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X-Rite Announces 4Q Earnings: Net Loss of $2.7 Million

Press release from the issuing company

GRANDVILLE, Mich.--Jan. 30, 2002--X-Rite announced its financial results for the fourth quarter and year-ended December 29, 2001. The Company reported fourth quarter net sales of $20.1 million and net loss of $2.7 million, or 12 cents per share, compared with net sales of $28.0 million and net income of $3.4 million, or 15 cents per share for the same period last year. For the year-ended December 29, 2001, the Company reported net sales of $91.7 million and net income of $1.9 million, or 9 cents per share, compared with net sales of $103.4 million and net income of $12.4 million, or 58 cents per share for the year-ended December 30, 2000. The company stated that fourth quarter results, normally its strongest period, were significantly influenced by a global economic decline and several major customer postponements of capital equipment purchases. The company added that it believes its sales shortfall and weaker than anticipated earnings were not indicative of any permanent change in the markets it serves, or its product initiatives. The North American recession, complicated by unsettling world events, has negatively impacted global business conditions, particularly the capital goods market. Commenting on the year, Rich Cook, X-Rite, Incorporated's chief executive officer, said, "2001 was a challenging year for X-Rite. Although I am clearly disappointed in our results, I have great confidence in our business fundamentals, and I am encouraged by the many advances our business has made. In the face of extraordinary world events and economic uncertainty, we completed several important strategic actions that better position us for financial success in both good and bad economic times.'' Highlights for the year include: * The internally developed X-Rite ShadeVision(TM) System is now shipping, and offers the dental industry a new patient care tool. Our exclusive U.S. distributor, Sullivan-Schein Dental, is beginning to market the product this month, and we anticipate sales to be impacted the first half of 2002. Market acceptance has been positive, and we are actively promoting this system worldwide in anticipation of growing interest outside of the U.S. * We have joined forces with Suss Microtec, an international manufacturer of precision micro-electronics equipment to develop a system for improving optical testing of VCSEL (vertical cavity surface emitting laser) components at the wafer level for semiconductor manufacturers. * We have signed an agreement with Keithley Instruments, Inc. capitalizing on each company's expertise in measurementtechnologies for use in DWDM (dense wavelength division multiplexing) fiber-optic applications. The resulting product of this alliance enables datacom and telecom customers to measure 20 times greater power output from solid state lasers and DWDM sources. * We have constructed optical measurement systems for two major U.S. fabricators of LED (light emitting diodes) wafers and dies. The high brightness LED industry continues to expand in response to the demand for LEDs as replacements for traditional lighting products in the automotive, display, signal, architectural lighting and general illumination markets. * X-RiteColor Master, a newly developed core software platform, provides streamlined color management solutions for a variety of markets, including printing, plastics, coatings, paints, inks, textiles and related industries. This integrated technology product provides quality assurance, across instruments, software, and networks, in laboratories or on the production line. Offering a new level of commonality among X-Rite color solutions, it forms the basis for data sharing, networking and technology upgrades. Cook concluded, "We firmly believe that our products offer the right solutions for the markets we serve, and that the fundamental need for these products is unchanged. Although business conditions remain difficult, our pursuit of new growth markets is undeterred. X-Rite is poised to benefit from a rebounding global economy, and we continue to invest in the design, development and manufacture of products that satisfy the demands of our dedicated customer base, as well as attract a new array of customers in new markets.''