CITATION ANNOUNCES 3Q97 EARNINGS ESTIMATES.

ST. LOUIS--(BUSINESS WIRE)--Jan. 7, 1997--CITATION Computer Systems, Inc. today announced it expects revenues and earnings for the third quarter of its 1997 fiscal year to fall short of both analysts expectations and the prior year s third quarter amounts. The company also expects to report a per-share loss for the third quarter.

On a positive note, the company expects several of its new Windows NT products, including CURES, its long-awaited community registration system; C-RIS, its new radiology system; and an enhanced C-COM, its clinical communications system, to begin shipping early in fiscal 1998.

CITATION expects revenues for the quarter, which ended December 31, 1996, to be about $4.0 million, a decrease of approximately 38 percent from the fiscal third quarter a year ago. This decline in revenues was a result of reduced systems sales in both domestic and international business in the current year, compared with record sales in both areas in the prior year. The decline in revenues was also combined with lower margins due to a disadvantageous mix of business and with higher development expenses resulting from the increased cost of developing new products and a lower capitalization rate for such costs. As a result, the company expects to report a loss for the fiscal third quarter of between $0.30 and $0.32 per share, not including a loss of $0.09 per share related to costs incurred due to a secondary stock offering that was withdrawn early in the quarter.

J. Robert Copper, CITATION s chairman and chief executive officer, stated, "The current period s reduced revenues reflect both a general slowdown in the marketplace and a start-up period for the sales programs put in place by our new executive vice president of sales."

Copper added, "I remain optimistic about CITATION s prospects for the future. It will take another quarter or so for the impact of CITATION s new products and programs to be reflected in our operating performance. However, in the long term the company continues to be very well positioned to take advantage of the emerging trends in the healthcare information systems industry."

CITATION provides comprehensive client/server information systems for clinical areas, financial/administrative areas, and a community-wide registration system. CITATION has 600 systems in more than 450 healthcare facilities throughout the United States, Canada, the United Kingdom, Ireland, Asia-Pacific and other countries. CITATION has its headquarters in St. Louis, Missouri.

The preceding estimates of third quarter revenue and earnings constitute forward looking statements. Actual results could differ from expected results due to various factors, including whether final costs exceed estimates and other factors discussed in company filings with the Securities and Exchange Commission.

CITATION -- The Best Information Systems Value in Healthcare

CONTACT: CITATION Computer Systems

Rick Neece, 314/579-7900

Ned Maniscalco, 314/982-1700