Criticare Systems, Inc. Fiscal Year 2002 Ending June 30, 2002.

Business Editors

MILWAUKEE--(BUSINESS WIRE)--Sept. 10, 2002

CRITICARE SYSTEMS, INC. (NASDAQ-NMS: CXIM). CSI revenue for fiscal 2002 was $26.2MM compared to $27.7MM in fiscal 2001. As stated in previous releases, the majority of this difference was the interruption of the September AAOMS (oral surgery) conference, which in each of prior years generated in excess of 5% of CSI's annual sales. This conference is the largest selling show the company attends and was not rescheduled during the remainder of the fiscal year. The other contributing event was the prolonged implementation of a new manufacturing, sales and service organization in Asia. This plan provides CSI with a cost and strategic market advantage in the Asian markets. The activities involved in launching the plan did negatively affect Q3 and Q4 sales in these regions.

Due to the above events the company experienced a net loss of $1.4MM in fiscal 2002 compared to a loss of $178,000 for fiscal 2001. $1.1MM of this occurred in fiscal first quarter 2002. The remainder involved the implementation of the Asian plan and unfavorable currency exchange on sales in India.

While this has been a challenging year, the company's current financial position remains strong with no debt, $6MM in cash and securities, and an unused line of credit. CSI also crossed an important strategic milestone by entering fiscal 2003 with a forecast focused on niche markets. This plan, put in place two years ago, intentionally moves the company away from traditional vital signs monitoring. CSI expects that its anesthesia products will represent over 50% of its revenue during the next 12-18 months. It is anticipated a major portion of these sales will occur through OEM partnerships. The company is currently working toward an additional niche business that closely parallels the anesthesia market.

CSI (www.csiusa.com) designs, manufactures, and markets cost-effective patient monitoring systems and noninvasive sensors for a wide range of hospitals and alternate health care environments throughout the world.

This press release contains forward-looking statements. Such statements refer to the company's beliefs and expectations. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those described. Such uncertainties include, but are not limited to, the timely completion of new products, regulatory approvals for new products, the risk of new and better technologies, risks relating to international markets, as well as general conditions and competition in the company's markets. Other risks are set forth in CSI's reports and documents filed from time to time with the Securities and Exchange Commission.