Harding Lawson Announces Corporate Restructuring and Headquarters Relocation

Business Wire, June 9, 1999

NOVATO, Calif.--(BUSINESS WIRE)--June 9, 1999--

Harding Lawson Associates Group, Inc. (Nasdaq:HRDG) today announced that it has reorganized its operating structure in order to reduce the layers of management involved in corporate and regional functions.

Furthermore, reflecting a shift in strategic focus, the company is closing its office in Mexico and has begun to explore the disposition of its Australia operations. In addition, as part of this restructuring, the corporate headquarters will relocate from Novato to Denver.

The management changes are effective immediately and the corporate relocation is scheduled to take place on or about August 1, 1999. Collectively, the estimated cost of this non-recurring restructuring charge (including the realignment of the company's operating structure and international operations, together with the corporate relocation) is not expected to exceed $4.5 million on a pre-tax basis.

This restructuring charge will have an adverse effect on the company's fourth fiscal quarter and fiscal year that ended on May 31, 1999. Excluding the impact of the non-recurring charge, management believes operating results for the fourth fiscal quarter will be in line with expectations.

Robert L. Costello, Jr., the company's chief executive officer, commented, "Several management changes became effective on June 1, 1999 that are intended to flatten the management organization and reduce administrative costs. Arthur C. 'Sandy' Riese, currently president of the principal operating division, will manage the Central Region and core construction activities.

"Claude Corvino, currently the company's chief operating officer and president of the infrastructure unit, will assume duty as Western Region manager. Ann E. Massey, who joined HLA when ABB Environmental Services was acquired in 1998, will continue in her role as Eastern Region manager.

"Several other changes in the operations and business development functions of the company are well underway and aimed at reducing corporate administrative cost and producing a more streamlined and cost-effective organization.

"Due to a shift in the company's strategic focus toward domestic opportunities in the infrastructure and environmental markets, the company is closing its operation in Mexico City and will be devaluing the net asset value of its operations in Australia and exploring the potential sale of the Australian operations to the company's Australian management group."

"Denver will be a more efficient location for supporting our nationwide offices and accessing the company's clients more conveniently," Costello continued.

"The decision to relocate the corporate offices was driven initially by the expiration of the long-term lease at its Novato location and the availability of space in the Denver office. Although information systems and government compliance functions will remain in the San Francisco Bay Area, all other corporate functions will be moved and restructured to reduce overall corporate costs.

"All of these actions are intended to streamline company operations, to put senior management closer to our operations and our clients, and to focus our attention on operating the company in such a way as to increase shareholder value."

Harding Lawson Associates Group, Inc., founded in 1957, provides a broad range of environmental and infrastructure engineering, consulting and construction services to industrial and public sector clients.

Certain of the statements contained in this news release are forwarding-looking statements that involve risks and uncertainties, such as those related to the company's contracts and other business risks, including government spending and general economic conditions, industry-wide factors, and the company's ability to realize the cost efficiencies that it expects from certain management and operational restructuring that it is implementing.