Consoltex Announces 1996 Year-End Results.

MONTREAL--(BUSINESS WIRE)--Feb. 26, 1997--CONSOLTEX (TSE;ME CTX) CONSOLTEX GROUP INC. announces its results for the year ended December 31, 1996.

Consolidated sales were $494 million compared to $447 million for the year ended December 31, 1995. The increase in sales is attributed to continued growth in export sales from Canada to the United States, the stronger operating performance by Rafytek, our Mexican subsidiary, and an increase in sales of acetate fabrics at Balson-Hercules, our New York-based converting business.

The Company reported a loss of $0.8 million or $0.06 per share during the year compared to earnings of $7.0 million or $0.51 per share in 1995. The loss in 1996 includes a $0.9 million charge related to the attempted privatization of the Company whereas the 1995 earnings include an $11.8 million exchange gain on prepayment of peso denominated debt. Excluding these and other unusual items included in Other income (expense), the Company would have reported net earnings of $0.2 million in 1996 compared to a loss of $3.8 million in 1995.

Apparel Operations

Sales in the Apparel Operations increased by 12.0 percent in 1996 compared to the prior year.

The Fashion Sector sales increased by 7.5 percent from $117.5 million in 1995 to $126.3 million in 1996. This sector continues to expand its sales of Apparel and Home Furnishings specialty fabrics into the United States while improving operating profitability. In February of 1997, it is expected that the Fashion Sector will dispose of a small non-strategic division, Maison Condelle. During 1996, this division incurred operating losses amounting to $2.3 million, including a $1.2 million write- down to the value of its inventory which has been included as a charge in Cost of Goods Sold during the last quarter of 1996.

Sales in the Performance Fabrics Sector increased by 15.1 percent from $174.0 million in 1995 to $200.3 million in 1996. This increase in sales is largely attributed to an increase in demand for acetate fabrics in the U.S. market as well as additional sales contributed by the acquisition of the assets and hiring of certain employees of Erlanger Blumgart on May 1, 1996.

Polypropylene Operations

Sales in the Polypropylene Sector increased by 8.0 percent from $155.4 million in 1995 to $167.8 million in 1996. This increase is largely attributed to higher sales at Rafytek which have showed significant improvement over 1995 despite the continued difficult economic conditions in Mexico.

Our U.S. polypropylene business had a disappointing year as its results were adversely affected by manufacturing inefficiencies which were subsequently resolved and fluctuations in polypropylene resin costs, its primary raw material. These fluctuations placed pressure on its margins throughout the year.

RESULTS FOR THE FOURTH QUARTER

Despite a 30.7 percent improvement in sales in the quarter ended December 31, 1996 compared to the prior year, the Company reported a loss of $2.2 million or $0.16 per share compared to a loss of $1.9 million or $0.14 per share in 1995. The fourth quarter 1996 loss includes $0.9 million included in Other income (expense) as well as the $1.2 million write-down of the inventory of Maison Condelle.

OUTLOOK

We expect our export sales from Canada and Mexico to the United States to continue to grow. We expect an improvement in our margins due to the continuing reduction in cross border tariffs, the move towards more specialty fabrics and further synergies among the various manufacturing plants.

CONSOLTEX GROUP INC. is a North American textile company, with activities divided between its Polypropylene and Apparel Operations. Consoltex is vertically integrated from the production of yarn, in the Polypropylene Operations, through to weaving, dyeing, printing, finishing and coating.

The Company also conducts its own research and development and maintains its own sales and marketing network throughout North America, including major centres such as Montreal, New York, Los Angeles and Mexico City. Consoltex operates 11 manufacturing plants, five in Canada, one in South Carolina, four in Mexico and one in Costa Rica, which together employ approximately 3,550 people. The Company is listed on the Montreal and Toronto stock exchanges under the symbol CTX. -0-

                       CONSOLTEX GROUP INC.

