Allergy Research Group, Inc. Reports Increased Earnings Before Tax for Third Quarter

HAYWARD, Calif., Nov 15, 2004 (BUSINESS WIRE) -- Allergy Research Group, Inc. (ALRG) announced financial results for the third quarter ending September 30, 2004.

ALRG recorded total revenue of $3,723,401 for the quarter, up 12% from 2003. The increase of $396,444 is primarily due to increased sales to distributors and increased demand at retail and wholesale for current and new products.

Cost of sales increased $177,930 to $2,076,622 for the quarter ended September 30, 2004, compared to $1,898,692 for the quarter ended September 30, 2003. The increase in cost of sales corresponds with the increase in sales. Gross profit margins increased approximately 1% as a result of higher profit margins associated with retail sales. Gross profit margins were approximately 44% at September 30, 2004.

During the quarter ended September 30, 2004, the Company recorded net earnings before tax of $618,221 as compared to net earnings before tax of $436,065 for the same period in 2003. The increase is a result of increased sales partially offset by a small increase in operating expenses (approximately $40,000). Due to an increase in the provision for income tax and change in deferred taxes, net income for the third quarter 2004 is $354,336 compared to $397,517 for the same period last year.

About Allergy Research Group, Inc.

Allergy Research Group, Inc. is an innovative leader in nutraceutical research and product formulation. Since its inception in 1979, the company has been noted for quality, hypoallergenic nutritional supplements and supplies products to physicians and healthcare practitioners worldwide.

Except for historical information contained herein, this release contains, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, forward-looking statements that are based on management's beliefs and assumptions, current expectations, estimates and projections. Many of the factors that will determine the Company's financial results are beyond the ability of the Company to control or predict. These statements are subject to risks and uncertainties and therefore actual results may differ materially. The Company disclaims any obligation to update any forward-looking statements whether as a result of new information, future events, or otherwise. Important factors and risks that may affect future results include but are not limited to: the impact of competitive products, changes in law and regulations, adequacy and availability of insurance coverage, availability of raw materials, dependence on distributors and customers, litigation, limitations on future financing, the effect of adverse publicity, uncertainties relating to acquisitions, managing and maintaining growth, customer demands, as well as other risks and uncertainties that are described from time to time in the Company's filings with the Securities and Exchange Commission, copies of which are available upon request from the Company's investor relations department.

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