EX-99.1 2 d78454exv99w1.htm EX-99.1 exv99w1
Exhibit 99.1
(ENNIS LOGO)
FOR IMMEDIATE RELEASE
ENNIS, INC. REPORTS RESULTS
FOR THE THREE AND NINE MONTHS ENDED NOVEMBER 30, 2010
     Midlothian, December 20, 2010 — Ennis, Inc. (the “Company”), (NYSE: EBF), today reported financial results for the three and nine months ended November 30, 2010.
YTD Highlights
    Consolidated revenues for the nine months ended November 30, 2010 were $418.6 million compared to $396.4 million for the same period ended last year, an increase of $22.2 million or 5.6%.
 
    Consolidated gross profit margins increased 280 basis points (“bps”) over the comparable nine month period last year.
 
    Diluted earnings per share increased from $0.98 per share for the same period last year to $1.34 for the current period, or an increase of 36.7%.
Financial Overview
          For the quarter, consolidated net sales increased by $7.0 million, or 5.5%, from $127.8 million for the quarter ended November 30, 2009 to $134.8 million for the quarter ended November 30, 2010. Print sales for the quarter were $69.5 million, compared to $70.6 million for the same quarter last year, or a decrease of 1.5%. Apparel sales for the quarter were $65.3 million, compared to $57.2 million for the same quarter last year, or an increase of 14.2%. Overall gross profit margins (“margins”) increased from 26.8% to 27.1% for the quarters ended November 30, 2009 and November 30, 2010, respectively. Print margins decreased from 28.5% to 27.9%, and Apparel margins increased from 24.8% to 26.3%, for the quarters ended November 30, 2009 and November 30, 2010, respectively. Net earnings increased from $9.2 million, or 7.2% of sales, for the quarter ended November 30, 2009 to $9.6 million, or 7.2% of sales, for the quarter ended November 30, 2010. Diluted EPS increased from $0.36 per share to $0.37 per share for the quarters ended November 30, 2009 and November 30, 2010, respectively.
          For the nine month period, net sales increased from $396.4 million for the nine months ended November 30, 2009 to $418.6 million for the nine months ended November 30, 2010, or 5.6%. Print sales for the period were $206.5 million, compared to $216.3 million for the same period last year, or a decrease of 4.5%. Apparel sales for the period were $212.1 million, compared to $180.1 million for the same period last year, or an increase of 17.8%. Print margins increased from 27.9% to 28.8%, while Apparel margins increased from 22.7% to 27.8%, for the nine months ended November 30, 2009 and 2010, respectively. Net earnings increased from $25.4 million, or 6.4% of sales, for the nine months ended November 30, 2009 to $34.8 million, or 8.3% of sales, for the nine months ended November 30,

 


 

2010. Diluted earnings increased from $0.98 per share to $1.34 per share for the nine months ended November 30, 2009 and 2010, respectively.
          The Company, during the quarter, generated $18.1 million of EBITDA (earnings before interest, taxes, depreciation, and amortization) compared to $18.2 million for the comparable quarter last year. For the nine month period ended November 30, 2010, the Company generated $64.1 million of EBITDA during the period, compared to $51.3 million for the comparable period last year.
                                 
    Three months ended     Nine months ended  
    November 30,     November 30,  
    2010     2009     2010     2009  
Earnings before income taxes
  $ 15,186     $ 14,590     $ 54,822     $ 40,274  
Interest expense
    214       662       972       2,082  
Depreciation/amortization
    2,730       2,928       8,299       8,963  
 
                       
EBITDA (non-GAAP)
  $ 18,130     $ 18,180     $ 64,093     $ 51,319  
 
                       
          Keith Walters, Chairman, Chief Executive Officer and President, commented as follows, “We continue to be pleased with our operational results this year. Operationally, both sectors continue to show strong margins for the quarter. Apparel margins were up 150 bps over the comparable quarter last year and 510 bps for the year. Against stronger comps, our Apparel sector continues to show strong sales growth, with an increase of 14.2% during the quarter. We continue to be concerned with the potential impact of cotton pricing on our operational results for the fourth quarter and fiscal year 2012. Our ability to manage this potential cost increase will be dependent upon many factors, a number of which are outside our control. Examples are the continued economic recovery of the United States, availability of cotton and the pricing policies of our competitors. The construction of our new apparel manufacturing facility in Agua Prieta, Mexico continues to progress. We were testing processes, calibrating equipment and training employees during the quarter. We continue to anticipate potential cost savings to be realized once this facility reaches its full production capacity. Many challenges remain in the fourth quarter and for fiscal year 2012. We will continue to be vigilant to deliver the planned results.”
About Ennis
Ennis, Inc. (www.ennis.com) is primarily engaged in the production of and sale of business forms, apparel and other business products. The Company is one of the largest private-label printed business product suppliers in the United States. Headquartered in Midlothian, Texas, the Company has production and distribution facilities strategically located throughout the United States of America, Mexico and Canada, to serve the Company’s national network of distributors. The Company, together with its subsidiaries, operates in two business segments: the Print Segment (“Print”) and Apparel Segment (“Apparel”). The Print Segment is primarily engaged in the business of manufacturing and selling business forms, other printed business products, printed and electronic media, presentation products, flex-o-graphic printing, advertising specialties and Post-it® Notes, internal bank forms, secure and negotiable documents, envelopes and other custom products. The Apparel Segment manufactures T-Shirts and distributes T-Shirts and other active-wear apparel through six distribution centers located throughout North America.

