Producing exact copies of custom race engine cylinder heads is difficult. Engine builders know that recreating a winning combustion chamber with a hand die grinder is time consuming and doesn't always produce a 100 percent accurate copy.

With racing of all types growing in popularity and the after market street rodders demanding high performance products, the ability to produce custom cylinder heads in quantity is a necessity.

This is the situation encountered by Tom's Auto (Clarksburg, Pennsylvania). Tom's Auto is a full-service race engine shop, building and repairing custom cylinder heads for drag racing, circle track, hot rod an(l street rod cars. Increased customer orders and the schedule demands of racing made it necessary for Tom Hemphill, the shop's owner, to find a way to get more high quality engines "out the door." He needed to find an alternative to hand porting and grinding.

Tom's Auto creates custom race engine cylinder heads and offers a repair service for damaged heads. New heads are prototyped by starting with an existing casting and drastically modifying the combustion chamber shape and the intake/exhaust ports by using a combination of hand shaping and CNC machining. Once the new head design has proven itself on the dyno and has performed well at the track, CNC copies of the head are made. "To be competitive, we need to make around 2,100 hp," Mr. Hemphill says. The CNC copies are machined from a solid block of 6061 aluminum. The CNC has made itpossible for Tom's Auto to create new billet CNC heads that will produce the same horsepower of the proven prototype head design.

At the Performance Racing Industrial Show, Mr. Hemphill saw a demonstration of the "copy and cut" digitizing feature on a Centroid (Howard, Pennsylvania) CNC-equipped Millport Rhino 40B bed mill from Millsite Engineering (Ravenswood, West Virginia). Mr. Hemphill knew it was just what he needed.

"It's cylinder head porting that got me into CNC," he says. "The porting work we were doing was very time consuming. You have eight intake and eight exhaust ports in a head. The closer you can come to making them the same, the more power you can make. And. . . it's real labor intensive doing it by hand. We were getting to the point that we were doing more extensive porting. Originally, we started removing 0.06 inch to 0.1 inch of material. Then we got to the point where we were working on heads that we actually had to remove 0.25 inch of material in some places."

The CNC machine has given Tom's Auto the ability to produce custom race engine cylinder heads that will exactly match a proven head design in horsepower and performance. Through CNC digitizing and machining, customers are assured that they will receive an exact reproduction of a proven head design.

The shop performs both digitizing and machining with the Millport bed mill. The Millport CNC eliminated the need to buy a dedicated digitizing machine, reducing Mr. Hemphill's initial investment and reducing the learning curve with only one system to learn. The digitizing interface is in conversational format and integrates with the rest of the control software.

New business the Centroid CNC machine has brought to Tom's Auto is the ability to do repair work on any brand of high performance cylinder heads. Rather than scrap a favorite cylinder head, a race team can now choose to have the head repaired to the original shape. When an engine blows up, very seldom does the whole head get destroyed.

Mr. Hemphill ordered the Millport CNC machine equipped with the Centroid digitizing package. The Centroid "DP-4 all surface touch probe" is equipped with a standard M3 thread that has allowed Tom's Auto to create its own custom-shaped probe stylus to match the special "lollypop" carbide cutters used in machining the combustion chambers and ports. These lollypop-shaped styli and cutters allow undercut digitizing and machining. The CNC also came with a built-in hard drive for onboard digitized part G-code storage, which eliminates the need for an extra computer to be hooked up to the control, further simplifying the digitizing process.

Mr. Hemphill uses the same probe to locate part positions that he uses for digitizing. He uses the conversational probing cycles to automatically find centers, edges, corners, part zeros and heights. To locate a new head for machining or digitizing, he selects the probing cycles graphically, follows the instructions on the screen, presses the cycle start button and the part location is automatically set. Mr. Hemphill is constantly tearing down and setting up new jobs, so the amount of time it takes to set up a new fixture or vise is an important factor.

