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OEA Reports Expected Q4 Earnings

8 September 1998

OEA Reports Expectations for Fourth Quarter Effects of General Motors Strike Will Lead to Loss for Period

    DENVER, Sept. 8 -- OEA, Inc. today announced that
the effects from the General Motors strike and a product issue at the
Company's Aerospace division will result in the Company reporting a net loss
for the fourth quarter ended July 31, 1998.  Final results are scheduled to be
announced during the week of September 21.
    "In the fourth quarter, OEA's financial performance was severely impacted
by the General Motors strike and, to a lesser extent, by replacement and
testing costs associated with a product issue at our Aerospace division," said
Charles B. Kafadar, President and Chief Executive Officer.  "Without these two
isolated events, OEA would have been profitable in the fourth quarter and
closed the year on a very positive note."
    Kafadar added that higher-than-expected production costs and expenses
related to previously announced staff reductions and plant consolidations were
also factors in the fourth quarter results.  "Certain issues, such as the
General Motors strike, were out of our control.  Other internal issues are
being addressed with specific actions designed to return OEA to its
traditional standards of consistent growth and profitability."
    "Overall, we are very excited about prospects for the future," he added.
"We expect OEA to benefit from growing competition in the air bag industry and
from new products we are developing that have the potential to redefine
industry standards."
    Kafadar said OEA is well positioned to meet increasing customer demand in
fiscal 1999, while continuing to reduce its cost structure in response to
price decreases that took effect August 1.  "We will continue to streamline
operations and implement cost-cutting measures throughout the year and
anticipate improved performance in the second half," he said.
    "OEA has had many years of sales and profit growth due to our leading-edge
technology and efficient manufacturing in both the automotive and aerospace
industries," Kafadar said.  "While some decline in our share price is
understandable in light of our second half earnings performance and recent
market conditions, OEA shares are now trading near book value.  Given our
prospects for continued growth, sound strategies for reducing costs, and
margin potential from new products, we believe the outlook for OEA
shareholders is very promising."
    OEA is the technology leader and a major manufacturer in the air bag
inflator and initiator industry.  The Company is also a leader in the design
and manufacture of personnel escape systems for military aircraft and
high-reliability devices for missile and aerospace applications.

    Certain of the information set forth above, including statements regarding
Company strategy, its soundness, Company growth and profitability, the air bag
markets, air bag demand, aerospace product demand, sales volume increases,
margin potential, technology leadership, and the benefits of cost reduction
programs and improved manufacturing processes, as well as other statements or
implications regarding future events, are "forward-looking statements" for
purposes of federal securities laws.  Actual results or events may differ
materially from these forward-looking statements depending on a variety of
factors.  Reference is made to the cautionary statements under the caption
"Forward-Looking Statements" in OEA's Annual Report on Form 10-K for the year
ended July 31, 1997 and the Company's report on Form 8-K filed on June 4, 1998
for a description of various factors that might cause OEA's actual results to
differ materially from those contemplated by such forward-looking statements.