0025 billion as compared with
$907.
Operating loss for the quarter was $10.0 million.
Working in collaboration with educators , School Specialty reaches beyond
the scope of textbooks to help teachers, guidance counselors and school
administrators ensure that every student reaches his or her full potential.

Safe Harbor Statement
Statements in this release that are not strictly historical are "forward-
looking ," including statements regarding future outlook and financial
performance.32) $1.
Consolidated Statements of Cash Flows
(In thousands )
Unaudited

Fiscal Year Ended
April 30, April 24,
2005 2004

Cash flows from operating activities:
Net income $43,001 $40,797
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation and amortization
expense 18,119 17,905
Amortization of development
costs 4,418 1,717
Amortization of debt fees and
other 1,405 2,677
Deferred taxes 11,639 8,647
Loss on redemption of
convertible debt 1,839 -
Loss (gain) on disposal of
property and equipment 152 (15)
Restructuring and non-recurring
costs, net of payments 1,582 (216)
Net (repayments) borrowings
under accounts receivable
securitization facility (2,800) 4,000
Change in current assets and
liabilities (net of assets
acquired and liabilities
assumed in business combinations ):
Accounts receivable (2,682) 4,601
Inventories (890) (5,068)
Deferred catalog costs (2,254) 1,867
Prepaid expenses and other
current assets (8,314) (2,828)
Accounts payable (3,358) (5,562)
Accrued liabilities (9,826) 434
Net cash provided by
operating activities 52,031 68,956

Cash flows from investing activities:
Cash paid in acquisitions, net of
cash acquired (19,219) (89,273 )
Additions to property and equipment (23,376) (8,974)
Investment in intangible and other
assets (1,710) -
Investment in development costs (5,835) (4,726)
Proceeds from business disposition 193 4,026
Proceeds from disposal of property
and equipment 128 1,135
Net cash used in investing
activities (49,819) (97,812)

Cash flows from financing activities:
Proceeds from bank borrowings 540 ,900 349,900
Repayment of debt and capital
leases (510,360) (461,730)
Proceeds from convertible debt
offering - 133,000
Redemption of convertible debt (34,843) -
Premium paid on redemption of
convertible debt (1,195) -
Payment of debt fees and other (265) (4,045)
Proceeds from exercise of stock
options 5,375 11,711
Net cash (used in) provided
by financing activities (388) 28,836

Net increase (decrease ) in cash and
cash equivalents 1,824 (20)
Cash and cash equivalents, beginning
of period 2,369 2,389
Cash and cash equivalents, end of
period $4,193 $2,369

Free cash flow reconciliation:
Net cash provided by
operating activities $52,031 $68,956
Additions to property and
equipment (23,376) (8,974)
Investment in development
costs (5,835) (4,726)
Proceeds from disposal of
property and equipment 128 1,135
Net repayments (borrowings)
under accounts receivable
securitization facility 2,800 (4,000)
Free cash flow $25,748 $52,391

School Specialty, Inc.3% 49.3%
Total
Revenues $1,002,507 $907,503 $95,004 10. The MSRP for LeapPad
titles is $14.
For more information on the Titles for Teachers program , parents and
teachers are encouraged to visit LeapFrog's web site (http://www.

folder graw

9 percent for the fourth
quarter. Our Traditional segment grew 3. Diluted earnings per share prior to the noted charges
was $2.

Fourth Quarter Financial Performance
Net loss for the fourth quarter of fiscal 2005 was $8. SG+A as a percent
of revenues, excluding the restructuring and non-recurring charges , was 46. "The most significant unusual item is
capital expenditures at $23.
Average capital expenditures per year for us is $10.
Consolidated Condensed Balance Sheets
(In thousands)
Unaudited

April 30, April 24,
2005 2004

Assets
Cash and cash equivalents $4,193 $2,369
Accounts receivable 60,374 52,995
Inventories 137,578 139,786
Prepaid expenses and other current
assets 39,472 28,069
Deferred taxes 7,853 5,757
Total current assets 249,470 228,976
Property and equipment, net 73,264 65,294
Goodwill and other intangible assets,
net 542,099 517,696
Other 19,772 20,641
Total assets $884,605 $832,607

Liabilities and Shareholders' Equity
Current maturities - long-term debt $45,991 $524
Accounts payable 56,792 58,225
Other current liabilities 32,174 38,226
Total current liabilities 134 ,957 96,975
Long-term debt 149,680 314,104
Deferred taxes and other 55,423 42,553
Total liabilities 340,060 453,632
Shareholders' equity 544,545 378,975
Total liabilities +
shareholders' equity $884,605 $832,607

School Specialty, Inc.

