10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended November 30, 2017

OR

☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Transition Period from to

Commission File Number 1-5807

ENNIS, INC.

(Exact Name of Registrant as Specified in Its Charter)

Texas	75-0256410
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
2441 Presidential Pkwy., Midlothian, Texas	76065
(Address of Principal Executive Offices)	(Zip code)

(972) 775-9801

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes   ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Date File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  ☒    No  ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐		Accelerated filer	☒
Non-accelerated filer	☐	(Do not check if a smaller reporting company)	Smaller reporting company	☐
			Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of December 29, 2017, there were 25,416,890 shares of the Registrant’s common stock outstanding.

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

TABLE OF CONTENTS

PART I: FINANCIAL INFORMATION
	Item 1. Financial Statements	3
	Unaudited Consolidated Balance Sheets at November 30, 2017 and February 28, 2017	3
	Unaudited Consolidated Statements of Operations for the three and nine months ended November 30, 2017 and November 30, 2016	5
	Unaudited Consolidated Statements of Comprehensive Income for the three and nine months ended November 30, 2017 and November 30, 2016	6
	Unaudited Consolidated Statement of Changes in Shareholders’ Equity for the nine months ended  November 30, 2017	7
	Unaudited Consolidated Statements of Cash Flows for the nine months ended November 30, 2017 and November 30, 2016	8
	Notes to Unaudited Consolidated Financial Statements	9
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
	Item 3. Quantitative and Qualitative Disclosures About Market Risk	26
	Item 4. Controls and Procedures	26
PART II: OTHER INFORMATION
	Item 1. Legal Proceedings	27
	Item 1A. Risk Factors	27
	Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	27
	Item 3. Defaults Upon Senior Securities	27
	Item 4. Mine Safety Disclosures	27
	Item 5. Other Information	27
	Item 6. Exhibits	28
SIGNATURES		29

2

PART I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

ENNIS, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED BALANCE SHEETS

(in thousands)

	November 30,		February 28,
	2017		2017
Assets
Current assets
Cash and cash equivalents	$	92,930	$	80,466
Accounts receivable, net of allowance for doubtful receivables of $1,306 at    November 30, 2017and $1,674 at February 28, 2017		38,409		37,368
Prepaid expenses		1,228		1,351
Prepaid income taxes		888		855
Inventories		27,799		27,965
Assets held for sale		1,320		1,245
Total current assets		162,574		149,250
Property, plant and equipment
Plant, machinery and equipment		135,367		136,584
Land and buildings		53,587		53,821
Other		23,556		23,644
Total property, plant and equipment		212,510		214,049
Less accumulated depreciation		166,274		164,054
Net property, plant and equipment		46,236		49,995
Goodwill		70,603		70,603
Intangible assets, net		50,746		53,927
Other assets		357		510
Total assets	$	330,516	$	324,285

See accompanying notes to consolidated financial statements.

3

ENNIS, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED BALANCE SHEETS

(in thousands, except for par value and share amounts)

	November 30,			February 28,
	2017			2017
Liabilities and Shareholders’ Equity
Current liabilities
Accounts payable	$	9,988		$	14,202
Accrued expenses
Employee compensation and benefits		14,775			13,515
Taxes other than income		357			225
Other		1,880			2,026
Total current liabilities		27,000			29,968
Long-term debt		30,000			30,000
Liability for pension benefits		4,846			4,846
Deferred income taxes		7,408			6,953
Other liabilities		1,511			1,163
Total liabilities		70,765			72,930
Commitments and contingencies
Shareholders’ equity
Preferred stock $10 par value, authorized 1,000,000 shares; none issued		—			—
Common stock $2.50 par value, authorized 40,000,000 shares; issued 30,053,443 shares at    November 30 and February 28, 2017		75,134			75,134
Additional paid-in capital		121,010			121,525
Retained earnings		160,648			150,685
Accumulated other comprehensive loss:
Minimum pension liability, net of taxes		(14,517	)		(15,261	)
Total accumulated other comprehensive loss		(14,517	)		(15,261	)
Treasury stock		(82,524	)		(80,728	)
Total shareholders’ equity		259,751			251,355
Total liabilities and shareholders' equity	$	330,516		$	324,285

See accompanying notes to consolidated financial statements.

4

ENNIS, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share amounts)

	Three months ended						Nine months ended
	November 30,						November 30,
	2017			2016			2017			2016
Net sales	$	93,606		$	88,660		$	283,083		$	270,316
Cost of goods sold		63,722			63,368			192,493			191,292
Gross profit margin		29,884			25,292			90,590			79,024
Selling, general and administrative		16,699			15,833			51,167			47,961
(Gain) loss from disposal of assets		(4	)		264			59			266
Income from operations		13,189			9,195			39,364			30,797
Other income (expense)
Interest expense		(163	)		(172	)		(557	)		(405	)
Other, net		108			88			238			92
Total other expense		(55	)		(84	)		(319	)		(313	)
Earnings from continuing operations before income taxes		13,134			9,111			39,045			30,484
Income tax expense		4,860			3,371			14,447			11,277
Earnings from continuing operations		8,274			5,740			24,598			19,207
Income from discontinued operations, net of tax		—			—			—			2,481
Loss on sale of discontinued operations, net of tax		—			—			—			(26,042	)
Loss from discontinued operations, net of tax		—			—			—			(23,561	)
Net earnings (loss)	$	8,274		$	5,740		$	24,598		$	(4,354	)
Weighted average common shares outstanding
Basic		25,360,452			25,673,824			25,387,389			25,802,658
Diluted		25,393,482			25,683,613			25,409,259			25,818,146
Earnings (loss) per share - basic and diluted
Continuing operations	$	0.33		$	0.22		$	0.97		$	0.74
Discontinued operations	$	—		$	—		$	—		$	(0.91	)
Net earnings (loss)	$	0.33		$	0.22		$	0.97		$	(0.17	)
Cash dividends per share	$	0.200		$	0.175		$	0.575		$	2.025

See accompanying notes to consolidated financial statements.

5

ENNIS, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

	Three months ended				Nine months ended
	November 30,				November 30,
	2017		2016		2017		2016
Net earnings (loss)	$	8,274	$	5,740	$	24,598	$	(4,354	)
Foreign currency translation adjustment, net of deferred taxes		—		—		—		9,940
Adjustment to pension, net of deferred taxes		248		—		744		—
Comprehensive income	$	8,522	$	5,740	$	25,342	$	5,586

See accompanying notes to consolidated financial statements.

6

ENNIS, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY

(in thousands, except share and per share amounts)

											Accumulated
					Additional						Other
	Common Stock				Paid-in			Retained			Comprehensive			Treasury Stock
	Shares		Amount		Capital			Earnings			Income (Loss)			Shares			Amount			Total
Balance March 1, 2017		30,053,443	$	75,134	$	121,525		$	150,685		$	(15,261	)		(4,686,821	)	$	(80,728	)	$	251,355
Net earnings		—		—		—			24,598			—			—			—			24,598
Adjustment to pension, net of deferred tax of    $456		—		—		—			—			744			—			—			744
Dividends paid ($0.575 per share)		—		—		—			(14,635	)		—			—			—			(14,635	)
Stock based compensation		—		—		1,002			—			—			—			—			1,002
Exercise of stock options and restricted stock		—		—		(1,517	)		—			—			88,105			1,517			—
Common stock repurchases		—		—		—			—			—			(191,178	)		(3,313	)		(3,313	)
Balance November 30, 2017		30,053,443	$	75,134	$	121,010		$	160,648		$	(14,517	)		(4,789,894	)	$	(82,524	)	$	259,751

See accompanying notes to consolidated financial statements.

7

ENNIS, INC. AND SUBSIDIARIES

UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Nine months ended
	November 30,
		2017			2016
Cash flows from operating activities:
Net earnings (loss)	$	24,598		$	(4,354	)
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:
Depreciation		6,016			5,944
Amortization of deferred finance charges		85			36
Amortization of intangible assets		4,566			3,494
Pre-tax loss from discontinued operations		—			36,775
Operating cash flows of discontinued operations		—			538
Loss from disposal of assets		59			266
Bad debt expense, net of recoveries		(231	)		118
Stock based compensation		1,002			1,019
Deferred income taxes		(1	)		—
Changes in operating assets and liabilities, net of the effects of acquisitions:
Accounts receivable		(810	)		1,426
Prepaid expenses and income taxes		90			(1,620	)
Inventories		247			722
Other assets		67			(593	)
Accounts payable and accrued expenses		(3,418	)		(3,121	)
Other liabilities		348			(7	)
Liability for pension benefits		1,200			1,917
Net cash provided by operating activities		33,818			42,560
Cash flows from investing activities:
Capital expenditures		(2,092	)		(1,912	)
Purchase of businesses, net of cash acquired		(1,350	)		(907	)
Proceeds from sale of discontinued operations		—			107,354
Investing cash flows of discontinued operations		—			(279	)
Proceeds from disposal of plant and property		36			663
Net cash provided by (used in) investing activities		(3,406	)		104,919
Cash flows from financing activities:
Repayment of debt		—			(10,000	)
Dividends paid		(14,635	)		(52,724	)
Common stock repurchases		(3,313	)		(7,757	)
Proceeds from exercise of stock options		—			2,910
Net cash used in financing activities		(17,948	)		(67,571	)
Net change in cash and cash equivalents		12,464			79,908
Cash and cash equivalents at beginning of period		80,466			7,957
Cash and cash equivalents at end of period	$	92,930		$	87,865

See accompanying notes to consolidated financial statements.

