News Release

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 Thursday, November 2, 2000
RWP
CDNX and WSE
6,964,898
$0.25 (2000-11-01)
Henry De Ruiter
President & CEO

RW Packaging Ltd. - 2000, 3rd Quarter Results

Mr. Henry A. De Ruiter reports financial results for the three and nine months ended September 30, 2000, were as follows:

Commenting on the company's results, Henry A. De Ruiter, President and CEO, said, "We're very pleased with the continued sales growth we are generating in our market segments and the significant improvements we're making to our operations to increase our future competitiveness and growth!"

Sales growth for the year gained further momentum during the three months ended September 30, 2000, increasing 26.2% to $2,570,348 versus $2,037,238 for the same period in 1999, exceeding the 23.1% sales increase in Q2 and 8.5% sales increase posted in Q1 of this year. This also marked the eighth consecutive comparable quarterly increase in revenues. Sales continued their growth in all but one of four product divisions. For the quarter ended September 30, 2000 Canadian sales grew 5.2%, while sales to the U.S. more than doubled, growing 183.7%.

Year-to-date sales for the nine months ended September 30, 2000 increased 18.7% to $9,103,273 versus $7,668,107 in 1999. Domestic sales for the nine months ended September 30 increased 7.9%, while sales to the U.S. grew 41.4%. U.S. denominated sales for the nine months ended September 30, 2000 now represent 38.4% of total revenue compared to 32.2% for the same period in 1999, an increase of 6.2 percentage points.

Earnings before Interest, Taxes, Depreciation and Amortization (EBITDA) for the three months ended September 30, 2000 were $105,454 or $0.015 per share (6,964,898 shares outstanding) compared to $90,484 or $0.017 per share (5,464,065 shares outstanding) in 1999, an increase of 16.5%.

The Company recorded a Net Profit of $10,093 or $0.001 per share (6,964,898 shares outstanding) for the three months ended September 30, 2000 compared to a profit of $4,136 or $0.001 per share (5,464,065 shares outstanding) for the comparable period in 1999, an increase of 144.0%. For the nine months year-to-date the Company had a Net Profit of $5,992 or $0.001 per share compared to a profit of $253,476 or $0.046 per share in 1999.

On a year-to-date basis, gross margin when compared to 1999 has declined 5.19 percentage points, however, management expects this figure to be much less at year-end. Despite a sharp increase in raw material input costs experienced at the beginning of this year, driven by surging crude oil costs, the Company has seen a steady improvement in margins through each quarter. Gross margin for the third quarter compared to Q2 improved 3.52 percentage points and 5.48 percentage points when compared to Q1. Management expects that during the last quarter of 2000 margins will return to typical levels as price increases announced to offset increased costs will have all taken effect.

Operating expenses declined 3.5% in Q3 compared to the second quarter of 2000, and 6.8% compared to Q1. Comparing the third quarter to the same period a year ago, operating expenses were 1.2% higher. For the year to date, operating expenses are 6.5% higher than a year ago, however, management expects Q4 expenses to be well below 1999 levels and that by year-end operating expenses will be level with 1999. Operating expenses as a percentage of sales for the quarter ended September 30, 2000 were 4.6 percentage points lower than the same quarter in 1999. For the year to date, operating expenses as a percentage of sales have declined 1.9 percentage points compared to 1999.

For the nine months ended September 30, 2000 the Company has made a total of $608,523 in capital expenditures as follows:

The Company invested $178,249 in the purchase of 2.18 acres of land as well as $318,788 in related construction costs to date for the building of its new head office and manufacturing facility that is to be completed in the middle of November 2000. The Company expects to be fully relocated to the new building from its existing leased premises before year-end. The new facility will generate direct operating expense savings in excess of $150,000 per annum starting January 31, 2001 when our current building's lease obligations expire.

The Company spent $111,484 on equipment and various improvements to operations.

During the third quarter the Company paid $86,325 in Goodwill to OSG Company associated with the acquisition of several product brands previously announced. The Company has chosen to depreciate this over a three-year period commencing from the acquisition date, and during the period ended September 30, 2000 $4,797 was charged to the accounts.

