APII Releases 3rd Quarter 2008 Results

Management Focuses on Growth Opportunities for 2009

• Press Release
• Source: Action Products International, Inc.
• On Friday November 14, 2008, 10:05 am EST

ORLANDO, FL--(MARKET WIRE)--Nov 14, 2008 -- APII (NasdaqCM:APII - News) announced today, fiscal 3rd quarter and nine month 2008 results. Sales for the fiscal 3rd quarter increased 3% to $1.73 million. This was the first sales quarterly increase from prior year in over two and one-half years. Sales for the nine month period decreased 9% to $4.07 million. The company's losses increased from prior year, for the nine months, to $3.04 million and for the quarter increased to $1.17 million. The losses were caused by decreased sales and increased selling, general and administrative expenses resulting from prior management's decision to increase headcount without a resulting increase in sales. Gross profit margin decreased in 2008 as a result of the rebalancing of inventory levels with the sell-off of slow moving Inventory being replaced with best selling products. In addition, product development costs increased due to the re-launch of Curiosity Kits(TM) and the new OLOGY(TM) line.

Related Quotes

Symbol	Price	Change
APII.PK	0.06	0.00

{"s" : "apii.pk","k" : "c10,l10,p20,t10","o" : "","j" : ""}

Under new management brought in through the acquisition of BE Overseas, the company has shown a renewed operational focus and within the first 60 days accomplished significant milestones, including:

 
--  A significant reduction in operating costs by reducing product cost
    and eliminating non-productive sales positions
--  A change of culture for the organization to focus on sales and
    marketing
--  Reducing facility costs by consolidating warehouse facilities
--  Repositioning of sales team to be better positioned to take advantage
    of the brands we already own such as Ology(TM), I Made That(TM), Logo
    America(TM) and Jay Jay(TM)
--  Shrink inventory cost by reducing non-performing SKUs and reinvesting
    in top sellers

CEO Neil Swartz commented, "Since coming on board we have been able to accomplish our key short term goals while bringing down operating costs significantly. I am very excited about the assets the company currently owns. Our core capabilities of product development, sourcing and distribution are a vital part of our value chain. Our management team has outlined aggressive growth plans within new channels that include expanded international distribution, mass markets and the educational channel. We are very excited about the future."

As part on a renewed effort to become a stronger household name, Action Toys will launch a redesigned logo and marketing campaign to the trade and to consumers which begins with the launch of their new website www.actiontoycompany.com in December 2008. Distributors and retailers will have access to a specialized B2B portal scheduled to launch in early 2009, where orders can be placed and customized sales and product information will be available to them 24/7.

About Action Products International, Inc.

Action Products International, Inc. is a global manufacturer and distributor of brand-focused consumer products with award winning brands in the educational toys and crafts product segment. Headquartered in Orlando, Florida, the Company's product line includes action figures, play-sets, activity kits and premium wooden toys that emphasize educational fun within the themes of arts and crafts, nature and science. Action Toy Company products are distributed to and sold by more than two thousand retail stores worldwide. For more information about the Action Toy Company, please visit our website at www.apii.com and www.actiontoycompany.com

     Contact:
     ACTION PRODUCTS
     Ken Ninomiya
     VP Business Development
     Email: KNinomiya@APII.com
     Phone 1.407.481.8007