Tom's Auto used to send lightening work out of the shop until it acquired the new Rhino 40B CNC bed mill. "It would take about 2 weeks just to get a set of pistons lightened," Mr. Hemphill says. "Now we'll have a set done in 2 days." This is significant--by keeping the work in house, the company is able to reduce the cost, increase the quality and decrease the time it takes. "The piston manufacturers only have four or five forgings for a large range of sizes," Mr. Hemphill says, "so a large diameter piston will have a thick wall that adds weight." He uses Centroid's conversational programming, Intercon, to program the lightening operations. He makes use of Intercon's Teach mode to swing three-point arcs inside the piston so he doesn't have to calculate any arc endpoints. Once he has swung the arc for the one side, he just mirrors the same arc to machine the other side.

The new i Adapt adaptive control software for turning is said to maximize a machine's material removal rate during rough cutting to reduce cycle times and increase tool life. The company has also made enhancements to the milling version of this software.

Maximum material removal rates are more critical than precision and surface finish in roughing cycles. According to the company, the software is said to be an enabling technology for this stage of the machining process to maximize machine efficiency.

The software optimizes the cutting feed rate based on a programmed spindle load. By doing this in real-time, it can compensate for conservative assumptions and process variations to help reduce cycle times. Every part, including the first, is optimized automatically, eliminating the need for manual part program optimization.

The software works with all material types and requires no special programming for interrupted cuts. All adaptive monitoring is programmable through the CNC and is transparent to the operator. In addition to the shorter cycle times resulting from an optimized feed rate, the company says the software can also increase tool life by applying a constant and predictable cutting load.

One of the benefits of an Internet-enabled CNC is the potential to reduce the cost and delay associated with service calls, In many cases a machine may not be down because of a mechanical or hardware failure, but instead it may be a programming or parameterizing problem that causes a machine to stop. Problems of this type can often be addressed remotely. Communicating with the CNC across the Internet, using security protocols to protect against authorized access, offers a readily available way to perform this remote service.

But providing the CNC with an Internet connection opens up new possibilities not just for the CNC supplier's service department, but also for the service department of the company using the machine. Thanks to the Internet access, the CNC can be equipped to send e-mails automatically in response to faults or other control-related events. The CNC can even send text alerts via SMS (Short Message Service) to mobile phones.

CNC technology supplier Siemens (U.S. office in Elk Grove Village, Illinois) has developed software called "@Event" for exactly this purpose. The software links a Siemens Sinumerik control to a commercially available e-mail program such as Microsoft Outlook Express. The control can then send e-mails to various addresses selected by the user in response to specific alarms.

The software runs on Windows NT. For a given CNC alarm, the software searches through a pre-configured list for the receivers associated with that alarm. It then establishes the link to the e-mail server and sends the receivers the appropriate email or SMS message.

E-mail messages can contain file attachments, so a log or trace file indicating operator actions or states preceding the fault can go out with the message. To assist quick troubleshooting, all of the relevant machine data can also be sent as a sort of identity card for the machine tool.

Other options for defining how the e-mail or SMS messages are sent are also available. For example:

* Every alarm can be transmitted as a separate message, or all simultaneous alarms can be grouped into a single message.

* A complete list of alarms can be sent cyclically, at a predefined interval.

* Messages can be sent only when an alarm occurs, or they can be sent in response to every further status change after that alarm.

The user also has the option to decide which alarm sources trigger any message at all.

Associating alarms with distinct receivers can allow all alarm messages relating to the control to be routed directly to a system specialist at a remote location for immediate analysis. Meanwhile, alarm messages that indicate mechanical faults can be sent to a local service technician, perhaps as an SMS message to a mobile phone, while these same messages are also sent via e-mail to a production manager's PC.

Adaptive Process Control profile grinding software, driven by Siemens 840D CNC, automatically compensates for clamping misalignments and eliminates possibility of radial eccentricity and axial runout after setup. It detects when there is no contact between grinding wheel and workpiece flank during axial infeed, and causes higher axial feedrate to kick-in. Software also gives users ability to perform dressable grinding of both tooth flanks, simultaneously.

