TRO Learning Demonstrates Dramatic Growth In Operating Income.

MINNEAPOLIS--(BUSINESS WIRE)--Sept. 17, 1998--

Significant PLATO Education Contracts Drive Record-Breaking

Results

TRO Learning announced today several significant contracts for PLATO(R) products and services that contributed to its record third quarter operating income. Revenues for high margin PLATO courseware and professional services increased 9 percent for the quarter and 26 percent for the nine months ended in July, compared to a year ago. "I am pleased with our third quarter and nine month results for fiscal 1998," said William R. Roach, chairman, president, and CEO of TRO Learning. "The consistent increase in revenues and the high demand for PLATO clearly demonstrates its continued leadership and acceptance in our target adolescent and adult markets. Our momentum remains healthy worldwide as we move into our historically-strong fourth quarter." The following summaries highlight some of the major PLATO contracts received, most of which are valued in excess of $125,000.

Navy Academic Skills Learning Centers

The Department of Defense (DoD) has approved the second year of the four-year Academic Skills Learning Center (ASLC) contract awarded to TRO Learning in 1997. During the first year of the contract, TRO Learning operated 21 centers, 10 of which are outside of the continental United States. In year two, 13 additional centers are scheduled to open, bringing the total to 34 centers by the end of FY 1999. TRO Leaning's FY 1999 revenues from the ASLCs will be nearly $3 million, compared to $1.8 million in FY 1998. The Center for Navy Analyses recently released a report which demonstrates a $20 return for every dollar spent on academic skills education.

John Murray, senior vice president of operations from TRO Learning, commented, "TRO Learning is delighted to have received official notification for year two of our four-year Navy Academic Skills contract. To be part of a program which has demonstrated such early success on a global basis, speaks highly of our people, products, and services. The Navy ASLC network has created an extremely favorable reference for TRO Learning in government training programs, which has already resulted in other DoD contracts. I also fully expect that this will lead to even more government education and training contracts in the next two years."

United Kingdom

The distribution agreement signed earlier this year with DeBell Information Systems Limited in Essex, England, which enabled DeBell to sell PLATO into Essex, Kent, and Scotland, has been expanded. DeBell can now provide PLATO through exchange rental programs to the Local Education Authorities (LEAs) within its regions. The agreement with DeBell will bring guaranteed annual revenues of over $250,000 to TRO Learning. DeBell has also just expanded its initial sale of PLATO to schools in Clackmannshire, Scotland.

The National Grid for Learning (NGFL) consortium, formed by DialNet of Birmingham, England, together with TRO Learning and a number of other U.K. companies, will officially launch its services to the U.K. education sector in London in November. The consortium brings together a wide range of capabilities, products, and services aimed at cost-effectively increasing the use of technology in education. PLATO - with its flexible delivery via local area networks, the Internet, intranets, and extranets - is seen as a key ingredient of the consortium's offering. At the November launch, consortium members will brief over 100 LEA executives, school and college principals, and government representatives. The British government is heavily funding the NGFL initiative.

Barnfield College in Luton has recently implemented the second of its three-phase PLATO installation throughout five campuses to address Key and Core Skills across its student populations. To date, 140 workstations have been installed with an additional 70 planned for next year. Jim Horrocks, principal and chief executive of Barnfield College, commented, "Barnfield is the largest further education provider in Bedfordshire. We have invested in PLATO as part of a strategic plan to offer innovative learning opportunities to our students and the business community throughout the county and beyond." He continued, "The vast range of courseware - from basic numeracy and literacy to advanced mathematics, communication, and work skills - provides us with the flexibility to deliver relevant courses to meet our students' varied needs. What is particularly advantageous, is the fact we can deliver PLATO throughout our campus via our own network or via the Internet. All the while, PLATO's powerful management system (PLATO(R) Pathways) provides us with assessment, prescription, and reporting capabilities that allow us to target instruction and track student performance."

In a contract valued at over $600,000, the PLATO School-To-Work curriculum will be used to deliver Core Skills instruction across three campuses at Newham College East London. Newham, one of the largest colleges in London, selected PLATO following an exhaustive review of course content and a recommendation by the Further Education National Council (FENC). As the U.K. government has recently made a significant financial investment in education, Newham is also working with TRO Learning to identify and implement opportunities within the local business community to provide vital skills to support lifelong learning and skills upgrading for its workforce.

West Thames College in West London has completed its implementation of PLATO School-To-Work courseware, which will be used to deliver instruction for Core Skills and GNVQ application of number and communication levels 1, 2, and 3. Mr. Gerrard O'Donnell, principal of West Thames College is also the Chairman and Chief Executive of FENC, which offers preferential pricing on PLATO courseware to the more than 180 FENC members. Within the past six weeks, PLATO has been selected by a number of FENC colleges as a result of its superior curriculum and this pricing advantage.

Lowton High School in Warrington will use PLATO on 15 workstations to promote independent learning across its curriculum, especially for both gifted and remedial special needs students. PLATO was selected based on the modular structure of the courseware and the control that the PLATO(R) Pathways management system provides instructors without compromising the independence of students. Lowton will work with PLATO Education to communicate the effectiveness of PLATO to other schools in the Wigan area and the North West of England.

Swansea College in Wales has purchased the PLATO WorkSkills curriculum to integrate both basic skills and Key Skills into its curriculum. PLATO Education will also work with Swansea to provide community-wide learning opportunities with PLATO. Little Lever High School in Bolton has purchased the PLATO Core Numeracy and Literacy modules for use on15 workstations. Little Lever's long-term goal is to be a leading reference site for integrated learning systems (ILS) in the Greater Manchester area and plans to present PLATO as the ILS of choice to the Bolton Local Education Authority which is in the process of reviewing a number of PLATO courses.

