American Science and Engineering, Inc. Reports Second Quarter Fiscal Year 2003 Results.

Business/Technology Editors

BILLERICA, Mass.--(BUSINESS WIRE)--Nov. 5, 2002

American Science and Engineering, Inc. (AS&E) (AMEX: ASE) will report revenues of $16,935,000, an operating loss of $2,071,000 and a loss per share of $0.10 for the second quarter (ended September 30, 2002) of FY 2003. This represents a 10% increase in revenues and a $0.06 increase in earnings per share versus the second quarter of the previous fiscal year.

Included in other income (expense) for the quarter ended September 30, 2002 is a $1,364,000 credit representing the estimated fair value decrease during the quarter of the outstanding warrants issued in connection with the $19.7 million private placement of common stock. The loss per share before considering this item was $0.30 per share.

Ralph Sheridan, CEO and President commented, "Our efforts in marketing to the military came to fruition this quarter with the receipt of three MobileSearch(TM) systems orders, as well as a Shaped Energy(TM) system award for Pearl Harbor for Force Protection applications. Our gantry design Shaped Energy system responds to the requirement for high throughput inspection and penetration from higher energy and dual-sided Backscatter imaging for ease of cargo clearance. The award of a fixed-site Shaped Energy system for the Egyptian Port of Sokhna signifies the new role for the private sector in taking responsibility for port inspection.

"These CargoSearch(TM) awards increase the total orders for cargo inspection to 77 systems in 10 countries for combating cargo crime and reducing threats posed by weapons of mass destruction, illegal immigration, trade fraud, cargo theft, and drug and weapons smuggling. Moreover, we continue to have strong order flow for parcel systems from government clients for high-threat facilities, as evidenced by recent orders from the DOJ and INS. The long-term focus for AS&E is pioneering cargo inspection systems for ports and borders to address both the threat of terrorism and the magnitude of cargo crime.

"The second quarter operating losses reflect: (1) revenue shortfalls driven by the delays associated with Homeland Defense funding; (2) higher SG&A expenses associated with investments in sales and marketing for Homeland Defense initiatives and; (3) continued investment in R&D, specifically Shaped Energy and Radiation Threat Detection development."

About AS&E(R)

AS&E develops and manufactures sophisticated X-ray inspection products for critical detection and security applications. These systems are solving an expanding range of inspection problems including detecting car and truck bombs, combating weapons smuggling, and imaging cargo to expose trade fraud and illegal immigration. AS&E's patented Z(R) Backscatter technology detects plastic explosives, illegal drugs, and other contraband, even when artfully concealed in complex backgrounds by terrorists and smugglers. AS&E's Shaped Energy(TM) X-ray inspection systems combine material discrimination features of Z(R) Backscatter imaging with the penetration capability of high-energy X-rays for dense cargoes. AS&E's High Energy Systems Division manufactures linear accelerators for a variety of applications including medical, scientific, security, electron beam curing and non-destructive testing. For more information on AS&E products and technologies, please visit http://www.as-e.com.

                AMERICAN SCIENCE AND ENGINEERING, INC.
                    CONSOLIDATED FINANCIAL SUMMARY
      (Dollars and shares in thousands, except per share amounts)
                              (unaudited)

                            Three Months Ended     Six Months Ended

                            Sept. 30,  Sept. 30,  Sept. 30,  Sept. 30,
                              2002       2001       2002       2001
                            --------   --------   --------   --------
Net sales and contract
 revenues                   $16,935    $15,434    $31,853    $34,461

Gross margin                  3,362      3,384      6,852      7,998

Selling, general and
 administrative expenses      3,776      2,905      6,948      5,573

Research and development      1,657      1,597      3,523      3,194
                            --------   --------   --------   --------
Operating loss               (2,071)    (1,118)    (3,619)      (769)

Other income (expense)        1,374       (167)     2,013       (359)
                            --------   --------   --------   --------
Loss before income taxes       (697)    (1,285)    (1,606)    (1,128)

Benefit from income taxes         0       (488)         0       (430)
                            --------   --------   --------   --------
Net loss                    $  (697)   $  (797)   $(1,606)   $  (698)
                            ========   ========   ========   ========
Loss per common share       $ (0.10)   $ (0.16)   $ (0.25)   $ (0.14)
                            ========   ========   ========   ========
Shares used in per share
 calculation                  6,818      5,030      6,395      5,026
                            ========   ========   ========   ========

The results of operations reported herein may not be indicative of future financial conditions or results of future operations.

Safe Harbor Statement

The foregoing press release contains statements concerning AS&E's financial performance, markets and business operations that may be considered "forward-looking" under applicable securities laws. AS&E wishes to caution readers of this press release that actual results might differ materially from those projected in any forward-looking statements. Factors which might cause actual results to differ materially from those projected in the forward-looking statements contained herein include the following: significant reductions or delays in procurements of the Company's systems by the United States and other governments; disruption in the supply of any sole-source component incorporated into the AS&E's products (of which there are several); litigation seeking to restrict the use of intellectual property used by the Company; potential product liability claims against the Company; global political trends and events which affect public perception of the threat presented by drugs, explosives and other contraband; global economic developments and the ability of governments and private organizations to fund purchases of the Company's products to address such threats; and the potential insufficiency of Company resources, including human resources, capital, plant and equipment and management systems, to accommodate any future growth. These and certain other factors which might cause actual results to differ materially from those projected are more fully set forth under the caption "Forward-Looking Information and Factors Affecting Future Performance" in the Company's Annual Report on Form 10-K for fiscal year ending March 31, 2002.