Badger Meter reports record third quarter.

MILWAUKEE--(BUSINESS WIRE)--Oct. 15, 1996--Badger Meter Inc. (AMEX:BMI) today reported record sales and earnings for both the third quarter and nine months ended September 30, 1996.

Net sales for the third quarter of 1996 were $30,542,000, an 18.1% increase from sales of $25,856,000 for the same period in 1995. Net earnings for the third quarter of 1996 were $1,430,000, a 56.3% increase from earnings of $915,000 for the comparable prior period. Primary earnings per share rose 50.0% in the third quarter of 1996 to $0.78 from $0.52 per share for the third quarter of 1995.

For the first nine months of 1996, net sales were $87,719,000, up 6.5% from sales of $82,363,000 for the same period in 1995. Net earnings were $3,707,000 for the first nine months of 1996, a 31.3% increase from earnings of $2,823,000 for the first nine months of 1995. Primary earnings per share were $2.02 for the first nine months of 1996, a 25.5% increase from earnings of $1.61 per share in the comparable prior period.

"This was another excellent quarter for Badger Meter," said James L. Forbes, president and chief executive officer of Badger Meter.

"The increase in sales reflects higher sales volumes and favorable pricing," Forbes said. He noted that sales of TRACE(R) radio frequency automated meter reading systems, flow tubes and various utility metering products increased during the quarter. Sales of industrial products to the company's European markets also improved.

Forbes said the increase in third quarter earnings was due to the higher sales and an improvement in the profit margin from 36.7% in the third quarter of 1995 to 37.1% in the third quarter of 1996. The profit margin improvement resulted from increased manufacturing efficiencies and favorable pricing, primarily in the utility market. Third quarter earnings also benefited from a decrease in interest expense, reflecting debt reductions achieved through the company's strong cash flow. Marketing and selling expenses were higher in the third quarter of 1996 than in the same period last year as the company continues to establish its new international division.

Badger Meter is a leading marketer and manufacturer of products using flow measurement and control technology serving industrial and utility markets worldwide.

Badger Meter company news is available 24 hours a day, on-line at: http://www.businesswire.com/cnn/bmi.htm. -0-

                           Badger Meter Inc.
                 Consolidated Statement of Operations(1)

                     Nine Months Ended September 30,

                                      1996                   1995(2)
                                      ----                   ----
Net sales                        $87,719,000             $82,363,000
Gross profit                     $32,047,000             $29,222,000
Earnings before income taxes      $5,876,000              $4,502,000
Provision for income taxes        $2,169,000              $1,679,000
Net earnings                      $3,707,000              $2,823,000
Earnings per common share:
  Primary                              $2.02                   $1.61
  Fully diluted                        $2.00                      (2)
Average shares outstanding:
  Primary                          1,832,494               1,753,503
  Fully diluted                    1,856,285                      (2)

                     Three Months Ended September 30,

                                      1996                   1995(2)
                                      ----                   ----
Net sales                        $30,542,000             $25,856,000
Gross profit                     $11,323,000              $9,494,000
Earnings before income taxes      $2,256,000              $1,483,000
Provision for income taxes          $826,000                $568,000
Net earnings                      $1,430,000                $915,000
Earnings per common share:
  Primary                              $0.78                   $0.52
  Fully diluted                        $0.77                      (2)
Shares used in computation:
  Primary                          1,838,630               1,754,925
  Fully diluted                    1,847,416                      (2)

(1) Unaudited

(2) In 1995, dilution was less than 3%

CONTACT: Badger Meter Inc., Milwaukee 

Richard A. Meeusen, 414/355-0400