Segment Information and Geographic Information

9 Months Ended

Nov. 30, 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 66% and 65% of the Company’s consolidated net sales for the three and nine months ended November 30, 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 56 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 34% and 35% of the Company’s consolidated net sales for the three and nine months ended November 30, 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 nine months ended November 30, 2014 and November 30, 2013 were as follows (in thousands):

	Print		Apparel						Consolidated
	Segment		Segment			Corporate			Totals
Three months ended November 30, 2014:
Net sales	$	97,652	$	49,319		$	—		$	146,971
Depreciation		1,599		928			67			2,594
Amortization of identifiable intangibles		1,046		367			—			1,413
Impairment of goodwill and trademarks		—		93,324			—			93,324
Segment earnings (loss) before income tax		17,100		(93,218	)		(4,617	)		(80,735	)
Segment assets		229,111		196,467			19,139			444,717
Capital expenditures		615		63			19			697
Three months ended November 30, 2013:
Net sales	$	89,671	$	46,879		$	—		$	136,550
Depreciation		1,502		956			56			2,514
Amortization of identifiable intangibles		858		367			—			1,225
Segment earnings (loss) before income tax		16,040		3,014			(4,215	)		14,839
Segment assets		224,233		317,314			16,050			557,597
Capital expenditures		1,002		850			18			1,870
Nine months ended November 30, 2014:
Net sales	$	283,917	$	156,081		$	—		$	439,998
Depreciation		4,790		2,824			201			7,815
Amortization of identifiable intangibles		3,149		1,100			—			4,249
Impairment of goodwill and trademarks		—		93,324			—			93,324
Segment earnings (loss) before income tax		50,877		(91,131	)		(11,833	)		(52,087	)
Segment assets		229,111		196,467			19,139			444,717
Capital expenditures		1,365		229			30			1,624
Nine months ended November 30, 2013:
Net sales	$	250,063	$	160,241		$	—		$	410,304
Depreciation		4,240		2,888			138			7,266
Amortization of identifiable intangibles		1,715		1,100			—			2,815
Segment earnings (loss) before income tax		43,094		13,283			(12,480	)		43,897
Segment assets		224,233		317,314			16,050			557,597
Capital expenditures		2,355		1,033			655			4,043

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 nine months ended is as follows (in thousands):

	United States		Canada		Mexico		Total
Three months ended November 30, 2014:
Net sales to unaffiliated customers
Print Segment	$	97,652	$	—	$	—	$	97,652
Apparel Segment		44,873		4,104		342		49,319
	$	142,525	$	4,104	$	342	$	146,971
As of November 30, 2014
Identifiable long-lived assets
Print Segment	$	43,541	$	—	$	—	$	43,541
Apparel Segment		104		60		40,348		40,512
Corporate		3,603		—		—		3,603
	$	47,248	$	60	$	40,348	$	87,656
Three months ended November 30, 2013:
Net sales to unaffiliated customers
Print Segment	$	89,671	$	—	$	—	$	89,671
Apparel Segment		42,157		4,567		155		46,879
	$	131,828	$	4,567	$	155	$	136,550
As of November 30, 2013
Identifiable long-lived assets
Print Segment	$	45,022	$	—	$	—	$	45,022
Apparel Segment		168		44		44,941		45,153
Corporate		3,821		—		—		3,821
	$	49,011	$	44	$	44,941	$	93,996
Nine months ended November 30, 2014:
Net sales to unaffiliated customers
Print Segment	$	283,917	$	—	$	—	$	283,917
Apparel Segment		140,837		14,095		1,149		156,081
	$	424,754	$	14,095	$	1,149	$	439,998
Nine months ended November 30, 2013:
Net sales to unaffiliated customers
Print Segment	$	250,063	$	—	$	—	$	250,063
Apparel Segment		144,576		15,339		326		160,241
	$	394,639	$	15,339	$	326	$	410,304