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Walter Industries, Inc. Announces 400,000 Ton Per Year Expansion of Surface Mining Operations and Doubles Quarterly Dividend to $0.10 Per Share

Posted on: Thursday, 31 July 2008, 09:01 CDT

TAMPA, Fla., July 31 /PRNewswire-FirstCall/ -- Walter Industries, Inc. , a leading producer and exporter of U.S. metallurgical coal for the global steel industry, announced today that its Board of Directors has approved a plan to expand the Company's United Land subsidiary's surface mining operations by opening a new coal mine with 0.4 million tons of annual capacity.

The Board also approved a 100 percent increase to its regular quarterly dividend rate - to $0.10 per common share.

"The decision to develop United Land's new mine illustrates our commitment to reinvest our strong cash flow into organic opportunities to grow our business," said Company Chairman Michael T. Tokarz. "At the same time, the increase in our dividend rate reflects our confidence in the continued strength of the cash flows from Walter Industries' core Natural Resources businesses. Both of these initiatives reward our shareholders for their confidence in us."

Surface Mining Expansion

United Land's new mine - to be known as Flat Top Mine - is a 600-acre surface coal mine with reserves of approximately 2.3 million tons of steam and industrial coal on land owned by the Company. Development of the mine will begin immediately and, because permits are already in place, coal is expected to be available for sale by May 2009 and is expected to be accretive to earnings in its first year of operation. United Land will invest approximately $30 million to develop the mine, which will employ approximately 50 people, and will be located in Jefferson County, Ala., 11 miles northwest of Birmingham.

Dividend Payment

The dividend increase is Walter Industries' second such increase in the last 18 months. The Company last announced a dividend increase on Feb. 7, 2007, when it increased the dividend from $0.04 to $0.05 per common share. The $0.10 per share dividend is payable on Sept. 12, 2008 to shareholders of record at the close of business on Aug. 8, 2008.

About Walter Industries

Walter Industries, Inc., based in Tampa, Fla., is a leading producer and exporter of metallurgical coal for the global steel industry and also produces steam coal, coal bed methane gas, furnace and foundry coke and other related products. The Company also operates a mortgage financing and affordable homebuilding business. The Company has annual revenues of approximately $1.2 billion and employs approximately 2,500 people. For more information about Walter Industries, please visit the Company Web site at http://www.walterind.com/ .

Safe Harbor Statement

Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements, including expressions such as "believe,""anticipate,""expect,""estimate,""intend,""may,""will," and similar expressions involve known and unknown risks, uncertainties, and other factors that may cause the Company's actual results in future periods to differ materially from the expectations expressed or implied by such forward-looking statements. These factors include, among others, the following: the market demand for the Company's products as well as changes in costs and the availability of raw material, labor, equipment and transportation; changes in weather and geologic conditions; changes in extraction costs, pricing and our assumptions and projections concerning our reserves in the Company's mining operations; changes in customer orders; pricing actions by the Company's competitors, customers, suppliers and contractors; changes in governmental policies and laws; changes in the mortgage-backed capital markets; changes in general economic conditions; and the successful implementation and anticipated timing of any strategic actions and objectives that may be pursued, including our announced separation of the Financing and Homebuilding business from the Company. Forward-looking statements made by the Company in this release, or elsewhere, speak only as of the date on which the statements were made. Any forward-looking statements should be considered in context with the various disclosures made by us about our businesses, including the Risk Factors described in our 2007 Annual Report on Form 10-K and our other filings with the Securities and Exchange Commission. The Company disclaims any duty to update its forward-looking statements as of any future date.

Photo: http://www.newscom.com/cgi-bin/prnh/20020429/FLM010LOGO-cAP Archive: http://photoarchive.ap.org/PRN Photo Desk, photodesk@prnewswire.com

Walter Industries, Inc.

CONTACT: Investors: Mark H. Tubb, Vice President - Investor Relations,+1-813-871-4027, mtubb@walterind.com, Media: Michael A. Monahan, Director -Corporate Communications, +1-813-871-4132, mmonahan@walterind.com

Web site: http://www.walterind.com/

Source: PRNewswire-FirstCall

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