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Letter to the Editor

Sames in Negotiations for Sale of Company; First Quarter Results Fall Below a Year Ago

FRANKLIN PARK, Ill. -- Sames Corporation has announced that its sale process, which began in November 2000, is continuing. The company has received indications of interest from two multi- national companies, and is currently in negotiations with one of these companies, which has made a proposal to acquire Sames at a price that is significantly below the company's current market price. Due to the continuing sale process, Sames has elected to postpone its annual stockholders' meeting until the third quarter.

Net sales were $14.4 million for the first quarter ended March 31, 2001, compared to net sales of $22.6 million reported in the prior year fiscal quarter ended March 31, 2000. Sales for the current quarter would have been approximately $1.0 million higher had sales denominated in French Francs been translated at 2000 foreign exchange rates. For the three months ended March 31, 2001, the company reported an operating loss of $1.1 million compared to $.7 million operating income in the same period of the prior fiscal year.

The loss from continuing operations was $1.5 million or $(.52) per share, in the first quarter of 2001, compared to income of $.2 million, for the fiscal quarter ended March 31, 2000.

The shortfall in net sales and the resulting loss from operations was principally due to lower volume on large automotive installations and the distraction the ongoing sale process has been both to customers and employees. While still high in relation to net sales, selling, general and administrative expenses are beginning to reflect the workforce reductions at Sames S.A., primarily the early retirement program, that was initiated and fully expensed in the fourth quarter of the prior year. Same's cash resources, according to a company press release, on a consolidated basis are presently not adequate for the company to continue operating in the near short-term. "The company is exploring various alternatives to alleviate this crisis, including seeking short-term funds from potential bidders for the company, strategic investors, lenders and/or industry partners," continued the statement. "However, the outcome of any such financing is uncertain, and if the company is unable to resolve these problems in a timely manner, the company will no longer be able to operate in the ordinary course of business."

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