MARKHAM, ON, Nov. 20, 2002 -- PLM Group today reported net earnings of $0.5 million (2 cents per share basic and diluted) for the three months ended September 30, 2002 - the Company's ninth consecutive profitable quarter. Net earnings for the third quarter a year ago (as previously restated to conform to new CICA recommendations for foreign currency translation) were at a breakeven level of $44,000 (0 cents per share basic and diluted). These results were achieved while also repaying long term debt by $5.1 million during the quarter. This brings the total long term debt reduction for the year to $8.4 million. Despite very challenging market conditions, at $23.6 million, sales in the third quarter of 2002 were only fractionally below sales of $24.0 million in the comparable quarter a year ago. To be consistent with the current year's presentation, the Company has reclassified its 2001 results to segregate the contribution made by a divested operation - a Cincinnati-based packaging and fulfillment operation, sold effective January 1, 2002. At the time of divestiture, PLM America had operating losses available to offset future operating income in the amount of $3.7 million. Since that time, the remaining operations in Cincinnati have generated a continuing income stream. In accordance with Generally Accepted Accounting Principles, PLM has recognized the estimated income tax saving that will occur as a result of applying the accumulated losses of PLM America against this income stream. Operating Performance The Company generated net earnings from continuing operations for the third quarter of 2002 of $0.5 million or 2 cents per share basic and diluted. This compares with income from continuing operations of $0.4 million or 1 cent per share basic and diluted in the third quarter of 2001. Third quarter 2001 results included a one-time gain on the sale of a surplus facility of $0.5 million. "This was a difficult quarter, across the board in all market sectors," said Barry Pike, Chairman and Chief Executive Officer, "but the PLM team worked very hard to secure business, serve customers effectively and manage expense levels. The result was another consecutive quarter of profitability. Most important, we made a major improvement in our balance sheet by retiring a $3.5 million debenture and repaying $1.6 million from the current portion of long term debt. This gives us an excellent financial footing for the future." Business Commentary and Outlook "The third quarter did not produce the kind of seasonal customer volumes our industry has come to expect," said Mr. Pike. "PLM fared well in the context of difficult market conditions in the quarter, but it's fair to say we're operating in recession-like conditions as far as customer spending on marketing and promotion is concerned. In this environment, PLM is simply concentrating on the basics: delivering value for customers, paying strict attention to costs and maximizing every dollar of revenue that comes in by trying to be very efficient and productive in all our operations." "Based on what we saw in the tail end of the third quarter, we must anticipate continued market weakness in the fourth quarter," said Dave Stuart, President and Chief Operating Officer. "October was ahead of September in terms of sales volumes and profit, that's to be expected based on traditional seasonality. The issue is, the ramp up was not as significant as it usually is and certainly not as pronounced as we would have expected. Consequently, our stance must remain cautious - as it has for most of this year - but we remain well equipped and well positioned to react if conditions improve rapidly." Said Peter Bradley, PLM's Executive Vice President and Chief Financial Officer: "Our balance sheet gives us far more flexibility than ever to ride out current market conditions. What's more, PLM is in very good position relative to our capital needs. The capital investments we've made in the past few years have given us a strong, modern and efficient operational foundation - one that can respond effectively to rapid changes in client order patterns."