Ag-Bag International Limited Announces 1st Quarter Results.

Business Editors

WARRENTON, Ore.--(BUSINESS WIRE)--April 26, 2002

Ag-Bag International Limited (OTCBB:AGBG) announced today that net sales for the quarter ended March 31, 2002 were $4,807,485, an increase of 15.87% as compared to net sales of $4,149,208 for the same period of the prior year.

The Company had a net loss of $251,428, or ($.02) per share, for the quarter ended March 31, 2002, as compared to a net loss of $367,409, or ($.03) per share, for the same period in 2001.

Regarding the first quarter results, Ag-Bag International Limited President and CEO, Larry Inman, stated "Sales were up for the quarter as a result of increased equipment and bag sales resulting from several positive trends that could be seen towards the latter half of 2001. These positive trends included stabilizing milk prices, continued optimism that milk prices in the U.S. will remain above the record low levels of 2000 throughout 2002 and continued easing of credit by financial institutions for the farming sector that, coupled with the interest rate reductions of 2001, allowed farmers to be more optimistic and resume capital expenditures and purchase farm equipment. Machine sales for the quarter were up 19.46% and bag sales were up 21.16% compared to 2001."

                                             1st Quarter
                                         2002           2001
                                         ----           ----

Net Sales                           $  4,807,485     $  4,149,208
Gross Profit from Operations        $  1,045,870     $    772,328
Loss from Operations                $   (411,343)    $   (553,971)
Loss before Tax                     $   (402,893)    $   (577,409)
Net Loss                            $   (251,428)    $   (367,409)

Basic Earnings Per Share            $       (.02)    $       (.03)

Ag-Bag International Limited is headquartered in Warrenton, Oregon with a second major facility located in Blair, Nebraska. The Company manufactures and sells to the international agricultural industry its farm feed management systems, for the high moisture storage of silage and grains, and its composting system, for large scale "in-vessel" composting.

The discussion in this press release contains forward-looking statements that involve risks and uncertainties and various factors that could cause actual results to differ materially from those projected. Forward-looking statements relate to future sales of the Company's products for farming and composting systems. The following factors, among others, could cause actual results to differ from those indicated in the forward-looking statements: timing of demand for bagging machines and bags; reductions in U.S. milk prices; availability of credit in the farming sector; potential purchases of the Company's bagging machines, bags and composting systems; anticipated inventory production; the availability of trade credit and working capital; and the Company's dependence on the dairy industry. Readers are urged, however, to review the factors set forth in reports the Company files from time to time with the Securities and Exchange Commission. Actual results may differ materially from the forward-looking statements.