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FOR IMMEDIATE RELEASE

SPACEHAB REPORTS FIRST QUARTER 2002 RESULTS
Loss Cut 49 Percent, Debt Reduced $5.1 MM, New Module Missions Being Priced

November 7, 2001, Washington, D.C. - SPACEHAB, Inc. (NASDAQ/NMS: SPAB), a leading provider of commercial space services, today announced financial results for the first quarter of fiscal 2002, ended September 30, 2001. SPACEHAB reported a net loss of $2.9 million ($0.24 per basic and diluted share) for the quarter, a 49 percent reduction from the net loss of $5.6 million ($0.49 per basic and diluted share) reported for the previous quarter.

SPACEHAB recorded revenues of $22.3 million for first quarter 2002 versus $29.9 million for fourth quarter 2001 and $27.0 million for first quarter 2001. Gross profit was equal to $2.4 million for first quarter 2002 versus $2.8 million for fourth quarter 2001 and $4.4 million for first quarter 2001.

While revenue declined between fourth quarter 2001 and first quarter 2002, gross profit improved from 9.5 percent of revenue to 10.9 percent of revenue in the first quarter due to cost reduction efforts begun in fiscal 2001. The decline in revenue is primarily attributable to changes in the mix of business within SPACEHAB's Space Flight Services and Johnson Engineering business segments. First quarter 2002 operating expenses declined 18 percent from first quarter 2001, a direct result of company-wide cost reduction efforts. Operating expenses increased 16 percent, from $4.3 million in fourth quarter 2001 to $5.0 million in first quarter 2002, a result of investment in new business development. Noncash charges totaled $3.4 million for first quarter 2002.

First quarter 2002 earnings before interest, taxes, depreciation and amortization (EBITDA) were $1.9 million, compared to $2.4 million for fourth quarter 2001 and $0.5 million for first quarter 2001. For first quarter 2002, SPACEHAB recorded a small provision for income taxes and no tax benefit for utilization of current period tax losses in future periods. In first quarter 2001, SPACEHAB recorded a $780,000 tax benefit equal to $0.07 per share.

"Our first quarter 2002 results reflect continued progress toward improving liquidity and returning to profitability," said SPACEHAB Senior Vice President, Finance and Chief Financial Officer Julia Pulzone. "We have executed the remaining elements of our financial plan disclosed with our year end financial results, and we are managing our business to exceed our baseline financial plan established in June 2001 for fiscal year 2002. While continuing to meet commitments to our customers and vendors, SPACEHAB made more than $5.1 million of principal repayments on debt in the first quarter, and we continue to see improvement in working capital over the previous quarter."

On October 29, 2001, SPACEHAB finalized terms for restructuring of debt with Alenia Spazio S.p.A., lowering the interest rate and extending the term for repayment through 2003. The terms of the restructuring require payments of $4.2 million in the current fiscal year. The remaining balance of $3.7 million will be repaid in future periods.

SPACEHAB reached agreement with Bank of America on October 24, 2001, to restructure the terms and conditions of SPACEHAB's credit facility, including structuring new covenants for the facility.

On August 30, 2001, Astrotech entered into agreements for a $20 million financing of its Florida facility expansion. The financing was completed on September 10. This facility represents a $30 million investment on the part of Astrotech. Construction was completed on the facility, and it was dedicated on October 25, 2001.

In November 2001, SPACEHAB concluded negotiations with NASA on equitable-adjustment payments for STS-107 from October 1, 2001, to the June 2002 current estimated launch date. SPACEHAB also is negotiating pricing with NASA for two new International Space Station resupply missions currently scheduled to launch in 2003; these negotiations are expected to conclude this month.

On September 27, 2001, SPACEHAB's majority-owned subsidiary Space Media, Inc., obtained a $750,000 equity investment. Space Media completed preparations for a new school year with its STARS Academy global education program during first quarter 2001. Subsequent to the first quarter, The Space Store, Space Media's online retail operation, established a partnership with the multimedia company SPACE.com (www.space.com) to create a new distribution channel that will drive revenue by increasing traffic between their respective Web sites. SPACE.com (www.space.com) reports that its Web site receives 20 million page views per month.

Founded in 1984, with more than $100 million in annual revenue, SPACEHAB, Inc., 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. It also supports astronaut training and space station configuration management at NASA's Johnson Space Center in Houston and builds space-flight trainers and mockups. SPACEHAB's Astrotech subsidiary provides commercial satellite processing services at facilities in California and Florida. SPACEHAB's newest strategic growth initiative, SPACEHAB Huntsville, offers customer-focused end-to-end services to the space research community at NASA's Marshall Space Flight Center in Huntsville, Alabama. SPACEHAB subsidiary Space Media, Inc.™, brings space into homes and classrooms worldwide with interactive education programs through STARS Academy (www.starsacademy.com), and space merchandise from The Space Store (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.

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