Barnes Group Announces Third Quarter Results; Company Achieves Record Sales and Orders.

Business Editors

BRISTOL, Conn.--(BUSINESS WIRE)--Oct. 13, 2000

-Barnes Group Inc. (NYSE:B) today announced that diluted earnings per share were $0.49 for the third quarter of 2000, an increase of nine percent from $0.45 per diluted share for the third quarter of 1999. Net income for the quarter ended September 30, 2000 was $9.3 million, up five percent from $8.9 million for the same period a year ago.

Net sales for the third quarter of 2000 were a record $190.6 million, up 24 percent from net sales of $154.0 million last year. This marked the third consecutive quarter in which Barnes Group set a new sales record, reflecting both organic sales growth and the company's three recent acquisitions. Foreign sales continue to be an important contributor to Barnes Group's growth, as foreign sales were $47.0 million during the most recent quarter, compared with $37.1 million in the same year-ago period. Total company-wide orders were $199.9 million in the third quarter of 2000, setting a new record for Barnes Group.

"This quarter's results slightly exceeded our expectations," said Edmund M. Carpenter, Barnes Group Inc.'s president and chief executive officer. "Our three recent acquisitions - one each in Associated Spring, Barnes Aerospace, and Barnes Distribution - have clearly had a positive impact on our top-line growth. More importantly, the early synergies from these acquisitions are beginning to have an impact on our bottom line," Carpenter commented.

Sales at Associated Spring were $79.9 million for the third quarter of 2000, up 13 percent from $70.9 million a year ago. Sales growth during the quarter reflected strong foreign demand for the company's products, especially in Asia, South America, and Europe. In addition, the Hyson(TM) and Kaller(R) nitrogen gas spring product lines, which Barnes Group acquired in August, 1999, contributed $10.7 million in sales in the third quarter of 2000.

Operating profit at Associated Spring rose 38 percent to $11.6 million in the third quarter of 2000, from $8.4 million for the same period a year ago, largely as a result of the higher sales volume.

Sales at Barnes Aerospace were $34.7 million in the quarter ended September 30, 2000, up 22 percent from $28.5 million in the same period a year ago. Orders at Barnes Aerospace were $44 million during the third quarter of 2000, while backlog rose to $101 million at September 30, 2000, compared with $82 million at September 30, 1999. The order and backlog data exclude Kratz-Wilde Machine Company and Apex Manufacturing Inc., the assets of which were acquired by Barnes Group on September 7, 2000. Operating income increased to $3.2 million for the third quarter of this year, up 74 percent compared with $1.8 million a year ago, largely as a function of the higher sales volume.

"The investment we have made in the sales and marketing organization at Barnes Aerospace over the past 18 months is clearly reflected in this quarter's order rate," Carpenter said. Orders were especially strong for wide-body engine components, reflecting increased customer penetration among the world's largest aircraft engine manufacturers.

Third quarter 2000 sales at Barnes Distribution were $79.2 million, up 37 percent from $57.7 million in the third quarter of 1999. Curtis Industries contributed $21.0 million in sales in the 2000 third quarter. Operating profit for the third quarter fell to $2.7 million from $3.9 million a year ago, largely as a result of one-time consolidation costs related to the Curtis Industries acquisition.

"While operating earnings at Barnes Distribution fell from year-ago levels, we were still encouraged by some sequential improvement from the second quarter of this year. The integration of Curtis into Barnes Distribution is proceeding at a pace well ahead of our original schedule, with synergies from the combined entity falling into place. As a result, we expect that operating earnings at Barnes Distribution will increase sharply in 2001 compared to both 1999 and 2000 levels," Carpenter commented.

For the first nine months of 2000, Barnes Group Inc.'s net income was $27.8 million, up three percent from $27.0 million for the same period a year ago. Diluted earnings per share were $1.48 for the nine months ended September 30, 2000, an increase of nine percent from $1.36 per diluted share in the same period of 1999. Net sales for the first nine months of 2000 were $552.0 million, up 17 percent from net sales of $472.6 million last year. Included in both the current quarter and nine-month results is a one-time gain of approximately $2.2 million related to the sale of a corporate asset, which was substantially offset by the Curtis consolidation costs.

"Looking ahead to the balance of 2000, I believe that we will continue to execute on our plan of delivering significant year-over-year growth in both sales and earnings. Based on what we currently see in our businesses and markets, we would expect that trend to continue into 2001," stated William C. Denninger, Barnes Group's chief financial officer.

Barnes Group Inc. (www.barnesgroupinc.com) is a diversified international manufacturer of precision metal parts and distributor of industrial supplies, serving a wide range of markets and customers. Founded in 1857, Barnes Group consists of three businesses with 1999 sales of $622 million. Barnes Group employs approximately 5,000 people at more than 50 locations worldwide.

This release may contain certain forward-looking statements as defined in the Public Securities Litigation and Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially from those contained in the statements. Investors are encouraged to consider these risks and uncertainties as described within the company's periodic filings with the Securities and Exchange Commission, including the following: changes in market demand for the types of products and services produced and sold by Barnes Group, changes in worldwide economic and political conditions, interest and foreign exchange rate fluctuations, and regulatory changes.

                           BARNES GROUP INC.
                   CONSOLIDATED STATEMENTS OF INCOME
             (Dollars in thousands, except per share data)
                              (Unaudited)

                        Three months ended         Nine months ended
                            September 30              September 30
                         2000         1999         2000         1999

Net sales          $   190,570  $   154,043  $   552,041  $   472,574

Cost of sales          123,550      103,665      362,715      320,485
Selling and
 admin. expenses        50,058       37,043      140,471      110,820
                   -----------   ----------   ----------   ----------
                       173,608      140,708      503,186      431,305

Operating income        16,962       13,335       48,855       41,269

Other income               973        1,364        3,350        4,400
Interest expense         4,008        1,617       10,250        3,530
Other expenses           1,151          379        2,742          855

Income before
 income taxes           12,776       12,703       39,213       41,284

Income taxes             3,441        3,811       11,372       14,243

Net income         $     9,335  $     8,892  $    27,841  $    27,041

Per common share:
  Net income
   - basic         $       .50  $       .46  $     1.50   $      1.38
   - diluted               .49          .45        1.48          1.36
  Dividends                .20          .19         .59           .56

Average common shares
 outstanding
   - basic          18,601,009   19,347,665   18,551,378   19,560,942
   - diluted        18,870,208   19,583,293   18,759,413   19,796,883



                           BARNES GROUP INC.
                      CONSOLIDATED BALANCE SHEETS
                        (Dollars in thousands)
                               Unaudited

                                       September  September
                                          2000       1999
Assets
Current assets
   Cash and short-term investments     $ 44,808   $ 39,057
   Accounts receivable                  122,033    100,034
   Inventories                           94,340     64,039
   Deferred income taxes and prepaid
    expenses                             19,546     18,056
      Total current assets              280,727    221,186

Deferred income taxes                    22,713     24,499

Property, plant and equipment           165,335    147,687

Goodwill                                147,578     88,733

Other assets                             56,280     35,821
                                       --------   --------
                                       $672,633   $517,926

Liabilities and Stockholders' Equity
Current liabilities
   Notes payable                       $ 41,262   $ 22,293
   Accounts payable                      57,312     45,433
   Accrued liabilities                   64,513     46,541
      Total current liabilities         163,087    114,267

Long-term debt                          230,000    140,000

Other liabilities                        79,570     78,255

Stockholders' equity                    199,976    185,404
                                       --------   --------
                                       $672,633   $517,926