(Wake Forest, N.C.) PowerSecure International, Inc. (Nasdaq: POWR) today reported strong revenue and profit results for its second quarter of 2010. Second quarter revenues were $34.3 million, increasing 36.5% compared to $25.1 million in the second quarter of 2009, and diluted earnings per share (“E.P.S.”) were $0.07, increasing 75% compared to $0.04 in the second quarter of 2009.

These revenue and profit results were driven by the combined substantial year-over-year revenue growth in the Company’s Interactive Distributed Generation business of 55%, Utility Infrastructure business of 40%, and Energy Efficiency business of 21%. Additionally, the Company’s second quarter gross margin as a percentage of revenue was 34.5%, 1.7 percentage points higher than the second quarter of 2009, due a favorable mix of projects completed in the second quarter of 2010 compared to a year ago. Operating expenses for the second quarter of 2010 were higher than the prior year’s second quarter by $3.5 million, primarily due to investments the Company is making in business expansion and new product development in each of its Interactive Distributed Generation, Utility Infrastructure, and Energy Efficiency business areas.

Sidney Hinton, CEO of PowerSecure, said, “We are very pleased with our second quarter results. Our top line was strong, reflecting ‘across the board’ growth in our businesses. Additionally, our year-over-year gross margin gains reflect the strong value our products and services deliver to our customers, as well as the efforts of the PowerSecure team to work smart – in our service delivery process and our engineering and manufacturing approach. We are bullish on the opportunities we see to serve customers in each of our business areas, and in the first half of 2010 we made investments to put us in position to realize these opportunities. These investments include technology, people, equipment, and new product development to drive and enhance both our near and long-term growth.”

Mr. Hinton continued, “The new business we were awarded in the second quarter enabled us to grow our backlog to $127 million. This expanded backlog enables us to continue to plan and invest over longer-term horizons. Our near term backlog decreased due to the mix of new revenue awards being longer-term and more recurring in nature, and because we continue to exceed our own expectations in our project execution and revenue recognition. We will remain attentive to any patterns that develop in our business given the near-term uncertainty in the recovery of the economy. That said, we continue to be very excited about the strategic positions of each of our businesses and their growth opportunities and promise.”

For the second quarter of 2010, the Company’s Energy Services segment realized a 2.6% year-over-year increase in revenues from its Southern Flow business, the first year-over-year increase in four quarters, due to the improved conditions in the natural gas markets. The Company’s WaterSecure business contributed second quarter income of $0.9 million, up 90% on a year-over-year basis. The Company’s WaterSecure results were also positively impacted by improved conditions in the natural gas markets, as well as year-over-year increases in oil prices.

Second quarter 2010 operating expenses were $11.1 million compared to $7.6 million in the second quarter of 2009. The year-over-year increase was primarily due to investments to support new and future business growth, including personnel, vehicles and facilities in each of the Company’s Energy and Smart Grid Solutions businesses. Additionally, the year-over-year increase includes investments in new product development, increases in compensation expense, increases in selling expense due to higher revenue, and increases in depreciation from capital expenditures for IDG systems deployed under the Company’s growing recurring revenue business.

PowerSecure International, Inc. is a leading provider of Energy and Smart Grid Solutions to electric utilities, and their commercial, institutional, and industrial customers, as well as Energy Services to the oil and natural gas industry. PowerSecure’s Energy and Smart Grid Solutions businesses provide products and services in the areas of Energy Efficiency, Interactive Distributed Generation, and Utility Infrastructure. The Company’s Energy Efficiency business provides customers with energy efficient lighting technologies that deliver improved quality of light, including its proprietary EfficientLights LED lighting product that saves grocery, drug, and convenience stores 70% off the cost to operate traditional fluorescent lighting in their refrigerated cases. The Company is a pioneer in developing Interactive Distributed Generation® systems with sophisticated, proactive smart grid capabilities, including the ability to 1) forecast electricity demand and electronically deploy the systems to deliver more efficient, and environmentally friendly power at peak power times, 2) provide utilities with dedicated electric power generation capacity to utilize for demand response purposes, and 3) provide customers with the most dependable standby power in the industry. PowerSecure also provides utilities with transmission and distribution infrastructure construction and maintenance services, and engineering and regulatory consulting services. The Company provides Energy Services to the oil and natural gas industry through its Southern Flow and WaterSecure business units. Additional information is available at www.powersecure.com.