Morrow Announces 1996 Second Quarter Financials
(August 6, 1996)

Net sales for the quarter were $2,038,000, compared to $2,034,000 in the prior year's second quarter. The net loss for the latest quarter was $474,000, compared with a loss of $417,000 in the second quarter last year.

The loss per share for the 1996 second quarter was 8 cents, compared with a loss of 11 cents in the 1995 second quarter. The weighted average shares outstanding in the 1996 second quarter were 5,688,000, compared with 3,418,000 in the comparable period a year ago.

For the first six months of 1996, net sales were $2,685,000, compared with $4,751,000 in the first half of 1995. The net loss for the first half of the current year was $1,371,000, or 24 cents per share, compared with a net loss of $899,000 in the comparable period a year ago.

"These results are in line with our expectations for a good year of profitability and growth," commented Dennis Shelton, president of  Morrow Snowboards. "During the quarter we continued to build snowboards for shipment in the second half of the year to meet our orders, which were up significantly over 1995. Our sales for the quarter were equal to last year, despite the fact that we have de-emphasized the manufacture of original equipment (OEM) boards and bindings for other snowboard companies. This year's second quarter sales came primarily from shipments of Morrow-brand equipment to international customers.

"Our costs in the quarter were in line with our plans," Shelton added. "With a solid capital position, expenses on track and good pre-season orders, we remain excited about the prospects for the rest of 1996."

This press release contains forward-looking statements which are made pursuant to the safe harbor provisions of the Private Securities Litigation Act of 1995. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements, including, without limitation, new initiatives by competitors, Morrow's ability to manufacture product at planned costs, and weather in primary skiing areas of the world. The forward-looking statements should be considered in light of these risks and uncertainties.

Morrow Snowboards is a leading designer, manufacturer and marketer of premium snowboards and related products.

Morrow Snowboards Inc.

Income Statement

(000, except per share data)

Quarter Ended Six Months Ended

     6/30/96 6/30/95 6/30/96 6/30/95

Net sales

     $2,038  $2,034  $2,685  $4,751

Cost of goods sold

      1,387   1,409   1,935   3,597

Gross profit

        651     625     750   1,154

Selling, marketing and customer service expense

        721     535   1,614   1,209

Engineering, research and development expense

        186     174     365     335

General and administrative expense

        587     398   1,191     738

Total operating expenses

      1,494   1,107   3,170   2,282

Operating loss

       (843)   (482) (2,420) (1,128)

Other income (expense):

Interest expense

        (38)   (222)   (120)   (366)

Interest income

        107       4     315       4

Other income

         15      16      15      16

Total other income (expense)

         84    (202)    210    (346)

Loss before income tax

       (759)   (684) (2,210) (1,474)

Income tax benefit

        285     267     839     575

Net loss

       (474)   (417) (1,371)   (899)

Net loss per share

      ($.08)  ($.11)  ($.24)  ($.25)

Average shares outstanding

      5,688   3,418   5,653   3,536

Morrow Snowboards Inc.

Balance Sheet (000) 6/30/96 12/31/95

(unaudited)

Cash and cash equivalents $4,544 $15,026

Accounts receivable 2,302 5,886

Inventories 10,408 2,747

Prepaid expenses 534 252

Deferred income taxes 1,759 289

Total current assets 19,547 24,200

Property, plant and equipment - net 8,188 6,936

Other assets 34 43

Total assets $27,769 $31,179

Accounts payable $ 1,739 $ 1,857

Accrued liabilities 585 964

Current portion of long-term debt

and capital lease obligations 286 2,657

Total current liabilities 2,610 5,478

Capital lease obligations, less

current portion 357 475

Deferred income taxes 76 76

Total long-term liabilities 433 551

Common stock 26,332 25,385

Notes receivable for common stock (94) (94)

Accumulated deficit (1,512) (141)

Total stockholders' equity 24,726 25,150

Total liabilities and equity $27,769 $31,179