NEW YORK, NY-- May 12, 2008 -- Bowne & Co., Inc., a global leader in shareholder and marketing communications services, today announced profitable first quarter operating results in a difficult capital markets environment. The Company also announced additional cost reduction initiatives, the benefits of which will be realized in 2008 and beyond.

Revenue was $208.8 million in the first quarter of 2008 compared to $212.0 million in the first quarter of 2007, a decline of $3.2 million, or 2%. Operating income was $2.9 million in the first quarter of 2008 compared to $12.5 million in the same 2007 period. Income from continuing operations was $1.8 million, or $0.07 per diluted share, compared to $10.2 million, or $0.32 per diluted share, in the first quarter of 2007. Net income was $1.2 million compared to $10.7 million for the same period last year. Total diluted earnings per share, including discontinued operations, were $0.05 per share in the 2008 first quarter compared to $0.34 per share for the comparable period in the prior year.

In the first quarter of 2008, the Company generated gross profit of $71 million, with a 34% gross margin contribution, compared to $82 million and a 39% gross margin contribution in the prior year period. Segment profit was $12.6 million in the first quarter of 2008 compared to $21.9 million in first quarter of 2007. Segment profit margin in the first quarter of 2008 was 6.1%, compared to 10.3% in the first quarter of 2007.

Pro forma income from continuing operations totaled $3.6 million in the first quarter of 2008 compared to $7.9 million in the first quarter of last year, resulting in diluted earnings per share of $0.13 in the first quarter of 2008 compared to $0.25 in the comparable 2007 period. (See page 9, Pro Forma Supplemental Income Information for a reconciliation of these non-GAAP financial measures to our Condensed Consolidated Statements of Operations.)

"We earned $71 million in gross profit during the first quarter despite the significant downturn in the capital markets," said David J. Shea, Chairman and Chief Executive Officer. "We believe our recent strategic acquisitions, combined with our ongoing efforts to diversify our revenue stream and reduce costs, will benefit us as we manage through this challenging environment. We are confident that pursuing this strategy will significantly improve our profitability in the second half of this year and beyond."

Additional comments on the operating results in the first quarter of 2008 are provided below.

Revenue:

Capital markets services revenue, formerly referred to as transactional revenue, was $50.3 million in the first quarter, which is $12.0 million, or 19%, lower than the comparable 2007 period, and the lowest quarterly level since 2003. This decline is directly related to the overall decline in capital market activity, with filings decreasing 33% and priced IPOs decreasing 54%, as compared to the first quarter of 2007. Overall capital market activity in the first quarter of 2008 was at its lowest level in the past six years. The decline in the Company's capital markets services revenue was partially offset by a $2.4 million increase in revenue from Bowne Virtual Dataroom(TM) (VDR). VDR revenue, which is now reported as part of capital markets services revenue, was $3.0 million in the first quarter of 2008 compared to $0.6 million in the comparable quarter of 2007.

Shareholder reporting services revenue, which includes compliance reporting, investment management services and translations services revenue, increased 4%, or $4.1 million, to $105.5 million during the quarter ended March 31, 2008, compared to $101.5 million in the comparable quarter of 2007. Compliance reporting revenue increased approximately 5%, investment management services revenue increased 3% and translations services revenue increased 6%. Compliance reporting revenue increased as a result of the addition of new clients, including revenue from our Pure Compliance® service offering. The increase in revenue from investment management services is primarily the result of revenue gained through the acquisition of GCom² Solutions, Inc. (GCom) in February 2008.

Marketing and business communications services revenue increased $6.7 million, or 18%, to $43.5 million during the first quarter of 2008, compared to $36.7 million in the same period last year. The increase in revenue is primarily due to revenue contributions from the acquisition of Alliance Data Mail Services (Alliance).

Together, the acquisitions of Alliance and GCom contributed approximately $10.6 million in revenue during the first quarter. As previously noted, diversifying Bowne's revenue stream has been a strategic goal during the past several years and the revenue contributions from the acquisitions of Alliance and GCom will continue to support this objective.

Segment Profit: The decline in revenue from capital markets is the primary driver of the $9.3 million reduction in segment profit in the first quarter of 2008. Additionally, the Company is in the early stages of integrating the strategic acquisitions it made in the fourth quarter of 2007 and the first quarter of 2008. The Company expects it will begin to realize the benefits of synergies and cost reductions related to these acquisitions in the third quarter of 2008 and should realize annualized cost savings of approximately $13 million from the integration of these two businesses. The segment profit reported in the first quarter of 2008 includes a loss of approximately $0.4 million from the operations of these acquired businesses.

As previously announced, the Company completed two strategic acquisitions to date in 2008.

On February 29th, the Company acquired the assets and operating business of GCom for $45 million in cash. GCom is a leading provider of proprietary financial administration and reporting software and solutions to the global investment management industry. With annual revenue of approximately $25 million, GCom offers a robust, innovative suite of scalable software products that provide investment administrators easy-to-use, intuitive solutions, while addressing their reporting and shareholder communication challenges. GCom operates in the United States, the United Kingdom, Ireland and Luxembourg.

