Goodfellow Reports Second Quarter Results.

DELSON, QUEBEC--(BUSINESS WIRE)--March 20, 1998--(ME:GDL) Goodfellow Inc. today announced second quarter results for the period ended February 28th, 1998.

The company registered a loss of $138,000 or $0.03 per share compared to a net profit of $799,000 or $0.20 per share for the second quarter last year. Sales during the quarter were up 13.8 percent to $68.3 million from $60 million a year ago.

Earnings for the 6 months were $1,062,000 or $0.26 per share compared to $2 million or $0.51 per share for the six months last year. Sales for the six months rose 23 percent to $146.4 million from $119.1 million a year ago.

Company President, Richard Goodfellow said the "disappointing results" can be attributed to several factors, not the least of which was January's severe ice storm in Quebec, Eastern Ontario and the northeast US.

"In addition the quarter was affected by strong competitive pressures and weaker sales in Western Canada, in large part due to a slower BC economy, brought on, in part, by the Asian economic crisis. Overall winter operating costs were unusually high due to the difficult conditions encountered," stated Mr. Goodfellow. Financial costs were up during the quarter, reflecting both higher interest rates and borrowing requirements to finance inventory and receivables.

Despite the weaker performance, Mr. Goodfellow said signs are encouraging for the balance of the year. "The economic conditions in most regions in Canada and the United States remain positive. The busy spring and summer season is ahead of us and we have a strong backlog on hand. Sales are expected to continue to grow in most segments, particularly in the United States where the company is continuing to focus on expansion into this market."

Goodfellow Inc. is Eastern Canada's largest independent re-manufacturer and distributor of lumber products. Goodfellow shares are listed on the Montreal Exchange under the symbol GDL. The company is celebrating its 100th anniversary this year. -0-

                           GOODFELLOW INC.

                      CONDENSED BALANCE SHEET
                        As At February 28
                     (in thousands of dollars)
                            (Unaudited)


                                 1998         1997
                                    $            $
____________________________________________________
Current assets                 95,995       77,450
Total assets                  118,796       98,455
Current liabilities            72,626       55,660
Long-term debt                  4,250        4,583
Total liabilities              79,363       62,730
Shareholders' equity           39,433       35,725
____________________________________________________
____________________________________________________


                          GOODFELLOW INC.

                        STATEMENT OF INCOME
        (in thousands of dollars except earnings per share)
                           (Unaudited)

                           Six Months Ended Three Months Ended
                              February 28       February 28
                             1998     1997     1998     1997
                                $        $        $        $
____________________________________________________________
Sales                     146,437  119,148   68,350   59,964
____________________________________________________________

Expenses
Cost of goods sold,
 selling, administrative
 and general expenses     142,632  114,161   67,457   57,803
Depreciation and
 amortization                 859      798      430      404
Financial                   1,228      850      686      425
____________________________________________________________
                          144,719  115,809   68,573   58,632
____________________________________________________________

Income before income
 taxes                      1,718    3,339     (223)   1,332
Income taxes                  653    1,336      (85)     533
____________________________________________________________
Net income                  1,065    2,003     (138)     799
____________________________________________________________

Earnings per share           0.26     0.51    (0.03)    0.20
____________________________________________________________


                          GOODFELLOW INC.

             STATEMENT OF CHANGES IN FINANCIAL POSITION
                   Six Months Ended February 28
                     (in thousands of dollars)
                           (Unaudited)

                                         1998         1997
                                            $            $
___________________________________________________________

Operating activities
  Net income                            1,065        2,003
  Items not affecting cash
    Depreciation of amortization          859          798
    Gain on disposal of assets            (33)         (10)
___________________________________________________________
                                        1,891        2,791

Changes in non cash operating working (20,163)     (14,240)
___________________________________________________________
  capital balances                    (18,272)     (11,449)

Financing activities
  Dividends                              (531)        (506)
  Repayment of long-term debt            (167)      (2,480)
  Issuance of common shares               214          481
___________________________________________________________
                                         (484)      (2,505)

Investing activities
  Acquisition of fixed assets          (2,089)      (1,230)
  Disposal of fixed assets                229          126
  Payment of mortgage receivable            3            2
___________________________________________________________
                                       (1,857)      (1,102)
___________________________________________________________

Net cash inflow (outflow)             (20,613)     (15,056)
Cash position, beginning of period    (34,105)     (24,642)
___________________________________________________________
Cash position, end of period          (54,718)     (39,698)
___________________________________________________________

CONTACT: Goodfellow Inc.

Richard Goodfellow, 514/635-6511

514/635-3730 (FAX)

http://www.gdfellow.com

or

Maison Brison

Rick Leckner, 514/731-0000

514/731-4525 (FAX)

Internet: [e-mail]