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RELIANCE ELECTRIC COMPANY ANNOUNCES FIRST QUARTER RESULTS

 CLEVELAND, April 14 /PRNewswire/ -- Reliance Electric Company (NYSE: REE) announced a 4 percent increase in net sales for the first quarter 1993 over the same period last year. Sales of $388 million for the quarter ended March 31, 1993 compared to 1992 first quarter sales of $373 million. Reliance had fourth quarter 1992 sales of $399 million.
 Net earnings (before extraordinary items) of $12 million, or $0.23 per share, for the first quarter of 1993 compared to $6 million, or $0.04 per share, in the first quarter of 1992. The increase results principally from lower interest expense, which was $7 million in the first quarter of 1993 compared to $20 million in the first quarter of 1992. Weighted average shares outstanding increased by 17,392,387 (52 percent) as a result of a May 1992 initial public offering of common stock.
 Earnings before interest and taxes of $28 million for the first quarter of 1993 compared to restated 1992 first quarter earnings of $32 million. Earnings before interest and taxes for the fourth quarter of 1992, also restated, were $30 million.
 Reliance has adopted FAS 109 ("Accounting for Income Taxes") and FAS 106 ("Employers' Accounting for Post Retirement Benefits") in the first quarter of 1993. Prior year earnings were restated to reflect the retroactive adoption of FAS 109. Earnings before interest and taxes for each of the 1992 quarters have been reduced by $2 million, with similar decreases in income tax expense. Therefore, the company's 1992 quarterly earnings before extraordinary items and net earnings were not affected by the adoption of FAS 109. The adoption of FAS 106 for its United States post-retirement benefit plans has no material effect on the company's financial position or results of operations. Reliance has been on accrual based accounting for post-retirement benefits since 1987.
 "Our lower financial leverage is helping to offset some of the weakness which still exists in parts of our industrial business," commented John C. Morley, chief executive officer of Reliance Electric Company. "Despite the steady demand for small to intermediate size motors, electrical drives and controls and mechanical power transmission products, and very broad based demand for our telecommunications products and services, the lack of capital project spending by many of the process industries which we serve has hurt our engineered systems businesses. This lack of engineered product in our mix of orders is also evident in our gross margins and operating earnings. Sales of our electric transformers are also down due to year over year lower backlog and weak demand from the electric utilities. With the demand for large, engineered systems remaining uncertain, we have taken various actions to reduce costs near term and more effectively allocate our engineering and manufacturing resources on a long term basis."
 Reliance Electric Company, headquartered in Cleveland, designs, manufactures, sells and services a broad range of industrial and telecommunications equipment and has annual sales in excess of $1.5 billion. Reliance operates 48 manufacturing plants worldwide in 9 countries and employs approximately 14,000 people.
 Reliance Electric Corporation
 Earnings Information
 Three Months Ended
 March 31, 1993
 (unaudited)
 (in millions except per share data)
 1993 1992(A)
 Net sales $ 388 $ 373
 Cost and expenses:
 Cost of sales 292 276
 Selling, general and administrative 66 66
 Other 2 (1)
 Earnings before interest and taxes 28 32
 Interest expense 7 20
 Earnings before taxes 21 12
 Provision for income taxes 9 6
 Earnings before extraordinary items 12 6
 Extraordinary items, net of tax -0- -0-
 Net earnings $ 12 $ 6
 Net earnings $ 12 $ 6
 Less preferred stock dividends and
 accretion -0- 5
 Net earnings available for common
 stock $ 12 $ 1
 Net earnings per equivalent share
 of common stock (after preferred
 stock dividends and accretion):
 Earnings before extraordinary items $ .23 $ .04
 Extraordinary items -0- (.01)
 Net earnings $ .23 $ .03
 Weighted average equivalent shares of
 common stock outstanding 50,798,292 33,405,905
 (A)-- Restated to reflect retroactive adoption of FAS 109 (Accounting for Income Taxes)
 -0- 4/14/93
 /CONTACT: P. Kelly Tompkins of Reliance Electric Corporation, 216-266-5809/
 (REE)


CO: Reliance Electric Corporation ST: Ohio IN: TLS SU: ERN

BM -- CL004 -- 5545 04/14/93 09:03 EDT
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Date:Apr 14, 1993
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