Children's Broadcasting Corp. Reports First Quarter 1996 Results; Standardized Local Sales Program Proving Successful -- $22 Million Public Offering Completed, ABC Radio Networks Ready to Roll with AAHS.

MINNEAPOLIS--(BUSINESS WIRE)--May 3, 1996--Children's Broadcasting Corp. (CBC, Nasdaq National Market: AAHS) today announced financial results for its first quarter ended March 31, 1996.

The Company reported broadcast cash flow of ($634,025) on revenues of $1,216,023 for the first quarter ending March 31, 1996, compared to a broadcast cash flow of ($704,805) on revenues of $1,261,830 for the first quarter ended March 31, 1995.

After accounting for corporate charges, depreciation and amortization, and interest expense, the Company reported a net loss for the quarter of $1,875,873 or $(0.63) per share, compared to a net loss of $1,438,378, or $(0.53) per share, for the quarter ended March 31, 1995.

Commenting on the results, Christopher T. Dahl, president and chief executive officer of Children's Broadcasting Corp., stated, "First quarter, typically a slower radio sales quarter, was punctuated by notable success with our "AAHS Direct," standardized local sales program, overall reduction in expenses at our owned and operated radio stations, and most significantly, the February completion of a $22 million stock offering and national advertising commitments (including a partnership signed with Southland Corporation's 7-11) equal to all of 1995's national sales."

"While the net loss for the quarter was greater than first quarter last year, much of the loss was due to increased amortization and depreciation expense, and interest expense. The offering has allowed us to significantly reduce debt and future interest expense related to that debt," Dahl said.

"Our AAHS Direct program is being closely tracked at four owned and operated radio stations in Minneapolis, Los Angeles, Denver and Kansas City. As a result of AAHS Direct, cash revenues at those four stations increased from $171,000 in first quarter 1995 to $270,000 in first quarter 1996. What we are seeing is not only continuity in the way our Radio AAHS product is sold, but an efficiency and cost savings in implementing this standardized program. We are giving stations tools for successful sales," Dahl added.

Dahl also noted that overall trade (or barter) decreased measurably and that concerted efforts are being made to increase the value of Radio AAHS air time.

"First quarter was a time of transitioning many advertising and affiliate sales duties to ABC Radio Networks. With that transition nicely in place, we can look forward to working with them to produce national advertising sales and affiliation results. We are excited about the expertise and experience ABC Radio Networks brings to the table on these fronts. We are on target in implementing the next phases of expanding the network to Chicago and beyond to our goal of the top 100 markets," Dahl said.

Children's Broadcasting Corporation's Radio AAHS is an award-winning programming mix of music, news, stories and games, produced and distributed for children age 12 and under and their parents. The Company's Radio AAHS format, which broadcasts via satellite from its flagship station WWTC-AM in Minneapolis is available to approximately 35 percent of the country. Radio AAHS has an affiliated network of 30 stations across the country, including company owned or operated stations in Los Angeles, Dallas, Minneapolis, Kansas City, Denver, and New York. It is the only live, 24-hour radio network in the United States providing programming -- including live shows from Disneyland, Walt Disney World and soon, Long Island, New York -- for children and their families. -0-

           Children's Broadcasting Corporation
             Condensed Statement of Operations
                       (Unaudited)

                                    Three Months Ended
                                           March
                                       1996        1995

Revenues
 Owned, Operated and LMA stations   $  858,480    $ 889,804
 Network                               357,543      372,026
                                    ----------    ---------
   Revenues                        $ 1,216,023   $1,261,830

Operating Expenses:
 Owned, Operated and LMA stations
  General and Administrative            469,438      561,459
  Technical and Programming             199,802      294,557
  Selling                               340,527      494,867
                                      ---------    ---------
                                      1,009,767    1,350,883

Network
  General and Administrative            225,984      130,350
  Programming                           218,130      131,950
  Selling                               212,791      327,901
  Marketing                             120,231        6,560
  Magazine                               63,145       18,991
                                        -------      -------
                                        840,281      615,752

   Broadcast Cash Flow                 (634,025)    (704,805)

Corporate                               442,177      364,399
Depreciation and Amortization           531,765      231,800
Loss on Exchange of Assets                             4,461
                                       --------     --------

   Total Operating Expenses           2,823,990    2,567,295

   Loss from Operations              (1,607,967)  (1,305,465)

Interest Expense
 (Net of Interest Income)               267,906      132,913

   Net Loss                         ($1,875,873) ($1,438,378)

Net Loss Per Share                       ($0.63)      ($0.53)

Weighted Average Number
 of Shares Outstanding                3,062,500    2,707,500

CONTACT: Children's Broadcasting Corp.

Joy Plaschko, 612/330-9524

or

Lippert/Heilshorn & Assoc.

Jeffrey Volk, 212/838-3777 Ext. 102