UFP Technologies Announces Record Q2 2008 Results

GEORGETOWN, Mass.--(Business Wire)--
UFP Technologies, Inc. (Nasdaq: UFPT), a manufacturer of packaging
and component products, today reported net income of $1,574,000 or
$0.25 per diluted common share outstanding for its second quarter
ended June 30, 2008, compared to net income of $977,000 or $0.17 per
diluted common share outstanding for the second quarter of 2007. Sales
for the quarter were $28.5 million compared to 2007 second quarter
sales of $23.2 million. For the six-month period ended June 30, 2008,
the Company reported a profit of $2.7 million or $0.44 per diluted
common share outstanding, compared to $1.5 million or $0.26 per
diluted common share outstanding in the same period last year. Sales
for the six-month period ended June 30, 2008, were $56.5 million
compared to 2007 sales of $45.2 million.

"I am very pleased with our continued progress," said R. Jeffrey
Bailly, Chairman, CEO and President. "Our 23% sales increase includes
solid internal growth of 9%, coupled with gains from our January
acquisition of Stephenson & Lawyer in Grand Rapids, Michigan. When you
factor in the impact of our ongoing operational improvements, the
result is a dramatic 61% increase in net profits for the quarter."

"The integration of Stephenson & Lawyer has been smooth, and
should bring further efficiencies as the process continues," said
Bailly. "For instance, over the next six months, we plan to
consolidate our Detroit area automotive plant into S&L's 250,000
square foot Grand Rapids facility, which should easily accommodate the
entire Detroit operation." Bailly estimates the move will cost
approximately $1.6 million and save the company approximately $1.2
million per year, thus paying for itself in an estimated 16 months.

"I am also excited about our recent new business activity," Bailly
added. "For example, UFP Technologies, Armstrong Tools, and Pelican
Case were jointly awarded a significant contract from the U.S. Army
and Marines to build mobile tool kits. This five-year program,
currently expected to generate about $6 million in revenue for our
company, is an excellent example of the high value-added programs we
are targeting."

UFP Technologies is a leading designer and manufacturer of
interior protective packaging solutions using molded fiber,
vacuum-formed plastics, and molded and fabricated foam plastics. The
Company also designs and manufactures engineered component solutions
using laminating, molding, and fabricating technologies. The Company
primarily serves the automotive, computers and electronics, medical,
aerospace and defense, consumer, and industrial markets.

This news release contains forward-looking information that
involves risks and uncertainties, including statements about the
Company's prospects, anticipated advantages the Company expects to
realize from its acquisition and integration of Stephenson & Lawyer,
costs expected to be incurred and savings anticipated to be realized
in connection with the Company's planned plant consolidation, the
expected timing for the Company to realize such savings, the expected
revenues from the new contract with the U.S. Army and Marines, the
Company's growth potential and the Company's strategies for growth.
Investors are cautioned that such forward-looking statements involve
risks and uncertainties, including without limitation risks associated
with achieving anticipated cost savings and other benefits associated
with the plant consolidation in the anticipated time frame, the
identification of suitable acquisition candidates and the successful,
efficient execution of acquisition transactions and integration of any
such acquisition candidates, including Stephenson & Lawyer, as well as
other risks and uncertainties that are detailed in the documents filed
by the Company with the SEC. Accordingly, actual results may differ
materially. Readers are referred to the documents filed by the Company
with the SEC, specifically the last reports on Forms 10-K and 10-Q.
The forward-looking statements contained herein speak only of the
Company's expectations as of the date of this press release. The
Company expressly disclaims any obligation or undertaking to release
publicly any updates or revisions to any such statement to reflect any
change in the Company's expectations or any change in events,
conditions or circumstances on which any such statement is based.

Consolidated Condensed Statements of Income

($ in thousands, except Per Share Data)

Unaudited

-0-
*T
Three Months Six Months
Ended Ended
30-Jun- 30-Jun- 30-Jun- 30-Jun-
08 07 08 07
------- ------- ------- -------
Net sales $28,456 $23,180 $56,464 $45,193
Cost of sales 20,828 17,395 41,948 34,809
------- ------- ------- -------
Gross profit 7,628 5,785 14,516 10,384
SG&A 4,984 4,058 9,906 7,670
------- ------- ------- -------
Operating income 2,644 1,727 4,610 2,714
Interest expense, other income &
expenses 104 151 219 297
------- ------- ------- -------
Income before income taxes 2,540 1,576 4,391 2,417
Income taxes 966 599 1,669 919
------- ------- ------- -------
Net income $ 1,574 $ 977 $ 2,722 $ 1,498
======= ======= ======= =======
Weighted average shares outstanding 5,515 5,290 5,482 5,248
Weighted average diluted shares
outstanding 6,389 5,860 6,250 5,793
Per Share Data
Net income per share outstanding $ 0.29 $ 0.18 $ 0.50 $ 0.29
Net income per diluted share
outstanding $ 0.25 $ 0.17 $ 0.44 $ 0.26
*T

Consolidated Condensed Balance Sheets

($ in thousands)

-0-
*T
30-Jun-08 31-Dec-
07
----------- -------
Assets: (unaudited)
Current assets $29,842 $28,575
Net property, plant, and equipment 11,701 9,492
Other assets 7,795 7,486
----------- -------
Total assets $49,338 $45,553
=========== =======
Liabilities and stockholders' equity:
Current liabilities $14,171 $13,623
Long-term debt 5,541 6,271
Other liabilities 1,447 1,416
----------- -------
Total liabilities $21,159 $21,310
Total stockholders' equity 28,179 24,243
----------- -------
Total liabilities and stockholders' equity $49,338 $45,553
=========== =======
*T

UFP Technologies, Inc.
Ron Lataille, 978-352-2200
www.ufpt.com

Copyright Business Wire 2008