Avondale Response to OSHA Findings.

AVONDALE, La.--(BUSINESS WIRE)--July 2, 1999--

Avondale Industries, Inc. (Nasdaq:AVDL) is satisfied that OSHA's longest, most comprehensive and most burdensome employee records review in the agency's thirty-year history has finally been concluded. OSHA's inspection demonstrated that Avondale's record keeping system is 99% accurate. By any grading system, other than OSHA's Team Leader Mike Hunter, that is an A+.

Overall, the OSHA records review demonstrated that, to the best of Avondale's own information, the company's annual log and summary of occupational injuries and illnesses "OSHA Form 200 1998," is currently accurate and complete.

The fines proposed by the team leader reflect a dispute concerning interpretation of Bureau of Labor Statistics ("BLS") guidelines between Avondale and team leader Mike Hunter. Avondale intends to resolve that dispute in coming weeks through discussion with OSHA's higher management or before the Occupational Safety and Health Review Commission.

Avondale believes its interpretation of BLS guidelines is correct in that compliance with record keeping guidelines should be measured by reference to the audited, computer- generated OSHA 200 form for the reporting year 1998. Instead, OSHA's conclusions are based on the unaudited and incomplete working draft of logged recordable clinic visits, which is only one of several sources of information used by Avondale in compiling its computerized data base of occupational injuries and illnesses.

Even if it were correct to measure Avondale's record keeping compliance by reference to incomplete working documents rather than the final OSHA 200 form, the errors cited by the OSHA citation represent less than 1% of the total number of visits by employees to Avondale's clinic over the four year period covered by the citation.