October 10, 2008

KMG Chemicals Named to Forbes List of America’s 200 Best Small Companies

KMG Chemicals, Inc. (NASDAQ: KMGB), a global provider of specialty chemicals in niche markets, today announced that for the second consecutive year, it has been named one of "America's 200 Best Small Companies" by Forbes magazine. KMG was ranked #167. The entire list appears in the October 27, 2008 issue of Forbes. Online access is at: http://www.forbes.com/lists/2008/23/ biz_200smalls08_The-200-Best-Small-Companies_Company_5.html (Due to its length, this URL may need to be copied/pasted into your Internet browser's address field. Remove the extra space if one exists.)

To qualify for the Forbes list, candidates must have sales of between $5 million and $750 million and a stock price of $5 as of Sept. 29. The ranking is based on return on equity, sales growth and profit growth over the past 12 months and also over five years. Forbes also compared candidates' stock performance with that of its industry peers.

KMG's President & CEO Neal Butler said, "We are very honored to be recognized as one of 'America's Best 200 Small Companies'. This ranking reflects the hard work, dedication and commitment of every employee at KMG Chemicals. Our challenge going forward is to continue to grow KMG and maximize investor return. It is a commitment that drives our long range strategies and day to day operational activities."

About KMG

KMG Chemicals, Inc., through its subsidiaries, produces and distributes specialty chemicals to niche markets. The Company grows by acquiring and optimizing stable chemical product lines and businesses with established production processes. Its current operations are focused on the wood treatment, electronic, and agricultural chemical markets. For more information, visit the Company's web site at www.kmgchemicals.com.