redline says its on track

Redline announced financial results for its fiscal 2004 first quarter ended June 30, 2003. As a development stage Company, Redline reported no revenues for the three-month periods ended June 30, 2003 and June 30, 2002. Since inception, Redline's operations have focused on the design, engineering, development and marketing of its initial product, the 800 Revolt® snowmobile. The Company expects to introduce the 800 Revolt snowmobile in time for the 2003-2004 snowmobile season.

The net loss for the first quarter of fiscal 2004 was $2.3 million, or $.86 per share, versus a net loss of $649,000, or $.46 per share, for the same period last year. The increased net loss for the fiscal 2004 first quarter is due primarily to higher interest expense, higher selling, general and administrative expenses, and increased research and development costs. Interest expense in the first quarter of fiscal 2004 was approximately $1.5 million. Beginning in the current fiscal 2004 second quarter, interest expense going forward is expected to be minimal since substantially all of the Company's long and short term debt has been re-paid with the proceeds generated from the completion in May 2003 of its initial public offering ("IPO").

At June 30, 2003, Redline's cash position was $3.0 million versus cash of $37,300 at March 31, 2003, and the Company had no long-term debt. The increase in cash is due to the completion of the IPO in May 2003. In July 2003, Redline received an additional $1.3 million in net proceeds subsequent to the IPO underwriter's exercise of its over allotment option, bringing the total cash position at July 31, 2003 to approximately $4.1 million.

Mark A. Payne, President and CFO of Redline, commented, "We continue to expect to introduce the 800 Revolt in time for the upcoming snowmobile season. Discussions are also accelerating with companies that have the capabilities to assemble our 800 Revolt snowmobile. We anticipate identifying an assembly partner within the next 60 days. We believe we have a sound business plan and an established and growing dealer network. We have recently started to accept purchase orders from dealers and are very pleased with the level of interest."