DES PLAINES, IL -- 03/10/08 --
Schawk, Inc. (NYSE: SGK), one of the
world's leading providers of digital imaging graphic services to the
consumer products and brand imaging markets, today announced that it will
delay the distribution of its fourth-quarter and full-year 2007 earnings
release and the related conference call and webcast, which had been
scheduled to take place on Tuesday, March 11, 2008.
The Company has delayed its earnings announcement so that management, under
the direction of the Company's Audit Committee and in consultation with the
Company's independent auditors, can complete its review of the
capitalization of certain costs from 2006 related to the development of
software for internal use. The Company has recorded approximately $1.4
million of expense in the fourth quarter of 2007 related to the development
of software for internal use, which amounts had been capitalized earlier in
the year. With respect to 2006, the Company has determined that it must
expense $1.0 million of previously capitalized costs (after reversal of the
related depreciation expense) and may be required to expense an additional
$800 thousand to $1.5 million of previously capitalized costs (also after
reversal of the related depreciation expense) for that year.
Part of the Company's review also includes an analysis of certain other
accounting matters, primarily involving the timing of the recognition of
revenue and costs at its digital solutions business, which business
represents approximately 1.8 percent of the Company's revenue. These
matters are unrelated to the write-off of software for sale to third
parties utilized by the Company's digital solutions business, as those
amounts were fully written off in the third quarter of 2007.
The amounts described above are preliminary only and reflect the Company's
current expectations. The Company cannot give assurance that such amounts
will not change, or that additional items will not have arisen, once the
Company has completed its review. Upon the completion of such review, the
Company will determine whether any necessary adjustments, together with
previously announced adjustments, will require the Company to restate
prior-period financial statements. The Company also anticipates that it
will be unable to timely file its Annual Report on Form 10-K when due on
March 17, 2008, until the appropriate treatment of these accounting matters
is determined.
A subsequent press release will be issued announcing a new date and time
for the distribution of fourth quarter and full year 2007 results and
timing for filing the Annual Report on Form 10-K.
About Schawk, Inc.
Schawk, Inc., headquartered in suburban Chicago, is one of the world's
largest independent brand image solutions companies. Schawk delivers a
broad range of digital pre-media graphic services through 153 locations in
12 countries across North America, Europe, Asia and Australia. Schawk
designs, creates and manages images and text for reproduction to exact
specifications for a variety of media, including packaging for consumer
products, point-of-sale displays and other promotional and advertising
materials. Schawk provides its services to the food, beverage, health &
beauty, pharmaceutical, home care and consumer products industries. For
more information, visit www.schawk.com.
Safe Harbor Statement
Certain statements in this press release are forward-looking statements
within the meaning of Section 21E of the Securities and Exchange Act of
1934, as amended and are subject to the safe harbor created thereby. These
statements are made based upon current expectations and beliefs that are
subject to risk and uncertainty. Actual results might differ materially
from those contained in the forward-looking statements because of factors,
such as, among other things, our ability to timely complete our review of
the accounting matters described herein or the discovery of additional
accounting issues, which could cause our investors to lose confidence in
our reported financial information and could have a negative impact on the
trading price of our stock, as well as other factors detailed in Schawk,
Inc.'s filings with the Securities and Exchange Commission.
AT SCHAWK, INC.:
James J. Patterson
Sr. VP and CFO
847-827-9494
jpatterson@schawk.com
AT DRESNER CORPORATE SERVICES:
Kristine Walczak
312-780-7205
kwalczak@dresnerco.com
