Cautionary Statement Concerning Forward-Looking Statements

The Company desires to take advantage of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995 (the "1995 Act"). The 1995 Act provides a "safe harbor" for forward-looking statements to encourage companies to provide information without fear of litigation so long as those statements are identified as forward-looking and are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those projected.

This report includes and incorporates by reference forward-looking statements within the meaning of the 1995 Act. These statements are included throughout this report, and in the documents incorporated by reference in this report, and relate to, among other things, projections of revenues, earnings, earnings per share, cash flows, capital expenditures, working capital or other financial items, output, expectations regarding acquisitions, discussions of estimated future revenue enhancements, potential dispositions and cost savings. These statements also relate to the Company's business strategy, goals and expectations concerning the Company's market position, future operations, margins, profitability, liquidity and capital resources. The words "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will" and similar terms and phrases identify forward-looking statements in this report and in the documents incorporated by reference in this report.

Although the Company believes the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. The Company's operations involve risks and uncertainties, many of which are outside the Company's control, and any one of which, or a combination of which, could materially affect the Company's results of operations and whether the forward-looking statements ultimately prove to be correct.

Actual results and trends in the future may differ materially from those suggested or implied by the forward-looking statements depending on a variety of factors including, but not limited to:

• the prolonged continuation or further deterioration of current credit and capital market conditions;

• the effect of economic conditions on our customers and the capital markets we serve, particularly the difficulties in the financial services industry and the general economic downturn that began in the latter half of 2007 and which has further deteriorated during 2008;

• interest rate fluctuations and changes in capital market conditions or other events affecting our ability to obtain necessary financing on favorable terms to operate and fund our business or to refinance our existing debt;

• continuing availability of liquidity from operating performance and cash flows as well as the revolving credit facility;

• a weakening of our financial position or operating results could result in noncompliance with our debt covenants;

• competition based on pricing and other factors;

• fluctuations in the cost of paper, other raw materials and utilities;

• changes in air and ground delivery costs and postal rates and regulations;

• seasonal fluctuations in overall demand for the Company's services;

• changes in the printing market;

• the Company's ability to integrate the operations of acquisitions into its operations;

• the financial condition of the Company's clients;

• the Company's ability to continue to obtain improved operating efficiencies;

• the Company's ability to continue to develop services for its clients;

• changes in the rules and regulations to which the Company is subject;

• changes in the rules and regulations to which the Company's clients are subject;

• the effects of war or acts of terrorism affecting the overall business climate;

• loss or retirement of key executives or employees; and

• natural events and acts of God such as earthquakes, fires or floods.

Many of these factors are described in greater detail in the Company's filings with the Securities and Exchange Commission (the "SEC"), including those discussed elsewhere in this report or incorporated by reference in this report. All future written and oral forward-looking statements attributable to the Company or persons acting on behalf of the Company are expressly qualified in their entirety by the previous statements.

Overview

The Company's results for the three and nine months ended September 30, 2008 reflect the unfavorable economic conditions in 2008, including the significant decline in overall capital markets activity. Total revenue declined approximately $17.7 million, or 10%, and $46.2 million, or 7%, for the three and nine months ended September 30, 2008, respectively, as compared to the same periods in 2007. Capital markets services revenue, which historically has been the Company's most profitable service offering, decreased $37.2 million, or 47%, and $65.3 million, or 29%, for the three and nine months ended September 30, 2008, respectively, as compared to the same periods in 2007. Shareholder reporting services revenue, which includes revenue from compliance reporting, investment management services and translation services increased $6.5 million, or 10%, for the three months ended September 30, 2008, and decreased $5.4 million, or 2%, for the nine months ended September 30, 2008, respectively, as compared to the same periods in 2007. Marketing and business communications services revenue for the three and nine months ended September 30, 2008 increased by approximately $15.3 million, or 57%, and $30.5 million, or 32%, respectively, as compared to the same periods in 2007, primarily a result of the addition of revenue associated with the Company's recent acquisitions. The Company reported diluted loss per share from continuing operations of ($0.62) for the three months ended September 30, 2008, as compared to diluted earnings per share of $0.03 for the same period in 2007. For the nine months ended September 30, 2008, the diluted loss per share was ($0.49) as compared to diluted earnings per share of $0.87 for the same period in 2007.

