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FRB	¦	WEBER SHANDWICK FINANCIAL COMMUNICATIONS	RE:	Raven Industries, Inc. P.O. Box 5107 Sioux Falls, SD 57117-5107

FOR FURTHER INFORMATION:

AT THE COMPANY: AT FRB ¦ WEBER SHANDWICK:

Tom Iacarella
VP & CFO
(605) 336-2750 Dennis Waite
General Inquiries
(708) 246-6265 Leslie Loyet
Analyst Inquiries
(312) 640-6672 Cindy Martin
Media Inquiries
(312) 640-6741

FOR IMMEDIATE RELEASE
THURSDAY, AUGUST 21, 2003 SIC CODES: 3672, 3081, 3829

RAVEN INDUSTRIES REPORTS 2ND QUARTER:
RECORD-HIGH PROFITS CLIMB 36%;
SALES UP 22% TO $36.1 MILLION

SIOUX FALLS, SD — August 21, 2003 — Noting a very strong performance in its Flow Controls Division, Raven Industries, Inc. (RAVN: NasdaqNM) today announced results for its second quarter and first half ended July 31, 2003. Net income for the second quarter rose to $3.2 million, or a record 34 cents per share, from $2.3 million, or 25 cents per share, for the three months last year. Raven reported that total sales for its second quarter increased 22 percent to $36.1 million.

For the first half of its fiscal year, Raven reported that net earnings increased 27 percent to $7.3 million, a record 79 cents per share, from $5.8 million, or 61 cents per share, in the first six months of the previous fiscal year. Total sales for the first half were up 20 percent to $73.1 million.

Unusually strong sales in the company’s Flow Controls Division, which typically reaches its seasonal low point in the second quarter, generated sharply higher operating income to help push overall quarterly results to a record level, Raven President and CEO Ronald M. Moquist said. The company’s Electronic Systems Division and Aerostar subsidiary also posted higher sales and profits.

Expectations for the Second Half and Year

CEO Moquist said that second-quarter and first-half results demonstrate the success of management’s efforts to focus on its higher margin core businesses. “We had a solid second quarter and an outstanding first six months,” Moquist said. “Going forward, our third-quarter results could be relatively flat when compared to last year’s third quarter, but the fourth quarter should be strong. I feel good about what we accomplished in the first half of the year. We’re on track, on target, and on our way to another record year.”

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Segment Performance

Flow Controls Division (FCD) second-quarter sales jumped to $9.0 million compared to $4.2 million in the second quarter of the prior year, and operating income totaled $1.3 million compared to an operating loss of $26,000 one year earlier. Six-month sales of $20.8 million were up 31 percent from the prior year and operating income of $4.9 million was 17 percent higher.

As noted in the first-quarter results, deliveries under a special order for chemical injection systems were delayed from the first quarter to the second. These sales totaled $3.9 million in the second quarter and $6.0 million for the six months, versus last year’s six-month sales of $2.6 million — all delivered in the first quarter. “FCD delivered a lot of product in the first half this year. We need to replace those special orders by leveraging our marketing muscle and new product introductions to drive further growth in this division,” CEO Moquist emphasized.

Engineered Films Division (EFD) sales for the second quarter “were good in view of challenging market conditions,” Moquist said. Sales were relatively flat at $11.2 million for the second quarter; operating income was down 17 percent at $3.0 million. Last year the division took advantage of comparatively low polyethylene resin prices in the second quarter to boost margins. This year resin prices stayed high and as a result, operating margins flattened out. For the six months, sales climbed 15 percent to $22.3 million and operating income was essentially unchanged at $6.0 million. “We brought on new equipment which doubled our extrusion capacity in January 2003, providing opportunities for new product introductions and higher sales volume,” Moquist noted.

Electronic Systems Division (ESD) second-quarter sales rose 7 percent to $11.7 million while operating income climbed 38 percent to $1.6 million. ESD sales for the six months were up 18 percent, reaching $21.7 million, as major new customers came onstream. Six Sigma initiatives continue to deliver further production efficiencies and greater profitability, management said, with operating income for the first half up $1.3 million to $2.7 million.

Aerostar has undergone a major reorganization in the past year and has returned to profitability, thanks in significant part to shipments of military cargo parachutes. Sales rose 30 percent to $4.2 million for the quarter while operating income reached $463,000 (excluding a $152,000 gain on the sale of a plant). First-half sales totaled $8.2 million vs. $5.7 million a year earlier while operating income totaled $927,000 against a loss of $298,000 in the first six months of the last fiscal year.

Cash Flow and Balance Sheet

Cash and short-term investments reached $19.9 million at July 31, 2003, compared to $12.5 million one year earlier. Inventory levels were down $1.7 million and accounts receivable levels were roughly flat despite higher revenues. Six-month cash flows from operating activities reached $14.7 million versus $8.9 million for the first six months of the prior year. On August 19, Raven announced a 12.5 percent increase in its quarterly dividend rate, to nine cents per share, effective with the October 15, 2003 payment. This comes only six months since its last dividend increase.

Moquist added that the recent inclusion of Raven’s common stock in the well-known Russell® 3000 index of U.S. equities reflects the company’s growth and the sizable increase in market capitalization over the past 12 months.

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FORWARD-LOOKING STATEMENTS

The Private Securities Litigation Reform Act provides a “safe harbor” for forward-looking statements. Certain information included in materials filed or to be filed by the company with the Securities and Exchange Commission (as well as information included in statements made or to be made by the company) contains statements that are forward looking. Although the company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, there is no assurance that such expectations will be achieved. Such assumptions involve important risks and uncertainties that could significantly affect results in the future. These risks and uncertainties include, but are not limited to, those relating to general economic conditions, weather conditions, which could affect certain of the company’s primary markets, such as agriculture and construction, or changes in competition, technology or the company’s customer base, any of which could adversely impact any of the company’s product lines.

