The Eastern Company Reports Results for the Second Quarter of 2002

7/16/2002 10:28:00 AM

NAUGATUCK, Conn., Jul 16, 2002 (BUSINESS WIRE) -- The Eastern Company (AMEX:EML) today announced its operating results for the second quarter. Sales for the second quarter of 2002 increased slightly to $21.3 million, compared to $20.7 last year. Second-quarter net income increased to $758,500, or $.20 per diluted share compared to the $550,000 or $ .15 per diluted share reported in the second quarter of 2001, a 38% increase.

Year-to-date earnings for the six-month period ended June 29 were $1.4 million or $.38 per diluted share, compared to $1.7 million or $.46 per diluted share for the same period in 2001. Net sales for six months were $41.6 million compared to $43.4 million for the first six months of the previous year.

Leonard F. Leganza, President and CEO stated, "While the operating results in the second quarter of 2002 were improved compared to the second quarter of 2001, the economy has not yet rebounded as earlier expected and continues to adversely affect most of the market sectors in which we operate. Our metal casting segment has also been effected by the strong U. S. dollar, which facilitates greater foreign competition. In addition, the relatively mild winter which resulted in reduced energy demands and thus less demand for coal has also lessened the demand for our proprietary mine roof anchors which are used in supporting the roofs in underground coal mines."

Mr. Leganza further commented, "Although we expect the third quarter to continue to be affected by a sluggish economy and softness in the coal industries we will continue to invest in our sales, marketing, product development and other areas for the development of future growth, notwithstanding these economic conditions."

The Eastern Company is a 144-year-old manufacturer of industrial hardware, security products and metal castings. It operates from nine locations in the U.S., Canada, Mexico, Taiwan and China. The diversity of the Company's products enables it to respond to the changing requirements of a broad array of markets.

Forward-Looking Statements: Information in this news release contains statements which reflect the Company's current expectations regarding its future operating performance and achievements. Actual results may differ due to the many economic uncertainties that affect the Company's business environment. Further information about the potential factors, which could affect the Company's financial results, are included in the Company's reports and filings with the Securities and Exchange Commission. The Company is not obligated to update or revise the aforementioned statements for those new developments.

Statement of Consolidated Income (unaudited)
                        THREE Months Ended        SIX Months Ended
                       13 wks       13 wks       26 wks       26 wks
                      June 29,     June 30,     June 29,     June 30,
                        2002         2001         2002         2001
                    -----------  -----------  -----------  -----------
Net Sales           $21,291,745  $20,690,102  $41,612,262  $43,367,024
Net Income          $   758,518  $   550,215    1,435,625    1,702,087
Net Income Per Share:
     Basic          $      0.21  $      0.15  $      0.40  $      0.47
     Diluted        $      0.20  $      0.15  $      0.38  $      0.46
Weighted average
 shares outstandings:
     Basic            3,630,586    3,621,569    3,629,931    3,620,765
     Diluted          3,717,031    3,690,577    3,729,542    3,696,274

The Eastern Company
Leonard F. Leganza or John L. Sullivan III
(203) 729-2255