CONSOLIDATED
STATEMENT OF EARNINGS
(in thousands of Canadian dollars, except per share amounts)

                                           Quarter
                                            ended
                                         December 31
                                         (unaudited)
                                        1996       1995
                                    ___________________

SALES

  Canada                             $22,723    $21,557
  Exports
     from Canada                      25,370     19,910
  United States                       61,772     44,546
  Latin America                       14,461      9,127
                                     __________________
                                     124,326     95,140

Cost of sales                         99,119     75,329
Selling and
administrative
 expenses                             13,016      9,015
Depreciation and
amortization                           4,682      5,616
                                     __________________

Earnings from
 operations                            7,509      5,180
Other income
 (expense), net                         (910)        --
                                     __________________
                                       6,599      5,180


Financing costs:
     Interest expense                  6,417      6,202
     Factor expense                      684        778
     Amortization and write-off of
      deferred financing expenses      1,405        380
                                    ___________________
                                       8,506      7,360

Earnings (loss) before income
 taxes                                (1,907)    (2,180)
Provision for (recovery of)
 income taxes                            286       (325)
                                    ___________________

Net earnings (loss) for the period   $(2,193)   $(1,855)
                                    ___________________
                                    ___________________

EBITDA                               $12,191    $10,796

Earnings (loss) per share             $(0.16)    $(0.14)

Cash flow per share(1)                 $0.23      $0.37

Average number of shares
 outstanding                      13,625,217 13,625,217


                                          Year ended
                                          December 31
                                           (audited)
                                        1996       1995
                                      ___________________

SALES

  Canada                             $92,165    $96,484
  Exports
     from Canada                     100,040     89,219
  United States                      240,744    210,251
  Latin America                       61,403     50,928
                                     __________________
                                     494,352    446,882

Cost of sales                        390,979    350,614
Selling and
administrative
 expenses                             48,141     45,914
Depreciation and
amortization                          18,455     18,563
                                     __________________

Earnings from
 operations                           36,777     31,791
Other income
 (expense), net                         (910)    10,733
                                     __________________
                                      35,867     42,524


Financing costs:
     Interest expense                 25,525     25,564
     Factor expense                    2,358      2,546
     Amortization and write-off of
      deferred financing expenses      4,830      1,378
                                    ___________________
                                      32,713     29,488

Earnings (loss) before income
 taxes                                 3,154     13,036
Provision for (recovery of)
 income taxes                          3,906      6,066
                                    ___________________

Net earnings (loss) for the period     $(752)    $6,970
                                    ___________________
                                    ___________________

EBITDA                               $55,232    $50,354

Earnings (loss) per share             $(0.06)    $(0.51)

Cash flow per share(1)                 $1.66      $1.39

Average number of shares
 outstanding                      13,625,217 13,625,217

(1) Cash flow per share is net earnings (loss) plus depreciation,
amortization, deferred income taxes and non-cash, non-recurring
items, the sum of which is divided by the average number of shares
outstanding.

                         CONSOLTEX GROUP INC.


CONSOLIDATED
BALANCE SHEET

(in thousands of Canadian dollars)

                            December 31  December 31
                               1996        1995
                            ________________________

   ASSETS                   (audited)    (audited)

Current assets -
  Cash                        $2,111          $576
  Accounts receivable
   and prepaid expenses       57,398        50,513
  Inventories                 97,898        95,754
                            ______________________
                             157,407       146,843


Fixed assets                 145,704       149,208
Goodwill                      51,634        53,022
Other assets                  14,480        15,436
                            ______________________
Total assets                $369,225      $364,509
                            ______________________
                            ______________________

   LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities -
  Bank loans and acceptances $27,796       $40,172
  Accounts payable and
   accrued liabilities        56,365        44,519
  Income taxes payable         3,500         5,367
  Current portion of
   long-term debt              4,797         7,888
  Current portion of other
   long-term liabilities       1,653         7,313
                            ______________________
                              94,111       105,259

Long-term debt               204,048       186,401
Other long-term liabilities    1,333         2,231
Deferred income taxes         14,800        14,782

Shareholders' equity -
  Share capital               86,845        86,845
  Retained earnings            3,384         4,136
  Deferred translation
   adjustment                (35,296)      (35,145)
                            ______________________
                              54,933        55,836
                            ______________________
Total liabilities and
 shareholders' equity       $369,225      $364,509
                           _______________________
                           _______________________

                     CONSOLTEX GROUP INC.