, Teachers, students
and schools are set to benefit from a sweeping new $15 million donation
program , Titles for Teachers, announced today by LeapFrog Enterprises, Inc.com/summerbooks) for teachers.
510-596-3497
leinbinder@leapfrog.

yearbooks graw

5 percent to $175.3 million of
restructuring and non -recurring charges related to the closure of our Tempe,
Arizona, facility and redundant warehouse costs associated with the start-up
of our new distribution facility in Lancaster, Pennsylvania. In April we signed an agreement to market and
distribute the AWARD Reading, Math and Professional Development programs
developed by Wendy Pye, an internationally renowned reading expert responsible
for the development of over 1,800 titles with over 190 million units sold
worldwide," he said.37) $(0 .37) $(0.0%
Intercompany
Eliminations (1,231) (819) (412) 50.0%
Intercompany
Eliminations (2,846) (2,507) (339) 13.
LeapPad books are sold at major retailers such as Walmart, Target and Toys
R Us and wherever LeapPad learning systems are sold.com) for
consumers and (http://www.

overlays folkmanis

0 million, a 5.0 million. Diluted earnings per share was $1.0 to $12.3% 38.3% -1.5% 22.3% 63.7% 41. Titles for Teachers Program Enriches Student Learning With One Million
Free LeapPad Books

EMERYVILLE , Calif. In phase two, set to kick off on March 30,
2005, teachers can sign up to receive a box of free LeapPad books to deliver
to their students before the summer break.leapfrog. with over 200 interactive books and over 450 skill
cards representing more than 6,000 pages of educational content.

yearbooks searched

0025 billion , a 10.2 million as
compared to $86.1 percent decrease over
the prior year of $1. Included in operating loss was $2.2 of School
Specialty's Annual Report on Form 10-K for fiscal year 2004 and other
documents filed with the Securities and Exchange Commission.3%
Total Revenues $175,170 $161,398 $13,772 8.5% 100.3% 63.2%
Total Gross
Profit $74,254 $68,581 $5,673 8.3%
Specialty 46.7% 59. The LeapFrog SchoolHouse-curriculum programs are currently in
classrooms across the U.

explorelearning newswise

Hits Billion Dollar Revenue Target

GREENVILLE, Wis.
"We closed the year with strong revenue results," said David Vander
Zanden, President and Chief Executive Officer of School Specialty, Inc."

Fiscal 2005's Financial Performance
Revenues for fiscal 2005 were a record $1.4
percent of revenues as compared to 42.0 million as compared to $5.1% 0.0% 100.

cinematic bidding

1 million
restructuring and non-recurring charges noted above and the $1.9 percent in
the fourth quarter. "The extra week in our fiscal April 2005
created an increase in prepaid expenses, like rent, and a decline in accrued
liabilities, like payroll and commission, which shifted cash expenditures into
fiscal 2005. "We now expect
fiscal 2006 diluted earnings per share in the range of $2.schoolspecialty.com .1% -2.7%
Corporate 100.0% 0. consumer products are
available in six languages at major retailers in more than 25 countries around
the world.

yearbooks manikins

7 percent from 41.88, a 3.6%
Specialty 534,250 450,914 83,336 18.6%
Total Gross
Profit $418,032 $374,679 $43 ,353 11.3%

At that time, Pre-K through 2nd grade teachers are invited to
register with LeapFrog for a free box of LeapPad books to inspire their
students to keep reading and learning during the summer break. In addition, the
company has created more than 35 stand-alone educational products for children
from birth to 16 years.S. LeapFrog
SchoolHouse(TM) products have won numerous awards from the education industry,
including the Golden Lamp Award and Distinguished Achievement Award from the
Association of Educational Publishers, the Award of Excellence from Technology
+ Learning magazine and the Teacher's Choice Award from Learning magazine.

symbol folkmanis

5 percent. Gross margin expanded 40 basis points
to 41."

Outlook
"We continue to see evidence of an improving K-12 funding environment and
are confirming our previous guidance for internal revenue growth of 4 to 7
percent for fiscal 2006 targeting revenues at $1.17
Diluted $(0.4% 45.0% 0.8% -1.6%
Specialty 266,180 221,199 44,981 20.

