Hines Horticulture Has Taken a Precautionary Action to Suspend the Shipment of Certain Plants

IRVINE, Calif.--(BUSINESS WIRE)--March 19, 2004--Hines Horticulture, Inc. (Nasdaq:HORT) today announced that as a precautionary measure it has voluntarily suspended shipments of plants on the U.S. Department of Agriculture's ("USDA") Sudden Oak Death ("SOD")-host list from its facilities in California even though these facilities have not tested positive for the detection of SOD. The Company's annual sales of plants grown at its facilities in California that are on the USDA SOD-host list are less than one percent of the Company's annual consolidated sales. In addition to the four California facilities, Hines has nine other facilities located in various states across the country that minimizes the potential adverse impact to the Company or its customers.

Sudden Oak Death, which is referred to as SOD, is caused by a fungus-like pathogen recently identified by scientists in California and named Phytophthora ramorum. Since its appearance in 1995, SOD has killed thousands of coast live oak, black oak, tanoak and Shreve oak in northern California. SOD can also infect the leaves and branches of a number of plants referred to as SOD-host plants. Out of thousands of plant varieties in the market, there are approximately forty plant varieties that have been identified as SOD-hosts, of which Hines grows only four varieties. Camellias are one of these four varieties of plants that Hines grows that are on the SOD-host list.

In 2002, the USDA enacted regulations relating to Sudden Oak Death. The Company's facilities in northern California, located in Vacaville and Winters, are located in a regulated county and, as a result, have a compliance agreement with the California Department of Food & Agriculture ("CDFA") and the USDA to ship product interstate. The compliance agreement requires that potential SOD-host plants, which, in the case of the Company's northern California facilities, is limited to Camellias, be inspected and tested monthly during the growing season for the presence of Phytophthora ramorum. These facilities continue to test as SOD-free places of production. In February 2004, as part of the SOD National Nursery Survey, the USDA encouraged all states to conduct a survey of nurseries that ship SOD-host plants interstate. Accordingly, the CDFA conducted this survey at all nurseries located in southern California. Samples of SOD-host material were collected and submitted to the CDFA Pathology Laboratory as part of this survey. On March 9, 2004, the CDFA issued a Pest Exclusion Alert notifying all County Agricultural Commissioners of the detection of Phytophthora ramorum, the causal pathogen of SOD, on several varieties of Camellia species at a nursery in Los Angeles County, which is not owned by Hines. In addition, this pathogen has also been detected at a nursery in San Diego County, which is also not owned by Hines. To date, surveys have been conducted in six counties in southern California. Laboratory analysis is still pending on SOD-samples submitted from our Irvine and Fallbrook facilities and from other nurseries in those counties.

On March 12, 2004, the Florida Department of Agriculture and Consumer Services declared an immediate quarantine on all plant material coming from California. On March 15, 2004, the Georgia Department of Agriculture announced an identical quarantine on all plant material shipped from California. The USDA is currently working with these states to attempt to modify or lift this comprehensive quarantine and thereby restrict the quarantine to only SOD-host plants. At this time, the Company is not aware of any other states that have issued such quarantine requirements. The annual sales from the Company's California facilities into the state of Georgia comprise less than one percent of the Company's annual consolidated sales. The Company does not ship any plants into the state of Florida from its facilities in California.

Even though the Company's facilities in California have not tested positive for SOD, Hines has taken the proactive precautionary measure of voluntarily suspending the shipment of all SOD-host plants that are grown at these three facilities in California. The four varieties of SOD-host plants that are grown at only three of the four facilities in California comprise less than one percent of the Company's annual consolidated sales. In addition, the Company has suspended the shipment of all plants from its facilities in California into the state of Georgia pending notification of a change in the comprehensive quarantine requirement by Georgia.

Hines will continue to monitor this situation very closely and will continue to take as many proactive actions as possible to assist the industry and minimize any negative impact to Hines or its customers.

About Hines

Hines Horticulture is a leading operator of commercial nurseries in North America, producing one of the broadest assortments of container-grown plants in the industry. The Company sells nursery products primarily to the retail segment, which includes premium independent garden centers, as well as leading home centers and mass merchandisers.

Certain statements and information contained in this press release constitute forward-looking statements within the meaning of the Federal Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Certain forward-looking statements include, but are not limited to, statements about the Company's plans, objectives, prospects, developments, expectations, intentions and other statements contained in the press release that are not historical facts.

Additional detailed information concerning a number of the important factors that could cause actual results to differ materially from the forward-looking information contained in this release are publicly available in the Company's filings with the Securities and Exchange Commission, including the Company's annual report on Form 10-K for the year ended December 31, 2002, and the Company's Form 10-Q for the quarter ended September 30, 2003. These factors include, but are not limited to, general economic trends and seasonality; general agricultural risks beyond our control, including risks associated with disease and pests and with Sudden Oak Death; our substantial leverage and ability to service our debt; restrictive covenants under our debt facilities; competitive practices in the industry in which we compete; fluctuations in our operating costs, revenues and cash flows from operations; our dependence on a limited number of key customers; potential significant increases in transportation costs; and the other factors set forth in such filings.

The Company's annual report and SEC filings, as well as news releases and other supplementary financial data are available by accessing the Company's website at www.hineshorticulture.com.