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KIT Announces Earnings for Second Quarter 1998

15 June 1998

KIT Announces Earnings for Second Quarter 1998

    LONG BEACH, Calif., June 15 -- KIT Manufacturing Company
(Amex: KIT) reported net income of $55,000, or $0.05 per share, for the
current fiscal quarter in comparison to a net loss of $737,000, or $0.66 per
share, for the same period in 1997.  The Company reported a sales decrease for
the second quarter ended April 30, 1998 as compared to the second quarter of
fiscal 1997.
    Net sales, companywide, declined 27 percent from the comparable quarter in
the prior fiscal year.  Manufactured housing sales reflected a 5 percent
increase, while recreational vehicles posted a 38 percent decrease in sales in
comparison to the second quarter in fiscal 1997.
    According to Dan Pocapalia, KIT's Chairman of the Board, President and
Chief Executive Officer, "The RV sales decline was a result of our dealers
adjusting their inventory levels from prior years in anticipation of the new
product lines being introduced.  The increase in manufactured housing sales
can be attributed to the increased marketing efforts of that division and an
overall increase in retail demand for the KIT Manufactured home."
    "In spite of the RV sales decline, results from operations continue to
improve.  Significant changes in the RV division have yielded considerable
improvements in labor efficiencies and material handling and indicate that the
Company is moving in a positive direction.  Management believes that the
Company should meet its challenges for the third quarter and balance of the
fiscal year."

    KIT MANUFACTURING COMANY
    Statements of Income

                              Three Months Ended           Six Months Ended
                                    April 30,                 April 30,
    (Unaudited)               1998          1997         1998          1997

    Sales             $ 16,831,000   $23,134,000 $ 30,650,000  $ 39,723,000
    Costs and expenses  16,741,000    24,383,000   30,825,000    41,518,000
    Income (loss) before
     income taxes           90,000   (1,249,000)    (175,000)   (1,795,000)
    Provision (benefit)
     for income taxes       35,000     (512,000)     (73,000)     (736,000)
    Net income (loss)      $55,000    $(737,000)   $(102,000)  $(1,059,000)
    Net income (loss)
     per share               $0.05       ($0.66)      ($0.09)       ($0.95)
    Shares outstanding   1,110,934     1,110,934    1,110,934     1,110,934