Alliance Laundry Holdings LLC Reports 2nd Qtr 2005 Earnings

Business Wire, August 11, 2005

RIPON, Wis. -- Alliance Laundry Holdings LLC announced today results for the quarter and six months ended June 30, 2005.

Net revenues for the quarter ended June 30, 2005 increased $12.3 million, or 16.8%, to $85.7 million from $73.4 million for the quarter ended June 30, 2004. Our net loss for the quarter ended June 30, 2005 was $2.7 million as compared to net income of $6.2 million for the quarter ended June 30, 2004. Adjusted EBITDA(i) for the quarter ended June 30, 2005 was $16.6 million compared with Adjusted EBITDA of $16.1 million for the quarter ended June 30, 2004.

The overall net revenue increase of $12.3 million was attributable to higher commercial and consumer laundry revenue of $11.7 million and service parts revenue of $0.6 million. Our net loss for the quarter ended June 30, 2005 included $8.0 million of transaction costs incurred in establishing a new asset backed facility for the sale of equipment notes and trade receivables, and amortization of $0.6 million related to an inventory step-up to fair market value recorded on the acquisition date, with no similar costs in 2004.

Net revenues for the six months ended June 30, 2005 increased $15.9 million, or 11.4%, to $155.6 million from $139.7 million for the six months ended June 30, 2004. Our net loss for the six months ended June 30, 2005 was $34.1 million as compared to net income of $10.4 million for the six months ended June 30, 2004. Adjusted EBITDA(i) for the six months ended June 30, 2005 was $29.2 million as compared with Adjusted EBITDA of $31.2 million for the six months ended June 30, 2004.

In announcing the Company's results today, CEO and President Thomas F. L'Esperance said, "We are extremely pleased with our top line revenue growth of 16.8% for the quarter ended June 30, 2005. Leading the way for the quarter was higher international equipment revenue of $4.4 million, higher North American commercial equipment revenue of $4.1 million and higher consumer laundry revenue of $2.2 million."

"We are very pleased to have the purchase of Alliance by Ontario Teachers and the establishment of our new asset backed facility behind us and look forward to focusing our efforts on growing the business and delevering the Company," said L'Esperance.

Alliance Laundry Holdings LLC is the parent company of Alliance Laundry Systems LLC (www.comlaundry.com), a leading North American manufacturer of commercial laundry products and provider of services for laundromats, multi-housing laundries, on-premise laundries and drycleaners. Alliance offers a full line of washers and dryers for light commercial use as well as large frontloading washers, heavy duty tumbler dryers, and presses and finishing equipment for heavy commercial use. The Company's products are sold under the well known brand names Speed Queen(R), UniMac(R), Huebsch(R) and Ajax(R).

(i) Non-GAAP Financial Measures

In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles (GAAP), we also disclose EBITDA and Adjusted EBITDA, which are non-GAAP measures. We have presented EBITDA and Adjusted EBITDA because certain covenants in the indenture governing our 2005 Senior Subordinated Notes are tied to ratios based on these measures. "EBITDA" represents net income before interest expense, income tax (provision) benefit and depreciation and amortization, and "Adjusted EBITDA" is EBITDA as further adjusted to exclude, among other things, certain non-recurring expenses and other non-recurring non-cash charges. EBITDA and Adjusted EBITDA do not represent, and should not be considered, an alternative to net income or cash flow from operations, as determined by GAAP, and our calculations thereof may not be comparable to similarly entitled measures reported by other companies. Based on our industry and debt financing experience, we believe that EBITDA and Adjusted EBITDA are customarily used to provide useful information regarding a company's ability to service and/or incur indebtedness. In addition, EBITDA and Adjusted EBITDA are defined in the indenture governing our 2005 Senior Subordinated Notes in a manner which is identical to the definition of EBITDA and Adjusted EBITDA in our New Senior Credit Facility under which we are required to satisfy specified financial ratios and tests, including a maximum of total debt to Adjusted EBITDA and a minimum interest coverage ratio. A reconciliation from Net (Loss) Income to EBITDA and from EBITDA to Adjusted EBITDA is provided under the heading Management's Discussion and Analysis of Financial Condition and Results of Operations for the Quarter and Six Months Ended June 30, 2005 of this press release.

Safe Harbor for Forward-Looking Statements

With the exception of the reported actual results, this press release contains predictions, estimates and other forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Act of 1934, as amended. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements of our business to differ materially from those expressed or implied by such forward-looking statements. Although we believe that our plans, intentions and expectations reflected in such forward-looking statements are based on reasonable assumptions, we can give no assurance that such plans, intentions, expectations, objectives or goals will be achieved. Important factors that could cause actual results to differ materially from those included in forward-looking statements include: impact of competition; continued sales to key customers; possible fluctuations in the cost of raw materials and components; possible fluctuations in currency exchange rates, which affect the competitiveness of our products abroad; possible fluctuation in interest rates, which affects our earnings and cash flows; the impact of substantial leverage and debt service on us; possible loss of suppliers; risks related to our asset backed facilities; dependence on key personnel; labor relations; potential liability for environmental, health and safety matters; potential future legal proceedings and litigation; and other risks listed from time to time in the Company's reports, including, but not limited to the Company's most recent Annual Report on Form 10-K for the year ended December 31, 2004.