Gleason Corporation has unveiled a powerful new suite of profile grinding software, all driven by the latest Siemens 840D CNC, for its new-generation Gleason-Pfauter Profile Grinders, including the P 600 G. The new software enables users to make dramatic reductions in non-productive time -a disproportionately large and costly part of overall part processing.

Among the most dramatic benefits to end users is Gleason's new patent-pending software that automatically compensates for clamping misalignments, and eliminates the possibility of both radial eccentricity or axial runout after setup. Traditionally, manual setup can take much longer than the actual machining cycle, as the operator methodically centers the part relative to the table and machine axes. But with the new software, this process can be measured in minutes rather than hours. The software, combined with a special measuring device and the calculating power of the new Siemens SINUMERIK 840D, initially determines the position of the part after clamping, and then compensates for actual eccentric or oblique positioning using the machine's five axes during machining.

With Gleason's new Adaptive Process Control software, users will also be able to make significant savings in actual cycle times, by greatly reducing the cutting of air. Gleason's Adaptive Process Control system can actually detect when there is no contact between the grinding wheel and the workpiece flank during axial infeed, and then a higher axial feedrate kicks in. The higher feedrate is used only when the grinding wheel is engaged. This dynamic adaptation of the axial feedrate to actual part size after distortion ultimately can add up to many minutes of cycle time savings. In addition, fewer dressing cycles per workpiece are required, since the same adaptive calculation is used to optimize the dressing interval. Ultimately, overall machining time is further reduced.

The new software also will give users the ability to perform dressable grinding of both tooth flanks simultaneously - a normal procedure on basic, identical involute profiles - but with the flexibility at the same time to grind special profiles on one of the flanks. This can be a particularly useful feature, for example, in creating a special tooth twist for optimum contact conditions in order to compensate for the enormous loads placed on gears in a growing number of applications.

Gleason Corporation is a world leader in the development, manufacture and sale of gear production machinery and related equipment and services. The Company's products are used by customers in automotive, truck, aircraft, agriculture, construction, power tool and marine industries and by a diverse set of customers serving various industrial equipment markets. Gleason has manufacturing operations in Rochester, New York; Rockford, Illinois; Plymouth, England; Munich and Ludwigsburg, Germany; Bangalore, India; and Biel, Switzerland, and has sales and service offices throughout the North and South America and Europe and in the Asia-Pacific region.

Rohr Industries Inc., Chula Vista, Calif., is expected to put two abrasive water jet machines into production later this year and a third is expected to be installed next year for cutting of titanium, Inconel and Hastalloys up to 3 inches thick in parts for jet engine shrouds.

A computer numerical control (cnc) machine for high production volume parts and a manual system for trimming contoured or uneven parts will be installed, Chuck Holland, project engineer for the Rohr abrasive water jet project, said during a technical seminar at the recent Fabtech conference here.

Most of Holland's remakrs centered on results of tests on the cnc machine in a research laboratory at Rohr. The company is using some of the results observed in those tests to design the third machine for which Holland hopes to secure an outside vendor to build to specification. The third system, he said, will be further automated with automatic loading and unloading.

The test machine was built by Flow Systems Inc. while Ingersoll-Rand Corp. also makes comparable machines (AMM/MN, Dec. 10). The cnc machines has Allen-Bradley 8200 controls. The cost of the machines are about $250,000 each, Holland said.

Rohr has been using standard shearing equipment as well as band saws and other techniques for cutting the titanium, Inconel and Hastalloy materials, Holland said. Laser cutting was considered but Holland said some of the parts in question require that their grains structure not be affected by the heat that a laser would generate.

A Camsco automatic nesting system originally purchased for cutting aluminum parts on a Trumpf router has been adapted for use on both the router and the abrasive water jet. That system uses computer-aided design data to determine how to cut the components to assure maximum material usage, Holland said.

