MISSISSAUGA, Ontario & STAMFORD, Conn.--July 24, 2002--Moore Corporation Limited today announced improved results for the second quarter and first half ended June 30, 2002. For the second quarter of 2002 the company reported GAAP (Canadian Generally Accepted Accounting Principles) earnings of $15.2 million, or $0.13 per diluted share. This compares favorably to a GAAP net loss of $60.4 million, or $(0.68) per share for the same period in 2001, or a loss of $5.0 million, or $(0.06) per share on a normalized basis. Normalized results for 2001 exclude restructuring and other non-recurring charges of $55.4 million incurred during the second quarter last year. There are no restructuring or restructuring-related charges in the 2002 results presented. Management believes normalized 2001 results are indicative of underlying operations and provide investors with a better means of comparing 2002 results. As required by the new accounting standards relating to goodwill and other intangible assets, effective January 1, 2002, goodwill is no longer amortized. On a comparable basis, second quarter 2002 earnings would have been $0.5 million lower or $14.7 million had the goodwill amortization expense been recorded. The company's second quarter 2002 GAAP income from operations was $22.7 million. This compares favorably to a GAAP operating loss of $51.5 million for the same period last year or income from operations of $3.9 million on a normalized basis. The improvement in income from operations was a result of continued focus on cost containment, productivity enhancements, waste reduction initiatives and operational efficiencies. EBITDA (operating income plus depreciation and amortization) increased to $45.2 million in the second quarter 2002 versus normalized EBITDA of $32.8 million in the same period last year as the company continued to generate strong cash flow. The company's free cash flow (EBITDA less cash paid for interest, taxes, dividends, and capital expenditures) continued to show dramatic improvement as the company generated positive free cash flow in the second quarter 2002 of $33.8 million versus normalized free cash flow of $13.2 million in the second quarter 2001. This marks the sixth consecutive quarter of significantly improved free cash flow as management continued its intense focus on cash generation and cash management. Net sales for the second quarter were $499.8 million compared to $532.5 million in 2001. The revenue decline resulted from the fourth quarter 2001 divestiture of Phoenix; the decision to exit certain unprofitable products in the Forms and Labels business; and the devaluation of certain foreign currencies and was offset slightly by the acquisition of the Document Management Services business of IBM Canada Ltd. and The Nielsen Company. For the six months ended June 30, 2002, the company reported GAAP earnings of $27.7 million, or $0.24 per diluted share. This compares favorably to a GAAP net loss of $261.8 million, or $(2.96) per share for the same period in 2001, or a loss of $12.2 million or ($0.14) per share on a normalized basis. Normalized results for 2001 exclude restructuring and other non-recurring charges of $ 288.6 million incurred during the first half of last year. Operating income in the first half of the year improved by $325.3 million to $44.5 million on a GAAP basis and increased $40.0 million on a normalized basis compared to the same period last year. As a result of the new accounting standards, goodwill amortization was not recorded in the first six months of 2002. For the first half of 2002, earnings would have been $1.1 million lower or $26.6 million had the goodwill amortization expense been recorded. The company's free cash for the first six months of 2002 was $68.5 million versus normalized free cash flow of $16.9 million in the same period last year. EBITDA for the first six months of 2002 was $89.2 million, an increase of $27.1 million or 44% versus normalized EBITDA of $62.1 million for the same prior year period. Revenues for the first half of 2002 were $1.03 billion compared to $1.11 billion in 2001 due to the factors discussed above. Robert G. Burton, Chairman, President and Chief Executive Officer stated: "I am pleased to report that the company delivered another quarter of substantial operating improvement and strong cash flow generation. It is becoming very clear that the efforts we have undertaken over the past eighteen months are beginning to yield significant results. Our mix of businesses and our "one-stop-shopping" sales platform have allowed us to perform very well despite a difficult economic environment. I am very proud of the results our employees have produced. While we still have a long way to go to achieve the company's full potential, we have come a long way in a short period of time. The Moore Team continues to perform in a challenging marketplace." Mr. Burton continued: "In light of an extremely challenging economic environment, we continue to take a hard look at costs across all of our businesses. We will continue to consolidate back office functions as well as continue to leverage our size with suppliers by driving purchasing volume to a few strategic business partners. I remain committed to constantly lowering our overhead costs and we are still very focused on improving our operating margins and becoming the low cost, "one-stop-shopping" solution for our customers." Mr. Burton concluded: "I continue to be very excited about the improvement that has been made in regard to cash flow and working capital management. We have intensely focused on improving our DSO's, inventory turns, capital expenditures, as well as the control of cash. All of these efforts are resulting in a dramatic turnaround in free cash flow. We will continue to put these funds to use by paying down debt, growing the business through acquisitions and capital investments and buying back company shares in accordance with the previously announced share repurchase program, in each case depending on market conditions. I remain very optimistic regarding the prospects for our business. Moore continues to win in our market segments by bringing great quality and service levels to our customers. As we put the front half of 2002 behind us, I can assure you that we are intensely focused on delivering the back half of the year. We had a good second quarter; our third quarter looks promising, and we remain comfortable with the targets we've communicated for the full year." Summary of Second Quarter Results * Sales in the second quarter 2002 of $499.8 million compared to sales of $532.5 million in the second quarter 2001. * Income from operations of $22.7 million in the quarter, compared to normalized income from operations of $3.9 million for the same period in 2001. * Net income for the second quarter 2002 was $15.2 million or $ 0.13 per diluted share compared to a normalized net loss of $5.0 million or $(0.06) per share for second quarter 2001. * Free cash flow of $33.8 million versus normalized free cash flow of $13.2 million in the same prior year period. * EBITDA of $45.2 million versus normalized EBITDA of $32.8 million in the same period last year. * As a result of the new accounting standards, $0.5 million of goodwill amortization expense was not recorded in the second quarter of 2002. Summary of First Half Results * Sales in the first half of 2002 of $1.03 billion compared to sales of $1.11 billion for the same period in 2001. This represents a 99% achievement of Moore's six month revenue budget. * Income from operations of $44.5 million for the first six months of 2002 compared to $4.5 million of normalized income from operations for the first six months of 2001. * Net income for the first six months of 2002 was $27.7 million compared to a normalized net loss of $12.2 million for the same period last year. * Free cash flow of $68.5 million versus normalized free cash flow of $16.9 million for the same period last year. * EBITDA of $89.2 million compared to normalized EBITDA of $62.1 million in the same period last year.