The Eastern Company Continues to See Strong Sales and Earnings Growth

7/1/1999 12:04:00 PM

NAUGATUCK, Conn.--(BUSINESS WIRE)--July 1, 1999--The Eastern Company (AMEX:EML) stated today that its business remains strong and that it is on target for another year of solid growth in both sales and earnings. The Company's optimistic outlook and solid financial position were important factors for declaring two dividend increases over the past 12 months as well as a three-for-two stock split that became effective June 15, 1999.

Eastern has grown from $57.9 million in sales in 1996 to $70.8 million in 1998. Earnings have expanded at an even faster rate-from $0.33 per basic share in 1996 to $2.24 per basic share in 1998.

Leonard F. Leganza, President and CEO, stated, "The introduction of new, higher margin security products, the addition of new customers and a growing demand for the Company's vehicular hardware by the truck body industry have all contributed to this growth. Of particular note are the sustained high levels of demand of our locks and latches used on sport utility and pickup trucks and also on locking systems which secure personal computer networks."

Mr. Leganza continued, "In view of the continuing strength of incoming orders and backlogs in all of our three product segments, we expect that Eastern's sales and earnings momentum will continue at a record level through the remainder of 1999. On a POST-SPLIT basis, we anticipate a 15% to 20% growth in second quarter earnings per share as compared to the same period in 1998 while sales for this same period are expected to increase about 10% to 15%. As a result, sales and net earnings for the first half of this year should be in the range of $40 million and $3 million respectively. This compares to last year's results of $35.8 million and $2.6 million."

Eastern expects to announces its second quarter results during the week of July 12, 1999.

The Eastern Company manufactures and markets a broad range of locks, latches, fasteners and other security hardware that meets diverse security and safety needs of industrial and commercial customers. Headquartered in Naugatuck, CT, the Company has seven manufacturing locations in the U.S.A., Canada, Mexico and the Pacific Rim.

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.

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     CONTACT: The Eastern Company
              John Dibble
              (203)729-2255, ext. 102