 


 

Safe Harbor Under The Private Securities Litigation Reform Act of 1995
Certain statements contained in this press release that are not historical facts are forward-looking statements that involve a number of known and unknown risks, uncertainties and other factors that could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievement expressed or implied by such forward-looking statements. The words “anticipate,” “preliminary,” “expect,” “believe,” “intend” and similar expressions identify forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for such forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that a variety of factors could cause actual results and experience to differ materially from the anticipated results or other expectations expressed in such forward-looking statements. These statements are subject to numerous uncertainties, which include, but are not limited to, the Company’s ability to effectively manage its business functions while growing its business in a rapidly changing environment, the Company’s ability to adapt and expand its services in such an environment, the variability in the prices of paper and other raw materials. Other important information regarding factors that may affect the Company’s future performance is included in the public reports that the Company files with the Securities and Exchange Commission. The Company undertakes no obligation to revise any forward-looking statements or to update them to reflect events or circumstances occurring after the date of this release, or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The inclusion of any statement in this release does not constitute an admission by the Company or any other person that the events or circumstances described in such statement are material.
For Further Information Contact:
Mr. Keith Walters, Chairman, Chief Executive Officer and President
Mr. Richard L. Travis, Jr., Chief Financial Officer
Mr. Michael Magill, Executive Vice President
Ennis, Inc.
2441 Presidential Parkway
Midlothian, Texas 76065
Phone: (972) 775-9801
Fax: (972) 775-9820
www.ennis.com

 


 

Ennis, Inc.
Condensed Financial Information
(In thousands, except per share amounts)
                                 
    Three months ended     Nine months ended  
    November 30,     November 30,  
Condensed Operating Results   2010     2009     2010     2009  
Revenues
  $ 134,817     $ 127,756     $ 418,592     $ 396,353  
Cost of goods sold
    98,298       93,456       300,185       295,247  
 
                       
Gross profit margin
    36,519       34,300       118,407       101,106  
Operating expenses
    20,971       19,008       62,494       58,416  
 
                       
Operating income
    15,548       15,292       55,913       42,690  
Other expense
    362       702       1,091       2,416  
 
                       
Earnings before income taxes
    15,186       14,590       54,822       40,274  
Income tax expense
    5,543       5,399       20,010       14,902  
 
                       
Net earnings
  $ 9,643     $ 9,191     $ 34,812     $ 25,372  
 
                       
 
                               
Earnings per share
                               
Basic
  $ 0.37     $ 0.36     $ 1.35     $ 0.99  
 
                       
Diluted
  $ 0.37     $ 0.36     $ 1.34     $ 0.98  
 
                       
                 
    November 30,     February 28,  
Condensed Balance Sheet Information   2010     2010  
Assets
               
Current assets
               
Cash
  $ 18,308     $ 21,063  
Accounts receivable, net
    54,333       57,249  
Inventories, net
    98,898       75,137  
Other
    9,818       12,990  
 
           
 
    181,357       166,439  
 
           
Property, plant & equipment
    90,065       65,720  
Other
    198,360       200,540  
 
           
 
  $ 469,782     $ 432,699  
 
           
Liabilities and Shareholders’ Equity
               
Current liabilities
               
Accounts payable
  $ 21,210     $ 27,463  
Accrued expenses
    30,955       22,338  
 
           
 
    52,165       49,801  
 
           
Long-term debt
    50,908       41,817  
Deferred credits
    29,023       27,821  
 
           
Total liabilities
    132,096       119,439  
 
           
 
Shareholders’ equity
    337,686       313,260  
 
           
 
  $ 469,782     $ 432,699  
 
           
                 
    Nine months ended  
    November 30,  
Condensed Cash Flow Information   2010     2009  
Cash provided by operating activities
  $ 30,642     $ 71,469  
Cash used in investing activities
    (31,147 )     (11,731 )
Cash used in financing activities
    (2,018 )     (46,575 )
Effect of exchange rates on cash
    (232 )     145  
 
           
Change in cash
    (2,755 )     13,308  
Cash at beginning of period
    21,063       9,286  
 
           
Cash at end of period
  $ 18,308     $ 22,594