Pollard Banknote Announces Purchase of New 22-Station Press—the Most Advanced Instant Ticket Printing Press in the Industry

WINNIPEG, MB, April 2, 2014 /CNW/ - Pollard Banknote Limited (TSX: PBL) (Pollard Banknote) is pleased to announce that it has signed an agreement for the purchase of a new 22-station Tresu press—the most advanced instant ticket printing press in the lottery industry. The press is scheduled to begin live production in the second quarter of 2015 and will provide a substantial 35% net increase to Pollard Banknote's available print capacity. This state-of-the-art press—with a $20 million price tag—includes a number of unique features that will ensure it provides the most efficient and flexible inline instant ticket printing available.

"Pollard Banknote is very excited to announce this major expansion, as it comes as a result of the tremendous support the lottery industry has shown us," said Doug Pollard, Co-Chief Executive Officer, Pollard Banknote. "Our sales volumes continue to increase significantly, with our 2013 sales volumes up 8% over 2012, and we continue to have high expectations for 2014 and beyond. We are proud of the recent expansion of our client base and, more importantly, the support we've been able to provide our lottery customers in order to grow their proceeds for good causes. This investment in a new press is significant evidence of our belief in the growth potential of the lottery retail space, particularly when supported by an omni-channel marketing strategy."

The new press will be housed in Pollard Banknote's 90,000-square-foot production facility located in Ypsilanti, Michigan, allowing the company to continue providing unprecedented service to its customers in the United States. In conjunction with the commissioning of the new Tresu press in Ypsilanti, Pollard Banknote will be moving its existing production presses from Ypsilanti to its manufacturing facility in Winnipeg, Manitoba, thereby utilizing the company's proven manufacturing capabilities to support its expanding Canadian and international lottery customers. This capacity expansion will allow Pollard Banknote to transition to a more efficient, lower cost production platform overall.

Financing for this expansion will come from a number of sources, including the company's ongoing operating cash flow, an increase in its secured credit facility of approximately $5 million, and a subordinated loan of approximately $7 million from the Pollard family's holding company, Pollard Equities Limited.

"These are very exciting times in the lottery industry," summed up Doug Pollard. "We continue to see great opportunities for our partners and this announcement highlights our ongoing commitment to our customers and the sector."

About Pollard Banknote

Pollard Banknote is one of the world's leading full-service lottery vendors and is a major supplier to North America's charitable gaming industry. The company manufactures instant lottery tickets and provides related programming, design and marketing support. As well, Pollard Banknote manufactures pull-tab tickets and bingo paper, and supplies lottery management services (including warehousing and distribution). Established in 1907, Pollard Banknote is owned approximately 73.5% by the Pollard family and 26.5% by public shareholders and currently serves more than 50 lotteries worldwide, including some of the largest and most respected lotteries in the United States, Canada, Europe, Asia, and Central and South America. For more information, please visit our website at www.pollardbanknote.com.

Forward-looking Statements

Certain statements in this press release may constitute "forward-looking" statements and information, which involve known and unknown risks, uncertainties, and other factors that may cause actual results, performance, or achievements to be materially different from any future results, performance, or achievements expressed or implied by such forward-looking statements. When used in this document, such statements include such words as "may," "will," "expect," "believe," "plan," and other similar terminology. These statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this document. There should not be an expectation that such information will in all circumstances be updated, supplemented, or revised whether as a result of new information, changing circumstances, future events, or otherwise.

SOURCE: Pollard Banknote Limited

Doug Pollard     
Co-Chief Executive Officer
Telephone: [phone]
E-mail: [email protected] 

John Pollard
Co-Chief Executive Officer
Telephone: [phone]
E-mail: [email protected] 

Rob Rose
Chief Financial Officer
Telephone: [phone]
E-mail: [email protected]