LeapFrog Supports Teachers With 15 Million Dollars Worth of Learning Products

During the first
phase of the program, beginning March 1, 2005, individuals purchasing any
LeapPad book can register to donate one LeapPad book to their child's school
or any designated school in the US.

folder nealian

The increase in gross margin was
driven by a continued increase in mix of high margin proprietary products,
partially offset by a competitive pricing environment for non-proprietary
products, particularly in the traditional segment during the second and third
quarters of fiscal 2005.1 million last fiscal year, up $6.8 percent last year .8 million.2 million, net of proceeds from dispositions.
For more information about School Specialty and each of our brands visit
http://www.8%
Corporate 106 - 106 100.5% 51.8% 49.
"Working closely with teachers and parents, we hear an overwhelming
concern about the potential for 'brain drain' during the summer months and the
critical link between summer learning and ongoing student achievement,"
explained Jerry Perez, President of LeapFrog. between March 1, 2005 and August 31, 2005, a free
LeapPad book will be sent to the school of their choice to arrive in the fall
of 2005.

Teachers Get Free Books for Students
For educators , LeapFrog's Titles for Teachers program kicks off on
March 30, 2005.

feelings meck

3 percent last year.3 million , a $6. "We also plan to sponsor the first of its kind Educators'
Symposium, offering nationally recognized motivational speakers and education
industry experts delivering professional development content to pre K-12
educators across the country via satellite," he added.
These important factors include those set forth in exhibit 99.5%
Specialty 100,041 90,053 9,988 11.6%
Specialty 46,943 42,935 4,008 9.2% 62.6%
Corporate 106 - 106 100.

correlate feelings

1 million or 7.5 million increase in compliance costs
related to the company 's initial implementation of Sarbanes-Oxley Section 404. Gross margin remained relatively consistent at 42.5% 53.5% -0. It's our way of
thanking teachers and helping to set students up for a great summer of
learning. The first
40,000 teachers who sign up to participate in the Titles for Teachers program
will receive enough LeapPad books to provide one for each student in their
class (up to 35 students); a letter for parents with tips and information on
the importance of summer reading; and coupon books worth $20 for a variety of
LeapFrog learning products. The extensive LeapPad library includes more than 60
books that teach children a range of fundamental skills including reading,
math, science, social skills and more. Content for LeapPad titles is
based on extensive research and direction from the LeapFrog Educational
Advisory Board, made up of educational experts with extensive educational
research backgrounds.99. LeapFrog's award-winning U.

folder overlays

4 percent increase over last year . The increase in
revenues was due to acquired businesses and internal growth in the traditional
and specialty segments of 3.7 percent last year."
"Timing of cash flow related to the working capital accounts was affected
by our 52/53-week year," she added.04 to $1.9% 47.0%

% of Gross Profit
4Q05-YTD 4Q04-YTD Change $ Change % 4Q05-YTD 4Q04-YTD
Gross Profit
Traditional $154,592 $155,987 $(1,395) -0.0% 0. The teachers will receive their boxes in time to
distribute the books and educational materials before the end of the school
year.com

cinematic phonetic

, School Specialty
(Nasdaq: SCHS), the leading education company providing supplemental learning
products to the pre K-12 market, today reported fiscal 2005 revenues of
$1.6 percent for the year and 5.7 percent in fiscal 2005.2 percent or $1. Net income, excluding the $5.94.99 $2.88 $1.
Segment Analysis - Revenues and Gross Profit/Margin Analysis
4th Quarter, Fiscal 2005
(In thousands)
Unaudited

Segment Revenues and Gross Profit/Margin Analysis-QTD
% of Revenues
4Q05-QTD 4Q04-QTD Change $ Change % 4Q05-QTD 4Q04-QTD
Revenues
Traditional $80,489 $74,971 $5,518 7.1% 55.4% 38.0% 0.3% 35.4% 42."