8

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

1. Significant Accounting Policies and General Matters

Basis of Presentation

These unaudited consolidated financial statements of Ennis, Inc. and its subsidiaries (collectively referred to as the “Company,” “Registrant,” “Ennis,” or “we,” “us,” or “our”) for the period ended November 30, 2017 have been prepared in accordance with generally accepted accounting principles for interim financial reporting.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended February 28, 2017, from which the accompanying consolidated balance sheet at February 28, 2017 was derived.  All intercompany balances and transactions have been eliminated in consolidation.  In the opinion of management, all adjustments considered necessary for a fair presentation of the interim financial information have been included and are of a normal recurring nature. In preparing the financial statements, the Company is required to make estimates and assumptions that affect the disclosure and reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates and judgments on an ongoing basis, including those related to bad debts, inventory valuations, property, plant and equipment, intangible assets, pension plan, accrued liabilities, and income taxes. The Company bases estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances. The results of operations for any interim period are not necessarily indicative of the results of operations for a full year.

On May 25, 2016, the Company sold Alstyle Apparel, LLC and its subsidiaries, which constituted the Company’s apparel segment (the “Apparel Segment”), to Gildan Activewear Inc.  As a result of this action, the current year and prior year disclosures reflect these operations as discontinued operations.

Recent Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”).  The update requires the service cost component of net benefit costs to be reported in the same line of the income statement as other compensation costs and the other components of net benefit costs (non-service costs) to be presented separately from the service cost component, outside a subtotal of operating income.  Additionally, only the service cost component of net benefit costs will be eligible for capitalization.  The update is required to be adopted the first quarter of fiscal year 2019 and is required to be retrospectively adopted.  The Company is currently evaluating the impact the adoption of ASU 2017-07 will have on its consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which simplifies how an entity is required to measure goodwill impairment.  The amendments in ASU 2017-04 require that goodwill impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit and the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.  The amendments in ASU 2017-04 should be applied on a prospective basis and are effective for annual or any interim goodwill impairment tests in annual reporting periods beginning after December 15, 2019.  The Company adopted ASU 2017-04 on June 1, 2017, which had no impact on the Company’s consolidated financial statements at the time of adoption.

In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718) (“ASU 2016-09”), which makes several modifications to the accounting for employee share-based payment transactions, including the requirement to recognize the income tax effects of awards that vest or settle as income tax expense.  The amendments in ASU 2016-09 also clarify the presentation of certain components of share-based awards in the statement of cash flows.  ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016.  The Company adopted ASU 2016-09 in fiscal year 2018 beginning in March of 2017.  The adoption of ASU 2016-09 did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”), which requires lessees to put most leases on the balance sheet but recognize expense on the income statement in a manner similar to current accounting.  For lessors, ASU 2016-02 also modifies the classification criteria and the accounting for sales-type and direct financing leases.  The standard requires a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements and is effective in the first quarter of fiscal year 2020.  Early adoption of ASU 2016-02 is permitted.  The Company is currently evaluating the impact the adoption of ASU 2016-02 will have on its consolidated financial statements.

9

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”), which institutes a number of modifications to the reporting of financial assets and liabilities. These modifications include: (i) measurement of non-equity method assets and liabilities at fair value, with changes to fair value recognized through net income, (ii) performance of qualitative impairment assessments of equity investments without readily determinable fair values at each reporting period, (iii) elimination of the requirement to disclose methods and significant assumptions used in calculating the fair value of financial instruments measured at amortized cost, (iv) measurement of the fair value of financial instruments measured at amortized cost using the exit price notion consistent with Topic 820, Fair Value Measurement, (v) separate presentation in other comprehensive income of the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk, (vi) separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and (vii) evaluation of the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. This ASU is effective for financial statements issued with fiscal years beginning after December 15, 2017, including interim periods within that reporting period.  The Company is currently evaluating the impact the adoption of ASU 2016-01 will have on its consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services.  The standard will be effective for us in the first quarter of fiscal 2019.  We have a project plan in place for the transition to revenue recognition in accordance with Topic 606, including necessary changes to accounting processes, procedures and internal controls. Our initial evaluation is that the timing of revenue recognition for our various revenue streams would not be materially impacted by the adoption of this standard.  Thus, we do not expect the adoption of this standard to materially impact our consolidated financial statements, but we are still evaluating the impact on our financial statement disclosures.  As we continue our assessment, we are reviewing selected revenue contracts in detail to validate our initial conclusions. We will adopt using the modified retrospective approach with any cumulative effect recognized in retained earnings on the date of adoption.

2.Accounts Receivable and Allowance for Doubtful Receivables

Accounts receivable are reduced by an allowance for an estimate of amounts that are uncollectible. Substantially all of the Company’s receivables are due from customers in the United States.  The Company extends credit to its customers based upon its evaluation of the following factors: (i) the customer’s financial condition, (ii) the amount of credit the customer requests, and (iii) the customer’s actual payment history (which includes disputed invoice resolution).  The Company does not typically require its customers to post a deposit or supply collateral.  The Company’s allowance for doubtful receivables is based on an analysis that estimates the amount of its total customer receivable balance that is not collectible.  This analysis includes assessing a default probability to customers’ receivable balances, which is influenced by several factors including (i) current market conditions, (ii) periodic review of customer creditworthiness, and (iii) review of customer receivable aging and payment trends.

The Company writes off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance in the period the payment is received. Credit losses from continuing operations have consistently been within management’s expectations.

The following table presents the activity in the Company’s allowance for doubtful receivables (in thousands):

	Three months ended						Nine months ended
	November 30,						November 30,
	2017			2016			2017			2016
Balance at beginning of period	$	1,318		$	1,820		$	1,674		$	2,041
Bad debt expense, net of recoveries		17			15			(231	)		118
Accounts written off		(29	)		(203	)		(137	)		(527	)
Balance at end of period	$	1,306		$	1,632		$	1,306		$	1,632

10

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

3. Inventories

The Company uses the lower of last-in, first-out (“LIFO”) cost or market to value certain of its business forms inventories and the lower of first-in, first-out (“FIFO”) cost or market to value its remaining forms inventories.  The Company regularly reviews inventories on hand, using specific aging categories, and writes down the carrying value of its inventories for excess and potentially obsolete inventories based on historical usage and estimated future usage.  In assessing the ultimate realization of its inventories, the Company is required to make judgments as to future demand requirements.  As actual future demand or market conditions may vary from those projected by the Company, adjustments to inventories may be required.

The following table summarizes the components of inventories at the different stages of production as of the dates indicated (in thousands):

	November 30,		February 28,
	2017		2017
Raw material	$	16,584	$	16,130
Work-in-process		3,336		3,199
Finished goods		7,879		8,636
	$	27,799	$	27,965

4. Acquisitions

On July 7, 2017, the Company acquired the assets of a tag operation located in Ohio, for $1.4 million in cash plus the assumption of certain accrued liabilities.  Management considers this acquisition immaterial.

On January 27, 2017, the Company completed the acquisition of Independent Printing Company, Inc. and its related entities (collectively “Independent”) for $17.7 million in cash consideration, in a stock purchase transaction.  Independent has 4 locations in Wisconsin, with its main facility located in DePere, Wisconsin. The business produces presentation folders, checks, wide format and commercial printing. Independent, which generated approximately $37.0 million in unaudited sales during calendar year 2016, will continue to operate under its respective brand names.  Independent sells mainly through distributors and resellers. The Company will now have 4 folder facilities in Michigan, Kansas, California and Wisconsin, as well as wide format capabilities in Colorado and Wisconsin.

The following is a summary of the final purchase price allocation for Independent (in thousands):

Accounts receivable	$	4,252
Inventories		1,539
Other assets		575
Property, plant & equipment		5,526
Customer lists		3,390
Trademarks		2,408
Goodwill		6,066
Accounts payable and accrued liabilities		(6,079	)
	$	17,677

The results of operations for Independent are included in the Company’s consolidated financial statements from the date of acquisition.  The following table represents certain operating information on a pro forma basis as though all Independent operations had been acquired as of March 1, 2016, after the estimated impact of adjustments such as amortization of intangible assets, interest expense, interest income, and related tax effects (in thousands, except per share amounts):

	Three months ended		Nine months ended
	November 30, 2016		November 30, 2016
Pro forma net sales	$	97,803	$	297,745
Pro forma net earnings		5,990		19,957
Pro forma earnings per share - diluted		0.23		0.77

The pro forma results are not necessarily indicative of what would have occurred if the acquisitions had been in effect for the periods presented.

11

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

5. Discontinued Operations

On May 25, 2016 the Company sold its Apparel Segment to Gildan Activewear Inc. for an all-cash purchase price of $110.0 million, subject to a working capital adjustment, customary indemnification arrangements, and the other terms of the Unit Purchase Agreement dated May 4, 2016.

The operating results of these discontinued operations only reflect revenues and expenses that are directly attributable to the Apparel Segment and that have been eliminated from continuing operations.  The following tables show the key components on the sale and discontinued operations related to the Apparel Segment that was completed on May 25, 2016 (in thousands):

Sales price	$	110,000
Carrying value of disposed		(130,174	)
Expenses related to sales (1)		(4,365	)
Loss on sale before write-off of foreign currency translation    adjustment		(24,539	)
Write-off of foreign currency translation adjustments
recorded in other comprehensive income		(16,109	)
Loss on sale of sale of discontinued operations	$	(40,648	)

(1) Includes the termination fee, in the amount of $3.0 million, paid as a result of the termination of a prior purchase agreement for the sale of the Apparel Segment to Alstyle Operations, LLC.

