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<SEC-DOCUMENT>0000950152-07-006236.txt : 20070731
<SEC-HEADER>0000950152-07-006236.hdr.sgml : 20070731
<ACCEPTANCE-DATETIME>20070731165600
ACCESSION NUMBER:		0000950152-07-006236
CONFORMED SUBMISSION TYPE:	8-K/A
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20070730
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Regulation FD Disclosure
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20070731
DATE AS OF CHANGE:		20070731

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			GRAHAM CORP
		CENTRAL INDEX KEY:			0000716314
		STANDARD INDUSTRIAL CLASSIFICATION:	GENERAL INDUSTRIAL MACHINERY & EQUIPMENT [3560]
		IRS NUMBER:				161194720
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0331

	FILING VALUES:
		FORM TYPE:		8-K/A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-08462
		FILM NUMBER:		071013278

	BUSINESS ADDRESS:	
		STREET 1:		20 FLORENCE AVE
		STREET 2:		POST OFFICE BOX 719
		CITY:			BATAVIA
		STATE:			NY
		ZIP:			14020
		BUSINESS PHONE:		5853432216

	MAIL ADDRESS:	
		STREET 1:		20 FLORENCE AVENUE
		STREET 2:		POST OFFICE BOX 719
		CITY:			BATAVIA
		STATE:			NY
		ZIP:			14021-0719
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K/A
<SEQUENCE>1
<FILENAME>l27285ae8vkza.htm
<DESCRIPTION>GRAHAM CORPORATION   8-K/A
<TEXT>
<HTML>
<HEAD>
<TITLE>Graham Corporation   8-K/A</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
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<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>
<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 1pt solid black; font-size: 1pt">&nbsp;</DIV>




<DIV align="center" style="font-size: 14pt; margin-top: 12pt"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</B>
</DIV>

<DIV align="center" style="font-size: 12pt"><B>WASHINGTON, D.C. 20549</B>
</DIV>

<DIV align="center" style="font-size: 18pt; margin-top: 12pt"><B>FORM 8-K/A</B>
</DIV>


<DIV align="center" style="font-size: 12pt; margin-top: 12pt"><B>CURRENT REPORT<BR>
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Date of Report (Date of earliest event reported):&nbsp;&nbsp;<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>July&nbsp;30, 2007</B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>
</DIV>

<DIV align="center" style="font-size: 24pt; margin-top: 12pt"><B>Graham Corporation</B>
</DIV>

<DIV align="center"><DIV style="font-size: 3pt; margin-top: 1pt; width: 100%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

<DIV align="center" style="font-size: 10pt">(Exact name of Registrant as specified in its charter)</DIV>


<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="30%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><B>Delaware</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>1-8462</B>
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top"><B>16-1194720</B></TD>
</TR>
<TR style="font-size: 1px">
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top">(State or other jurisdiction of <BR>
incorporation)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(Commission<BR>
File Number)
</TD>
    <TD>&nbsp;</TD>
    <TD align="center" valign="top">(IRS Employer<BR>
Identification No.)</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>

<DIV align="center">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="80%">&nbsp;</TD>
    <TD width="5%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="7%">&nbsp;</TD>
</TR>
<!-- End Table Head -->
<!-- Begin Table Body -->
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px"><B>20 Florence Avenue, Batavia, New York</B>
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top"><B>14020</B></TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR style="font-size: 1px">
    <TD align="center" valign="top" style="border-top: 1px solid #000000"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="right" valign="top">&nbsp;</TD>
    <TD align="right" valign="top" style="border-top: 1px solid #000000">&nbsp;</TD>
    <TD nowrap valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">(Address of principal executive offices)
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD nowrap colspan="3" align="center" valign="top">(Zip Code)
</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 12pt">Registrant&#146;s telephone number, including area code:&nbsp;&nbsp;<u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>(585)&nbsp;343-2216</B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</u>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>N/A</B>
</DIV>

<DIV align="center"><DIV style="font-size: 3pt; margin-top: 1pt; width: 100%; border-top: 1px solid #000000">&nbsp;</DIV></DIV>

<DIV align="center" style="font-size: 10pt">(Former name or former address, if changed since last report)</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the Registrant under any of the following provisions:
</DIV>


<DIV align="left" style="margin-left: 0%; text-indent: 0%; margin-right: 0%; font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Written communications pursuant to Rule&nbsp;425 under the Securities Act (17 CFR 230.425)</DIV>


<DIV align="left" style="margin-left: 0%; text-indent: 0%; margin-right: 0%; font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange Act (17 CFR 240.14a-12)</DIV>


<DIV align="left" style="margin-left: 0%; text-indent: 0%; margin-right: 0%; font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule&nbsp;14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</DIV>