Consumers Contribute Books for Schools
Parents, grandparents and the community can participate in the Titles for
Teachers program to support their local schools. Titles include popular kid's
characters such as SpongeBob Squarepants, Shrek 2, Spiderman and The
Incredibles and are focused on learning skills for a particular grade level ,
subject area, and standards-based curriculum. is a leading designer, developer and marketer
of innovative, technology-based learning products and related proprietary
content, dedicated to making learning effective and engaging for all ages, at
home and in schools, around the world.S.

apris folkmanis

We are off
to a good start to the fiscal 2006 season with a stronger state funding
environment for our customers.5 million last year, representing growth of 10.
Selling, general and administrative expenses ("SG+A") as a percent of
revenues, excluding restructuring and non-recurring charges, was 32. The increase in SG+A as a percent of
revenues was driven by an increase in sales by the specialty segment as a
percentage of our overall revenue mix, including a higher SG+A structure for
acquired businesses , as well as a $2. A traditional segment gross margin consistent with
last year and a specialty segment gross margin off 80 basis points due to the
liquidation of acquired, discontinued inventory were offset by the positive
effect of a continued increase in mix of high margin proprietary products
blending to consistent gross margin performance quarter over quarter.1
million last year. The increase in SG+A as a
percent of revenues was primarily driven by an increase in revenue mix
attributable to sales by the specialty segment, which generally has higher
marketing costs than the traditional segment, including a higher SG+A
structure for acquired businesses, as well as an increase in compliance costs
incurred during the fourth quarter related to the company's initial
implementation of Sarbanes -Oxley Section 404.

Cash Flow
"Free cash flow for fiscal 2005 at $25.60, a 14 to
26 percent increase over our fiscal 2005 results before restructuring and bond
redemption charges.3 % 100. Designed to bring a
multisensory approach to learning, the LeapPad personal learning tool enables
students to learn by seeing, touching and hearing -- appealing to the way
children naturally learn.

folkmanis phonetic

1 percent.4 percent over
last year's $40.1 million. Revenues
for the seasonally light quarter rose 8.07 billion," said
Vander Zanden. Our actual results could differ materially from those anticipated
in these forward-looking statements depending on various important factors.0%

% of Gross Profit
4Q05-QTD 4Q04-QTD Change $ Change % 4Q05-QTD 4Q04-QTD
Gross Profit
Traditional $28,436 $26,465 $1,971 7.6%
Total Gross
Margin 42.0%
Intercompany
Eliminations 15.
(NYSE: LF), a leading vendor of technology-based educational products .leapfrogschoolhouse.

cinematic phonics

6 percent.5 percent
as compared to 31.
Net income was a record $43.0 million , an increase of 5.2 percent increase over the prior year.
"In combination, we expect to invest $0.10 cents per diluted share in
these fine education programs in fiscal 2006 with the first revenue
recognition expected in fiscal 2007," said Vander Zanden.0% 100.0% 100.5%

Segment Revenues and Gross Profit/Margin Analysis-YTD
% of Revenues
Q05-YTD 4Q04-YTD Change $ Change % 4Q05-YTD 4Q04 -YTD
Revenues
Traditional $486,238 $468,667 $17,571 3.com

Shannon Eis
Kaplow Communications
212-221-1713
shannone@kaplowpr.

feelings apris

4 million as
compared to fiscal 2004's fourth quarter net loss of $6.0%
Intercompany
Eliminations (5,466) (3,626) (1,840) 50.0%

Segment Gross Margin Summary-QTD

Gross Margin 4Q05-QTD 4Q04-QTD
Traditional 35.0%
Intercompany
Eliminations 22.8% -1.0%
Corporate 106 - 106 100. The
company, known for its award-winning learning products including the
LeapPad(R) personal learning tool, works closely with educators to supplement
and enrich classroom curriculum content with interactive learning tools used
in more than 60,000 classrooms across the U. LeapFrog has developed a family of learning
platforms that come to life with more than 100 interactive software titles,
covering important subjects such as phonics, reading, writing, math, music,
geography, social studies, spelling, vocabulary and science .

multisensory apris

5 percent increase over last year and net income of
$43.2 million from
$161.7 million is under our historic
target of net income plus amortization," said Mary Kabacinski, Chief Financial
Officer of School Specialty, Inc.1% 57.8% 33.

Proven Learning Platforms and Extensive Library
The LeapPad personal learning tool is used in more than 60,000 classrooms
and by millions of children in their homes in the US.

About LeapFrog
LeapFrog Enterprises, Inc.

printables manikins

Operating income year-to-date is up 1.8
percent as compared with 45. These increases were partially
offset by reduced warehouse and transportation expense, resulting from our
supply chain optimization efforts.
Through each of our leading brands, we design, develop and provide pre K-
12 educators with the latest and very best resources in the areas of early
childhood, arts education, reading and literacy, personal effectiveness and
character education, coordinated school health, special learning needs, core
academics, and career development as well as classroom essentials and learning
environments.0% 0.0% 0.0% 0.

