DUBLIN, Calif., July 23 /PRNewswire-FirstCall/ -- Simpson Manufacturing Co., Inc. (the "Company") announced today that its 2002 second quarter net sales increased 7.2% to $124,150,330 as compared to net sales of $115,842,506 for the second quarter of 2001. Net income increased 18.0% to $14,891,601 for the second quarter of 2002 as compared to net income of $12,618,652 for the second quarter of 2001. Diluted net income per common share was $1.20 for the second quarter of 2002 as compared to $1.03 for the second quarter of 2001. For the six months ended June 30, 2002, net sales increased 7.5% to $226,521,565 as compared to net sales of $210,666,459 for the six months ended June 30, 2001. Net income increased 14.0% to $24,621,541 for the first six months of 2002 as compared to net income of $21,598,806 for the first six months of 2001. Diluted net income per common share was $1.99 for the first six months of 2002 as compared to $1.76 for the first six months of 2001.

In the second quarter of 2002, sales growth occurred throughout the United States. The growth was strongest in the Northeastern and Midwestern regions. Sales in Europe also increased. Simpson Strong-Tie's second quarter sales increased 8.2% over the same quarter last year, while Simpson Dura-Vent's sales increased 0.8%. Homecenters, dealer distributors and lumber dealers were the fastest growing Simpson Strong-Tie connector sales channels. The sales increase was broad based across most of Simpson Strong-Tie's major product lines. Simpson Strong-Tie's high wind related products and its core products had the highest percentage growth rates in sales. Sales of Simpson Dura-Vent's Direct-Vent products increased compared to the second quarter of 2001 while sales of its pellet vent and chimney product lines decreased.

Income from operations increased 18.6% from $20,913,401 in the second quarter of 2001 to $24,795,028 in the second quarter of 2002 and gross margins increased from 39.2% in the second quarter of 2001 to 41.6% in the second quarter of 2002. The increase in gross margins was primarily due to lower manufacturing costs. In addition, the European operations as a whole made a positive contribution to the Company's operating income. Selling expenses increased 9.4% from $10,172,994 in the second quarter of 2001 to $11,133,905 in the second quarter of 2002, primarily due to higher personnel costs related to the increase in the number of merchandising personnel and to increased sales commissions as a result of higher sales. General and administrative expenses increased 9.3% from $14,374,917 in the second quarter of 2001 to $15,711,585 in the second quarter of 2002. This increase was primarily due to higher cash profit sharing, as a result of higher operating income, and other administrative overhead costs, partially offset by a reduction in goodwill amortization charges. The reduced amortization charge was affected by both the write-off of the Keybuilder.com software license in the second quarter of 2001 and the change in accounting related to the adoption of FASB No. 142 at the start of 2002. In addition, there was a reduction in the bad debt reserve related to a significant customer, as substantially all of the overdue receivables were recovered. The tax rate was 40.5% in the second quarter of 2002, a decrease from 42.4% in the second quarter of 2001.

In the first six months of 2002, sales growth occurred throughout the United States, particularly in the Northeastern and Midwestern regions and in California, but sales decreased slightly in the other western states. Sales in Europe also increased. Simpson Strong-Tie's first six months sales increased 8.6% over the same period last year, while Simpson Dura-Vent's first six months sales increased 1.3%. Lumber dealers were the fastest growing Simpson Strong-Tie connector sales channel. The growth rate of sales to home centers, which decreased slightly in the first quarter of 2002, was positive for the first half of 2002. The sales increase was broad based across most of Simpson Strong-Tie's major product lines. Simpson Strong-Tie's Strong-Wall and high wind related products had the highest percentage growth rates in sales. Sales of Simpson Dura-Vent's Direct-Vent products increased compared to the first six months of the prior year, while sales of its pellet vent and gas vent product lines decreased.

Income from operations increased 15.8% from $35,376,760 in the first six months of 2001 to $40,964,841 in the first six months of 2002 and gross margins increased from 39.2% in the first six months of 2001 to 40.1% in the first six months of 2002. The increase in gross margins was primarily due to lower manufacturing costs. In addition, the European operations as a whole made a positive contribution to the Company's operating income. Selling expenses increased 3.4% from $20,952,043 in the first six months of 2001 to $21,663,264 in the first six months of 2002, primarily due to higher personnel costs related to the increase in the number of merchandising personnel and to increased sales commissions as a result of higher sales, partially offset by decreased spending on advertising and promotion in the first quarter of 2002. General and administrative expenses increased 7.4% from $26,268,897 in the first six months of 2001 to $28,205,969 in the first six months of 2002. This increase was primarily due to higher cash profit sharing, as a result of higher operating income, and other administrative overhead costs, partially offset by a reduction in goodwill amortization charges. The reduced amortization charge was affected by both the write-off of the Keybuilder.com software license in the second quarter of 2001 and the change in accounting related to the adoption of FASB No. 142 at the start of 2002. In addition, there was a reduction in the bad debt reserve related to a significant customer, as substantially all of the overdue receivables were recovered. The tax rate was 40.6% in the first six months of 2002, a decrease from 42.2% in the first six months of 2001.

