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NATIONAL ENVIRONMENTAL GROUP ANNOUNCES RESULTS

 NATIONAL ENVIRONMENTAL GROUP ANNOUNCES RESULTS
 NEW BRUNSWICK, N.J., Feb. 10 /PRNewswire/ -- National Environmental


Group, Inc. (AMEX: NEG) today announced its financial results for the fiscal quarter ended Dec. 31, 1991.
 The results include the company's oilwell services subsidiary ESKEY. Revenues and income from continuing operations for the quarter ended Dec. 31, 1991, were unchanged from the first quarter ended Sept. 30, 1991. The decrease in revenues and income from continuing operations from the previous year is a result of declining oil and gas prices, decreased drilling activity and continued rainy weather in West Texas. Despite these problems, the company said it was able to maintain higher equipment utilization rates than most of its competitors which allowed the company to remain profitable. Last year's results included a loss of $612,000 from National Environmental Remediation, Inc., which, as previously reported, was sold on June 30, 1991.
 The company said it expects that the decline in drilling activity in the United States and the uncertainty of future oil prices will continue for the foreseeable future which will result in decreased revenues and income from FY'91 levels.
 In December, the company acquired eight additional workover units and related equipment. ESKEY increased its borrowings from CIT (Fidelcor) to $4.1 million at Dec. 31, 1991, in order to complete the acquisition. The acquisition allowed the company to further expand its customer base among independent West Texas drilling companies.
 Over the past two years the company has achieved significant progress in reducing debt and consolidating operations. However, despite these improvements, which have returned the company to profitability, the board of directors recognizes that the company's current capital structure may cause the company to lose its listing on the American Stock Exchange. This is due to the ever increasing number of common shares outstanding, which is a result of quarterly dividends and the conversion option of the 14 percent convertible preferred stock. On a fully diluted basis the company may have in excess of 100 million shares outstanding on July 1, 1992. In addition, the board is concerned over the company's continued high debt levels and negative equity position. The board of directors has notified the American Stock Exchange that it will announce a recapitalization plan by March 31, 1992.
 NATIONAL ENVIRONMENTAL GROUP, INC.
 (In thousands, except per-share data)
 Periods ended Three months Six months
 Dec. 31 1991 1990 1991 1990
 Revenues $5,283 $6,244 $10,545 $11,575
 Costs and expenses 5,044 5,494 10,075 10,357
 Income from continuing
 operations before income
 taxes and extraordinary credit 239 750 470 1,218
 Income tax expense 81 255 160 414
 Income from continuing
 operations before
 extraordinary credit 158 495 310 804
 Discontinued operations:
 Loss from operations,
 net of applicable taxes --- (612) --- (744)
 Income (loss) before
 extraordinary credit 158 (117) 310 60
 Extraordinary credit 73 230 144 373
 Net income 231 113 454 433
 Preferred stock dividends 50 101 151 212
 Net income applicable to
 common stock 181 12 303 221
 Earnings per common share:
 Primary:
 Income from continuing
 operations before
 extraordinary credit $.01 $.03 $.01 $.05
 Income (loss) before
 extraordinary credit .01 (.02) .01 (.01)
 Net income .01 .00(A) .02 .02
 Assuming full dilution:
 Income from continuing
 operations before
 extraordinary credit .00(A) .01 .00(A) .00
 Income (loss) before
 extraordinary credit .00(A) (.01) .00(A) (.01)
 Net income .01 .00(A) .01 .01
 Average common shares
 outstanding:
 Primary 15,524 12,125 15,120 11,826
 Assuming full dilution 36,010 37,589 35,606 37,184
 (A) Earnings per common share less than $.01.
 /delval/
 -0- 2/10/92
 /CONTACT: Diane Mack of National Environmental Group, 908-247-4822/
 (NEG) CO: National Environmental Group, Inc. ST: New Jersey IN: SU: ERN


JS-KA -- PH028 -- 8463 02/10/92 16:38 EST
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