Two Ways to Enrich Learning
The Titles for Teachers program features two complementary initiatives to
make more books available to teachers and their students.

NOTE: LEAPFROG and LEAPPAD are trademarks or registered trademarks of
LeapFrog Enterprises, Inc.

apris bidding

Internal growth, which
represents fiscal 2005 revenues compared to fiscal 2004 revenues as adjusted
for the impact of acquisitions and divestitures prior to the date of the
transactions, was 3. The growth in revenues was
attributable to acquired businesses and to organic growth of 5.35 to $2.
Consolidated Statements of Operations
(In thousands, except per share amounts)
Unaudited

Three Months Ended Fiscal Year Ended
April 30, April 24, April 30, April 24,
2005 2004 2005 2004

Revenues $175,170 $161 ,398 $1,002,507 $907,503

Cost of revenues 100,916 92,817 584,475 532,824

Gross profit 74,254 68,581 418,032 374,679

Selling, general and
administrative expenses 81,908 73,717 325,802 288,560

Restructuring and non-recurring
costs 2,346 - 5,111 -

Operating income (loss) (10,000) (5,136) 87,119 86,119

Interest expense and other 3,071 4,872 14,956 19,407

Premium paid and fees for
convertible debt redemption - - 1,839 -

Income (loss) before
provision for (benefit
from ) income taxes (13,071) (10,008) 70,324 66,712

Provision for (benefit from)
income taxes (4,720) (3,888) 27,323 25,915

Net income (loss) $(8,351) $(6,120) $43,001 $40,797

Weighted average shares
outstanding:
Basic 22,816 19,012 21,612 18,828
Diluted 22,816 19,012 23,910 24,125

Per share amounts:
Basic $(0.9% 46.7% 20. The company was founded in 1995 and is
based in Emeryville, California.

Contact:
Liz Einbinder
LeapFrog Enterprises, Inc.

apris overlays

Excluding
restructuring charges of $5.
Partially offsetting these increases is a reduction in warehouse and
transportation costs as a percent of revenue.06, a 6.
"We are pleased to share our plans to invest in two exciting education
endeavors in fiscal 2006 ."

About School Specialty, Inc.
School Specialty is an education company that provides innovative and
proprietary products, programs and services to help educators engage and
inspire students of all ages and abilities.

School Specialty, Inc.94

Earnings before interest and
other, taxes, depreciation,
intangible amortization and
premium paid and fee expense
on convertible debt
redemption (EBITDA)
reconciliation:
Net income (loss) $(8,351) $(6,120) $43,001 $40,797
Provision for (benefit from)
income taxes (4,720) (3,888) 27,323 25,915
Interest expense and other 3,071 4,872 14,956 19,407
Depreciation and
amortization expense 4,647 4,973 18,119 17,905
Premium paid and fees for
convertible debt redemption - - 1,839 -
EBITDA $(5,353) $(163) $105,238 $104 ,024

School Specialty, Inc.5% 100.S. "LeapFrog strongly supports the
effort to encourage summer and year-round reading and that is why we are proud
to establish the Titles for Teachers initiative -- making it easy for teachers
to share the excitement of a new book with their students. Purchasers simply complete an online form and then send it in with
their receipt and a copy of the UPC label located on the back of the book to
LeapFrog by September 7, 2005 .

nealian multisensory

8 percent increase over the
prior year.4 million in the fourth quarter last year.1% 0.7% 48.0% 41.6% 100.3%
Specialty 49.1%
Corporate 100.S.

meck multisensory

1 million , operating income was $92.8 million
premium and fees related to the redemption of convertible debt in the second
quarter, was $47.5 million or 15.5 percent of revenues in the fourth
quarter of fiscal 2004. The
excess capital expenditures relate to the conveyor, racking and equipment
requirements of the new Lancaster distribution center and technology purchases
to support our Sarbanes-Oxley compliance effort.7%
Corporate 106 - 106 100.0% 0.9% 37.7% -0.0% 100.0%

Segment Gross Margin Summary-YTD

Gross Margin 4Q05-YTD 4Q04-YTD
Traditional 31. For each LeapPad book
purchased in the U.

feelings cursive

School Specialty Reports Fiscal 2005 Results

, "and
are proud to have exceeded one billion dollars in revenue, a goal that we set
several years ago when Dan Spalding was our CEO.32) $1.7% -3.6% -1.0%
Intercompany
Eliminations (18,087) (12,078) (6,009) 49.8%
Total Gross
Margin 41.