Among the initial problems encountered with the laboratory system was heavy tile wear on the bottom of the water tank. Holland said this happened because the abrasives were hitting the tiles. As a solution, the machine being designed will have a mechanical metal "catcher" that will move under the water jet in synchronous action with the jet stream gantry to catch the abrasives before they hit the water tanks.

Rohr also found that while the cut finish appeared smooth, magnification of the edge showed the cut was not as smooth as needed in some applications. This could result in short fatigue life. The initial study, however, used 60 grit abrasives, the most commonly used type of abrasive for abrasive water jet cutting. By moving to 150 grit, a much finer abrasive, fatigue life was increased by 50 percent on Inconel and doubled on titanium, Holland said.

However, the finer grit gives a slower feed rate than the 60 grit. Holland said the solution is to have a machine that has two hoppers filled with the two types of abrasives. The 150 grit will be used on the parts whose fatigue life is critical and the coarser material will be used where speed is more important.

The abrasive water jet technique is being used for cutting titanium, Inconel and stainless steel up to 3 inches thick and aluminum up to 5.5 inches thick.

Because the machines have not been put into production, Holland said the productivity gains of the technique have not yet been determined. However, he noted that the experience of other companies indicates that production should be several times greater than in current systems.

It will come as no surprise to learn that non-metallic composite components are used increasingly in the manufacture of commercial and military jet engines to reduce engine weight, increase customer payloads, and provide optimum sound suppression. The application of non-metallic materials to jet aircraft engines is relatively new, and there continue to be innovations in the field of composites.

Machining composite materials poses a number of challenges, so there is much to be learned from shops and plants that are now doing it successfully. One of those plants belongs to the General Electric Aircraft Engine (GEAE) group and is located in Albuquerque, New Mexico. One of the most important lessons this plant has learned about machining composites is that every element of the process must be considered carefully. Successful machining of composites requires the right machine, the right fixturing, the right cutting tools, and so on, only the degree of "rightness" required is far higher than typically encountered in most machining applications.

An unusual machine tool installed a few years ago to machine composites provides a case in point. Ultimately, the exact "rightness" of this machine depended on the type of spindle with which it was equipped. With the right spindle, all of the other right choices regarding type of cutting tools and cutting speeds and feeds could be made.

It will come as no surprise to learn that non-metallic composite components are used increasingly in the manufacture of commercial and military jet engines to reduce engine weight, increase customer payloads, and provide optimum sound suppression. The application of non-metallic materials to jet aircraft engines is relatively new, and there continue to be innovations in the field of composites.

Machining composite materials poses a number of challenges, so there is much to be learned from shops and plants that are now doing it successfully. One of those plants belongs to the General Electric Aircraft Engine (GEAE) group and is located in Albuquerque, New Mexico. One of the most important lessons this plant has learned about machining composites is that every element of the process must be considered carefully. Successful machining of composites requires the right machine, the right fixturing, the right cutting tools, and so on, only the degree of "rightness" required is far higher than typically encountered in most machining applications.

An unusual machine tool installed a few years ago to machine composites provides a case in point. Ultimately, the exact "rightness" of this machine depended on the type of spindle with which it was equipped. With the right spindle, all of the other right choices regarding type of cutting tools and cutting speeds and feeds could be made.

The primary reason for the reduced earnings was an increased investment in research and development and marketing plus non-recurring legal expenses.

For the year ended July 31, 1999, the company earned $637,913 on sales of $24,622,322, or 49 cents per share vs. earnings of $1,317,886 on sales of $24,856,975 or 89 cents per share the previous year. Gross profit was $8,459,968 or 38.9 percent of net sales for the year vs. $8,841,623 or 40.5 percent of net sales for the previous year. The primary difference in gross margin was product mix.

Expenses for fiscal 1999 were $7,309,350 vs. $6,413,160 for the previous year. This increase of $896,190 was primarily in three areas, research and development, marketing, and non-recurring legal expenses.

