CADMUS COMMUNICATIONS CORP. REPORTS INCREASED EARNINGS FOR FISCAL YEAR 1995.

RICHMOND, Va.--(BUSINESS WIRE)--Aug. 1, 1995--Cadmus Communications Corp. (NASDAQ NMS: CDMS) reports increased sales and net income for the quarter and fiscal year ended June 30, 1995.

For the fiscal year ended June 30, 1995, net income was $7.5 million, up 44.2% from the $5.2 million recorded in fiscal 1994. Net income per share for fiscal year 1995 was $1.21 per share on average outstanding shares of 6,195,000 compared to $.86 per share on average outstanding shares of 6,085,000 last year.

Michael Dinkins, chief financial officer, explained that there were several items in fiscal 1994 which affect the comparability of the two years: "Our fiscal year 1994 fourth quarter earnings included a $1.9 million pre-tax restructuring charge, or $.19 per share, to consolidate certain prepress operations. Our fiscal 1994 earnings also reflected our adoption in the first quarter of two accounting standards, which together resulted in a noncash after-tax credit of $.4 million, or $.07 per share."

Excluding the restructuring charge, income before changes in accounting principles rose 23.5% in fiscal 1995 from the $.98 per share recorded in fiscal 1994. Sales for the fiscal year 1995 were $279.6 million, up 12.9% over fiscal 1994.

Net income for the fourth quarter of fiscal 1995 was $2.7 million, more than triple fourth quarter fiscal 1994 net income of $0.8 million. Net income per share for the quarter was $.43 compared to $.12 for the same quarter in fiscal 1994. Adjusted for the 1994 restructuring charge, operating income rose 19.0% and operating margins improved to 7.2% from 6.7% for the fourth quarter.

Sales for the fourth quarter of fiscal 1995 were $77.2 million, up 10.8% over sales of $69.7 million recorded in the same period of fiscal 1994. The fourth quarter sales growth was driven by growth in each of the company's business groups. Printing sales rose 11.0% due to continued growth in specialty packaging and research journals, and a rebound in financial printing sales. Marketing revenues rose 12.3%, primarily a result of continued growth in point-of-sale products and services. Publishing revenues increased 22.4% due to strength in the company's contract publishing business.

C. Stephenson Gillispie, Jr., chairman and chief executive officer, noted, "While sales grew across the board, we are particularly pleased with the significant growth in our highest margin product lines. Improvements in our operating margins, despite higher paper prices, are evidence of progress in enhancing our product mix and in improving our cost structure. We are positioning Cadmus as a unified graphic communications company, focused on product lines and markets, and are excited about the potential of the company."

Headquartered in Richmond, Cadmus Communications Corp. is a graphic communications company specializing in printing, marketing, and publishing. -0-

                CADMUS COMMUNICATIONS CORPORATION AND SUBSIDIARIES
                          CONSOLIDATED STATEMENTS OF INCOME
                        (In thousands, except per share data)
                                     (Unaudited)

                            Three Months Ended        Years Ended
                                 June 30,               June 30,
                             1995       1994        1995       1994

Net sales                  $77,175    $69,743     $279,641   $247,730
Operating expenses
  Cost of sales             56,932     51,263      209,415    184,088
  Selling and
   administrative           14,664     13,806       52,172     48,824
  Restructuring charge                  1,900                   1,900
Operating income            5,579       2,774       18,054     12,918
Interest and other
 (income) expenses
  Interest                  1,288       1,513        5,351      4,813
  Other (income)
   expenses, net               59          64           21        172
Income before income taxes  4,232       1,197       12,682      7,933
Income taxes                1,579         418        5,203      3,126
Income before cumulative
 effect of changes in
 accounting principles      2,653         779        7,479      4,807
Cumulative effect of
 changes in
  accounting for:
    Postretirement benefits
     (net of income tax
      benefit of $355)                                           (532)
    Income taxes                                                  933
Net income                $ 2,653     $   779     $  7,479   $  5,208
Earnings per share:
  Income before cumulative effect
   of changes in accounting
   principles             $   .43     $   .12     $   1.21   $    .79
  Cumulative effect of
   changes in accounting
   for postretirement
   benefits and
   income taxes                                                   .07
  Net income              $   .43     $   .12     $   1.21   $    .86
Average number of
 common shares
  outstanding               6,195       6,085        6,195      6,085
Cash dividends per
 common share             $   .05     $   .05     $    .20   $    .20

CONTACT: Cadmus Communications

David E. Bosher, 804/287-5685