THIEF RIVER FALLS, Minn.--(BUSINESS WIRE)--May 13, 1999-- Arctic Cat Inc. (Nasdaq: ACAT - news) today reported results for the fourth quarter and year ended March 31, 1999.

For the 1999 fiscal year net sales were $480,348,000 compared to $504,206,000 last fiscal year. Net earnings were $23,115,000, or $0.84 per diluted share, for fiscal 1999 compared to $25,449,000, or $0.88 on a diluted basis, for fiscal 1998.

Net sales for the fourth quarter ended March 31,1999 increased 8 percent to $88,565,000 from $82,085,000 for the same period last year. A net loss of $1,731,000, or $0.06 per diluted share, was reported for the fourth quarter compared with a net loss of $1,520,000, or $0.05 on a diluted basis, for the fourth quarter of fiscal 1998.

``During the year, we continued to see dramatic growth in sales of our ''best-in-class`` ATV's with retail sales doubling. Arctic Cat's model line now covers all segments of the ATV market and with exciting new products to be announced in June, we expect to again outpace the industry growth this year,'' said Chris Twomey, Arctic Cat president and CEO.

Continuing, Twomey said ``After two years of poor snow and warmer than normal weather, industry-wide snowmobile retail sales again decreased. This is only the second time since 1991, and the third time in 15 years, that the industry has experienced a sales decline. Despite the challenging year, our dealers and consumers were excited with our 2000 model year snowmobile lineup which we unveiled in February and March. Because of the snow conditions, our dealers have responded by ordering more conservatively for the upcoming model year.

``With the personal watercraft retail sales season just beginning, our dealer inventories are at historically low levels which we believe is appropriate given the present market situation. We expect a good retail sell-through this year and anticipate increased orders from our dealers during the 2000 fiscal year.

``Growth of ATV and personal watercraft sales should offset the anticipated decline in snowmobile sales, and as a result, we expect overall revenues to be similar to fiscal 1999.

``We will continue to work aggressively on implementing operating improvements, reducing product and operating costs while reducing inventories. In fiscal 1999 we reduced operating expenses by nearly $8 million and reduced inventories by almost $20 million. These improvements are in part responsible for the significant improvement in our cash position during the year. We expect to continue to use our balance sheet to aggressively support our undervalued stock as well as to look at acquisition opportunities in the leisure recreation industry.''

Arctic Cat Inc. designs, engineers, manufactures and markets snowmobiles and all-terrain vehicles (ATVs) under the Arctic Cat® brand name, and personal watercraft under the Tigershark® brand name, as well as related parts, garments and accessories. To learn more about Arctic Cat, visit the Company's website at http://www.arctic-cat.com.

                            ARCTIC CAT INC.
                         Financial Highlights

               (000s omitted, except per share amounts)

                         Three Months Ended            Year Ended
                            March 31,                   March 31,

                         1999        1998          1999        1998
                         ----        ----          ----        ----
Net Sales              $88,565     $82,085       $480,348   $504,206

Cost of Goods Sold      72,092      64,330        357,137    368,688
                      --------    --------      ---------    --------

Gross Profit            16,473      17,755        123,211    135,518

Selling, General and
 Administrative
  Expenses              20,331      20,842         90,280     97,840
                      --------    --------      ---------    --------

Operating Profit
 (Loss)                 (3,858)     (3,087)        32,931     37,678
Other Income (Expense):

   Interest Income       1,174         730          2,933      1,837
   Interest Expense        -            -             (27)       (59)
                      --------    --------      ---------    --------
                         1,174         730          2,906      1,778

Earnings (Loss)
 Before Income Taxes    (2,684)     (2,357)        35,837     39,456


Income Tax (Benefit)      (953)       (837)        12,722     14,007
                      ---------   ---------     ---------    --------

Net Earnings (Loss)    $(1,731)    $(1,520)       $23,115    $25,449
                      =========   =========     =========    ========

Net Earnings (Loss) Per Share
   Basic                $(0.06)     $(0.05)         $0.84      $0.88
                      =========   =========     =========    ========
   Diluted              $(0.06)     $(0.05)         $0.84      $0.88
                      =========   =========     =========    ========
Weighted Average Shares
 Outstanding
   Basic                27,065      28,595         27,632     28,974
                      ========    ========      =========    ========
   Diluted              27,065      28,595         27,668     29,059
                      ========    ========      =========    ========

Forward Looking Statements

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for certain forward-looking statements. This press release contains forward-looking statements that reflect the Company's current views with respect to future events and financial performance. These forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated depending on a variety of factors, including, but not limited to: product mix; competitive pressure on sales and pricing; increase in material or production cost which cannot be recouped in product pricing; changes in the sourcing of engines; warranty expenses; foreign currency exchange rate fluctuations; product liability claims and other legal proceedings in excess of insured amounts; environmental and product safety regulatory activity; effects of the weather; and overall economic conditions and consumer confidence. Further information concerning the Company and its business, including factors that potentially could materially affect the Company's financial results, is contained in the Company's filings with the Securities and Exchange Commission.

Contact: 

     Tim Delmore
     218/681-9868
     or
     Brian James
     Padilla Speer Beardsley Inc.
     612/871-8877