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LEICESTER, N.Y., Aug. 11, 1997 -- At its
annual shareholders meeting held August 6th in Mt. Morris, N.Y., CPAC, Inc. (Nasdaq: CPAK)
highlighted the Company's recent acquisition and plans for future growth.
President and Chief Executive Officer, Thomas N. Hendrickson stated, "The July 22
purchase of IVAX Industries' commercial cleaning chemicals business (now called Cleaning
Technologies Group) positions CPAC as a leader in the commercial/janitorial cleaning
product marketplace. This acquisition allows CPAC the opportunity to leverage its existing
low-cost manufacturing capabilities in Great Bend by adding capacity -- initially in the
form of aerosols, mops, brooms and brushes. Additionally, we enhance our marketing
infrastructure by adding more than thirty experienced sales professionals which will allow
CPAC to focus on expanding its market share."
Mr. Hendrickson continued, "Sales for the full fiscal year ending March 31, 1998 will
be about $113 million, with approximately $25 million coming from commercial/janitorial
cleaning products. The acquisition may negatively impact second quarter earnings due to
the absorption of acquisition related costs. However, moving forward we believe the
acquisition will be accretive to earnings by the fourth quarter of fiscal 1998 and
beyond."
Mr. Hendrickson stated that, "Acquisitions are the primary method by which CPAC will
continue to meet desired double-digit sales growth. We are currently considering
candidates in both imaging and direct selling."
Stephen R. Tafaro, President of CPAC's newly formed Cleaning Technologies Group, discussed
plans to integrate the acquisition as a division of Fuller Brush, CPAC's cleaning and
personal care subsidiary. "The Cleaning Technologies Group combines Fuller's
commercial cleaning division with the former IVAX Industries' Franklin and Masury-Columbia
business. This combination allows us to capitalize on our strong brand identity through
over 500 nationwide distributors, and to focus on expanding alliances with national
distributors in the retail, supermarket, and healthcare segments," he said. Mr.
Tafaro continued, "In the next eight months we intend to transition the aerosol
production and several other administrative functions to the Fuller facility.
Additionally, we also plan to launch two new floor care finishes, as well as incorporate
Fuller mops, brooms and brushes into the Franklin distribution network. Our goal is to
become the largest one-stop supplier in the commercial/janitorial cleaning market."
CPAC also announced that all management proposals were passed by shareholders, including
an amended stock option plan.
CPAC, Inc. manufactures and markets household and commercial cleaning and personal care
products through its Fuller Brush subsidiary. The Company also produces imaging solutions
and pollution control equipment for the global imaging market. CPAC, Inc. shares are
traded over the Nasdaq National Market System under the ticker symbol "CPAK."
Except for the historical matters contained herein, statements in this press release are
forward-looking and are made pursuant to the safe harbor provisions of the Securities
Litigation Reform Act of 1995. Investors are cautioned that forward-looking statements
involve risks and uncertainties which may affect CPAC's business and prospects, including
economic, competitive, governmental, technological and other factors discussed in CPAC's
filing with the Securities and Exchange Commission.
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