Milberg Weiss Announces The Filing Of A Class Action Suit Against Key Energy Services, Inc. On Behalf of Investors

Business Wire, June 11, 2004

Business Editors & Legal Writers

NEW YORK--(BUSINESS WIRE)--June 11, 2004

The law firm of Milberg Weiss Bershad & Schulman LLP announces that a class action lawsuit was filed on June 10, 2004 on behalf of purchasers of the securities of Key Energy Services, Inc. ("Key" or the "Company") (NYSE: KEG) between April 29, 2003 and June 4, 2004, inclusive, (the "Class Period"), seeking to pursue remedies under the Securities Exchange Act of 1934 (the "Exchange Act"). A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss's website at: http://www.milbergweiss.com

The action, numbered EP04-CA-0227, is pending in the United States District Court for the Western District of Texas against defendants Key and Key directors and/or officers Richard J. Alario, James J. Byerlotzer, Francis D. John and Royce Mitchell.

The complaint alleges that during the Class Period, defendants' publicly disseminated results of Key's operations and financial condition contained artificially inflated revenues, assets and income. Such results were not prepared or reported in accordance with Generally Accepted Accounting Principles and deceived investors as to the Company's true performance, thereby artificially inflating the price of Key securities during the Class Period. The truth began to emerge on March 15, 2004. On that date, the Company announced that that it would not meet the Securities and Exchange Commission deadline for filing its annual report because it had yet to complete its review of "certain idle equipment" with a book value of $55 million, and that the review might result in "a revision to the 2003 earnings." The Company maintained, however, that, "the underlying fundamentals of the Company are strong and the outlook remains positive." The next two months were punctuated by a series of additional disclosures, each of which further depressed Key's stock price. The Class period ends on June 4, 2004. The morning of the next trading day, June 7, 2004, before the market opened, defendants announced that they were "withdrawing all previous earnings forecasts of operating results for 2004," that they were doing so "in light of current uncertainties affecting the Company," and that they had received notice from the indenture trustee of its 6.375% and 8.375% senior Notes that the Company was in default and had 90 days to cure the default. On this news, the price of Key shares plummeted on extremely high trading volume of 13,963,900 shares. Key shares had closed at $9.62 on June 4, 2004. On June 7, 2004 they reached an intra-day low of $7.00, down 27%, before rebounding to close the day at $8.67.

If you bought the securities of Key Energy between April 29, 2003 and June 4, 2004, and sustained damages, you may, no later than August 10, 2004, request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Milberg Weiss Bershad & Schulman LLP, or other counsel of your choice, to serve as your counsel in this action.

Milberg Weiss Bershad & Schulman LLP (http://www.milbergweiss.com) is a firm with over 100 lawyers with offices in New York City, Los Angeles, Boca Raton, Delaware, Seattle and Washington, D.C. and is active in major litigations pending in federal and state courts throughout the United States. Milberg Weiss has taken a leading role in many important actions on behalf of defrauded investors, consumers, and others for nearly 40 years. Please contact the Milberg Weiss website for more information about the firm. If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following attorneys:

Steven G. Schulman

Peter E. Seidman

Andrei V. Rado

One Pennsylvania Plaza, 49th fl.

New York, NY, 10119-0165

Phone number: (800) 320-5081

Email: sfeerick@milbergweiss.com

Website: http://www.milbergweiss.com