A. Schulman Projects Record Net Income and Earnings Per Share for Fiscal 1999; Says Strategic Programs are Driving the Improved Performance.

AKRON, Ohio--(BUSINESS WIRE)--Dec. 10, 1998--A. Schulman Inc. (Nasdaq:SHLM) is on course for a record year in fiscal 1999 for both net income and earnings per share, according to Terry L. Haines, president and chief executive officer.

In his comments at today's annual stockholder meeting, Haines attributed the positive outlook to increasing North American sales, the implementation of several strategic programs, and a positive currency translation effect. For the fiscal 1999 first quarter ended November 30, 1998, he said A. Schulman should meet or exceed analysts' consensus estimates of approximately $0.40 for earnings per share.

"Per share earnings for the fiscal year ended August 31, 1998, were a record $1.48, before the cumulative effect of an accounting change. We also anticipate an improvement in our fiscal 1999 first quarter results, compared with the same period last year," Haines said. "In North America, sales orders are increasing and our plants' backlogs are improving. Even in Europe, where orders recently fell off slightly more than the usual calendar year-end decline, we expect to see business pick up in the second quarter of fiscal 1999."

A. Schulman's projections for a record fiscal 1999 in terms of per share earnings and net income follow fiscal 1998 net income of $50,143,000. The record for fiscal year net income is $53,618,000, which A. Schulman recorded in 1995.

Haines said recent investments worldwide are having a positive impact on A. Schulman. In fiscal 1998, the company spent $31 million on capital expenditures, including adding new manufacturing lines in Canada, Mexico and the United Kingdom. A. Schulman also opened a new manufacturing facility in Indonesia and acquired Isopolymer Inc. of Milan, Italy.

In addition, A. Schulman is expanding its manufacturing facility in Givet, France, and will build a new warehouse and logistics facility in Germany. It is also adding a Product Technology Center and a Color Technology Center in Ohio, which are scheduled to open in 1999.

"These strategic investments are already starting to show returns, and their long-term prospects are excellent," Haines said. "The Product Technology Center and Color Technology Center will make us a global leader in research and development."

In another multi-year strategic initiative, the company is redesigning its business systems with the Business Enhancement for Today & Tomorrow (BETT) program. BETT, which includes integrated software and improved scheduling and inventory controls, is being phased in throughout A. Schulman's North American operations. As part of BETT, the company is introducing a centralized customer sales support center to improve customer service and make it easier for customers to work with A. Schulman.

In addition, the company has adopted a global purchasing strategy, which involves combining purchasing forces worldwide and establishing global supplier relationships to reduce procurement costs and inventory levels, and improve quality.

Haines told stockholders that other points of strategic focus include: -0-

--   Excellence in manufacturing, e.g., 12 plants and offices have ISO
     9000 registration.

--   Aggressive sales and marketing growth, primarily by focusing on
     automotive industry strengths and growing the film and packaging
     businesses.

--   Strong capital management, including stable cash flows, excellent
     credit capabilities with favorable borrowing rates, a solid
     balance sheet with few intangibles, and enhanced risk management.

--   Investing in people, including ongoing training for all employees
     and technical education for sales and marketing staff.

During the annual meeting, stockholders reelected three directors to the Board of Directors. Their new terms will expire at the 2001 Annual Meeting of Stockholders. They are: -0-

--   Haines, president and CEO since 1991; and, before that, chief
     operating officer.

--   Dr. Paul Craig Roberts, a director since 1992, syndicated
     columnist and chairman of Institute for Political Economy.

--   James A. Karman, a director since 1995 and president and chief
     operating officer of RPM, Inc.

Stockholders also approved the selection of PricewaterhouseCoopers LLP as independent accountants for A. Schulman.

In other business, a majority of shareholders voted against a shareholder resolution that called on the Board of Directors to "consider the prompt sale of A. Schulman Inc. to the highest bidder."

However, a majority of stockholders voted for a non-binding resolution asking the Board of Directors to consider "declassifying" itself so that all directors must be elected annually. Three or four of the seats on the 10-member board are up for election in any given year. The resolution requires the board to "consider taking the necessary steps" toward declassification. It would not apply to the unexpired terms of directors previously elected. Any changes would require Board approval and support from holders of 80 percent of the company's outstanding shares of Common Stock.

The Board of Directors had urged stockholders to vote against the resolution. Haines said, "We're disappointed with the outcome of the vote because a classified board provides corporate accountability and stability. Stockholders have the chance to alter a portion of the board's make-up each year, which allows them to effect change but prevents sudden and disruptive shifts in corporate strategy and policy." Haines said the Board will thoroughly review the declassification issue and determine a course of action.

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 2,300 people and has 13 manufacturing facilities in North America, Europe, Mexico and the Asia-Pacific region. Revenues for the fiscal year ended August 31, 1998 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: -0-

--   Worldwide and regional economic, business and political
     conditions

--   Fluctuations in the value of currencies within the European
     Monetary System, as well as the U.S. dollar, Canadian dollar,
     Mexican peso and Indonesian rupiah

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

--   Changes in customer demand and requirements