<DIV align="left" style="margin-left: 0%; text-indent: 0%; margin-right: 0%; font-size: 10pt; margin-top: 6pt"><FONT face="Wingdings">&#111;</FONT> Pre-commencement communications pursuant to Rule&nbsp;13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))</DIV>


<DIV style="width: 100%; border-bottom: 1pt solid black; margin-top: 10pt; font-size: 1pt">&nbsp;</DIV>
<DIV style="width: 100%; border-bottom: 2pt solid black; font-size: 1pt">&nbsp;</DIV>





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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<I>Explanatory Note.</I>&nbsp;&nbsp;<I>This amendment updates the Current Report on </I><I>Form 8-K</I><I> furnished by the
Registrant on July&nbsp;30, 2007.</I>
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;2.02. Results of Operations and Financial Condition.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On July&nbsp;30, 2007, Graham Corporation (the &#147;Company&#148;) held its previously scheduled conference
call to report its results of operations and financial condition for its first quarter ended June
30, 2007. In accordance with the Company&#146;s standard practice, the call consisted of two parts.
The first part of the call was a pre-recorded management presentation that reviewed the Company&#146;s
results of operations and financial condition for its first quarter ended June&nbsp;30, 2007. The
second part of the call was a live question and answer session.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due to an error made by the service provider retained by the Company to record the management
presentation, the pre-recorded management presentation that played during the first part of the
call was an incomplete, unfinished recording. While the presentation was playing, the Company&#146;s
management team realized that the wrong recording was playing and they immediately stopped the
recording. This action resulted is several minutes of silence during the call that continued until
the second part of the call featuring the live question and answer session commenced.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company&#146;s management team did not intend for the incomplete, unfinished recording to play
during the call. The Company&#146;s management team had previously recorded a complete, finished
recording of its management presentation that was supposed to play during the first part of the
call. The complete, finished version of the pre-recorded management presentation that should have
been played during the call is now available on the Company&#146;s website (<u>www.graham-mfg.com</u>). In
addition, a transcript of the complete, finished version of the pre-recorded management
presentation that should have been played during the call is attached to this Current Report on
Form 8-K as Exhibit&nbsp;99.1 and is incorporated by reference herein. The Company&#146;s management team
strongly encourages stockholders and other interested parties to listen to the complete, finished
version of the pre-recorded management presentation available on the
Company&#146;s website or
review the transcript of the complete, finished version of the pre-recorded management presentation
attached to this report.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;7.01. Regulation&nbsp;FD Disclosure.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The information set forth above under Item&nbsp;2.02 hereof and below under Item&nbsp;9.01 hereof is
hereby incorporated hereunder by this reference.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 12pt"><B>Item&nbsp;9.01. Financial Statements and Exhibits.</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;Exhibits.
</DIV>
<DIV align="right">
<TABLE style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="95%">
<!-- Begin Table Head -->
<TR valign="bottom">
    <TD width="10%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="88%">&nbsp;</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom">
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Exhibit No.</TD>
    <TD>&nbsp;</TD>
    <TD nowrap align="center" style="border-bottom: 1px solid #000000">Description</TD>
</TR>

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<TR valign="bottom"><!-- Blank Space -->
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">&nbsp;</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">&nbsp;</TD>
</TR>
<TR valign="bottom">
    <TD align="center" valign="top"><DIV style="margin-left:0px; text-indent:-0px">99.1
</DIV></TD>
    <TD>&nbsp;</TD>
    <TD align="left" valign="top">Complete transcript of Graham Corporation conference call
regarding its results of operations and financial condition
for its first quarter ended June&nbsp;30, 2007.</TD>
</TR>
<!-- End Table Body -->
</TABLE>
</DIV>



<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
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<DIV style="font-family: 'Times New Roman',Times,serif">




<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>SIGNATURES</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
</DIV>

<TABLE width="100%" border="0" cellspacing="0" cellpadding="0" style="font-size: 10pt">
<TR>
    <TD width="48%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="35%">&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
</TR>
<TR>
    <TD valign="top" align="left">&nbsp;</TD>
    <TD colspan="3" align="left"><B>Graham Corporation</B><BR>
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">Date:  July 31, 2007&nbsp;</TD>
    <TD valign="top">By:&nbsp;&nbsp;</TD>

<TD colspan="2" style="border-bottom: 1px solid #000000" align="left">/s/
J. Ronald Hansen
&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">J. Ronald Hansen&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR><TR>
    <TD align="left">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD colspan="2" align="left">Vice President -- Finance &#038; Administration and
Chief Financial Officer&nbsp;</TD>
    <TD>&nbsp;</TD>
</TR>
<TR>
    <TD colspan="5">&nbsp;</TD>
</TR>
</TABLE>


