united stationers 1999ar

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  • United Stationers is North Americas leading

    business products wholesale distr ibutor. We

    help our resellers win in the marketplace by

    picking individual end-consumer orders for

    personalized delivery, as well as shipping full

    cases and even pallets of merchandise. We also

    help our resellers win through our extensive

    i n v e n t o r y, b r o a d g e o g r a p h i c r e a c h a n d

    state-of- the-art technology, which al low us

    to achieve high f i l l rates and provide same-

    day / next-day service. This pick, pack, ship

    and track core competency also enables us

    to cap i ta l ize on emerg ing oppor tun i t i e s in

    the wor ld o f e - commerce .

    2200 East Golf RoadDes Plaines, Illinois 60016

    (847) 699-5000www.unitedstationers.com

  • e-NITED BusinessSolutions allowsInternet e-tailers tofocus on sales andmarketing, while leveraging UnitedStationers fulfillmentcapabilities with itssubstantial inventoryand distributioninfrastructure.

    United serves as a silent partnerfor its reseller customers providing a full range of value-added services while remaining transparent to the end consumer.

    This allows resellers to reduce their inventory investment

    and working capital requirementsand improve their profitability.

    United adds value for resellers by: Offering a broad

    product assortment,which promotes one-stop shopping.

    Using an efficient distribution system,which reduces costswhile maintaining high in-stock service levels.

    Offering multiple distribution solutions,including Uniteds dedicated fleet, common carriers, and drop shipmentsdirect to endconsumers on behalf of its resellers.

    Providing customized marketing programs,which include a variety of catalogs and promotional materials.

    Conducting consumer research and reseller training programs.

    Acquisitions haveexpanded Unitedsreach:

    United merged with AssociatedStationers in March 1995 to become the industry leader.

    United acquired Lagassein October 1996 toaggressively pursue thejanitorial and sanitation supply market.

    United acquired Azerty in April 1998 to expand its computerconsumables business.

    Uniteds integrated national distribution network draws on 39 full line regional distribution centers, 21 janitorial and sanitation supply centers, and six computer supply centersmore than nine million square feet of warehouse space.

    Uniteds proprietarysystem is integrated,linking its distributioncenters and enablingits reseller customersto optimize a $600million inventoryinvestment.

    95% of Uniteds orders from resellersare pre-soldmeaning a reselleralready has a consumer order in-hand before requiring fulfillmentfrom United.

    United has a 98%order fill rate, a 99.5% order accuracy rate, and a 99% on-time delivery rate.

    United is an indispensable partnerfor manufacturersmoving products toresellers and consumersthat manufacturerscould not efficientlyreach on their own.

    United can reach nearly every reseller or consumer in the U.S. on the same day or overnight.

    United carries theindustrys broadestproduct offering:35,000 items from 500 manufacturers,including traditionaloffice products, computer consumables,office furniture, business machines and audio-visualequipment, andjanitorial andsanitation supplies.

    Through its resellers, United distributes nearly 14 million catalogs, plus 16 million flyers annually.

    United Stationersserves more than20,000 reseller customers: officeproducts dealers,mega-dealers, contract stationers,office productssuperstores, computer productsresellers, office furniture dealers,mass merchandisers,mail order compa-nies, sanitary supply distributors,and e-commerce merchants.

    Uniteds DealerEconomic Model helps resellers evaluate whichproducts theyshould stock and which should be sourced from United.

    Directors OfficersStockholder Information

    Frederick B. Hegi, Jr. (e) (g) Founding Partner of Wingate Partners, Chairman, President and CEO, Kevco, Inc.,Chairman, Loomis, Fargo & Co. and Chairman of the Board of the Company

    Randall W. Larrimore (e) President, Chief Executive Officerand Interim Chief Financial Officer

    Daniel J. Good (g) Chairman, Good Capital Co., Inc. and Chairman, COM2001.com

    Ilene S. Gordon (a) (h) President, Pechiney Plastic Packaging

    Roy W. Haley (a) (h) Chairman and Chief Executive Officer, WESCO International, Inc.

