Guardian Technologies Announces 2nd Quarter Results; Posts Operating Profit of $103,000.

Business Editors & High-Tech Writers

CAREFREE, Ariz.--(BUSINESS WIRE)--Sept. 18, 2002

Guardian Technologies International Inc. (OTCBB:GDTI), today announced results for the 2nd quarter ended June 30, 2002.

It should be noted that the discussion of results of operations for the three and six months ended June 30, 2002 reflects items of income and expense generated by the company's structural steel operations while the discussion of results of operations for the three and six months ended June 30, 2001 reflects items of income and expense generated by the company's armor operations.

The reason for this is a transition from the equity method of accounting to consolidation accounting for reporting results of operations of its structural steel business due to a change in control and a change from consolidation accounting for reporting results of armor operations to the equity method of accounting due to a reduction of its ownership in that business from 51% to 33%.

Results of Operations: Three Months Ended June 30, 2002

Net sales for the three months ended June 30, 2002 were $1,571,575 compared to $134,952 for the same period in 2001. Gross profit for the three months ended June 30, 2002 was $362,500 compared to gross profit of $51,960 for the same period last year.

Total operating expenses for the three months ended June 30, 2002 were $259,471 compared to total operating expenses in 2001 of $317,528. No selling expenses were incurred during the three months ended June 30, 2002 because the company's structural steel operation does not maintain a standing sales force.

Sales are generated through a bid process administered by the General Manager and Vice President of this business unit. Total operating expenses in 2001 were comprised of selling expenses of $52,541 and general and administrative expenses of $264,987.

The company posted a net loss for the three months ended June 30, 2002 of $8,631, or $nil per share compared to a net loss of $135,289, or $0.14 per share for the same period a year ago. The company generated income from operations for the three months ended June 30, 2002 of $103,029 compared to a loss from operations of $265,568 during the three months ended June 30, 2001.

The company incurred interest charges of $64,186 (net of interest income) primarily attributable to debt associated with structural steel operations. Contributing to the company's overall net loss was $15,195 of losses in connection with the company's equity interest in armor operations.

The company's overall net loss was partially offset by an allocation of $38,978 of losses from structural steel operations allocated to minority interest shareholders.

"The company generated income from operations during the current quarter compared to a loss during the same period a year ago because the company's structural steel operations completed several profitable projects. Last year, the operating loss was generated by poor performance of the company's armor operations.

"The potential for greater profitability in structural steel operations over that of armor operations was the dominant factor in the company's decision to shift the focus of management and available resources to build and promote that side of the business," stated J. Andrew Moorer, Guardian's president and CEO.

"While 2002 business levels are not expected to match that of 2001 because of a general slowing in the economy, the infrastructure of this business sector has been changed to a point where the operation can achieve profitability on lower sales volume.

"In addition, the policies and procedures implemented in recent months are designed to eliminate or at a minimum reduce the impact of problems incurred while performing on a job, a situation not previously managed well and an area which caused substantial losses to be incurred in prior years," continued Moorer.

Results of Operations: Six Months Ended June 30, 2002

Net sales for the six months ended June 30, 2002 were $2,567,799 compared to $244,129 for the same period in 2001. Gross profit for the six months ended June 30, 2002 was $421,912 compared to gross profit of $52,039 for the same period last year.

Total operating expenses for the six months ended June 30, 2002 were $542,363 compared to total operating expenses in 2001 of $535,930. No selling expenses were incurred during the six months ended June 30, 2002 because the company's structural steel operation does not maintain a standing sales force.

Sales are generated through a bid process administered by the general manager and vice president of this business unit. Total operating expenses in 2001 were comprised of selling expenses of $100,432 and general and administrative expenses of $435,498.

General and administrative expenses for the three months ended June 30, 2002 increased $106,865 over that of the previous year. The reason for the increase is that the company's structural steel operation generates large depreciation expense charges due to extensive capital equipment requirements.

In addition, the company incurred $43,500 of consulting expenses during the first quarter at the corporate level for which common stock of the company was issued in the previous year. These costs were classified as a prepaid asset at Dec. 31, 2001 and have been expensed in full in 2002.

The company posted a net loss for the six months ended June 30, 2002 of $265,512, or $0.20 per share compared to a net loss of $233,422, or $0.26 per share for the same period a year ago. The company sustained a loss from operations for the six months ended June 30, 2002 of $120,451 compared to a loss from operations of $483,891 during the six months ended June 30, 2001.

The company incurred interest charges of $148,454 (net of interest income) primarily attributable to debt associated with structural steel operations. Contributing to the company's overall net loss was $52,110 of losses in connection with the company's equity interest in armor operations.

The overall loss was partially offset by an allocation of $53,050 of losses from structural steel operations allocated to minority interest shareholders.

"During 2001, we completed our transition from a body armor manufacturer to that of a structural steel fabricator, an industry with greater long-term revenue and profit potential.

"While our real estate activities center around liquidation of properties to reduce debt and our armor manufacturing activities now passive in nature, our primary focus has been to complete the turnaround of the structural steel business and grow its revenues and profits in future periods," said Moorer.

