Segment Information and Geographic Information

6 Months Ended

Aug. 31, 2014

Segment Reporting [Abstract]

Segment Information and Geographic Information

12. Segment Information and Geographic Information

The Company operates in two segments–the Print Segment and the Apparel Segment.

The Print Segment, which represented 64% of the Company’s consolidated net sales for the three and six months ended August 31, 2014, is in the business of manufacturing, designing, and selling business forms and other printed business products primarily to distributors located in the United States. The Print Segment operates 55 manufacturing plants throughout the United States in 22 strategically located states. Approximately 96% of the business products manufactured by the Print Segment are custom and semi-custom products, constructed in a wide variety of sizes, colors, number of parts and quantities on an individual job basis depending upon the customers’ specifications.

The products sold include snap sets, continuous forms, laser cut sheets, tags, labels, envelopes, integrated products, jumbo rolls and pressure sensitive products in short, medium and long runs under the following labels: Ennis®, Royal Business Forms®, Block Graphics®, Specialized Printed Forms®, 360º Custom Labels^SM, ColorWorx®, Enfusion®, Uncompromised Check Solutions®, VersaSeal®, Witt Printing®, B&D Litho®, Genforms®, PrintGraphics^SM, Calibrated Forms®, PrintXcel^SM, Printegra®, Curtis Business Forms^SM, Falcon Business Forms^SM, Forms Manufacturers^SM, Mutual Graphics^SM and TRI-C Business Forms^SM. The Print Segment also sells the Adams-McClure® brand (which provides Point of Purchase advertising for large franchise and fast food chains as well as kitting and fulfillment); the Admore® and Folder Express® brands (which provide presentation folders and document folders); Ennis Tag & Label^SM (which provides custom printer high performance labels and custom and stock tags); Atlas Tag & Label® (which provides custom and stock tags and labels); Trade Envelopes® and Block Graphics®, Wisco® and National Imprint Corporation® (which provide custom and imprinted envelopes) and Northstar® and General Financial Supply® (which provide financial and security documents).

The Print Segment sells predominantly through private printers and independent distributors. Northstar also sells direct to a small number of customers. Northstar has continued its focus with large banking organizations on a direct basis (where a distributor is not acceptable or available to the end-user) and has acquired several of the top 25 banks in the United States as customers and is actively working on other large banks within the top 25 tier of banks in the United States. Adams-McClure sales are generally provided through advertising agencies. Assets in this segment increased in 2014 primarily as a result of the Company’s acquisition of Wisco, NIC and Folder Express.

The Apparel Segment, which accounted for 36% of the Company’s consolidated net sales for the three and six months ended August 31, 2014, consists of Alstyle Apparel. This group is primarily engaged in the production and sale of activewear including t-shirts, fleece goods, and other wearables. Alstyle sales are seasonal, with sales in the first and second quarters generally being the highest. Substantially all of the Apparel Segment sales are to customers in the United States.

Corporate information is included to reconcile segment data to the consolidated financial statements and includes assets and expenses related to the Company’s corporate headquarters and other administrative costs.

Segment data for the three and six months ended August 31, 2014 and August 31, 2013 were as follows (in thousands):

	Print		Apparel					Consolidated
	Segment		Segment		Corporate			Totals
Three months ended August 31, 2014:
Net sales	$	97,881	$	53,960	$	—		$	151,841
Depreciation		1,627		945		67			2,639
Amortization of identifiable intangibles		1,053		366		—			1,419
Segment earnings (loss) before income tax		18,295		911		(3,307	)		15,899
Segment assets		232,178		296,202		17,641			546,021
Capital expenditures		498		119		5			622
Three months ended August 31, 2013:
Net sales	$	78,953	$	56,335	$	—		$	135,288
Depreciation		1,361		962		42			2,365
Amortization of identifiable intangibles		429		366		—			795
Segment earnings (loss) before income tax		13,607		5,901		(3,953	)		15,555
Segment assets		159,637		303,450		24,192			487,279
Capital expenditures		874		33		597			1,504
Six months ended August 31, 2014:
Net sales	$	186,265	$	106,762	$	—		$	293,027
Depreciation		3,191		1,896		134			5,221
Amortization of identifiable intangibles		2,103		733		—			2,836
Segment earnings (loss) before income tax		33,777		2,087		(7,216	)		28,648
Segment assets		232,178		296,202		17,641			546,021
Capital expenditures		750		166		11			927
Six months ended August 31, 2013:
Net sales	$	160,392	$	113,362	$	—		$	273,754
Depreciation		2,738		1,932		82			4,752
Amortization of identifiable intangibles		857		733		—			1,590
Segment earnings (loss) before income tax		27,054		10,269		(8,265	)		29,058
Segment assets		159,637		303,450		24,192			487,279
Capital expenditures		1,353		183		637			2,173

Identifiable long-lived assets by country include property, plant, and equipment, net of accumulated depreciation. The Company attributes revenues from external customers to individual geographic areas based on the country where the sale originated. Information about the Company’s operations in different geographic areas as of and for the three and six months ended is as follows (in thousands):

	United States		Canada		Mexico		Total
Three months ended August 31, 2014:
Net sales to unaffiliated customers
Print Segment	$	97,881	$	—	$	—	$	97,881
Apparel Segment		47,962		5,364		634		53,960
	$	145,843	$	5,364	$	634	$	151,841
Identifiable long-lived assets
Print Segment	$	44,699	$	—	$	—	$	44,699
Apparel Segment		114		64		42,505		42,683
Corporate		3,650		—		—		3,650
	$	48,463	$	64	$	42,505	$	91,032
Three months ended August 31, 2013:
Net sales to unaffiliated customers
Print Segment	$	78,953	$	—	$	—	$	78,953
Apparel Segment		50,717		5,510		108		56,335
	$	129,670	$	5,510	$	108	$	135,288
Identifiable long-lived assets
Print Segment	$	39,007	$	—	$	—	$	39,007
Apparel Segment		191		46		44,681		44,918
Corporate		3,859		—		—		3,859
	$	43,057	$	46	$	44,681	$	87,784
Six months ended August 31, 2014:
Net sales to unaffiliated customers
Print Segment	$	186,265	$	—	$	—	$	186,265
Apparel Segment		95,964		9,991		807		106,762
	$	282,229	$	9,991	$	807	$	293,027
Six months ended August 31, 2013:
Net sales to unaffiliated customers
Print Segment	$	160,392	$	—	$	—	$	160,392
Apparel Segment		102,419		10,772		171		113,362
	$	262,811	$	10,772	$	171	$	273,754