<P align="center" style="font-size: 10pt"><!-- Folio -->&nbsp;<!-- /Folio -->
</DIV>


</BODY>
</HTML>
</TEXT>
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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>l27285aexv99w1.htm
<DESCRIPTION>EX-99.1
<TEXT>
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<HEAD>
<TITLE>EX-99.1</TITLE>
</HEAD>
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<DIV style="font-family: 'Times New Roman',Times,serif">


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><U>EXHIBIT 99.1</U>
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt">COMPLETE TRANSCRIPT OF GRAHAM CORPORATION<BR>
CONFERENCE CALL REGARDING ITS<BR>
RESULTS OF OPERATIONS AND FINANCIAL CONDITION<BR>
FOR ITS FIRST QUARTER ENDED JUNE 30, 2007
</DIV>



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<DIV align="left" style="font-size: 10pt; margin-top: 12pt">GHM Q108 Earnings Teleconference Call
</DIV>


<DIV align="center" style="font-size: 10pt; margin-top: 18pt"><B>Graham Corporation<BR>
First Quarter Fiscal 2008 Earnings Conference Call<BR>
July&nbsp;30, 2007</B>
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Operator: </B>Good morning, ladies and gentlemen. My name is Nia, and I will be your conference
operator today. At this time, I would like to welcome everyone to the Graham Corporation First
Quarter Fiscal 2008 Earnings Conference Call. All lines have been placed on mute to prevent any
background noise. After the speakers&#146; remarks, there will be a question and answer session. If
you would like to pose a question during this time, please press star, then the number one on your
telephone key pad. If you would like to withdraw your question, press the pound key.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Thank you. It is now my pleasure to turn the floor over to your host, Deborah Pawlowski, Investor
Relations for Graham. Ma&#146;am, you may begin your conference.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Deborah Pawlowski: </B>Thank you and good morning everyone. We appreciate your time with us here
today. You should have a copy of the news release that details Graham&#146;s financial results for the
first quarter of fiscal 2008 that we released this morning. If not, you can obtain a copy from the
Company&#146;s website at: <U>www.graham-mfg.com</U>. With me here today are Graham&#146;s President and Chief
Operating Officer, James Lines, and Chief Financial Officer, Ron Hansen. Jim and Ron will provide
their planned comments first and then we will open it up for questions.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">As you are aware, we may make forward-looking statements, both during the call and in the following
question and answer period. These forward-looking statements are not guarantees of future
performance and are subject to risks and uncertainties as well as other factors that could cause
actual results to differ materially from what we discuss here today. These risks and uncertainties
are available for you in the press release itself, as well as with filings the Company has made
with the Securities and Exchange Commission.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">So, with that, let me turn it over to Jim to begin the review and discussion.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Jim Lines: </B>Thank you, Debbie and good morning everyone.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Results for the first quarter were strong. At $20&nbsp;million, we set a record for our first quarter
sales and exceeded our prior best of $15.2&nbsp;million by 32%. We also surpassed our $19.5&nbsp;million
first quarter operating plan.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Outsourcing is on target at 15% of production. Our production environment has improved over the
past several quarters which has lead to greater throughput and margin improvement. Production
efficiency today is superior to what it was 12 to 18&nbsp;months ago.
</DIV>

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<DIV align="left" style="font-size: 10pt; margin-top: 12pt">GHM Q108 Earnings Teleconference Call
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Gross margin in the first quarter was 33.4%, a 520 basis point gain from the first quarter of
fiscal 2007, and sequentially from the fourth quarter of fiscal 2007, a 420 basis points gain. The
improvement in gross margin is primarily due to market pricing discipline, material costs controls,
production improvements and fewer lower margin orders this quarter.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">With regards to materials cost control, material costs have remained volatile. Supply chain
management, equipment estimating and the engineering groups have done well to stay on top of
commodity cost movements.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">With regards to increased production efficiency, our production environment has dramatically
improved. Operating leverage due to greater throughput and outsourcing benefited gross margin as
well.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">And lastly, gross margin is improving now that we have completed most of the lower margin orders
that were booked January through May&nbsp;2006.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Backlog also increased during the quarter, and bookings exceeded shipments by $4.8&nbsp;million.
Backlog is now at $59.2&nbsp;million, and we forecast that approximately 75% of it will convert to
revenue this fiscal year. We believe the quality of margins in the backlog is superior to those
from 2006 and 2007. We have shipped virtually all poor quality margin work, with just a small
amount shipped in the second quarter.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Operating margin of 19.2%, and earnings per share in the quarter of $0.60, demonstrates the
earnings power of our business model.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We are continuing to make progress toward improved cash management. Operating working capital per
sales dollar stood, at the end of the quarter, below 6%, down from 16% in 2004. Our cash
conversion cycle is under 50&nbsp;days, as of June&nbsp;30<SUP style="font-size: 85%; vertical-align: text-top">th</SUP>, and that compares with 134&nbsp;days in
2004. The improvement was been driven by favorable payment terms negotiated on new orders, reduced
inventory, an aggressive receivables collection policy and improved production cycle time.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">I am pleased to also announce that Alan Smith has joined the Company as Vice-President of
Operations. He is an excellent addition to the team. Alan has 14&nbsp;years experience with Graham and
was Engineering Manager when he left in early 2005. Prior to his return, Alan was Director of
Operations at Lydall, Inc. In the Vice-President of Operations capacity, Alan will lead supply
chain management, manufacturing technology, quality assurance and production
areas. His priorities will include expanding production capacity, lowering material costs,
improving upon our already high quality standards, developing a robust and sustainable production
environment, and lastly, having on-time performance, a core competence and differentiator for the
Company.
</DIV>

