8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 23, 2010

AMERICAN REPROGRAPHICS COMPANY
(Exact name of registrant as specified in its charter)

STATE OF DELAWARE	001-32407	20-1700361
(State or other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

1981 N. Broadway, Suite 385, Walnut Creek, California	94596
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code: (925) 949-5100

(Former name or former address if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On February 23, 2010, American Reprographics Company (the “Company”) issued a press release reporting its financial results for the fourth quarter of 2009 and for the full year ended December 31, 2009. A copy of the press release is furnished as Exhibit 99.1 and is incorporated by reference herein.

The information contained in Item 2.02 of this Current Report on Form 8-K, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.	Description
99.1	American Reprographics Company Press Release, dated February 23, 2010

SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated: February 23, 2010	AMERICAN REPROGRAPHICS COMPANY
	By:	/s/ Kumarakulasingam Suriyakumar
		Kumarakulasingam Suriyakumar
		Chief Executive Officer and President

EXHIBIT INDEX

Exhibit No.	Description
99.1	American Reprographics Company Press Release, dated February 23, 2010

EX-99.1

Exhibit 99.1

AMERICAN REPROGRAPHICS COMPANY REPORTS RESULTS FOR FOURTH QUARTER AND FISCAL YEAR 2009

• Adjusted Annual EPS Fully Diluted: $0.38

• Annual Cash from Operations: $97.4 million

• 2010 Annual Forecast EPS: $0.15 to $0.30

• 2010 Annual Forecast Cash from Operations: $65 million to $80 million

WALNUT CREEK, California (February 23, 2010) — American Reprographics Company (NYSE: ARP) (the “Company”), the nation’s leading provider of reprographic services and technology, today reported its financial results for the full year and fourth quarter ended December 31, 2009.

“We are glad to put 2009 behind us. In spite of the challenging conditions the company performed well,” said K. “Suri” Suriyakumar, Chairman, President and CEO. “The extraordinary efforts we made to right size the company and contain costs in late 2008 and early 2009 allowed us to battle through a very difficult year and come out of it vigorous and healthy. We were able to meet our financial obligations comfortably, make investments in several new products and services to enhance our revenue stream, and reduce our debt obligations by more than $85 million despite a decline in annual sales of more than 28%.”

Jonathan Mather, Chief Financial Officer, said, “While we did not see an upturn in construction-related business during the fourth quarter, we were happy to see slightly stronger sales than we anticipated. Aggressively managing the company to control costs provided us the flexibility and focus to ensure we made the most of every bit of activity in the market.”

Revenue for the year ended December 31, 2009 was $501.6 million, compared to $701.0 million for the year ended December 31, 2008, a 28.5% decline year-over-year. The Company’s gross margin for the year ended December 31, 2009 was 35.5%, compared to 40.7% for the year ended December 31, 2008. Adjusted net income for 2009 was $17.2 million, or $0.38 per diluted share, excluding the effects of previously disclosed one-time charges related to the Company’s annual goodwill impairment assessment, an impairment of long-lived assets, and costs associated with an amendment to our credit agreement and interest rate swap transaction. Adjusted net income for 2008 was $59.0 million, or $1.30 per diluted share excluding the goodwill impairment charge in the fourth quarter of 2008. Net cash from operating activities in 2009 was $97.4 million, compared to $127.3 million in 2008.

Net revenue for the fourth quarter of 2009 was $111.7 million, compared to $154.0 million for the fourth quarter of 2008, a decrease of 27.5%. The Company’s gross margin for the fourth quarter of 2009 was 32.2%, compared to 36.7% for the same period in 2008. Adjusted net income for the fourth quarter of 2009 was $0.4 million, or $0.01 per diluted share, adjusted to exclude one-time charges noted above. This compares to adjusted net income for the fourth quarter of 2008 of $6.5 million, or $0.14 per diluted share, excluding the goodwill impairment charge in the fourth quarter of 2008, as noted above.

Outlook

American Reprographics Company anticipates annual earnings per share in 2010 to be in the range of $0.15 to $0.30 on a fully-diluted basis, and annual cash flow from operations in the range of $65 million to $80 million.

