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CARDIS REPORTS THIRD QUARTER AND NINE-MONTH RESULTS; ACCEPTANCE OF ASSET-BASED LOAN PROPOSAL

 LOS ANGELES, March 22 /PRNewswire/ -- Cardis Corp. (OTC) today reported lower sales and increased operating losses for its third fiscal quarter and nine-month period ended Jan. 31, 1993, as compared to the previous year. At the same time, the company announced the acceptance of a proposal for an asset-based loan to provide financing for ongoing operations and payment of existing debt.
 Cardis said the asset-based loan proposal, from a major financial institution, provides for working capital as well as for a proposed pay off of a major Cardis creditor. Terms of the pay off must still be negotiated with that creditor. Cardis is currently out of compliance with many of the covenants of its two principal credit agreements; however, its creditors have not made a demand for payment.
 The company added that it is proceeding with its intention to sell its warehouse distribution operations in Northern and Central California to Auto Parts Wholesale of Bakersfield, Calif. The transaction is subject to approval of both companies' banks and is anticipate to close by the end of March.
 Regarding financial results, Cardis incurred a net loss of $3.7 million, or $1.70 per share, for its third fiscal quarter, which included a $2.0 million reserve in connection with the cost of consolidating four of the company's warehouses into two other existing facilities. For the corresponding year-earlier quarter, Cardis recorded a net loss of $937,000, or $.42 per share. Sales for the current third fiscal quarter were $14.9 million compared with $17.0 million a year ago.
 For the current nine-month period, Cardis' net loss equaled $5.0 million, or $2.31 per share, on net sales of $48.9 million. In the year earlier nine-month period, Cardis reported a loss before extraordinary item of $1.8 million, or $.81 per share, on sales of $55.4 million. After reflecting the effect of the company's 1992 recapitalization program, Cardis reported nine-month fiscal 1992 net income of $19.6 million, or $8.80 per share.
 In addition to the costs incurred in consolidating company operations, Cardis attributed the current net losses to continuing declines in sales and gross profit margins. Sales declines stemmed from lower order fill rates caused by lower cash flow resulting from the requirement from the company's bank to pay down its existing loan.
 "The third quarter results do not reflect the recent progress Cardis has achieved in terms of bringing operating costs in line with anticipated sales levels, nor the potential positive ramifications of the Northern and Central California sale and new possible financing arrangements," said Kenneth C. Cleveland, president and chief executive officer. "Nevertheless, we are very cognizant of the need to maintain our aggressive philosophy as to cash and inventory management. Our aim is to demonstrate operating performance progress and regain positive cash flow."
 Cardis Corp. is one of California's largest distributors of automotive parts, supplies and accessories.
 CARDIS CORP. AND SUBSIDIARIES
 Condensed Consolidated Statement of Operations
 (Dollars in thousands except per share data)
 (Unaudited)
 Three Months Ended Nine Months Ended
 Jan. 31, Jan. 31,
 1993 1992 1993 1992
 Net Sales $14,864 $16,969 $48,879 $55,387
 Cost of Sales 10,358 11,532 33,909 37,890
 Gross Profit 4,506 5,446 14,970 17,497
 Selling, General
 and Administrative
 Expenses 5,622 5,768 16,277 17,382
 Unusual Item-
 Warehouse
 Consolidation and
 severance costs 2,000 --- 2,000 ---
 Income (loss) from
 operations (3,116) (322) (3,307) 115
 Interest Expense 573 615 1,710 1,931
 Loss before extra-
 ordinary item (3,689) (937) (5,017) (1,816)
 Extraordinary Item-
 Debt Restructuring
 and Reorganization --- --- --- 21,459
 Net Income (loss) ($3,689) ($937) ($5,017) $19,643
 Income (Loss)
 Per Common Share:
 Loss before extra-
 ordinary item --- --- ($2.31) ($.81)
 Extraordinary item --- --- --- 9.61
 Net income (loss) ($1.70) ($.42) ($2.31) $8.80
 Weighted average
 number of common
 shares used in
 computing income
 (loss) per share 2,172,441 2,231,616 2,172,340 2,232,100
 -0- 3/22/93
 /CONTACT: Kenneth C. Cleveland, president and CEO of Cardis Corp, 213-227-4855 or 714-739-5561; or Cecilia A. Wilkinson, or Craig A. Parsons of Pondel Parsons & Wilkinson, 310-207-9300, for Cardis/


CO: Cardis Corp. ST: California IN: AUT SU: ERN

EH -- LA016 -- 8119 03/22/93 10:03 EST
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Date:Mar 22, 1993
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