Pennsauken, NJ-- PrimeSource Corporation (Nasdaq NM: PSRC), the leading distributor to the printing and publishing industry and a leader in digital printing technology, today announced record sales for the third quarter and record sales and earnings for the first nine months of 2000. Sales for the third quarter reached a new high of $133.5 million, as compared to the $132.5 million for the same quarter last year. Digital press sales and traditional machinery sales showed positive growth, while supply and electronic prepress systems sales were less than anticipated. Net income for the third quarter was $1.14 million, which approximated the $1.17 million for last year's third quarter. Earnings per diluted share were $.18 for both quarters. Earnings for the quarter included a gain on the sale of a Seattle-based facility. Earnings were adversely affected by increased costs for the Company's new joint venture, Canopy LLC, start-up costs for a new branch in the Cleveland, Ohio marketplace, and increased interest costs. Record nine-month sales were $409.7 million versus $405.3 million for last year's comparable period. Net income was a record $3.9 million as compared to $3.7 million in 1999. Earnings per diluted share were $.60, a 7% increase over last year's $.56 per diluted share. Commenting on these results, James F. Mullan, chairman, president and chief executive officer, said, "Although we are pleased with the Company's record results for the first nine months of this year, we are disappointed that our supply and electronic prepress system sales were soft in the quarter, especially after the good performance of both in the first six months. We believe the issue with electronic prepress system sales was one of timing. A major trade show that occurred at the end of September delayed anticipated equipment installations to the fourth quarter. We also feel that supply sales for the rest of the year will meet expectations." Mr. Mullan continued, "In its first quarter of business operation, Canopy had a record level of press installations, and this pace is expected to continue through the fourth quarter. We believe that the creation of Canopy LLC, a joint venture between PrimeSource and Xeikon, positions us to capitalize on the anticipated rapid growth in digital printing." Mr. Mullan concluded, "We continue to aggressively manage our investment in receivables and inventories. Our cash flow continues to be strong. We have met our debt level goals, even with the additional investment in Canopy. Finally, we continue to focus on all aspects of the business and we believe our positive performance will continue through the remainder of the year." PrimeSource Corporation is the leading supplier to the nation's fourth largest industry-printing and publishing, as well as a leader in digital technology. PrimeSource provides more than 50,000 products from 500 manufacturers to over 30,000 customers. The Company has 32 locations throughout the United States.