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DYNASTY CLASSICS POSITIONS ITSELF FOR RETURN TO PROFITABILITY

 CARSON, Calif., May 20 /PRNewswire/ -- Dynasty Classics Corp. (NASDAQ: DNST) Chairman Craig A. Winn announced today "the company is being positioned to return to profitability during the second half of this year." He went on to say, "The company has focused its energies on the 10 core lighting categories where it enjoys its greatest competitive advantages. This strategy allowed the company to successfully discontinue less productive products. At the beginning of 1992, inventory exceeded $30 million. It has been reduced to under $18 million by successfully selling the discontinued products at a discount. Nearly all of the company's inventory is comprised of current product forecasted to sell over the next 120 days. This decrease in inventory had a negative impact on our quarterly performance but is believed to be a very beneficial ingredient in our expected return to profitability."
 The resulting product assortment reduction and dramatic inventory reduction have allowed the company to increase the rate and magnitude of expense cuts. As a result of the effective execution of a two- year plan to increase the range and capacity of its Maquiladora factory, the company is able to respond favorably to current economic conditions by ceasing this week its redundant domestic assembly.
 The company said it is pleased to announce that it expects to spend more than $9.0 million less on overhead and operating expenses in the next four quarters than was spent during the preceding four quarters. The expected resulting margin gain derived from emphasis on core high margin product, combined with a substantially reduced expense structure, gives the company reason to believe it is likely to return to profitability in the second half.
 In addition, the company expects increased lighting volume with the majority of its top 20 customers. The vast majority of this volume is on its most compelling product with a strong emphasis on new higher margin innovative lighting products including Dynastone table and floor lamps, light spectrum functional home office lighting and its revolutionary light triangle products. The company said it is pleased to announce that three of its four most innovative and comprehensive new product category introductions are ahead of schedule and should begin production in June.
 The entire strategic plan, including product mix and expense reduction, has been recently presented to the company's key executives, the board of directors and the company's lending institution. The plan received unanimous approval and support. With these important endorsements, the company plans to aggressively pursue these goals. The company said it would also like to point out that its current book value is $3.37 per share.
 Dynasty Classics designs and produces lighting products, home decor and Christmas items for distribution through leading retail channels including home centers, major national retailers, discount mass merchants and warehouse clubs.
 -0- 5/20/93
 /CONTACT: Michael J. Simmons, executive VP of Dynasty Classics, 310-834-3637/
 (DNST)


CO: Dynasty Classics Corp. ST: California IN: HOU SU:

MS-JL -- LA026 -- 0934 05/20/93 16:33 EDT
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Publication:PR Newswire
Date:May 20, 1993
Words:494
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