OUTL Outlook (MM)

Outlook Group Corp. (Nasdaq:OUTL) today reported results for the fourth quarter and fiscal year ended May 31, 2006. Fourth Quarter Fiscal 2006 Highlights -- Net sales for the fourth quarter of fiscal 2006 were $22,510,000, a 3.4% increase from sales of $21,761,000 for the same period in the prior year. -- Net earnings were $388,000 or $0.11 per diluted share for the fourth quarter of fiscal 2006, compared to earnings of $676,000 or $0.20 per diluted share for the comparable prior period. -- Net earnings for the fourth quarter of fiscal 2006 include expenses of $345,000 or $0.10 per diluted share related to the proposed acquisition of Outlook Group by Vista Group Holdings LLC. Most of the acquisition-related expenses are non-deductible for tax purposes. Full Year Fiscal 2006 Highlights -- Net sales for fiscal 2006 were $85,936,000, a 13.7% increase from sales of $75,589,000 for fiscal 2005. -- Net earnings were $2,248,000 or $0.65 per diluted share for fiscal 2006, compared to earnings of $3,227,000 or $0.94 per diluted share for the prior fiscal year. -- The fiscal 2005 earnings included after-tax recovery of a prior period bad debt of $722,000 or $0.21 per diluted share. -- The fiscal 2006 earnings include expenses of $509,000 or $0.15 per diluted share related to the proposed acquisition of Outlook Group by Vista Group Holdings LLC. A special meeting of Outlook Group shareholders to vote on the proposed acquisition will be held on July 19, 2006. Subject to the shareholder vote, Vista financing and other closing conditions, Outlook Group expects that the transaction will close in July. About Outlook Group Outlook Group Corp. is a printing, packaging and direct marketing company offering a variety of related services to clients in markets including contract packaging, collateral information management and distribution, direct marketing components and services, packaging components and materials and specialty print related services. The company leverages its core competencies by cross-selling services to provide a single-source solution for its clients. Outlook Group shareholders are urged to read the proxy statement for the July 19, 2006 special meeting of shareholders for the purpose of voting on the proposed acquisition. This proxy statement has been filed with the Securities and Exchange Commission and has been mailed to all shareholders. Interested persons can obtain the proxy statement free of charge at the Securities and Exchange Commission's website at www.sec.gov. The discussions of potential future transactions and the effects of those transactions in this press release are "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to certain risks and uncertainties which could cause actual results to differ materially from those anticipated. In particular, consummation of the proposed acquisition is subject to a number of conditions, including the Outlook Group shareholder vote, Vista's financing and other customary conditions, as further described in the proxy statement. Therefore, as with any transaction, completion cannot be assured. In addition, Outlook Group's periodic filings with the Securities and Exchange Commission discuss a number of other factors which may affect its future operations. Outlook Group shareholders and other readers are urged to consider these factors carefully in evaluating the forward-looking statements. The statements made herein are only made as of the date of this press release and neither Outlook Group nor Vista undertakes any obligation to publicly update such statements to reflect subsequent events or circumstances. -0- *T OUTLOOK GROUP CORP. AND SUBSIDIARIES Condensed Consolidated Statements of Operations (Unaudited) ----------------------------------------------------------- (in thousands, except share and per share amounts) Three-Month Twelve-Month Period Ended Period Ended --------------------- --------------------- May 31, May 31, May 31, May 31, 2006 2005 2006 2005 ---------- ---------- ---------- ---------- Net sales $22,510 $21,761 $85,936 $75,589 Cost of goods sold 18,183 17,442 69,708 60,113 ---------- ---------- ---------- ---------- Gross profit 4,327 4,319 16,228 15,476 Recovery of bad debt - - - (1,214) Selling, general and administrative expenses 3,385 3,001 11,934 11,122 ---------- ---------- ---------- ---------- Operating profit 942 1,318 4,294 5,568 Other income (expense): Interest expense (169) (73) (485) (225) Interest and other income 29 30 93 80 ---------- ---------- ---------- ---------- Earnings from operations before income taxes 802 1,275 3,902 5,423 Income tax expense 414 599 1,654 2,196 ---------- ---------- ---------- ---------- Net earnings $388 $676 $2,248 $3,227 ========== ========== ========== ========== Earnings per common share: Basic $0.11 $0.20 $0.66 $0.95 ========== ========== ========== ========== Diluted $0.11 $0.20 $0.65 $0.94 ========== ========== ========== ========== Weighted average number of shares outstanding: Basic 3,401,199 3,385,477 3,395,144 3,385,477 ========== ========== ========== ========== Diluted 3,477,752 3,436,011 3,472,363 3,431,945 ========== ========== ========== ========== Selected Consolidated Balance Sheet Data (Unaudited) ---------------------------------------------------- (Dollars in thousands) May 31, 2006 May 31, 2005 ------------ ------------ Ratio Analysis -------------- Total current assets $23,005 $23,977 Total current liabilities $12,441 $11,122 Total long-term debt (including current maturities) $6,425 $5,350 Shareholders' equity $34,844 $33,106 Current ratio 1.85 2.16 Long-term debt to total capitalization 15.6% 13.9% *T