Hauppauge, NY (August 14, 2000) – Disc Graphics, Inc. (NASDAQ Small Cap Symbol: DSGR) today announced results for the second quarter ended June 30, 2000. Disc Graphics, a national folding carton and specialty printing company, increased its 2000 second quarter revenues by more than 6.0% to $15,595,000 compared with revenues of $14,708,000 in the second quarter of 1999. The net loss for the second quarter was $1,291,000, or $.23 per share based on 5,518,262 diluted shares, compared to net income of $700,000, or $.13 per share based on 5,543,358 diluted shares in the second quarter of 1999. Revenues increased 8.7% in the first six months of 2000 to $32,168,000 compared with revenues of $29,603,000 for the first six months of 1999. The net loss for the first six months was $1,837,000, or $.33 per share based on 5,518,284 diluted shares, compared to net income of $1,001,000, or $.18 per share based on 5,549,510 diluted shares for the first six months of 1999. The Company’s financial results for the second quarter were affected by the continued integration of the business of Contemporary Color Graphics, Inc. (“CCG”), production inefficiencies associated with the expansion of its Hauppauge facility to accommodate the recently acquired large format equipment, a 13% increase in raw material costs which can only be partially passed on to customers, the impact of lower than anticipated sales for the quarter, and hard and soft costs associated with the implementation of ISO 9001 procedures. Don Sinkin, Chairman and Chief Executive Officer, said, “Our plan for the long term growth and financial health of Disc Graphics included a significant expansion in manufacturing capability by investing in large format equipment (i.e., 56-inch high speed die cutter and 56-inch six color press).  While we fully expected expansion to result in temporary inefficiencies, they have lasted somewhat longer than anticipated.  Nevertheless, we believe that the addition of the large format equipment will position Disc to make a major move forward.  The expansion difficulties, combined with less than anticipated contribution from our CCG acquisition and lower than anticipated year-to-date sales, have made the first six months of the year very difficult.  The Company has responded quickly and decisively by eliminating the operating costs of CCG, completing the expansion of the Hauppauge facility, and aggressively pursuing new markets to fill our expanded capacity.  The current situation is not expected to turn around quickly.  However, we believe the Company’s actions will result in Disc becoming a stronger competitor in the future and the achievement of our objectives for the shareholders and employees of Disc.”