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Gerber Technology Reports Continued Profit Growth

From: ASAP

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Gerber Technology today announced profits of $13.4 million and revenues of $154.1 million for its fiscal year ended April 30, 2003, compared with profits of $10.5 million and revenues of $158.1 million in the prior year. During the year the company continued to support established apparel and industrial markets in North America and Western Europe with key new software releases and expanded customer service. Gerber also grew its leadership position in Asia, Mexico and Central America through broadened market coverage and innovative products designed for rapidly growing businesses in these regions.

“Our business results reflect what’s happening in the global market,” said James Arthurs, President of Gerber Technology. “Our market share has increased steadily in developing markets in recent years, especially in China, Southwest Asia and Latin America where we have strengthened our leadership position. With improved operational efficiencies and the launch of new products and services, our profits are up 27 percent over last year. This enables our company to continue to dedicate itself to the research and development of innovative products, and to expand our sales and service network even further.”

In addition to its own direct operations, Gerber operates globally, via a highly developed network of agents and distributors, which, this year, represents 26 percent of the company’s sales. Sales via agents and distributors were most significant in Turkey, Japan, Spain, Scandinavia, India and Brazil.

Arthurs added, “We realize that employing a direct sales model in these regions would certainly improve our overall direct revenue. However, we feel that our long-standing agent and distributor network is a true business advantage for our customers. We currently maintain offices, agents and distributors in more than 115 countries, staffed with knowledgeable individuals who speak the local language and understand their markets’ challenges and opportunities. Ongoing Global Expansion Throughout the year, Gerber Technology continued to expand operations globally to meet the needs of rapidly developing markets, particularly in China, India, Mexico and Central America. In January, 2003, the company opened an office in Ningbo, China bringing its total number of offices in the country to 15, the most of any CAD/CAM supplier. In the same month, Gerber also established a regional office in Bangalore, India to serve as a liaison for agents and distributors in 20 countries throughout the Indian subcontinent, Middle East and sub-Saharan Africa. Additionally, Gerber increased its total number of offices in Mexico to 7 and expanded customer service operations in Central America, with the inauguration of a full-service center in Honduras.

New Product Introductions This year Gerber launched several key new products including its next generation of AccuMark® - V8. AccuMark is the apparel industry’s global benchmark for pattern design, grading and marker making and is quickly becoming the software of choice for the transportation interiors and furniture markets. In addition to many new features, this release facilitates pattern data interchange with most CAD systems through ASTM and AAMA standards via a new Pattern Conversion Wizard. It also enables effortless conversion to widely-used formats such as DXF and the HPGL plotting standard.

AccuMark AE, launched in May 2002 and designed specifically for first-time automaters in India and China, is now available worldwide. This is particularly important to Gerber’s strategy of supporting the industry’s need for “Full Package” capabilities (the ability of the “brand company’s” contractors and production centers to design and grade patterns independently).

The GT1000 GERBERcutter®, launched early in fiscal year 2003, exceeded sales expectations and received strong acceptance by made-to-measure manufacturers. On the industrial front, the company released new versions of its CutWorks™ single-ply production software, as well as GERBERinfojet™, a new inkjet part identification system. Intensive development work in the hardware arena during the year has also positioned the company well for new product launches scheduled for fiscal year 2004.

New releases of the company’s WebPDM™ product lifecycle management software product were also met with enthusiasm. WebPDM V4 provides enhanced solutions for apparel companies to speed time to market and increase the efficiency of the complicated product development and management processes. The adoption of global, real-time, web-based product lifecycle management tools is expected to increase as international travel becomes more challenging and uncontrollable events, like the spread of the SARS virus, continue to occur. Gerber also launched WebPDM in a ready-to-use configuration named WebPDM SP. WebPDM is the apparel industry’s product lifecycle management standard and has captured more than a 60 percent market share.

Gerber Technology directly employs more than 135 individuals in its product management and engineering groups and commits over $14 million in resources annually to R&D activities. This investment is augmented by significant additional investments made by Gerber’s alliances and partners.

Arthurs added, “With the World Trade Organization’s cessation of trade quotas in 2005, many companies realize that, in order to compete in a free trade environment, they must automate to remain competitive. In the 35 years since we were founded, we have helped more than 13,000 customers automate their operations and improve profitability. Our product development focus this year supports our legacy of providing solutions driven by our customers’ global needs.”

Market Alliances Strengthen GERBERsuite® During the year Gerber Technology strengthened alliances with “best of breed” companies to supply products that complement its core GERBERsuite offerings. These include Browzwear Ltd.’s V-Stitcher™ product for 3-D visualization, NedGraphics’ Vision Fashion Studio™ software for conceptual design, and Nester Software Technologies’ NESTERserver™ for material optimization. The company also strengthened its alliance with Eton System AB, the premier supplier of unit production systems in the world.

Innovative New Customer Service Offerings In fiscal year 2003 Gerber Technology expanded its “Customer First” commitment with the launch of GERBERnet™, a new customer service portal which provides internet-based tools to improve productivity. GERBERnet includes software updates and downloads, online parts ordering, a technical information library and previously-owned equipment auction site. In addition, a powerful new Problem Report and Enhancement Utility within AccuMark V8 makes it easier to suggest improvements, ask technical questions or report software issues directly via the Internet. The company plans to add significant new services to GERBERnet during the coming year. Access to GERBERnet is provided via www.gerbertechnology.com.

The company also made significant advancements in improving operational efficiencies by integrating manufacturing, customer service and information technology operations of some of Gerber Scientific’s other businesses with Gerber Technology. These moves have expanded service coverage and accelerated the delivery of products and parts to customers.

Parent Company, Gerber Scientific, Also Experiences a Strong Year: Completes Refinancing Gerber Technology is one of four businesses of Gerber Scientific, a NYSE listed company. On May 29, 2003, Gerber Scientific reported revenues of $512.4 million compared with revenues of $498.9 million one year ago, and after-tax income from continuing operations of $8.2 million, up from a loss of $5.9 million last year. The company also reduced its debt by $42.1 million for the fiscal year and secured a four-year $110.0 million senior credit facility arranged by Fleet Securities, Inc., completing its planned refinancing on schedule. At the time of this release, the company’s stock was valued at $7.40 compared to $3.60 one year ago.

AccuMark, GERBERcutter and GERBERsuite are registered trademarks of Gerber Technology. WebPDM™, InfoJet™, CutWorks™ and GERBERnet™ are trademarks of Gerber Technology. V- Stitcher™ is a trademark of Browzwear Ltd. Fashion Studio™ is a trademark of NedGraphics, Inc. NESTERserver is a trademark of Nester Software Technologies, Inc.

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About Gerber Technology

Gerber Technology (www.gerbertechnology.com), a business unit of Gerber Scientific, Inc., is the world leader in providing integrated computer hardware and software systems to the sewn-goods and flexible goods industries. These systems significantly improve the efficiency of information management, product and pattern design, grading and marker making/nesting and material spreading, handling and cutting processes. The company offers automation solutions to a variety of industries including apparel, transportation, furniture, composites and industrial fabrics. Gerber Technology’s world headquarters is located in Tolland, Connecticut, U.S.A. with regional offices, agents and distributors located in more than 115 countries serving a total of over 13,000 customers globally. Established in 1968, Gerber Technology is one of four businesses of Gerber Scientific, Inc. (www.gerberscientific.com) of South Windsor, Connecticut, listed on the New York Stock Exchange under the “GRB” symbol.

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