The Eastern Company Reports Results for 2001 Year-End and Fourth Quarter

1/23/2002 1:08:00 PM

NAUGATUCK, Conn.--(BUSINESS WIRE)--Jan. 23, 2002--The Eastern Company (AMEX-EML) today announced the results of its fourth quarter and full year 2001 operations. Sales for the full year 2001 were $82.8 million, which is a decrease of 6.1 percent when compared to sales of $88.2 million in 2000. Sales for the fourth quarter of 2001 were $18.9 million, compared to $ 23.0 million in 2000, a decrease of 17.6%.

For the full year 2001 net income decreased to $3.9 million or $1.08 per basic share, compared to net income of $7.1 million or $1.95 per basic share, in 2000. Fourth-quarter net income will be $1.7 million, or $.46 per basic share which is comparable to the $1.8 million or $.51 per basic share reported in the fourth quarter of 2000.

Leonard F. Leganza, President and CEO, stated, "Earnings in the fourth quarter and full year were effected favorably, $.11 per basic share, as a result of lower than anticipated utility and compensation expenses. In addition, as part of Prudential Financial Inc.'s conversion from a mutual insurance company to a stockholder owned company, The Eastern Company, a policyholder, received approximately 26,000 shares of common stock. Recognizing this gain increased net income by approximately $450,000 or $.12 per basic share." Leganza continued, "Notwithstanding the above, our metal casting group experienced improved earnings during the year as sales of our proprietary mine roof support anchors increased from prior years levels."

The Eastern Company is a 144-year-old leading manufacturer of vehicular and industrial hardware, locks, metal castings, coin collection and smart card products. 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 result 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        TWELVE Months Ended

                     13 wks        13 wks        52 wks        52 wks
                    Dec. 29,      Dec. 30,      Dec. 29,      Dec. 30,
                       2001          2000          2001          2000

Net Sales       $ 18,907,168  $ 22,958,047  $ 82,825,353  $ 88,192,294

Net Income
 After Tax         1,681,560     1,840,004     3,912,919     7,055,489

Net Income Per Share:
    Basic           $   0.46      $   0.51      $   1.08      $   1.95
    Diluted         $   0.46      $   0.50      $   1.07      $   1.93

Weighted average shares outstandings:
    Basic          3,627,385     3,618,007     3,623,291     3,621,449
    Diluted        3,627,385     3,662,476     3,667,179     3,660,923


CONTACT: The Eastern Company
Leonard F. Leganza or John L. Sullivan III