Acquisition Activity

During the nine months ended September 30, 2008, the Company acquired the following businesses:

In February 2008, the Company acquired GCom2 Solutions, Inc. ("GCom") for $46.3 million in cash. The acquisition included working capital valued at approximately $3.8 million. This acquisition expands the Company's shareholder reporting services offerings in the United States, the United Kingdom, Ireland and Luxembourg.

In April 2008, the Company acquired the digital print business of Rapid Solutions Group ("RSG"), a subsidiary of Janus Capital Group Inc., for $14.5 million in cash, which included preliminary working capital estimated at $5.0 million. Pursuant to the asset purchase agreement, actual working capital greater than $5.0 million was for the benefit of the seller. During the third quarter of 2008, the Company paid an additional $3.0 million related to the settlement of the preliminary working capital in excess of the $5.0 million that was included as part of the purchase price. RSG is a provider of end-to-end solutions for marketing and business communications clients in the financial services and healthcare industries, which enables the Company to further expand its presence in those markets.

In July 2008, the Company acquired the U.S.-based assets and operating business of Capital Systems, Inc. ("Capital"), a leading provider of financial communications based in midtown New York City for approximately $14.6 million, which included working capital estimated at $0.9 million. Capital's former office in midtown New York City complements the Company's existing facility in the downtown New York City financial district. Capital enables Bowne to further extend its reach into key existing verticals: investment management, compliance reporting and capital markets services. Capital provides mutual fund quarterly and annual reporting and disclosure documents, such as SEC filings, including proxy statements and 10-Ks, as well as capital markets services for equity offerings, debt deals, securitizations, and mergers and acquisitions.

The Company has made significant progress in integrating these acquired businesses during the nine months ended September 30, 2008. The Company expects to complete the integration of these acquired businesses by the end of 2008.

Cost Reduction Initiatives

In light of the continued significant decline in overall capital markets activity experienced in 2008 and the uncertainty surrounding the current economic conditions, the Company implemented an initiative during the fourth quarter of 2008 to further reduce its workforce by an additional 330 positions. This initiative includes a broad range of functions and is enterprise-wide. The reduction is expected to result in annualized cost savings of approximately $21.0 million to $23.0 million, and will result in a fourth quarter pre-tax restructuring charge of approximately $4.0 million to $6.0 million. These actions are in addition to the cost savings initiatives implemented during the second quarter of 2008.

In total during 2008, including the aforementioned reduction in workforce discussed above, the Company implemented initiatives designed to achieve approximately $75.0 million to $80.0 million in annualized cost reductions. These initiatives are part of the Company's continued focus on improving its cost structure and realizing operating efficiencies, and in response to the downturn in overall capital markets activity. The cost reductions included the elimination of a total of approximately 1,000 positions, or approximately 24% of the Company's total headcount. These cost reductions consist of the following:

• a reduction in the Company's workforce by approximately 330 positions implemented during the fourth quarter of 2008, resulting in expected annualized cost savings of approximately $21.0 million to $23.0 million.

• a reduction in the Company's workforce by approximately 270 positions implemented during the second quarter of 2008, resulting in expected annualized cost savings of approximately $23.0 million.

• the continuation of the 2007 initiatives that are underway, resulting in $9.0 million of expected incremental annualized cost savings.

• the integration and transition of recently acquired businesses, including the closure of facilities and a reduction in headcount of approximately 400 positions, resulting in an estimated $23.0 million of annualized cost savings.

