Coastcast Posts $2.7 mm Q1 Loss as Sales Plunge 51%

Coastcast Corporation reported sales for the first quarter ended March 31, 2003 were $10,731,000 as compared to $21,956,000 for the same period in 2002, net (loss) income was ($2,736,000) vs. $723,000, and diluted (loss) earnings per share were ($0.36) vs $0.09.

Hans Buehler, Chairman and CEO, stated: “We are now in the process of ramping up our production and are finding that the massive downsizing of the prior years impacted our present quality and efficiencies. We are working diligently to get these issues under control and reduce our current losses. We still anticipate profits as our volume increases this year.”

                         Coastcast Corporation
                   Financial Highlights - Quarterly
                    ($ in 000s, except shares data)

Statements of Operations Summary (Unaudited)
                                                    Q103      Q102
                                                  -------    -------
Sales                                             $10,731    $21,956
Cost of sales                                      12,049     19,064
Gross (loss) profit                                (1,318)     2,892
Selling, general & administrative expense           1,250      1,603
Impairment of fixed assets                             55         --
(Loss) income from operations                      (2,623)     1,289
Other income, net                                      17         34
(Loss) income before provision for income taxes    (2,606)     1,323
Provision for income taxes                            130        600
Net (loss) income                                 $(2,736)      $723