Avery Dennison announces record quarterly results; first quarter earnings per share up 17...

PASADENA, Calif.--(BUSINESS WIRE)--April 23, 1996--Avery Dennison Corporation (NYSE/PSE:AVY) today reported record earnings per share, net income and sales for the quarter ended March 30, 1996.

o Earnings per share increased 17 percent to $.76 per share from

$.65 per share for the

o Net income increased 16 percent to $40.0 million from $34.5

million in the same period last year.

o Excluding divested units, sales increased 5.6 percent to

$796.6 million. Reported sales increased 3.0 percent from

$773.2 million.

o Return on shareholders' equity increased to a record 19.6 percent

and return on total capital increased to 15.3 percent, the highest

returns in more than ten years.

Charles D. Miller, chairman and chief executive officer, said, "First quarter net income improved significantly due to stronger sales and continued cost control. Both U.S. and international operations reported solid increases in sales and income.

"Avery-brand products continue to receive excellent consumer acceptance. New and innovative Avery-brand laser and ink-jet printer products for home and office contributed to an outstanding first quarter. Solid demand for Fasson-brand pressure-sensitive film and paper materials, combined with industry-leading customer service, contributed to excellent sales growth. Significant investments in new process capabilities and new geographic markets continued during the quarter.

"Based on current economic indicators, we expect sales and profits for the second quarter to improve over prior year."

Avery Dennison, based in Pasadena, makes self-adhesive materials, tapes and labels, office products, tags, retail systems and specialty chemicals. Consumer brands include AVERY brand office labels and card products, indexes, binders and software, and FASSON brand self-adhesive materials for industrial markets. The Company has 15,500 employees in more than 200 manufacturing facilities and sales offices in 33 countries. -0-

                         Avery Dennison
                Consolidated Statement of Income
              (In millions, except per share amounts)
                          (Unaudited)

                                     Three Months Ended
                                 Mar 30, 1996   Apr 1, 1995

Net sales                          $   796.6     $   773.2
Cost of products sold                  549.9         528.4

  Gross profit                         246.7         244.8

Marketing, general &
 administrative expense                175.3         180.0

Interest expense                         8.9          10.0

  Income before taxes                   62.5          54.8

Taxes on income                         22.5          20.3

  Net income                        $   40.0      $   34.5

    Net income per share
     of common stock                $   0.76      $   0.65

Average shares outstanding              52.9          53.4

Shares outstanding at period end        52.8          53.3
-0-

                         Avery Dennison
               Condensed Consolidated Balance Sheet
                         (In millions)
                          (Unaudited)

Assets                                 Mar 30, 1996  Apr 1, 1995
Current assets:
  Cash and cash equivalents             $     5.3      $     3.4
  Trade accounts receivable, net            460.0          431.6
  Inventories, net                          229.0          236.1
  Other current assets                      102.6           88.5

    Total current assets                    796.9          759.6

Property, plant and equipment, net          909.8          863.7
Intangibles resulting from
 business acquisitions, net                 122.6          128.8
Other assets                                133.9          132.0
                                        $ 1,963.2      $ 1,884.1

Liabilities and Shareholders' Equity
Current liabilities:
  Short-term and current
   portion of long-term debt            $   124.2      $    84.8
  Accounts payable                          164.7          178.6
  Accrued liabilities                       334.9          323.4

    Total current liabilities               623.8          586.8

Long-term debt                              374.9          395.2
Other long-term liabilities                 146.1          139.8
Shareholders' equity:
  Common stock                               62.1           62.1
  Capital in excess of par value            190.7          192.2
  Retained earnings                         861.9          773.3
  Cumulative translation adjustment          34.9           42.4
  Cost of unallocated ESOP shares           (27.0)         (37.6)
  Minimum pension liability                  (2.6)          (5.0)
  Treasury stock at cost                   (301.6)        (265.1)

    Total shareholders' equity              818.4          762.3

                                        $ 1,963.2      $ 1,884.1
-0-

                          Avery Dennison
           Condensed Consolidated Statement of Cash Flow
                          (In millions)
                           (Unaudited)

                                             Three Months Ended

                                        Mar 30, 1996   Apr 1, 1995
Operating Activities:

Net income                               $   40.0       $   34.5

Adjustments to reconcile net
 income to net cash provided
 by operating activities:

  Depreciation                               24.9           26.1

  Amortization                                2.6            3.5

  Net gain on divestitures
   and restructuring charges                    -              -

  Deferred taxes                              6.4            0.9

  Changes in assets and liabilities,
   net of the effect of foreign currency
   translation and business divestitures    (74.6)         (49.3)

Net cash (used in) provided
 by operating activities                     (0.7)          15.7

Investing Activities:

Purchase of property, plant and equipment   (38.3)         (36.7)
Proceeds from sale of assets
 and business divestitures                    3.8            0.2

Other                                         2.4           (6.5)

Net cash used in investing activities       (32.1)         (43.0)

Financing Activities:

Net increase in long-term debt               40.9           47.3

Net increase in short-term debt               8.7            7.0

Dividends paid                              (15.9)         (14.4)

Purchase of treasury stock                  (25.1)         (14.5)

Other                                         2.5            2.0

Net cash provided by financing activities    11.1           27.4

Effect of foreign currency
   translation on cash balances               0.0            0.2

(Decrease) increase in cash
 and cash equivalents                       (21.7)           0.3

Cash and cash equivalents,
 beginning of period                         27.0            3.1

Cash and cash equivalents, end of period  $   5.3        $   3.4

CONTACT: Avery Dennison

Media Relations:

Diane B. Dixon, 818/304-2118

dixondiane@averydennison.com

or

Investor Relations:

Wayne H. Smith, 818/304-2001

investorcom@averydennison.com