Exhibit 99.1

Sun Hydraulics Continues Double Digit Sales and Earnings Growth in 3^rd Quarter

SARASOTA, FLA, November 7, 2006 – Sun Hydraulics Corporation (NASDAQ: SNHY) reported financial results for the third quarter of 2006 as follows:

(Dollars in millions except net income per share)

“Continued growth in the third quarter has again resulted in double-digit increases in sales and earnings,” reported Allen Carlson, Sun Hydraulics’ President and CEO. “This 14^th consecutive quarter of double digit sales growth supports our belief that we continue to increase our market share.”

“We completed two significant information technology projects in the third quarter,” Carlson said. “In the US, we migrated to a “multi-facility” system which will improve information sharing as products flow across business segments. In Germany, we installed new software that will improve order entry and communication with our customers. Our European businesses are now on the same platform.”

“There were start-up costs associated with the implementations,” Carlson said, “However, these software upgrades are a critical investment in Sun’s future. Sun will continue to invest in people, machinery and processes to help us meet the demands of our customers and continue to focus on the long term.”

Recognition

In October, Sun was recognized by Forbes for the 2^nd consecutive year as one of the nations “Top 200 Small Companies”. Sun’s ranking this year improved to #87 from #113 last year. To learn more about the methodology for selecting companies, please visit http://www.forbes.com/lists/2006/23/biz_06200best_The-200-Best-Small-Companies_land.html.

Outlook

“We expect order rates to remain strong across all major markets in the fourth quarter,” Carlson said.

2006 fourth quarter sales are estimated to be approximately $33 million, an 18% increase over the same period last year. 2006 year-end sales are estimated to be approximately $140 million, a 20% increase compared to 2005. Fourth quarter earnings per share are estimated to be between $0.31 and $0.33 per share, compared to $0.26 per share last year, approximately a 23% increase.

“We are looking forward to a great finish to a great year,” Carlson concluded.

Webcast

Sun Hydraulics Corporation will broadcast its third quarter financial results conference call live over the Internet at 2:30 P.M. E.T. tomorrow, November 8, 2006. To listen to the webcast, go to http://investor.sunhydraulics.com/medialist.cfm. A copy of this earnings release is posted on the Investor Relations page of our website under “Press Releases.”

Webcast Q&A

Questions may be submitted to the Company via email after reviewing this earnings release, by going to the Sun Hydraulics website, www.sunhydraulics.com, and clicking on Investor Relations on the top menu. Scroll down to the bottom of the page and click on contact email: investor@sunhydraulics.com, which will open an email window to type in your message. Sun management will then answer these and other questions during the Company’s webcast. If an individual wishes to ask questions directly during the webcast, the conference call may be accessed by dialing 1-877-407-8033.

Sun Hydraulics Corporation is a leading designer and manufacturer of high performance screw-in hydraulic cartridge valves and manifolds for worldwide industrial and mobile markets. For more information about Sun, please visit our website at www.sunhydraulics.com.

FORWARD-LOOKING INFORMATION

Certain oral statements made by management from time to time and certain statements contained herein that are not historical facts are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934 and, because such statements involve risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements, including those in Management’s Discussion and Analysis of Financial Condition and Results of Operations are statements regarding the intent, belief or current expectations, estimates or projections of the Company, its Directors or its Officers about the Company and the industry in which it operates, and assumptions made by management, and include among other items, (i) the Company’s strategies regarding growth, including its intention to develop new products; (ii) the Company’s financing plans; (iii) trends affecting the Company’s financial condition or results of operations; (iv) the Company’s ability to continue to control costs and to meet its liquidity and other financing needs; (v) the declaration and payment of dividends; and (vi) the Company’s ability to respond to changes in customer demand domestically and internationally, including as a result of standardization. Although the Company believes that its expectations are based on reasonable assumptions, it can give no assurance that the anticipated results will occur.

Important factors that could cause the actual results to differ materially from those in the forward-looking statements include, among other items, (i) the economic cyclicality of the capital goods industry in general and the hydraulic valve and manifold industry in particular, which directly affect customer orders, lead times and sales volume; (ii) conditions in the capital markets, including the interest rate environment and the availability of capital; (iii) changes in the competitive marketplace that could affect the Company’s revenue and/or cost bases, such as increased competition, lack of qualified engineering, marketing, management or other personnel, and increased labor and raw materials costs; (iv) changes in technology or customer requirements, such as standardization of the cavity into which screw-in cartridge valves must fit, which could render the Company’s products

or technologies noncompetitive or obsolete; (v) new product introductions, product sales mix and the geographic mix of sales nationally and internationally; and (vi) changes relating to the Company’s international sales, including changes in regulatory requirements or tariffs, trade or currency restrictions, fluctuations in exchange rates, and tax and collection issues. Further information relating to factors that could cause actual results to differ from those anticipated is included but not limited to information under the headings Item 1. “Business,” Item 1A. “Risk Factors” and Item 7. “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” in the Company’s Form 10-K for the year ended December 31, 2005 and “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” in the Company’s Form 10-Q for the quarter ended July 1, 2006. The Company disclaims any intention or obligation to update or revise forward-looking statements, whether as a result of new information, future events or otherwise.

SUN HYDRAULICS CORPORATION

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