Actuant Reports Bond Repurchases and Further Debt Reduction.

Business Editors

MILWAUKEE--(BUSINESS WIRE)--Sept. 17, 2002

Actuant Corporation (NYSE: ATU) reported today that strong fiscal fourth quarter cash flow resulted in a reduction of its total debt to approximately $192 million as of August 31, 2002. This compares to approximately $451 million of debt on July 31, 2000, when it spun-off its electronics segment, and approximately $240 million at May 31, 2002, its most recent quarter-end.

Total debt to trailing earnings before interest taxes, depreciation and amortization ("EBITDA") has declined from approximately 4.0X trailing twelve month EBITDA at the time of the spin-off to below Actuant's 2.5X trailing twelve month EBITDA leverage target at August 31, 2002 (excluding the impact of discontinued operations, extraordinary charges and the cumulative effect of adopting new accounting pronouncements). Actuant's August 31, 2002 outstanding debt does not include the approximate $15 million of borrowings in early September to fund and complete the previously announced acquisition of Heinrich Kopp A.G.

Robert C. Arzbaecher, Actuant President and Chief Executive Officer, commented, "We had very strong cash flow in the fourth quarter, aided by excellent working capital management from both business segments. We used this operating cash flow, as well as the approximate $23 million of cash that we had been holding on our balance sheet, to reduce debt to approximately $192 million. Our debt reduction in excess of $250 million over the last twenty-five months positions Actuant with a significantly stronger balance sheet to grow for the future, both organically and through acquisitions."

In a related matter, Actuant also announced that it has completed the repurchase of approximately $17 million (face amount) of its 13% Senior Subordinated Notes on the open market for approximately $20 million, including fees and expenses. Funds for the repurchases, which took place during the late June through early September timeframe, were provided from borrowings under the Company's existing senior secured credit facility. Following the repurchases, approximately $113 million (face amount) of the 13% Senior Subordinated Notes remain outstanding.

The completed repurchase of $17 million of the 13% Senior Subordinated Notes will result in one-time charges from early extinguishment of debt, net of income taxes, of approximately $1.3 million, or $0.11 per diluted share, and $0.9 million, or $0.07 per diluted share, in the fourth quarter of fiscal 2002 and the first quarter of fiscal 2003, respectively. The charges represent the combination of premiums paid above face value for the notes, fees and expenses, and the non-cash write-off of a portion of capitalized debt issuance costs.

Andrew G. Lampereur, Actuant Chief Financial Officer, commented, "We are pleased with the success in buying back our 13% bonds since it allows Actuant to further reduce borrowing costs. We are replacing 13% paper with revolver borrowings costing approximately 5%, which should generate annual interest savings of more than one million dollars commencing in the first quarter of fiscal 2003."

The Company will be announcing fourth quarter results and providing updated guidance for fiscal 2003 on Wednesday, October 2, 2002. Specific call-in information for the Company's earnings release conference call will be forthcoming.

Safe Harbor Statement

Certain of the above comments represent forward-looking statements made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. Management cautions that these projections are based on current estimates of future performance and are highly dependent upon a variety of factors, which could cause actual results to differ from these estimates. Actuant's results are also subject to general economic conditions, variation in demand for customers, the impact on the economy of terrorist attacks, the length of the current recession in the Company's markets, continued market acceptance of the Company's new product introductions, operating margin risk due to competitive pricing and operating efficiencies, supply chain risk, material and labor cost increases, foreign currency fluctuations and interest rate risk. See the Company's registration statements filed with the Securities and Exchange Commission for further information regarding risk factors.

About Actuant

Actuant, headquartered in Milwaukee, Wisconsin, is a diversified industrial company with operations in more than 20 countries. The Actuant businesses are leading companies in highly engineered position and motion control systems and branded tools. Products are offered under such established brand names as Enerpac, Gardner Bender, Kopp, Milwaukee Cylinder, Nielsen Sessions, Power-Packer, and Power Gear.

For further information on Actuant and its business units, visit the Company's website at www.actuant.com.