EX-99.1 2 d52640exv99w1.htm PRESS RELEASE exv99w1
 

EXHIBIT 99.1
(ENNIS LOGO)
FOR IMMEDIATE RELEASE
ENNIS, INC. REPORTS RESULTS
FOR THE THREE AND NINE MONTHS ENDED NOVEMBER 30, 2007
REVENUES & EARNINGS INCREASE
     Midlothian, Texas December 21, 2007 — Ennis, Inc. (the “Company”), (NYSE: EBF), today reported financial results for the three and nine months ended November 30, 2007.
Quarterly Highlights
  §   Consolidated revenues for the quarter increased 4.3% from $151.7 million to $158.2 million.
 
  §   Print revenues increased by 3.5% for the quarter from $85.7 million to $88.7 million.
 
  §   Apparel revenues increased by 5.1% from $66.1 million to $69.5 million.
 
  §   Net Income increased 6.9% from $10.8 million to $11.6 million for the quarter ended November 30, 2007.
 
  §   Diluted EPS increased 7.1% from $0.42 per share to $0.45 per share
Financial Overview
     For the quarter, our net sales increased by $6.5 million, or 4.3% from $151.7 million for the three months ended November 30, 2006 to $158.2 million for the three months ended November 30, 2007. Our Print sales for the quarter were $88.7 million, compared to $85.7 million for the same quarter last year. Apparel sales for the quarter were $69.5 million, compared to $66.1 million for the same quarter last year. Our overall gross profit margins (“margins”) during the quarter decreased slightly from 25.0% to 24.8% for the three months ended November 30, 2006 and 2007, respectively. Our Print margins increased from 25.6% to 26.8%, while the Apparel margins decreased from 24.2% to 22.2%, for the three months ended November 30, 2006 and 2007, respectively. Our earnings for the quarter increased 6.9% from $10.8 million for the three months ended November 30, 2006 to $11.6 million for the three months ended November 30, 2007. Diluted earnings per share increased 7.1% from $.42 per share to $.45 per share for the three months ended November 30, 2006 and 2007, respectively.
     For the year to date period, our net sales increased from $448.6 million for the nine months ended November 30, 2006 to $461.1 million for the nine months ended November 30, 2007, or 2.8%. Our Print sales for the period were $257.4 million, compared to $245.0 million for the same period last year. Our Apparel sales remained level at $203.6 million for the nine

 


 

months ended November 30, 2007 and 2006. Our Print margins increased from 25.2% to 27.0%, while our Apparel margins decreased from 25.7% to 23.0%, for the nine months ended November 30, 2006 and 2007, respectively. Our earnings for the period decreased slightly from $33.8 million for the nine months ended November 30, 2006 to $33.5 million for the nine months ended November 30, 2007. Diluted earnings per share decreased slightly from $1.31 per share to $1.30 per share for the nine months ended November 30, 2006 and 2007, respectively.
     The Company during the quarter generated $23.4 million in EBITDA (earnings before interest, taxes, depreciation and amortization) compared to $23.3 million for the comparable quarter last year. For the period, the Company generated $68.7 million in EBITDA compared to $72.1 million for the comparable period last year.
Reconciliation of Non-GAAP to GAAP measure (dollars in thousands):
                                 
    Three months ended     Nine months ended  
    November 30,     November 30,  
    2007     2006     2007     2006  
Earnings before income taxes
  $ 18,360     $ 17,177     $ 53,177     $ 53,642  
Interest expense
    1,398       1,853       4,283       5,363  
Depreciation/amortization
    3,643       4,266       11,226       13,048  
 
                       
EBITDA (non-GAAP)
  $ 23,401     $ 23,296     $ 68,686     $ 72,053  
 
                       
Keith Walters, Chairman, President & CEO, commented by saying, “We are extremely pleased with our results for the quarter, both from a revenue and EPS growth perspective, especially compared to our competition in the print and apparel marketplace. We continue to see the positive impact of our cost reduction programs on our Print margins. We are also extremely pleased with the increase in our Apparel sales during the quarter. We had indicated in our Form 10-Q filing last quarter that we fully expected our Apparel sales would rebound this quarter and we are pleased to see that they in fact did. While our Apparel operating margins this quarter were only marginally lower than last year, our Apparel gross profit margins during the quarter were impacted mainly by the increased costs associated with our apparel inventory build and to a lesser extent by slightly higher cotton prices and lower selling prices. In addition, during the quarter, we completed two Print acquisitions which added $5.8 million in Print revenue. Overall, we feel good about where we are at and how our year is shaping up. We feel we have addressed the issues impacting our results during the first two quarters of this year and have these issues well under control at this point.”
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. Michael Magill, Executive Vice President
Mr. Richard L. Travis, Jr., Chief Financial Officer
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   2007     2006     2007     2006  
Revenues
  $ 158,215     $ 151,743     $ 461,075     $ 448,574  
Cost of goods sold
    118,971       113,770       344,644       334,545  
 
                       
Gross profit
    39,244       37,973       116,431       114,029  
Operating expenses
    19,323       18,450       57,054       54,850  
 
                       
Operating income
    19,921       19,523       59,377       59,179  
Other expense
    1,561       2,346       6,200       5,537  
Income tax expense
    6,792       6,355       19,675       19,847  
 
                       
Net earnings
  $ 11,568     $ 10,822     $ 33,502     $ 33,795  
 
                       
 
                               
Earnings per share
                               
Basic
  $ 0.45     $ 0.42     $ 1.31     $ 1.32  
 
                       
Diluted
  $ 0.45     $ 0.42     $ 1.30     $ 1.31  
 
                       
                 
Condensed Balance Sheet Information   November 30,     February 28,  
    2007     2007  
Current assets:
               
Cash
  $ 2,156     $ 3,582  
Accounts receivable, net
    70,791       47,285  
Inventories, net
    101,760       85,696  
Other
    12,795       14,953  
 
           
 
    187,502       151,516  
 
           
Property, plant & equipment
    60,607       63,057  
Other
    268,326       263,655  
 
           
 
  $ 516,435     $ 478,228  
 
           
Current liabilities
               
Accounts payable
  $ 28,654     $ 25,597  
Accrued expenses
    25,315       22,998  
Current portion of long-term debt
    305       652  
 
           
 
    54,274       49,247  
 
           
Long-term debt
    97,265       88,971  
Deferred credits
    24,849       23,607  
 
           
Total liabilities
    176,388       161,825  
 
           
 
               
Shareholders’ equity
    340,047       316,403  
 
           
 
  $ 516,435     $ 478,228  
 
           
                 
    Nine months ended  
    November 30,  
Condensed Cash Flow Information   2007     2006  
Cash provided by operating activities
  $ 17,615     $ 37,128  
Cash used in investing activities
    (16,243 )     (18,060 )
Cash used in financing activities
    (2,987 )     (25,236 )
Effect of exchange rates on cash
    189       (106 )
 
           
Change in cash
    (1,426 )     (6,274 )
Cash at beginning of period
    3,582       13,860  
 
           
Cash at end of period
  $ 2,156     $ 7,586