PRIMESOURCE CORPORATION ANNOUNCES FOURTH QUARTER
Monday, February 26, 2001
Pennsauken, NJ (February 26, 2001)…PrimeSource Corporation (Nasdaq NM: PSRC), the leading distributor to the printing and publishing industry and a leader in digital print technology, today announced fourth-quarter and year-end results for 2000. For the fourth quarter, the Company recorded sales of $136.3 million. Sales for the similar period in 1999 were $140.5 million. Net income for the fourth quarter was $1.2 million, or $.19 per diluted share, compared to $1.4 million, or $.22 per diluted share, for 1999. Sales and earnings were less than anticipated for the quarter, due to an overall softness in the printing industry. In addition, Canopy, LLC, our new joint venture with Xeikon, had a $.07 per share negative impact on earnings for the quarter. For the full year, PrimeSource had sales of $547.6 million and net income of $5.1 million, which approximated 1999’s sales and earnings. Earnings per diluted share were $.79, on 127,000 fewer shares, versus $.78 per diluted share for 1999. Revenues, cost of sales and SG&A expenses for all periods were restated to comply with revised accounting standards, requiring freight billed to customers be shown as revenue and freight out expense to be included in cost of sales. Previously, freight out expense net of freight billed was included in SG&A. This accounting change has no effect on the Company’s current or historical net income or net income per share. Commenting on these results, James F. Mullan, Chairman of the Board, President and CEO, said, “ The softness of the industry, which we began to experience during the third quarter, continued throughout the remainder of 2000. Considering this softness, as well as our investment to start up operations of Canopy, LLC, the Company performed well.” Mr. Mullan continued, “We continued to aggressively manage our investment in receivables and inventories, and our cash flow remained strong. Over the past two years, we have reduced total debt by 30%, while continuing to invest in digital printing technology.” Mr. Mullan concluded, “We look forward to another positive year for PrimeSource. We anticipate that our performance will strengthen as the year progresses, reflecting improving conditions in our marketplace and the continuing acceptance of digital printing.” PrimeSource Corporation is the leading supplier and digital workflow integrator to the nation’s fourth largest industry—printing and publishing.