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American Reprographics Company reports 28% drop in revenues

Wednesday, February 24, 2010

Press release from the issuing company

Walnut Creek, CA, - American Reprographics Company

- Adjusted Annual EPS Fully Diluted: $0.38
- Annual Cash from Operations: $97.4 million
- 2010 Annual Forecast EPS: $0.15 to $0.30
- 2010 Annual Forecast Cash from Operations: $65 million to $80 million

American Reprographics Company (the "Company"), the nation's leading provider of reprographic services and technology, today reported its financial results for the full year and fourth quarter ended December 31, 2009.

"We are glad to put 2009 behind us. In spite of the challenging conditions the company performed well," said K. "Suri" Suriyakumar, Chairman, President and CEO. "The extraordinary efforts we made to right size the company and contain costs in late 2008 and early 2009 allowed us to battle through a very difficult year and come out of it vigorous and healthy. We were able to meet our financial obligations comfortably, make investments in several new products and services to enhance our revenue stream, and reduce our debt obligations by more than $85 million despite a decline in annual sales of more than 28%."

Jonathan Mather, Chief Financial Officer, said, "While we did not see an upturn in construction-related business during the fourth quarter, we were happy to see slightly stronger sales than we anticipated. Aggressively managing the company to control costs provided us the flexibility and focus to ensure we made the most of every bit of activity in the market."

Revenue for the year ended December 31, 2009 was $501.6 million, compared to $701.0 million for the year ended December 31, 2008, a 28.5% decline year-over-year. The Company's gross margin for the year ended December 31, 2009 was 35.5%, compared to 40.7% for the year ended December 31, 2008. Adjusted net income for 2009 was $17.2 million, or $0.38 per diluted share, excluding the effects of previously disclosed one-time charges related to the Company's annual goodwill impairment assessment, an impairment of long-lived assets, and costs associated with an amendment to our credit agreement and interest rate swap transaction. Adjusted net income for 2008 was $59.0 million, or $1.30 per diluted share excluding the goodwill impairment charge in the fourth quarter of 2008. Net cash from operating activities in 2009 was $97.4 million, compared to $127.3 million in 2008.

Net revenue for the fourth quarter of 2009 was $111.7 million, compared to $154.0 million for the fourth quarter of 2008, a decrease of 27.5%. The Company's gross margin for the fourth quarter of 2009 was 32.2%, compared to 36.7% for the same period in 2008. Adjusted net income for the fourth quarter of 2009 was $0.4 million, or $0.01 per diluted share, adjusted to exclude one-time charges noted above. This compares to adjusted net income for the fourth quarter of 2008 of $6.5 million, or $0.14 per diluted share, excluding the goodwill impairment charge in the fourth quarter of 2008, as noted above.

American Reprographics Company anticipates annual earnings per share in 2010 to be in the range of $0.15 to $0.30 on a fully-diluted basis, and annual cash flow from operations in the range of $65 million to $80 million.

Teleconference and Webcast
American Reprographics Company will host a conference call and audio webcast today at 2:00 P.M. Pacific Time (5:00 P.M. Eastern Time) to discuss results for the Company's fourth quarter and full year 2009 and business outlook for the first quarter 2010.

A replay of this call will be available approximately one hour after the call for seven days following the call's conclusion.

Forward-Looking Statements
This press release contains forward-looking statements that are based on current opinions, estimates and assumptions of management regarding future events and the future financial performance of the Company. Words such as "anticipates," "projects," "expect" and similar expressions identify forward-looking statements and all statements other than statements of historical fact, including, but not limited to, any projections regarding earnings, revenues and financial performance of the Company, could be deemed forward-looking statements. We caution you that such statements are only predictions and are subject to certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. Factors that could cause our actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, the current economic recession and downturn in the architectural, engineering and construction industries specifically; our ability to streamline operations and reduce and/or manage costs; competition in our industry and innovation by our competitors; our failure to anticipate and adapt to future changes in our industry; our failure to take advantage of market opportunities and/or to complete acquisitions; our failure to manage acquisitions, including our inability to integrate and merge the business operations of the acquired companies or failure to retain key personnel and customers of acquired companies; our dependence on certain key vendors for equipment, maintenance services and supplies; damage or disruption to our facilities, our technology centers, our vendors or a majority of our customers; and our failure to continue to develop and introduce new services successfully. The foregoing list of risks and uncertainties is illustrative but is by no means exhaustive. For more information on factors that may affect our future performance, please review our periodic filings with the U.S. Securities and Exchange Commission, and specifically the risk factors set forth in our most recent reports on Form 10-K and Form 10-Q. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.




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