive year.

The award is presented annually to the company whose growth strategy generates the largest market-share gains in the global fiber-optic test equipment (FOTE) market during the previous calendar year.

According to Frost & Sullivan, a leading global growth consulting company, EXFO increased its overall market share from 11.0% in 2005 to 12.7% in 2006 for third place overall in the global FOTE market.

Frost & Sullivan estimated the FOTE market to be $586.1 million in 2006, including $310.0 million for the portable installation and maintenance (I&M) test market. Based on Frost & Sullivan's market data, EXFO improved its leadership position in the portable I&M test market from 23.0% in 2005 to 25.5% in 2006.

"These latest numbers by Frost & Sullivan confirm that we continue to gain market share in the global fiber-optic test equipment market and are building on our leadership position in our core optical installation and maintenance space, thanks to strong innovation processes and global sales presence," said Germain Lamonde, EXFO's Chairman, President and CEO. "We're very honored to be recognized for the fourth consecutive year for having achieved the largest market-share gains. We intend to keep gaining market share and become the No. 1 player in the global telecom test and measurement industry."

EXFO made significant inroads in the handheld optical time-domain reflectometry (OTDR) market segment with year-over-year growth of 39.0% in 2006, according to Frost & Sullivan. The company also grew sales 26.1% year over year in the handheld optical spectrum analyzer (OSA) market segment and 10.4% in the handheld optical power meter segment. Overall, EXFO holds the No. 1 position in the handheld OTDR (26.2% market share), optical loss test set (57.9%), power meter (23.8%), light source (15.4%) and PMD (33.3%) market segments.

Frost & Sullivan handed EXFO related Market Leadership Awards for the OTDR and OLTS segments of the global fiber-optic test equipment market.

"There is no question EXFO has kept on developing highly differentiated and superior portable optical test solutions in OTDR, dispersion measurement, optical spectrum analysis and optical loss testing by putting our customers at the forefront of our product development strategy," said Etienne Gagnon, EXFO's Vice-President of Product Management and Marketing. "These leadership positions also reflect that we're developing innovative test solutions that evolve with the changing needs of our customers and their advanced networks be it FTTx, ROADM, DWDM or other optical technologies."

Despite this industry recognition, EXFO is showing no signs of becoming complacent. It has released a number of best-of-class optical test solutions, including amongst others the AXS-200 SharpTESTER platform for multi-service and multi-medium characterization of access networks; E-Series OTDRs for testing access, metro and long-haul links, including a high-performance, ultra-long haul OTDR; a next-generation Cable Assembly and Component Test System for production testing of short fiber assemblies and FTTx components; and FiberFinder, an instrument designed for the efficient and safe management of live and dark optical fibers.

"The breadth and depth of EXFO's product portfolio is unmatched in the portable fiber-optic test market," said Lakshman Koudinya, research analyst at Frost & Sullivan. "And the innovative test solutions that the company introduces year-in and year-out suggest it will be a force to be reckoned with for many years to come in this competitive environment."

To learn more about Frost & Sullivan's Best Practices Awards, visit www.awards.frost.com.

About EXFO

EXFO is a recognized test and measurement expert in the global telecommunications industry. The Telecom Division, which represents the majority of the company's business, offers a full suite of test solutions and monitoring systems to network service providers, cable TV operators, telecom system vendors and component manufacturers in approximately 70 countries. EXFO is the global market leader for portable optical test solutions and a leading supplier of protocol and access test solutions to enable triple-play deployments and converged IP networking. Its PC/Windows-based modular FTB-200, FTB-400 and IQS-500 test platforms host a wide range of modular test solutions across optical, physical, data and network layers, while maximizing technology reuse across several market segments. The Life Sciences and Industrial Division, which leverages several core telecom technologies, offers value-added solutions in the life sciences and high-precision assembly sectors based on advanced spot-curing, fluorescence microscopy and nanopositioning solutions.

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