Eastern Company Anticipates Record Third Quarter Results


NAUGATUCK, Conn.--(BUSINESS WIRE)--Sept. 29, 1998--The Eastern Company (AMEX:EML) today announced that it anticipates it will report third quarter net income of approximately $1,400,000, or between $0.55 and $0.60 per basic share. This compares to 1997 third quarter net income of $1,067,000 or $0.40 per basic share. Sales for the third quarter of 1998 are expected to be in the range of $17.5 million to $18 million, compared with $16.7 million in 1997. Eastern's expected third quarter performance will be the seventh consecutive quarter that the company's earnings have increased.

This will also be the seventh consecutive quarter the company has reported both higher sales and higher earnings than in the previous year.

Mr. Leonard F. Leganza, CEO and President stated, "Our earnings performance will reflect a combination of higher sales and increased operating efficiencies at our various facilities. A highlight has been the continued growth and strength at our Eberhard division's two manufacturing facilities in Ohio and Canada. Eberhard is the leading producer of locking bars and other vehicular hardware for truck trailers. Production of these locking bars at Eberhard's Canadian operations is more than 40 percent higher than last year. To accommodate this increased activity, a 10,000 square foot expansion of its production facility is under way."

Mr. Leganza concluded, "As a result of these expectations for the third quarter, we anticipate that the Company's sales and earning performance for 1998 will continue to reach record levels. Our overall incoming orders and backlogs continue to remain firm. During the fourth quarter, we are looking forward to the introduction of the new Excelsior-Henderson heavyweight touring motorcycle, which will include two different locks produced by our Illinois Lock division. Our Mexican distributorship continues to expand its business in that country's emerging security hardware market. In addition, we are continuing to carefully evaluate potential acquisitions and other strategic alliances in order to further expand our current market positions or enable us to enter new, but related markets."

Eastern expects to release its third quarter results during the week of October 11, 1998.

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. It has paid consecutive quarterly dividends since 1940.

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.

     CONTACT: The Eastern Company
              John Dibble, 203-729-2255