ARCTIC GROUP REPORTS RECORD REVENUES IN 2000

Winnipeg, Manitoba - The Arctic Group Inc. (TSE: AGP), a leading North American producer and distributor of high-quality packaged ice, today reported results for the fiscal year ended December 31, 2000.

For the fourth consecutive year The Arctic Group Inc. has achieved record revenues. For the year ended December 31, 2000, revenues totaled $82.1 million, an increase of 10.6 per cent from $74.3 million in 1999. The revenue growth is attributable to acquisitions completed during the previous twelve months combined with internal growth from existing operations and pricing opportunities made available by the Company's branding and product quality initiatives.

Earnings before interest, taxes, depreciation, amortization and non-recurring expenses (EBITDA) for the year was $21.6 million, an increase of $2.6 million. This increase represents a 13.6 per cent gain over EBITDA of $19.0 million in 1999. EBITDA margin increased in 2000 to 26.3 per cent from 25.6 per cent in 1999.

Funds from operations for the year increased to $9.6 million ($0.26 per share/$0.23 fully diluted), an increase of 12 per cent compared to $8.6 million ($0.24 per share/$0.21 fully diluted) in 1999.

After recording non-recurring expenses of $1.8 million and amortization of goodwill in the amount of $1.9 million for the year, the Company had a net loss of $2.9 million. On a per share basis, the loss was $0.03 per share excluding goodwill charges and $0.09 per share including goodwill charges. In 1999 the Company reported a net loss of $0.9 million after recording non-recurring expenses of $1.1 million and amortization of goodwill in the amount of $1.4 million; earnings of $0.01 per share excluding goodwill charges and a loss of $0.03 including goodwill charges.

"The 2000 year continued to see improvement in our operating results but these results have not as yet translated to a positive net income as a result of the significant non-cash charges to our income statement, including losses on the disposal of redundant assets. The Company incurred significant non-recurring expenses during the last quarter of the year related to the sale of redundant assets, severance costs associated with reductions in employee requirements and costs incurred relating to uncompleted transactions. The record operating performance was achieved despite unseasonably cool temperatures in eastern Canada and the northern U.S. during the critical second and third quarters, and an exceedingly cold fourth quarter in most of the Company's markets. Our ability to increase margins, in spite of disappointing weather conditions which significantly affected the sale of our products, verifies the effectiveness of our strategy to rationalize operations and target operational synergies." commented Robert Nagy, Arctic Group Chairman and CEO.

In May of 2001, Arctic negotiated with the holders of U.S. $18.4 million of convertible debentures issued in 1999 to eliminate the conversion feature of these debentures that represented potential significant dilution to the existing shareholders. In exchange for eliminating the conversion feature and the resulting dilution, the Company has agreed to a higher rate of interest in the total amount of 12.5 per cent which is slightly less than the Company would pay for a debt only instrument of comparable term and risk. The increase in interest rates from the current 8.25 per cent to 12.5 per cent will be accrued and paid at the maturity date of the debentures in August of 2004. The Company will also issue 6,865,000 warrants at $0.75 to the debenture holders that will expire at the maturity date of the debentures. If these warrants are converted into common shares, the potential dilution to the existing common shareholders will be reduced by half, compared to the original conversion privilege.

Mr. Nagy continued by saying that "during 2001 the Company will continue to focus on completing the rationalization of its operating facilities, including selling redundant assets acquired during the past several years. Although the resulting sale of these redundant assets often results in losses on disposal, Arctic is committed to streamlining operations to create long-term efficiencies. Arctic has invested significantly in capital programs during the past several years to position the Company to take advantage of its market presence. I am pleased to say that our program of capital improvements has largely been accomplished. Cash from operations, which was previously allocated to capital upgrades, will now be available for other purposes."

"During the next several years, the Company will also focus on the reduction of long term debt. This will be accomplished in a number of ways. While the Company historically has not produced a positive net income as a result of non-cash charges to our income statement, the Company does generate a significant amount of cash that can be used to reduce debt. In addition, the Company will look to divest non-strategic assets and use the cash for debt reduction and/or reinvestment into higher return assets."

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 Toronto Stock Exchange does not approve or disapprove of the adequacy or accuracy of this release.