ALPINE LACE BRANDS REPORTS PRELIMINARY FOURTH QUARTER AND YEAR END SALES AND INCOME; To Take Special Charges Relating to Mountain Farms and Marolf Dakota Farms Units.

MAPLEWOOD, N.J.--(BUSINESS WIRE)--January 13, 1995--Alpine Lace Brands Inc. (NASDAQ:LACE) today reported preliminary unaudited results for the fourth quarter and year ended Dec. 31, 1994.

Preliminary unaudited sales for the fourth quarter totaled approximately $38,000,000 compared with sales of $34,100,000 in the 1993 fourth quarter. Income for the quarter was approximately $450,000, or $.09 per share, before special charges, compared with income in the fourth quarter of 1993 of $191,000, or $.04 per share. Unit volume of the company's Alpine Lace Branded products increased over 15% while sales of commodity products decreased slightly.

Alpine Lace intends to take special charges of approximately $3,800,000 relating to its Marolf Dakota Farms Inc. operations ("MDFC") and Mountain Farms Inc. ("MFI") - a former wholly owned subsidiary of which a 65% interest was sold in February 1994. Net loss after the effect of the special charge was approximately $3,350,000.

The special charges are in connection with the company's cheese production, conversion and packaging operations relating to its Alpine Lace fat free products and the write-down of its equity investment in MFI. As a result of these special charges, the company is expected to benefit by approximately $1,000,000 per year commencing in the first and second quarter of 1995.

In connection with the charges, the company is closing its skim milk cheese production facility at Marolf Dakota Farms, Inc., has terminated its supply and conversion agreement with Mountain Farms, Inc. and will utilize other manufacturers to perform these functions. As a result of the special charges all cheese production will be performed at outside suppliers.

Included in the charges is a write-down of the Marolf Dakota Farms, Inc. plant and equipment of $1,200,000, termination pay obligations of $50,000 and an accrual of $1,070,000 relating to the cancellation of the supply and conversion agreement with Mountain Farms Inc. which is payable in 26 monthly installments commencing January 1995. In addition, reflected in the charges is a write-down of the company's investment in Mountain Farms Inc. of $1,071,000 to reduce the carrying value to zero, based on evaluation of the recoverability of the investment, and charges of $400,000 relating to its settlement of guarantees of inventory and accounts receivable of Mountain Farms, Inc. and additional costs relating to its sale in February 1994.

Of the $3,800,000 in special charges, $2,680,000 are non cash and $1,070,000 is payment for the termination of the supply agreement which is payable over 26 months. The company's working capital borrowings under its Loan Agreement have decreased to $7,900,000 as of Dec. 31, 1994 versus $16,000,000 as of Dec. 31, 1993.

Company sales for the year ended December 31, 1994 were approximately $132,300,000 compared with $129,800,000 in 1993. The sales include an increase of 8 percent to $104,000,000, in branded product sales and a decrease of 16 percent to $28,300,000, in sales of the company's commodity subsidiary. Income for the year ended December 31, 1994, before special charges, is estimated at $1,000,000, or $.20 per share. Net loss for the year after special charges, is estimated at approximately $2,800,000, or $.56 per share, compared with a net loss of $2,858,000, or $.57 per share in the prior year. The 1993 operations include $1,061,000 in income tax benefits, and do not include results of Mountain Farms, Inc. Mountain Farms Inc. results are not included in 1994. The 1994 net loss does not include benefits of income taxes. Alpine Lace intends to apply the loss as a carry-forward to future accounting periods.

The preliminary unaudited 1994 sales, income before special charges and resultant net loss are subject to final audit of the company's financials and are subject to change pending the company audit.

Alpine Lace Brands Inc. develops and markets a full line of low salt and low cholesterol cheeses, as well as a full line of fat free cheeses, all sold under the PreMonde Alpine Lace(R) label. The company's primary product lines provide nutritionally superior cheese products while meeting consumer demands concerning taste and product quality. Through its Marolf Dakota Farms Inc. subsidiary, the company converts and packages the company's warehouse and club store cheeses as well as dairy case sliced cheeses. In addition, through MCT Dairies Inc., the company engages in the cheese and dairy products commodity trading business.

CONTACT: ALPINE LACE BRANDS, INC.

              Arthur Karmel, 201/378-8600 ext. 145
                     or
              KCSA Public Relations, New York
              Joseph A. Mansi/Adam Friedman, 212/682-6300,
              ext. 205/215