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GRAHAM-FIELD HEALTH PRODUCTS, INC. REPORTS THE RESULTS FOR THE FOURTH QUARTER AND YEAR ENDED DEC. 31, 1992

 HAUPPAUGE, N.Y., March 10 /PRNewswire/ -- Graham-Field Health Products, Inc. (NYSE: GFI), a manufacturer and supplier of healthcare products, today reported the results for the year ended Dec. 31, 1992. Revenues for the year were $84,104,000 as compared to $57,145,000 for 1991, a 47 percent increase. Income before income taxes was $1,992,000 as compared to $4,513,000 for the prior year. The income before income taxes for 1992 includes a reorganization charge of $1,640,000 related primarily to the opening of the company's St. Louis distribution facility. Net income was $1,245,000 or $.10 per share on 12,719,000 weighted average shares outstanding as compared to $3,956,000 or $.40 per share on 9,988,000 weighted average shares outstanding for the prior year. The income for 1992 was taxed at a rate of 38 percent versus the 1991 tax rate of 12 percent.
 For the quarter ended Dec. 31, 1992, revenues were $24,375,000 as compared to $16,487,000 for the same period last year, a 48 percent increase. Loss before income taxes was $1,461,000 as compared to income before income taxes of $1,356,000 for the same period last year. The loss before income taxes for 1992 includes a reorganization charge of $1,640,000 related primarily to the opening of the company's St. Louis distribution facility. Net loss was $808,000 or $.06 per share on 12,816,000 weighted average shares outstanding as compared to net income of $1,076,000 or $.09 per share on 12,462,000 weighted average shares outstanding for the prior year.
 The increase in revenues for the year 1992 was primarily due to the increase in product lines resulting from the company's acquisition of Diamond Medical Equipment Corp. and National Health Care Equipment Inc., on May 28, 1992, along with the continued growth and acceptance of the company's Consolidation Advantage Program ("CAP"), by its customers.
 On Oct. 1, 1992, the St. Louis distribution center, the company's largest facility, officially came on-line. During the fourth quarter of 1992, and continuing into the first quarter of 1993, this facility has significantly increased its operations with the ultimate goal of replacing the company's Hauppauge, Long Island, facility as the company's primary distribution center. The transition has required the movement of a significant amount of product, training a completely new work force and restructuring the company's entire order processing system. In addition, significant additional freight costs were incurred as a result of a large number of orders not being shipped completely from one warehouse, but rather requiring multiple shipments from different warehouses. The costs related to the reorganization were greater than anticipated and were principally of a one-time duplicate nature. Such excess selling, general and administrative cost totalled $1,640,000, of which $472,000 is to be incurred in the first quarter of 1993 and accrued in the fourth quarter of 1992, and have been classified in the financial statements under the caption "reorganization charge."
 In addition to the excess selling, general and administrative costs, the mix of sales resulted in an overall lower gross profit margin for the fourth quarter as compared to prior periods. The growth in revenues for the year was primarily in the home healthcare marketplace, which historically has lower profit margins than in the hospital/physician market. The company expects that the lower gross profit margin associated with the continuing growth in the home healthcare market will at least partially be offset by gross profit margin improvements resulting from purchasing and manufacturing efficiencies.
 On the positive side, in 1993 the number of employees in the distribution network has been reduced by 30 percent, and further reductions are planned for the remainder of the year. Certain temporary warehouse locations in New York have also been eliminated. It is presently anticipated that substantially all inventory movements to the appropriate facility will be completed within the next few weeks, thus enabling the company to get closer to achieving the goal of shipping the majority of orders complete from one location, reducing overall freight and handling costs.
 At the present time, the St. Louis distribution center is shipping more orders than any other facility and doubled its shipments in the month of February as compared to the prior month. It is anticipated that, by the end of the second quarter 1993, the St. Louis distribution center will be shipping approximately 75 percent of normal customer orders.
 Irwin Selinger, chairman and chief executive officer, stated, "While the fourth quarter was disappointing, we are beginning to realize the goals we have set for ourselves. We believe we are positioning Graham- Field to become a cost-effective supplier to the healthcare industry. This will allow our customers to lower their selling prices without reducing their profit margins, which is in-line with the Clinton Administration healthcare proposals. We expect, as our CAP concept becomes more accepted by our customers, and healthcare products and services become more available to all Americans, Graham-Field will grow and prosper."
 Graham-Field manufactures, markets and distributes approximately 20,000 healthcare products for hospital, physician and home use to approximately 16,000 home healthcare, physician, hospital supply and pharmaceutical distributors, retailers and wholesalers.
 GRAHAM-FIELD HEALTH PRODUCTS, INC. AND SUBSIDIARIES
 Consolidated Condensed Statements of Operations
 Periods ended Three Months Year
 Dec. 31 1992 1991 1992 1991
 Revenues $24,375,000 $16,487,000 $84,104,000 $57,145,000
 Cost and exps.:
 Cost of revs. 16,917,000 9,868,000 55,194,000 34,222,000
 Selling, general
 and admin. 6,820,000 5,072,000 23,610,000 17,125,000
 Interest expense 459,000 191,000 1,668,000 1,285,000
 Reorganization
 expense 1,640,000 -- 1,640,000 --
 Total 25,836,000 15,131,000 82,112,000 52,632,000
 (Loss) income before
 income taxes (1,461,000) 1,356,000 1,992,000 4,513,000
 Income taxes (653,000) 280,000 747,000 557,000
 Net income $ (808,000) $ 1,076,000 $ 1,245,000 $ 3,956,000
 (Loss) income
 per share $ (.06) $ .09 $ .10 $ .40
 Weighted average
 number of common
 and common
 equivalent shares
 outstanding 12,816,000 12,462,000 12,719,000 9,988,000
 -0- 3/10/93
 /CONTACT: Gary M. Jacobs, chief financial officer of Graham-Field, 516-582-5900/
 (GFI)


CO: Graham-Field Health Products, Inc. ST: New York IN: HEA SU: ERN

GK -- NY002 -- 4837 03/10/93 09:34 EST
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Date:Mar 10, 1993
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