FiberMark Announces Earnings for Second Quarter 1999.

BRATTLEBORO, Vt.--(BUSINESS WIRE)--July 28, 1999--

FiberMark, Inc. (NYSE:FMK) today reported that net earnings for the second quarter ended June 30, 1999 rose 10% to $4.2 million, or $.53 per share, compared with $3.8 million, or $.46 per share, for the second quarter of 1998.

Net sales for the quarter decreased 3% to $76.0 million from $78.6 million in the second quarter of 1998. Filter media sales for the most recent quarter decreased 2% to $24.6 million compared with $25.1 million in the second quarter of 1998. Technical specialties sales decreased 23% to $15.7 million compared with $20.4 million for the second quarter of 1998. Sales in durable specialties increased 11.1% to $23.0 million versus $20.7 million in the comparable 1998 quarter. Office products sales increased 4% to $12.9 million compared with $12.4 million for the same period last year.

Earnings for the six-month period ended June 30, 1999 were $8.3 million, or $1.04 per share, compared with $8.1 million, or $1.00 per share, for the comparable six-month period in 1998. Net sales for the six-month period ended June 30, 1999 were $151.9 million compared with $158.5 million for the first six months of 1998.

"While we experienced pockets of both strength and weakness, overall sales remained steady," said Alex Kwader, president and chief executive officer. "In our tape business, we saw record sales in Germany and very strong sales in the U.S. The shortfall in technical specialties is primarily due to reduced book cover volume after a customer brought manufacturing in-house, a factor we have previously disclosed. Additionally, we experienced some softness in our abrasive and printing grade product lines. Sales in the office products market increased due to continued new business gains."

Favorable pulp costs and generally good manufacturing efficiencies enabled the company to improve earnings compared with the second quarter 1998. While the direction of pulp pricing during the balance of the year is uncertain, the company expects to finish the year with costs in line with 1998.

Kwader also said the company is encouraged by favorable order levels early in the third quarter. "While the third quarter is traditionally our softest quarter due to manufacturing shutdowns taken by our customers, orders now range from steady to strong throughout the company," he said. "We also have indications from some customers that second half demand for filing products may get a boost from Year 2000 concerns, as users generate hard copy back up material for computer files."

In May, we successfully negotiated five-year contracts with hourly employees in Warren Glen and Hughesville. In June, FiberMark experienced a brief strike at its Rochester, Michigan, facility. The facility continued to operate with salaried employees without any interruptions in service, and a five-year contract was signed with hourly employees at this facility.

Following the company's stock repurchase program announced March 31, 1999, the company has purchased 85,400 shares through July 27. The program authorized the repurchase of up to 1 million shares.

FiberMark is a leading producer of specialty fiber-based materials meeting industrial and consumer needs worldwide. Products cover a broad spectrum including filter materials for automotive, heavy equipment, vacuum bag and fast food applications; cover and presentation materials for office and school supplies; specialty tape base and labels for medical tapes and jeans labels; and technical specialties including base materials for photographic and graphic arts applications, printed circuit boards and abrasives. The company currently has nine facilities throughout the United States and Europe.

This press release contains forward-looking statements. Actual results may differ depending on the economy and other factors discussed in the company's Form 10K filed with the SEC March 31, 1999.

Web address: www.fibermark.com

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                            FIBERMARK, INC.
                   Consolidated Statements of Income
               Three Months Ended June 30, 1999 and 1998

               (In thousands, except per share amounts)



                                                   1999      1998

Net sales                                         $75,982   $78,591

Cost of sales                                      60,383    63,824

             Gross profit                          15,599    14,767

Selling, general and administrative expenses        5,696     5,665

             Income from operations                 9,903     9,102


Other (income) expense, net                            80        53

Interest expense                                    2,723     2,582


             Income before income taxes             7,100     6,467

Income tax expense                                  2,890     2,716


             Net income                           $ 4,210   $ 3,751



             Basic earnings per share             $  0.54   $  0.48

             Diluted earnings per share           $  0.53   $  0.46



             Average Basic Shares Outstanding       7,727     7,751
             Average Diluted Shares Outstanding     7,925     8,096




                            FIBERMARK, INC.
                   Consolidated Statements of Income
                Six Months Ended June 30, 1999 and 1998

               (In thousands, except per share amounts)



                                                    1999       1998

Net sales                                         $151,888   $158,542

Cost of sales                                      121,013    128,099

             Gross profit                           30,875     30,443

Selling, general and administrative expenses        11,460     11,184

             Income from operations                 19,415     19,259


Other (income) expense, net                            182        115

Interest expense                                     5,229      5,136


             Income before income taxes             14,004     14,008

Income tax expense                                   5,740      5,906


             Net income                           $  8,264   $  8,102



             Basic earnings per share             $   1.07   $   1.05

             Diluted earnings per share           $   1.04   $   1.00



             Average Basic Shares Outstanding        7,759      7,727
             Average Diluted Shares Outstanding      7,946      8,100




                            FIBERMARK, INC.
                      Consolidated Balance Sheets

                            (In Thousands)

                                               Unaudited    Audited
                                                June 30,  December 31,
                                                 1999          1998
                           ASSETS
Current assets:
       Cash                                    $  27,634    $  33,804
       Accounts receivable                        38,493       31,518
       Inventories                                47,876       48,517
       Other                                         869          700
       Prepaid expense                               307          204
       Deferred income taxes                       4,477        4,612

                 Total current assets            119,656      119,355

Property, plant and equipment, net               126,688      128,375
Goodwill, net                                     48,008       49,692
Other intangible assets, net                       8,027        8,383
Prepaid expense                                    1,226        1,176
Other long-term assets                             1,276        1,433
Other pension assets                               2,817        2,817

                 Total assets                  $ 307,698    $ 311,231


         LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
       Current portion long-term debt          $   3,171    $   3,598
       Accounts payable                           14,381       16,484
       Accrued liabilities                        16,855       15,670
       Accrued income taxes payable                2,262        1,440
       Accrued pension liabilities                   985        1,572

                 TOTAL CURRENT LIABILITIES        37,654       38,764

Long term liabilities:
       Long  term debt, less current portion     129,072      133,583
       Deferred gain                               8,307        9,166
       Deferred income taxes                      12,226       12,655
       Other long-term liabilities                18,131       19,500

                 Total long-term liabilities     167,736      174,904

                 Total liabilities               205,390      213,668

Stockholders' Equity
       Common stock                                    8            8
       Additional paid-in capital                 75,697       76,554
       Retained earnings                          29,298       21,034
       Accumulated other comprehensive income     (2,695)         (33)

                 Total stockholders' equity      102,308       97,563

                 Total liabilities and
                   stockholders' equity        $ 307,698    $ 311,231