FARNHAM, QUEBEC--The Board of Directors of Domco Tarkett Inc. approved the company's unaudited consolidated financial statements for the first quarter of 2001, ended March 31.

Consolidated net sales for the first quarter reached $163,054,000 compared to $154,452,000, an increase of 5.6% over the previous year. Of this total, 85.8% was generated on the U.S. market, compared to 85.0% for the same period in 2000.

The increase in consolidated net sales is attributed to the following factors: the weakening of the Canadian dollar against the U.S. dollar; net sales growth for hardwood flooring and, to a lesser extent, for commercial resilient flooring. At a constant exchange rate, the first quarter sales of 2001 would have been $155,747,000 or an increase of 1% over the same quarter of 2000.

Net sales for the resilient flooring segment were relatively stable, rising to $101,640,000 compared to $101,298,000 in the same quarter last year. While the decline in net sales for residential resilient flooring is due to persistent, significant competitive pressures, the increased volume of commercial resilient flooring offsets it.

The largest gains in sales were reported in the hardwood-flooring segment. This segment's net sales reached $43,443,000, compared to $35,849,000 one year ago, resulting in 21.2% growth including an exchange gain of $2,183,000 compared to 2000. The hardwood business accounts for 26.6% of consolidated net sales, compared to only 23.2% in the first quarter of 2000. This growth is mainly due to the increased sales through the Home Center Market.

``In spite of the softening economy, higher energy costs and higher raw material costs in both our resilient and hardwood products, our restructuring efforts are starting to show progress'', said Domco Tarkett President and CEO Ulf Mattsson. ``The profit margins showed improvement compared to the last two quarters of 2000, but did not reach last year's level. Sales increased in the first quarter compared to the first quarter 2000. We intend to continue our efforts to improve profitability, however, we do not anticipate any dramatic improvement in the economic environment, raw material prices or energy costs.''

Domco Tarkett Inc., headquartered in Farnham, Quebec, Canada, is the second largest North American manufacturer of vinyl and hardwood flooring.