CPAC, Inc. Announces Fourth Quarter and Full-Year Results;
Declares Quarterly Cash Dividend of $.07

LEICESTER, NY, June 7, 2001 – CPAC, Inc. (Nasdaq: CPAK) an international manufacturer and marketer of cleaning chemicals and related accessories, personal care products, and prepackaged imaging chemical formulations, today reported fourth quarter and full-year results for fiscal year 2001 ended March 31, 2001. Fourth quarter results were in line with company earnings guidance announced on May 2, 2001.

At its regular meeting on June 6, 2001, CPAC’s Board of Directors declared a quarterly cash dividend in the amount of $0.07 per share, payable on June 29, 2001 to shareholders of record at the close of business on June 20, 2001.

Consolidated fourth quarter net sales were $25.2 million compared to $28.6 million for the same period last year. Consolidated net income for the quarter was $724 thousand versus $1.6 million last year. Earnings per diluted share were $0.13 compared to $0.23 per diluted share last year, excluding a non-recurring tax refund of $0.04 per diluted share during the fourth quarter ended March 31, 2000.

Fiscal year 2001 consolidated net sales were $104.5 million compared to $112.1 million for fiscal year 2000. Net income for fiscal year 2001 was $4.6 million compared with $5.6 million for last year. Earnings per diluted share were $0.82 compared to $0.87 last year, excluding the non-recurring tax refund.

Net sales, cost of sales, and selling, administrative and engineering expenses for the years ending March 31, 2001 and March 31, 2000 were reclassified for the adoption of EITF (Emerging Issues Task Force) 00-10, "Accounting for Shipping and Handling Fees and Costs" which required the reclassification of shipping and handling costs billed to customers as revenue. This reclassification had no effect on operating income, net income, or earnings per share.

Fuller Brands Segment

Sales for the quarter were $14.6 million, down 10.3%. Due to the U.S. economic climate, end users were conservatively managing inventory levels, which negatively impacted most Fuller Brands product lines.  Cost of sales for the quarter represented 54.8% of sales versus 50.8% last year, largely due to the falloff in production volume and continued levels of fixed overhead and personnel.

Selling, administrative and engineering expenses for the quarter were 42.1% of sales versus 38.9% last year in the quarter. This increase is again a function of the decrease in sales for the quarter.

Fuller Brands operating income for the quarter was $308 thousand versus $1.5 million in the prior year.

Sales for the full year were $60.7 million, down 8.1%. Year-end cost of sales represented 51.7% of sales versus 51.5% last year, resulting in a gross margin of 48.3% of sales compared to 48.5% last year.  Despite weak fourth quarter sales, the full-year margin percentage is comparable to the prior year as a result of strong performance in the first half of the fiscal year.

Selling, administrative and engineering expenses for the year were 40.2% of sales versus 38.3% last year.  The Company continued to commit funding to new sales programs, and to increase penetration through its Internet sites. Overall Internet sales increased more than 50% as people rediscovered Fuller Brush on-line. Fuller Brush Internet sales have been profitable since the site (www.fullerbrush.com) was launched in 1998.

Full-year operating income for the segment represented a return of 7.3% versus a 9.3% return last year.

Imaging Segment

Sales for the quarter decreased $1.7 million to $10.6 million, due to the economic slowdown in the U.S.

Pricing and product mix for the quarter resulted in gross margins of 34.4% of sales, which was approximately equivalent to prior year. Segment margins are expected to remain in the 34% to 38% range for the next quarter.

Selling, administrative and engineering expenses for the quarter were 28.5% of sales versus 27.4% for the comparable quarter last year.

Imaging sales for the full year were $43.8 million, off 4.9% over prior year. Gross margins improved to 37.2% of sales versus 36.3% last year as a result of strong performance during the first half of the fiscal year.

Selling, administrative and engineering expenses for the year were 28.9% of sales versus 27.4% for the prior year. The Company continued its level of investment in sales and marketing programs with the expectation that sales volumes would increase as the economy improved. Despite strong competitive pressure, the Imaging segment as a whole maintained its market share and did not lose a single significant customer during this period.

Imaging operating income represented an 8% return on sales versus an 8.6% return last year.

The strong U.S. dollar and high currency translation rates negatively impacted foreign sales and operating results for all foreign locations. Translated at last year's rates, sales would have been $1.5 million higher, resulting in a sales decline of 1.6% versus the actual decline of 4.9%. Despite the translation impact, CPAC's combined foreign locations showed strong sales in their respective local currencies and continued to expand penetration into new foreign markets and distribution bases.

The translation rates also negatively affected pretax income. If translated at the prior year's rates, pretax income for the year would have been $170,000 higher. This negatively impacted net income by nearly $0.02 per diluted share.

Pretax income for the year was a 7% return on sales, compared to 7.8% of sales for the prior year.

Other Financial Information

EBITDA (earnings before interest, taxes, depreciation and amortization) were $11.6 million or $2.08 per share for the year.

Depreciation and amortization were approximately $3.5 million for the year with total capital additions of $1.4 million. Capital budgets have been reevaluated and the Company expects to expend approximately $3 million on additions for FY 02, all of which will be adequately financed from operating cash flows.

The statement of cash flows was strong for the year, starting with $4.4 million in cash. $1.4 million was invested in new property and equipment, $1.6 million of CPAC stock was repurchased in the marketplace, $861,000 of debt was paid down and cash dividends of $1.6 million were paid. At March 31, 2001 the Company had $8.9 million in available cash, no outstanding balance on its $20 million corporate line of credit, working capital of $31.5 million, and a strong balance sheet with continued substantial opportunity for leverage.

Thomas N. Hendrickson, CPAC's President and Chief Executive Officer, said, "We anticipate further challenges through 2001 as the U.S. economy struggles to achieve stability. In light of these expectations, we are aggressively undertaking multiple strategic initiatives to stimulate our fundamental businesses. We remain disciplined in our pursuit of excellent financial performance on behalf of our shareholders."

CPAC, Inc. is an international manufacturer and marketer of industrial and household cleaning products and related accessories, and personal care products for the cleaning and personal care industry, as well as prepackaged chemical formulations, supplies, and equipment systems for the imaging industry. The Company operates in two business segments: Cleaning and Personal Care (Fuller Brands) and Imaging. The Fuller Brands segment includes The Fuller Brush Company, Stanley Home Products, and Cleaning Technologies Group. CPAC's Imaging segment serves the global Imaging market and includes three domestic and four international chemical manufacturing operations. CPAC, Inc. shares trade on the Nasdaq National Market System under the ticker symbol "CPAK''. More information is available on the Company's web site (http://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.

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