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RR Donnelley Opens Large, Fully-Automated Distribution Facility in York, PA

Press release from the issuing company

WILLOWBROOK, Ill., June 27, 2003 - RR Donnelley Logistics, a leader in print, mail and package distribution, has opened its new 670,000 square foot facility in York, Pa. The move is representative of the company's business strategy to enhance its consolidation and distribution network, expanding capacity to support rapidly increasing demand for its services, while continuously improving its service offering. The new facility will process all of RR Donnelley Logistics' customer package volumes originating from and destined for the Northeastern region of the United States, allowing customers to see their home delivery service improve by up to two days within the region, and one day for the balance of the country. In addition, the facility will handle the consolidation and distribution of catalogs, books, magazines and direct mail. By leveraging the facility's package sortation equipment and the package volumes already going to postal facilities, RR Donnelley Logistics will be the first in the industry with a highly-automated, highly efficient co-palletization capability, which will further improve service for the company's print customers. In addition to delivering significant service improvements, the new facility increases package processing capacity by approximately 40 million packages per year. This additional capacity is necessary to service RR Donnelley Logistics' growing list of business-to-consumer package shippers located in the region. The facility is equipped with a highly efficient induction system, integrating the latest scanning technology with a high-speed automated sortation system that generates increased efficiency and throughput. Packages will move through the facility in as little as 10 minutes from inbound to outbound truck. In addition, the automated facility dramatically reduces the physical demands on the company's employees, creating a more productive work environment. "The demand originating from and destined to the Northeast continues to grow, and our capabilities need to grow ahead of demand. Our investment in this new facility represents our comittment to providing our customers the best service levels and delivery performance, enabling them to meet their consumers' demands," said John Campanelli, RR Donnelley Logistics president. "We are also committed to providing our employees safe, secure and comfortable working conditions." In addition to the company's print and package operations, the York facility will house Merchandise Management Services, an inventory order management and distribution service for merchandisers that require national distribution of high-volume, single item SKUs, and Lightweight ExpressTM, the company's express shipping program for time-sensitive packages under one pound. The facility will also support operations for SmartLabelTM, a merchandise returns service provided by Newgistics, a company in which RR Donnelley Logistics is an equity partner.