EXHIBIT 99.1
FOR IMMEDIATE RELEASE
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Contacts:
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Michael L. Schmickle Investor Relations:
Chief Financial Officer Brad Cohen
Workflow Management, Inc. Integrated Corporate Relations, Inc.
(561) 659-6551 ext. 302 (561) 659-6551 ext. 461
WORKFLOW MANAGEMENT, INC. REPORTS
UPDATE ON CREDIT FACILITY AND COVENANTS
PALM BEACH, FL, April 26, 2002 - Workflow Management, Inc. (Nasdaq: WORK), a
leading outsourcer of graphic services, announced today that it has amended its
January 31, 2002 form 10-Q to report that the Company was not in compliance with
its secured revolving credit facility (the "Credit Facility"). The Company is
currently working with its lenders to obtain a waiver for its default and to
amend certain provisions of the Credit Facility. Management is confident that it
should be able to obtain a waiver for its default in the next 30 days.
The Credit Facility requires the Company to remain in compliance with certain
financial covenants which include a total debt to pro forma EBITDA maximum
("Total Leverage Ratio") of 3.75 to 1.0. Effective April 30, 2002, the Credit
Facility provides an additional covenant of senior, Credit Facility debt to pro
forma EBITDA maximum ("Senior Leverage Ratio") of 3.5 to 1.0. At January 31,
2002, the Total Leverage Ratio calculated under the Credit Facility was 3.82 to
1.0. Accordingly, the Company was, and remains, in default of the Credit
Facility's financial covenants. Additionally, the Company does not believe that
it will be in compliance with the Senior Leverage Ratio at April 30, 2002.
While the terms of the waiver and amendment of the Credit Facility have not been
fully negotiated, the Company will likely be required to pay fees to its
lenders. The Company is also considering and pursuing strategic alternatives
that could generate cash to reduce borrowings under the Credit Facility. There
can be no assurance that the Company will be able to obtain the waiver and
amendment of the Credit Facility from its lenders or that the Company will be
able to generate cash to reduce borrowings under the Credit Facility. In the
event that the Company's default under the Credit Facility is not waived by its
lenders, the Company's financial condition is likely to be materially and
adversely affected.
About Workflow Management, Inc.
Workflow Management, Inc. is a leading provider of end-to-end outsource
solutions for print. By providing a variety of print solutions; including the
printing of promotional items with a company logo to multi-color annual reports,
Workflow has built a reputation of reliability and leadership within the
industry. Workflow's complete cadre of service solutions includes unbiased
outsource and enterprise document strategy consulting, full-service print
manufacturing and outsourcing; warehousing; fulfillment and Workflow's
proprietary iGetSmartTM system; the industry proven, e-procurement, management
and logistics system. Utilizing a customized combination of these services, the
Company is able to deliver substantial savings to its customers by targeting and
eliminating much of the hidden costs within the print supply chain. And, by
outsourcing these non-core business processes to Workflow, customers are able to
streamline their operations and focus on their core business objectives.
Except for historical information, matters discussed in this press release are
forward-looking statements that involve risks and uncertainties, and actual
results may be materially different. Factors that could cause actual results to
differ include: economic downturns; changes in customer purchasing patterns;
risks associated with our debt service; risks associated with future growth;
risks associated with acquisitions; change in customer preferences and trends
away from print; risks associated with foreign and international business;
disruptions in product supplies; decreased availability and increased cost of
paper; competition in our markets; loss of key members of our management team;
reliance on third parties for maintaining our management information systems;
concentration of the Company's common stock; and volatility of the Company
common stock. The information included in this press release is operative as of
this date only. Workflow Management, Inc. does not undertake any obligation to
update its forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated events. In order
to ensure that all investors continue to have equal access to the same
information, Workflow Management, Inc. will refrain from updating projections
made in this press release unless it does so through means that are designed to
provide broad distribution of the information to the public.