Lazare Kaplan International Inc. Reports Fourth Quarter and Fiscal 2007 Year-End Results


NEW YORK, Aug. 29, 2007 (PRIME NEWSWIRE) -- Lazare Kaplan International Inc. (AMEX:LKI) today announced financial results for the fourth fiscal quarter and year ended May 31, 2007.

For the fourth quarter and fiscal year ended May 31, 2007, net sales were $96.9 million and $434.4 million, respectively as compared to $135.0 million and $528.0 million for the comparable prior year periods. Gross margin for the fourth quarter and fiscal year ended May 31, 2007 was 5.6% and 5.3% respectively, compared to 4.4% and 5.7% in the comparable prior year periods.

The decrease in sales for the fourth quarter and fiscal year 2007 primarily reflects the transfer during the second fiscal quarter 2007 of certain rough trading operations to a separately operated joint venture which the Company accounts for on the equity method.

Net income / (loss) for the fourth quarter and fiscal year ended May 31, 2007 was $0.2 million, or $0.02 per share, and $(3.0) million, or $(0.36) per share, compared to $0.5 million, or $0.06 per share, and $1.5 million, or $0.18 per share, in the respective prior year periods. Fully diluted earnings per share for the fourth quarter and fiscal year ended May 31, 2007 are based on the weighted average number of shares outstanding of 8,315,210 and 8,207,006, as compared to 8,317,251 and 8,569,661 in the comparable prior year periods.

Lazare Kaplan International Inc. sells its diamond and jewelry products through a worldwide distribution network. The Company is noted for its ideal cut diamonds which it markets internationally under the brand name, Lazare Diamonds(r).

Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties which may cause the Company's actual results in future periods to differ materially from forecasted results. Those risks include a softening of retailer or consumer acceptance of or demand for the Company's products, pricing pressures, adequate supply of rough diamonds and other competitive factors. These and other risks are more fully described in the Company's filings with the Securities and Exchange Commission. The information contained in this press release is accurate only as of the date issued. Investors should not assume that the statements made in these documents remain operative at a later time. Lazare Kaplan International Inc. undertakes no obligation to update any information contained in this news release.



 FINANCIAL HIGHLIGHTS
 ---------------------------------------------------------------------
 (In thousands, except share and per share data)

                           Three Months Ended     Twelve Months Ended
 May 31,                    2007        2006        2007        2006
 ---------------------   ---------   ---------   ---------   ---------
 Net sales               $  96,854   $ 135,002   $ 434,406   $ 528,045
 Cost of Sales              91,422     129,099     411,523     498,197
                         ---------   ---------   ---------   ---------
                             5,432       5,903      22,883      29,848
                         ---------   ---------   ---------   ---------
 Selling, general and
  administrative expenses    6,844       4,563      25,691      24,759
 Equity in (income)/loss
  of joint ventures         (2,352)        537      (3,913)        537
 Interest expense, net of
  interest income              832       1,472       5,856       3,786
                         ---------   ---------   ---------   ---------
                             5,324       6,572      27,634      29,082
                         ---------   ---------   ---------   ---------
 Income/(loss) before
  income taxes                 108        (669)     (4,751)        766
 Income tax provision/
  (benefit)                    (46)     (1,186)     (1,775)       (762)
                         ---------   ---------   ---------   ---------
 NET INCOME/(LOSS)       $     154   $     517   $  (2,976)  $   1,528
                         =========   =========   =========   =========

 EARNINGS/(LOSS) PER SHARE
                         
 Basic earnings/(loss)
  per share              $    0.02   $    0.06   $   (0.36)  $    0.18
                         ---------   ---------   ---------   ---------
 Average number of shares
  outstanding during the
  period                 8,228,467   8,198,578   8,207,006   8,291,413
                         ---------   ---------   ---------   ---------

 Diluted earnings/(loss)
  per share              $    0.02   $    0.06   $   (0.36)  $    0.18
                         ---------   ---------   ---------   ---------
 Average number of shares
  outstanding during the
  period assuming
  dilution               8,315,210   8,317,251   8,207,006   8,569,661
                         =========   =========   =========   =========


            

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