GRIFFON CORPORATION ANNOUNCES OPERATING RESULTS FOR THE THIRD QUARTER OF FISCAL 2001 AND AUTHORIZES 10 PERCENT STOCK DIVIDEND

Jericho, New York, August 6, 2001 — Griffon Corporation (NYSE: GFF) today reported operating results for the third quarter of fiscal 2001, ended June 30, 2001. The company’s Board of Directors also authorized a 10 percent common stock dividend payable on September 4, 2001 to shareholders of record on August 20, 2001.

Net sales for the third quarter increased to $289,384,000 compared to $278,719,000 for the third quarter of fiscal 2000. The sales growth came from both specialty plastic films’ domestic and European operations due to increased unit volume and from improving results in the company’s building products operations.

Pretax income for the quarter rose to $15,447,000 compared to $11,524,000 last year. Net income for the quarter was $7,731,000 compared to $6,248,000 for the third quarter of last year. Basic net income per share for the current quarter was $.26 compared to $.21 last year. Diluted net income per share for current quarter was $.25 per share compared to $.21 per share for the last year’s third quarter. On a pro forma basis after giving retroactive effect to the 10 percent common stock dividend, basic and diluted net income per share for the current quarter would both be $.23 compared to $.19 for the third quarter of fiscal 2000.

Specialty plastic films achieved another quarter of substantial earnings growth on the strength of continued higher unit sales volume and manufacturing efficiencies both domestically and in Europe. Further strong performance is anticipated from this segment.

The company’s building products operations posted higher sales and earnings in the third quarter. The improved operating results were principally driven by stronger demand for residential garage doors and the effect of cost reduction programs. The company anticipates that building products’ near-term operating results will continue to improve.

Telephonics, the company’s electronic information and communication systems segment, reported lower profits compared to last year primarily due to increased research and development activities and the effect of lower sales. Research and development expenditures included costs associated with the segment’s previously announced technology initiatives which are expected to total approximately $5 million for the year. Although this segment will continue to be impacted by the increased research and development activities and reduced orders in its integrated circuit business, the company is optimistic that Telephonics’ healthy backlog will fuel near-term improvement in its core operations.

Net sales for the nine months ended June 30, 2001 were $841,768,000 compared to $818,369,000 for the first nine months of fiscal 2000. Pretax income for the nine months rose to $38,185,000 compared to $29,448,000 last year. Income before minority interest increased to $22,529,000 from $17,669,000 last year.

In addition, the company indicated that cash flow generated from operations was approximately $72,000,000 during the first nine months of fiscal 2001, compared to approximately $12,000,000 for last year’s nine-month period. A portion of this substantial liquidity was used to reduce outstanding debt levels by approximately $30,000,000 at June 30, 2001, with further reductions anticipated in the fourth quarter of the year.

Griffon Corporation —

• is a leading manufacturer and marketer of residential, commercial and industrial garage doors sold to professional installing dealers and major home center retail chains;
• installs and services specialty building products and systems, primarily garage doors, openers, fireplaces and cabinets, for new construction markets through a substantial network of operations located throughout the country;
• is a leader in the development and production of embossed and laminated specialty plastic films used in the baby diaper, feminine napkin, adult incontinent, surgical and patient care markets; and
• develops and manufactures information and communication systems for government and commercial markets worldwide.

“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: All statements other than statements of historical fact included in this release, including without limitation statements regarding the company’s financial position, business strategy, and the plans and objectives of the company’s management for future operations, are forward-looking statements. When used in this release, words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” and similar expressions, as they relate to the company or its management, identify forward-looking statements. Such forward-looking statements are based on the beliefs of the company’s management, as well as assumptions made by and information currently available to the company’s management. Actual results could differ materially from those contemplated by the forward-looking statements as a result of certain factors, including but not limited to, business and economic conditions, competitive factors and pricing pressures, capacity and supply constraints. Such statements reflect the views of the company with respect to future events and are subject to these and other risks, uncertainties and assumptions relating to the operations, results of operations, growth strategy and liquidity of the company. Readers are cautioned not to place undue reliance on these forward-looking statements. The company does not undertake to release publicly any revisions to these forward-looking statements to reflect future events or circumstances or to reflect the occurrence of unanticipated events.