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GERBER TO REVAMP APPAREL MANUFACTURING

 GERBER TO REVAMP APPAREL MANUFACTURING
 FREMONT, Mich., Jan. 13 /PRNewswire/ -- Gerber Products Company


(NYSE: GEB) is revamping parts of its apparel manufacturing primarily in response to significantly reduced demand for its cloth diaper products. This action will result in an after-tax charge to fiscal 1992 third quarter (ended 12/31/91) earnings of approximately $16 million, or $0.43 per share; however, there will be no negative cash flow impact.
 Included in the revamping are the closure of the company's diaper weaving operations and the consolidation of other basic textile production capabilities to increase overall productivity.
 "Gerber is taking this action to improve its long-term profitability. In the past year, there was a dramatic change in the cloth diaper market caused by reduced environmental concerns about disposable diapers which significantly cut retail demand for cloth diapers. Added to this was the fact that low-cost, foreign-sourced cloth diapers virtually captured the institutional market. Gerber cannot effectively compete in the cloth diaper market with our current high fixed-cost, vertically integrated U.S. manufacturing base," said Al Piergallini, Gerber chairman, president and chief executive officer.
 "We intend to remain in the diaper business, but in a competitive, flexible manner," he said.
 Piergallini said the margin improvement from this action will enhance future earnings and cash flows. He also pointed out that "the disappointing diaper business results are already reflected in current securities analysts' consensus estimates for Gerber's 1992 fiscal year -- excluding the restructuring charge. Our performance this fiscal year continues to be aided by volume growth in our baby food, baby care and international businesses."
 The revamping involves discontinuing certain operations in Pelzer, S.C.; Ephrata, Pa.; and Tempe, Ariz.
 A total of approximately 900 jobs will be eliminated by the restructuring. Piergallini closed by saying, "This decision regrettably costs some people their jobs. We didn't take this action lightly. We are going to help the affected employees by providing severance payments as well as other assistance to help them transition to new opportunities."
 -0- 1/13/92
 /CONTACT: Tim Croasdaile, VP - Investor Relations & Corporate Affairs, Gerber Products Company, 803-240-2867 (primary) or 616-928-2718 (secondary)/
 (GEB) CO: Gerber Products Company ST: Michigan IN: SU: RCN


ML -- DE003 -- 9014 01/13/92 10:32 EST
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Date:Jan 13, 1992
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