Company Press Release,Tuesday March 23
Geographics Pictures Bright 1999
Turnaround Plan Achieves Early Gains
BLAINE, Wash.--(BUSINESS WIRE)--March 23, 1999--An aggressive turnaround strategy, steady income growth, and enhanced
compliance with government reporting requirements, are among the strongest indicators that Geographics Inc. (OTCBB:GGIT - news;
TSE:GGI - news) has rebounded from the conditions facing CEO Dick Gockelman when he assumed leadership on July 27, 1998.
For the nine-month period ending Dec. 31, 1997, Geographics reported a net income loss of $5,565,744. A year later, income for those same preceding three quarters
was $368,503, exclusive of the $5,657,573 generated from the sale of the company's sign and lettering business. For each of the last three quarters of 1998 Geographics
posted net income gains, versus consecutive net income losses for the same periods in 1997. Gross margins have also jumped to 53.2% from 39.8% for the most recent
three-month period.
''When I took charge, this company barely had a financial heartbeat,'' Gockelman said. ''The MIS system was outdated, credit had dried up, purchasing was poorly
organized and the sales and marketing focus was unclear. We're not totally out of the woods yet, but in 1998 we made some solid progress we can build on.'' He added:
''Above all else it demonstrates that the plan is working. What's most needed now is to stay the course.''
In the first phase to revitalize the company, new management introduced more sophisticated inventory management and plant management control systems, established
stronger accounting policies, eliminated low margin products, and instituted travel and expense reporting procedures. The second phase featured a realignment of sales,
marketing and administrative support groups. In December 1998, Gockelman also brought in five individuals from outside the company to serve on the Board of Directors.
On March 22, 1999, Geographics filed three quarterly reports on Form 10-Q for the fiscal quarters ending June 30, Sept. 30 and Dec. 30, 1998. These filings, while not
timely filed, place Geographics in substantial compliance with its reporting obligations under the Securities Exchange Act of 1934. The company intends to file with the
SEC its two remaining delinquent filings on or before March 31, 1999.
Geographics Inc. is a manufacturer of value added and designer stationery paper products. Geographics Inc. distributes its products in the U.S., Canada, Australia and
Europe. The company employs over 100 employees. Geographics Inc. maintains its headquarters and principal production/warehousing facilities in Whatcom County,
Wash. The company also maintains warehouse/distribution facilities at its two wholly-owned subsidiaries, Geographics (Europe) LTD. with a facility near London, and
Geographics Australia Pty. LTD. with a facility near Sydney, Australia.
Statements made in this release may be construed to be forward-looking and are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform
Act of 1995. Investors are cautioned that all forward looking statements involve risks and uncertainties, including, without limitation, risks relating to operations and
acquisitions, the availability of capital to finance growth, as well as other matters disclosed in documents filed from time to time by the company with the U.S. Securities and
Exchange Commission.
Contact:
Geographics, Inc., Blaine
Richard C. Gockelman, CEO
360/332-6711
or
Andy Shea, 202/296-0263 |