	Nine months ended
	November 30, 2016
Net sales	$	41,038
Income from discontinued operations before income taxes		3,873
Loss on sale of discontinued operations before income taxes		(40,648	)
Loss on discontinued operations before income taxes		(36,775	)
Income tax benefit		(13,214	)
Net loss from discontinued operations	$	(23,561	)

6. Goodwill and Intangible Assets

Beginning March 1, 2017, given the general declining trend line of print sales, and its expected continuance into the foreseeable future, the Company elected to treat the recorded value of trademarks/trade names as no longer being an indefinite-lived asset. As such, as of March 1, 2017, the Company began amortizing the carrying value of these assets over their estimated remaining useful life, approximately 17 - 19 years.  The amortization expense associated with this election is expected to increase the Company’s selling, general and administrative expense line by approximately $830,000 during fiscal year 2018.

12

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

The carrying amount and accumulated amortization of the Company’s intangible assets at each balance sheet date are as follows (in thousands):

	Weighted
	Average
	Remaining		Gross
	Life		Carrying		Accumulated
As of November 30, 2017	(in years)		Amount		Amortization		Net
Amortized intangible assets
Trademarks and trade names		16.2	$	19,625	$	2,109	$	17,516
Customer lists		8.3		58,040		24,884		33,156
Noncompete		0.1		175		130		45
Patent		0.3		783		754		29
Total		11.0	$	78,623	$	27,877	$	50,746
As of February 28, 2017
Amortized intangible assets
Trademarks and trade names		8.0	$	3,642	$	1,234	$	2,408
Customer lists		8.9		57,347		21,336		36,011
Noncompete		0.8		175		86		89
Patent		1.0		783		655		128
Total		8.8	$	61,947	$	23,311	$	38,636

	November 30,		February 28,
	2017		2017
Non-amortizing intangible assets
Trademarks and trade names	$	—	$	15,291

Aggregate amortization expense for the nine months ended November 30, 2017 and November 30, 2016 was $4.6 million and $3.5 million, respectively.

The Company’s estimated amortization expense for the current and next four fiscal years ending in February of the stated fiscal year is as follows (in thousands):

2018	$	5,992
2019		5,558
2020		5,476
2021		5,406
2022		5,363

Changes in the net carrying amount of goodwill as of the dates indicated are as follows (in thousands):

Balance as of March 1, 2016	$	64,537
Goodwill acquired		6,066
Goodwill impairment		—
Balance as of February 28, 2017		70,603
Goodwill acquired		—
Goodwill impairment		—
Balance as of November 30, 2017	$	70,603

During the fiscal year ended February 28, 2017, $6.1 million was added to goodwill related to the acquisition of Independent.

13

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

7. Other Accrued Expenses

The following table summarizes the components of other accrued expenses as of the dates indicated (in thousands):

	November 30,		February 28,
		2017		2017
Accrued taxes	$	140	$	329
Accrued legal and professional fees		438		414
Accrued interest		134		98
Accrued utilities		111		90
Accrued acquisition related obligations		759		789
Accrued credit card fees		127		119
Other accrued expenses		171		187
	$	1,880	$	2,026

8. Long-Term Debt

Long-term debt consisted of the following as of the dates indicated (in thousands):

	November 30,		February 28,
	2017		2017
Revolving credit facility	$	30,000	$	30,000

The Company has entered into a Second Amended and Restated Credit Agreement, which has been amended from time to time, pursuant to which a credit facility has been extended to the Company (the “Credit Facility”) until August 11, 2020 that provides the Company and its subsidiaries with up to $100.0 million in revolving credit, as well as a $20.0 million sublimit for the issuance of letters of credit and a $15.0 million sublimit for swing-line loans.  Under the Credit Facility, the Company or any of its subsidiaries also can request up to three increases in the aggregate commitments in an aggregate amount not to exceed $50.0 million.  Under the Credit Facility: (i) the Company’s net leverage ratio may not exceed 3.00:1.00, (ii) the Company’s fixed charge coverage ratio may not be less than 1.25:1.00, and (iii) the Company may make dividends or distributions to shareholders so long as (a) no event of default has occurred and is continuing and (b) the Company’s net leverage ratio both before and after giving effect to any such dividend or distribution is equal to or less than 2.50:1.00.  As of November 30, 2017, the Company was in compliance with all terms and conditions of the Credit Facility.

The Credit Facility bears interest at the LIBOR rate plus a spread ranging from 1.0% to 2.0%, which rate was 2.5% (3 month LIBOR + 1.0%) at November 30, 2017 and 1.86% (2 month LIBOR + 1.0%) at February 28, 2017.  The rate is determined by our fixed charge coverage ratio of total funded debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”).  As of November 30, 2017, we had $30.0 million of borrowings under the revolving credit line and $1.2 million outstanding under standby letters of credit arrangements, leaving approximately $68.8 million available in borrowing capacity.  The Credit Facility is secured by substantially all of our assets (other than real property), as well as all capital securities of each of our subsidiaries.

9. Shareholders’ Equity

The Board has authorized the repurchase of up to an aggregate of $40.0 million of the Company’s outstanding common stock through a stock repurchase program.  Under the repurchase program, share purchases may be made from time to time in the open market or through privately negotiated transactions depending on market conditions, share price, trading volume and other factors.  Such purchases, if any, will be made in accordance with applicable insider trading and other securities laws and regulations.  These repurchases may be commenced or suspended at any time or from time to time without prior notice.

During the nine months ended November 30, 2017 the Company, under the program, repurchased 191,033 shares of common stock at an average price of $17.33 per share.  Since the program’s inception in October 2008, there have been 1,442,236 common shares repurchased at an average price of $14.99 per share. As of November 30, 2017 there was $18.4 million available to repurchase shares of the Company’s common stock under the program.  Unrelated to the stock repurchase program, the Company purchased 145 shares of its common stock during the nine months ended November 30, 2017.

14

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

10. Stock Option Plan and Stock Based Compensation

The Company grants stock options and restricted stock to key executives and managerial employees and non-employee directors.  At November 30, 2017, the Company had one stock option plan, the 2004 Long-Term Incentive Plan of Ennis, Inc., as amended and restated as of June 30, 2011, formerly the 1998 Option and Restricted Stock Plan amended and restated as of May 14, 2008 (the “Plan”). The Company has 529,408 shares of unissued common stock reserved under the Plan for issuance as of November 30, 2017.  The exercise price of each stock option granted under the Plan equals a referenced price of the Company’s common stock as reported on the New York Stock Exchange on the date of grant, and an option’s maximum term is ten years. Stock options and restricted stock may be granted at different times during the year and vest ratably over various periods, from grant date up to five years. The Company uses treasury stock to satisfy option exercises and restricted stock awards.

The Company recognizes compensation expense for stock options and restricted stock grants on a straight-line basis over the requisite service period.  For the three months ended November 30, 2017 and November 30, 2016, the Company included compensation expense related to share-based compensation of $0.3 million ($0.2 million net of tax), and $0.3 million ($0.2 million net of tax), respectively, in selling, general, and administrative expenses.  For the nine months ended November 30, 2017 and November 30, 2016, the Company included compensation expense related to share-based compensation of $1.0 million ($0.6 million net of tax), and $1.0 million ($0.6 million net of tax), respectively, in selling, general, and administrative expenses.

Stock Options

The Company had the following stock option activity for the nine months ended November 30, 2017:

					Weighted
			Weighted		Average		Aggregate
	Number		Average		Remaining		Intrinsic
	of Shares		Exercise		Contractual		Value(a)
	(exact quantity)		Price		Life(inyears)		(inthousands)
Outstanding at March 1, 2017		172,496	$	15.95		4.2	$	223
Granted		—		—
Terminated		—		—
Exercised		—		—
Outstanding at November 30, 2017		172,496	$	15.95		3.5	$	896
Exercisable at November 30, 2017		170,880	$	15.97		3.4	$	884

(a) Intrinsic value is measured as the excess of fair market value of the Company’s common stock as reported on the New York Stock Exchange over the applicable exercise price.

No stock options were granted during the nine months ended November 30, 2017 and November 30, 2016.

A summary of the stock options exercised and tax benefits realized from stock based compensation is presented below (in thousands):

	Three months ended				Nine months ended
	November 30,				November 30,
	2017		2016		2017		2016
Total cash received	$	—	$	—	$	—	$	2,910
Income tax benefits		—		—		—		—
Total grant-date fair value		—		—		—		532
Intrinsic value		—		—		—		969

15

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

A summary of the Company’s unvested stock options at November 30, 2017 and the changes during the nine months ended November 30, 2017 are presented below:

				Weighted
				Average
	Number			Grant Date
	of Options			Fair Value
Unvested at March 1, 2017		5,073		$	2.41
New grants		—			—
Vested		(3,457	)		2.48
Forfeited		—			—
Unvested at November 30, 2017		1,616		$	2.24

As of November 30, 2017, there was approximately $0.8 million of unrecognized compensation cost related to unvested stock options granted under the Plan.  The weighted average remaining requisite service period of the unvested stock options was 0.4 years.

