Emco Announces Record Third Quarter Earnings.

LONDON, Ontario--(BUSINESS WIRE)--Oct. 20, 1997--Emco Limited (TSE, ME:EML; NASDAQ:EMLTF) announced today record results for the quarter ended Sept. 30, 1997. Net earnings rose to $12.2 million ($0.51 per share) compared to net earnings of $11.6 million ($0.50 per share) in 1996.

Earnings in the 1996 period included a gain on the sale of businesses of $7.2 million before tax. After tax the 1996 gain was equivalent to $.16 per share. Earnings excluding the gain therefore rose from $0.34 per share in 1996 to $0.51 per share in 1997, an increase of 50 percent.

Sales increased to $359.7 million in the third quarter up 9.5 percent from 1996, or 11.7 percent when excluding businesses sold in 1996. Operating earnings increased to near $23 million, a 20 percent increase over the same period in 1996.

For the nine months, sales increased to $942.5 million, an increase of 10.1 percent from 1996, or 14.1 percent when excluding businesses sold in 1996. Operating earnings increased to near $50 million, an increase of 40 percent over the same period last year.

In July, the company completed a public issue of $75 million 6.5 percent convertible subordinated debentures. These funds have been used in part to finance the acquisition of Pro-Fit Piping Components, Inc., one of the largest master distributors of industrial carbon steel flanges and butt-weld fittings in the U.S.

"Obviously, I am delighted with the record performance this fiscal quarter," noted Douglas E. Speers, President and Chief Executive Officer, Emco Limited. "We are well positioned to take advantage of the improving economic conditions in our industry."

Emco Limited is a leading Canadian distributor and manufacturer of building materials for the home improvement and building construction markets. Emco also produces custom components, including brass and aluminum forgings. -0-

EMCO LIMITED
CONSOLIDATED STATEMENT OF EARNINGS
(UNAUDITED)

                     Three months ended     Nine months ended
                        September 30           September 30
                     1997          1996       1997       1996
                   ----------  ----------  ---------  ---------
Sales              $  359,673  $  328,473  $ 942,523  $ 856,669
                   ----------  ----------  ---------  ---------
Cost of sales         275,007     251,811    715,568    653,864
Selling and
  administrative
    expenses           58,391      53,871    166,297    156,160
Depreciation and
  amortization          3,357       3,744     10,829     11,041
                   ----------  ----------  ---------  ---------
                      336,755     309,426    892,694    821,065
                   ----------  ----------  ---------  ---------
Operating earnings     22,918      19,047     49,829     35,604

Interest and other      3,408       5,034     10,275     16,308
                   ----------  ----------  ---------  ---------
Earnings before gains
  on disposal of
  businesses           19,510      14,013     39,554     19,296

Gains on disposal
  of businesses             -       7,246          -      7,246
                   ----------  ----------  ---------  ---------
Earnings before taxes  19,510      21,259     39,554     26,542

Taxes                   7,300       9,678     15,000     12,300
                   ----------  ----------  ---------  ---------

Net earnings         $ 12,210    $ 11,581   $ 24,554   $ 14,242
                   ----------  ----------  ---------  ---------
                   ----------  ----------  ---------  ---------
Earnings per share:
Basic               $    0.51        0.50       1.04       0.61

Fully diluted            0.45        0.45       0.98       0.60

October 20, 1997 London, Ontario

EMCO LIMITED CONFERENCE CALL

Emco Limited invites you to a conference call during which business results for the third quarter of 1997 will be discussed. Due to the growing number of participants, the media will not be participating in this conference call. The media is invited to speak personally to Richard Grogan, executive vice president and chief financial officer, by phoning 519/645-3900 after the conference call. The call will be held on Monday, October 20, 1997 at 2:00 pm (Eastern Time). Please phone the conference call operator at 416/620-1808 five to ten minutes before 2:00 pm.

The conference call will be chaired by Douglas E. Speers, president and chief executive officer. Also in attendance from Emco will be Frank M. Hennessey, chairman and Richard B. Grogan. A question and answer session will be included on the agenda. We would appreciate your participation on Monday's call. However, if you are not available, a taped version of the conference call will be available until midnight Wednesday, October 22nd, by calling 416/626-4100 and dialling reservation number 628365.

For more information concerning the conference call, please contact Ruth McDowell, executive assistant at 519/645-3901. Thank you.

CONTACT: Emco Limited

Richard B. Grogan or Peter M. Cuddy, 519/645-3926