Teleconference and Webcast

American Reprographics Company will host a conference call and audio webcast today at 2:00 P.M. Pacific Time (5:00 P.M. Eastern Time) to discuss results for the Company’s fourth quarter and full year 2009 and business outlook for the first quarter 2010. The conference call can be accessed by dialing 866-921-3926. The conference call ID number is 53459422.

A replay of this call will be available approximately one hour after the call for seven days following the call’s conclusion. To access the replay, dial 800-642-1687. The conference call ID number to access the phone replay is 53459422.

A Web archive will be made available at http://www.e-arc.com for approximately 90 days following the call’s conclusion.

About American Reprographics Company

American Reprographics Company is the leading reprographics company in the United States providing business-to-business document management technology and services to the architectural, engineering and construction, or AEC industries. The Company provides these services to companies in non-AEC industries, such as technology, financial services, retail, entertainment, and food and hospitality, which also require sophisticated document management services. American Reprographics Company provides its core services through its suite of reprographics technology products, a network of hundreds of locally-branded reprographics service centers across the U.S., Canada and the U.K, on-site at more than 5,600 customer locations, and through UDS, a joint-venture company headquartered in Beijing, China. The Company’s service centers are arranged in a hub and satellite structure and are digitally connected as a cohesive network, allowing the provision of services both locally and nationally to more than 138,000 active customers.

Forward-Looking Statements

This press release contains forward-looking statements that are based on current opinions, estimates and assumptions of management regarding future events and the future financial performance of the Company. Words such as “anticipates,” “projects,” “expect” and similar expressions identify forward-looking statements and all statements other than statements of historical fact, including, but not limited to, any projections regarding earnings, revenues and financial performance of the Company, could be deemed forward-looking statements. We caution you that such statements are only predictions and are subject to certain risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statements. Factors that could cause our actual results to differ materially from those set forth in the forward-looking statements include, but are not limited to, the current economic recession and downturn in the architectural, engineering and construction industries specifically; our ability to streamline operations and reduce and/or manage costs; competition in our industry and innovation by our competitors; our failure to anticipate and adapt to future changes in our industry; our failure to take advantage of market opportunities and/or to complete acquisitions; our failure to manage acquisitions, including our inability to integrate and merge the business operations of the acquired companies or failure to retain key personnel and customers of acquired companies; our dependence on certain key vendors for equipment, maintenance services and supplies; damage or disruption to our facilities, our technology centers, our vendors or a majority of our customers; and our failure to continue to develop and introduce new services successfully. The foregoing list of risks and uncertainties is illustrative but is by no means exhaustive. For more information on factors that may affect our future performance, please review our periodic filings with the U.S. Securities and Exchange Commission, and specifically the risk factors set forth in our most recent reports on Form 10-K and Form 10-Q. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

Contacts:

David Stickney	Joseph Villalta
VP of Corporate Communications	The Ruth Group
Phone: 925-949-5100	Phone: 646-536-7003
Email: davidstickney@e-arc.com	Email:jvillalta@theruthgroup.com

American Reprographics Company
Consolidated Balance Sheets
(Dollars in thousands, except per share data)
(Unaudited)

	December 31,			December 31,
	2009			2008
Assets
Current assets:
Cash and cash equivalents	$	29,377		$	46,542
Accounts receivable, net		53,919			77,216
Inventories, net		10,605			11,097
Deferred income taxes		5,568			5,831
Prepaid expenses and other current assets		7,011			11,976
Total current assets		106,480			152,662
Property and equipment, net		74,568			89,712
Goodwill		332,518			366,513
Other intangible assets, net		74,208			85,967
Deferred financing costs, net		4,082			3,537
Deferred income taxes		26,987			25,404
Other assets		2,111			2,136
Total assets	$	620,954		$	725,931
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	23,355		$	25,171
Accrued payroll and payroll-related expenses		8,804			13,587
Accrued expenses		24,540			24,913
Current portion of long-term debt and capital leases		53,520			59,193
Total current liabilities		110,219			122,864
Long-term debt and capital leases		220,711			301,847
Other long-term liabilities		8,000			13,318
Total liabilities		338,930			438,029
Commitments and contingencies
Stockholders’ equity:
American Reprographics Company stockholders’ equity:
Preferred stock, $0.001 par value, 25,000,000 shares authorized; zero and zero shares issued and outstanding		—			—
Common stock, $0.001 par value, 150,000,000 shares authorized; 46,112,653 and 45,674,810 shares issued and 45,664,999 and 45,227,156 shares outstanding in 2009 and 2008, respectively		46			46
Additional paid-in capital		89,982			85,207
Deferred stock-based compensation		—			(195	)
Retained earnings		200,961			215,846
Accumulated other comprehensive loss		(7,273	)		(11,414	)
		283,716			289,490
Less cost of common stock in treasury, 447,654 shares in 2009 and 2008		7,709			7,709
Total American Reprographics Company stockholders’ equity		276,007			281,781
Noncontrolling interest		6,017			6,121
Total stockholders’ equity		282,024			287,902
Total liabilities and stockholders’ equity	$	620,954		$	725,931

