GreenMan Technologies, Inc. Reports First Quarter Results.

LYNNFIELD, Mass. -- GreenMan Technologies, Inc. (AMEX: GRN), a leading recycler of over 30 million scrap tires per year in the United States, today announced results for its first quarter ended December 31, 2004.

Bob Davis, GreenMan's President and Chief Executive Officer stated, "While not pleased with our first quarter results, several of the driving factors responsible for our underperformance have been, or are currently being addressed, in order to better position us for the seasonally stronger second half of our fiscal year. During the quarter, reduced processing capacity and equipment reliability issues at our Southeast and Western operations as well as unforeseen decreases in inbound tire volumes during the quarter which we believe were attributable to the lingering impact of severe weather conditions experienced in both regions during the late summer and early fall periods negatively impacted our performance. We are currently installing equipment which we believe will positively impact the reduced processing capacity issues in the Southeast and have begun to experience increased inbound scrap tire volumes."

Mr. Davis added, "Despite these challenges, our overall revenue as well as quality of revenue (revenue per passenger tire equivalent) increased during the quarter. In addition, several positive steps were taken during the quarter including the full re-implementation of the Georgia waste wire system (November 29, 2004) and the execution a letter of intent containing an exclusive option to acquire certain operating assets of Tires Into Recycled Energy and Supplies, Inc. (January 29, 2005), one of the leading crumb rubber manufacturers in the United States."

GreenMan will hold a conference call on Monday, February 28, 2005 at 12:00 PM (Eastern Time) to discuss the results for its first quarter. To participate, please call 1-888-695-0614 and enter passcode 4113310. If you are unable to participate, the call may be replayed for seven days by calling 888-203-1112 and entering passcode 4113310.

GreenMan was founded in 1992 and today is comprised of six operating locations that collect, process and market scrap over 30 million scrap tires in whole, shredded or granular form. We are headquartered in Lynnfield, Massachusetts and currently operate tire processing operations in California, Georgia, Iowa, Minnesota, Tennessee and Wisconsin and operate under exclusive agreements to supply whole tires used as alternative fuel to cement kilns located in Alabama, Florida, Georgia, Illinois, Missouri and Tennessee.

Three Months ended December 31, 2004 Compared to the Three Months ended December 31, 2003

Net sales for the three months ended December 31, 2004 were $8,045,000, a 3 percent increase, compared to last year's net sales of $7,799,000. Our overall quality of revenue (revenue per passenger tire equivalent) increased 10 percent during the quarter ended December 31, 2004 primarily due to a 6 percent increase in overall product revenues and a 4 percent increase in tipping fees per passenger tire equivalent, despite the fact our inbound scrap tire volume decreased 7 percent during the quarter. We processed over 7.6 million passenger tire equivalents during the three months ended December 31, 2004, compared to approximately 8.1 million passenger tire equivalents during the quarter ended December 31, 2003.

Overall end product sales increased $125,000 to $2,086,000 during the quarter ended December 31, 2004, compared to $1,961,000 for the same period last year, despite our Georgia waste wire processing equipment being off-line from April 2003 to November 2004. The increase in end product sales is attributable to implementation of our waste wire processing equipment in the Midwest during the second half of fiscal 2003 and stronger crumb rubber and tire derived fuel sales during the quarter ended December 31, 2004.

Gross profit for the quarter ended December 31, 2004 was $101,000 or 1 percent of net sales, compared to $1,139,000 or 15 percent of net sales for the quarter ended December 31, 2003. Our cost of sales increased approximately $1,284,000 or 19 percent primarily due to reduced processing capacity and equipment reliability issues at our Southeast and Western operations as well as unforeseen decreases in inbound tire volumes during the quarter which we believe was attributable to the lingering impact of severe weather conditions experienced in both regions during the late summer and early fall periods. We are currently installing equipment which we believe will positively impact the reduced processing capacity issues in the Southeast and have begun to experience increased inbound scrap tire volumes.

