Consoltex Announces Third Quarter Results.

MONTREAL--(BUSINESS WIRE)--Nov. 5, 1997--(ME:CTX.) (TSE:CTX.) CONSOLTEX GROUP INC. announces its results for the quarter ended September 30, 1997. Consolidated sales during the quarter decreased by 6.5 percent to $117.7 million from $125.9 million in the same quarter of 1996. Despite the lower sales, net earnings were up to $2.2 million, or $0.13 per share, in the third quarter, compared to net earnings of $0.3 million, or $0.02 per share, in the prior year. Cash flow was $7.7 million, or $0.45 per share, during the quarter as compared to $6.7 million, or $0.49 per share, in the quarter ended September 30, 1996.

The increase in earnings and cash flow reflect improved operating earnings as a result of higher gross margins, lower financing costs due to lower amortization of deferred financing costs, and a lower effective tax rate as a result of the use of tax loss carryforwards against our earnings in Mexico. Apparel Operations

Sales from Apparel Operations decreased by 11.7 percent over the same period in 1996, with the majority of this shortfall attributed to lower Fashion Sector sales.

The Fashion Sector sales decreased by 21.8 percent during the current quarter compared to the same period last year. This decrease was mainly attributed to the Fashion Division, which continues to experience difficult market conditions as a result of the growing impact of imports of both fabrics and garments into North America and a reduction in consumer demand for fashion product lines. The lower sales in the Fashion Division are partially offset by the strong sales demand for curtaining fabrics for the Home Furnishings Division.

The Performance Fabrics Sector sales decreased by 4.9 percent as a result of strong import competition for nylon based fabrics in the U.S. market. All other fabric segments in this sector were relatively stable as compared to the prior year. Polypropylene Operations

Sales in the Polypropylene Sector increased by 2.9 percent over the same quarter in 1996. This increase is attributed to continued growth in sales in our Latin American subsidiaries, particularly Mexico, which are experiencing growth in the specialty fabric product lines. We are continuing to benefit from the improvements in the Mexican economy. Nine-Month Results

Sales increased by 4.6 percent from $370.0 million in the previous year to $386.9 million as a result of growth in sales in the Polypropylene business, additional sales contributed by the Erlanger Blumgart acquisition in May 1996 and strong sales growth in the Home Furnishings business. Net earnings for the nine months ended September 30, 1997 were $8.7 million, or $0.52 per share, compared to $1.4 million, or $0.11 per share, in the same period of 1996. This increase in earnings is due to higher gross margins on higher sales volume, as well as certain non-recurring items such as the inclusion of investment tax credit refunds and the application of tax loss carryforwards against Mexican taxable earnings. The positive impact of these non-recurring items on earnings per share for the nine months in 1997 is $0.20 per share.

OUTLOOK

We are cautiously optimistic about our results for the remainder of the year. Our Polypropylene Operations should continue to experience growth in earnings as a result of relatively stable polypropylene resin costs, continued operating efficiencies and a stable peso in Mexico. It is expected that our Apparel Operations will continue to be negatively affected by changing consumer preferences, particularly in the Fashion apparel business. The Company will benefit from the continued lower amortization of deferred financing expenses compared to those reported in the prior year and application of tax loss carryforwards in Mexico.

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, marketing and distribution network throughout North America, including major centres such as Montreal, New York, Los Angeles and Mexico City. Consoltex operates 11 manufacturing plants, which together employ approximately 3,800 associates. The Company is listed on the Montreal and Toronto stock exchanges under the symbol CTX.

                      CONSOLTEX GROUP INC.

CONSOLIDATED
STATEMENT OF EARNINGS

(in thousands of Canadian dollars, except per share amounts)

                            Quarter ended    Nine months ended
                             September 30       September 30
(unaudited)                1997       1996    1997       1996
______________________________________________________________

Sales - Canada          $16,880    $19,025   $63,857  $69,442
      - Exports from
         Canada          22,230     27,208    71,995   74,670
      - United States    61,827     64,565   198,466  178,972
      - Latin America    16,768     15,055    52,575   46,942
______________________________________________________________
                        117,705    125,853   386,893  370,026

Cost of sales            91,128     99,596   300,608  291,860
Selling and
 administrative
 expenses                11,670     11,968    37,331   35,125
Depreciation and
 amortization             4,552      4,509    13,984   13,773
______________________________________________________________

Earnings from operations 10,355      9,780    34,970   29,268

Financing costs:
  Interest expense, net   5,723      6,292    16,640   19,108
  Factor expenses           560        641     1,762    1,674
  Amortization and
   write-off of deferred
   financing expenses       463      1,327     2,383    3,425
______________________________________________________________
                          6,746      8,260    20,785   24,207

Earnings before income
 taxes                    3,609      1,520    14,185    5,061

Provision for income
 taxes                    1,360      1,209     5,455    3,620
______________________________________________________________
______________________________________________________________

Net earnings             $2,249       $311    $8,730   $1,441
                         ____________________________________
                         ____________________________________

EBITDA                  $14,907    $14,289   $48,954  $43,041

Earnings per share        $0.13      $0.02     $0.52    $0.11


Average number of shares
 outstanding         17,025,217 13,625,217 16,863,312 13,625,217
________________________________________________________________


CONSOLTEX GROUP INC.

