Virco Announces Acquisition of Certain Assets of Corex Products, Inc. TORRANCE, Calif., Dec. 19 Virco Mfg. Corporation announced today that it has
acquired certain assets of Corex Products, Inc., in the following letter to
shareholders from Robert A. Virtue, President and CEO: Despite the current downturn in the classroom market, we have continued to seek
prudent acquisitions that strengthen our ability to meet the functional and
seasonal demands of our customers. Following recent decisions by several major
accounts to switch from thermoplastic to hard plastic chairs and desks, we
decided to add capacity for making these parts. Today we signed agreements with
the owner and secured lender of Corex Products, Inc., to acquire particular
machines, molds and a pending patent that will give us that capacity. The
purchase price was $1,000,000.
Hard plastic is an extremely durable material made from finely ground wood
flour, pigments and melamine resin. It is molded into seats, backs and writing
surfaces for classroom chairs and desks. Hard plastic furniture currently
represents about 20% of our total revenue, but demand in this segment is
increasing as more districts try to maximize the price-value relationship of
their furnishings. Several new product lines slated for release in 2004 and
2005 will also make use of hard plastic components.
This acquisition fits easily within our capital expenditure budget and will not
prevent us from reaching our goal of having less total debt by year-end.
As we have said in prior reports, the recession in our market may create as many
opportunities as challenges. With our restructuring complete and the prospect
of stable demand in 2004, our emphasis now is on growth. The acquisition of
certain Corex assets is strategically consistent with our goal of providing the
highest value furniture and equipment for educators. By concluding the purchase
in December we have allowed enough time to relocate equipment and build
components for summer delivery.
All statements in this press release that do not directly and exclusively relate
to historical facts constitute "forward-looking statements" within the meaning
of the Private Securities Litigation Reform Act of 1995. These statements
represent the Company's intentions, plans, expectations and beliefs, and are
subject to risks, uncertainties and other factors, many of which are outside the
Company's control. These factors could cause actual results to differ
materially from such forward-looking statements. For a written description of
these factors, see the section titled "Management's Discussion and Analysis of
Financial Conditions and Results of Operations" in the Company's Form 10-Q for
the quarter ended October 31, 2003. The Company disclaims any intention or
obligation to update these forward-looking statements whether as a result of
subsequent events or otherwise except as required by law.
For further information, please contact: Robert A. Virtue, President, or Douglas
A. Virtue, Executive Vice President, or Robert E. Dose, Chief Financial Officer,
all of Virco Mfg. Corporation, +1-310-533-0474. DATASOURCE: Virco Mfg. Corporation CONTACT: Robert A. Virtue, President, or Douglas A. Virtue, Executive Vice President, or Robert E. Dose, Chief Financial Officer, all of Virco Mfg.
Corporation, +1-310-533-0474 Company News On-Call: http://www.prnewswire.com/comp/904013.html
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