August 22, 2006 -- Bowne & Company, Inc. (NYSE: BNE) announced their second quarter results recently. Revenue was $260.3 million, compared to $197.6 million in the second quarter of 2005. Earnings from continuing operations doubled in the second quarter to $10.4 million from $5.4 million in the same period last year. Net income was $6.5 million, or $0.19 per diluted share, compared to $2.4 million, or $0.07 per diluted share, in the same quarter a year ago. Year-to-date, revenue was up 30% to $466.0 million from $357.6 million reported in the first six months of last year. For the six months ended June 30, 2006, income from continuing operations was $11.9 million compared to $8.3 million last year. Earnings per diluted share, including discontinued operations, were $0.25 for the six month period compared to $0.14 in 2005. Contents of this Summary * Quarter Highlights * Segment Performance * Guidance * Raine Radar * Q & A Quarter Highlights • On August 7, 2006 Bowne named John J. Walker as its senior vice president and chief financial officer. Walker will start in September. • Cash used in operations for the quarter ended June 30, 2006 increased $24 million to $56 million, from net cash used in operations of $32 million in 2005. • Days sales outstanding increased to 73 days in June 2006 from 66 days in June 2005. The increase in DSO and cash used in operations was primarily the result of higher levels of activity during the first half of 2006 than the comparable prior year period. Segment Performance Financial Print Segment The segment reported second quarter revenue of $229.9 million, compared to $188.4 million for the same period last year, an increase of 22.0%. Transactional revenue increased 45.4% due to increased capital market activity. Non-transactional revenue, which includes mutual fund and compliance reporting revenue, increased 10.8% over 2005. Segment profit for the quarter as a percentage of revenue was 18.7%, compared to 16.5% for the same period last year. Marketing & Business Communications The 2006 results include the acquisition of the marketing and business communications division of Vestcom International, which was completed in January 2006. MBC reported revenue of $30.3 and $69.7 million for the second quarter and year-to-date, respectively. Segment profit for the quarter was a loss of $2.5 million and $0.3 million year-to-date, primarily as a result of costs associated with the acceleration of the integration of its New Jersey operations. During the first half of the year, MBC signed or renewed 19 contracts. Discontinued Operations In keeping with its strategy of focusing on its core businesses, the company reclassified DecisionQuest and JFS Litigators Notebook(R) (JFS), which are being held for sale, as discontinued operations. The 2006 results from discontinued operations include a $9.9 million gain on the sale of CaseSoft (a joint venture investment held by DecisionQuest which was sold in May 2006), and a $13.3 million goodwill impairment charge related to DecisionQuest. The 2005 results from discontinued operations include DecisionQuest, JFS, DecisionQuest Discovery Services (which was sold in January 2006) and Bowne Global Solutions (which was sold in September 2005). Guidance The company did not give any specific guidance for the third quarter. Bowne reaffirmed the guidance it provided earlier for the full year 2006. Raine Radar As predicted last quarter, cost cutting measures helped improve earnings in the Q2. The increase in capital market activity which drove the financial print segment was also a huge part of the improved results this quarter. MBC results were a little disappointing, but should improve. Q & A 1. The company expects to be able to extract between $50-$60 million in potential cash from working capital. 2. The company’s litigation solution is being marketed, however it is still in negotiations and being finalized. 3. Net cash used in operating activities for the first half of 2006 was $56.6 million compared to $32.2 million for the first six months of 2005.