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Rexhall Industries Posts Significant Increase in Second Quarter Results

6 August 1999

Rexhall Industries Posts Significant Increase in Second Quarter Results; Benefits From Rapid Pace in RV Market

    LANCASTER, Calif., Aug. 5 -- Rexhall Industries, Inc.
continued to drive at a rapid pace, posting a significant
increase in profitability in the second quarter, ended on June 30, 1999.
    The Lancaster, Calif.-based manufacturer of Class A motorhomes said net
earnings grew 30.5% to $1,248,000, or $0.41 per diluted share, in the 1999
second quarter, compared with net earnings of $956,000, or $0.32 per diluted
share, in the same period in 1998.  Rexhall Industries said the improvement
reflects growing consumer acceptance of the Company's product line as well as
increased sales of its slideout motorhome design.  Rexhall Industries' sales
increased to $20,937,000 in the current quarter, compared with sales of
$18,629,000 in the year-ago second quarter.
    For the six months ended June 30, 1999, Rexhall reported a 67.2% increase
in net earnings, versus the year-ago period.  Net earning rose to $2,507,000,
or $0.83 per diluted share, compared with $1,499,000, or $0.51 per diluted
share, in the first six months of 1998.  Rexhall recorded sales of $43,170,000
in the first six months of 1999, versus $32,954,000 in the same period in
1998, a 31% increase.
    "Our second-quarter results reflect the RV industry's strength right now
as well as our own operating improvements," Rexhall Chairman, President and
CEO William J. Rex said.  "Rexhall is capitalizing on these strengths by
implementing efficiencies in production as well as focusing on cost
management.  We look to further strengthen our position in the market by
building an already strong consumer confidence in our products."
    Selling, general and administrative expenses for the Company were down as
percentage of sales, to 7.5% in the second quarter 1999, from 8.5% in the
prior year quarter.  In addition, gross profit improved to 17.5% for the
second quarter of 1999, compared to 17.0%, for the same period in 1998.
    "Our dual focus on top-line growth and efficiency improvement is paying
off and we expect to remain on course for a record year in 1999," concluded
Rex.
    Rexhall Industries, Inc. (http://www.rexhall.com ) designs, manufactures and
sells various models of Class A motorhomes used for leisure travel and outdoor
activities.  Rexhall's six lines of Class A motorhomes, sold through
approximately 100 dealer locations across the U.S., Canada and Europe, include
Aerbus, RexAir, Vision, American Clipper, Anthem and RoseAir.
    Our expectations are forward-looking statements, based on assumptions and
facts known to us today, and we do not intend to update statements in this
report.  While we have enjoyed good results, our business is both seasonal and
cyclical.  We are subject to increases in materials costs, and pricing and
other pressures from substantially larger competitors, labor disruptions, and
adverse weather.  The reduced production of oil by OPEC members may reduce
sales of motor homes.  Management intends to remain aware of these factors and
react to them, but cannot predict their timing or significance.