Restricted Stock

The Company had the following restricted stock grant activity for the nine months ended November 30, 2017:

				Weighted
				Average
	Number of			Grant Date
	Shares			Fair Value
Outstanding at March 1, 2017		166,546		$	16.35
Granted		74,900			16.30
Terminated		—			—
Vested		(88,105	)		15.91
Outstanding at November 30, 2017		153,341		$	16.58

As of November 30, 2017, the total remaining unrecognized compensation cost related to unvested restricted stock granted under the Plan was approximately $1.8 million.  The weighted average remaining requisite service period of the unvested restricted stock awards was 1.7 years.

11. Pension Plan

The Company and certain subsidiaries have a noncontributory defined benefit retirement plan (the “Pension Plan”), covering approximately 20% of aggregate employees.  Benefits are based on years of service and the employee’s average compensation for the highest five compensation years preceding retirement or termination.

Pension expense is composed of the following components included in cost of goods sold and selling, general, and administrative expenses in the Company’s consolidated statements of earnings (in thousands):

	Three months ended						Nine months ended
	November 30,						November 30,
	2017			2016			2017			2016
Components of net periodic benefit cost
Service cost	$	271		$	292		$	812		$	875
Interest cost		567			593			1,702			1,779
Expected return on plan assets		(948	)		(917	)		(2,845	)		(2,749	)
Amortization of:
Unrecognized net loss		510			671			1,531			2,012
Net periodic benefit cost	$	400		$	639		$	1,200		$	1,917

16

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

The Company is required to make contributions to the Pension Plan.  These contributions are required under the minimum funding requirements of ERISA.  Due to the enactment of the Highway and Transportation Funding Act (HATFA) in August 2014, plan sponsors can calculate the discount rate used to measure the Pension Plan liability using a 25-year average of interest rates plus or minus a corridor.  The Company’s minimum required contribution to the Pension Plan is zero for the Pension Plan year ending February 28, 2018.  However, the Company made a cash contribution to the Pension Plan of$3.0 million on December 28, 2017 for fiscal year 2018.  The Company contributed $3.0 million to the Pension Plan during fiscal year 2017.

12.Earnings (loss) per Share

Basic earnings (loss) per share have been computed by dividing net earnings by the weighted average number of common shares outstanding during the applicable period.  Diluted earnings (loss) per share reflect the potential dilution that could occur if stock options or other contracts to issue common shares were exercised or converted into common stock.

For the three months ended November 30, 2017, all options were included in the diluted earnings per share computation because the average fair market value of the Company’s stock exceeded the exercise price of the options.For the nine months ended November 30, 2017, 42,500 sharesrelated to stock options were not included in the diluted earnings per share computation because the exercise price exceeded the average fair market value of the Company’s stock.  For the three and nine months ended November 30, 2016, 95,692 and 42,500 shares related to stock options were not included in the diluted earnings per share computation because the exercise price exceeded the average fair market value of the Company’s stock.  The following table sets forth the computation for basic and diluted earnings (loss) per share for the periods indicated:

	Three months ended				Nine months ended
	November 30,				November 30,
	2017		2016		2017		2016
Basic weighted average common shares outstanding		25,360,452		25,673,824		25,387,389		25,802,658
Effect of dilutive options		33,030		9,789		21,870		15,488
Diluted weighted average common shares outstanding		25,393,482		25,683,613		25,409,259		25,818,146
Earnings (loss) per share - basic and diluted
Earnings per share on continuing operations	$	0.33	$	0.22	$	0.97	$	0.74
Earnings per share on discontinued operations		—		—		—		0.10
Loss per share on sale of discontinued operations		—		—		—		(1.01	)
Loss on discontinued operations		—		—		—		(0.91	)
Net earnings (loss)	$	0.33	$	0.22	$	0.97	$	(0.17	)
Cash dividends	$	0.200	$	0.175	$	0.575	$	2.025

17

ENNIS, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE PERIOD ENDED NOVEMBER 30, 2017

13. Concentrations of Risk

Financial instruments that potentially subject the Company to a concentration of credit risk principally consist of cash and trade receivables. Cash is placed with high-credit quality financial institutions. The Company believes its credit risk with respect to trade receivables is limited due to industry and geographic diversification. As disclosed on the Consolidated Balance Sheets, the Company maintains an allowance for doubtful receivables to cover the Company’s estimate of credit losses associated with accounts receivable.

The Company, for quality and pricing reasons, purchases its paper products from a limited number of suppliers.  While other sources may be available to the Company to purchase these products, they may not be available at the cost or at the quality the Company has come to expect.

For the purposes of the Consolidated Statements of Cash Flows, the Company considers cash to include cash on hand and in bank accounts.  The Federal Deposit Insurance Corporation insures accounts up to $250,000.  At November 30, 2017, cash balances included $92.0 million that was not federally insured because it represented amounts in individual accounts above the federally insured limit for each such account.  This at-risk amount is subject to fluctuation on a daily basis.  While management does not believe there is significant risk with respect to such deposits, we cannot be assured that we will not experience losses on our deposits.

14. Subsequent Events

On December 21, 2017, the Board declared a quarterly cash dividend of 20 cents per share, which will be paid on February 9, 2018 to the shareholders of record on January 12, 2018.

The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017 and is effective for tax years beginning after December 31, 2017.  The Company is currently evaluating the impact of the Act on the consolidated financial statements.  Management expects the Company’s effective tax rate and net deferred tax liabilities to decrease as a result of the reduction of the corporate tax rate from 35% to 21%, which will be partially offset by the elimination or reduction of certain tax deductions.

In conjunction with the signing of the Act, the Ennis Board of Directors approved a special one-time bonus to more than 2,200 non-management employees in the amount of $500 each.  This payment will take place with the first payroll period in January 2018.

In addition, in response to the Act, the Board of Directors declared a special one-time cash dividend of 10 cents per share of our common stock.  The dividend will be paid on February 9, 2018 to the shareholders of record on January 12, 2018.

18

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDRESULTS OF OPERATIONS

Overview

Ennis, Inc. (formerly Ennis Business Forms, Inc.) (“we” or the “Company”) was organized under the laws of Texas in 1909. The Company and its subsidiaries print and manufacture a broad line of business forms and other business products.  We distribute business products and forms throughout the United States primarily through independent dealers.  This distributor channel encompasses independent print distributors, commercial printers, direct mail, fulfillment companies, payroll and accounts payable software companies, and advertising agencies, among others.  We also sell products to many of our competitors to satisfy their customers’ needs.

On January 27, 2017, we completed the acquisition of Independent Printing Company, Inc. and its related entities (collectively “Independent”) for $17.7 million in cash consideration, in a stock purchase transaction.  Independent has 4 locations in Wisconsin, with its main facility located in DePere, Wisconsin. The business produces presentation folders, checks, wide format and commercial printing. Independent, which generated approximately $37.0 million in unaudited sales during calendar year 2016, will continue to operate under its brand names.  Independent sells mainly through distributors and resellers. With this acquisition, we now have 4 folder facilities located in Michigan, Kansas, California and Wisconsin, as well as wide format capabilities in Colorado and Wisconsin.

On May 25, 2016 the Company sold its apparel operations conducted by Alstyle Apparel, LLC and its subsidiaries (the “Apparel Segment”) to Gildan Activewear Inc. for an all-cash purchase price of $110.0 million, subject to a working capital adjustment, customary indemnification arrangements, and the other terms of the Unit Purchase Agreement dated May 4, 2016.

During the fourth quarter of fiscal year 2016, we moved our folder operations from Omaha, Nebraska to Columbus, Kansas, due to the landlord’s desire to sell the facility.  The move and inefficiencies associated with starting-up and training new employees had a negative impact on revenues and operational margins over the first half of fiscal year 2017.  However, during the second half of fiscal year 2017 we saw a turnaround and the operations were marginally profitable.  We have continued to see this momentum carry over into this fiscal year.  In addition, our medical claims during fiscal year 2017 exceeded historical levels, which resulted in us incurring an additional $4.3 million in increased medical charges that had a negative impact on our earnings.  To mitigate further medical charges, we implemented a new cost reimbursement program, as well as other changes to our health plan, as of the start of the calendar year 2017.  Initial indications through the current fiscal year have been positive.  While we are still in the early stages of this program and actual cost savings may vary from anticipated levels, we continue to believe that our future medical claims expenses will trend more in line with historical levels.

Business Overview

Our management believes we are the largest provider of business forms, pressure-seal forms, labels, tags, envelopes, and presentation folders to independent distributors in the United States.

We are in the business of manufacturing, designing, and selling business forms and other printed business products primarily to distributors located in the United States. We operate 59 manufacturing plants throughout the United States in 21 strategically located states. Approximately 95% of the business products manufactured 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®, Ad Concepts^SM, FormSource Limited^SM, Star Award Ribbon Company®, 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, TRI-C Business Forms^SM, Major Business Systems^SM, Independent Printing^SM, and Hoosier Data Forms®. We also sell 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®, Folder Express®, and Independent Folders® brands (which provide presentation folders and document folders); Ennis Tag & Label^SM (which provides custom printed, high performance labels and custom and stock tags); Atlas Tag & Label®, Kay Toledo Tag®, and Special Service Partners® (SSP) (which provides custom and stock tags and labels); Trade Envelopes®, 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).