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<DIV align="left" style="font-size: 10pt; margin-top: 12pt">GHM Q108 Earnings Teleconference Call
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">I remain positive about the bookings pipeline for the next 18 to 24&nbsp;months. We anticipate
continued strong demand coming from the refining and petrochemical sectors. Product demand for
projects in the Middle East and Asia are anticipated to be high, and equally important, is that we
expect excellent opportunities in North America from the refining sector to continue.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">I believe 2008 will be another year for growth, with revenue increasing 10% to 15% as compared with
fiscal 2007, and anticipate that the actual increase will be nearer to the higher side of the
range. Net income is expected to increase at a rate that is above our top line growth rate.
Beyond 2008, we expect 2009 will provide continued growth. I feel the business is running well and
can be improved further. There is strong demand for our products and services. I&#146;m optimistic
about the future outlook for our Company.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">With that, I&#146;ll turn it over to Ron.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt"><B>Ron Hansen: </B>Thank you Jim, and good morning. Sales for the first quarter of fiscal 2008 were $20
million, up 37% from the first quarter of fiscal 2007. Our first quarter has historically been a
weak one. However, given the large backlog and our successes in improving process flow and
increasing capacity, we were able to recognize greater revenue this quarter.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Approximately 48% of sales in the first quarter were for oil refinery projects, while 23% were for
petrochemical and chemical projects and the remaining 29% for other applications.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Domestic sales represented 46% of first quarter sales, and 54% of our sales were for export. Of
significance, projects in the Middle East accounted for 21% of sales; 13% were for projects from
Canada and another 13% were for projects in Asia. We believe shifts and weightings by industry and
geographic markets from quarter-to-quarter are often simply a function of timing.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">We continue to see strong capital spending in our primary industry sectors for our products on a
global basis.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Our gross profit for the first quarter was 33.4%. SG&#038;A expenses for the first quarter were $2.8
million, or 14.2%, of sales compared with $2.3&nbsp;million, or 17%, of sales for the prior year&#146;s first
quarter. We continue to anticipate SG&#038;A expenses to be in the range of $2.8 to $3.1&nbsp;million per
quarter in fiscal 2008.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The effective tax rate for the first quarter was 31%, lower than we previously discussed due to an
accumulative adjustment in our deferred tax liabilities resulting from a statutory lowering of New
York State income taxes for manufacturers. We expect the full year&#146;s effective tax rate to be
approximately 33%.
</DIV>

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<DIV style="font-family: 'Times New Roman',Times,serif">

<DIV align="left" style="font-size: 10pt; margin-top: 12pt">GHM Q108 Earnings Teleconference Call
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">&nbsp;
</DIV>


<DIV align="left" style="font-size: 10pt; margin-top: 6pt">The benefits of steps taken last year materialized this quarter with net income of $2.7&nbsp;million, or
$0.66 per diluted share. This compares with the first quarter of fiscal of 2007, with net income
of $1.1&nbsp;million, or $0.29 per diluted share.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Net cash provided by operating activities for the first quarter of fiscal of 2008 was $5&nbsp;million
compared with net cash used by operating activities of $2.5&nbsp;million for the first quarter of fiscal
2007. Greater net income, non-cash expense (e.g., deferred income taxes) and being able to manage
the Company with less operating working capital, due to steps taken to lower our cash conversion
cycle, enabled this to occur.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">As mentioned in the past, I again caution you that we are not a business that can be viewed in
90-day sound bytes or on any specific day, and thus, on future quarter end periods, working capital
levels compared with prior quarters could result in less favorable information.
</DIV>

<DIV align="left" style="font-size: 10pt; margin-top: 6pt">Capital expenditures for the first quarter of fiscal 2008 were $163,000, and depreciation was
$231,000. For the year, we expect capital expenditures to be about $1.5&nbsp;million and depreciation
approximately $927,000.
</DIV>


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