American Reprographics Company
Consolidated Statements of Operations
(Dollars in thousands, except per share data)
(Unaudited)

	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2009			2008			2009			2008
Reprographics services	$	75,828		$	108,900		$	350,491		$	518,062
Facilities management		22,243			29,246			97,401			120,983
Equipment and supplies sales		13,591			15,872			53,657			61,942
Total net sales		111,662			154,018			501,549			700,987
Cost of sales		75,738			97,452			323,360			415,715
Gross profit		35,924			56,566			178,189			285,272
Selling, general and administrative expenses		26,685			36,908			115,020			154,728
Amortization of intangible assets		2,693			3,016			11,367			12,004
Goodwill impairment		—			35,154			37,382			35,154
Impairment of long-lived assets		—			—			781			—
Income (loss) from operations		6,546			(18,512	)		13,639			83,386
Other income, net		(33	)		(217	)		(171	)		(517	)
Interest expense, net		7,721			6,005			25,781			25,890
Income before income tax (benefit) provision		(1,142	)		(24,300	)		(11,971	)		58,013
Income tax (benefit) provision		(502	)		(8,677	)		3,018			21,200
Net (loss) income		(640	)		(15,623	)		(14,989	)		36,813
Loss (income) attributable to noncontrolling interest		65			(64	)		104			(59	)
Net (loss) income attributable to American Reprographics Company	$	(575	)	$	(15,687	)	$	(14,885	)	$	36,754
Earnings per share attributable to American Reprographics Company shareholders:
Basic	$	(0.01	)	$	(0.35	)	$	(0.33	)	$	0.82
Diluted	$	(0.01	)	$	(0.35	)	$	(0.33	)	$	0.81
Weighted average common shares outstanding:
Basic		45,393,929			45,078,554			45,185,350			45,060,482
Diluted		45,393,929			45,078,554			45,185,350			45,398,086

American Reprographics Company
Non-GAAP Measures
Reconciliation of cash flows provided by operating activities to EBIT and EBITDA
(Dollars in thousands, except per share data)
(Unaudited)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2009			2008			2009			2008
Cash flows provided by operating activities	$	22,061		$	32,003		$	97,425		$	127,266
Changes in operating assets and liabilities		(11,068	)		(12,734	)		(19,919	)		(4,829	)
Non-cash (expenses) income, including depreciation and amortization		(11,633	)		(34,892	)		(92,495	)		(85,624	)
Income tax (benefit) provision		(502	)		(8,677	)		3,018			21,200
Interest expense		7,721			6,005			25,781			25,890
Net loss (income) attributable to noncontrolling interest		65			(64	)		104			(59	)
EBIT		6,644			(18,359	)		13,914			83,844
Depreciation and amortization		11,892			12,940			49,543			50,121
EBITDA	$	18,536		$	(5,419	)	$	63,457		$	133,965

