Press Release

OTTAWA, Aug. 6 /CNW Telbec/ - Espial(R) Group Inc. ("Espial" or the "Company"), (TSX:ESP), a leader in the delivery of TV software, today announced its second quarter financial results for the three-month period ended June 30, 2009.

Q2 HIGHLIGHTS:

• Strong expansion orders from current customers increasing live subscriber and set-top box deployments
• Announced that Buffalo Inc. has licensed Evo Client middleware as their set-top box (STB) middleware for their recently launched hybrid set-top box providing digital TV and on-demand services.
• Announced the release of the Espial MediaBase version 9.0 Video-On-Demand (VOD) platform that provides a 400% performance increase with up to 37.5 Gbps streaming from a single next-generation HP or IBM server and extends support for cable operators.
• Major Espial customer recently launched their commercial service and will be announced shortly.

For the three-month period ended June 30, 2009, the Company reported revenues of $3.1 million compared to revenues of $1.8 million for the three months ended June 30, 2008. Earnings before interest, foreign exchange, taxes, stock compensation, depreciation and amortization (EBITDA) for the second quarter of fiscal 2009 was a loss of $0.5 million compared to a loss of $1.4 million in the second quarter of fiscal 2008. Net loss for the quarter was $1.1 million or $0.08 per share, compared to a net loss of $1.4 million last year, or $0.15 per share.

"We are pleased with our second quarter results" noted Jaison Dolvane, President and CEO of Espial. "In Q2, we saw solid expansion orders from our current customers, as they increased their number of deployed subscribers and set-top boxes. We also released version 9.0 of our Espial MediaBase VOD server product. Espial MediaBase enables our customers to add a variety of on-demand services like VOD, Network PVR, RS-DVR, Start-over TV, Look-back TV and Pause live TV from a single, low cost infrastructure. Further, with this latest version, we've increased our already industry leading product performance, while further reducing power and rack space requirements."

Q2 Financial Results

Second quarter revenues were $3,110,403 compared with revenues of $1,827,475 in the same period a year ago. Second quarter software license and royalty revenues were $1,780,734 compared to software license and royalty revenues of $1,243,644 in the second quarter of fiscal 2008. Professional services for the second quarters of 2009 and 2008 were $488,662 and $240,702 respectively. Maintenance and support revenues for the second quarter were $841,007 compared to $343,129 last year.

Gross margins for the second quarter of fiscal 2009 were 75% compared with 71% in the second quarter of fiscal 2008.

Operating expenses in the second quarter of fiscal 2009 were $3,229,577 compared to $2,736,182 in the second quarter of fiscal 2008.

Earnings before interest, foreign exchange, taxes, stock compensation, depreciation and amortization (EBITDA) for the second quarter of fiscal 2009 was a loss of $478,998 compared to a loss of $1,412,930 in fiscal 2008.

Net loss in the second quarter was $1,103,872 compared to a loss of $1,365,135 last year.

Cash and cash equivalents at June 30, 2009 was $8,769,446

The Company will be hosting a conference call to discuss the second quarter financial results on August 6, 2009 at 5:00 PM Eastern Standard Time (EST). The phone number to join the results discussion is:

- Toll line - 416 644 3421

- Toll free line - 800-732-0232

The playback for the call will be available until Tuesday, September 8, 2009 at the following numbers and passcode:

- Toll line: 416-640-1917 - passcode: 21312644 followed by the number sign

- Toll free line: 877-289-8525 - passcode: 21312644 followed by the number sign

About Espial (www.espial.com)

Espial provides scalable and open digital TV software to service providers in the cable, telecommunications and hospitality industries. Its middleware, video-on-demand and browser solutions provide superior service delivery, advanced service innovation tools and the ability to implement flexible business models. Espial serves a range of market segments including, IPTV, Cable, hybrid IP, over-the-top, multi-dwelling unit and enterprise. With over 7 million subscribers using Espial's patented solutions, Espial is a leading supplier of TV software. Espial is headquartered in Ottawa, Canada with offices around the world in USA, Europe and Asia. For more information please visit the Espial website @ www.espial.com

Forward Looking Statement

This press release contains information that is forward looking information with respect to Espial within the meaning of Section 138.4(9) of the Ontario Securities Act (forward looking statements) and other applicable securities laws. In some cases, forward-looking information can be identified by the use of terms such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "intend", "estimate", "predict", "potential", "continue" or the negative of theses terms or other similar expressions concerning matters that are not historical facts. In particular, statements about the benefits and synergies of the Kasenna acquisition transaction, future opportunities for the company and products and any other statements regarding Espial's future expectations, beliefs, goals or prospects are or involve forward-looking information.

Forward-looking information is based on certain factors and assumptions. While the company considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect.

Forward-looking information, by its nature necessarily involves risks and uncertainties, including Espial's ability to effectively integrate Kasenna operations and effectively develop its distribution channels, and generate increased demand for its products. Additional risks and uncertainties affecting Espial can be found in Espial's Annual Report for the fiscal year ended December 31, 2008 and in its most recent quarterly report filed on SEDAR at www.sedar.com. If any of these risks or uncertainties were to materialize, or if the factors and assumptions underlying the forward-looking information were to prove incorrect, actual results could vary materially from those that are expressed or implied by the forward-looking information contained herein.

Espial assumes no obligation to update or revise any forward looking statements, whether as a result of new information, future events or otherwise. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.

Non-GAAP Financial Measures

Earnings before interest, foreign exchange, taxes, stock compensation, depreciation and amortization (EBITDA) is a non-GAAP financial measure that does not have any prescribed meaning by GAAP and is therefore unlikely to be comparable to similar measures presented by other issuers. Management believes that this non-GAAP financial measure, when taken together with the corresponding consolidated GAAP measures, increases the transparency of the Company's current results and enables investors to more fully understand trends in its current and future performance.

For further information: Inquiries from financial press or analysts:

Carl Smith, Chief Financial Officer, Espial Group Inc., Email:

csmith@espial.com, Phone: (613) 566-3427; Kirk Edwardson, Director, Marketing,

Espial Group Inc., Email: kedwardson@espial.com, Phone: (613) 230-4770 x1145