American Greetings Reports First Quarter Results,

Confirms Earnings Guidance for Fiscal Year 2000 Cleveland (ots-PRNewswire) - American Greetings (NYSE: AM)today reported financial results from the first quarter of fiscal2000, which reflect the successful progress of the Company'sretail productivity initiative. For the quarter ended May 31, 1999, American Greetingsreported sales of $458.8 million compared with $487.9 million forthe same period a year earlier. The decline, in line with theCompany's expectations, is the result of its efforts to lowerinventory levels in retail stores. Net income for the quarter was$10.8 million, or 16 cents per share assuming dilution. Thatcompares with $33.8 million, or 47 cents per share assumingdilution for the same period last year. In February, American Greetings announced plans to reduceinventory levels in its retail partners' greeting carddepartments by $100 million during fiscal 2000. Many retailersthat carry cards from American Greetings already are reportinghigher consumer sales and should see an improved return oninvestment as a result of this initiative. Also, the lowerinventory levels eventually should allow American Greetings tomore frequently replenish its card departments, ensuringretailers and consumers always have the most current and relevantgreeting cards in the marketplace. "Intuitions," a contemporary greeting card line that beganshipping to retailers this year, has already become one of theindustry's best-selling card lines and one of American Greetingstop-selling alternative card lines. "Intuitions" is beingsupported throughout the year by a national consumer advertisingcampaign. "Our retail partners are enthusiastic about our new productsand have embraced our efforts to enhance the productivity of thegreeting card departments in their stores," said Morry Weiss,chairman and chief executive officer of American Greetings."While our efforts will result in lower sales and earningsthrough this year, we expect to return to more historic saleslevels next fiscal year." Weiss said American Greetings continues to expect earnings forthe full year between $2.00 and $2.10 per share. Theseprojections do not include the Company's previously announcedinternational restructuring efforts or any changes that resultfrom the proposed separation and stock offering ofamericangreetings.com. American Greetings now expects itsinternational restructuring to occur in two parts. Details of thefirst charge are being finalized and an announcement is expectedsoon. The second charge will likely be made in the fourthquarter. Ed Fruchtenbaum, president and chief operating officer ofAmerican Greetings, said the Company's international operationsare off to a strong start in fiscal 2000. Subsidiaries in Canadaand the United Kingdom reported sales and earnings in the firstquarter ahead of last year's levels. "We are pleased with the recent results of our internationaloperations, but realize their performance can be even furtherenhanced by better deploying our resources," Fruchtenbaum said."As we finalize our plans, we will look to improve the service toour customers while enhancing shareholder value." Fruchtenbaum said the Company's emerging businesses alsocontinued to gain ground in the first quarter. GuildHouse candlesbegan shipping to more than 4,000 Rite Aid stores and DesignWarebegan shipping its Pokemon(TM) party goods line, which currentlyis one of the hottest children's licenses in America. "The strong double-digit revenue growth we have seen out ofthese businesses for the last two years is continuing,"Fruchtenbaum said. "However, we believe acquisitions will benecessary to achieve our goals in these businesses. In recentmonths, we have been looking closely at a number of opportunitiesthat will help GuildHouse and DesignWare achieve the market sharegoals we have set." American Greetings is the world's largest publicly heldcreator, manufacturer and distributor of greeting cards andsocial expression products. With headquarters in Cleveland, Ohio,American Greetings employs more than 21,000 associates around theworld and has one of the largest creative studios in the world.For more information on the Company, visit our site on the WorldWide Web at www.americangreetings.com . The statements contained in this release that are nothistorical facts are forward-looking statements. Actual resultsmay differ materially from those projected in the forward-lookingstatements. These forward-looking statements involve risks anduncertainties, including but not limited to, the following risks:retail bankruptcies and consolidations, a weak retailenvironment, competitive terms of sale offered to customers toexpand or maintain business or unforeseen difficulties in makingit impractical or inadvisable to form a separate subsidiary.Please see the Company's Form 10K for the year ended February 28,1999, for other risks and uncertainties that may affect futureresults.

AMERICAN GREETINGS CORPORATION

FIRST QUARTER REPORT OF CONSOLIDATED SALES AND INCOME

FISCAL YEAR ENDING FEBRUARY 29, 2000

(In thousands of dollars except per share amounts)

(Unaudited)

Three Months Ended

Percent

May 31,

Change

1999

1998 Net sales

$458,757 $487,908

(6.0%) Income before income taxes

16,948

53,277

(68.2%) Income taxes

6,101

19,446

(68.6%) Net income

10,847

33,831

(67.9%) Earnings per share

0.16

0.47

(66.0%) Earnings per share -

assuming dilution

0.16

0.47

(66.0%) Average number of common

shares outstanding

67,678,717

71,310,434

--

AMERICAN GREETINGS CORPORATION

CONSOLIDATED STATEMENT OF INCOME

(In thousands of dollars except per share amounts)

(Unaudited)

Three Months Ended

May 31,

1999

1998 Net sales

$458,757

$487,908 Costs and expenses:

Material, labor and other

production costs

159,765

159,719

Selling, distribution

and marketing

219,322

214,884

Administrative and general

54,603

58,164

Interest

7,140

6,573

Other expense (income)

979

(4,709)

Total

441,809

434,631 Income before income taxes

16,948

53,277 Income taxes

6,101

19,446 Net income

$ 10,847

$ 33,831 Earnings per share

$0.16

$0.47 Earnings per share -

assuming dilution

$0.16

$0.47 Average number of common

shares outstanding

67,678,717 71,310,434 otsOriginal Text Service: American Greetings Internet:http://www.newsaktuell.de Contact: Dale A. Cable, VicePresident, Treasurer, (USA) 216-252-7300, or Jim King, Manager,Investor & Media Relations, (USA) 216-252-4864, both of AmericanGreetings Company News On-Call:http://www.prnewswire.com/comp/044150.html or fax, (USA) 800-758-5804, ext. 044150 Web site: http://www.americangreetings.com

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