Salton Reports First Quarter Results

Salton, Inc. (NYSE: SFP) announced today fiscal results
for its first quarter ended October 1, 2005. The Company reported net
sales of $148.4 million for its fiscal 2006 first quarter compared to
net sales of $204.7 million for the fiscal 2005 first quarter. Salton
reported net income of $29.7 million, or $2.43 per share or $1.83 per
diluted share, versus a loss of $(3.2) million, or ($0.28) per share
for the same period in fiscal 2005. Net sales decreased domestically
by $47.0 million as a result of restructuring and the uncertainty it
created among one of our large suppliers and a few customers. This
uncertainty impacted product availability and demand for the first
quarter. The Company has now concluded a major portion of its
restructuring efforts. Foreign sales declined by $9.2 million. The
foreign sales were impacted by weak consumer demand and some product
shortages in the United Kingdom. As a result of the sale of
Amalgamated Appliance Holdings Limited (AMAP) on September 29, 2005,
the results of AMAP have been included in discontinued operations for
the first quarter of fiscal 2006 and 2005.
   The Company's gross margin was 27.0% for the first quarter of
fiscal 2006, compared to 32.6% for the year earlier period. Gross
margins decreased as a result of an inventory shortage of higher
margin products and increased closeouts in the domestic market. In
addition, Salton's business and its margins continue to be affected by
the high cost of steel, corrugated and oil-based raw materials.
Despite these challenges, operating expenses, including distribution
costs, declined $8.8 million in the first quarter of fiscal 2006
compared to fiscal 2005. This was primarily a result of $7.8 million
in domestic cost improvements.
   Net income increased by $32.9 million primarily as a result of a
$27.8 million gain from the sale of the Company's 52.6% ownership
interest in AMAP and a pre-tax gain of $21.7 million from the early
retirement of debt associated with the Company's Exchange Offer. The
Company had a loss from operations of $(11.0) million compared to
operating income of $6.2 million in the year-earlier period.
   The Company had approximately $301.8 million in indebtedness, net
of cash and restructuring interest on senior secured notes of $28.5
million at the end of the fiscal 2006 first quarter, compared to
$429.3 million as of July 2, 2005.
   As a result of lower than expected sales, the Company was not in
compliance with its financial covenants as of the end of the first
quarter of fiscal 2006 and does not expect to be in compliance as of
November 5, 2005. Salton sought and received The Sixth Amendment and
waiver from its senior lenders, who also agreed to provide additional
availability of $5.0 million for seasonal build-up of inventory.
   "During the last 18 months, Salton has taken significant steps to
make the Company less leveraged and more competitive. Our goal remains
to return the Company to profitability," said William Rue, President
and Chief Operating Officer. "Recently, we completed the sale of AMAP
and our Tabletop Division which improved our balance sheet and will
allow us to focus on sales initiatives and our business. Through our
cost reduction programs, we have reduced our annual domestic expenses
by more than $55.0 million. We will continue to seek ways to make our
business more cost effective and profitable, while looking for new
ways to grow."

   Business Outlook:

   "As we had indicated previously, our sales for the first quarter
were weak due to the impact of our restructuring efforts, delays in
customer orders, product shortages and the effects of the hurricanes,"
said Leonhard Dreimann, Chief Executive Officer. "However, we are
encouraged by recent reactions from customers and suppliers. Incoming
orders indicate customers are excited about our new products such as
the George Foreman(R) "G5" Next Grilleration, the latest in a line of
removable plate grills developed by the Company and George Foreman. We
expect a much stronger second quarter"
   The conference call will take place at 9 a.m. EST on November 10,
2005. Leonhard Dreimann, Chief Executive Officer, William Rue,
President and Chief Operating Officer and David Mulder, Executive Vice
President, Chief Administrative Officer and Senior Financial Officer
will host the call. Interested participants should call [phone]
when calling from the United States or [phone] when calling
internationally. Please reference Conference I.D. Number 2140676.
   There will be a playback available until midnight, December 10,
2005. To listen to the playback, please call [phone] when
calling within the United States or [phone] when calling
internationally. Please use pass code 2140676 for the replay.
   This call is also being webcast and can be accessed at Salton's
web site at www.saltoninc.com until December 10, 2005. The conference
call can be found under the subheadings, "Stock Quotes" and then
"Audio Archives."

   About Salton, Inc.

   Salton, Inc. is a leading designer, marketer and distributor of
branded, high quality small appliances, electronics, home decor and
personal care products. Its product mix includes a broad range of
small kitchen and home appliances, electronics for the home, time
products, lighting products, picture frames and personal care and
wellness products. The Company sells its products under a portfolio of
well recognized brand names such as Salton(R), George Foreman(R),
Westinghouse(TM), Toastmaster(R), Mellitta(R), Russell Hobbs(R),
Farberware(R), Ingraham(R) and Stiffel(R). It believes its strong
market position results from its well-known brand names, high quality
and innovative products, strong relationships with its customer base
and its focused outsourcing strategy.

   Certain matters discussed in this press release are
forward-looking statements that are subject to certain risks and
uncertainties that could cause actual results to differ materially
from those set forth in the forward-looking statements. These factors
include: Salton's ability to repay the outstanding 10-3/4%
Subordinated Notes due December 15, 2005; Salton's ability to realize
the benefits it expects from its U.S. restructuring plan; Salton's
substantial indebtedness and restrictive covenants in Salton's debt
instruments; Salton's ability to access the capital markets on
attractive terms or at all; Salton's relationship and contractual
arrangements with key customers, suppliers and licensors; pending
legal proceedings; cancellation or reduction of orders; the timely
development, introduction and customer acceptance of Salton's
products; dependence on foreign suppliers and supply and manufacturing
constraints; competitive products and pricing; economic conditions and
the retail environment; international business activities; the risks
related to intellectual property rights; the risks relating to
regulatory matters and other risks and uncertainties detailed from
time to time in Salton's Securities and Exchange Commission Filings.

