ARCTIC GROUP REPORTS SOLID 1999 SECOND QUARTER RESULTS

TUESDAY, DECEMBER 29, 1998 - Winnipeg, Manitoba – Building on its significant expansion through 1998, The Arctic Group Inc. Chairman and CEO, Robert Nagy announced today the company has continued its successful growth plan during the second quarter ended, October 31, 1998.

Revenue for the six months was $36,904,000, an increase of $32,120,000 over the previous year.

Net earnings of $4,427,000, or $0.204 per share increased by $3,662,000 compared to the $765,000 ($0.059 per share) reported last year.

Year-to-date, operating cash flow reached a level of $8,079,000 or $0.37 per share, a substantial increase over the prior year.

The continued improvement in the current year’s performance is attributed to the Company’s focus on operating profits within existing business units, combined with a disciplined expansion program.

During the first quarter of the fiscal year, the Company concluded acquisitions in Quebec, Ontario, Alberta and Iowa. In the second quarter, two additional transactions were completed to further consolidate the southern Ontario market. These transactions were funded with the proceeds from a special warrants offering and term debt, placed in spring.

At the end of October, the company finalized the acquisition of North Star Ice, one of the largest independent ice companies in the United States. North Star operates a modern, highly efficient plant and services the entire state of Minnesota. The Company financed this transaction through an acquisition line with one of its key lenders. Arctic also maintains a substantial operating line of credit, which is currently unutilized.

The Arctic Group is Canada’s largest ice company and is committed to building an internationally recognized company by focusing on an aggressive strategy of growth through acquisition and consolidation of the ice industry in North America.

For further information, call The Arctic Group Inc. TOLL FREE at 1-888-573-9237 or visit The Arctic Group’s Web Site at - http://www.arcticgroup.com.

(Signed)
On behalf of the Management and the Board of Directors of The Arctic Group Inc.,
Robert Nagy, Chairman & CEO.

The Alberta Stock Exchange has not reviewed and does not approve or disapprove of the adequacy or accuracy of this release.