CITATION CORPORATION REPORTS RECORD SALES AND EARNINGS FOR THIRD FISCAL QUARTER AND NINE MONTHS.

BIRMINGHAM, Ala.--(BUSINESS WIRE)--July 24, 1996--Citation Corporation (Nasdaq: CAST) today announced record sales and earnings for its fiscal third quarter and nine months ended June 30, 1996.

Sales for the third 1996 fiscal quarter were $143.4 million, a 75 per cent increase over the fiscal 1995 third quarter of $82.1 million. Net income for the 1996 quarter was $6.9 million, versus $4.6 million for the third quarter of fiscal 1995, an increase of 49 per cent.

Earnings per share for the fiscal 1996 third quarter was $0.39 compared to $0.35 in the fiscal 1995 third quarter, a 12 per cent increase. As a result of a secondary offering in the last quarter of fiscal 1995, earnings per share for the 1996 period were calculated on a basis of approximately 17.7 million shares outstanding during the quarter versus approximately 13.3 million in the comparable 1995 period, an increase of more than four million shares.

For the fiscal 1996 nine months, sales were $356.1 million, a 65 per cent increase over the $215.6 million sales in the first nine months of fiscal 1995. Net income for the 1996 nine months was $15.3 million versus net income of $12.3 million for the fiscal 1995 nine months, a 25 per cent increase.

Earnings per share for the first nine months of fiscal 1996 was $0.87, versus $0.93 in the fiscal 1995 comparable period, a six per cent decrease. Earnings per share for the nine months was also calculated on a 17.7 million share basis, a four million share increase over the 1995 fiscal nine month's shares outstanding.

During its fiscal third quarter, Citation Corporation acquired Bohn Aluminum Corporation in Butler, Indiana. The company also acquired Texas Steel Company in Ft. Worth, Texas; Hi Tech Corporation in Albion, Indiana; and Southern Aluminum Castings Corporation in Bay Minette, Alabama in its second fiscal quarter.

Shipments during the first nine months of fiscal 1996 were approximately 167,000 tons versus approximately 142,000 tons in the comparable period of fiscal 1995. Shipments for the third quarter of fiscal 1996 were 58,700 tons as compared to 52,100 tons in 1995's third quarter. Nine months sales, excluding the companies acquired, were down less than four per cent from the comparable period last year and for the 1996 fiscal quarter were virtually flat compared with last year's fiscal quarter.

T. Morris Hackney, Chairman and CEO, said, "good performance in the fiscal third quarter reflects several factors including the better than expected performance of the divisions acquired in fiscal 1996 and the continued improvement of the fiscal 1995 acquisitions excluding Mansfield Foundry. Both our Medium Foundry and Special Foundry Groups and our Alabama Ductile Casting Company in Brewton, Alabama performed well in this past quarter."

"On the negative side, Mansfield Foundry in Mansfield, Ohio had a brief strike during the quarter which reduced earnings and the announced phase down of the Steel Division at Texas Foundries in Lufkin, Texas also reduced earnings, though not substantially. Further, while the Iron Division at Texas Foundries performed better than earlier this year, it did not meet our expectations."

"In general, our business levels and backlogs for the fourth fiscal quarter appear to be in line with the third quarter. However, during the fourth fiscal quarter, a number of our plants will take normal maintenance shutdowns of one or two weeks. While we plan and accrue for these shutdowns, it is normal that results for the fourth fiscal quarter are not as strong as the third quarter because of the shutdowns."

Citation's proposed acquisition of Interstate Forging Industries, Inc. is pending. The company has filed a registration statement with the S.E.C. with respect to certain earnout provisions of the acquisition agreement.

Citation Corporation, headquartered in Birmingham, Alabama is a major components supplier to leading manufacturers of durable goods. The company currently operates 18 manufacturing facilities in nine states and employs more than 5,000 employees. During its fiscal year 1995, its annual sales were approximately $308 million. -0-

                       CITATION CORPORATION
                   Preliminary Financial Highlights
    (All figures except Earnings per Share and shares outstanding
                         are in Thousands)

                                    Three Months Ended
                                  June 30        July 2
                                    1996          1995
Sales                            $143,420       $82,130
Gross Profit                       26,253        17,402
S,G&A Expenses                     12,326         8,828
Operating Income                   13,927         8,574
Interest Expense                    2,559         1,087
Other Expense (Income)               (141)          (55)
Income Before Tax                  11,509         7,542
Income Taxes                        4,604         2,902
Net Income                          6,905         4,640
Earnings per Share                   0.39          0.35
Number Shares Outstanding      17,699,331    13,297,826

                                    Nine Months Ended
                                   June 30       July 2
                                    1996          1995
Sales                            $356,136      $215,585
Gross Profit                       64,458        45,505
S,G&A Expenses                     34,059        23,334
Operating Income                   30,399        22,171
Interest Expense                    5,210         2,170
Other Expense (Income)               (358)         (266)
Income Before Tax                  25,547        20,267
Income Taxes                       10,219         7,991
Net Income                         15,328        12,276
Earnings per Share                   0.87          0.93
Number Shares Outstanding      17,686,639    13,260,942

CONTACT: Citation Corporation, Birmingham

Stanley B. Atkins, 205/871-5731