RNHDA Reinhold Industries CL A (MM)

SANTA FE SPRINGS, Calif., Nov. 14 /PRNewswire-FirstCall/ -- Reinhold Industries, Inc. (NASDAQ:RNHDA) of Santa Fe Springs, California, today announced results for the third quarter 2005. Comparative 2004 results are presented to reflect the Samuel Bingham Enterprises, Inc. ("Bingham") and NP Aerospace Ltd. ("NPA") subsidiaries separately from continuing operations. Bingham was sold in December 2004 and NPA is currently held for sale. Third quarter 2005 revenues from continuing operations were $8.3 million, up $0.6 million (7%) from third quarter 2004. Sales in the Aerospace business unit increased by $0.4 million due to additional shipments of rocket nozzles. Sales for the CompositAir business unit increased by $0.2 million due to additional shipments of aircraft seatback components. Sales in the Commercial business unit were essentially flat. In the first nine months of 2005, revenues from continuing operations were $23.0 million, up $0.7 million (3%) compared to 2004. Sales in the Aerospace business unit were flat at $16.3 million. Sales in the CompositAir business unit increased by $0.5 million (14%) to $4.1 million due to changes in product mix. Sales in the Commercial business unit increased by $0.2 million (7%) to $2.6 million due mainly to higher selling prices. Income from continuing operations before income taxes for the first nine months of 2005 was $2.7 million, down $0.6 million (18%) compared to 2004 due to increased compensation costs and higher audit and tax compliance fees. The effective tax rate for the first nine months of 2005 was 121% compared to 40% in 2004 due to the impact of repatriated foreign income. In determining the effective tax rate on income from continuing operations for the nine months ended September 30, 2005, the Company has recorded federal income taxes on approximately $6.4 million of repatriated income from NP Aerospace Ltd. Foreign tax credits are normally available to offset the federal tax liability associated with repatriated foreign income. However, due to limitations in recognizing the remaining tax benefit of our net operating loss carryforwards, we were unable to recognize these foreign tax credits in determining our effective tax rate. We expect to realize the benefit of these foreign tax credits in a future period. Net income for the first nine months of 2005 was $4.2 million, or $1.26 per diluted share, compared to net income of $0.7 million, or $0.23 per diluted share in 2004. The Company also announced today that it will pay a quarterly dividend of $0.50 per share on December 16, 2005 to shareholders of record as of December 2, 2005. "The previously announced sale of NP Aerospace to The Carlyle Group is progressing as expected," said Michael T. Furry, President and CEO of Reinhold. "Pending approval by our shareholders on November 17, 2005, we expect closing to occur shortly thereafter." This news release contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties, and Reinhold's actual experience may differ materially from that anticipated in such statements. Factors that might cause such a difference include those discussed in Reinhold's filings with the Securities and Exchange Commission, including but not limited to its most recent proxy statement, Form 10-K and Form 10-Q. Reinhold Industries, Inc. is a manufacturer of advanced custom composite components and sheet molding compounds for a variety of applications in the United States and Europe. Reinhold Industries, Inc. (NASDAQ:RNHDA) (Amounts in Thousands, Except Per Share Data) (Unaudited) Three Months Ended Nine Months Ended 09/30/05 09/30/04 09/30/05 09/30/04 Sales $8,297 $7,744 $22,974 $22,279 Income from continuing operations before income taxes 960 1,351 2,684 3,265 Income (loss) from continuing operations ($451) $828 ($ 557) $1,964 Income (loss) from discontinued operations $1,174 ($2,999) $4,713 ($1,270) Net income (loss) $ 723 ($2,171) $4,156 $694 Diluted EPS - continuing operations ($0.14) $0.26 ($0.17) $0.64 Diluted EPS $0.22 ($0.71) $1.26 $0.23 DATASOURCE: Reinhold Industries, Inc. CONTACT: Wanda Morrison of Reinhold Industries, Inc., +1-562-944-3281

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