CPAC, INC. REPORTS SECOND QUARTER
AND SIX MONTH RESULTS

LEICESTER, New York, October 28, 1997 – CPAC, Inc. (Nasdaq NNM: CPAK) today reported second quarter and six month results for the period ended September 30, 1997. The Company’s second quarter performance was in line with expectations released on October 2, 1997.

CPAC, Inc. sales for the quarter were $27.8 million, versus $24.9 million last year. Net income was $1.97 million or $0.27 per share compared to $2.26 million or $0.31 per share last year. Management cited increased competition in the Imaging industry and the fifteen day UPS strike as the major factors contributing to the decline in earnings.

On a segment basis, sales in Cleaning and Personal Care were up 32% to $16.4 million, versus $12.4 million, due primarily to the July 23, 1997 acquisition of certain assets of IVAX Industries. Operating income was $1.89 million compared to $2.13 million last year. Higher delivery costs and lost sales as a result of the UPS strike negatively affected earnings in this segment. On a consolidated basis, the per share impact of the three week strike was $0.03.  

Sales in the Imaging markets were $11.4 million versus $12.5 million last year, due to increased competition. Operating income of $1.39 million compared to $1.76 million last year was a result of pricing pressure and unfavorable foreign exchange rates.

For the six month period, CPAC, Inc. sales were up 5% to $49.8 million versus $47.4 million last year. Net income was $3.65 million or $0.50 per share, compared to $4.08 million or $0.55 per share last year.

Cleaning and Personal Care segment sales were up 14% in the first half of the year to $27.7 million from $24.4 million one year ago, again reflecting approximately two months of additional sales from the recent acquisition. Operating income was $3.64 million compared with $4.34 million last year due to absorption of higher costs in the second quarter.

Imaging segment sales for the six month period were $22.1 million versus $23.0 million. Operating income was $2.29 million compared with $2.75 million last year.

Commenting on the Company’s results for the first half of the year, CPAC, Inc. Chief Executive Officer Thomas N. Hendrickson, said, "The increase in sales in the second quarter and for the six months reflects progress toward our strategic initiative of expanding the Cleaning and Personal Care side of our business through brand acquisitions. The purchase of certain portions of IVAX Industries, resulting in the newly formed Cleaning Technologies Group, increased the Cleaning and Personal Care segment of our business on an annual basis by $25 million – now weighting CPAC’s business mix 60% Cleaning and Personal Care, and 40% Imaging. This represents a fundamental shift from 1994 when our entire focus was in the Imaging marketplace."

Relative to costs, Mr. Hendrickson said, "We have focused our attention on reducing operating costs and will announce expense reduction initiatives within the next 90 days. To increase sales in the Imaging segment, CPAC will remain focused on international growth opportunities through joint ventures, partnerships, and other strategic alliances."

Founded in 1969, CPAC, Inc. owns The Fuller Brush Company in Great Bend, Kansas, as well as five imaging chemical facilities in the U.S. and Europe. In July, 1997, the Company acquired a portion of IVAX Industries with $25 million in sales, and formed the Cleaning Technologies Group as a division of Fuller Brush. CPAC has over 250 registered trademarks for chemical and non-chemical products in the cleaning and personal care industry and imaging market. Shares are traded over the Nasdaq National Market System under the ticker symbol "CPAK." Additional information is available on the Company's website (www.cpac-fuller.com).

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 filings with the Securities and Exchange Commission.

(UNAUDITED)