UTILX Reports Profitable Quarter and Substantial Turnaround in First Half

Business Wire, Nov 1, 1999

KENT, Wash.--(BUSINESS WIRE)--Nov. 1, 1999--

UTILX Corporation (Nasdaq:UTLX) announced that for the three months ended September 30, 1999, the second quarter of its fiscal year, consolidated revenues were $24.9 million, compared to $18.9 million in the same period of the prior year. Net income was $306,000, or $.04 per share, which compares to a net loss of $1.91 million, or $0.26 per share, in the same period of the prior year. For the six months ended September 30, 1999, revenues were $48.3 million and net income was $869,000, or $.11 per share, compared to revenues of $40.9 million and a net loss of $1.89 million, or $0.25 per share, in the same period of the prior year.

"We are particularly pleased that we were able to show positive results despite the impact of several hurricanes in August and September which affected our operations in the Southeast," said William Weisfield, President and CEO. "These storms caused a deferral of revenue which had a negative impact on our labor productivity and our margins. However, as a result of our recent emphasis on geographic diversification and strong performances in other areas, especially the West and Europe, we were able to offset some of the effects of the storms.

I continue to be very positive about the outlook for the Company. Our opportunity to grow the CableCURE(R) business was recently enhanced when the State of Washington authorized utilities under its jurisdiction to capitalize rather than expense our CableCURE(R) services. In addition, we are continuing to diversify our extent of involvement with the electric utility industry by increasing the amount of revenues derived from the fast-growing telecommunications industry."

On Tuesday, November 2, at 7:30 a.m. Pacific Time (10:30 a.m. Eastern Time) the Company will conduct a conference call to review financial results and answer questions. Anyone who would like to participate, please call Debbie Casias at (253) 395-4615.

UTILX Corporation provides critical services for the installation and rejuvenation of aged underground infrastructure with proprietary CableCURE(R) solution in the U.S. and Canada through a network of regional sales and service centers. The Company also provides CableCURE(R) services throughout Europe and Asia.

This release contains forward-looking statements relating to the Company's existing and future products and services and future operating results that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. The words "believe", "expect", "intend", "plan", variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Factors that could affect the Company's actual results include competitive pressures, levels of work received from key customers, weather, regulatory, other matters affecting the utility industry in general, and any matters that could cause sudden changes in customers' demand for the Company's services. The Company's contracts typically allow for cancellation on short notice. Reference is made to the Company's latest Annual Report on Form 10-K filed with the SEC for a more detailed description of such factors. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release or to reflect the occurrence of unanticipated events. -0-

FINANCIAL HIGHLIGHTS
(in thousands, except per share amounts)

                                 Second Quarter       Six Months
                                     Ending              Ending
                                9/30/99    9/30/98   9/30/99  9/30/98

Revenues:
North American                  $23,639    $17,090  $45,441  $37,638
International Operations          1,296      1,795    2,869    3,270
                                  -----      -----    -----    -----
Total Revenues                   24,935     18,885   48,310   40,908
                                 ======     ======   ======   ======

Gross Profit                      3,214        432    6,514    3,009
Operating Expenses                2,720      2,216    5,319    4,634
                                  -----      -----    -----    -----
Operating Income (Loss)             494    (1,783)    1,195  (1,625)
                                    ---    -------    -----  -------

Income (Loss) Before
 Income Taxes                       306    (1,911)      869  (1,887)
Net Income (Loss)                   306    (1,902)      869  (1,887)
Basic Earnings Per Share            .04      (.26)      .12    (.25)
Diluted Shares Earnings
 Per Share                          .04      (.26)      .11    (.25)

Basic Shares Outstanding          7,444      7,422    7,433    7,415
Diluted Shares Outstanding        7,795      7,422    7,784    7,415

                                 As of:
                                9/30/99    3/31/99
                                -------    -------
Cash & Cash Equivalents         $ 1,877    $ 1,580
Accounts Receivable              21,884     16,301
Materials, Supplies
 & Inventories                    6,994      6,941
Other Current Assets                763        724
                                -------    -------
Total Current Assets             31,518     25,546
Property, Plant
 & Equipment                     11,421     12,678
Other Assets                        353        351
                               --------    -------
Total Assets                    $43,292    $38,575
                                =======    =======

Note Payable to Bank            $ 7,377    $ 5,538
Other Current Liabilities        14,283     11,746
                                 ------     ------
Total Current Liabilities        21,660     17,284
Long Term Liabilities             2,646      3,182
                                 ------     ------
Total Liabilities                24,306     20,466
Stockholders' Equity             18,986     18,109
                                 ------     ------
Total Liabilities &
 Stockholders' Equity           $43,292    $38,575
                                =======    =======
Common Stock Issued
 and Outstanding                  7,448      7,426