Mark IV Reports Record Third Quarter;
Nine Month Results Takes Extraordinary
Charge for Early Debt Extinguishment

Amherst, New York, Dec. 18, 1997--Mark IV Industries, Inc. (NYSE: IV) today reported record sales and earnings for its third quarter ended November 30, 1997. Income from continuing operations before special items rose eight percent in the quarter, to $27.3 million from $25.2 million last year, while related primary and fully-diluted earnings per share increased 13 and 11 percent respectively, to 43 and 42 cents from 38 cents in both cases last year.

Sales from continuing operations in the third quarter increased eight percent, to $564.1 million from $521.6 million, while related operating income (income from continuing operations before special items, interest expense and taxes) increased nine percent, to $60.8 million from $55.8 million last year.

For the first nine months of fiscal 1998, income from continuing operations before special items, increased 11 percent, to $84.9 million, from $76.7 million last year, while related primary and fully-diluted earnings per share increased 14 and 13 percent respectively, to $1.32 and $1.30 from $1.16 and $1.15 last year. Sales from continuing operations in the nine months increased six percent, to $1.66 billion from $1.56 billion and operating income increased eight percent to $184.9 million from $170.6 million. However, the increasingly strong U.S. dollar continues to have a negative impact, reducing revenues by three percent in the quarter and nine months, while also reducing earnings by $.02 and $.05 per share in the same periods respectively.

Net income in the third quarter was $16.7 million, or 26 cents per share, which includes an extraordinary charge of $10.6 million after taxes, or 16 cents per share, due to early debt extinguishment, as compared to last year's net loss of $28.7 million, or 43 cents per share, which included an after tax restructuring charge of $67.5 million, or $1.01 per share, and net income of $13.6 million, or 20 cents per share from discontinued operations. Net income in the nine months was $74.3 million, or $1.14 per share, which also includes the extraordinary charge of $10.6 million for early debt extinguishment, or 16 cents per share, as compared to last year's net income of $26.6 million, or 40 cents per share, which included a restructuring charge of $67.5 million, or $1.01 per share, and net income of $17.4 million, or 26 cents per share from discontinued operations.

All share-related amounts, except for those identified as primary, are fully-diluted and all share related amounts, both primary and fully diluted, have been adjusted for the five percent stock dividend distributed in May 1997.

During the quarter the company sold $275 million of Convertible Subordinated Notes which mature on November 1, 2004. The Notes bear interest at an annual rate of 4-3/4% and are convertible into Mark IV Common Stock at a price of $32.8125 per share, subject to anti-dilution adjustments. Mark IV used a portion of the net proceeds from this transaction to repurchase approximately $185 million principal amount of its outstanding $258 million 8-3/4% senior subordinated debt and recorded an extraordinary charge during the quarter for early debt extinguishment of $10.6 million after taxes. The remaining $73 million principal amount of these Notes due April 1, 2003, will be called for redemption on April 1, 1998, and will be repaid with the remaining proceeds from the offering. As a result, the company will incur an additional extraordinary charge for early debt extinguishment in the first quarter of its next fiscal (1999) year.

To date the company has repurchased approximately 2.7 million shares of its common stock for an aggregate cost of $63.6 million, part of a 7.3 million share repurchase program authorized earlier in the year. The effects of the repurchase of shares and the issuance of the convertible notes is to increase fully-diluted weighted average shares outstanding one percent in the quarter, to 67.3 million, and to decrease shares outstanding by one percent in the nine months, to 65.8 million.

During fiscal 1997, Mark IV substantially completed a divestiture program allowing the company to refocus on its power transmission, fluid transfer and filtration businesses. Fiscal 1997 results reflect the divested businesses as discontinued operations. Consequently, last year's results have been restated to reflect this treatment.

Commenting on the company's operating performance, Sal H. Alfiero, chairman and chief executive officer of Mark IV, said, "Revenue in the quarter and nine months was up eight percent and six percent respectively. Mark IV's Automotive revenue increased 10 percent in the quarter and eight percent in the first nine months, as compared with last year. Revenue growth for both the quarter and the nine month periods was led by strength in the company's Automotive OEM business and includes $15 million of revenue from recent acquisitions. Revenue growth for Automotive in the quarter and year-to-date excluding these acquisitions, would have been five percent and six percent, respectively. After a strong second quarter, the aftermarket business was disappointing in the third quarter; off slightly during the period, and relatively flat on the year-to-date basis. The Industrial performance in the quarter was led by a strong infrastructure component helping to increase revenues 10 percent in the period on a proforma basis. Year-to-date Industrial revenue grew by six percent without regard to businesses disposed of earlier in the year. This growth is being led by the domestic Industrial business, while the foreign component of the Industrial segment is relatively unchanged from the previous year.

"We are in the midst of our restructuring activities which are proceeding a little slower than the original schedule. While the closing of operations is moving along as scheduled, the relocation and start-up of product lines and distribution activities is slightly behind plan. We are endeavoring to catch up as we close out the fiscal year and expect to see net benefit flow from the restructuring beginning sometime during the first half and accelerating into the second half of next fiscal year which is about in line with our original estimates.

"Also, during the quarter we have completed the acquisition of LPI Systemes Moteurs S.A. for a net cash purchase price of approximately $60 million. This French company manufactures plastic air admission systems which include air intake manifolds and cooling modules produced by injection, welding, and blow molding technologies. LPI is a recognized world leader in these technologies currently generating annual sales of approximately $60 million. The addition of LPI significantly improves Mark IV's competitive position by adding LPI's Air Handling Systems to our fuel and fluid handling capabilities. We have begun to introduce this technology to North America to service the growing requirements of our domestic customer base. The impact in the U.S. of this transfer will be felt in fiscal year 2000."

Mark IV Industries, Inc., is a $2.2 billion global manufacturing company headquartered in the Buffalo suburb of Amherst, New York, employing 16,200 people worldwide. The company's core technologies include power transmission, fluid transfer and filtration systems and components for global industrial and automotive markets.