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CHESAPEAKE REPORTS SECOND QUARTER EARNINGS

 CHESAPEAKE REPORTS SECOND QUARTER EARNINGS
 RICHMOND, Va., July 23 /PRNewswire/ -- Chesapeake Corporation


(NYSE: CSK) announced second quarter net income of $4.3 million, or $.18 a share, up from $2.4 million, or $.12 a share, earned both in the second quarter of 1991 and in the first quarter of 1992. Sales for the quarter ended June 30, 1992 were a record $229.3 million, up 5 percent from a year ago, and up 9 percent from the first quarter of 1992.
 Net income for the first half of 1992 was $6.8 million, or $.30 a share, up from $4.8 million, or $.24 a share, earned in the first half of 1991. Year to date sales for 1992 were up 5 percent to $439.4 million. EBIT (earnings before interest and taxes) for the first two quarters was $27.4 million, or 4% higher than in 1991.
 Second quarter interest expense of $7.5 million was down $1.0 million from the first quarter and was $1.3 million less than in the second quarter of 1991.
 First half interest expense of $16.0 million was 10 percent less than in 1991 due to higher capitalized interest, lower interest rates and lower debt levels. In early April, net proceeds of $59.7 million from the sale of 2.5 million additional shares of common stock were used to reduce long-term debt.
 Chesapeake's long-term debt to total capital ratio was 45% at the end of the second quarter of 1992 compared to 52 percent at the end of the first quarter and 50 percent at the end of the second quarter of last year.
 For the first two quarters of 1992, "EBIT + D" (earnings before interest and taxes plus depreciation and other noncash charges) was $60.6 million, or 2 percent higher than $59.5 million in the first two quarters of 1991. Capital expenditures for the first half of 1992, primarily for the recovery boiler project at the West Point, Va. kraft mill, were $50 million.
 Working capital declined $15 million in the second quarter as seasonal inventory levels were reduced.
 Both the tissue and kraft businesses experienced record quarterly shipments in the second quarter of 1992. Compared to the first quarter, tissue shipments were up 16 percent, while kraft shipments were up slightly despite a maintenance outage at the West Point mill in April. Compared to the first half of 1991, year to date shipments were up 8 percent for tissue products and 3 percent for kraft products. Packaging shipments were about equal to the first quarter and were up 5 percent when compared to the first half of 1991.
 J. Carter Fox, president and chief executive officer, commented, "Second quarter earnings improved for Chesapeake despite an erratic economy and numerous operating challenges at our West Point kraft mill. Operating costs at this complex increased as chemical recovery capabilities were reduced by the permanent closure of an old recovery boiler. Additionally, 8,000 tons of production were lost during April because of maintenance and recovery boiler tie-ins. Despite these obstacles, production volume and profitability increased when compared to second quarter 1991.
 "Our tissue business had record shipments for the quarter, and we successfully implemented a price increase during June. Prices for bleached hardwood market pulp were likewise raised during the quarter and have now been followed by a July increase. With this latest increase, pulp prices have recovered approximately 25 percent since September 1991.
 Chesapeake has also announced a $40 per ton increase effective Sept. 1 for containerboard products."
 Mr. Fox concluded, "Our operations continue to perform well and will be further aided as our new recovery boiler comes on-line during the third quarter.
 Continuation of the recent price momentum will have a favorable impact on our financialresults, and I am confident that third quarter earnings will show continued improvement."
 Chesapeake Corporation (NYSE: CSK), a Fortune 500 company headquartered in Richmond, Va., is an integrated paper and forest products company.
 Chesapeake's primary businesses include tissue and kraft paper products and packaging. Other businesses are treated wood, land development and consumer tissue products.
 Percent
 Second Quarter 1992 1991 Change
 Net Sales $229,294,000 $218,829,000 5
 Income from
 Operations 14,220,000 13,233,000 7
 Interest Expense 7,541,000 8,883,000 -15
 Income Before Taxes 7,155,000 4,280,000 67
 Income Taxes 2,862,000 1,849,000 55
 Net Income 4,293,000 2,431,000 77
 Earnings per Share $0.18 $0.12 50
 Weighted average shares
 and equivalents
 outstanding 23,234,000 20,468,000
 Percent
 Year to Date 1992 1991 Change
 Net Sales $439,429,000 $417,268,000 5
 Income from
 Operations 25,565,000 26,094,000 -2
 Interest Expense 16,040,000 17,789,000 -10
 Income Before Taxes 11,348,000 8,607,000 32
 Income Taxes 4,539,000 3,727,000 22
 Net Income 6,809,000 4,880,000 40
 Earnings per Share $0.30 $0.24 25
 Weighted average shares
 and equivalents
 outstanding 22,021,000 20,456,000
 -0- 7/23/92
 /CONTACT: Andrew J. Kohut, Chief Financial Officer, Chesapeake Corporation, 804-697-1153/
 (CSK) CO: Chesapeake Corporation ST: Virginia IN: PAP SU: ERN


CM -- CH003 -- 2303 07/23/92 09:12 EDT
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Date:Jul 23, 1992
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