Cone Mills Announces Initiatives

Cone Mills Announces Initiatives Cone Mills Corp., Greensboro, N.C., announced two initiatives
aimed at improving its earnings. The first initiative is the expansion of the Parras Cone
joint-venture denim plant in Mexico. Cone Mills and Compania Industrial de Parras, S.A., have
agreed to expand Parras Cones production capacity by 11 million yards, or 35 percent, for a capital
investment of approximately $18 million. John L. Bakane, CEO, Cone Mills, said, Over the past five
years, sourcing of denim jeans for U.S. markets from Mexico has more than doubled. The Parras Cone
expansion should allow us to keep up with this substantial growth in demand. In addition, since
Parras Cone was originally constructed with the infrastructure in place for this expansion, this
move should further improve the versatility and cost effectiveness of the plant.The second
initiative involves the shutdown of Cones Marion, S.C.-based Raytex top-of-bed fabrics plant.
Bakane commented on the closing of the plant by saying, Raytex did not fit our vision for the
future Cone Mills because it did not have a leadership position in a market dominated by large
vertical bedding manufacturers. In addition, the closure of Raytex will eliminate significant
operating losses, which for the first three quarters of 2000 have totaled $4.3 million, or $0.11
per share, on sales of $14.1 million.According to Bakane, these two initiatives are the result of
continued progress toward the strategy we have been implementing over the past two years.
February 2001