Since 1971, VCI has grown from a company with a single printing press and a single product, the free standing insert (FSI), to become a full-service marketing services company. VCI currently offers a range of specialty media programs to manufacturers, retailers, and Internet/e-commerce companies to support its mission of connecting people to brands. Products include newspaper-delivered co-op and specialty inserts, advertising, product sampling, direct mail, online promotions, loyalty marketing programs, and consulting services. The company has five reportable segments: free-standing inserts (68% of 2002 revenues), cluster targeted products (23%), 1-to-1 solutions (4%), ROP (4%), and international and services (1%).

FSIs form the core of the company's mass marketing business. VCI has published these four-color promotional booklets containing coupons of multiple advertisers since 1972. In 2002, FSIs were inserted in the Sunday edition of 525 newspapers, with average paid circulation of 59 million, on 44 publishing dates. This business also provides run-of-press (ROP) advertising, which prints promotions directly on the pages of 13,000 newspapers. Paper accounts for about 32% of the cost of products sold for the company's FSI business. As of January 1, 2003, about 90% of VCI's FSI paper requirements were under long-term contract.

Through its cluster-targeted marketing products, VCI provides customized print promotions that run in newspapers throughout the U.S. Customized formats include die-cuts, posters, calendars, and traditional FSI formats. The segment's products include newspaper-delivered product samples, polybag advertising, and solo inserts (e.g. posters, calendars and FSIs).

The 1-to-1 solutions business includes customer relationship marketing (CRM), direct mail sampling, security consulting services for promotions such as sweepstakes and contests, and Internet marketing. CRM lets companies understand consumer behavior and deliver targeted promotions. In March 2003, the company acquired for $1 million the remaining 11% interest in Valassis Retail Marketing Systems (VRMS) that it did not already own. VRMS provides a direct mail vehicle that uses proprietary software to target frequent grocery shoppers based on prior purchases. In August 2000, VCI acquired an 80% interest in PreVision Marketing, a CRM concern specializing in one-to-one marketing, customer retention, and customer acquisition. In August 2001, VCI ceased funding Save.com and Internet Delivery Systems, two Internet promotions ventures, due to deteriorating financial conditions

VCI is authorized to repurchase common stock for up to 75% of its free cash flow, but it did not purchase any shares during the 2003 second or third quarters. In January 2002, the company launched a marketing joint venture intended to reach Spanish-speaking consumers, and to establish VCI as the primary provider of printed promotions to the rapidly growing U.S. Hispanic population.

In February, the company acquired NCH Marketing Services, a coupon processing and promotion information management concern, for $59.3 million in cash; NCH had 2002 sales of $72.3 million.

Address	19975 Victor Parkway
	Livonia MI, 48152
Phone	734-591-3000
Fax	734-591-4994
Web site	http://www.valassis.com/
Ticker	VCI
Exchange	NYSE
Incorporated	in Delaware in 1986.
Chrmn, Pres & CEO	A. F. Schultz.
EVP & CFO	R. L. Recchia.
EVP & Gen Counsel	B. P Hoffman.
VP & Investor Contact	Lynn M. Liddle.
Dirs	P. F. Brennan, K. V. Darish, S. Goldstein, B. P. Hoffman, W. H. Ku, R. L. Recchia, M. A. Sampson, A. F. Schultz, F. Whit
Transfer Agent & Registrar	American Stock Transfer & Trust Co.
Employees	1556
S&P Analyst	Paul Huberman