Contact Information: AT SCHAWK, INC.: Timothy J. Cunningham Interim Chief Financial Officer (847) 827-9494 tim.cunningham@schawk.com AT DRESNER CORPORATE SERVICES: Philip Kranz 312-780-7240 pkranz@dresnerco.com
Schawk, Inc. Announces Preliminary Estimate of Second Quarter 2008 Results
| Source: Schawk, Inc.
DES PLAINES, IL--(Marketwire - August 12, 2008) - Schawk, Inc. (NYSE : SGK ), a leading
provider of brand point management services, enabling companies of all
sizes to connect their brands with consumers to create deeper brand
affinity, today announced that it anticipates reporting net sales of
approximately $133 million for quarter ended June 30, 2008, an
approximately 6.5 percent decrease in net sales relative to the comparable
prior year period. The Company anticipates that second quarter packaging
revenues (which represents approximately 62 percent of total sales) will
decrease by 2.7 percent, as consumer product companies continue to struggle
with higher raw material and transportation costs and private label
competition, with entertainment and advertising/retail customers having an
adverse sales performance versus last year. As a result of the adverse
sales performance, growing pricing pressures and the related profit
impact, the Company continues with its previously announced steps to
aggressively lower its cost base and more effectively utilize its lower
cost global production capabilities.
Due in part to lower sales volume, as well as the expected incurrence of
approximately $3.2 million in restructuring related charges and
approximately $2.2 million for an impaired asset charge for software, the
Company also expects to report second quarter operating income of
approximately $5.3 million versus operating income of $18.5 million in the
comparable prior year period. The decline in operating income is also
expected to be attributable in part to an increase in professional fees
related to the Company's internal controls remediation, higher costs
associated with its 2007 audit, and costs related to the Company's
rebranding initiative. The Company also anticipates that an expected
income tax valuation allowance of approximately $1.5 million will
contribute in part to a decrease in net income to approximately $0.8
million in the second quarter of 2008 from $9.9 million in the comparable
prior year period. The Company is in the process of finalizing its results
for the quarter ended June 30, 2008, and therefore the above estimates are
preliminary and subject to change.
About Schawk, Inc.
Schawk, Inc. is the leading provider of brand point management services,
enabling companies of all sizes to connect their brands with consumers to
create deeper brand affinity. With a global footprint of more than 60
offices, Schawk helps companies create compelling and consistent brand
experiences by providing integrated strategic, creative and executional
services across brand touchpoints. Founded in 1953, Schawk is trusted by
many of the world's leading organizations to help them achieve global brand
consistency. For more information about Schawk, visit
http://www.schawk.com.
Safe Harbor Statement
Certain statements in this press release are forward-looking statements
within the meaning of Section 21E of the Securities and Exchange Act of
1934, as amended and are subject to the safe harbor created thereby. Such
forward-looking statements are based on the Company's current expectations
and beliefs, which are subject to change, and involve certain risks and
uncertainties including, in particular, whether the Company's final
unaudited financial results for the quarterly period ended June 30, 2008
will comport with the preliminary information summarized herein. These
risks and uncertainties may cause actual results to differ materially from
those contained in the forward-looking statements.