PSS World Medical Reports Results for Fiscal Year 2009 First Quarter

Business Wire, July 23, 2008

JACKSONVILLE, Fla. -- PSS World Medical, Inc. (NASDAQ GS:PSSI):

First Quarter Highlights:

* Consolidated net sales growth of 7.6%

* Physician Business net sales growth of 8.2%

* Elder Care Business net sales growth of 5.8%

* Consolidated income from operations growth of 24.5% to $18.1 million

* Consolidated operating margin growth of 52 basis points to 3.8%

* Physician Business operating margin growth of 66 basis points to 6.7%

* Elder Care Business operating margin growth of 43 basis points to 3.9%

* Consolidated earnings per diluted share growth of 30.8% to $0.17

* Consolidated cash flow from operations of $13.7 million

PSS World Medical, Inc. (NASDAQ GS:PSSI) announced today its results for the fiscal 2009 first quarter ended June 27, 2008.

David A. Smith, Chairman and Chief Executive Officer, commented, "We are ahead of schedule in both strategic investments and identifying opportunities for profitable growth. We are very concerned about the well-being of our customers and employees. Our customer programs are gaining traction and offer timely solutions for the current economic conditions. For our employees, we have initiated several creative programs designed to help offset their economic challenges and improve company-wide performance. We are focused on successful execution of our plans and continued value creation for our shareholders."

Net sales for the three months ended June 27, 2008, were $472.2 million, an increase of 7.6%, compared with net sales of $438.9 million for the three months ended June 29, 2007. Net sales for the three months ended June 27, 2008, for the Physician Business increased by 8.2%, while net sales for the Elder Care Business increased by 5.8%. Income from operations for the three months ended June 27, 2008, was $18.1 million compared with income from operations for the three months ended June 29, 2007, of $14.5 million. Net income for the three months ended June 27, 2008, was $10.3 million, or $0.17 per diluted share, compared with net income for the three months ended June 29, 2007, of $8.7 million, or $0.13 per diluted share.

David M. Bronson, Executive Vice President and Chief Financial Officer, commented, "Both our businesses grew profitably in the first quarter, improving consolidated operating margin by 52 basis points. The Company also generated $13.7 million of cash flow from operations during the quarter, further strengthening our balance sheet.

"Current economic conditions are presenting challenges for our customers, employees and manufacturing partners, but are also surfacing some exciting opportunities for innovation, share gains and strategic acquisitions."

A listen-only simulcast as well as a 90-day online replay of PSS World Medical's fiscal year 2009 first quarter conference call can be found in the Investor Relations/Financial Information sections of the Company's websites, www.pssworldmedical.com or www.pssd.com, respectively, under the heading "Events and Presentations," or at www.opencompany.info, on July 24, 2008, beginning at 8:30 a.m. Eastern time.

The Company has today filed with the SEC a Form 8-K that includes a copy of this press release and its related Fiscal Year 2009 First Quarter Financial Workbook, which contains GAAP and non-GAAP financial measures, and is available on the Company's website, www.pssworldmedical.com. Additional financial information pertaining to PSS World Medical financial results may be found by visiting the Investor Relations/Financial Information sections of the Company's websites, www.pssworldmedical.com or www.pssd.com, respectively, under the heading "Events and Presentations." If you should need assistance accessing the information, please call Investor Relations at 904-332-3000.

PSS World Medical, Inc. is a national distributor of medical products to physicians and elder care providers through its two business units. Since its inception in 1983, PSS has become a leader in the two market segments that it serves with a focused market approach to customer services, a consultative sales force, strategic acquisitions, strong arrangements with product manufacturers and a unique culture of performance.

Certain statements in this release are "forward-looking statements" made pursuant to the Private Securities Litigation Reform Act of 1995 and other federal securities laws. These forward-looking statements are identified by the use of words such as "expect," "may," "will," "should," "believe," "plan," "anticipate," and "estimate" among others. These statements involve a number of risks and uncertainties, many of which are outside the control of the Company. Actual results may differ materially from those identified in the forward-looking statements. Among the factors that could cause results to differ materially are the following: fluctuating demand for our products and services; the introduction of new products and services offered by us and our competitors; proper functioning of our data processing systems; our ability to carry out our global sourcing strategy; pricing pressures on large national and regional accounts and GPOs; customer credit quality and our ability to collect our accounts receivable; our ability to compete with other medical supply companies and direct manufacturers; multi-tiered cost structures where certain institutions can obtain more favorable prices for medical products than us; our ability to maintain relationships with our suppliers and customers; our ability to retain sales reps and key management; our ability to execute our growth strategy; increased operating costs, including fuel prices; risks involved in maintaining a large amount of inventory; we may not successfully execute our acquisition strategy; our indebtedness may limit our ability to obtain additional financing or react to market conditions; we face litigation and product liability exposure; we may be deemed to infringe other persons intellectual property; our business is subject to numerous federal, state and foreign laws and regulations, including state pedigree laws and regulations; general business competitive and economic factors and conditions; and other factors described from time to time in the Company's reports filed with the Securities and Exchange Commission. PSS assumes no obligation to update the information in this release except as otherwise required by law. Readers are cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof.