QUIP Quipp (MM)

Also Announces Receipt of Expressions of Interest in Connection with its Evaluation of Strategic Alternatives MIAMI, April 2 /PRNewswire-FirstCall/ -- Quipp, Inc. (NASDAQ:QUIP) announced today that it is filing a Notification of Late Filing on Form 12b-25 with the Securities and Exchange Commission relating to its Annual Report on Form 10-K for the year ended December 31, 2006. The filing extends the April 2, 2007 due date for the Form 10-K filing by up to 15 calendar days under SEC rules. Quipp's Form 12b-25 states that the filing of its Form 10-K has been delayed due to the time and effort involved in compiling and analyzing information in order to test for impairment of goodwill, and to determine the extent to which a valuation allowance should be applied to Quipp's deferred tax assets. The impairment will, and the valuation allowance may, result in a non-cash charge to earnings. Michael Kady, Quipp's President and Chief Executive Officer, commented that, "Due to recent declines in our market capitalization, the goodwill carried on our balance sheet is impaired as of December 31, 2006. The impairment charge is required under the accounting guidelines but does not reflect any change in our view of Quipp's business. While the effect of the impairment will be a charge to earnings, there is no adverse impact on our balance of cash and marketable securities or on our cash flow." Quipp's analysis regarding a valuation allowance relating to its deferred tax assets is continuing. Mr. Kady also addressed Quipp's ongoing evaluation of strategic alternatives, stating: "Last year, our Board of Directors formed a Special Committee to explore strategic alternatives for the company. Recently, the Committee has received expressions of interest to acquire Quipp. Of course, any transaction would be subject to the negotiation of a definitive agreement, and the consummation of the transaction would be subject to the terms and conditions set forth in such an agreement, if one is executed. While there is certainly no assurance that the company can reach a definitive agreement with respect to, or complete, a possible transaction, our Board has been considering the expressions of interest." In its Form 12b-25, Quipp reported that net sales for 2006 were $26,413,681, a 2.4% increase over net sales of $25,782,879 in 2005, and gross profit in 2006 was $6,824,605, an 8.8% increase over gross profit of $6,271,109 in 2005. Selling, general and administrative expenses will be substantially higher in 2006 than in 2005, principally due to the non-cash goodwill impairment charge of $2,590,847. Other selling, general and administrative expenses for 2006 were $6,618,012. Selling, general and administrative expenses in 2005 were $5,999,955. Mr. Kady added: In addition to improvement in sales and gross profit, we can report that bookings in the fourth quarter totaled $8.2 million compared to $4.3 million in the third quarter of 2006 and $8.7 million in the fourth quarter of 2005." Quipp also announced that its Board of Directors has declared a dividend of $0.05 per share payable on June 1, 2006 to shareholders of record on May 1, 2007. Quipp, Inc., through its subsidiary, Quipp Systems, Inc., designs, manufactures and installs material handling systems and equipment to facilitate the automated inserting, assembly, bundling and movement of newspapers from the printing press to the delivery truck. CAUTIONARY STATEMENT: This press release contains forward-looking statements that address, among other things, a transaction that possibly could result from the expressions of interest received by the Special Committee of the Board of Directors. Actual results could differ materially from those described in the forward-looking statements due to, among other things, the determination of a potential party to withdraw or not proceed with a possible transaction, the inability of the parties to agree to the terms of a definitive agreement, or the inability of a party to satisfy the terms and conditions of a definitive agreement. DATASOURCE: Quipp, Inc. CONTACT: Michael Kady, +1-800-345-9680, for Quipp, Inc. Web site: http://www.quipp.com/

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