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Medifast Announces First-Quarter 2006 Results
Company Reports All-Time Record Revenues and Profits
Company Increases 2006 Full-Year Guidance

Medifast, Inc. announced today first quarter results for the period ended March 31, 2006. For the quarter ended March 31, 2006, Medifast reported revenue of $19.2 million, a 130% increase from $8.3 million in the first quarter of 2005. The Company reported pre-tax income of $2,819,000, a 230% increase compared to $854,000 for the quarter ended March 31, 2005. The company reported net income of $1,694,000, or $0.13 per basic share ($0.13 per diluted share), versus $507,000 or $0.04 per basic share ($0.04 per diluted share) in 2005. The first quarter of 2006 represented the Company's 26th consecutive quarter of profitability.

The Company had stockholders' equity of $23.7 million and working capital of $11.2 million at March 31, 2006, compared to $19.7 million and $8 million at March 31, 2005.

"We are extremely pleased with the first-quarter results. We continue to expand our successful multi-media advertising program as the low cost to acquire new customers remains encouraging. We are placing emphasis on improved service standards and customer-focused support in both our direct-to- consumer marketing and direct sales health network. We are building the necessary infrastructure throughout 2006 to support sales growth and to better serve our expanding customer base that relies on us for our clinically proven products and programs," said Michael S. McDevitt, Medifast President and Chief Financial Officer.

Bradley T. MacDonald, Medifast Executive Chairman of the Board, stated, "I must give praise to the exceptional leadership of the Executive Management Team. These key executives have done a tremendous job of dramatically increasing revenues while maintaining operational and financial discipline."

2006 Revised Financial Guidance

Previously, the company expected to generate revenue of $58 to $60 million for the year with an after-tax profit of $0.29 - $0.32 per diluted share. The company now expects to generate revenue of $66 to $68 million for the year with after-tax earnings of $0.38 to $0.40 per diluted share.

First Quarter Conference Call

The Company will hold a conference call and webcast at 5:00 PM EDT on May 15, 2006 to discuss first quarter results.

Interested participants should call (800) 261-3417 when calling within the United States or (617) 614-3673 when calling internationally. Please refer to pass code 45199429. There will be a playback available as well. To listen to the playback, please call (888) 286-8010 when calling within the United States or (617) 801-6888 when calling internationally. Please use pass code 81365139 for the replay. The replay will be available until August 15, 2006.

The webcast may be accessed via the Company's web site at Interested parties should go to the section marked "Investor Relations" to listen to the call.

Medifast has been helping people lose weight and achieve better health for 25 years. Its meal replacement foods have been proven effective in multiple clinical studies, recommended by over 15,000 physicians and used by more than 1 million customers. Medifast offers its customers world-class customer service and nutrition support.

This release contains forward-looking statements which may involve known, and unknown risks, uncertainties and other factors that may cause Medifast's actual results and performance in future periods to be materially different from any future results or performance suggested by these statements. Medifast cautions investors not to place undue reliance on forward-looking statements, which speak only to management's expectation on this date.

                     MEDIFAST, INC. AND SUBSIDIARIES

                                         March 31, 2006  December 31, 2005
                                           (Unaudited)          (Audited)
  Current assets:
    Cash                                     $3,793,000       $1,484,000
    Accounts receivable-net of allowance
     for doubtful accounts of $100,000          775,000          985,000
    Inventory                                 5,072,000        5,475,000
    Investment securities                     2,764,000        2,700,000
    Deferred compensation                       627,000          525,000
    Prepaid expenses and other current
     assets                                   2,438,000        3,273,000
    Note receivable - current                   183,000                -
    Deferred tax asset                           90,000                -
      Total Current Assets                   15,742,000       14,442,000

  Property, plant and equipment - net        10,076,000        9,535,000
  Trademarks and intangibles - net            4,785,000        6,508,000
  Deferred tax asset, net of current portion    172,000                -

  Note receivable, net of current portion     1,320,000                -

  Other assets                                   61,000           60,000

      TOTAL ASSETS                          $32,156,000      $30,545,000

    Current liabilities:
    Accounts payable and accrued expenses    $2,918,000       $2,263,000
    Income taxes payable                        483,000          899,000
    Line of credit                              624,000          633,000
    Current maturities of long-term debt        542,000          561,000
    Deferred tax liability - current                  -           90,000
      Total current liabilities               4,567,000        4,446,000

    Long-term debt, net of current portion    3,851,000        3,977,000
    Deferred tax liability - non-current              -          101,000
      Total Liabilities                       8,418,000        8,524,000

  Stockholders' Equity:

  Common stock; par value $.001 per share;
   20,000,000 authorized; 13,363,624 and
   12,782,791 shares issued and
   outstanding, respectively                     13,000           13,000
  Additional paid-in capital                 25,579,000       21,759,000
  Accumulated other comprehensive income        227,000          282,000
  Retained Earnings                           2,843,000        1,149,000
                                             28,662,000       23,203,000

  Less cost of 210,902 shares of
   common stock in treasury                  (1,075,000)      (1,075,000)
  Less Unearned compensation                 (3,849,000)        (107,000)
  Total Stockholders' Equity                 23,738,000       22,021,000

  TOTAL LIABILITIES & STOCKHOLDERS' EQUITY  $32,156,000      $30,545,000

                       MEDIFAST, INC. AND SUBSIDIARIES

                                             Three months Ended March 31,
                                               2006              2005
                                            (Unaudited)      (Unaudited)

  Revenue                                   $19,183,000       $8,326,000
  Cost of sales                               4,778,000        2,073,000
  Gross Profit                               14,405,000        6,253,000
  Selling, general, and administration       11,351,000        5,341,000

  Income from operations                      3,054,000          912,000

  Other income/(expense)
    Interest expense                            (89,000)         (65,000)
    Loss on sale of Consumer Choice Systems    (323,000)               -
    Interest income                              98,000           28,000
    Other income (expense)                       79,000          (21,000)

  Income before provision for income taxes    2,819,000          854,000
  Provision for income tax (expense)         (1,125,000)        (347,000)

  Net income                                  1,694,000          507,000

  Less: Preferred stock dividend requirement          -                -

  Net income                                 $1,694,000         $507,000

  Basic earnings per share                        $0.13            $0.04
  Diluted earnings per share                      $0.13            $0.04

  Weighted average shares outstanding -
    Basic                                    12,965,518       11,916,241
    Diluted                                  13,474,411       12,729,459

SOURCE: Medifast, Inc.

CONTACT: Kellie Pizzico, Investor Relations, Medifast, Inc.,