The initiatives implemented in the second quarter of 2008 are further detailed below:

During the second quarter of 2008, the Company reduced its headcount by approximately 270 positions, excluding the impact of headcount reductions associated with recent acquisitions. The reduction in workforce included a broad range of functions and was enterprise-wide. The Company also has closed its digital print facilities in Wilmington, MA and Sacramento, CA and its manufacturing and composition operations in Atlanta, GA. Work that was produced in these facilities has been transferred to the Company's other facilities or moved to outsourcing providers. The Company expects that these actions will result in annualized savings of approximately $23.0 million, including approximately $11.0 million to $13.0 million in 2008. The related restructuring charges resulting from these actions resulted in a pre-tax charge of approximately $15.1 million recognized primarily during the second and third quarters of 2008.

The cost savings measures implemented in 2006 and 2007 were designed to eliminate $35.0 million in costs over a three-year period. In the first two years of the three-year program, a total of $28.0 million in annual cost reductions was achieved. In 2008, Bowne expects to eliminate an additional $9.0 million in costs, which are estimated to result in annual savings of approximately $37.0 million over the three-year period, exceeding the original target. These actions are a continuation of initiatives put into place in 2007, including the full year benefit of the conversion to a cash balance pension plan, the reduction in our annual lease cost at our corporate headquarters related to the downsizing of space occupied, and the integration of certain manufacturing facilities completed in the second half of 2007.

The Company also completed the following actions related to the integration of recent acquisitions:

• the Company closed one of the two digital print facilities in Dallas, TX that were acquired as part of the acquisition of Alliance Data Mail Services in November 2007. Work that was produced in this facility has been migrated primarily to the Company's print facilities in West Caldwell, NJ, South Bend, IN, and Santa Fe Springs, CA.

• the Company closed the digital print facility located in Aston, PA, which was acquired as part of the acquisition of GCom in February 2008. Work that was produced in this facility has been migrated to the Company's print facility in Secaucus, NJ.

• the Company closed the digital print facilities located in Melville, NY and Mt. Prospect, IL which were acquired as part of the acquisition of RSG. Work that was produced in these facilities has been migrated primarily to the Company's print facilities in West Caldwell, NJ, South Bend, IN and Houston, TX.

The closure of these facilities has reduced the Company's headcount by approximately 400 positions and was completed primarily during the third and fourth quarters of 2008. The Company believes that these actions will result in combined annualized cost savings of approximately $23.0 million, including approximately $9.0 million in 2008. The shut down and integration of these operations are expected to result in estimated costs of approximately $21.0 million to $23.0 million, of which approximately $6.0 million has been accrued as part of the cost of these acquisitions and approximately $15.0 million to $17.0 million will be included in integration expense (approximately $11.4 million has been recorded as integration expense for these acquisitions through September 30, 2008) or capitalized as a component of the Company's property, plant and equipment.

In addition, the Company also expects to incur costs of approximately $1.5 million to $2.0 million related to the integration of Capital, which will primarily be recorded as integration expense (approximately $0.6 million has been recorded as integration expense for this acquisition through September 30, 2008).

Items Affecting Comparability

The following table summarizes the expenses incurred for restructuring,
integration and asset impairment charges during the three and nine months ended
September 30, 2008 and 2007:


                                                                                        Nine Months
                                                         Three Months Ended                Ended
                                                            September 30,              September 30,
                                                          2008          2007         2008         2007

Total restructuring, integration and asset
impairment charges                                     $    8,491      $ 2,106     $ 28,525     $ 12,154
After tax impact                                       $    5,344      $ 1,301     $ 17,827     $  7,480
Per share impact                                       $     0.19      $  0.05     $   0.65     $   0.23

The charges taken during the three and nine months ended September 30, 2008 primarily represent the following: (i) costs related to the Company's headcount reductions, as previously discussed; (ii) integration costs of approximately $7.1 million and $12.0 million, respectively, related to the Company's recent acquisitions; (iii) costs related to the closure of the Company's digital print facilities in Wilmington, MA and Sacramento, CA and its manufacturing and composition operations in Atlanta, GA; and (iv) costs associated with the consolidation of the Company's digital print facility in Milwaukee, WI with its existing facility in South Bend, IN. Further discussion of the restructuring, integration and asset impairment activities is included in the results of operations, which follows, as well as in Note 10 to the Condensed Consolidated Financial Statements.

