Letter to the Shareholders

April 13, 2009

We are pleased to report that 2008 was a record year for MOCON in several ways.

2008 Business Performance
Net sales for 2008 were $29.7 million, a new record, and 8% increase over 2007. Net income was a record $4.1 million for the year ended December 31, 2008, as compared to $3.8 million for the year ended December 31, 2007, and diluted net income per share was $0.72 and $0.67 for the same periods.
• Our R&D funding resulted in the introduction of eight new products in 2008
• We reported our 82nd quarter of consecutive dividends
• 2008 included our 109th consecutive quarter of profitability
• The Company is financially strong and maintains a solid balance sheet
• 2008 Awards - Listed in the Top 100 Public Company Performance Report as published in the Minneapolis/ St. Paul Business Journal, December 2008
- Ranked #24 in Minnesota Public Company Stock Performance as published in the Minneapolis/St. Paul Business Journal, January 2009worldwide.

In this challenging economic climate, we will continue to closely monitor our sales order activity and make appropriate adjustments as may be necessary to mitigate the effect of a downturn in sales. Our ability to remain profitable during these difficult times is a function of the strong strategic foundation that we have established over the past decade. MOCON is the pre-eminent leader in most of our niche markets. We have a solid product pipeline and distribution system worldwide and a strong balance sheet with minimal debt. We have built a strong brand known for quality, reliability, customer service and innovation. MOCON continues to generate solid operating cash flows. Cash and investments rose to $16.1 million in 2008, from $15.0 million at the end of 2007. Cash flow from operating activities was $3.6 million in 2008.

MOCON and the Current Economy
While MOCON is not immune to economic trends, we plan to continue to grow the Company while maintaining a strong balance sheet. We intend to continue to pay dividends to shareholders, and to constantly evaluate emerging opportunities. MOCON excels in applying our advanced technologies to emerging needs in the marketplace. We look to applications such as air quality monitoring, process stream improvement, homeland security, food and beverage packaging, oil exploration, testing and the monitoring of specific gases for continued growth. Worldwide industrial processing facilities are being constructed or updated and MOCON is there pursuing opportunities. Great products are in the hands of an experienced sales and marketing team.

Worldwide Market Drivers
We concentrate on applications where MOCON can offer technology to provide data, answers and solutions. Concerns over higher energy costs, improvements to food and beverage safety, improved worker safety, new environmental initiatives and homeland security have become hot topics in the world today.

Strategically we strive to:
• Achieve and maintain a leadership position in the niches in which we compete
• Innovate wherever possible, especially in the technical area
• Differentiate ourselves from the competition

We are fortunate to be well-positioned globally with outstanding sales, service and application support. Over the past 40 years, MOCON has built a trusted brand name. With over 70 patents issued and 57 more pending, the Company has a strong technology and intellectual property base. Funding for new product development in the range of 6 - 8 % of revenues have proven to be fruitful. The eight new products we introduced this year are focused on our major niche markets including industrial gas monitoring, package integrity testing and permeation study of barrier materials. A major initiative for MOCON is to enter larger markets with new products.

Foreign sales have significantly contributed to our success. We derived over 56% of our sales from our international markets in 2008, and many offer continued growth opportunities. In addition to our traditional markets, we have experienced growth involving specific applications that could use MOCON equipment globally. Penetrating new niche markets requires time and technology. Our reputation is strong, our products are targeted and we expect to gain market share in this economic environment.

We continue to develop products and applications internally with a dedicated staff of research and development professionals located at MOCON facilities around the world. We continue to review opportunities, as we have in the past, to acquire patents, products, people or technology that make sense to the Company’s growth. Our product pipeline has never been stronger.

Management is Prepared
The MOCON management team has long-term experience in our markets and has excelled in both good and bad times. Prospective customers in a variety of markets continue to demonstrate interest in MOCON products and services, although they may prove hesitant to place orders due to the cautious attitude toward capital expenditures. Lead times in closing sales may be longer than normal. A depth of knowledge in development, marketing, finance, administration, and manufacturing should provide confidence that the Company is prepared for a challenging 2009.

2009 Outlook
The times we are experiencing are unprecedented. Economic uncertainty is all around us. MOCON management is confident that our strong balance sheet, product portfolio and our global presence will aid us during these times to be successful in relative terms. Our entire staff in marketing, administration, finance, development and production are appropriately sized, and we will be aggressive in pursuing our goals. Financial metrics have been unusual in these past months and that may continue in 2009. This management team is one of realists, visionaries, and optimists, with industry-sharpened experience. We are fiscally conservative, persistent planners and offer a solid business model known to MOCON shareholders for many years.

Customers should know that MOCON is committed to service and support. Shareholders should know that their patience and confidence is appreciated, and we extend sincere thanks for the efforts by our employees and representatives during these trying times.

Sincerely,
Robert L. Demorest
Chairman, President and Chief Executive Officer
April 13, 2009

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