Marketing expenses were part of an effort to increase penetration in the woodworking industry and increase the market size. During the year, the company demonstrated Furniture Fabrication at several trade shows. Furniture Fabrication is where a production cell, based on Thermwood technology, is used to build entire pieces of furniture. Both advertising and trade show expenses increased.

Management believes that these efforts were successful as the level of sales to the woodworking industry increased; however, a lower level of manufacturing activity resulted in lower sales levels to the plastics industry, more than offsetting the increase in woodworking.

Management intends to continue promoting Furniture Fabrication since, if accepted by the industry, it has the potential to increase the market size and demand for Thermwood products.

During the year Thermwood established a Software Technology group to search out and offer software products that enhance the efficiency and operation of its CNC router systems. The company signed distribution agreements with several software companies including a cabinet design software company called Cabinet Vision. Based on that agreement, Thermwood and Cabinet Vision jointly developed an integrated system with which a customer can design and efficiently manufacture custom kitchen cabinets.

Trial versions of this system were shipped after the end of the fiscal year and management believes that, if this effort is successful, it may begin impacting sales and earnings within the first or second quarter of fiscal 2000. Management believes that this product offers a substantial growth opportunity since there are approximately 100,000 custom cabinet manufacturers in the U.S. alone.

In addition to developing the integrated cabinet package, research and development efforts also enhanced the current product line by increasing operating speed, improving cut quality, reducing tool change time, improving spindle life and reducing noise. The company also developed other additions to its product offering, including a new high-speed tool changer, a multi-function machine table, a tool management system and a five-axis chip collection system.

The company's European operations began operating above a break-even for the last half of the fiscal year, however they showed a loss for the year as a whole. Management believes that future prospects for this operation are dependent on economic and manufacturing activity in the European community.

Despite a soft manufacturing market, Thermwood has invested heavily in marketing and product development and believes this investment has positioned the company for improved sales and earnings in the fiscal 2000 and beyond.

Forward-looking statements in this document are made pursuant to the "Safe Harbor" provision of the Private Securities Litigation Act of 1995. Investors are cautioned that actual results may differ substantially from such forward-looking statements. Forward-looking statements involve risks and uncertainties, including but not limited to, continued acceptance of the company's products in the marketplace, acceptance of new products in the marketplace, competitive factors, new products and technological changes, the company's dependence on third party suppliers, overall economic activity and other risks detailed from time to time in certain of the company's filings with the Securities and Exchange Commission.

Ducommun Inc. today announced that its AHF-Ducommun subsidiary has signed a contract with Boeing-Long Beach valued at $49 million to produce fuselage skin panels for the C-17 aircraft.

The contract involves the transition of the production of 96 large aluminum fuselage skin panels for the C-17 aircraft from Boeing's Long Beach facility to AHF's Gardena, Calif. facility. Performance under the contract began in the first quarter of 2000 and is expected to continue through C-17 aircraft number P-120 in 2003.

In addition, AHF-Ducommun has signed an option contract with Boeing-Long Beach for the production of C-17 fuselage skin panels for the period 2003-2007. The option contract, if fully exercised by Boeing, is valued at $62 million. Taken together, the $111 million contract is the largest contract award in Ducommun's history.

In connection with the contract, AHF-Ducommun is acquiring from Boeing two significant pieces of capital equipment: a 1,500-ton stretch press and a 5-axis CNC Torres router with a flexible pogo positioning system. AHF-Ducommun also is in the process of completing a 185,000-square-foot building addition to support the C-17 contract as well as other off-load opportunities from its customers.

Joseph C. Berenato, chairman, president and chief executive officer, stated: "While Ducommun has been a significant supplier to the C-17 program for some time, this contract represents entirely new work for the Company. The aluminum fuselage panels being formed by AHF include some of the largest panels in the aerospace industry.

"The contract also involves AHF-Ducommun's extensive program management capability since the completed fuselage panels we are delivering to Boeing require the integration of services provided by a variety of subcontractors.

