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G&K SERVICES TURNS IN STRONG THIRD QUARTER; CONTINUED GAINS EXPECTED IN FINAL QUARTER OF FISCAL 1993

 MINNEAPOLIS, April 27 /PRNewswire/ -- G&K Services, Inc. (NASDAQ-NMS: GKSRA) today reported a strong third quarter in which net income rose 45 percent over the prior period, reflecting double-digit revenue growth in U.S. operations and substantial improvement in Canadian operations. The Minneapolis-based uniform leasing company said it expects further earnings progress in the final quarter of this fiscal year.
 Net earnings for the quarter ended March 27, 1993, were $2,542,000, or 19 cents per share, compared with $1,751,000, or 13 cents per share, in the year earlier period. Revenues rose 5 percent to $51,002,000 from $48,599,000 in the third quarter of fiscal 1992.
 Nine months net earnings were $7,489,000, or 55 cents per share, a gain of 17 percent over the $6,419,000, or 48 cents per share, earned in the year earlier period. Revenues reached $151,156,000, up 4 percent from $145,810,000 in the prior year.
 Chairman and CEO Richard Fink said, "We were particularly pleased by the growth of our U.S. revenues, which increased more than 10 percent over last year. While an improved economy certainly helped, the higher growth rate was primarily a function of strong new account additions and a high retention rate on existing accounts." Fink noted that this revenue increase was achieved in the absence of new location openings, giving G&K one of the best internal growth rates among its leading competitors in the $3 billion U.S. uniform leasing industry.
 "Canadian revenues were down 11 percent from the year earlier quarter due to a continued weak economy and a sharp swing in the Canadian-U.S. exchange rate," Fink said. "When currency translations are factored out, revenues were down only 5 percent, continuing a trend toward the stabilization of Canadian revenues.
 "We are encouraged by this quarter's earnings performance, which represents a sharp turnaround in Canadian operating income over the prior year, as well as continued strong results from our U.S. locations." Fink added that consolidated earnings also benefited from reduced interest costs as a result of lower interest rates and borrowing levels compared with a year ago.
 "We expect these trends to continue in the next quarter, providing a strong finish to the 1993 fiscal year," Fink concluded.
 G&K Services is one of North America's largest suppliers of uniforms and related textile products. In the United States, the company operates in 23 states, serving customers from 21 processing plants and 27 sales and service centers. In Canada, G&K serves customers from 22 locations, including 9 processing plants in the provinces of Ontario and Quebec.
 To receive the latest information about G&K Services, Inc. via FAX, at no cost, dial 1-800-PRO-INFO, code 078.
 G&K SERVICES, INC. and SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF INCOME
 (In thousands, except per share amounts)
 (Unaudited)
 For the Three For the Nine
 Months Ended Months Ended
 March 27, March 28, March 27, March 28,
 1993 1992 1993 1992
 REVENUES $51,002 $48,599 $151,156 $145,810
 EXPENSES
 Operating 28,218 26,815 84,435 82,528
 Cost of
 merchandise sold 1,521 1,128 4,236 3,388
 Selling and
 administrative 11,471 12,077 34,049 32,863
 Depreciation 2,950 2,781 8,426 8,151
 Amortization of
 intangibles 757 785 2,294 2,371
 44,917 43,586 133,440 129,301
 INCOME FROM
 OPERATIONS 6,085 5,013 17,716 16,509
 Interest expense 1,785 2,070 5,318 6,433
 Interest income (95) (88) (258) (248)
 Other (income)
 expense, net 147 35 224 (708)
 INCOME BEFORE INCOME TAXES
 Provision for
 income taxes 1,706 1,245 4,943 4,613
 NET INCOME $2,542 $1,751 $7,489 $6,419
 Weighted Average Number of
 shares outstanding 13,545 13,494 13,518 13,488
 INCOME PER SHARE $0.19 $0.13 $0.55 $0.48
 -0- 4/27/93
 /CONTACT: Richard Fink, chairman, G&K Services, 612-546-7440; Nick Farina at The Financial Relations Board, 312-266-7800, for G&K; or Karen Griffiths 212-661-8030/
 (GKSRA)


CO: G&K Services, Inc. ST: Minnesota IN: SU: ERN

KH -- MN013 -- 1322 04/27/93 11:39 EDT
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Date:Apr 27, 1993
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