Checkpoint Systems, Inc. Reports 1998 Third Quarter and Nine Month Financial Results.

THOROFARE, N.J.--(BUSINESS WIRE)--Oct. 22, 1998--Checkpoint Systems, Inc., (NYSE: CKP), today reported financial results for the third quarter and nine months ended September 27, 1998.

Net revenues for the third quarter of 1998 were $94,042,000, compared to $87,959,000 in the third quarter of 1997. Net income for the 1998 third quarter was $6,720,000, or $0.20 per share, compared with $6,050,000 or $0.17 per share, in the third quarter of 1997. (All references to earning per share are on a fully diluted basis).

Net revenues for the nine months ended September 27, 1998 were $264,477,000 compared to $237,173,000, for the comparable period in 1997. Net income for the nine months ended September 27, 1998 was $11,685,000, or $0.35 per share, compared to $13,351,000, or $0.38 per share, for the comparable period of 1997.

Kevin P. Dowd, President and Chief Executive Officer, commented, "We are very pleased with the results of the third quarter. Revenues, especially in our North American business, were stronger than anticipated with continued rollouts in the supermarket industry and installations in over 300 Toys "R" Us stores in the United States. Our gross profit margin improved significantly due to previously announced cost cutting, as well as an improvement in product mix, specifically an increase in sales of disposable labels and electronic article surveillance systems. We reduced our SG&A expenses as a percentage of revenues to 30.4%, compared to 32.4% during the second quarter of 1998 and 32.5% during the third quarter of 1997."

Mr. Dowd further commented, "Cash flow from operations exceeded $6,300,000 and was sufficient to fund all capital expenditures and partially funded our stock buyback program. In the near-term, we will continue to focus our energies on quality market share growth and cost savings."

Checkpoint Systems, Inc., located in Thorofare, New Jersey, is a leading provider of integrated security solutions to retailers. More than 350,000 Checkpoint RF EAS systems are installed worldwide. Checkpoint Systems, Inc.'s website is located at www.checkpointsystems.com.

Safe Harbor Statement

This presentation may include information that could constitute forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements may involve risk and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements. Factors that could cause or contribute to such differences include those matters disclosed in the Company's Security and Exchange Commission filings. -0-

                        Checkpoint Systems Inc.
                   Consolidated Statements of Income
            (Amounts in thousands except per share amounts)

Operating Results (unaudited)

                               Quarter             Nine Months
                          (13 Weeks Ended)       (39 Weeks Ended)
                        Sept. 27,   Sept. 28,  Sept. 27,   Sept. 28,
                          1998        1997       1998        1997

Net revenues            $ 94,042    $ 87,959  $ 264,477   $ 237,173
Cost of revenues          54,602      50,373    157,822     137,011
  Gross profit            39,440      37,586    106,655     100,162
Selling, general and
administrative expenses   28,582      28,551     86,573      82,897
Income from operations    10,858       9,035     20,082      17,265

Interest income            1,329       1,899      3,519       7,092
Interest expense           2,179       2,302      7,186       7,055
Other income / (loss) net     (7)        226        866       2,389

Income before taxes       10,001       8,858     17,281      19,691
Income taxes               3,250       2,879      5,616       6,411
Minority Interest            (31)         71         20          71
Net earnings            $  6,720    $  6,050   $ 11,685   $  13,351

Net earnings per share:(1)
  Basic                 $   0.21    $   0.18   $   0.36   $    0.39
  Diluted (2)           $   0.20    $   0.17   $   0.35   $    0.38

Average shares outstanding:
  Basic                   32,031      33,935     32,825      34,148
  Diluted (2)             39,041      34,953     33,902      35,328

Financial Position
(Thousands)
                             September 27,     December 28,
                                1998              1997
                             (unaudited)

Cash and investments       $    40,138       $    64,138
Working capital                193,312           211,570
Current assets                 278,632           297,680
Long-term debt                 164,718           150,855
Shareholders' equity           271,376           277,550
Total assets                   522,726           516,434

(1) Quarterly earnings per share are computed independently,

therefore the sum of the quarters may not equal the year-to-date

earnings per share.

(2) Includes the dilutive effect of (i) the assumed exercise of stock

options for all periods and (ii) the effect of the assumed

conversion of the subordinated debentures for the three months

ended September 27, 1998. Conversion of the subordinated

debentures is not included for the other periods as the

conversion price is anti-dilutive.