EXHIBIT 99.1
FOR IMMEDIATE RELEASE CONTACT: Investor:
Dave Bosher 804-287-5685
Vice President and Treasurer
Media:
Teri Schrettenbrunner 804-287-6260
Director of Public Relations
CADMUS COMMUNICATIONS CORPORATION ACQUIRES
THE MACK PRINTING GROUP
EXPANDS LEADERSHIP POSITION IN SCIENTIFIC, TECHNICAL, MEDICAL NICHE
RICHMOND, VA -- April 1, 1999 -- Cadmus Communications Corporation (NASDAQ NMS:
CDMS) today announced that it has acquired The Mack Printing Group and its
subsidiaries ("Mack"). Mack is a leading national producer of journals,
magazines and periodicals, with annual revenues of approximately $165 million.
The purchase price, consisting of cash, seller-provided subordinated debt, and
Cadmus common stock, was approximately $200 million. Cadmus anticipates that the
transaction will be accretive to net income in fiscal 2000.
This acquisition continues Cadmus' strategy of creating leadership positions in
select niche markets. The addition of Mack increases Cadmus' annual revenues by
over 40% and solidifies its position as the world's leading producer of
scientific, technical and medical (STM) journals. The acquisition brings to
Cadmus new capabilities to better serve the faster-growing "short-run" segment
of the STM market, and significantly strengthens Cadmus' magazine business by
adding new production and distribution capabilities.
C. Stephenson Gillispie, Jr., Cadmus' chairman, president and chief executive
officer, noted, "This acquisition is a giant step forward both operationally and
financially. Cadmus is now one of North America's five largest periodical
printers. With our increased size, we will capture operating benefits from
enhanced synergies and economies of scale. Financially, we are strengthening
Cadmus by adding a business with a solid track record of consistent growth,
double-digit operating margins, and strong cash flows. We will increase cash
flow per share, significantly expand our operating margins and, coupled with
other recent organizational changes, further stabilize the earnings performance
of our business. We are excited about the short and long-term opportunities this
acquisition creates."
Joseph J. Ward, executive vice president of Cadmus' Professional Communications
sector, added, "Mack's strengths in "short-run" printing and directory
production add vital new competencies to our Professional Communications sector.
Coupled with our recently announced acquisition of Dynamic Diagrams -- a
Web-based architecture firm -- we can now provide an unmatched spectrum of
end-to-end solutions to our customers."
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CADMUS COMMUNICATIONS CORPORATION
MACK ACQUISITION
PAGE 2
Commenting on the transaction, Paul Mack, Mack's chairman, stated, "We are
delighted to be joining forces with a market leader that has a well-established
reputation for offering world-class, digital solutions to journal and specialty
magazine publishers. Based on its successful acquisitions of Waverly Press and
Lancaster, Cadmus has an outstanding track record of acquiring and integrating
periodical production companies. As a part of Cadmus, we will be able to deliver
a broader range of integrated, professional communications services to our
existing customers."
Mack will operate initially under the name CadmusMack and will remain
headquartered in Easton, Pennsylvania with manufacturing facilities located in
Easton, Ephrata, and East Stroudsburg, Pennsylvania, as well as in Baltimore,
Maryland. Mack will operate under Cadmus' Professional Communications sector
headed by Ward. Mack's current management team, including Mark Ploucha,
executive vice president of operations, and Steve Smith, executive vice
president of finance and administration, will remain with the company in their
current capacities.
Cadmus also announced that N. R. Puri, the former majority owner of The Mack
Printing Group, has joined Cadmus' Board of Directors. Mr. Puri's business
interests include investments in U.S., UK, German, Chinese, and Hungarian
companies that collectively employ over 5,000 people. "We are very fortunate
that Nat has agreed to join our Board," said Gillispie. "His well-rounded,
international expertise in a wide range of fields will be a great asset to
Cadmus."
Among the nation's largest publication printers and the second largest producer
of STM journals, The Mack Printing Group is headquartered in Easton,
Pennsylvania. The company composes, prints, and distributes over 500 STM
journals, in addition to nearly 200 magazines and other periodicals, from
sheet-fed and web printing facilities in Easton, Ephrata, and East Stroudsburg,
Pennsylvania, as well as in Baltimore, Maryland. Additional information about
Mack is available at the company's web site - www.mpg.com.
Cadmus Communications Corporation provides customers with integrated, end-to-end
communications solutions. The company is organized around two primary business
sectors: Professional Communications, serving customers who publish information,
and Marketing Communications, serving customers who convey marketing messages.
Additional information about Cadmus is available at the company's web site -
www.cadmus.com.
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"SAFE HARBOR" STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF
1995: Information in this release relating to Cadmus' future prospects and
performance are "forward-looking statements" and, as such, are subject to
certain risks and uncertainties that could cause actual results to differ
materially. Potential risks and uncertainties include but are not limited to:
(1) the effective integration of recent acquisitions, (2) continuing competitive
pricing in the markets in which the company competes, (3) the gain or loss of
significant customers or the decrease in demand from existing customers, (4) the
ability of the company to continue to obtain improved efficiencies and lower
overall production costs, (5) changes in the company's product sales mix, (6)
the performance of new management and leadership teams in the company and its
divisions, (7) the impact of industry consolidation among key customers, (8) the
ability of the company to operate profitably and effectively with higher levels
of indebtedness, and (9) the ability to retain key employees and managers in
light of lower than planned incentives and benefits.