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MFRI Reports Record Nine Months Results; Third Quarter Earnings Also At Historic High.

NILES, Ill.--(BUSINESS WIRE)--Nov. 25, 1996--MFRI, Inc. (NASDAQ, NM: MFRI), a leading manufacturer of custom-designed industrial filtration products, specialty piping systems and electronic leak detection systems, today reported results for the third quarter and nine months ended Oct. 31, 1996. Revenues, net income, gross profit and earnings per share all set records for the first nine months of the year.

Third quarter earnings were also a record. Net income rose to $1,192,000, or 26 cents per share, from $897,000, or 20 cents per share, for the same period last year. Revenues were $25,326,000, compared with $25,883,000 for last year's third quarter.

Nine month net income was a record $2,718,000, or 59 cents per share, compared with $1,978,000 or 44 cents per share a year earlier. Revenues rose to $70,281,000 from $65,762,000 reported for the same period last year.

David Unger, chairman, president and chief executive officer, said, "We are very pleased with our results for the first nine months of this year. During the past year, we focused on improving our gross profit margin. We have improved margins each quarter this year, and believe further increases are still possible.

"Third quarter gross profit margins reached 24.3 percent up significantly from 18.7 percent for the same period last year. For the first nine months of the year, our margins climbed to 23.2 percent from 19.4 percent for the same period last year. These increases in profitability resulted from favorable market conditions, particularly at Midwesco Filter, and higher manufacturing and customer service efficiencies at both Perma- Pipe and Midwesco Filter. The improved mix of our proprietary products also contributed to the sharp margin improvement, he added.

"In pursuit of our growth strategy to target promising new markets, we look forward to the successful completion of the Thermal Care acquisition in the near future," Unger concluded.

MFRI reported that its board had authorized it to distribute proxys describing the pending merger with Midwesco, Inc., thus acquiring the Thermal Care Division. The proxys were distributed on November 12th to stockholders of record on November 7th. A special stockholder meeting will be held on December 16th to tally the proxys received. David Unger said, "MFRI's acquisition of the Thermal Care business is expected to add $20 million to its sales and to be accretive to earnings per share".

MFRI is a vertically integrated manufacturer and marketer of filter bags under the Midwesco Filter name and specialty piping systems and electronic leak detection and location systems marketed under the Perma-Pipe name. Midwesco Filter bag products include proprietary Seamless Tube filter and related parts, accessories and services for use in industrial air pollution control systems. Perma-Pipe's piping system products include secondary containment piping systems for transporting hazardous fluids and petroleum products, and insulated or insulated and jacketed piping systems for efficient energy distribution. Perma- Pipe's electronic leak detection and location systems are used in conjunction with its secondary containment piping and district heating and cooling systems, and in other applications. -0-
MFRI
Financial Highlights (Unaudited)

 For the Three Months EndedFor the Nine Months Ended
 10/31/96 10/31/95 10/31/96 10/31/95

Net sales $25,326,000 $25,883,000 $70,281,000 $65,762,000

Gross profit 6,150,000 4,834,000 16,296,000 12,790,000

Income from operations 2,239,000 1,620,000 5,319,000 3,798,000

Net income 1,192,000 897,000 2,718,000 1,978,000

Net income per
 common share $.26 $.20 $.59 $.44

Average number of
 shares of common stock
 outstanding 4,612,000 4,557,000 4,580,000 4,538,000




CONTACT: MFRI, Inc.

David Unger, Chairman

(847) 966-1000
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Publication:Business Wire
Date:Nov 25, 1996
Words:632
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