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 PORTLAND, Ore., Nov. 10 /PRNewswire/ -- Riedel Environmental Technologies Inc. (RET) (AMEX: RIE) announced today that the company incurred a loss of $884,000 or 24 cents per share on revenues of $18.3 million for the quarter ended Sept. 30, 1993. For the same period a year ago the company made the profit of $1.1 million on $17.1 million of revenue.
 The company's revenues from government contracts have increased by $2.9 million and $5.8 million for the third quarter and the nine months ended Sept. 30, 1993 compared to the same periods a year ago, as a result of the award of the EPA Region 5 ERCS contract in the fall of 1992 as well as several other smaller contracts in this sector of business. However, private sector revenues declined $1.8 million and $5.6 million for the quarter and nine months, respectively. Gross profit decreased by $450,000 in the third quarter when compared to the same period a year ago due to the decline of the more profitable private sector work.
 Selling, general and administrative expenses of $4.9 million for the 1993 third quarter were $800,000 more than the same period in 1992 resulting from offices and staff required for the EPA Region 5 contract, the costs of wrapping up company business in Taiwan and the unutilized labor costs associated with the decline in private sector revenue. The company's accounting practices classify staff time which is not billable as an overhead cost.
 The company incurred a one-time loss as a result of flooding of its Chesterfield, Mo. facilities in the third quarter of 1993. The damage to the building and equipment is estimated at $250,000. This estimated loss is included in other income (loss).
 In the third quarter the company implemented a cost reduction program that included staff reductions and reductions in certain corporate administrative salaries. In addition, the company has retained a nationally recognized consulting firm to determine other areas where costs can be reduced and efficiencies can be achieved. Separation costs and costs of consultants hired to aid in cost cutting measures have minimized the effect of actions taken to date. Arthur A. Riedel, chairman and chief executive officer said, "We expect that our administrative costs will decrease in the future and are committed to taking whatever action is required to return RET to profitability, even at these reduced business revenues."
 Separately, the company has signed a Letter of Intent to sell the assets of its Riedel OMNI Rubber Products (OMNI) subsidiary. The terms of the sale call for the purchaser to pay cash and assume debt amounting to $11.3 million. Proceeds from the sale, expected to be completed before Dec. 31, 1993, will be applied to reduce bank debt ($5.0 million) and long term senior debt ($6.3 million). The results of operations of OMNI are included as discontinued operations.
 In a previous announcement the company stated that it postponed an interest payment due Oct. 11, 1993 on its 7 percent Convertible Subordinated Debentures due 1999. The company is preparing information and expects to have a proposal for debenture holders within 30 days.
 (Unaudited, in thousands, expect per share data)
 Three months ended Nine months ended
 Sept. 30, 1993 1992 1993 1992
 Revenues $18,252 $17,104 $57,503 $58,305
 Costs 13,521 11,923 42,541 43,369
 Gross profit 4,731 5,181 14,962 14,936
 Selling, general &
 expenses 4,862 4,064 15,218 12,743
 Operating income (loss) (131) 1,117 (256) 2,193
 Interest expense (592) (460) (1,732) (1,727)
 Other income (loss) (249) 7 (196) 115
 Income (loss) from
 continuing operations
 before income taxes (972) 664 (2,184) 581
 Income tax benefit (105) 0 (361) 0
 Income (loss) from
 continuing operations (867) 664 (1,823) 581
 Income (loss) from
 discontinued operations (17) 449 (455) 910
 Net income (loss) $ (884) $ 1,113 $(2,278) $ 1,491
 Net income (loss) per
 common share:
 Income (loss) continuing
 operations $ (0.23) $ 0.17 $ (0.48) $ 0.16
 Income (loss) from
 discontinued ops. (0.01) 0.12 (0.12) 0.25
 Net income (loss) $ (0.24) $ 0.29 $ (0.60) $ 0.41
 -0- 11/10/93
 /CONTACT: Dave Rynd, vice president, executive assistant to chief executive officer, of Riedel Environmental Technologies, 503-286-4656/

CO: Riedel Environmental Technologies Inc. ST: Oregon IN: ENV SU: ERN

RB-AL -- SE010 -- 2800 11/10/93 13:32 EST
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Publication:PR Newswire
Date:Nov 10, 1993

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