Selling, general and administrative expenses for the quarter ended December 31, 2004 increased $148,000 to $1,216,000 or 15 percent of net sales, compared to $1,068,000 or 14 percent of net sales for the quarter ended December 31, 2003. The increase was primarily attributable to increased outside professional expenses.

As a result of the foregoing, we had an operating loss of $1,114,000 for the quarter ended December 31, 2004 as compared to an operating profit of $71,000 for the quarter ended December 31, 2003.

Interest and financing costs for the quarter ended December 31, 2004 increased $51,000 to $406,000, compared to $355,000 for the quarter ended December 31, 2003.

In addition to the disruption of operations and lost revenues caused by the March 2003 fire in Georgia, we also incurred additional direct costs relating to damaged equipment and excess disposal costs totaling approximately $95,000 which were offset by an insurance recovery of $208,000 during the quarter ended December 31, 2003.

Based on the unforeseen magnitude of the quarterly loss, we determined the near-term realizability of the non-cash deferred tax asset of $270,000 to be questionable and therefore have provided a valuation allowance on the entire amount in the quarter and accordingly have written it off during the quarter ended December 31, 2004.

As a result of the foregoing, our net loss for the quarter ended December 31, 2004 increased $1,627,000 to $1,805,000 or $.09 per basic share, compared to a net loss of $178,000 or $.01 per basic share for quarter ended December 31, 2003.

"Safe Harbor" Statement: Under the Private Securities Litigation Reform Act 

With the exception of the historical information contained in this news release, the matters described herein contain 'forward-looking' statements that involve risk and uncertainties that may individually or collectively impact the matters herein described, including but not limited to the possibility that we may not realize the benefits expected from our new Tennessee operation, product acceptance, economic, competitive, governmental, seasonal, management, technological and/or other factors outside the control of the Company, which are detailed from time to time in the Company's SEC reports, including the annual report on Form 10-KSB for the fiscal year ended September 30, 2004. The Company disclaims any intent or obligation to update these "forward-looking" statements.

Condensed Consolidated Statements of Operations

                                              Three Months Ended
                                          December 31,   December 31,
                                               2004           2003
                                         --------------- -------------
Net sales                                    $8,045,000    $7,799,000
Cost of sales                                 7,944,000     6,660,000
                                         --------------- -------------
Gross profit                                    101,000     1,139,000
                                         --------------- -------------
Operating expenses:
  Selling, general and administrative         1,215,000     1,068,000
                                         --------------- -------------
Operating profit (loss)                      (1,114,000)       71,000
                                         --------------- -------------
Other (expenses) income, net                   (421,000)     (249,000)
Income taxes                                    270,000            --
                                         --------------- -------------
Net loss                                    $(1,805,000)    $(178,000)
                                         =============== =============

Net loss per share - basic                       $(0.09)       $(0.02)
                                         =============== =============

Weighted average shares outstanding          19,106,000    16,062,000
                                         =============== =============


Condensed Consolidated Balance Sheet Data

                                          December 31,   September 30,
                                              2004           2004
                                         --------------- -------------
                  Assets
Current assets                               $6,103,000    $6,927,000
Property, plant and equipment (net)          11,679,000    11,516,000
Goodwill (net)                                3,534,000     3,534,000
Other assets                                  1,527,000     1,644,000
                                         --------------- -------------
                                            $22,843,000   $23,621,000
                                         =============== =============

        Liabilities and Stockholders' Equity

Current liabilities                         $11,904,000   $10,449,000
Notes payable, non-current                    5,950,000     6,491,000
Capital lease obligations, non-current        2,800,000     2,875,000
Deferred gain on sale leaseback                 407,000       419,000
Stockholders' equity                          1,782,000     3,387,000
                                         --------------- -------------
                                            $22,843,000   $23,621,000
                                         =============== =============