    Max D. Hopper (a) Principal and Chief Executive Officer,Max D. Hopper Associates

    James A. Johnson (h) Principal, Wingate Partners

    Benson P. Shapiro (e) (g) Consultant, Speaker; Malcolm P. McNair Professor of Marketing at Harvard BusinessSchool until 1997

    (a) Audit Committee

    (e) Executive Committee

    (g) Governance Committee

    (h) Human Resources Committee

    Randall W. Larrimore President, Chief Executive Officer and Interim Chief Financial Officer

    Steven R. Schwarz Executive Vice President and President, United Supply Division

    Kathleen S. Dvorak Vice President, Investor Relations and Assistant Secretary

    Tom Helton Vice President, Human Resources

    Susan Maloney Meyer Vice President, General Counsel and Secretary

    James A. Pribel Treasurer

    Ergin Uskup Vice President, Management Information Systems and Chief Information Officer

    Offer of 10-K The Annual Report on Form 10-K filed with the Securities and Exchange Commission for 1999 is available without charge to anystockholder upon request to: Kathleen Dvorak Vice President, Investor Relations United Stationers Inc. 2200 East Golf Road Des Plaines, IL 60016-1267 Telephone (847) 699-5000, Ext. 2321 Fax (847) 699-4716

    Stock Market Listing Nasdaq National Market System Trading Symbol: USTR Included in the S&P SmallCap 600 Index

    Annual Meeting The regular annual meeting of stockholders is scheduled to be held at 2:00 p.m. on May 10, 2000 at: United Stationers Inc. 2200 East Golf Road Des Plaines, IL 60016-1267

    Transfer Agent and Registrar Communications regarding stock transferrequirements, lost stock certificates or change of address should be directed to: BankBoston, N.A. c /o EquiServe P.O. Box 8040 Boston, MA 02266-8040 Telephone (781) 575-3400 E-mail www.equiserve.com

    Printed on Recycled Paper

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  • United Stationers is North Americas leading

    business products wholesale distr ibutor. We

    help our resellers win in the marketplace by

    picking individual end-consumer orders for

    personalized delivery, as well as shipping full

    cases and even pallets of merchandise. We also

    help our resellers win through our extensive

    i n v e n t o r y, b r o a d g e o g r a p h i c r e a c h a n d

    state-of- the-art technology, which al low us

    to achieve high f i l l rates and provide same-

    day / next-day service. This pick, pack, ship

    and track core competency also enables us

    to cap i ta l ize on emerg ing oppor tun i t i e s in

    the wor ld o f e - commerce .

    2200 East Golf RoadDes Plaines, Illinois 60016

    (847) 699-5000www.unitedstationers.com

  • Financial Highlights

    Net SalesOperating Income

    Net Income per Share

    DOLLARS IN BILLIONS

    0

    0.5

    1.0

    1.5

    2.0

    2.5

    3.0

    3.5

    99989796951

    $2.3$2.2

    $3.1

    $3.4

    $2.6

    DOLLARS IN MILLIONS

    99982972951 96

    $113

    $169

    $182

    0

    25

    50

    75

    100

    125

    150

    175

    200

    $81

    $135

    DOLLARS PER SHARE

    9998297296951

    $2.37

    0

    0.50

    1.00

    1.50

    2.00

    2.50

    $1.47

    $1.01

    $0.40

    $2.00

    1

    1Pro forma 2Before charges (See Note 1 to the Consolidated Financial Statements.)

    UNITED STATIONERS INC. AND SUBSIDIARIES

    (dollars in thousands, except per share data)

    Income Statement Data for the Years Ended Dec. 31, 1999 Dec. 31, 1998*

    Net sales . . . . . . . . . . . . . . . . . . . . $ 3,393,045 $ 3,059,166Income from operations . . . . . . . . . . . . . . 182,194 155,511Income before income taxes and extraordinary item . . . . 143,567 110,989Net income. . . . . . . . . . . . . . . . . . . . 83,409 58,018Net income per common share assuming dilution . . . . 2.37 1.60Average number of common shares (in thousands) . . . . 35,208 36,171

    Operating Results Before Charges*

    Income from operations . . . . . . . . . . . . . . $ 182,194 $ 169,363Net income . . . . . . . . . . . . . . . . . . 83,409 72,212Net income per common share assuming dilution . . . . 2.37 2.00

    Balance Sheet Data at Year End

    Working capital . . . . . . . . . . . . . . . . . . $ 415,548 $ 357,024Total assets . . . . . . . . . . . . . . . . . . . . 1,279,903 1,166,991Long-term obligations (including current maturities) . . . . 355,552 336,200Stockholders equity . . . . . . . . . . . . . . . . 406,009 370,563

    *Second quarter results included in the year ended Dec. 31, 1998, reflect the write-off of the remaining term of a contract for computer services from a vendor. As a result, the company recorded a non-recurring charge of $13.9 million ($8.3 million net of tax benefit of $5.6 million) to write off the remaining payments and r