GRUPO SIDEK ANNOUNCES PRELIMINARY RESULTS

Source: Grupo Sidek, S.A. de C.V.

March 3, 1999
In Guadalajara, Mexico, Grupo Sidek, S.A. de C.V. ("SIDEK") (OTC-Bulletin Board: GPSAY GPSBY) announced today its preliminary (unaudited) results for the year ended December 31, 1998.

Sidek's revenues decreased approximately 3% during 1998 as compared to the same period of 1997, falling from Ps. 4,861 million to Ps. 4,701 million. Sidek recorded financing expense of Ps. 493 million in 1998 versus a financing income of Ps. 464 million in 1997 due principally to the significant devaluation of the peso versus the dollar in 1998. Primarily, as a result of the foregoing, Sidek recorded a net loss of majority stockholders of Ps. 1,299 million in 1998, versus net loss of majority stockholders of Ps. 3,928 million in 1997.

In 1997, Sidek made a capital contribution to Grupo Situr, S.A. de C.V. ("Situr") (OTC-Bulletin Board: GPSRY) by transferring to Situr, Sidek's entire equity position in Grupo Simec, S.A. de C.V. ("Simec") (Amex: SIM) and Grupo Sinam, S.A. de C.V. ("Sinam"). As a result of such capital contribution, Sidek's equity interest in Situr increased from 60% to 92%. In turn, Situr's direct ownership in Simec is 62% and in Sinam is 100% as of December 31, 1998. Grupo Situr, among other things, is the owner/operator of the Plaza Las Glorias and Continental Villas timeshare resorts.

In July 1997, as part of Simec's corporate strategy to focus exclusively on its steel business, Simec's Board of Directors approved the disposition of its aluminum operations conducted through Aluminio Conesa, S.A. de C.V. On June 3, 1998, Compania Siderurgica de Guadalajara, S.A. de C.V. ("CSG" a wholly owned subsidiary of Simec) agreed to sell the shares of Conesa to Industrias Nacobre, S.A. de C.V. (a subsidiary of Grupo Carso, S.A. de C.V.) for $17.4 million and on July 16, 1998 the sale closed. In 1996, Simec estimated that the sale of Conesa would result in a loss of approximately Ps. 110 million (nominal pesos) and establish a provision in such amount.

The loss in the disposition of Conesa was approximately Ps. 94 million and, as a result, extraordinary income of approximately Ps. 27 million was recorded in 1998.Revenues of Situr increased by approximately 19% during 1998 as compared to the same period of 1997, from Ps. 3,947 million to Ps. 4,701 million, primarily due to the inclusion of the results of Simec effective May 1, 1997 as a result of the capital contribution referenced in the preceding paragraph. Revenues of Situr's Real Estate Sales Division increased approximately 46% during 1998 as compared to 1997, from Ps. 384 million to Ps. 562 million, due primarily to the sale in July 1998 of the hotel and marina located in San Diego, CA. Revenues of Situr's Hotel and Timeshare Division decreased approximately 13% in 1998 as compared to the comparable period in 1997, falling from approximately Ps. 1,511 million to Ps. 1,312 million, primarily as a result of a decrease in the average occupancy rate of Situr's hotels. Revenues of Simec decreased approximately 5% in 1998 as compared to the same period in 1997, falling from Ps. 2,631 million to Ps. 2,511 million.

Sidek's cost of sales decreased approximately 1% to Ps. 2,860 million in 1998, or 61% of revenues, versus Ps. 2,903 million, or approximately 60% of revenues, for the comparable period in 1997. Situr's cost of sales (which include the results of Simec effective May 31, 1997) increased approximately 37% during 1998 as compared to the same period of 1997, from Ps. 2,090 million, or 53% of revenues to Ps. 2,859 million, or approximately 61% of revenues. Simec's direct cost of sales decreased approximately 7% to Ps. 1,691 million in 1998, or 67% of revenues, versus Ps. 1,827 million, or 69% of revenues, for the comparable period in 1997.

Sidek's selling, general and administrative expenses (excluding non-recurring expenses, reserves and contingencies) increased approximately 5% in 1998 as compared to the same period of 1997, from Ps. 1,509 million to Ps. 1,588 million. Situr's general, selling and administrative expenses (excluding non-recurring expenses, reserves and contingencies) increased approximately 34% in 1998 as compared to the same period of 1997, from Ps. 1,144 million to Ps. 1,538 million. Simec's selling, general and administrative expenses (including depreciation and amortization) decreased approximately 1% during 1998 as compared to the same period in 1997, falling from Ps. 469 million to Ps. 466 million.Sidek recorded earnings from operations in 1998 of Ps. 111 million versus a loss from operations of Ps. 1,168 million in the same period of 1997. Situr recorded earnings from operations (which include the results of Simec effective May 31, 1997) of Ps. 220 million during 1998 as compared to a loss from operations of Ps. 401 million in the same period of 1997. Simec's earnings from operations increased approximately 6% during 1998 as compared to the same period in 1997, rising from Ps. 335 million to Ps. 355 million.

At December 31, 1998, on a consolidated basis, Sidek had total debt of approximately Ps. 6,806 million, approximately 99% of which was denominated in US dollars and approximately 1% of which was denominated in pesos.

As of December 31, 1998, the financial statements reflect the positive effects of the Sidek Restructuring closed on March 30, 1998. Although as a result of the Sidek Restructuring and certain accounting conventions Sidek has net equity of approximately Ps. 3,597 million, Sidek does not believe that significant, if any, value will be attributable to its equity after fulfilling its obligations pursuant to the Sidek Restructuring.

All figures presented were prepared in accordance with Mexican Generally Accepted Accounting Principles and are stated in constant pesos at December 31, 1998.

Grupo Sidek is engaged through its subsidiaries Grupo Situr and Grupo Simec in two primary lines of business. Situr is an owner and operator of hotels in Mexico and is also engaged in the real estate and timeshare sales. Simec is a Mexican mini-mill steel producer and manufactures a broad range of non-flat structural steel products.