19

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

We sell predominantly through private printers and independent distributors, as well as to many of our competitors. Northstar Computer Forms, Inc., a wholly-owned subsidiary, also sells direct to a small number of customers, generally large banking organizations (where a distributor is not acceptable or available to the end-user).  Adams McClure, LP, a wholly-owned subsidiary, also sells direct to a small number of customers, where sales are generally through advertising agencies.

The printing industry generally sells its products either through sales made predominantly to end users, a market dominated by a few large manufacturers, such as R.R. Donnelley and Sons, Staples, Inc., Standard Register Co. (a subsidiary of Taylor Corporation), and Cenveo, Inc., or, like the Company, through a variety of independent distributors and distributor groups. While it is not possible, because of the lack of adequate public statistical information, to determine the Company’s share of the total business products market, management believes the Company is the largest producer of business forms, pressure-seal forms, labels, tags, envelopes, and presentation folders in the United States distributing primarily through independent dealers.

There are a number of competitors that operate in this segment, ranging in size from single employee-owned operations to multi-plant organizations. We believe our strategic locations and buying power permit us to compete on a favorable basis within the distributor market on competitive factors, such as service, quality, and price.

Distribution of business forms and other business products throughout the United States is primarily done through independent dealers, including business forms distributors, resellers, direct mail, commercial printers, payroll and accounts payable software companies, and advertising agencies.

Raw materials principally consist of a wide variety of weights, widths, colors, sizes, and qualities of paper for business products purchased from generally one major supplier at favorable prices based on the volume of business.

Business products usage in the printing industry is generally not seasonal. General economic conditions and contraction of the traditional business forms industry are the predominant factors in quarterly volume fluctuations.

Business Challenges

We are engaged in an industry undergoing significant changes, including consolidation of some of our traditional channels, product obsolescence, and expansion of commodity materials to our competition, as well as cheaper material imports due to the strong dollar.  Technology advances have made electronic distribution of documents, internet hosting, digital printing and print-on-demand valid, cost-effective alternatives to traditional custom-printed documents and customer communications.  Improved equipment has become more accessible to our competitors due to the continued low interest rate environment.  We face highly competitive conditions throughout the supply chain in an already over-supplied, price-competitive print industry.  The challenges of our business include the following:

Transformation of our portfolio of products – While traditional business documents are essential in order to conduct business, many are being replaced through the use of cheaper paper grades or imported paper, or devalued with advances in digital technologies, causing steady declines in demand for a portion of our current product line.  Transforming our product offerings in order to continue to provide innovative, valuable solutions through lower labor and fixed charges to our customers on a proactive basis will require us to make investments in new and existing technology and to develop key strategic business relationships, such as print-on-demand services and product offerings that assist customers in their transition to digital business environments.  In addition, we will continue to look for new market opportunities and niches through acquisitions, such as the addition of our envelope offerings, tag offerings, folder offerings, healthcare wristbands, secure document solutions, innovative in-mold label offerings and long-run integrated products with high color web printing, which provide us with an opportunity for growth and differentiate us from our competition.

Production capacity and price competition within our industry – Due to the number of paper mills worldwide, some paper pricing has been and is expected to remain fairly weak. The strong dollar during the first half of the year attracted cheaper material into the United States notwithstanding the trade tariffs imposed, which has impaired the price advantage larger suppliers have held over smaller competitors and helped to maintain pricing.  However, with the subsequent weakening of the dollar, the price advantage of foreign imports has for the most part dissipated and resulted in lower volumes of imported paper.  This, with the shrinking of some domestic mill capacity, has allowed domestic producers to announce price increases across all paper grades. Even with the shrinking of domestic capacity and lower imports, most reports still indicate there to be an imbalance in the domestic marketplace for most grades due to lower demand.  Therefore, it is too early to tell whether or not these announced price increases will truly stick and have to be passed on to the marketplace.  In the past, the Company has been fairly successful in passing increases through to the marketplace over time.  We will continue to focus our efforts on effectively managing and controlling our product costs to minimize these effects on our operational results, primarily through the use of forecasting, production and costing models, as well as working

20

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

closely with our domestic suppliers to reduce our procurement costs.  We will continue to look for ways to reduce as well as leverage our fixed costs.  As always, some of these negative factors are cyclical and we will continue to focus on maintaining our margins when these negative factors swing the other way.

Continued consolidation of our customers – Our customers, who are distributors, are consolidating or are being acquired by competitors.  As such, they demand better pricing and services, or they are required to relocate their business to their new parent company’s manufacturing facilities.  While we continue to maintain a majority of this business, it is possible that these consolidations and acquisitions will impact our margins and our sales.

Cautionary Statements Regarding Forward Looking Statements

You should read this discussion and analysis in conjunction with our Consolidated Financial Statements and the related notes appearing elsewhere in this Report. All of the statements in this Report, other than historical facts, are forward-looking statements, including, without limitation, the statements made in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” particularly under the caption “Overview.”  As a general matter, forward-looking statements are those focused upon anticipated events or trends, expectations, and beliefs relating to matters that are not historical in nature.  The words “could,” “should,” “feel,” “anticipate,” “aim,” “preliminary,” “expect,” “believe,” “estimate,” “intend,” “intent,” “plan,” “will,” “foresee,” “project,” “ forecast,” or the negative thereof or variations thereon, and similar expressions identify forward-looking statements.

The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for these forward-looking statements.  In order to comply with the terms of the safe harbor, the Company notes that forward-looking statements are subject to known and unknown risks, uncertainties and other factors relating to its operations and business environment, all of which are difficult to predict and many of which are beyond the control of the Company.  These known and unknown risks, uncertainties and other factors could cause actual results to differ materially from those matters expressed in, anticipated by or implied by such forward-looking statements.

These statements reflect the current views and assumptions of management with respect to future events.  The Company does not undertake, and hereby disclaims, any duty to update these forward-looking statements, even though its situation and circumstances may change in the future.  Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this report.  The inclusion of any statement in this report does not constitute an admission by the Company or any other person that the events or circumstances described in such statement are material.

We believe these forward-looking statements are based upon reasonable assumptions.  All such statements involve risks and uncertainties, and as a result, actual results could differ materially from those projected, anticipated or implied by these statements. Such forward-looking statements involve known and unknown risks, including but not limited to, general economic, business and labor conditions and the potential impact on our operations; our ability to implement our strategic initiatives and control our operational costs; dependence on a limited number of key suppliers; our ability to recover the rising cost of raw materials and other costs (i.e., energy, freight, labor, benefit costs, etc.) in markets that are highly price competitive and volatile;  our ability to timely or adequately respond to technological changes in the industry; the impact of the Internet and other electronic media on the demand for forms and printed materials; the impact of foreign competition; changes in economic conditions; customer credit risk; competitors’ pricing strategies; a decline in business volume and profitability could result in an impairment in our reported goodwill negatively impacting our operational results; our ability to retain key management personnel; our ability to identify, manage or integrate acquisitions; and changes in government regulations.  In addition to the factors indicated above, you should carefully consider the risks described in and incorporated by reference herein and in the risk factors in our Annual Report on Form 10-K for the fiscal year ended February 28, 2017 before making an investment in our common stock.

Critical Accounting Policies and Estimates

In preparing our consolidated financial statements, we are required to make estimates and assumptions that affect the disclosures and reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. We evaluate our estimates and judgments on an ongoing basis, including those related to allowance for doubtful receivables, inventory valuations, property, plant and equipment, intangible assets, pension plan obligations, accrued liabilities and income taxes. We base our estimates and judgments on historical experience and on various other factors that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We believe our accounting policies related to the aforementioned items are the most critical due to their effect on our more significant estimates and judgments used in preparation of our consolidated financial statements.  For additional information, reference is made to the Critical Accounting Policies and Estimates section of our Annual Report on Form 10-K for the fiscal year ended February 28, 2017.

21

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

Results of Operations

The discussion that follows provides information which we believe is relevant to an understanding of our results of operations and financial condition.  The discussion and analysis should be read in conjunction with the accompanying consolidated financial statements and notes thereto, which are incorporated herein by reference. Unless otherwise indicated, this financial overview is for the continuing operations of the Company, which are comprised of the production and sales of business forms and other business products, and exclude the discontinued operations of the Apparel Segment.  The operating results of the Company for the three and nine months ended November 30, 2017 and the comparative periods for 2016 are set forth in the unaudited consolidated financial information included in the tables below.