American Reprographics Company
Non-GAAP Measures
Reconciliation of net (loss) income attributable to ARC to unaudited adjusted net income attributable to ARC
(Dollars in thousands, except per share data)
(Unaudited)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2009			2008			2009			2008
Net (loss) income attributable to ARC	$	(575	)	$	(15,687	)	$	(14,885	)	$	36,754
Goodwill impairment		—			35,154			37,382			35,154
Impairment of long-lived assets		—			—			781			—
Amended Credit Agreement and Swap Transaction costs		1,672			—			2,632			—
Income tax benefit, related to above items		(669	)		(12,932	)		(8,748	)		(12,932	)
Unaudited adjusted net income attributable to ARC	$	428		$	6,535		$	17,162		$	58,976
Earnings per share attributable to ARC shareholders (actual):
Basic	$	(0.01	)	$	(0.35	)	$	(0.33	)	$	0.82
Diluted	$	(0.01	)	$	(0.35	)	$	(0.33	)	$	0.81
Earnings per share attributable to ARC shareholders (adjusted):
Basic	$	0.01		$	0.14		$	0.38		$	1.31
Diluted	$	0.01		$	0.14		$	0.38		$	1.30
Weighted average common shares outstanding (adjusted):
Basic		45,393,929			45,078,554			45,185,350			45,060,482
Diluted		45,524,283			45,353,789			45,328,550			45,398,086

American Reprographics Company
Non-GAAP Measures
Reconciliation of net (loss) income attributable to ARC to EBIT, EBITDA and adjusted EBITDA
(Dollars in thousands)
(Unaudited)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2009			2008			2009			2008
Net (loss) income attributable to ARC	$	(575	)	$	(15,687	)	$	(14,885	)	$	36,754
Interest expense, net		7,721			6,005			25,781			25,890
Income tax (benefit) provision		(502	)		(8,677	)		3,018			21,200
EBIT		6,644			(18,359	)		13,914			83,844
Depreciation and amortization		11,892			12,940			49,543			50,121
EBITDA		18,536			(5,419	)		63,457			133,965
Special items:
Goodwill impairment		—			35,154			37,382			35,154
Impairment of long-lived assets		—			—			781			—
Adjusted EBITDA	$	18,536		$	29,735		$	101,620		$	169,119

Non-GAAP Measures

EBIT, EBITDA and related ratios presented in this report are supplemental measures of our performance that are not required by or presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These measures are not measurements of our financial performance under GAAP and should not be considered as alternatives to net income, income from operations, or any other performance measures derived in accordance with GAAP or as an alternative to cash flows from operating, investing or financing activities as a measure of our liquidity.

EBIT represents net income before interest and taxes. EBITDA represents net income before interest, taxes, depreciation and amortization. Amortization does not include $4.9 million, $4.3 million and $3.5 million of stock based compensation expense recorded in selling, general and administrative expenses, for the years ended December 31, 2009, 2008 and 2007, respectively. EBIT margin is a non-GAAP measure calculated by dividing EBIT by net sales. EBITDA margin is a non-GAAP measure calculated by dividing EBITDA by net sales.

We present EBIT, EBITDA and related ratios because we consider them important supplemental measures of our performance and liquidity. We believe investors may also find these measures meaningful, given how our management makes use of them. The following is a discussion of our use of these measures.

We use EBIT and EBITDA to measure and compare the performance of our operating segments. Our operating segments’ financial performance includes all of the operating activities except for debt and taxation which are managed at the corporate level for U.S. operating segments. As a result, EBIT is the best measure of divisional profitability and the most useful metric by which to measure and compare the performance of our operating segments. We also use EBIT to measure performance for determining operating segment-level compensation and use EBITDA to measure performance for determining consolidated-level compensation. We also use EBIT and EBITDA to evaluate potential acquisitions and to evaluate whether to incur capital expenditures.

EBIT, EBITDA and related ratios have limitations as analytical tools, and you should not consider them in isolation, or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are as follows:

• They do not reflect our cash expenditures, or future requirements for capital expenditures and contractual commitments;

• They do not reflect the significant interest expense, or the cash requirements necessary, to service interest or principal payments on our debt;

• Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDA does not reflect any cash requirements for such replacements; and

• Other companies, including companies in our industry, may calculate these measures differently than we do, limiting their usefulness as comparative measures.

Because of these limitations, EBIT, EBITDA, and related ratios should not be considered as measures of discretionary cash available to us to invest in business growth or to reduce our indebtedness. We compensate for these limitations by relying primarily on our GAAP results and using EBIT, EBITDA and related ratios only as supplements.

