SPACEHAB Outlook Remains Positive With Backlog at $173 Million

Company Aggressively Pursuing New Business Opportunities

SPACEHAB, Incorporated, a leading provider of commercial space services, today
announced that the Company’s large backlog and new business opportunities
support positive results and continued growth.

With over $173 million in business backlog and a strengthened balance
sheet, SPACEHAB continues to focus on the utilization of its existing asset
base and the delivery of strong financial and operating results going forward.
“In the wake of the Columbia tragedy this is a difficult time for the space
industry,” said SPACEHAB President and Chief Operating Officer, Michael E.
Kearney. “Despite this challenge, we are able to respond to NASA’s near- and
long-term requirements for both the Space Shuttle and International Space
Station programs, while remaining financially sound and leveraging our strong
core competencies.”

SPACEHAB Continues Work for NASA and Boeing

In support of NASA, SPACEHAB continues with day-to-day operations under
the Research and Logistics Mission Support (ReALMS) contract for the STS-116
and STS-118 missions, important contributions to the completion of
International Space Station (ISS) assembly. SPACEHAB is providing a Logistics
Single Module and an Integrated Cargo Carrier to support resupply requirements
for the orbiting space station. Once NASA announces new launch dates for these
flights, the Company will negotiate adjustments to the contract to compensate
for expenses incurred from launch delays.

For the upcoming STS-114 mission SPACEHAB is providing a unique cargo
carrier, known as the External Stowage Platform 2, or ESP2, that will be
deployed and mounted to the space station. This platform will be attached to
the ISS airlock and used by the astronaut crews as a permanent spare parts
stowage facility. Under contract to The Boeing Company for these services,
SPACEHAB also anticipates receiving compensation for expenses resulting from
launch delays.

SPACEHAB remains committed to the ISS Program in support of NASA’s
initiatives and is able to provide logistics, research, or a combination of
both services within a single mission. By fully utilizing the Company’s
pressurized modules and unpressurized carriers, SPACEHAB is equipped to
support NASA in its transition from ISS assembly to operations. SPACEHAB is
further prepared to add existing functionality to its fleet of assets to
enhance the capabilities already vital to the human spaceflight mission.

Astrotech Division Benefiting From Growth Momentum

Building on 18 years of service to the launch industry, SPACEHAB’s
Astrotech subsidiary is projecting an increase in payload processing activity
at all three of its operating locations during the coming fiscal year. Long-
term contracts are in place with Lockheed Martin, Boeing, and United States
Sea Launch in support of the Atlas, Delta, and Sea Launch programs
respectively. Additionally, active negotiations are underway to secure
processing contracts in support of government customers thereby expanding
Astrotech’s existing business base. Two missions are currently in the
processing queue, the Astrium-built HellasSat spacecraft and the Boeing-built
AsiaSat-4 spacecraft, both projected for liftoff on Atlas launch vehicles
later this spring. Astrotech’s sales have more than doubled over the past two
years and are expected to continue growing going forward.

Growing New Business Opportunities

NASA is in the process of consolidating 26 current contracts into seven in
an effort to optimize synergies within the ISS Program, competitive sourcing,
and program accountability. Of the seven procurement opportunities outlined by
NASA, the Company is poised to effectively compete on at least three of the
ISS Program Management contracts classified as ‘A’ through ‘G’. Contracts
targeted by SPACEHAB include Program Integration and Control, ISS Mission
Integration, and ISS Cargo Missions.

NASA’s Space Launch Initiative includes an investigation of an Alternate
Access to Station system. SPACEHAB holds key subcontractor roles on two of the
four prime contractor teams. The Company’s responsibility is to apply its core
competencies in logistics integration and operations. Through SPACEHAB’s
participation in this study, the Company has developed strategic partnerships
to support NASA’s Orbital Space Plane concept development activities set to
begin in April.

SPACEHAB’s unique capability and existing relationship with RSC Energia in
Russia has resulted in a request for the Company’s expertise. With the
temporary grounding of the Space Shuttle, SPACEHAB anticipates providing NASA
with valuable resupply services in order to ensure the orbiting ISS crew
receives the provisions necessary to sustain operations. Food, scientific
equipment, and critical supplies will be shipped by SPACEHAB for transport to
the ISS on upcoming Soyuz and Progress missions.

With more than $100 million in annual revenue, SPACEHAB, Incorporated is a
leading provider of commercial space services. The Company develops, owns, and
operates habitat and laboratory modules and cargo carriers aboard NASA’s Space
Shuttles. Its Johnson Engineering subsidiary provides orbiter crew compartment
integration, ISS stowage and configuration management, supports astronaut
training, and builds space-flight mockup trainers at NASA’s Johnson Space
Center in Houston. SPACEHAB’s Astrotech subsidiary provides commercial
satellite processing services at facilities in California and Florida.
Additionally, through The Space Store, Space Media provides space merchandise
to the public and space enthusiasts worldwide (http://www.thespacestore.com).

This release contains forward-looking statements that are subject to
certain risks and uncertainties that could cause actual results to differ
materially from those projected in such statements. Such risks and
uncertainties include, but are not limited to, whether the Company will fully
realize the economic benefits under its NASA and other customer contracts, the
timing and mix of Space Shuttle missions, the successful development and
commercialization of new space assets, technological difficulties, product
demand, timing of new contracts, launches and business, market acceptance
risks, the effect of economic conditions, uncertainty in government funding,
the impact of competition, and other risks detailed in the Company’s
Securities and Exchange Commission filings.

     FOR MORE INFORMATION:
     Haris Tajyar                          Julia A. Pulzone
     Managing Partner                      Chief Financial Officer
     Investor Relations International      SPACEHAB, Inc. -- Washington Office
     Phone 818.981.5300                    Phone 202.488.3500
     Fax 818.981.5303                      Toll free 888.647.9543
     htajyar@irintl.com                    pulzone@hqspacehab.com