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TENNANT COMPANY REPORTS LOWER SALES AND EARNINGS FOR FIRST QUARTER 1993

 MINNEAPOLIS, April 15 /PRNewswire/ -- Tennant Company (NASDAQ: TANT) CEO Roger L. Hale today announced a decrease in sales and earnings before accounting changes for the first quarter ended March 31, 1993.
 Net earnings for the 1993 first quarter were $0.5 million, or 10 cents per share. This was 79 percent lower than prior year quarterly earnings of $2.4 million, or 48 cents per share, before cumulative effect of accounting change. For the 1992 first quarter, the company reported a restated net loss of $2.0 million, equal to -41 cents per share, reflecting a $4.5 million, or 91 cents per share, net charge to earnings for adopting Statement of Financial Accounting Standard No. 106 for post-retirement medical benefits.
 Net sales of $47.1 million for the quarter declined 4 percent from the prior year's $48.8 million. Sales were down 2 percent in North America and 8 percent overseas.
 Weak Markets Reduce Sales
 Commenting on the quarter, Hale said, "Our March 29 press release indicated we experienced a weak start to the year in key international and domestic markets. Economic conditions in Europe and Japan are depressed, and we are feeling the effects. Orders in our other markets have strengthened in the past four to six weeks. This improvement came late in March and primarily went into backlog, which finished the quarter near a normal level for this time of the year."
 Investments In Product Expansion Depress Mduce a substantial drop in operating profit," Hale said. "Gross margin declined several percentage points from an unusually high level in the first quarter of last year. The primary cause of the decline was temporarily higher costs related to updating and expanding our industrial equipment line. During the past six months we have introduced replacements for our medium and large sweeper models and additional introductions are in process. Selling and administrative expenses were up 5 percent in the quarter, primarily due to our efforts to accelerate penetration of the commercial equipment and floor coatings markets."
 1993 Outlook: Earnings to Continue Under Pressure
 Discussing the outlook, Hale said, "Our second quarter earnings will likely be down somewhat from last year's restated $3.0 million, or 64 cents, before extraordinary gain. This will be due to economic conditions in Europe and Japan, and continuation of above normal costs on recently introduced products.
 "We anticipate getting the new-products transition substantially behind us and improving the margin on these products within the next six months, and we will restrain the growth in expenses. The results of these actions will position us for a strong finish to the year, provided that international economic conditions begin to improve before year-end and the North American economy continues to grow.
 "Under these economic assumptions, about which we have some concerns at this time, an increase in full-year profit before income taxes is possible. However, an increase in after-tax earnings, excluding extraordinary gain and cumulative effect of accounting change, is unlikely due to 1992's unusually low income tax rate," Hale concluded.
 TENNANT COMPANY AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS
 (Unaudited)
 (In thousands, except per share data)
 EARNINGS Three Months Ended
 3/31/93 3/31/92 Pct.
 Change
 Net sales $47,045 $48,803 (4)
 Less:
 Cost of sales 27,394 27,197 1
 Selling and administrative expenses 19,461 18,607 5
 Profit from operations 190 2,999 (94)
 Other income 527 582 (9)
 Profit before income taxes,
 extraordinary gain and cumulative
 effect of accounting change 717 3,581 (80)
 Income tax expense 218 1,228 (82)
 Earnings before extraordinary gain and
 cumulative effect of accounting change 499 2,353 (79)
 Cumulative effect of accounting change
 (net of income taxes of $2,558) -- (4,356) --
 Neg?s $499 $(2,003) --
 Percent of net sales 1.1 ? (4.1) --
 PER SHARE
 Earnings before extraordinary gain
 and cumulative effect of accounting
 change $.10 $.48 --
 Cumulative effect of accounting change -- $(.89) --
 Net earnings $.10 $(.41) --
 Dividends paid $.32 $.30 --
 Average number of shares 4,933,000 4,916,000 --
 -0- 4/15/93
 /CONTACT: Richard Snyder, treasurer of Tennant, 612-540-1208
 (TANT)


CO: Tennant Company ST: Minnesota IN: CST SU: ERN

AL -- MN010 -- 6283 04/15/93 12:55 EDT
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Date:Apr 15, 1993
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