"We believe that by focusing in one area and performing well in that area, the company will achieve greater shareholder return than its previously adopted strategy of diversification. That is the reason why the company decided in late 2001 to eliminate its majority control position of the armor business and to begin liquidating its real estate holdings.

"The aforementioned strategy is expected to return the company to profitability in future periods and ultimately enhance shareholder value," concluded Moorer.

About Guardian

Guardian, through its wholly-owned subsidiary Guardian Steel, is engaged in structural steel fabrication for governmental, military, commercial and industrial construction projects such as dormitories, aircraft hangers, special operations centers, high and low-rise buildings and office complexes, hotels and casinos, convention centers, sports arenas, shopping malls, hospitals and a variety of customized projects.

Guardian, through its wholly-owned subsidiary Guardian Security & Safety Products Inc. (GSSP), serves the law enforcement, security and military communities. GSSP maintains a 33% ownership interest in ForceOne LLC, which manufactures a variety of high-end ballistic protective equipment including patented personal protection devices commonly referred to as body armor.

Guardian, through its wholly-owned subsidiary Palo Verde Group Inc. (Palo Verde) is engaged in the acquisition, development and sale of commercial and residential real estate.

The statements made in this press release contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Act of 1934 that involve a number of risks and uncertainties. Actual events or results may differ from the company's expectations.

In addition to the matters described in this press release, risk factors listed from time to time in the company's SEC reports and filings, including, but not limited to, its report on Form 10-QSB for the quarter ended Sept. 30, 2000 and its report on Form 10-KSB for the year ended Dec. 31, 1999, may affect the results achieved by the company.

                                              3 MONTHS      3 MONTHS
                                                ENDED         ENDED
                       DESCRIPTION            30-Jun-02     30-Jun-01
                       -----------


NET SALES:
STEEL                                       $ 1,571,575   $         -
ARMOR                                       $         -   $   134,952
                                            -----------   -----------
                                            $ 1,571,575   $   134,952

COST OF GOODS SOLD
STEEL                                         1,209,075             -
ARMOR                                                 -        82,992
                                            -----------   -----------
                                              1,209,075        82,992

GROSS PROFIT                                    362,500        51,960

OPERATING EXPENSES
SELLING, GENERAL & ADMINISTRATIVE EXPENSES      259,471       317,528
                                            -----------   -----------

TOTAL OPERATING EXPENSES                        259,471       317,528
                                            -----------   -----------

OPERATING INCOME (LOSS)                         103,029      (265,568)

OTHER INCOME (EXPENSE)                          (57,487)      (14,044)
                                            -----------   -----------

INCOME (LOSS) BEFORE MINORITY INTEREST AND
EARNINGS FROM EQUITY INVESTMENT                  45,542      (279,612)

MINORITY INTEREST                               (38,978)            -
                                            -----------   -----------

INCOME (LOSS) BEFORE EARNINGS FROM EQUITY
INVESTMENT                                        6,564      (279,612)

EQUITY IN NET EARNINGS (LOSS) FROM INVESTMENT   (15,195)      144,323
                                            -----------   -----------

NET LOSS                                    $    (8,631)  $  (135,289)

NET LOSS PER COMMON SHARE, BASIC & DILUTIVE $         -   $     (0.14)

AVERAGE COMMON AND COMMON
EQUIVALENT SHARES OUTSTANDING                 1,335,541       961,535




                                              6 MONTHS      6 MONTHS
                                                ENDED         ENDED
                       DESCRIPTION            30-Jun-02     30-Jun-01
                       -----------


NET SALES:
STEEL                                       $ 2,567,799   $         -
ARMOR                                       $         -   $   244,129
                                            -----------   -----------
                                            $ 2,567,799   $   244,129

COST OF GOODS SOLD
STEEL                                         2,145,887             -
ARMOR                                                 -       192,090
                                            -----------   -----------
                                              2,145,887       192,090

GROSS PROFIT                                    421,912        52,039

OPERATING EXPENSES
SELLING, GENERAL & ADMINISTRATIVE EXPENSES      542,363       535,930
                                            -----------   -----------

TOTAL OPERATING EXPENSES                        542,363       535,930
                                            -----------   -----------

OPERATING INCOME (LOSS)                        (120,451)     (483,891)

OTHER INCOME (EXPENSE)                         (146,001)       11,146
                                            -----------   -----------

INCOME (LOSS) BEFORE MINORITY INTEREST AND
EARNINGS FROM EQUITY INVESTMENT                (266,452)     (472,745)

MINORITY INTEREST                                53,050        98,000
                                            -----------   -----------

INCOME (LOSS) BEFORE EARNINGS FROM EQUITY
INVESTMENT                                     (213,402)     (374,745)

EQUITY IN NET EARNINGS (LOSS) FROM INVESTMENT   (52,110)      141,323
                                            -----------   -----------

NET LOSS                                    $  (265,512)  $  (233,422)

NET LOSS PER COMMON SHARE, BASIC & DILUTIVE $     (0.20)  $     (0.26)

AVERAGE COMMON AND COMMON
EQUIVALENT SHARES OUTSTANDING                 1,318,722       914,225