Investors, analysts and other interested parties are invited to join the Company's conference call on July 24, 2002, at 6:00 am, Pacific Time. To participate, callers may dial 800-451-7724. The call will be webcast simultaneously as well as being available for approximately one month through a link on the Company's website at http://www.simpsonmfg.com/.

This document contains forward-looking statements, based on numerous assumptions and subject to risks and uncertainties. Although the Company believes that the forward-looking statements are reasonable, it does not and cannot give any assurance that its beliefs and expectations will prove to be correct. Many factors could significantly affect the Company's operations and cause the Company's actual results to be substantially different from the Company's expectations. Those factors include, but are not limited to: (i) general economic and construction business conditions; (ii) customer acceptance of the Company's products; (iii) materials and manufacturing costs; (iv) the financial condition of customers, competitors and suppliers; (v) technological developments; (vi) increased competition; (vii) changes in capital market conditions; (viii) governmental and business conditions in countries where the Company's products are manufactured and sold; (ix) changes in trade regulations; (x) the effect of acquisition activity; (xi) changes in the Company's plans, strategies, objectives, expectations or intentions; and (xii) other risks and uncertainties indicated from time to time in the Company's filings with the Securities and Exchange Commission. Actual results might differ materially from results suggested by any forward-looking statements in this report. The Company does not have an obligation to publicly update any forward-looking statements, whether as a result of the receipt of new information, the occurrence of future events or otherwise.

The Company's results of operations for the three and six months ended June 30, 2002 and 2001, are as follows:

                             Three Months                 Six Months
                             Ended June 30,             Ended June 30,
                             (Unaudited)                  (Unaudited)
                           2002          2001         2002           2001

    Net sales        $124,150,330  $115,842,506  $226,521,565   $210,666,459
    Cost of sales      72,509,812    70,381,194   135,687,491    128,068,759
      Gross profit     51,640,518    45,461,312    90,834,074     82,597,700

    Selling expenses   11,133,905    10,172,994    21,663,264     20,952,043
    General and
     administrative
     expenses          15,711,585    14,374,917    28,205,969     26,268,897

      Income from
       operations      24,795,028    20,913,401    40,964,841     35,376,760

    Interest income,
     net                  216,405       294,236       474,731        754,513
      Income before
       taxes           25,011,433    21,207,637    41,439,572     36,131,273

    Provision for
     income taxes      10,119,832     9,000,507    16,818,031     15,241,393
    Minority interest          --     (411,522)            --      (708,926)
      Net income      $14,891,601   $12,618,652   $24,621,541    $21,598,806

    Net income
     per share:
      Basic                 $1.22         $1.04         $2.02          $1.79
      Diluted               $1.20         $1.03         $1.99          $1.76

    Weighted average
     shares
     outstanding:
      Basic            12,232,670    12,098,309    12,208,824     12,068,607
      Diluted          12,404,690    12,299,867    12,381,481     12,290,647

    Other data:
      Depreciation
       and
       amortization    $3,588,984    $4,634,371    $7,354,196     $8,695,868

The Company's financial position as of June 30, 2002 and 2001, and December 31, 2001, is as follows:

                                            June 30,             December 31,
                                     2002             2001           2001

    Cash and short-term
     investments                $85,599,578       $47,002,814    $95,871,950
    Trade accounts
     receivable, net             79,749,530        69,795,769     42,614,410
    Inventories                  92,922,483        88,655,208     82,476,299
    Other current assets          9,449,414         8,106,442      9,006,102
      Total current assets      267,721,005       213,560,233    229,968,761

    Property, plant and
     equipment, net              87,155,900        79,206,288     81,410,301
    Other noncurrent assets      19,285,433        20,764,289     18,232,988
      Total assets             $374,162,338      $313,530,810   $329,612,050

    Trade accounts payable      $19,832,660       $16,091,706    $15,738,659
    Notes payable and current
     portion of long-term
     debt                         2,955,105         1,874,288        986,448
    Other current liabilities    27,121,094        22,951,655     18,982,843
      Total current liabilities  49,908,859        40,917,649     35,707,950

    Long-term debt                5,442,806         4,596,592      5,686,995
    Other liabilities                    --           177,355        100,000
    Minority interest                    --            45,352             --
    Stockholders' equity        318,810,673       267,793,862    288,117,105
    Total liabilities and
     stockholders' equity      $374,162,338      $313,530,810   $329,612,050

Simpson Manufacturing Co., Inc., headquartered in Dublin, California, through its subsidiary, Simpson Strong-Tie Company Inc., designs, engineers and is a leading manufacturer of wood-to-wood, wood-to-concrete and wood-to-masonry connectors and shearwalls. Simpson Strong-Tie also offers a full line of adhesives, mechanical anchors and powder actuated tools for concrete, masonry and steel. The Company's other subsidiary, Simpson Dura-Vent Company, Inc., designs, engineers and manufactures venting systems for gas and wood burning appliances. The Company's common stock trades on the New York Stock Exchange under the symbol "SSD."

For further information, contact Barclay Simpson at 925-560-9032.