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                             SALTON, INC.
                      CONSOLIDATED BALANCE SHEETS
                        (Dollars in Thousands)
                               UNAUDITED

ASSETS                                              10/1/05    7/2/05
------
CURRENT ASSETS:
---------------
   Cash                                             $10,310   $14,857
   Compensating balances on deposit                  38,779    34,355
   Restricted cash                                   81,664         -
   Accounts Receivable, less allowance:             146,213   140,179
    2006 - $7,581; 2005 - $10,130
   Inventories                                      188,319   195,065
   Asset held for sale                                    -       998
   Prepaid expenses and other current assets         15,424    16,048
   Deferred income taxes                              6,402     5,524
   Current assets of discontinued operations              -   101,927
                                                   --------- ---------
       Total current assets                         487,111   508,953

Net Property, Plant and Equipment                    47,287    50,227

Tradenames                                          179,941   180,041
Non-current deferred tax asset                       27,239    49,275
Other assets                                         11,522    11,555
Non-current assets of discontinued operations             -     7,737
                                                   --------- ---------
TOTAL ASSETS                                       $753,100  $807,788
                                                   ========= =========

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
CURRENT LIABILITIES:
--------------------
   Revolving line of credit and other current 
    debt, including an adjustment of $9,713 and $0
    for accrued interest on the senior secured 
    notes, respectively                             $87,485   $70,730
   Senior subordinated notes-current                 45,990    45,990
   Accounts payable                                 113,075    86,254
   Accrued expenses                                  36,638    48,391
   Income Taxes Payable                               4,378     4,375
   Current liabilities of discontinued operations         -    47,331
                                                   --------- ---------
       Total current liabilities                    287,566   303,071

Non-current deferred income taxes                     3,040     3,334
Term loan and other notes payable                   100,050   100,050
Senior subordinated notes due 2005                        -    79,010
Senior subordinated notes due 2008, including an 
 adjustment of $2,578 and $7,082 to the carrying 
 value related to interest rate swap agreements, 
 respectively                                        62,206   156,387
Second lien notes, including an adjustment of 
 $18,756 and $0 to the carrying value for accrued 
 interest, respectively                             121,933         -
Series C preferred stock                              8,087         -
Other long term liabilities                          20,134    20,283
Non-current liabilities of discontinued operations        -     1,462
                                                   --------- ---------
       TOTAL LIABILITIES                            603,016   663,597
Minority interest in discontinued operations              -    24,263
Convertible Preferred Stock, $.01 par value: 
 authorized, 2,000,000 shares, 40,000 shares 
 issued                                              40,000    40,000
STOCKHOLDERS' EQUITY:
---------------------
   Common stock, $.01 par value; authorized
     40,000,000 shares; issued and outstanding
     2006-13,520,761 shares, 2005-11,376,292
     shares                                             170       148
   Treasury stock - at cost                         (65,793)  (65,793)
   Additional paid-in capital                        62,356    55,441
   Accumulated other comprehensive income             5,068    11,513
   Retained Earnings                                108,283    78,619
                                                   --------- ---------
       Total stockholders' equity                   110,084    79,928
                                                   --------- ---------
  TOTAL LIABILITIES AND STOCKHOLDER EQUITY         $753,100  $807,788
                                                   ========= =========
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                              SALTON, INC
                    CONSOLIDATED INCOME STATEMENTS
                        (Dollars in Thousands)
                               UNAUDITED

                                                   13 Weeks Ended

                                               Oct 1, 2005 Oct 2, 2004
                                               ----------- -----------

Net Sales                                        $148,416    $204,684
Cost of Sales                                     108,371     137,986
Total Distribution Expense                         10,548      12,935
                                               ----------- -----------
Gross Profit                                       29,497      53,763
Total Selling, General & Administrative            40,418      46,854
Restructuring Costs                                   117         672
                                               ----------- -----------
Operating (Loss) Income                           (11,038)      6,237
Interest Expense                                   11,049      12,879
Gain-Early settlement of debt                     (21,655)          0
                                               ----------- -----------
(Loss) Income from Continuing Operations
 Before Income Taxes                                 (432)     (6,642)
Income Taxes                                         (545)     (2,197)
                                               ----------- -----------
Net (Loss) Income from Continuing Operations          113      (4,445)
Income (Loss) from Discontinued Operations,
 net of Tax                                         1,735       1,258
Gain on Sale of Discontinued Operations, net
 of Tax                                            27,816           -
                                               ----------- -----------
Net Income (Loss)                                 $29,664     $(3,187)
                                               =========== ===========

Weighted avg common shares outstanding         12,215,911  11,370,946
Weighted avg common & common equiv share       16,249,880  11,370,946

Net income(loss) per common share: Basic
   Income(loss) from continuing operations          $0.01      $(0.39)
   Income from discontinued operations, net of
    tax                                              0.14        0.11
   Gain on sale of discontinued operations           2.28           -
                                               ----------- -----------
Net income(loss) per common share: Basic            $2.43      $(0.28)
                                               =========== ===========

Net income(loss) per common share: Diluted
   Income(loss) from continuing operations          $0.01      $(0.39)
   Income from discontinued operations, net of
    tax                                             $0.11       $0.11
   Gain on sale of discontinued operations          $1.71          $-
                                               ----------- -----------
Net income(loss) per common share: Diluted          $1.83      $(0.28)
                                               =========== ===========
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