Results of Operations

As discussed in more detail in Note 14 to the Condensed Consolidated Financial Statements, the Company has been realigned to operate as a unified company in 2008, and no longer operates itself as two separate business units. As such, the Company now has one reportable segment, which is consistent with how the Company is structured and managed. The results of operations for the three and nine months ended September 30, 2008 and 2007 reflect this current presentation.

Management uses segment profit to evaluate Company performance. Segment profit is defined as gross margin (revenue less cost of revenue) less selling and administrative expenses. Segment performance is evaluated exclusive of interest, income taxes, depreciation, amortization, restructuring, integration and asset impairment charges, and other expenses and other income. Segment profit is measured because management believes that such information is useful in evaluating the Company's results relative to other entities that operate within our industry. Segment profit is also used as the primary financial measure for purposes of evaluating financial performance under the Company's annual incentive plan.

Three Months ended September 30, 2008 compared to Three Months ended September 30, 2007

                                                                                                                 Quarter Over Quarter
                                                           Three Months Ended September 30,                    Favorable/(Unfavorable)
                                                                 % of                          % of
                                                   2008         Revenue          2007         Revenue          $ Change           % Change
                                                                                  (Dollars in thousands)

Capital markets services revenue                $   42,397            26 %    $   79,579            44 %   $        (37,182 )           (47 )%
Shareholder reporting services revenue:
Compliance reporting                                26,080            16          27,411            15               (1,331 )            (5 )
Investment management                               41,842            25          35,061            19                6,781              19
Translation services                                 4,521             3           3,497             2                1,024              29

Total shareholder reporting services revenue        72,443            44          65,969            36                6,474              10

Marketing and business communications
services revenue                                    42,077            26          26,770            15               15,307              57
Commercial printing and other revenue                7,039             4           9,360             5               (2,321 )           (25 )

Total revenue                                      163,956           100         181,678           100              (17,722 )           (10 )
Cost of revenue                                   (121,901 )         (74 )      (118,596 )         (65 )             (3,305 )            (3 )

Gross margin                                        42,055            26          63,082            35              (21,027 )           (33 )
Selling and administrative expenses                (49,401 )         (30 )       (53,580 )         (29 )              4,179               8

Segment (loss) profit                           $   (7,346 )          (4 )%   $    9,502             6 %   $        (16,848 )          (177 )%

Revenue

Total revenue decreased $17,722, or 10%, to $163,956 for the three months ended September 30, 2008 as compared to the same period in 2007. The decline in revenue is primarily attributed to the decrease in capital markets services revenue which reflects a reduction in overall capital market activity during the three months ended September 30, 2008 as compared to the same period in 2007. Overall capital market activity for the three months ended September 30, 2008 reflects a decrease in overall filing activity of approximately 32% and a decrease in priced initial public offerings ("IPOs") of approximately 71% as compared to the third quarter of 2007. As such, revenue from capital markets services decreased $37,182, or 47%, during the three months ended September 30, 2008 as compared to the same period in 2007, our lowest quarterly level since the mid 1990's. Included in capital markets services revenue for the three months ended September 30, 2008 is $3,637 of revenue related to the Company's virtual dataroom ("VDR") services, which increased 54% as compared to the same period in 2007. Also, offsetting the decrease in capital markets services revenue was the addition of $1,331 of revenue from the acquisition of Capital, which was acquired in July 2008.

