Rica Foods, Inc. (Amex: RCF) announced yesterday its net income for its first fiscal quarter of 2001 amounted to $1.4 million, a 34% decrease when compared to same quarter of fiscal 2000. However, revenues were substantially the same, resulting in $33,278,588, a 0.49% increase when compared to same quarter of fiscal 2000. RICA is the parent company of Costa Rica’s largest and most important poultry producers and among the biggest in the Central American Region, Corporacion Pipasa, S.A. (“Pipasa”) and Corporacion As de Oros, S.A. (“As de Oros”), which cover approximately 70% of the local market. Diluted earnings per share decreased from $ 0.24 for the first fiscal quarter of 2000 to $0.11 for the first fiscal quarter of fiscal 2001.

For the first fiscal quarter of 2001, adverse changes of the Costa Rican economy had a negative impact in the results of operations of the Company. Even though variations in inflation and devaluation rates were stable, other factors such as the drop in international price of coffee and bananas, the increase in international oil prices, increases in local interest rates and an overall low investment in Costa Rica resulted in a slow growth of the Costa Rican economy. In response, the Company temporarily lowered sales prices of certain products, increased volume discounts, and there has been a shift in the product mix to lower-priced products, which have all resulted in lower expected sales. In addition to the above, an increase in the prices of raw materials has resulted in a decrease of segment profit margin from 22.27% in fiscal 2000 to 21.60% in fiscal 2001. A decrease in revenues for the broiler and service (restaurant) segments was mainly due to the negative economic impact. Other positive results of operations was an increase in the sales of the by-products segments due to the sales distribution of the newly acquired brand name “Zaragoza,” the animal feed segment which increased its sales mainly of pet foods products, and a increase in sales of commercial eggs in the segment of others.

An increase in operating expenses was due to increases in employee payroll, vehicle fleet leasing costs, and an increase in amortization of acquisition costs of the minority interest of As de Oros, which took place in November 2000. Non-operating expenses increased due to an increase in interest and exchange difference expenses, due to an increase in outstanding debts, in addition to non-recurrent gains in sales of assets during the first quarter of fiscal 2000.

During the first quarter of fiscal 2001, the Company invested $5.22 million in assets, mainly in the production area. During the rest of the fiscal year 2001, the Company plans to restructure its short-term debt to long-term debt and also use proceeds of fundings to cancel short-term debt. Following are the balance sheets as of December 31, 2000 and 1999, and statements of income for the three months ended December 31, 2000 and 1999:

                      RICA FOODS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets

Assets December 31, 2000 September 30, 2000
(Unaudited)
Current assets:
Cash and cash equivalents $6,856,018 $4,256,636
Short-term investments 493,984 86,557
Notes and accounts
receivable, net 13,452,163 11,187,031
Due from related parties 43,320 39,618
Inventories, net 14,322,476 14,307,768
Prepaid expenses 840,894 557,519
Total current assets 36,008,855 30,435,129

Property, plant
and equipment, net 48,006,190 45,425,881
Long-term receivables-trade 445,632 640,222
Long-term investments 4,791,887 3,965,385
Other assets 4,658,268 4,010,364
Cost in excess of net
assets of acquired
business, net 3,439,248 3,705,392
Total assets $97,350,080 $88,182,373

Liabilities and Stockholders’ Equity

Current liabilities:
Accounts payable $18,112,723 $16,161,076
Accrued expenses 4,044,962 3,862,659
Notes payable 16,633,460 12,878,147
Current portion
of long-term debt 5,250,694 5,680,190
Due to stockholders 74,434 76,657
Total current
liabilities 44,116,273 38,658,729

Long-term debt, net
of current portion 24,262,667 21,820,905
Due to stockholders 16,154 16,409
Deferred income
tax liability 2,806,345 2,899,511
Total liabilities 71,201,439 63,395,554

Minority interest 1,336,445 1,336,445

Stockholders’ equity:
Common stock 12,855 12,855
Preferred stock 2,216,072 2,216,072
Additional paid-in
capital 25,760,950 25,760,950
Accumulated other
comprehensive loss (8,722,189) (8,758,737)
Retained earnings 10,815,324 9,388,127
30,083,012 28,619,267
Less:
Due from Calixto
Chaves, C.E.O. (1,277,462) (1,042,101)
Due from Other Stockholders (3,724,960) (3,858,398)
Treasury stock, at cost (268,394) (268,394)
Total stockholders’
equity 24,812,196 23,450,374
Total liabilities
and stockholders’
equity $97,350,080 $88,182,373

RICA FOODS, INC. AND SUBSIDIARIES
Consolidated Statements of Income
For the three months ended December 31, 2000 and 1999
(unaudited)

2000 1999

Sales $33,278,588 $33,116,512
Cost of sales 21,310,666 21,126,466
Gross profit 11,967,922 11,990,046

Operating expenses:
Selling 4,780,146 4,616,200
General and administrative 3,769,099 3,179,586
Amortization of cost in
excess of net assets of
acquired business 266,147 155,386
Total operating expenses 8,815,392 7,951,172

Income from operations 3,152,530 4,038,874

Other expenses (income):
Interest expense 1,100,016 933,665
Interest income (270,188) (178,461)
Foreign exchange losses 581,449 372,559
Miscellaneous, net (30,717) (206,217)
Other expenses, net 1,380,560 921,546
Income before income taxes
and minority interest 1,771,970 3,117,328
Provision for income taxes 281,756 393,397
Income before minority interest 1,490,214 2,723,931
Minority interest 20,467 507,367
Net income 1,469,747 2,216,564
Preferred stock dividends 42,550 60,025
Net income applicable
to common stockholders $1,427,197 $2,156,539

Earnings per share:
Basic earnings per share $0.11 $0.24
Diluted earnings per share $0.11 $0.24

Weighted average number
of common shares outstanding:
Basic 12,854,321 9,133,123
Diluted 12,854,321 9,136,631


This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties or other factors which may cause actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. For more complete information concerning factors that could affect the Company’s results, reference is made to the Company’s registration statements, reports, or other documents filed with the Securities and Exchange Commission.

For more information, contact Rica Foods at (305) 477-1408, or email, mmarenco@ricafoods.com or rpiedra@ricafoods.com.