Interest expenses for the third quarter were 27.2% higher than the same period a year ago. Interest expenses were 39.2% higher for the first nine months of 2000 compared to 1999 ($140,594 versus $101,000). The higher interest costs are a result of increased long-term debt the company has used to upgrade its operations and higher use of our credit facilities. Interest costs are expected to be higher this year than in 1999 as the Company chose to use debt financing to finance capital expenditures versus equity financing, so as to negate any dilution to shareholders.

Depreciation was 4.1% lower for the nine months ended September 30, 2000 to $144,479 from $150,616 the previous year. Depreciation for the full year of 2000 is expected to be approximately 16% above 1999, reflecting the purchase of new equipment now in operation.

Book value per share as of September 30, 2000 increased 71.5% to $0.379 per share from $0.221 per share at September 30, 1999.

RW is ISO 9001 registered. The Company blends and packages Liquid and Powder, Private Brand consumer products for Major Retailers and National Brand Marketers across North America.

For further information, please call Mr. Henry De Ruiter, President and CEO, RW Packaging Ltd., toll free at 1-800-284-6338. E-mail inquiries may be sent to rwp@rwpackaging.com, or visit our Web site, www.rwpackaging.com.


RW Packaging Ltd. Statement of Operations and Retained Earnings (Three Months Ended September 30, 2000)


30/09/00
30/09/99       % Change

Revenue
    $    
2,570,348
    $    
2,037,238
26.2%

Manufacturing & Operating Costs
2,464,894

1,946,754
26.6%

EBITDA
105,454

90,484
16.5%

Depriciation
49,380

50,206
(1.6%)

EBIT
56,074

40,278
39.2%

Bank Charges and Interest		 45,981
36,142 27.2%

Operating income
10,093

4,136
144.0%

Provision for Income Taxes
-

-

Net income
    $    
10,093
    $    
4,136
144.0%

EBITDA per Share
    $    
0.015
    $    
0.017
Basic Net Income per Share     $     0.001     $     0.001


RW Packaging Ltd. Statement of Operations and Retained Earnings (Nine Months Ended September 30, 2000)


30/09/00
30/09/99       % Change

Revenue
    $    
9,103,273
    $    
7,668,107
18.7%

Manufacturing & Operating Costs
8,812,208

7,167,339
22.9%

EBITDA
291,065

500,768
(41.9%)

Depriciation
144,479

150,616
(4.1%)

EBIT
146,586

350,152
(58.1%)

Bank Charges and Interest		 140,594
101,000 39.2%

Operating income
5,992

249,152
(97.6%)

Extra-Ordinary Income
-

4,324

Provision for Income Taxes
-

-

Net income
    $    
5,992
    $    
253,476
(97.6%)

EBITDA per Share
    $    
0.042
    $    
0.091
Operating Income per Share     $     0.001     $     0.046
Basic Net Income per Share     $     0.001     $     0.046
Fully Diluted Net Income per Share     $     0.001     $     0.030

Book Value per Share
    $    
0.379
    $    
0.221
71.5%
Total Shares Outstanding
6,964,898
5,464,065


RW Packaging Ltd. Balance Sheet (Nine Months Ended September 30, 2000)

ASSETS 30/09/00
30/09/99       % Change

Current Assets
2,791,443

2,446,217
14.1%
Capital Assets 2,636,146
1,809,561 50.2%
Goodwill 81,528
-
Other Assets 1,033,425
37,665


    $    
6,542,542
    $    
4,293,443
52.4%

LIABILITIES

Current Liabilities
2,523,190

2,129,197
18.5%
Long-Term Liabilities 1,377,633
956,000 44.1%


3,900,823

3,085,197
26.4%

SHAREHOLDERS' EQUITY

Share capital
1,264,103

954,770
32.4%
Surplus 1,371,624
-
Net Profit 5,992
253,476


2,641,719

1,208,246
118.6%


    $    
6,542,542
    $    
4,293,443

The Canadian Venture Exchange and The Winnipeg Stock Exchange have not reviewed, and do not accept responsibility for, the adequacy or accuracy of this release.