Rheometric Scientific Reports Second Quarter Results.

PISCATAWAY, N.J.--(BUSINESS WIRE)--August 12, 1996--Rheometric Scientific, Inc. (NASDAQ:RHEM) today reported revenues of $10,826,000 for the second quarter of 1996, a considerable improvement over the first quarter of the year when revenues of $7,996,000 were recorded.

On a year-to-date basis, $18,822,000 in revenues were achieved which is down by $1,654,000, or 8%, when compared to the prior year. During the first half of the year, the company's revenues were impacted by $1,373,000 due to wide swings in Foreign currency exchange rates, particularly in Japan where the company has a strong position with rheology products. In addition, a shortage of subcontractor supplied parts and components had a negative effect on shipments particularly in the second quarter.

Net income of $747,000, or $0.06 per share, was achieved during the second quarter and compares quite favorably to the net loss of $3,548,000, or $0.27 per share, recorded in the first three months even after taking into effect the loss of $2,368,000 related to the sale/leaseback of the New Jersey headquarters facility. Excluding the one-time charge, the net loss for the first half of the year was $433,000, or $0.03 per share.

On a year-to-date basis, a net loss of $2,801,000 was recorded and is unfavorable to the net profit of $788,000 recorded during the same period of last year. Again, the reported loss for the first six months of 1996 includes the one-time charge associated with the sale/leaseback arrangement.

"We are encouraged that our profitability objectives and enhancement strategies are working," said Robert E. Davis, president and CEO. "Our gross margin for the second quarter was nearly 50%, up nearly one percentage point from a strong year-ago level, and increased from 43.5% in the first quarter of the year."

Davis added, "The second half of the year is traditionally stronger than the first half in operating revenues. Order intake is running at a rate in excess of last year. The second half should also benefit from the introduction of the newly designed DSC and DMTA thermal instruments as well as a new stress rheometer and the Company's proprietary Orchestrator software based on Microsoft(R)'s Windows(R) 95 technology."

Note to Editor: Rheometric Scientific, founded in 1970, develops, manufactures, markets, and services rheological and thermal analysis instrument systems, on-line rheological sensors, and integrated systems for research, product development, process control, and quality assurance. The company serves an international market from its headquarters in Piscataway, and subsidiaries in the United Kingdom, Germany, France and Japan.

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             CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                  (in thousands, except per share data)

                       Three Months Ended       Six Months Ended
                             June 30,                June 30,
                       1996          1995       1996        1995

Sales               $ 10,826      $ 11,875   $ 18,822    $ 20,476
Cost of sales          5,424         6,037      9,941      10,617
Gross profit           5,402         5,838      8,881       9,859
Marketing and selling
  expenses             2,487         2,442      5,151       4,932
Research and
  development expenses   707           720      1,463       1,474
General and
  administrative expenses 748          915      1,336       1,743
Goodwill and intangible
  amortization           165           163        330         325
Loss on sale/leaseback    --            --      2,368          --
                       4,107         4,240     10,648       8,474
Operating income (loss) 1,295        1,598     (1,767)      1,385
Interest expense,
  foreign currency
  (loss)/gains, and
  other                 (544)         (357)    (1,027)      (540)
Income (loss) before
  income taxes           751         1,241     (2,794)       845
Income tax expense        (4)          (50)        (7)       (57)
Net income (loss)      $ 747        $1,191    $(2,801)     $ 788
Net income (loss) per
  share                $0.06        $ 0.09    $ (0.21)     $0.06
Average number of
  shares outstanding  13,162        13,162     13,162     13,162

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CONTACT: RHEOMETRIC SCIENTIFIC

John C. Fuhrmeister, 908/560-8550