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FLORIDA STEEL GAINS RESTRUCTURING TIME FROM BANK GROUP

 FLORIDA STEEL GAINS RESTRUCTURING TIME FROM BANK GROUP
 TAMPA, Fla., April 23 /PRNewswire/ -- FLS Holdings Inc. (NASDAQ-NMS: FLSHP), parent company of Florida Steel Corporation, today announced that the company's bank group has entered into a Standstill Agreement which extends through Sept. 30, 1992, the banks' waiver of certain financial covenant defaults under the company's senior term loan and revolving credit agreement. The Standstill Agreement also reschedules the principal payments, each for $5 million, due to the banks in May and August 1992, to Oct. 1, 1992.
 As previously announced on April 15, the company reported net income of $242,070 for the quarter-year ended March 31, 1992, representing a return to profitability following six quarter-years of net losses. Income from operations for the quarter was $10.0 million vs. $4.2 million a year ago, reflecting an improvement of 138 percent.
 Earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter was $14,627,538 vs. $8,564,438 for the same quarter a year ago. Results for the six months ended March 31, 1992, also showed improvement. EBITDA for the six months ended March 31, 1992, was $23,289,582, up from $21,739,818 for the comparable period a year earlier.
 "Our improved financial results for the quarter-year just ended, combined with the confidence in our ability demonstrated by our banks entering into the Standstill Agreement, improves our ability to develop a rational plan to restructure the company's balance sheet," commented Edward L. Flom, chairman and chief executive officer.
 "We believe that our fundamental business is sound, as reflected in our recent financial results, so that a restructuring of the company's indebtedness will result in a strong and profitable company going forward. Over the next few months, we look forward to working out a restructuring plan which is fair and acceptable to all affected parties, while continuing our normal operations and maintaining our strong relationships with our customers and vendors," Flom added.
 The company continues to engage in discussions with a number of third parties regarding the possible sale of all or a portion of its equity and will continue to pursue such alternatives in the context of developing a restructuring plan.
 The Standstill Agreement requires the company to present a business plan to the banks by May 15, 1992; present a restructuring plan to the banks by June 1, 1992; file with the Securities and Exchange Commission by Aug. 15, 1992, an S-4 registration statement or similar disclosure documents as required by such a plan; and not make an interest payment due on May 15, 1992, to the holders of its 14.5 percent subordinated debentures.
 The company has entered into discussions with an unofficial steering committee of bondholders which, in the aggregate, hold approximately one-third of the outstanding subordinated debentures. The company has also agreed in principle to pay the fees and expenses of the legal counsel and financial advisors for the Bondholder Committee. Based on such discussions, the company is hopeful that the bondholders will support the company's restructuring efforts. However, no assurance can be given in that regard.
 Consistent with not paying interest to the bondholders on May 15, the company will also not pay the PIK dividend due on May 15, with regard to its outstanding preferred stock.
 The company, a Delaware corporation, owns 100 percent of the outstanding common stock of Florida Steel Corporation. Florida Steel Corporation is a Tampa-based steelmaker consisting of five electric steel mills, 15 reinforcing steel fabricating plants, two reinforcing steel epoxy coating facilities, a post-tension facility, a hollow metal door and hardware operation, a railroad track spike operation, a transportation division, and a subsidiary producing welded wire fabric and nails.
 -0- 4/23/92
 /CONTACT: Marvin F. Hill, chief financial officer of Florida Steel Corporation, 813-251-8811/
 (FLSHP) CO: Florida Steel Corporation ST: Florida IN: MNG SU: RCN


JB-AW -- FL009 -- 6401 04/23/92 12:33 EDT
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Publication:PR Newswire
Date:Apr 23, 1992
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