On these significant initiatives, TRO's John Murray commented, "The announcement made at the beginning of this year by the U.K. government of a $600 million plus, four-year funding initiative to accelerate the use of technology in education has created great excitement and expectation in what, until now, has been an immature market. I am pleased to say that TRO Learning has not only continued to expand its position as the leading provider of computer-based educational content to colleges of Further Education, but that it has started to see an acceptance of PLATO products by a number of secondary schools.

PLATO is rapidly being recognized as the most comprehensive adolescent and adult educational product available in the U.K. Already in a strong position in England, this year we have seen our initial sales in Scotland, Wales, and Ireland. Our PLATO U.K. revenues are up 50 percent as compared to last year, a growth rate we expect to continue through our direct sales efforts and our existing and imminent distribution agreements."

North America

Medford School District in Medford is the largest school district in southern Oregon. With the goal of becoming the leading provider of alternative learning opportunities, Medford will expand its existing PLATO installation in a contract valued at approximately $170,000. Citing an overall "fit" with the district's needs, PLATO was chosen to help prepare Medford students to pass the Oregon CIM/CAM (Certificate of Initial Mastery/Certificate of Advanced Mastery) state assessment tests, as well as for credit recovery. The district also has plans to establish PLATO-based ESL labs at its middle and high schools in the future. The Northwest Regional Educational Service District in Hillsboro, Oregon, has also expanded its use of PLATO by purchasing PLATO for nine separate entities in the greater Portland area in a contract valued at over $200,000. PLATO will be used in alternative education programs and programs designed to provide remedial instruction for students preparing for the 8th and 10th grade CIM state assessment test. PLATO was selected by the Service District based on its success in alternative education programs throughout Oregon, as well as at a CIM preparation lab in Forest Grove.

Houston Independent School District (H.I.S.D.), in an expansion from its purchase earlier in the year, has purchased PLATO licenses for four schools in its North District. As part of the contract, Sam Houston High School will be adding licenses to its existing PLATO lab, which is used to prepare students for the Texas Assessment of Academic Skills (TAAS) exam. With support from the school's principal for the use of PLATO as a daily teaching tool in language arts and math, the new licenses will be used to provide whole-group instruction in classrooms. In the first middle school application of PLATO within H.I.S.D., North District's three middle schools will use PLATO for TAAS remediation in various lab formats: one will have two labs for math and language arts; one will have a PLATO lab available for teachers working with at-risk students and TAAS Remediation; and the third will implement a standard lab for TAAS remediation.

Kalamazoo Central High School in Kalamazoo, Michigan, has been a PLATO client for over three years. Based on its success with PLATO, the school recently added 35 licenses to its existing 21 licenses to help more at-risk students sharpen their basic skills and prepare for the Michigan High School Proficiency Test. Shortly after Central High School made the decision to increase its PLATO installation, three area middle schools - Milwood Middle School, South Middle School, and Hillside Middle School - purchased PLATO as well. What is unique about this implementation in the Kalamazoo Public Schools is the fact that each school will soon access PLATO through the district's wide area network instead of local area networks.

Highland Park Independent School District (ISD) in Amarillo, Texas plans to make PLATO accessible in every classroom throughout the district. Based on his success with PLATO in significantly improving test scores on the TAAS at a another district, Superintendent Jerry Wright chose to implement PLATO district-wide at Highland Park with the goal of reaching Exemplary School status. Wright plans to mandate the use of PLATO in grades 2-12, whereby each student will be required to utilize PLATO for two hours each week. Judson ISD in San Antonio,Texas will begin using PLATO in two high schools in late September, with likely plans to expand the installation to two alternative schools and three middle schools. When completed, this will be the first district-wide installation of PLATO in San Antonio.

Elsewhere in Texas, Cleveland Independent School District has purchased PLATO to help increase TAAS scores at Eastside Elementary School, Cleveland Junior High School, and Cleveland High School. Future plans include the use of PLATO as a supplement to instruction in mainstream classes and for GED and English as a second language classes to be offered to the community in the evening. Carrollton/Farmers Branch Independent School District has purchased 100 PLATO licenses for four schools based on the results of an extensive evaluation. PLATO will initially be used at R.L. Turner High School for TAAS improvement and Title 1 students. Three alternative schools will also use PLATO as a primary, supplemental, and complementary instructional resource to meet the varied needs of its students.

TRO Learning is the leading developer and marketer of microcomputer-based, interactive, self-paced instructional systems. With fiscal 1997 revenues of $37 million, TRO Learning, Inc. is a publicly held company traded as TUTR on the NASDAQ-NMS. Offering more than 2,000 hours of comprehensive academic and applied skills courseware designed for young adult and adult learners, PLATO Learning Systems are marketed to middle and high schools, colleges, job training programs, correctional institutions, military education programs, and corporations. The PLATO Learning System is delivered via networks, CD-ROM, the Internet, and private intranets.

TRO Learning is an international training and education company with headquarters located at 4660 West 77th Street, Edina, Minnesota 55435, [phone] or [phone]. TRO's executive offices are located at Poplar Creek Office Plaza, 1721 Moon Lake Boulevard, Suite 555, Hoffman Estates, Illinois 60194, [phone]. TRO Learning has domestic offices located throughout the United States, and international offices in the United Kingdom, and throughout Canada. TRO Learning has international distributors located in Brunei, Costa Rica, Korea, Malaysia, Panama, Puerto Rico, Singapore, South Africa, Taiwan, and the United Arab Emirates. The company's Web site addresses on the Internet's World Wide Web are www.tro.com or www.plato.com

(R) PLATO is a registered trademark of The Roach Organization, Inc. All company names and product names are trademarks or registered trademarks of their respective holders