Keystone Automotive Operations, Inc. Reports First Quarter 2008 Results

EXETER, Penn., May 12, 2008 -- Keystone Automotive Operations, Inc., a leading distributor and marketer of automotive aftermarket accessories and equipment in North America, today announced financial results for its fiscal first quarter ended March 29, 2008. Highlights include:

  -- Net sales for the first quarter were $143.9 million, a decrease of $2.4
     million, or 1.6%, compared to $146.3 million for the same period in the
     prior year.  This modest sales decrease occurred at a time when the
     macroeconomic environment remained soft and consumer spending on
     discretionary items remained conservative.  The Company believes that
     its first quarter performance versus overall industry trends suggest
     gains in market share driven by outstanding customer service and a
     broad and deep assortment of inventory.
  -- Gross profit for the first quarter was $46.4 million versus $44.9
     million for the same period in the prior year, an increase of $1.5
     million, or 3.5%.  Gross margin increased to 32.3% in the fiscal
     quarter ended March 29, 2008, an increase of approximately 160 basis
     points compared to gross margin of 30.7% for the same period in the
     prior year.
  -- Operating income for the first quarter was $4.4 million, an increase of
     $2.4 million compared to $2.0 million for the same period in the prior
     year.  The increase was attributable to the improvement in gross profit
     mentioned above as well as a decline in operating expenses, driven
     primarily by efficiencies in warehouse operations, which helped to more
     than offset higher fuel costs and inflation.
  -- The Company recorded a net loss of $2.8 million in the first quarter
     ended March 29, 2008 versus a net loss of $8.5 million for the same
     period in the prior year.  The fiscal quarter ended March 29, 2008
     benefited from higher operating income, lower interest expense and the
     absence of a $6.1 million deferred financing charge associated with the
     refinancing that occurred early in the first fiscal quarter of the
     prior year.  This was partially offset by a $3.4 million decrease in
     income tax benefit.
  -- As of March 29, 2008 the Company had a cash balance of $11.9 million.
     The net debt (total debt less cash) at the end of the first quarter was
     $360.6 million compared to $368.1 million for the same period in the
     prior year.

"In an operating environment that remained extremely challenging, we are pleased with our financial performance for quarter," said Ed Orzetti, Chief Executive Officer of Keystone. "The increases we achieved in gross margin and operating profit illustrate that we are doing the right things for the business. We are focused on eliminating inefficiencies in our operations while leveraging our core strengths -- inventory availability, timely delivery, and superior customer service."