CONSOLIDATED
STATEMENT OF CASH FLOWS

(in thousands of Canadian dollars)  Quarter ended December 31
                                           (audited)

                                             1996       1995
                                    __________________________

Funds provided by
 (used for) operations:
 Net earnings (loss) for the period       $(2,193)   $(1,855)
 Depreciation                               3,550      3,731
 Amortization of goodwill
  and other assets                          1,132      1,885
 Amortization and write-off of
  deferred expenses                         1,405        380
 Deferred income taxes                       (802)       911
 Foreign exchange gain realized on
  repayment of debt                            --         --
 Loss on sale of fixed assets                  --         --
                                    __________________________

                                            3,092      5,052

 Changes in -
  Accounts receivable and
   prepaid expenses                        12,171      8,593
  Inventories                               6,772      6,978
  Accounts payable and
   accrued liabilities                    (11,260)   (17,507)
  Income taxes payable                        583       (439)
                                    __________________________
Net funds provided by operations           11,358      2,677


Investments:
  Purchase of fixed assets,
   net of disposals                        (3,120)    (3,336)
  Proceeds on sale of assets                   --         --
                                    __________________________
Net funds provided before
 financial transactions                     8,238       (659)


Financial transactions:
  Issuance of long-term debt                   --         --
  Payment of long-term debt                (1,778)    (1,905)
  Increase in other assets                 (1,367)      (725)
  Decrease in other long-term liabilities  (1,172)    (1,717)
                                    __________________________
Increase in (use of) available funds        3,921      5,006

Net borrowings at the
 beginning of the period                  (29,606)   (34,590)
                                    __________________________
Net borrowings at the
 end of the period                       $(25,685)  $(39,596)
                                    __________________________
                                    __________________________

Represented by:
  Cash                                     $2,111   $    576
  Bank loans and acceptances              (27,796)   (40,172)
                                    __________________________

                                         $(25,685)  $(39,596)
                                    __________________________
                                    __________________________


(in thousands of Canadian dollars)    Year ended December 31
                                            (audited)
                                             1996       1995
                                    __________________________

Funds provided by
 (used for) operations:
 Net earnings (loss) for the period       $  (752)   $ 6,970
 Depreciation                              13,956     13,295
 Amortization of goodwill
  and other assets                          4,499      5,268
 Amortization and write-off of
  deferred expenses                         4,830      1,378
 Deferred income taxes                         99      2,717
 Foreign exchange gain realized on
  repayment of debt                            --    (11,828)
 Loss on sale of fixed assets                  --      1,095
                                    __________________________

                                           22,632     18,895

 Changes in -
  Accounts receivable and
   prepaid expenses                        (6,407)     3,293
  Inventories                              (1,776)    (4,182)
  Accounts payable and
   accrued liabilities                     11,444     (6,817)
  Income taxes payable                     (1,863)     1,362
                                    __________________________
Net funds provided by operations           24,030     12,551


Investments:
  Purchase of fixed assets,
   net of disposals                       (10,411)   (13,457)
  Proceeds on sale of assets                   --      2,106
                                    __________________________
Net funds provided before
 financial transactions                    13,619      1,200


Financial transactions:
  Issuance of long-term debt               47,593     20,900
  Payment of long-term debt               (34,101)   (22,769)
  Increase in other assets                 (6,641)    (3,031)
  Decrease in other long-term liabilities  (6,559)    (7,975)
                                    __________________________
Increase in (use of) available funds       13,911    (11,675)

Net borrowings at the
 beginning of the period                  (39,596)   (27,921)
                                    __________________________
Net borrowings at the
 end of the period                       $(25,685)  $(39,596)
                                    __________________________
                                    __________________________

Represented by:
  Cash                                     $2,111   $    576
  Bank loans and acceptances              (27,796)   (40,172)
                                    __________________________

                                         $(25,685)  $(39,596)
                                    __________________________
                                    __________________________

-0-

CONTACT: Consoltex Group Inc.

Mr. Paul J. Bamatter, 514/ 335-7021