Tokos Medical, SANTA ANA

Nature of Business: Provides home health care services to the OB/GYN market.

Total Employees: 1,500 In Orange County: 360

Stock Listing in The Times: On NASDAQ as “TokosMd� Ticker Symbol: “TKOS�

Friday’s Stock Close: $33.50 One-Week Change: Down $2.50

Analyst Review: “The service Tokos Medical offers is clearly being proven cost-effective in the marketplace. They have gotten an increased number of insurers to cover their products, which makes the technology more available to the population. Their growth rate could be strong. Right now they have 70% of the market, and there are similar women’s home care lines Tokos that can layer onto their existing infrastructure that could add to their growth potential. Their balance sheet is very strong--they don’t have much debt, and they’ve been building cash. The biggest factor for their huge earnings increase for fiscal 1991 was that they got FDA approval for the Genesis Home Uterine Activity Monitor in fourth quarter 1990. After that, first quarter 1991 turned solidly profitable as more insurance companies became payers. Once Tokos started getting paid more for their services, revenues accelerated, and it all fell through to the bottom line. I am currently recommending the stock. They are the number one company in the women’s home care niche. I think their growth will be 30% to 35% per year over the next several years.�

--Randall S. Huyser, analyst, Furman Selz Inc., San Francisco

SALES VS. PROFITS

Fiscal year ending Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 1987 1988 1989 1990 1991 Net Revenue $30.4 $45.8 $64.5 $79.2 $115.2 Net Profit (Loss) $1.1 $1.7 ($.447) ($1.4) $7.1

Corporate Outlook: “What accounts for the significant rise in revenues and profits is that Tokos Medical made a lot of fixed investments, putting in place a substantial infrastructure over the past eight years. 1991 demonstrates our ability to leverage off that infrasturcture, and drop through incremental revenue to the bottom line. Looking toward the future, the market niche we’re focused on is quite large--several billion dollars. We think we’re bringing real value to the marketplace, but we still have substantial opportunities for growth.�

--Robert F. Byrnes, chairman/CEO

5-YEAR SUMMARY: RETURN ON STOCKHOLDER INVESTMENT

Fiscal year ending Dec. 31 Dec. 31 Dec. 31 Dec. 31 1987 1988 1989 1990 52-Week High N/A N/A N/A $16.50 52-Week Low N/A N/A N/A $7.50 Book Value Per Share $1.35 $1.47 $1.55 $2.97 Price Per Share N/A N/A N/A $13.00 Net Earnings Per Share $0.11 $0.17 ($0.04) ($0.10) Price-to-Earnings Ratio N/A N/A N/A N/A Avg. Return to Investor 8% 12% N/A N/A

Fiscal year ending Dec. 31 1991 52-Week High $46.25 52-Week Low $10.50 Book Value Per Share $3.32 Price Per Share $45.00 Net Earnings Per Share $0.44 Price-to-Earnings Ratio 102:1 Avg. Return to Investor 13%

* Tokos Medical sold 2.2 million shares in its initial public offering March 26, 1990; net proceeds: $23.8 million.

Source: Tokos Medical Corp.

For more information call or write, Tokos Medical Corp.: 1821 E. Dyer Road, Santa Ana, Calif., 92705. (714) 474-1616