On the Internet, information is available at FRB’s website,
www.frbwebershandwick.com, or the company’s website, www.ravenind.com.

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RAVEN INDUSTRIES, INC.
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except earnings per share)

			Three Months Ended July 31								Six Months Ended July 31
			2003			2002		Change			2003			2002		Change
			(unaudited)			(unaudited)					(unaudited)			(unaudited)
Net sales			$	36,110		$	29,692		22	%	$	73,052		$	60,666		20	%
Cost of goods sold				28,299			23,696		19	%		55,804			46,520		20	%
		Gross profit		7,811			5,996		30	%		17,248			14,146		22	%
Selling, general, and administrative expenses				2,766			2,568		8	%		5,668			5,414		5	%
Gain (loss) on sale of businesses and assets				(108	)		104					(99	)		104
		Operating income		4,937			3,532		40	%		11,481			8,836		30	%
Other income				39			37					51			53
		Income before income taxes		4,976			3,569		39	%		11,532			8,889		30	%
Income taxes				1,813			1,249		45	%		4,186			3,111		35	%
		Net income	$	3,163		$	2,320		36	%	$	7,346		$	5,778		27	%
Net income per common share:
	-basic		$	0.35		$	0.25		40	%	$	0.81		$	0.63		29	%
	-diluted		$	0.34		$	0.25		36	%	$	0.79		$	0.61		30	%
Weighted average common shares outstanding:
	-basic			9,037			9,178		(2	)%		9,055			9,183		(1	)%
	-diluted			9,233			9,408		(2	)%		9,246			9,417		(2	)%

RAVEN INDUSTRIES, INC.
SALES AND OPERATING INCOME BY SEGMENT
(In thousands)

			Three Months Ended July 31									Six Months Ended July 31
			2003			2002			Change			2003			2002			Change
			(unaudited)			(unaudited)						(unaudited)			(unaudited)
Net Sales:
	Flow Controls		$	9,044		$	4,167			117	%	$	20,805		$	15,939			31	%
	Engineered Films			11,186			11,130			1	%		22,325			19,352			15	%
	Electronic Systems			11,676			10,920			7	%		21,729			18,408			18	%
	Aerostar			4,204			3,222			30	%		8,193			5,653			45	%
	Sold Businesses			—			253			(100	)%		—			1,314			(100	)%
		Total Company	$	36,110		$	29,692			22	%	$	73,052		$	60,666			20	%
Operating Income (Loss):
	Flow Controls		$	1,286		$	(26	)		—		$	4,905		$	4,179			17	%
	Engineered Films			3,000			3,596			(17	)%		5,999			5,995			0	%
	Electronic Systems			1,625			1,174			38	%		2,722			1,382			97	%
	Aerostar			615			(107	)		675	%		927			(298	)		411	%
	Sold Businesses			(260	)		59			(541	)%		(280	)		129			(317	)%
	Corporate Expenses			(1,329	)		(1,164	)		(14	)%		(2,792	)		(2,551	)		(9	)%
		Total Company	$	4,937		$	3,532			40	%	$	11,481		$	8,836			30	%

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RAVEN INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)

		July 31,		January 31,		July 31,
		2003		2003		2002
		(unaudited)		(audited)		(unaudited)
ASSETS
Cash, cash equivalents and short-term investments		$	19,902	$	9,217	$	12,495
Accounts receivable, net			13,752		16,468		13,310
Inventories			15,734		21,366		17,468
Prepaid expenses and other current assets			2,289		2,300		2,632
	Total current assets		51,677		49,351		45,905
Property, plant and equipment, net			15,405		16,455		14,900
Other assets, net			6,955		7,010		8,110
		$	74,037	$	72,816	$	68,915
LIABILITIES AND STOCKHOLDERS’ EQUITY
Note payable		$	—	$	—	$	575
Current portion of long-term debt			112		119		116
Accounts payable			2,420		5,291		3,011
Accrued and other liabilities			7,398		7,757		7,166
	Total current liabilities		9,930		13,167		10,868
Long-term debt, less current portion			98		151		213
Other liabilities			1,440		1,262		1,631
Stockholders’ equity			62,569		58,236		56,203
		$	74,037	$	72,816	$	68,915

RAVEN INDUSTRIES, INC.
CONDENSED CONSOLIDATED CASH FLOW STATEMENTS
(In thousands)

			Six Months Ended July 31
			2003			2002
			(unaudited)			(unaudited)
Cash flows from operating activities
	Net income		$	7,346		$	5,778
	Adjustments to reconcile net income to net cash provided by operating activities:
		Depreciation and amortization		2,167			1,883
		Deferred income taxes		117			199
		Other operating activities, net		5,090			1,001
	Net cash provided by operating activities			14,720			8,861
Cash flows from investing activities
	Capital expenditures			(908	)		(2,601	)
	Other investing activities, net			17			585
	Net cash provided by (used in) investing activities			(891	)		(2,016	)
Cash flows from financing activities
	Dividends paid			(1,450	)		(1,286	)
	Purchase of treasury stock			(1,693	)		(1,093	)
	Short-term debt issuance			—			575
	Long-term debt principal payments			(60	)		(78	)
	Other financing activities, net			59			54
	Net cash used in financing activities			(3,144	)		(1,828	)
Net increase (decrease) in cash and cash equivalents				10,685			5,017
Cash and cash equivalents at beginning of period				5,217			7,478
Cash and cash equivalents at end of period				15,902			12,495
Short-term investments				4,000			—
Cash, cash equivalents and short-term investments			$	19,902		$	12,495