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Cenveo Reports Sales, Income Up Primarily Due to Nashua Acquisition

August 11, 2010
STAMFORD, CT—August 11, 2010—Cenveo, Inc. (NYSE: CVO) today announced results for the three and six months ended July 3, 2010. For the three months ended July 3, 2010, net sales increased approximately 12% to $445.3 million, as compared to $397.6 million in the second quarter of 2009, primarily due to the Nashua Corp. acquisition. For the six months ended July 3, 2010, net sales increased approximately 11% to $899.2 million, as compared to $809.7 million in the six months ended June 27, 2009, primarily due to the Nashua acquisition and the fact that there was one more week in the six month period ended July 3, 2010 as compared to the six months ended June 27, 2009.

The company generated operating income of $19.4 million in the second quarter of 2010, compared to an operating loss of $5.5 million in the second quarter of 2009. For the six months ended July 3, 2010, it generated operating income of $31.6 million, compared to an operating loss of $5.3 million in the six months ended June 27, 2009. These increases were primarily due to lower restructuring and impairment charges and the acquisition of Nashua.

For the three months ended July 3, 2010, non-GAAP operating income increased 10.1% to $37.8 million compared to $34.3 million in the same prior year period. For the six months ended July 3, 2010, non-GAAP operating income increased 39.6% to $67.6 million compared to $48.4 million in the same prior year period. These increases were primarily due to our cost savings initiatives in 2009 and early 2010 and the acquisition of Nashua. Non-GAAP operating income excludes integration, acquisition and other charges, stock-based compensation provision, restructuring and impairment charges and divested operations or assets held for sale.

Adjusted EBITDA in the second quarter of 2010 was $54.0 million compared to $53.1 million in the second quarter of 2009. Adjusted EBITDA in the second quarter of 2009 had the benefit of two one-time items (salary furlough for management and gain from a sale of a cost-method investment) that did not repeat in 2010. Excluding these two items, our Adjusted EBITDA increased approximately 15% over the same prior year period. Adjusted EBITDA for the first six months of 2010 was $99.5 million compared to $84.6 million in the same prior year period. Excluding the two items discussed above, Adjusted EBITDA for the first six months of 2010 increased approximately 27% over the same prior year period. Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization, excluding integration, acquisition and other charges, stock-based compensation provision, restructuring and impairment charges, divested operations or assets held for sale, (gain) loss on early extinguishment of debt, and loss from discontinued operations, net of taxes. An explanation of the Company’s use of Adjusted EBITDA is detailed below and a reconciliation of net loss to Adjusted EBITDA is provided in the attached tables.
 

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