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Riviera Tool Reports Record Sales, Improved Profitability for Fiscal 2003 Company Secures Expanded Line of Credit to Support Growth Initiatives GRAND RAPIDS, Mich., Nov. 25 /PRNewswire-FirstCall/ -- Riviera Tool Co. today reported sharply improved sales and earnings for the fourth quarter and fiscal year ended Aug. 31, 2003. The Grand Rapids, Mich. designer and manufacturer of stamping die systems reported net sales rose 229 percent to $11.5 million for the fiscal fourth quarter, compared with net sales of $3.5 million for the fourth quarter of fiscal 2002. The Company attributed the increase to strong orders for European and domestic vehicles, including more than $6 million in new contracts booked during the just-completed quarter. Riviera reported net income of $466,517, or $0.14 per diluted share, for the fourth quarter of fiscal 2003, reversing a loss of $1.0 million, or $0.31 per share, for the same period in fiscal 2002. The Company attributed the improved profitability to new contracts and the success of its new approach to stamping die management, which focuses on reducing development time, controlling costs and improving component quality. For fiscal 2003, Riviera reported record net sales of $34.1 million, an increase of 142 percent over the $14.1 million in net sales for fiscal 2002. The Company ended the year with a backlog of $27 million, an increase of 28.6 percent over fiscal 2002. Riviera reported that net income for the just-completed fiscal year was $900,050, or $0.27 per share, compared with a net loss of $3.0 million, or $0.89 per share, for fiscal 2002. "We are extremely pleased to post such strong sales improvements for the quarter and the year," said Kenneth K. Rieth, president and chief executive officer of Riviera Tool. "Our new approach to stamping die management, in concert with new technology implemented during the year, allowed us to secure new contracts and realize greater operating efficiencies during the just- completed year. "As we enter fiscal 2004, quoting activity remains solid, as does our backlog. We will continue to focus on capturing new orders and maximizing the revenue they generate to ensure a good return for our investors." Riviera also reported that it has secured new credit facility that increases its revolving line of credit from $7.5 million to $10 million. Rieth said Riviera will use the expanded credit facility to support the Company's growth initiatives and provide working capital for its new contracts. For the fourth quarter of fiscal 2003, Riviera reported gross margin improved to 9.7 percent of sales, reflecting higher sales and improved overhead absorption. The Company also reported a sharp reduction of its selling and administrative expenses as a percentage of sales, from 10.6 percent in the fourth quarter of fiscal 2002 to 3.9 percent in the just- completed quarter. For the fiscal year, Riviera reported strong improvement in gross margin, which totaled 9.9 percent of sales. The Company attributed the improvement to the higher sales that, in turn, allowed it to absorb more of its fixed manufacturing overhead. While selling and administrative expense were comparable dollar-wise on a year-over-year basis, higher sales volumes in the just-completed fiscal year allowed Riviera to reduce its S&A expense as a percent of sales from 11.8 percent in fiscal 2002 to 5.0 percent in fiscal 2003. The Company also reduced its long-term debt by $1.3 million during fiscal 2003. "We were pleased to see that the market responded positively to the improvements we made during fiscal 2003," said Peter C. Canepa, chief financial officer for Riviera Tool. "Our operating performance helped attract new investors to Riviera, as evidenced by the 250 percent increase in our stock price and the increase in trading volume. "Our focus will remain on reducing expenses and improving operating efficiencies in the quarters ahead, so that we can continue to build on this momentum and increase shareholder value during the coming years." Riviera noted that the new orders secured during fiscal 2003 reflect a significant expansion in its customer base to include more work for European automakers such as Mercedes Benz and BMW, and their Tier One suppliers. Rieth noted that these "new North American OEMs" have made significant inroads with American consumers and are looking for vehicles to increase their penetration at different market levels. "While the market for die systems is still somewhat soft, we are encouraged by the quoting activity we are seeing -- particularly from once- traditional European automakers," Rieth said. "We are pleased to have broadened our horizons to include substantial new contracts for these new North American OEMs, and look forward to growing with them as they expand their reach in this market." About Riviera Tool Riviera Tool Co. (http://www.rivieratool.com/ ) designs, develops and manufactures large-scale, custom metal stamping die systems used in the high-speed production of sheet metal parts and assemblies for the global automotive industry. A majority of Riviera's sales are to Mercedes Benz, BMW, Nissan, DaimlerChrysler, General Motors Corp., Ford Motor Co. and their Tier One suppliers. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: The statements contained in this news release include certain predictions and projections that may be considered forward-looking statements under securities laws. These statements involve a number of important risks and uncertainties that could cause actual results to differ materially, including but not limited to economic, competitive, governmental and technological. Riviera Tool Company Balance Sheets August 31 ASSETS 2002 2003 Current Assets Cash $2,337,743 $- Accounts receivable 2,899,075 7,010,039 Costs in excess of billings on contracts in process 3,988,346 12,208,666 Inventories 250,569 248,559 Prepaid expenses and other current assets 184,313 294,143 Total current assets 9,660,046 19,761,407 Property, plant and equipment, net 14,471,879 13,046,289 Perishable tooling 548,606 617,722 Other assets 303,060 325,198 Total assets $24,983,591 $33,750,616 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities Current portion of long-term debt $10,354,499 $638,756 Accounts payable 1,694,779 5,020,554 Accrued outsourced contracts payable - 5,903,930 Accrued liabilities 448,171 435,896 Total current liabilities 12,497,449 11,999,136 Long-term debt, net of current portion - 8,400,333 Accrued lease expense 675,735 640,690 Total liabilities 13,173,184 21,040,159 Preferred stock - no par value, $100 mandatory redemption value: Authorized-5,000 shares, Issued and outstanding- no shares - - Preferred stock - no par value, Authorized - 200,000 shares Issued and outstanding - no shares - - Common stockholders' equity Common stock - no par value, Authorized - 9,798,575 shares Issued and outstanding - 3,379,609 shares 15,115,466 15,115,466 Retained deficit (3,305,059) (2,405,009) Total common stockholders' equity 11,810,407 12,710,457 Total liabilities and stockholders' equity $24,983,591 $33,750,616 Riviera Tool Company Statements of Operations Fourth Quarter Ended Year Ended August 31, August 31, 2002 2003 2002 2003 Sales $3,531,952 11,522,210 14,050,133 $34,084,111 Cost of sales 3,976,039 10,401,109 14,680,398 30,707,447 Gross profit (loss) (444,087) 1,121,101 (630,265) 3,376,664 Selling and administrative expenses 374,099 444,652 1,658,849 1,689,192 Income (loss) from operations (818,186) 676,449 (2,289,114) 1,687,472 Other income (expense): Interest expense (166,157) (209,932) (652,905) (779,074) Other - - 726 (8,348) Loss on asset disposals (60,807) - (60,264) - Total other expense, net (226,964) (209,932) (712,443) (787,422) Income (loss) - before income tax benefit (1,045,150) 466,517 (3,001,557) 900,050 Income tax benefit - - - - Net income (loss) available for common shares $(1,045,150) 466,517 (3,001,557) $900,050 Basic and Diluted earnings (loss) per common share $(0.31) $0.14 $(0.89) $0.27 Basic and Diluted common shares outstanding 3,379,609 3,379,609 3,379,609 3,379,609 DATASOURCE: Riviera Tool Company CONTACT: Kenneth K. Rieth, CEO, or Peter C. Canepa, CFO, of Riviera Tool Company, +1-616-698-2100; or Investor inquiries: Brian Edwards, +1-616-233-0500, for Riviera Tool Company Web site: http://www.rivieratool.com/

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