Consolidated Summary

Unaudited Consolidated Statements of	Three Months Ended November 30,											Nine Months Ended November 30,
Operations - Data (Dollars in thousands, except per share amounts)	2017						2016					2017					2016
Net sales	$	93,606			100.0	%	$	88,660		100.0	%	$	283,083		100.0	%	$	270,316		100.0	%
Cost of goods sold		63,722			68.1			63,368		71.5			192,493		68.0			191,292		70.8
Gross profit margin		29,884			31.9			25,292		28.5			90,590		32.0			79,024		29.2
Selling, general and administrative		16,699			17.8			15,833		17.8			51,167		18.1			47,961		17.7
(Gain) loss from disposal of assets		(4	)	—				264		0.3			59		—			266		0.1
Income from operations		13,189			14.1			9,195		10.4			39,364		13.9			30,797		11.4
Other expense, net		(55	)		(0.1	)		(84	)	(0.1	)		(319	)	(0.1	)		(313	)	(0.1	)
Earnings from continuing operations    before income taxes		13,134			14.0			9,111		10.3			39,045		13.8			30,484		11.3
Provision for income taxes		4,860			5.2			3,371		3.8			14,447		5.1			11,277		4.2
Earnings from continuing operations		8,274			8.8	%		5,740		6.5	%		24,598		8.7	%		19,207		7.1	%
Income from discontinued operations, net    of tax		—			—			—		—			—		—			2,481		0.9
Loss on sale of discontinued operations,    net of tax		—			—			—		—			—		—			(26,042	)	(9.6	)
Earnings (loss) from discontinued    operations, net of tax		—			—			—		—			—		—			(23,561	)	(8.7	)
Net earnings (loss)	$	8,274			8.8	%	$	5,740		6.5	%	$	24,598		8.7	%	$	(4,354	)	-1.6	%
Earnings (loss) per share - diluted
Continuing operations	$	0.33					$	0.22				$	0.97				$	0.74
Discontinued operations		—					—						—					0.10
		0.33						0.22					0.97					0.84
Sale of discontinued operations		—						—					—					(1.01	)
Net earnings (loss)	$	0.33					$	0.22				$	0.97				$	(0.17	)

Three months ended November 30, 2017 compared to three months ended November 30, 2016

Net Sales.  Our net sales were $93.6 million for the quarter ended November 30, 2017, compared to $88.7 million for the same quarter last year, or an increase of $4.9 million, or 5.5%.  The market continues to be fairly soft with competitive pricing pressures.  However, the current reversal of some of the dollar’s strength has made domestic paper production more attractive.  This factor, along with the shrinking of some domestic mill capacity, has resulted in the announcement of some recent paper price increases.  It is still too early to tell whether or not these will stick and be passed through to the marketplace.  If so, this may offset some of the normal industry sales attrition expected in the marketplace.   The acquisition of Independent, which was completed in January 2017 and which is an integral part of our strategy to offset normal industry revenue declines due to print attrition and other changes, contributed $9.8 million in net sales during the three months ended November 30, 2017.

22

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

Cost of Goods Sold.  Our cost of goods sold increased slightly by $0.3million from $63.4 million for the three months ended November 30, 2016 to $63.7 million for the three months ended November 30, 2017, or 0.5%. Our gross profit margin (“margin”) was $29.9million for the quarter, or 31.9% of net sales, compared to $25.3 million, or 28.5% of net sales, for the same quarter last year.  During the third quarter of fiscal 2017 our margin was negatively impacted by increased medical expenses of approximately $1.4 million.

Selling, general, and administrative expense.  For the three months ended November 30, 2017, our selling, general, and administrative (“SG&A”) expenses were $16.7 million compared to $15.8 million for the three months ended November 30, 2016, or an increase of 5.7%.  As a percentage of net sales, the SG&A expenses were 17.8% and 17.8% for the three months ended November 30, 2017 and November 30, 2016, respectively.  The acquisition of Independent added $2.0 million in SG&A expenses during the quarter, or 20.2% of its respective net sales.  As we continue to integrate this acquisition into our culture and systems, we will continue to look for ways to reduce these expenses to be more in line with our historical SG&A percentage.  In addition to the foregoing, the Company changed its accounting practice for handling its trademarks/trade names from an indefinite life to a finite life method.  This change in accounting method added approximately $0.2 million to SG&A expense during the current quarter.

(Gain) loss from disposal of assets.  The $4,000 net gain from disposal of assets during the quarter related primarily to the sale of manufacturing equipment.  The $0.3 million net loss during the same quarter last year related primarily to the $0.5 million loss on the sale of an unused manufacturing facility and its associated property offset by a $0.2 million gain on the sale a second unused manufacturing facility and equipment.

Income from operations.  As a result of the above factors, our income from operations for the three months ended November 30, 2017 was $13.2 million, or 14.1% of net sales, as compared to $9.2 million, or 10.4% of net sales, for the three months ended November 30, 2016.  The acquisition of Independent contributed approximately $1.3 million of income during the third quarter of this fiscal year.

Other expense.  Other expense was $0.1 million for the three months ended November 30, 2017 and November 30, 2016.

Provision for income taxes. Our effective tax rate for operations was 37.0% for the three months ended November 30, 2017 and November 30, 2016.

Net earnings.  Earnings from operations were $8.3 million for the three months ended November 30, 2017 as compared to $5.7 million for the comparable quarter last year, an increase of 45.6%.  Earnings from operations per diluted share for the three months ended November 30, 2017 was $0.33, compared to $0.22 for the same quarter last year.  There were no discontinued operations during the three months ended November 30, 2017 and November 30, 2016.

Nine months ended November 30, 2017 compared to nine months ended November 30, 2016

Net Sales.  Our net sales were $283.1 million for the nine month period ended November 30, 2017, compared to $270.3 million for same period last year, or an increase of 4.7%.  The market continues to be fairly soft with competitive pricing pressures which intensified with the influx of cheaper off-shore paper coming into the United States during the first half of the year. However, the current reversal of some of the dollar’s strength has made domestic paper production more attractive.  This, with the shrinking of some domestic mill capacity, has resulted in the announcement of some recent paper price increases.  It is still too early to tell whether or not these announced increases will stick and be passed through to the marketplace.  If so, this may offset some of the normal industry sales attrition expected in the marketplace.  The acquisition of Independent in January of 2017, which is an integral part of our strategy to offset normal industry revenue declines, contributed $29.9 million in net sales during the nine months ended November 30, 2017.

Cost of Goods Sold.  Our cost of goods sold was $192.5 million for the nine months ended November 30, 2017, compared to $191.3 million for the same period last year, a slight increase of $1.2 million, or 0.6%. Our margin was $90.6 million for the nine month period ended November 30, 2017, or 32.0% of net sales, compared to $79.0 million, or 29.2% of net sales, for the same nine month period last year.  For the same nine month period last year, our margin was negatively impacted by the costs associated with the move of our folder operations in Nebraska to Kansas.  The start-up training process for the labor force decreased efficiencies, thereby decreasing our sales and negatively impacting our margins for the nine months ended November 30, 2016 by an estimated $3.0 million for the period.  In addition, we incurred additional medical expenses due to our medical claims exceeding our historical levels during our second and third quarters; this impacted our margin for the nine months ended November 30, 2016 by approximately $2.9 million.

23

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

Selling, general, and administrative expense.  Our SG&A expenses were $51.2 million for the nine months ended November 30, 2017, compared to $48.0 million for the same period last year, or an increase of 6.7%.  As a percentage of net sales, the SG&A expenses were 18.1% and 17.7% for the nine months ended November 30, 2017 andNovember 30, 2016, respectively.  The acquisition of Independent added $6.3 million in SG&A expenses during the nine month period ended November 30, 2017, or 21.2% of its respective net sales.  As we continue to integrate this acquisition into our culture and systems, we will continue to look for ways to reduce these expenses to be more in line with our historical SG&A percentage.  In addition to the foregoing, the Company changed its accounting practice for handling its trademarks/trade names from an indefinite life to a finite life method.  This change in accounting method added approximately $0.6 million to SG&A expense during the nine month period ended November 30, 2017.

Loss from disposal of assets.  The $59,000 net loss from disposal of assets during the nine months ended November 30, 2017 related primarily to the sale of manufacturing equipment.  The $0.3 million net loss from disposal of assets during the nine months ended November 30, 2016 resulted primarily from the $0.5 million loss on the sale of an unused manufacturing facility and its associated property offset by a $0.2 million gain from the sale of a second unused manufacturing facility and equipment.

Income from operations.  Our income from continuing operations for the nine months ended November 30, 2017 was $39.4 million, or 13.9% of net sales, as compared to $30.8 million, or 11.4% of net sales, for the nine months ended November 30, 2016.  The acquisition of Independent contributed approximately $4.2 million of income during the current nine month period.

Other expense.  Other expense was $0.3 million for the nine months ended November 30, 2017 and November 30, 2016.

Provision for income taxes. Our effective tax rate for continuing operations was 37.0% for both the nine months ended November 30, 2017 and the nine months ended November 30, 2016.

Net earnings (loss).  Earnings from continuing operations were $24.6 million for the nine months ended November 30, 2017 as compared to $19.2 million for the comparable period last year, an increase of $5.4 million.  Earnings from continuing operations per diluted share for the nine months ended November 30, 2017 was $0.97, compared to $0.74 for the same nine month period last year.  There were no discontinued operations during the nine months ended November 30, 2017, compared to a net loss from discontinued operations of ($0.91) per diluted share in the same nine month period last year.  Overall, the Company realized a net profit of $0.97 per diluted share for the nine months ended November 30, 2017 compared to a net loss of ($0.17) per diluted share for the nine months ended November 30, 2016.

Liquidity and Capital Resources

We rely on our cash flows generated from operations and the borrowing capacity under our Credit Facility to meet cash requirements of our business.  The primary cash requirements of our business are payments to vendors in the normal course of business, capital expenditures, debt repayments and related interest payments, contributions to our pension plan and the payment of dividends to our shareholders.  We expect to generate sufficient cash flows from operations supplemented by our Credit Facility as required to cover our operating and capital requirements for the foreseeable future.

