CORRECT: Fitch Ratings Affs UNOVA Inc. & Changes Outlook to Stable.

Business Editors

NEW YORK--(BUSINESS WIRE)--June 18, 2002

(In a press release issued earlier, there was information missing from the third paragraph. The updated press release follows.)

Fitch Ratings-Chicago-June 18, 2002: Fitch Ratings has affirmed the rating on UNOVA Inc.'s (NYSE:UNA) senior notes at 'CCC', and changed the Rating Outlook to Stable from Negative.

The change in the rating outlook reflects UNA's success in bringing down debt levels through one-time events and intellectual property settlements, and in reducing costs. UNA's covenants have been amended to provide more room and its free cash flows have improved. It also considers the company's uncertainty in generating cash flows through its core businesses.

March 2002 LTM free cash flow (EBITDA -- increase in operating WC -- capex -- cash interest -- cash tax) improved to $116.5 million from $33.3 million at Dec. 31, 2001 and $122.8 million LTM free cash flow at March 31, 2001. The improvement was mainly due to reduction in working capital, resulting from the completion of contracts. UNA's operating environment remains weak and no immediate recovery is expected. Capital spending in the automotive and aerospace markets continues to remain sluggish. Backlog for the IAS segment (57% of total sales at Dec. 31, 2001 and 52% at March 31, 2002) continued to fall, to $293 million during the first quarter of 2002 from $334 million at Dec. 31, 2001. Backlog for FY2000 and FY1999 were $515 million and $856 million, respectively. Management believes that the problems the ADS segment, comprised of Intermec Technologies, has experienced in the past several quarters are behind them and that the segment will start contributing to overall profitability. UNA has brought down its quarterly sales break-even-point to $145 million from previous $220 million. Intermec's first quarter operating loss shrank to $0.7 million (quarter sales was $140 million) in 2002 from a loss of $5.7 million ($170 million) in 2001, however this improvement also reflects the elimination of goodwill amortization (goodwill amortization for the first quarter 2001 was $2.3 million).

While the outlook for UNA's operations remains weak, the company has strengthened its balance sheet through a series of one-time events. Such events include a pension reversion (2001) and the sale of UNA's headquarters property (2002). Intellectual settlements with Compaq in 2001 and with Dell in 2002 have also contributed to debt reduction. Total debt fell to $280 million at March 31, 2002 from $501 million at March 31, 2001. Net debt at March 31, 2002 was $207 million, down from $465 million at March 31, 2001 and up slightly from $178 million at Dec. 31, 2001. EBITDA turned positive in 2001. EBITDA margin, EBITDA interest coverage, and debt/EBITDA were 2.4%, 1.1x and 7.6x, respectively. These compare to 7.4%, 3.8x and 2.8x in 1999 (2000 EBITDA was negative). Debt-to-cap rose to 41.4% in 2002 due primarily to reduction in equity related to the goodwill write-offs (39.5% in 2000 and 37% in 1999). While the debt reduction through the settlement and asset sale is meaningful, the weak business outlook is expected to hinder drastic improvements in UNA's credit profile in the short to medium term.

The company recently amended its bank covenants for 2002. Should the average availability on the U.S. revolving facility become less than $50 million and outstanding borrowing on the revolving facility exceed $10 million, the Free Cash Flow test will be applied. Current availability as defined under the agreement is about $100 million. For 2003 and beyond, Fixed Charge Test will be applied. Any further decline in operations or longer-than-expected market weakness could result in covenant violations, which could result in a further review of the rating.