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CAM Designs Inc. Announces Q4 and Year End Results

16 September 1998

CAM Designs Inc. Announces Fourth Quarter and Year End Results

    Business Editors

    NEW YORK and COVENTRY, UK--Sept. 15, 1998--CAM
Designs Inc. is disappointed to announce that for
the year ended May 31, 1998, total revenues at $25.1 million down
three (3%) percent from the prior year of $25.9 million.
    This was derived generally from poor economic and commercial
conditions prevailing, particularly in the United Kingdom and
especially, in the Far East. However, during the period, gross margins
improved dramatically running at ten (10%) percent of sales compared
with the prior year of a gross loss after project write-offs. The
gross margin realized was adversely affected by the highly competitive
environment and a shift in the mix of work. The Company is seeking a
greater percentage of its business from cost plus contracts rather
than fixed price contracts to avoid the issues of cost overruns.
Moreover, in an effort to restore profitability for the future, the
Company has:

    -   terminated operations at the Warwick Plant
    -   derived annualized savings of $2 million per annum, including
        Warwick

    The loss before income taxes for the year was $3.7 million
compared with the prior year loss of $4.6 million, resulting in a loss
per share of $1.63 compared to last year's loss of $1.47 per share.
    In the year ended May 31, 1998, the results were adversely
affected by a number of actors but most importantly, $1 million has
been expended on closure and termination costs which will reduce the
fixed cost base by $0.75 million per month.

    Other factors which influenced the results were:

    -   a major customer deciding to hold in abeyance a number of its
        planned automotive projects
    -   a delay in start of EFA Nimrod aerospace programs
    -   Far East economic conditions which reduced and delayed the
        placement of development programs

    Overall, the company is better structured and leaner for 1998/99
and is currently involved in discussions for additional financing.
Management believes that the Company will be poised to aggressively
compete in its market with improved results.

    CAM Designs Inc., primarily based in the U.K., is a premier design
and engineering house for the automotive and aerospace industries in
Western Europe, the United States and the Pacific Rim.

    Statements in this news release looking forward in time are made
pursuant to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Investors are cautioned that
forward-looking statements involve risks and uncertainties, including
general economic conditions, delays and risks associated with the
negotiation, implementation and/or performance of contracts, consumer
and industry acceptance, and regulatory actions and risks.