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SECURITY ENVIRONMENTAL SYSTEMS REPORTS HIGHER THIRD QUARTER FY 1993 RESULTS

 GARDEN GROVE, Calif., May 17 /PRNewswire/ -- Stephen I. Grossman, president of Security Environmental Systems (NASDAQ: SENV) reported today higher revenues and earnings for the third quarter of fiscal 1993 ended March 31, 1993. Revenues for the current quarter increased 32 percent to $2.6 million, compared to revenues for the same third quarter of fiscal 1992 of $1.98 million. Income before taxes for the third quarter of 1993 increased to $609,000 resulting in net income of $434,000, or $.04 per share. This compares with 1992 third quarter income before taxes of $152,000, resulting in net income of $152,000, or $.01 per share. The 1992 results included an extraordinary item of $61,000 relating to utilization of net operating loss carryforwards. For the nine months ended March 31, 1993, revenues increased to $10 million, compared to fiscal 1992 nine-month revenues of $5.5 million. Net income reached $2.0 million, or $.19 per share, including $.03 per share in extraordinary items. This compares with nine-month net income for fiscal 1992, of $402,614 and $.03 per share including $.01 in extraordinary items.
 Grossman commented on the results, saying, "The results of operations for the third quarter were approximately on-track with company expectations except for lower-than-anticipated hazardous waste pick-up activity at the company's Port Hueneme project. We had anticipated a higher hazardous waste pick-up schedule in the third quarter and staffed up to accomplish this task. However, we fell victim to certain scheduling delays which will push more revenues into the fourth fiscal quarter.
 "As we enter the fourth quarter, we expect a solid increase in revenue to be generated from hazard waste removal and disposal contracts at a variety of U.S. government military installations, including Camp Pendleton, Point Mugu, Port Hueneme, Vandenberg Air Force Base and other affiliated installations. We anticipate a continued upward general trend as a result of existing contracts and contracts to be awarded in the near future. The nine-month revenues for 1993 already exceed the annual results for 1992, setting the stage for continued operating improvements into the next fiscal year. If the company is awarded the contracts currently under negotiation, we anticipate 1994 revenues to exceed $15 million."
 Grossman noted that the company had recently sold its medical waste disposal business for consideration in excess of $5.0 million. A portion of the proceeds are earmarked to finance the company's hazardous waste transport business and to acquire an existing hazardous waste facility which will accelerate the growth and profitability of this division. "Going into the fourth quarter with the sale of our medical waste division, we have eliminated substantial overhead expenses including approximately $550,000 per year in salaries, $240,000 in workers' compensation costs and over $60,000 in insurance. We believe that the substantially lower overhead structure provides the basis for much higher profits in future operations. In addition, the sale of the medical waste business enabled Security Environmental Systems to cease operations at the Vernon facility, which will save the company more than $600,000 a year once the lease expires in January 1994. In the meantime, we are exploring opportunities to sell our option to purchase the property, and searching for a new site for a transportation distribution facility."
 Grossman noted that the company has submitted bids on a variety of U.S. government military installation contracts, with several of them entering the final stage of approval including Pensacola, Fla., valued at $5 million, and San Diego, valued at $9 million. In addition, Grossman said that the company would be submitting bids for additional contracts valued in excess of $14 million with the intent to provide service to military installations on a nationwide basis. "In addition to the substantial backlog of contracts being processed, we have also restructured our sales force to penetrate the hazardous waste marketplace at a much more rapid rate. We now have 30 people exclusively dedicated to this part of our business.
 "Given the strength of the balance sheet following a strong operational year-to-date and the sale of the biomedical waste division, management is excited that the company is in the strongest financial condition in its history, with current working capital in excess of $5 million, shareholders' equity of $5 million and cash and cash equivalents of $5.5 million. As we review the fiscal year-to- date and prospective opportunities, we believe that all the pieces are in place to produce an excellent 1993 year and beyond."
 Security Environmental Systems, founded in 1972, disposes of hazardous waste and conducts interstate transportation of hazardous waste. The company operates from facilities in Garden Grove, Vernon, and Long Beach, Calif. Most recently, the company has moved its New Mexico operations to Roswell, N.M.
 SECURITY ENVIRONMENTAL SYSTEMS INC. AND SUBSIDIARIES
 Consolidated Statement of Operations
 (Unaudited)
 Three Months Ended Nine Months Ended
 March 31, March 31,
 1993 1992 1993 1992
 Revenue $2,607,324 $1,978,836 $9,991,220 $5,485,348
 Expenses
 Operating 1,383,817 1,012,802 4,359,841 2,878,096
 General and
 administrative 517,159 724,011 1,852,911 1,947,062
 Provision for
 litigation settlement --- --- 450,000 ---
 Interest 123,022 127,625 504,163 350,876
 Other income (26,132) (37,376) (88,955) (93,300)
 Income before provision
 for income taxes and
 extraordinary items 609,458 151,774 2,913,260 402,614
 Provision for income
 taxes 175,050 (61,000) 1,188,000 (148,000)
 Income before
 extraordinary items 434,408 90,774 1,725,260 254,614
 Extraordinary items,
 tax benefit resulting
 from utilization of
 net operating
 carryforward --- 61,000 303,850 148,000
 Net income $434,408 $151,774 $2,029,110 $402,614
 Earnings per share
 Income before
 extraordinary items $.04 $.01 $.16 $.02
 Extraordinary --- --- .03 .01
 Net income per share $.04 $.01 $.19 $.03
 Weighted number of
 common shares
 outstanding 10,361,863 12,532,688 10,529,384 11,542,122
 -0- 5/17/93
 /CONTACT: Stephen I. Grossman, president of Security Environmental Systems, 213-262-3722; or William F. Coffin of Coffin Communications Group, 818-578-0500, for Security Environmental Systems/
 (SENV)


CO: Security Environmental Systems ST: California IN: ENV SU: ERN

LS-JL -- LA010 -- 9030 05/17/93 09:02 EDT
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Date:May 17, 1993
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