Kideo Productions, Inc. reports third quarterresults.

NEW YORK--(BUSINESS WIRE)--June 16, 1997--Kideo Productions, Inc. (NASDAQ: KIDO; KIDOW) today announced results for its third quarter ended April 30, 1997.

Sales for the third quarter increased 177% over the comparable quarter in the prior fiscal year. Sales during the period reached $302,000

vs. $109,000, reflecting an increase in direct-to-consumer sales resulting from radio and television advertising during the quarter. The Company's first national direct response TV campaign was initiated in the second quarter, and continued into the third quarter featuring one and two minute commercials airing on cable networks and in 30 broadcast markets.

The net loss for the quarter was to $1,010,000, or $0.34 per share on 2,939,000 weighted average shares outstanding, vs. $612,000 or $0.45 per share on 1,347,000 weighted average shares outstanding. The loss in the current quarter includes approximately $500,000 in product launch costs and $82,000 in professional fees related to business development. The third quarter of the prior year included $204,000 of nonrecurring expenses related to debt that was extinguished.

Sales in the nine month period increased 59% over nine months sales in the prior year. Sales increased to $1,063,000 from $670,000 a year earlier.

The net loss for the nine months was $3,345,000, or $1.14 per share on 2,939,000 weighted average shares outstanding, vs. $1,587,000 or $1.18 per share on 1,374,000 weighted average shares outstanding.

Kideo Productions, Inc. uses proprietary digital technologies to produce personalized video products for children in which the child's face and name are inserted, making the child the main character in the story. Personalized Kideo videos are designed to reinforce positive educational and behavioral themes such as self-esteem, friendship, spelling and counting. The Company also manufactures and markets a full line of toy products based on the Company's proprietary characters. -0-

                            KIDEO PRODUCTIONS, INC.
                        SUMMARY FINANCIAL INFORMATION

                     (In thousands except per share amounts)

                          Three Months Ended        Nine Months Ended
                      April 30,      April 30,    April 30,    April 30,
                         1997          1996         1997         1996

Sales                $   302         $  109     $  1,063       $  670
Cost of sales            263            130          873          497
Gross margin              39            (21)         190          173


Selling expenses         598            121        1,852          536
General &
 administrative expenses 440            276        1,703          805
Loss from operations    (999)          (418)      (3,365)      (1,168)

Other income (expense),
 net                     (11)           (15)          20          (70)
Non recurring debt
 expenses                              (204) (a)                 (350) (a)
 Net (loss)          $(1,010)          (637)     $(3,345)      (1,588)

  Pro forma net (loss)               $ (612) (b)             $ (1,587) (b)


Net (loss) per share $ (0.34)                    $ (1.14)

  Pro forma net (loss)
   per share                         $(0.45)                 $  (1.18)


Weighted average shares
 outstanding          2,939                        2,939

 Pro forma weighted
  average shares
                                      1,347 (c)                 1,347 (c)

Balance Sheet Data:
ASSETS                           April 30, 1997      July 31, 1996
Cash & equivalents                  $    36            $  2,857

Accounts receivable                      45                  95
Inventory                               112                  --
Prepaid expenses                         55                 140

   Total current assets                 248               3,092

 Noncurrent assets                    1,354               1,276
   Total assets                     $ 1,602            $  4,368

LIABILITIES AND STOCKHOLDERS' EQUITY
 Current liabilities                $ 1,272            $    702

 Capitalized leases & long
  term debt                              90                  80
   Total liabilities                  1,362                 782
 Shareholders' equity                   240               3,586
   Total liabilities and shareholders'
    equity                          $ 1,602            $  4,368

(a) Reflects the cost of interest, debt issuance costs, and original

issue discount related to debt that was extinguished upon the closing

of the Company's Initial Public Offering. (b) Pro forma net loss gives effect to certain employment contracts

as if those had been in effect from the beginning of the period.

Also reflects interest savings on assumed conversion of debt for

purposes of calculating pro forma earnings per share. (c) Gives effect to shares issued (or issuable on conversion) at

prices below the IPO price as of the beginning of the period

presented.

CONTACT: Kideo Productions, Inc., New York

Robert J. Riscica, CFO

(212) 505-6605; (212) 505-2142 FAX

or

Wolfe Axelrod Associates, New York

Mona J. Walsh

Stephen D. Axelrod, CFA

Susan T. Bolen (Media)

(212) 370-4500; (212) 370-4505 FAX

e-mail: 76015.440@compuserve.com