"The C-17 contract is further confirmation of the soundness of our strategic direction. Over the past five years, we have invested in some of the largest and most extensive forming capabilities in the aerospace industry. Now, as the prime contractors and major subcontractors seek to reduce their cost structures, I believe Ducommun is well-positioned to capitalize on further significant off-load opportunities from our customers."

Founded in 1849, Ducommun manufactures components and assemblies for the aerospace industry.

The statements made in this news release are forward-looking statements that involve risks and uncertainties. The Company's future financial results could differ materially from those anticipated due to the Company's dependence on conditions in the airline industry, the level of new commercial aircraft orders, the production rate for the Space Shuttle program, the level of defense spending, competitive pricing pressures, technology and product development risks and uncertainties, product performance, risks associated with acquisitions and dispositions of businesses by the Company, increasing consolidation of customers and suppliers in the aerospace industry, availability of raw materials and components from suppliers, and other factors beyond the Company's control.

Built by Millsite Engineering, the SmartLathez is equipped with precision ballscrews; a 10-hp spindle motor; a 3 3/8" spindle bore supported at three points; a dual-handle manual pulse generator; and a quick-change tool post. The bedways are induction-hardened and ground, and the slideways of the saddle and cross slide are lined with Turcite-B.

Also included is the Centroid T400S control, which provides accuracy to 0.00001". The control can be networked, enabling users to connect to a LAN and transfer files. A 15" color monitor and multi-directional sidearm mount is standard, as is conversational software programming. The six-position electric toolchanger carries out multiple operations via the control.

With BobArt Pro-X from BobCAD-CAM, users can convert pictures or CAD drawings into 2D toolpath or embossed models for machining within Version 20 2D and 3D CAD/CAM software. The release is intended to assist manufacturers, including mold makers, in creating the appropriate model and tool path for CNC machining, from imported or designed images and CAD geometry.

Users can automatically convert a color, grayscale or black and white picture into a full relief model, says the company. The appropriate toolpath strategy can then be created on the fly. Added mirroring options are useful for creating negative relief models. In addition to this capability, users can form raster to vector operations to create 2D profile tool paths for carving or profile milling directly from pictures.

Once the toolpath is machined in the CAM sphere of the software, the cutting process can be simulated and verified prior to sending the program to the machine.

Thermwood Corporation announced today that it has established a business-to-business program covering the sale and resharpening of cutting tools. Initially, the program will focus primarily on CNC router tools in the woodworking industry but the company plans to expand the program to encompass other types of cutting tools in other markets.

The major feature of this program is that, once a tool has been purchased from Thermwood's web site, ToolingOnTheWeb.com, resharpening service on that tool is free. Normally, an industrial router bit can be sharpened and reused three or four times before it must be discarded. The cost of sharpening service on a tool can amount to a third or more of the original tool cost. Thus, management believes that a free resharpening service can substantially lower overall tooling cost for a company. Management believes that even companies that purchase tools in large quantity, at a discount, directly from the tool manufacturer can realize a total cost savings by buying the same tools through this program and taking advantage of the free resharpening service.

Thermwood management believes it can provide the free resharpening service and still make a profit on the overall program because of the nature of the tool sharpening process. Commonly, sharpening service is provided by a local tool dealer or tool shop that uses a tool-grinding machine. Different types of tools have different geometry. The tool-grinding machine must be set up for each different tool geometry. The set up process can require five to ten times as long as it takes to actually sharpen the tool. Thus, the major cost of resharpening a tool is not the actual grinding process but the cost of repeatedly setting up the machine for different tools.

To resharpen tools quickly, and at low cost, Thermwood believes that it is necessary to eliminate the set up process. To do this, Thermwood installed a separate tool-grinding machine for each different tool geometry covered by the program. Thus, any tool returned, can be sharpened at low cost without the need for machine set up. Thermwood has initially installed sixteen tool-grinding machines, providing an initial sharpening capacity of approximately 5,000 to 10,000 tools a day.