We have presented adjusted net income attributable to ARC and adjusted earnings per share attributable to ARC shareholders for the years ended December 31, 2009 and 2008 to reflect the exclusion of the goodwill impairment charge, long-lived assets impairment charge and costs related to the 2009 amendments to the Credit Agreement and Swap Transaction. This presentation facilitates a meaningful comparison of our operating results for the years ended December 31, 2009 and 2008. We presented adjusted EBITDA in 2009 and 2008 to exclude the non-cash impairment charges of $38.2 million and $35.2 million, respectively, as we believe this was a result of the current macroeconomic environment and not indicative of our operations. The exclusion of the goodwill impairment charges and long-lived assets impairment charge, and costs related to the 2009 amendments to the Credit Agreement and Swap Transaction to arrive at adjusted EBITDA is consistent with the definition of adjusted EBITDA in the amendment to the Credit Agreement, therefore we believe this information is useful to investors in assessing our ability to meet our debt covenants.

American Reprographics Company
Consolidated Statements of Cash Flows
(Dollars in thousands)
(Unaudited)

	Three Months Ended						Twelve Months Ended
	December 31,						December 31,
	2009			2008			2009			2008
Cash flows from operating activities
Net (loss) income	$	(640	)	$	(15,623	)	$	(14,989	)	$	36,813
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Allowance for accounts receivable		202			1,802			3,044			4,966
Depreciation		9,199			9,924			38,176			38,117
Amortization of intangible assets		2,693			3,016			11,367			12,004
Amortization of deferred financing costs		385			331			1,357			1,267
Goodwill impairment		—			35,154			37,382			35,154
Impairment of long-lived assets		—			—			781			—
Stock-based compensation		1,328			1,146			4,892			4,289
Excess tax benefit related to stock-based compensation		—			72			(18	)		(30	)
Deferred income taxes		(2,219	)		(16,670	)		(4,477	)		(10,172	)
Write-off of deferred financing costs		190			—			190			313
Other noncash items, net		(145	)		117			(199	)		(284	)
Changes in operating assets and liabilities, net of effect of business acquisitions:
Accounts receivable		9,862			19,656			21,099			21,556
Inventory		989			1,883			1,344			3,134
Prepaid expenses and other assets		2,627			3,694			6,302			(1,101	)
Accounts payable and accrued expenses		(2,410	)		(12,499	)		(8,826	)		(18,760	)
Net cash provided by operating activities		22,061			32,003			97,425			127,266
Cash flows from investing activities
Capital expenditures		(1,654	)		(2,674	)		(7,506	)		(9,033	)
Payments for businesses acquired, net of cash acquired and including other cash payments associated with the acquisitions		(1,504	)		(5,700	)		(3,527	)		(23,916	)
Restricted cash		—			1,959			—			937
Other		968			259			1,684			1,205
Net cash used in investing activities		(2,190	)		(6,156	)		(9,349	)		(30,807	)
Cash flows from financing activities
Proceeds from stock option exercises		—			—			63			177
Proceeds from issuance of common stock under Employee Stock Purchase Plan		48			8			164			35
Excess tax benefit related to stock-based compensation		—			(72	)		18			30
Payments on long-term debt agreements and capital leases		(49,170	)		(13,343	)		(105,008	)		(51,850	)
Net repayments under revolving credit facility		1,523			—			1,523			(22,000	)
Payment of loan fees		(2,048	)		—			(2,092	)		(726	)
Net cash used in financing activities		(49,647	)		(13,407	)		(105,332	)		(74,334	)
Effect of foreign currency translation on cash balances		(26	)		(527	)		91			(385	)
Net change in cash and cash equivalents		(29,802	)		11,913			(17,165	)		21,740
Cash and cash equivalents at beginning of period		59,179			34,629			46,542			24,802
Cash and cash equivalents at end of period	$	29,377		$	46,542		$	29,377		$	46,542
Supplemental disclosure of cash flow information
Noncash investing and financing activities
Noncash transactions include the following:
Capital lease obligations incurred	$	4,047		$	7,950		$	16,181		$	34,561
Issuance of subordinated notes in connection with the acquisition of businesses	$	220		$	2,761		$	466		$	10,414
Accrued liabilities in connection with acquisition of businesses	$	—		$	100		$	—		$	100
Net gain (loss) on derivative, net of tax effect	$	842		$	(8,387	)	$	3,318		$	(9,167	)
Contribution from noncontrolling interest	$	—		$	—		$	—		$	6,062