	November 30,		February 28,
(Dollars in thousands)	2017		2017
Working Capital	$	135,574	$	119,282
Cash and cash equivalents	$	92,930	$	80,466

Working Capital.  Our working capital increased $16.3 million or 13.7%, from $119.3 million at February 28, 2017 to $135.6 million at November 30, 2017.  Our working capital was impacted primarily by an increase in our cash of $12.5 million, an increase in our receivables of $1.0 million and a reduction of our current liabilities of approximately $3.0 million. Our current ratio, calculated by dividing our current assets by our current liabilities, increased from 5.0 to 1.0 at February 28, 2017 to 6.0 to 1.0 at November 30, 2017.

	Nine months ended November 30,
(Dollars in thousands)	2017			2016
Net cash provided by operating activities	$	33,818		$	42,560
Net cash provided by (used in) investing activities	$	(3,406	)	$	104,919
Net cash used in financing activities	$	(17,948	)	$	(67,571	)

24

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

Cash flows from operating activities.  Cash provided by operating activities decreased by $8.7 million from $42.6 million for the nine months ended November 30, 2016 to $33.8 million for the nine months ended November 30, 2017.  Our decreased operational cash flows in comparison to the comparable period last year was primarily the result of four factors: (i) a decrease in operating cash flows from the recognition of a pre-tax loss of $36.8 million of our former Apparel Segment that was sold in the first quarter of last fiscal year, (ii) increased earnings of $29.0 million, (iii) an increase of $1.7 million in our prepaid expenses and income taxes, and (iv) a decrease in our receivables by $2.2 million.

Cash flows from investing activities. Cash provided by (used in) investing activities decreased $108.3 million from $104.9 million provided to $3.4 million used for the nine months ended November 30, 2016 and November 30, 2017, respectively.  This was primarily due to the net proceeds of $107.4 million from the sale of the Apparel Segment which took place on May 25, 2016, offset by $0.4 million more in cash used for the acquisition of businesses.  In addition, during the nine months ended November 30, 2017 we used $2.1 million in cash on capital expenditures, compared to $1.9 million during the same period last year.

Cash flows from financing activities.  We used $49.6 million less in cash from financing activities this period than during the same period last year.  We used $10.0 million in cash during the comparable period last year to pay down our debt, compared to no repayment of debt in this period.  We used $52.7 million last year to pay dividends which included a special one-time dividend of $1.50 per share that was paid as a result of the sale of the Apparel Segment, whereas we used $14.6 million to pay dividends this year.  We used $3.3 million to repurchase our common stock under our stock repurchase program during the nine months ended November 30, 2017, whereas we used $7.8 million to repurchase shares of our common stock during the nine months ended November 30, 2016.  In addition, we received $2.9 million from the exercise of stock options in the comparable period last year, whereas in this period no stock options were exercised.

Credit Facility.  The Company’s Credit Facility, extended to the Company until August 11, 2020, provides the Company and its subsidiaries with up to $100.0 million in revolving credit, as well as a $20.0 million sublimit for the issuance of letters of credit and a $15.0 million sublimit for swing-line loans.  Under the Credit Facility, the Company or any of its subsidiaries also can request up to three increases in the aggregate commitments in an aggregate amount not to exceed $50.0 million.  The terms and conditions of the Credit Facility impose certain restrictions on our ability to incur additional debt, make capital expenditures, acquisitions and asset dispositions, as well as impose other customary covenants, such as requiring that our fixed charge coverage ratio not be less than 1.25:1.00 and our total leverage ratio not exceed 3.00:1.00.  The Company may make dividends or distributions to shareholders so long as (a) no event of default has occurred and is continuing and (b) the Company’s net leverage ratio both before and after giving effect to any such dividend or distribution is equal to or less than 2.50:1.00.

The Credit Facility bears interest at the LIBOR rate plus a spread ranging from 1.0% to 2.0%, which rate was 2.5% (3 month LIBOR + 1.0%) at November 30, 2017 and 1.86% (2 month LIBOR + 1.0%) at February 28, 2017.  The rate is determined by our fixed charge coverage ratio of total funded debt to EBITDA.  As of November 30, 2017, we had $30.0 million of borrowings under the revolving credit line and $1.2 million outstanding under standby letters of credit arrangements, leaving approximately $68.8 million available in borrowing capacity.  The Credit Facility is secured by substantially all of our assets (other than real property), as well as all capital securities of each of our subsidiaries.

It is anticipated that the available line of credit is sufficient to cover the Company’s working capital requirements for the foreseeable future, should it be required.

Pension Plan – We are required to make contributions to our Pension Plan.  These contributions are required under the minimum funding requirements of the Employee Retirement Income Security Act of 1974 (“ERISA”).  Due to the enactment of the Highway and Transportation Funding Act (HATFA) in August 2014, which effectively raises the discount rates mandated for determining the value of a plan’s benefit liability and annual cost of accruals, our minimum required contribution to the Pension Plan is zero for the Pension Plan year ending February 28, 2018. However, we made a cash contribution to the Pension Plan of $3.0 million on December 28, 2017 for fiscal year 2018.  We made contributions totaling $3.0 million to our Pension Plan during fiscal 2017. As our Pension Plan assets are invested in marketable securities, fluctuations in market values could potentially impact our funding status, associated liabilities recorded and future required minimum contributions.  At November 30, 2017, we had an unfunded pension liability recorded on our balance sheet of $4.8 million.

Inventories – We believe our inventory levels are sufficient to satisfy our customer demands and we anticipate having adequate sources of raw materials to meet future business requirements. We have long-term contracts in effect with paper suppliers that govern prices, but do not require minimum purchase commitments.  Certain of our rebate programs do, however, require minimum purchase volumes.  Management anticipates meeting the required volumes.

25

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

Capital Expenditures – We expect our capital requirements for our current fiscal year, exclusive of capital required for possible acquisitions, will be within our historical levels of between $3.0 million and $5.0 million.  To date we have spent approximately $2.1 million on capital expenditures.  We expect to fund these expenditures through existing cash flows.

Contractual Obligations & Off-Balance Sheet Arrangements – There have been no significant changes in our contractual obligations since February 28, 2017 that have, or are reasonably likely to have, a material impact on our results of operations or financial condition.  We had no off-balance sheet arrangements in place as of November 30, 2017.

Item 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Market Risk

Interest Rates

We are exposed to interest rate risk on short-term and long-term financial instruments carrying variable interest rates.  We may from time to time utilize interest rate swaps to manage overall borrowing costs and reduce exposure to adverse fluctuations in interest rates.  We do not use derivative instruments for trading purposes.  Our variable rate financial instruments, consisting of the outstanding loans under the Credit Facility, totaled $30.0 million at November 30, 2017.  The annual impact on our results of operations of a one-point interest rate change on the outstanding balance of the variable rate financial instruments as of November 30, 2017 would be approximately $0.3 million.

This market risk discussion contains forward-looking statements.  Actual results may differ materially from this discussion based upon general market conditions and changes in domestic and global financial markets.

Item 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. A review and evaluation were carried out under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our “disclosure controls and procedures” (as such term is defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this Quarterly Report on Form 10-Q, pursuant to Exchange Act Rules 13a-15 and 15d-15. Based upon that review and evaluation, the Chief Executive Officer and the Chief Financial Officer have concluded that our disclosure controls and procedures as of November 30, 2017 are effective to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and include controls and procedures designed to ensure that information required to be disclosed by us in such reports is accumulated and communicated to our management, including our principal executive and financial officers as appropriate to allow timely decisions regarding required disclosure. Due to the inherent limitations of control systems, not all misstatements may be detected. Those inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Additionally, controls could be circumvented by the individual acts of some persons or by collusion of two or more people. Our controls and procedures can only provide reasonable, not absolute, assurance that the above objectives have been met.

There were no changes in our internal control over financial reporting identified in connection with the evaluation required by paragraph (d) of Exchange Act Rule 13a-15 that occurred during our fiscal quarter ended November 30, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

26

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

There are no material pending proceedings, other than ordinary routine litigation incidental to the business, to which the Company or any of its subsidiaries is a party or of which any of their property is subject.

Item 1A. Risk Factors

There have been no material changes in our Risk Factors as previously discussed in our Annual Report on Form 10-K for the year ended February 28, 2017.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

In the 2016 calendar year, the Board authorized the repurchase of up to an aggregate of $40.0 million of the Company’s stock through the Company’s stock repurchase program.  Under the repurchase program, share purchases may be made from time to time in the open market or through privately negotiated transactions depending on market conditions, share price, trading volume and other factors.  Such purchases, if any, will be made in accordance with applicable insider trading and other securities laws and regulations.  These repurchases may be commenced or suspended at any time or from time to time without prior notice.

During the nine months ended November 30, 2017, the Company, under the program, repurchased 191,033 shares of common stock at an average price of $17.33 per share.  Since the program’s inception in October 2008, there have been 1,442,236 common shares repurchased at an average price of $14.99 per share. As of November 30, 2017 there was $18.4 million available to repurchase shares of the Company’s common stock under the program. Unrelated to the stock repurchase program, the Company purchased 145 shares of its common stock during the nine months ended November 30, 2017.

					Total Number
	Total				of Shares		Maximum Amount
	Number		Average		Purchased as		that May Yet Be Used
	of Shares		Price Paid		Part of Publicly		to Purchase Shares
Period	Purchased		per Share		Announced Programs		Under the Program
September 1, 2017 - September 30, 2017		—	$	—		—	$	18,377,146
October 1, 2017 - October 31, 2017		145	$	20.30		—	$	18,377,146
November 1, 2017 - November 30, 2017		—	$	—		—	$	18,377,146
Total		145	$	20.30		—	$	18,377,146

Items 3, 4 and 5 are not applicable and have been omitted

27

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

Item 6. Exhibits

The following exhibits are filed as part of this report.