On April 9th, the Company acquired the digital print business of Rapid Solutions Group ("RSG") for $14.5 million in cash. RSG is a provider of end-to-end solutions for marketing and business communications clients in the financial services and health care industries, enabling Bowne to further expand its presence in those verticals. RSG has annual revenue of approximately $40-$45 million. Its operations in Melville, New York and Mt. Prospect, Illinois will be integrated into Bowne's distributive print platform.

The annual revenue from the acquisitions completed in 2008, coupled with the acquisition of Alliance completed in November 2007, is expected to result in revenue of approximately $90-$100 million annually. The revenue from these acquisitions supports the Company's strategy to diversify its revenue and decrease its dependency on the capital markets. They also provide the Company with the ability to realize significant synergies and cost savings by integrating these three businesses into Bowne's existing operations during the second quarter. It is estimated that these acquisitions will generate incremental annualized segment profit of approximately $25-$30 million.

Bowne announces $50 million in annualized cost reductions.

The Company continually reviews its business, manages its costs and aligns its resources with market demand, especially in light of the volatility of the capital markets and the resulting variability in capital markets revenue. As a result, the Company took several steps over the last several years to reduce fixed costs, eliminate redundancies and better position the Company to respond to market pressures or unfavorable economic conditions.

Bowne announced today that it is implementing initiatives to target $50 million in annualized cost reductions in 2008 as part of its continued focus on improving its cost structure. The cost reductions include the elimination of a total of approximately 650 positions, or approximately 15% of the Company's total headcount. These cost reductions, which the Company expects to substantially complete in the second quarter, result from the following actions:

--  a reduction in the Company's workforce, resulting in annualized cost

    savings of approximately $21 million.

--  the continuation of the 2007 cost reduction initiatives that are

    underway, resulting in approximately $9 million of annualized cost savings.

--  the integration and transition of recently acquired businesses,

    resulting in an estimated $20 million of annualized cost savings.

Each of these three initiatives is further described below.

During the second quarter of 2008, the Company initiated a reduction in force as it continues to rationalize its resources and in response to the downturn in capital market activity. This includes the elimination of approximately 250 positions, excluding the impact of staff reductions associated with the integration of recent acquisitions. The reduction in workforce is enterprise-wide and includes a broad range of functions as well as the continued consolidation of manufacturing operations to create a robust platform that includes digital and offset printing, binding, mail distribution and fulfillment capabilities. The annual cost savings as a result of these efforts are expected to approximate $21 million, with the savings in 2008 expected to approximate $11 million. Bowne estimates that the restructuring charges related to these actions will result in a second quarter 2008 pre-tax charge of approximately $8 to $9 million.

The cost savings measures implemented in 2006 and 2007 were designed to eliminate $35 million in costs over a three-year period. In the first two years of the three-year program, approximately $28 million in annual cost reductions were achieved. In 2008, Bowne expects to eliminate an additional $9 million in costs, which are estimated to result in annual savings of approximately $37 million over the three-year period, exceeding the original target. These actions are a continuation of initiatives put into place in 2007, including the full year benefit of the conversion to a cash balance pension plan, the reduction in our annual lease cost at our corporate headquarters and the integration of certain manufacturing facilities completed in the second half of 2007.

In addition, the Company continues to work on the integration of Alliance, GCom and RSG, and should realize approximately $20 million in annual cost savings, with 2008 savings of approximately $12 million. The cost savings primarily represent reductions in force of approximately 400 positions and the consolidation of manufacturing facilities. These cost reduction efforts are already underway, and the majority should be substantially completed by the end of the second quarter of 2008.

Balance Sheet and Cash Flow: For the quarter ended March 31, 2008, cash and marketable securities decreased $73.1 million from December 31, 2007. This decline reflects the funding of $47.1 million related to the acquisition of GCom in February 2008, $3.9 million in capital expenditures and the normally high seasonal working capital usage in the first quarter. Net cash used in operating activities was $36.4 million for the quarter ended March 31, 2008, compared to $10.5 million for the quarter ended March 31, 2007.

Average days sales outstanding improved to 67 days for the quarter ended March 31, 2008 from 68 days for the quarter ended March 31, 2007. Work-in-process inventory was $28.2 million at March 31, 2008 compared to $34.4 million at March 31, 2007. As of March 31, 2008 the Company had $21 million outstanding under its $150 million five-year senior, unsecured revolving credit facility that expires in May 2010.

Business Outlook: Given the volatility in the capital markets and the nature of the Company's business, it is not adjusting its annual guidance. This is consistent with the Company's policy of not adjusting annual guidance unless it believes the actual results will be materially outside the range provided. The Company expects overall operating performance will be in the range of the full-year guidance previously provided in March.

Forward-Looking Statements: The Company notes that forward-looking statements of future performance made in this release are based upon current expectations and are subject to factors that could cause actual results to differ materially from those suggested here, including demand for and acceptance of the Company's services, new technological developments, competition and general economic or market conditions, particularly in the domestic and international capital markets.

Bowne & Co., Inc. will hold its earnings conference call to review its 2008 first quarter results on Tuesday, May 13, 2008, at 11 a.m. Eastern Time. To join the Webcast, log on to http://www.bowne.com. To access the call via telephone, please dial (877) 407-8033 (domestic) or (201) 689-8033 (international), conference ID # 282957.