Thermwood does not intend to manufacture cutting tools, but instead plans to offer tooling from established vendors. Thermwood currently represents tooling provided by seven different tool manufacturing companies and is actively negotiating with others in an effort to add additional products to the offering. The company believes that the major component of the investment required to initiate the program to a level that can achieve profitability has already been made. It does not anticipate additional material expenses to establish the program. The company has filed for a patent on the business practices associated with this program.

Although there are no established or industry accepted estimates for the size of the woodworking router bit tooling market, management believes that the market it is initially targeting amounts to approximately $200 million annually. If successful, the company hopes to expand the program to include different types of tools, targeting different industries.

The `Free Sharpening" service has been posted on the company's web store and management expects an initial "testing' period, where customers make small trial purchases to test the program before making volume purchases. At this point in the program it is not possible to accurately estimate whether or not it will be successful, and if successful, the rate of growth and ultimate market share it may achieve.

Thermwood Corporation is an automation products company that is bringing advanced technology to the manufacturing process. Its line of sophisticated, computer-controlled machines integrate into today's modern computer network environment. They are intended to produce complete products or components, rather than simply performing a single manufacturing process, as is common with most machine tools. This equipment is supported with a variety of software, services and supplies.

Forward-looking statements in this document are made pursuant to the "Safe Harbor" provision of the Private Securities Litigation Act of 1995. Readers are cautioned that the actual results may differ substantially from such forward-looking statements. Forward-looking statements involve risks and uncertainties, including but not limited to, continued acceptance of the Company's products in the marketplace, competitive factors, new products and technological changes, the Company's dependence on third-party suppliers and other risks detailed from time to time in certain of the Company's filings with the Securities and Exchange Commission.

Thermwood Corporation (AMEX:THM) announced results for the third quarter of Fiscal 2000 and the nine-month period both ending April 30, 2000.

For the quarter, earnings were $73,553 or $.08 per share on sales of $7,735,905 versus earnings of $164,268 or $.13 per share on sales of $6,069,630 for the same quarter the previous year. Earnings for the current period were negatively impacted by an increase in interest expense of $152,758 when compared to the same period last year. The primary reason for the higher interest expense was interest costs and bond discount amortization associated with the debt for equity exchange completed April 27, 1999. For the nine month period ended April 30, 2000 earnings were $553,390 or $.56 per share versus earnings of $417,944 or $.30 per share for the same period the previous year. Earnings for the nine-month period in the current year also reflect an increase in interest and bond discount amortization of $478,079; however, a reduction in the number of outstanding shares that resulted from the debt for equity exchange when combined with improved overall earnings resulted in earnings per share increasing for the nine-month period.

During the quarter Thermwood began offering nine new fully engineered systems to the woodworking industry in addition to the two systems it was already offering. These systems allow customers to purchase a complete, integrated package already programmed to build specific end products. This eliminates the need for the customer to select, configure, integrate and program the sophisticated computer equipment. Thermwood management believes that this may make its products more attractive to companies that do not have the technical and engineering resources to perform these functions themselves.

Thermwood launched a new web site design that also contains a business to business web store. This store offers the CNC router supplies and support products that are also offered in the Company's printed catalog. In addition, web store called ToolingOnTheWeb.com was integrated with the Thermwood.com store to provide an industry source for tooling and tooling products. During the next several months the Company plans to broaden the offering and expand the services available from the web store.

Forward-looking statements in this document are made pursuant to the "Safe Harbor" provision of the Private Securities Litigation Act of 1995. Readers are cautioned that the actual results may differ substantially from such forward-looking statements. Forward-looking statements involve risks and uncertainties, including but not limited to, continued acceptance of the Company's products in the marketplace, competitive factors, new products and technological changes, the Company's dependence on third-party suppliers and other risks detailed from time to time in certain of the Company's filings with the Securities and Exchange Commission.