GVI Security Solutions Reports Third Quarter 2006 Results.

CARROLLTON, Texas -- GVI Security Solutions, Inc. (OTCBB:GVIS), a leading provider of video security surveillance solutions featuring the complete Samsung Electronics line of products, today reported financial results for the third quarter ended September 30, 2006.

Revenue was $10.1 million and $32.9 million, respectively, for the three and nine months ended September 30, 2006. This compares to $10.9 million and $31.1 million for the same periods in the prior year. Net loss for the three and nine months ended September 30, 2006 was $3.0 million and $10.0 million, respectively, as compared to $2.6 million and $5.9 million in the prior year. Net loss for the three and nine months ended September 30, 2006 reflected net income from discontinued operations of $576,000 and net loss from discontinued operations of $2.7 million, respectively. In comparison, net loss for the three and nine months ended September 30, 2005 reflected net income from discontinued operations of $147,000 and $1.5 million, respectively.

Revenue from continuing operations was adversely impacted in the third quarter by reduced inventory levels of Samsung products due to a reduction in GVI's credit limit with Samsung and accumulated past due amounts then owing to Samsung. However, in the beginning of the fourth quarter, Samsung resumed shipments to GVI.

During the past nine months, GVI has focused its operations on its core business competence: the distribution of security products to the professional channel, which provides video security solutions for the commercial and homeland security markets. As part of this focus, GVI previously announced its decision to withdraw from the retail market segment. Consistent with these actions, during the third quarter, GVI reached an agreement with its former retail distributor which resulted in GVI's transfer of $500,000 in remaining retail inventory and the termination of GVI's obligation to accept future retail merchandise returns; an obligation which had been projected to be as high as $1.1 million. GVI also achieved substantial cost savings during the third quarter by reducing sales, marketing, promotional and trade show expenses.

During the third quarter, GVI took non-cash charges of approximately $1 million as a result of the write down of assets associated with its Rapor products, and additional non-cash charges of $1 million associated with the write down of slow moving inventory. Excluding these non-cash charges, cost of goods sold in the third quarter would have been $8.4 million yielding gross margins of 16.1% of sales, versus the reported $9.4 million of cost of goods sold which yielded gross margins of 6.2%.

Following the completion of the quarter, as previously announced, GVI:

* completed a private placement generating $5,000,000 in gross proceeds,

* restructured its debt with Laurus,

* reconstituted its board of directors with five new members, and

* entered into a new distribution agreement with Samsung which grants GVI the right to distribute Samsung's complete line of professional video surveillance and security products in North, Central and South America through December 31, 2010.

"We believe the significant actions we took in the third quarter position us for improved results moving forward," said GVI Chief Executive Officer Steven Walin. "Our new agreement strengthens and extends our relationship with Samsung and provides us with the capability to increase sales. Restructuring our bank debt, completing a $5 million private placement and terminating our remaining obligations with respect to retail channel sales have alleviated the pressures that had been placed on the Company. Moving forward, we are now fully focused on returning to the Company's core competency of selling video surveillance solutions to the commercial and homeland markets."

About GVI Security Solutions, Inc.

GVI Security Solutions Inc. is a leading provider of video surveillance security solutions to the homeland security, institutional and commercial market segments.

Forward-Looking Statements:

Some of the statements made by GVI Security Solutions, Inc. in this press release are forward-looking in nature. Forward-looking statements in this press release are not promises or guarantees and are subject to risks and uncertainties that could cause our actual results to differ materially from those anticipated. These statements are based on management's current expectations and assumptions and are naturally subject to uncertainty and changes in circumstances. We caution you not to place undue reliance upon any such forward-looking statements. Actual results may differ materially from those expressed or implied by the statements herein. GVI Security Solutions, Inc. believes that its primary risk factors include, but are not limited to: reliance on primary supplier; effective integration of recently acquired operations and personnel; expansion risks; effective internal processes and systems; the ability to attract and retain high quality employees; changes in the overall economy; rapid change in technology; the number and size of competitors in its markets; outstanding indebtedness; control of the Company by principal stockholders; law and regulatory policy; the mix of products and services offered in the company's target markets; and other factors detailed in the Company's filings with the Securities and Exchange Commission, including the Annual Report on Form 10-KSB for the year ended December 31, 2005 currently on file, as well as the risk that projected business opportunities will fail to materialize or will be delayed.