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ECOLAB REPORTS 5 PERCENT DECLINE IN SECOND QUARTER EARNINGS

 ECOLAB REPORTS 5 PERCENT DECLINE IN SECOND QUARTER EARNINGS
 ST. PAUL, Minn., July 27 /PRNewswire/ -- Ecolab (NYSE: ECL) today reported that strong second quarter results from its ongoing U.S. and international operations were offset by higher net interest expense and soft joint venture profits.
 Ecolab's net sales for the quarter rose 12 percent to $247 million led by strong U.S. and international results. However, earnings from continuing operations for the second quarter ended June 30, 1992, declined 5 percent to $14 million from the year ago period due to the previously mentioned higher interest expense and the impact of recession in major European economies which weakened Henkel-Ecolab joint venture income. Because of a 32 percent increase in outstanding shares, earnings per share from continuing operations were $0.46 compared with $0.56 a year ago.
 Net sales for the six months increased 12 percent to $481 million. Earnings from continuing operations for the six months ended June 30 rose 13 percent to $26 million from last year. Earnings per share from continuing operations were $0.82 compared with $0.80 a year ago also reflecting the increased shares outstanding.
 Pierson M. Grieve, Ecolab's chairman, president and chief executive officer commented on the results saying, "We are very pleased with the results of Ecolab's U.S. and international operations. Despite the slow economic recovery in the U.S., our businesses showed good sales gains. Tight cost controls led to margin improvement. We also made important competitive gains in the marketplace. Though the Henkel-Ecolab joint venture is facing a challenging economic environment in Europe, it is successfully integrating its operations and we are satisfied with its progress in the face of the current difficult economies."
 Regarding the balance of the year, Grieve stated, "The second half is expected to show favorable comparisons. Our U.S. and international businesses continue to look strong, and we will benefit as per share results begin to compare against periods with similar outstanding share levels. We continue to expect to post significant earnings per share improvement for the full year 1992."
 Ecolab's U.S. sales rose 8 percent to $189 million in the second quarter led by continued good growth from the Institutional Division and double digit gains from both the Pest Elimination and Janitorial businesses. U.S. operating income increased 10 percent to $29 million as margins rose due to continued tight expense controls.
 International sales rose 27 percent to $58 million in the second quarter as strong sales gains in Asia Pacific and Latin America and revenues from the purchase of the Henkel businesses in July 1991, offset a decline in the Canadian Janitorial business. International operating income rose 25 percent to nearly $1 million.
 The Henkel-Ecolab joint venture results reflected the current recession and labor unrest in the major European economies. Total revenues for the joint venture's second quarter were $197 million, up 2 percent from pro-forma second quarter 1991 levels. Ecolab's equity in earnings from the Henkel-Ecolab joint venture in the second quarter was $2 million, with earnings reflecting lower than plan revenue levels due to the continuing weak European economic climate.
 Ecolab's second quarter 1992 selling, general and administrative costs reflect increased investment in its sales force and distributor expansion. Selling, general and administrative costs for 1991 are net of Ecolab's Europe operating profits of $4.5 million and $6.9 million for the second quarter and six months, respectively, earned prior to the formation of the joint venture. Interest expense rose reflecting the October 1991 placement of $100 million of 9.68 percent notes. The effective tax rate declined in the second quarter to 33.5 percent from 36.2 percent in the prior year due to an improved performance by international operations.
 Ecolab is a leading worldwide developer and marketer of premium cleaning, sanitizing and maintenance products and services for the hospitality, institutional and industrial markets. Ecolab's shares are traded on the New York Stock Exchange and the Pacific Stock Exchange under the symbol ECL.
 ECOLAB INC.
 CONSOLIDATED STATEMENT OF INCOME
 (Unaudited) (Thousands, except per share)
 Second Quarter Ended Six Months Ended
 6/30/92 6/30/91 6/30/92 6/30/91
 Net sales
 United States $188,962 $175,626 $367,377 $341,949
 International 58,244 45,750 113,851 86,618
 Total 247,206 221,376 481,228 428,567
 Cost of sales 112,518 101,869 219,229 200,239
 Selling, general and
 administrative expenses 106,499 89,211 211,562 179,348
 Operating income
 United States 28,923 26,222 50,465 45,466
 International 913 730 3,360 (1,094)
 Europe 4,536 -- 6,927 --
 Corporate (1,647) (1,192) (3,388) (2,319)
 Total 28,189 30,296 50,437 48,980
 Interest expense, net 9,187 6,684 18,803 13,379
 Income from continuing
 operations before income
 taxes and equity in earnings
 of joint venture 19,002 23,612 31,634 35,601
 Provision for income taxes 6,371 8,548 10,881 12,888
 Equity in earnings of
 Henkel-Ecolab joint venture 1,706 4,824 -- --
 Income from continuing
 operations 14,337 15,064 25,577 22,713
 (Loss) from discontinued
 ChemLawn operations -- (130) -- (12,732)
 Cumulative effect of the
 change in accounting for
 postretirement health
 care benefits -- -- -- (24,560)
 Net income (loss) 14,337 14,934 25,577 (14,579)
 Preferred stock dividends -- 1,925 -- 3,850
 Net income (loss) to common
 shareholders $14,337 $13,009 $25,577 $(18,429)
 Income (loss) per common share
 Continuing operations $0.46 $0.56 $0.82 $0.80
 Discontinued operations -- (0.01) -- (0.54)
 Change in accounting principle (1.04)
 Net income (loss) $0.46 $0.55 $0.82 $(0.78)
 Average common shares
 outstanding 31,330 23,671 31,301 23,643
 -0- 7/27/92
 /CONTACT: Michael J. Monahan of Ecolab Inc., 612-293-2809/
 (ECL) CO: Ecolab Inc. ST: Minnesota IN: CHM SU: ERN


DS -- MN006 -- 3489 07/27/92 11:43 EDT
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Date:Jul 27, 1992
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