Shareholder reporting services revenue increased $6,474, or 10%, to $72,443 for the three months ended September 30, 2008 as compared to the same period in 2007. Shareholder reporting services includes revenue from compliance reporting, investment management and translation services. Compliance reporting revenue decreased approximately 5% for the three months ended September 30, 2008 as compared to the same period in 2007 and investment management revenue increased approximately 19% for the three months ended September 30, 2008 as compared to the same period in 2007. Also, there was an increase in translation services revenue of 29% during the third quarter of 2008 as compared to the same period in 2007. The decrease in compliance reporting revenue is due to several factors, including non-recurring jobs from 2007, timing, fewer filings and competitive pricing pressure. In addition, compliance reporting revenue in 2008 was partially impacted by electronic delivery of compliance documents, resulting in lower print volumes and activity levels for certain clients in 2008 as compared to the same period in 2007. Offsetting the decrease in compliance revenue was $980 of revenue related to the acquisition of Capital. The increase in investment management revenue is primarily a result of the addition of $6,546 of revenue from the acquisitions of GCom and Capital, as previously discussed. The increase in translation services revenue is due to the addition of new clients and increased work from existing clients, primarily in the European market.

Marketing and business communications services revenue increased $15,307, or 57%, during the three months ended September 30, 2008 as compared to the same period in 2007, primarily due to the addition of $17,293 of combined revenue from the Company's recent acquisitions including: Alliance Data Mail Services, GCom and RSG, as previously discussed. The increase in revenue from these acquisitions was partially offset by a decline in revenue generated by the legacy business due to lower activity levels from existing customers, the loss of certain accounts in 2008 as compared to the same period in 2007 and the timing of certain recurring jobs. Commercial printing and other revenue decreased approximately 25% for the three months ended September 30, 2008 as compared to the same period in 2007, primarily due to lower activity levels in 2008 as a result of the general downturn in the economy and competitive pricing pressure.

                                                                                                         Quarter Over Quarter
                                                 Three Months Ended September 30,                      Favorable/(Unfavorable)
                                                        % of                          % of
Revenue by Geography:                   2008           Revenue         2007          Revenue           $ Change           % Change
                                                                         (Dollars in thousands)

Domestic (United States)             $   132,447             81 %    $ 135,656             75 %    $         (3,209 )            (2 )%
International                             31,509             19         46,022             25               (14,513 )           (32 )

Total revenue                        $   163,956            100 %    $ 181,678            100 %             (17,722 )           (10 )%

Revenue from the domestic market decreased 2% to $132,447 for the three months ended September 30, 2008, compared to $135,656 for the three months ended September 30, 2007. This decrease is primarily due to the reduction in capital markets services revenue, and was partially offset by revenue associated with the Company's recent acquisitions, as discussed further above.

Revenue from the international markets decreased 32% to $31,509 for the three months ended September 30, 2008, as compared to $46,022 for the three months ended September 30, 2007. Revenue from the international markets primarily reflects a reduction in capital markets services revenue, primarily due to lower overall capital markets activity in 2008 and a large non-recurring job in Europe that occurred in 2007. These decreases were partially offset by increases in shareholder reporting services revenue in Europe as a result of the addition of new clients and the addition of revenue resulting from the acquisition of GCom.

Gross Margin

Gross margin decreased $21,027, or 33%, for the three months ended September 30, 2008 as compared to the same period in 2007 and the gross margin percentage decreased by nine percentage points, to 26% for the three months ended September 30, 2008 as compared to a gross margin percentage of 35% for the three months ended September 30, 2007. The decrease in gross margin was primarily due to the decrease in capital markets services revenue, which historically is the Company's most profitable class of service. Also contributing to the decrease in gross margin percentage was the margin contribution from our recently acquired businesses, which had lower gross margin percentages than our historical revenue streams. Combined revenue for these acquisitions during the three months ended September 30, 2008 was $26,316, with a gross margin contribution of $4,198, resulting in a gross margin percentage of approximately 16%. Excluding the results of the recent acquisitions, the gross margin percentage would have been approximately 28%, a decrease of seven percentage points as compared to the same . . .