JMAR Anticipates 5 Percent Drop in 2001 Sales, Increase of Up to 40 Percent For 2002.

Business Editors/High-Tech Writers

SAN DIEGO--(BUSINESS WIRE)--March 20, 2002

JMAR Technologies Inc. (Nasdaq:JMAR):

-- Downturn in Microelectronics Market Reduced Demand for Company's
Semiconductor Products, Metrology Instruments in 2001

-- Growing Public and Private Sector Interest in Proprietary X-Ray Lithography
Systems Drive 2002 Estimate

JMAR Technologies Inc. (Nasdaq:JMAR), a provider of precision micro- and nanotechnology products, announced today that it expects to report sales revenues of about $18.7 million for the year ended Dec. 31, 2001, down approximately 5 percent from those achieved in the year 2000.

The company said that the drop in revenues was caused by the negative impact of the past year's microelectronics market downturn on the company's semiconductor products at JMAR Semiconductor (JSI) as well as on the metrology business at JMAR Precision Systems (JPSI).

The company also announced that it expects sales revenues for the year ended Dec. 31, 2002 to grow to more than $26 million, or almost 40 percent over the prior year, driven by a substantial increase in sales from its X-ray lithography (XRL) product line.

Jack Martinez, JMAR's chairman and CEO commented, "For quite some time key elements within the worldwide semiconductor industry, including the U.S. government, have been keenly watching our X-ray lithography program because they believed that JMAR was capable of delivering a high-performance, yet cost-effective system for manufacturing the advanced semiconductors of the future. Over the last two years, the great progress we've made in bringing a market-viable system to reality has validated that interest, creating in the process a great deal of excitement and anticipation within the industry. We believe that, combined with the continued growth in demand we are seeing for the semiconductors that can be produced by our system, portends very well for our future sales outlook, beginning with 2002.

"At a recent investor conference we noted that current annual worldwide lithography product sales were in excess of $6.5 billion," Dr. Martinez said. "We also reported that JMAR plans to receive one, or more, orders for its NanoPulsar II XRL systems by year end and to initiate system shipments to the gallium arsenide semiconductor processing industry starting in 2003. Shipments of our higher production rate XRL systems to the silicon industry are planned to start in 2005. Total sales to both industries in excess of $200 million per year are planned by 2006."

He continued, "We are now assembling on schedule, our initial laser plasma X-ray light source at JMAR Research (JRI) in San Diego. This summer, we will integrate that source with our latest model NanoPulsar XRL Stepper System at JMAR/SAL NanoLithography (JSAL) in Vermont. That will be followed by a series of planned lithography demonstrations using the NanoPulsar before the end of the third quarter. Once that occurs we will have reached our initial goal of demonstrating a revolutionary new compact, more economical lithography system for production of higher performance semiconductors."

JMAR believes that the cost and performance advantages of XRL make it the technology of choice to meet the government's need to cost-effectively produce the ultra-high-speed gallium arsenide (GaAs) semiconductors required for many critical military applications. Such microcircuits are essential, for example, to the operation of the electronic warfare arrays found on the F-22 Raptor, the Air Force's newest front-line fighter, and to the forward-looking radar on the recently approved Joint Strike Fighter. They are also critical to the effectiveness of the Army's Longbow missile and are expected to play a key role in its evolving "digital soldier" program, as well as in a variety of classified airborne, space and battlefield systems.

The company expects that once its XRL equipment is qualified for production of semiconductor products for military applications, GaAs chip manufacturers will move to install these XRL systems into their commercial product manufacturing facilities to produce high-performance chips for a variety of consumer applications such as automotive collision-avoidance radar systems and high-speed optical fiber data transmission. JMAR also believes that its XRL technology offers significant potential for many manufacturing applications in the general nanotechnology field.

JMAR Technologies Inc., is the world's leading developer and manufacturer of semiconductor X-ray lithography sources and systems and is a leading developer of proprietary advanced laser, X-ray and EUV light sources for other high-value microelectronics products. In addition, JMAR manufactures precision measurement, positioning and light-based manufacturing systems for inspection and repair of semiconductors and continues to play an important role in adapting its precision semiconductor manufacturing technology to the fabrication of data storage, advanced biomedical and optical communications products.

The statements herein regarding JMAR's expected sales revenues for 2002 and its expectations for the successful development and introduction of its X-ray lithography systems and future sales and potential business opportunities are forward-looking statements based on current expectations that are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in the forward-looking statements. These risks include the failure of the X-ray lithography technology to perform as predicted or to be fully developed and engineered in a commercial product that is accepted by the marketplace, the failure of pending patents to be issued, competition from alternative technologies, including electron beam, deep ultra-violet and extreme ultra-violet lithography technologies, the failure of future orders to materialize as expected, delays in development, shipment or production, parts and labor shortages, cancellation or re-scheduling of orders, delay in funding of third-party contracts, including the funding of U.S. Government contracts, and the other risks detailed in the company's 2000 Form 10-K and other reports filed with the SEC.