Paragon Technologies News Releases

Contributing to pre-tax earnings for the first half of 2002 was other income from the licensing of real property of $300,000, and a gain on the sale of excess fixed assets during the first quarter of $108,000, and the application of a recent accounting pronouncement, whereby goodwill is no longer amortized, thereby resulting in an increase to pre-tax earnings of $234,000. The backlog of orders was approximately $11.6 million at the end of the second quarter, versus $13.0 million at the end of the first quarter of 2002.

Bill Johnson, Paragon's Chief Executive Officer, commented, "The Company's quoting activity continues to be strong, and maintaining an aggressive selling focus on promising market segments is a prime objective. In fact, we have recently added resources aimed at expanding the customer base at both Paragon and SI/BAKER, our joint venture with McKesson Automation Systems. It is important to note that we continue to take prudent risks as we invest in research and development activities aimed at the introduction of enhanced products and capabilities to add to our base of material handling solutions. In addition, we continue to remain focused on productivity improvement and cost reduction strategies to achieve gains in operating profit. We are disappointed in the sluggish economy, but believe that Paragon is well positioned to achieve enhanced profitability when economic conditions recover."

The Company will host a conference call to discuss these results on Friday, August 9, 2002 at 11:00 a.m. EDT. To participate in the call, please dial 800-230-1096 and ask for the Paragon Technologies teleconference. Simultaneous with the conference call, an audio web cast of the call will be available via a link on the Paragon website, www.paragontechnologiesinc.com.

About Paragon Technologies

Paragon Technologies is a leader in integrating materials handling systems and creating automated solutions for material flow applications. Ermanco's branded conveyor technologies and material handling solutions address the needs of the distribution, assembly, and manufacturing marketplace. SI Systems' branded technologies and material handling solutions address unit assembly handling and order fulfillment applications. Paragon Technologies' Quality Management System at its Easton, Pennsylvania location is certified to the ISO 9001 standard. The scope of the Quality Management System governs the design, manufacture, assembly, installation, and servicing of automated materials handling and distribution systems. One of the top materials handling systems suppliers worldwide, Paragon's leading clients include the United States Postal Service, General Motors, IBM, BMG, Daimler Chrysler, Johnson & Johnson, Ford, Peterbilt, Harley-Davidson, Walgreens, and Clark Equipment.

Certain statements contained herein are not based on historical fact and are to be viewed as "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Words or phrases used in this News Release denoting the anticipated results of future events, such as " believe," "affords us," "grow," "will be," "will spur additional opportunities," and similar expressions that denote optimism and uncertainty, are intended to identify such forward-looking statements. SI Handling's actual results, performance, or achievements could differ materially from the results expressed in, or implied by, such "forward-looking statements" if the factors on which their conclusions are based do not conform to their expectations.