CONSOLIDATED
BALANCE SHEET
_________________________________________________________________
(in thousands of Canadian dollars)    September 30    December 31
                                         1997            1996
_________________________________________________________________
                     ASSETS            (unaudited)     (audited)

Current assets -
 Cash                                    $7,545         $2,111
 Accounts receivable and
  prepaid expenses                       65,224         57,398
 Inventories                            105,561         97,898
_________________________________________________________________
                                        178,330        157,407

Fixed assets                            148,508        145,704
Goodwill                                 51,002         51,634
Other assets                             12,847         14,480
_________________________________________________________________

Total assets                           $390,687       $369,225
_________________________________________________________________
_________________________________________________________________


  LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities -
 Bank loans and acceptances             $31,664        $27,796
 Accounts payable and accrued
  liabilities                            61,540         56,365
 Income taxes payable                     7,769          3,500
 Current portion of long-term debt        7,268          4,797
 Current portion of long-term
  liabilities                               288          1,653
_________________________________________________________________
                                        108,529         94,111

Long-term debt                          194,846        204,048
Long-term liabilities                     2,471          1,333
Deferred income taxes                    16,029         14,800

Shareholders' equity -
 Share capital                           92,965         86,845
 Retained earnings                       11,519          3,384
 Deferred translation adjustment        (35,672)       (35,296)
_________________________________________________________________
                                         68,812         54,933
_________________________________________________________________

Total liabilities and shareholders'
 equity                                $390,687       $369,225
_________________________________________________________________
_________________________________________________________________


CONSOLTEX GROUP INC.


CONSOLIDATED
STATEMENT OF CASH FLOWS

(in thousands of
 Canadian dollars)     Quarter ended      Nine months
                       September 30      ended September 30
(unaudited)           1997      1996     1997       1996
___________________________________________________________

Funds provided by operations:

 Net earnings for
  the period         $2,249     $311    $8,730     $1,441
 Depreciation         3,564    3,426    10,996     10,406
 Amortization of goodwill
  and other assets      988    1,083     2,988      3,367
 Amortization and write-off
 of deferred financing
 expense                463    1,327     2,383      3,425
 Deferred income taxes  471      504     1,408        901
___________________________________________________________
                      7,735    6,651    26,505     19,540

Changes in -

 Accounts receivable
 and prepaid expenses 9,860    3,876    (7,411)   (18,578)
 Inventories         (6,317)   1,762    (7,074)    (8,548)
 Accounts payable and
 accrued liabilities     (1)  (1,028)    4,830     22,704
 Income taxes payable 1,284      226     4,276     (2,446)
__________________________________________________________
Net funds provided
 by operations       12,561   11,487    21,126     12,672

Investments:
  Purchase of fixed assets,
  net of disposals   (3,875)  (2,277)  (12,902)    (7,291)
__________________________________________________________
Net funds provided
 before financial
 transactions         8,686    9,210     8,224      5,381


Financial transactions:
 Issuance of
 long-term debt           -        -         -     47,593
 Repayment of
 long-term debt      (2,017)  (1,543)   (8,706)   (32,323)
 Increase (decrease)
 in other long-term
 liabilities            532   (1,332)     (233)    (5,387)
 Issuance of share
 capital                  -        -     6,120          -
 Share issue costs        -        -      (959)         -
 Increase in other
 assets                  (1)    (615)   (2,880)    (5,274)
__________________________________________________________
Increase in available
 funds                7,200    5,720     1,566      9,990

Net borrowings at the
 beginning of
 the period         (31,319) (35,326) $(25,685)   (39,596)
_________________________________________________________

Net borrowings at
 the end of
 the period        $(24,119)$(29,606) $(24,119)  $(29,606)
                   ______________________________________
                   ______________________________________

Represented by:
 Cash                $7,545   $6,132    $7,545     $6,132
 Bank loans and
 acceptances        (31,664) (35,738)  (31,664)   (35,738)
_________________________________________________________

                   $(24,119)$(29,606) $(24,119)  $(29,606)
                   ______________________________________
                   ______________________________________

Cash flow per
 share (1)           $0.45     $0.49     $1.57      $1.43

(1) Cash flow per share is net earnings 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.

CONTACT: Consoltex Group Inc.

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