A. Schulman Annual Meeting Highlights Benefits of Strategy Focused on New Product Development and Cost Savings.

Business Editors

AKRON, Ohio--(BUSINESS WIRE)--Dec. 7, 2000

New product development and cost savings were important initiatives for A. Schulman Inc. (Nasdaq:SHLM) during fiscal 2000, Terry L. Haines, president and chief executive officer, said at today's annual stockholder meeting. Haines said the growth in new products, applications, patents and third-party approvals gives A. Schulman a strong foundation for future growth and expansion, although the near-term outlook remains challenging.

"Fiscal 2000 was an important year for research, development and deployment of new technology and products," Haines said. "Today, we have centralized R&D functions at two technology centers in the Akron area. Every day, we are implementing new applications for our products in the automotive and film and packaging industries. We are constantly evaluating our product mix and are committed to focusing on value-added and higher-margin products."

The company reported record sales in fiscal 2000 of $1.032 billion, a 4.8 percent increase over 1999 sales of $985.6 million. Those results were achieved despite the adverse translation effect of currencies, primarily the Euro, which reduced sales by $71.4 million for the fiscal year.

During the year, A. Schulman spent $32 million on capital expenditures, including the acquisition of a manufacturing facility in Milan, Italy, and the installation of new lines at several plants in North America, Europe and Asia. At the same time, the Company rationalized its product offerings and shut down certain manufacturing lines due to capacity and cost considerations. In addition, A. Schulman recently announced the termination of manufacturing at its plant in Akron, Ohio, which was the Company's oldest and most expensive to operate.

As a result of the actions described above, A. Schulman expects a higher level of capacity utilization for the coming year. Haines also said at the annual meeting that cost savings related to these and other actions will be approximately $15 million on an annualized basis.

"Unfortunately, despite the accomplishments, fiscal 2000 was a very challenging year," Haines said. "We faced significant increases in resin prices and competitive price pressures that resulted in less than satisfactory profit margins. The weakening of the Euro also had a large adverse effect on sales and profits."

As expected, fiscal 2001 is getting off to a difficult start and the months ahead will provide continuing challenges, Haines said. "We anticipate continued margin pressures, further softening in demand and some improvement in the Euro," he said. "On top of all that, it is no secret that economic activity is slowing." Haines said earnings for the first fiscal quarter ending November 30, 2000 will be down at least 25 percent from last year's first quarter profit of $11,942,000 or $.38 per share (which included a one-time insurance gain of $787,000 or $.02 per share).

During the annual meeting, A. Schulman shareholders reelected the following members to the Board of Directors for three-year terms:

-- Robert A. Stefanko, A. Schulman chairman of the board since 1991 and a
member of the Board since 1980.

-- James S. Marlen, a director since 1995 who is chairman of the board of
Ameron International Corporation.

-- Rene C. Rombouts, a director since 1992 who is general manager of the
Company's European subsidiaries.

Stockholders also approved an amendment to the A. Schulman 1992 Non-Employee Directors' Stock Option Plan. The amendment increases from 1,000 to 2,000 the number of shares of Common Stock subject to annual option grants for Non-Employee Directors and provides an annual grant of 500 restricted shares of Common Stock to each eligible director. The Company currently has eight Non-Employee Directors. In addition, shareholders approved the retention of PriceWaterhouseCoopers LLP as the independent accountant for the fiscal year ending August 31, 2001.

Finally, shareholders voted against a stockholder's proposal that called on the Board of Directors to "arrange for the prompt sale of A. Schulman Inc. to the highest bidder." Haines said, "The Board of Directors and management of the Company are steadfastly committed to increasing shareholder value and at all times are willing to consider alternative strategies to accomplish this goal. Right now, we believe the Company's increased growth, global market expansion, acquisition strategies and improved operating efficiencies are the best ways to enhance stockholder value over the long term."

About A. Schulman Inc.

Headquartered in Akron, Ohio, A. Schulman is a leading international supplier of high-performance plastic compounds and resins. These materials are used in a variety of consumer, industrial, automotive and packaging applications. The Company employs about 2,500 people and has 14 manufacturing facilities in North America, Europe, Mexico and the Asia-Pacific region. Revenues for the fiscal year ended August 31, 2000, were approximately $1 billion. Additional information about A. Schulman can be found on the World Wide Web at www.aschulman.com.

Statements in this release which are not historical facts are forward looking statements which involve risks and uncertainties and actual events or results could differ materially from those expressed or implied in this release. These "forward-looking statements" are based on currently available information. They are also inherently uncertain, and investors must recognize that events could turn out to be significantly different from what was expected. Examples of such uncertainties include, but are not limited to, the following:

-- Worldwide and regional economic, business and political

conditions

-- Fluctuations in the value of the currencies in major areas

where the Company operates, i.e., the U.S. dollar, the Euro,

U.K. pound sterling, Canadian dollar, Mexican peso and

Indonesian rupiah 

-- Fluctuations in the prices of plastic resins and other raw

materials

-- Changes in customer demand and requirements