Exhibit Number	Description
Exhibit 3.1(a)	Restated Articles of Incorporation, as amended through June 23, 1983 with attached amendments dated June 20, 1985, July 31, 1985, June 16, 1988 and November 4, 1998, incorporated herein by reference to Exhibit 3.1(a) to the Registrant’s Form 10-Q filed on October 6, 2017 (File No. 001-05807).
Exhibit 3.1(b)	Amendment to Articles of Incorporation, dated June 17, 2004, incorporated herein by reference to Exhibit 3.1(b) to the Registrant’s Annual Report on Form 10-K for the fiscal year ended February 28, 2007 filed on May 9, 2007 (File No. 001-05807).
Exhibit 3.2	Fourth Amended and Restated Bylaws of Ennis, Inc., dated July 10, 2017, incorporated herein by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on July 10, 2017 (File No. 001-05807).
Exhibit 31.1	Certification Pursuant to Rule 13a-14(a) of Chief Executive Officer.*
Exhibit 31.2	Certification Pursuant to Rule 13a-14(a) of Chief Financial Officer.*
Exhibit 32.1	Section 1350 Certification of Chief Executive Officer.**
Exhibit 32.2	Section 1350 Certification of Chief Financial Officer.**
Exhibit 101	The following information from Ennis, Inc.’s Quarterly Report on Form 10-Q for the quarter ended November 30, 2017, filed on January 5, 2018, formatted in XBRL:  (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Changes in Shareholders’ Equity, (v) Consolidated Statements of Cash Flows, and (vi) the Notes to Consolidated Financial Statements, tagged as blocks of text and in detail.*

* Filed herewith

** Furnished herewith

28

ENNIS, INC. AND SUBSIDIARIES

FORM 10-Q

FOR THE PERIOD ENDED NOVEMBER 30, 2017

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 thereunto duly authorized.

	ENNIS, INC.
Date: January 5, 2018	/s/ Keith S. Walters
	Keith S. Walters
	Chairman, Chief Executive Officer and President
Date: January 5, 2018	/s/ Richard L. Travis, Jr.
	Richard L. Travis, Jr.
	Vice President — Finance and CFO, Treasurer and
	Principal Financial and Accounting Officer

29

EX-31.1

Exhibit 31.1

RULE 13a-14(a) CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Keith S. Walters, Chief Executive Officer of Ennis, Inc., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Ennis, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s third fiscal quarter) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ Keith S. Walters

Keith S. Walters

Chief Executive Officer

January 5, 2018

EX-31.2

Exhibit 31.2

RULE 13a-14(a) CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Richard L. Travis, Jr., Chief Financial Officer of Ennis, Inc., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Ennis, Inc.;

2. Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s third fiscal quarter) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

/s/ Richard L. Travis, Jr.

Richard L. Travis, Jr.

Chief Financial Officer

January 5, 2018

EX-32.1

EXHIBIT 32.1

SECTION 1350 CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Keith S. Walters, Chairman of the Board and Chief Executive Officer of Ennis, Inc. (the “Company”), certify, that pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code:

(1) The Quarterly Report on Form 10-Q of the Company for the period ended November 30, 2017, as filed with the Securities Exchange Commission on the date hereof (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition, and results of operations of the Company as of the dates and for the periods expressed in the Report.

/s/ Keith S. Walters

Keith S. Walters

Chairman of the Board and

Chief Executive Officer

Date: January 5, 2018

The foregoing Certification is being furnished solely pursuant to 18 U.S.C. Section 1350; it is not being filed for purposes of Section 18 of the Securities Exchange Act, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation languages in such filing.

EX-32.2

EXHIBIT 32.2

SECTION 1350 CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Richard L. Travis, Jr., Chief Financial Officer of Ennis, Inc. (the “Company”), certify, that pursuant to Section 1350 of Chapter 63 of Title 18 of the United States Code:

(1) The Quarterly Report on Form 10-Q of the Company for the period ended November 30, 2017, as filed with the Securities Exchange Commission on the date hereof (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition, and results of operations of the Company as of the dates and for the periods expressed in the Report.

/s/ Richard L. Travis, Jr.

Richard L. Travis, Jr.

Chief Financial Officer

Date:  January 5, 2018

The foregoing Certification is being furnished solely pursuant to 18 U.S.C. Section 1350; it is not being filed for purposes of Section 18 of the Securities Exchange Act, and is not to be incorporated by reference into any filing of the Company, whether made before or after the date hereof, regardless of any general incorporation languages in such filing.

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Document and Entity Information - shares	9 Months Ended
	Nov. 30, 2017	Dec. 29, 2017
Document And Entity Information [Abstract]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Nov. 30, 2017
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Trading Symbol	EBF
Entity Registrant Name	ENNIS, INC.
Entity Central Index Key	0000033002
Current Fiscal Year End Date	--02-28
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		25,416,890

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Unaudited Consolidated Balance Sheets - USD ($) $ in Thousands	Nov. 30, 2017	Feb. 28, 2017
Current assets
Cash and cash equivalents	$ 92,930	$ 80,466
Accounts receivable, net of allowance for doubtful receivables of $1,306 at November 30, 2017 and $1,674 at February 28, 2017	38,409	37,368
Prepaid expenses	1,228	1,351
Prepaid income taxes	888	855
Inventories	27,799	27,965
Assets held for sale	1,320	1,245
Total current assets	162,574	149,250
Property, plant and equipment
Plant, machinery and equipment	135,367	136,584
Land and buildings	53,587	53,821
Other	23,556	23,644
Total property, plant and equipment	212,510	214,049
Less accumulated depreciation	166,274	164,054
Net property, plant and equipment	46,236	49,995
Goodwill	70,603	70,603
Intangible assets, net	50,746	53,927
Other assets	357	510
Total assets	330,516	324,285
Current liabilities
Accounts payable	9,988	14,202
Accrued expenses
Employee compensation and benefits	14,775	13,515
Taxes other than income	357	225
Other	1,880	2,026
Total current liabilities	27,000	29,968
Long-term debt	30,000	30,000
Liability for pension benefits	4,846	4,846
Deferred income taxes	7,408	6,953
Other liabilities	1,511	1,163
Total liabilities	70,765	72,930
Commitments and contingencies
Shareholders’ equity
Preferred stock $10 par value, authorized 1,000,000 shares; none issued
Common stock $2.50 par value, authorized 40,000,000 shares; issued 30,053,443 shares at November 30 and February 28, 2017	75,134	75,134
Additional paid-in capital	121,010	121,525
Retained earnings	160,648	150,685
Accumulated other comprehensive loss:
Minimum pension liability, net of taxes	(14,517)	(15,261)
Total accumulated other comprehensive loss	(14,517)	(15,261)
Treasury stock	(82,524)	(80,728)
Total shareholders’ equity	259,751	251,355
Total liabilities and shareholders' equity	$ 330,516	$ 324,285

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Unaudited Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Nov. 30, 2017	Feb. 28, 2017
Statement Of Financial Position [Abstract]
Allowance for doubtful receivables	$ 1,306	$ 1,674
Preferred stock, par value	$ 10	$ 10
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Common stock, par value	$ 2.50	$ 2.50
Common stock, shares authorized	40,000,000	40,000,000
Common stock, shares issued	30,053,443	30,053,443

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Unaudited Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016	Nov. 30, 2017	Nov. 30, 2016
Income Statement [Abstract]
Net sales	$ 93,606	$ 88,660	$ 283,083	$ 270,316
Cost of goods sold	63,722	63,368	192,493	191,292
Gross profit margin	29,884	25,292	90,590	79,024
Selling, general and administrative	16,699	15,833	51,167	47,961
(Gain) loss from disposal of assets	(4)	264	59	266
Income from operations	13,189	9,195	39,364	30,797
Other income (expense)
Interest expense	(163)	(172)	(557)	(405)
Other, net	108	88	238	92
Total other expense	(55)	(84)	(319)	(313)
Earnings from continuing operations before income taxes	13,134	9,111	39,045	30,484
Income tax expense	4,860	3,371	14,447	11,277
Earnings from continuing operations	8,274	5,740	24,598	19,207
Income from discontinued operations, net of tax				2,481
Loss on sale of discontinued operations, net of tax				(26,042)
Loss from discontinued operations, net of tax				(23,561)
Net earnings (loss)	$ 8,274	$ 5,740	$ 24,598	$ (4,354)
Weighted average common shares outstanding
Basic	25,360,452	25,673,824	25,387,389	25,802,658
Diluted	25,393,482	25,683,613	25,409,259	25,818,146
Earnings (loss) per share - basic and diluted
Continuing operations	$ 0.33	$ 0.22	$ 0.97	$ 0.74
Discontinued operations				(0.91)
Net earnings (loss)	0.33	0.22	0.97	(0.17)
Cash dividends per share	$ 0.200	$ 0.175	$ 0.575	$ 2.025

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Unaudited Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016	Nov. 30, 2017	Nov. 30, 2016
Statement Of Income And Comprehensive Income [Abstract]
Net earnings (loss)	$ 8,274	$ 5,740	$ 24,598	$ (4,354)
Foreign currency translation adjustment, net of deferred taxes				9,940
Adjustment to pension, net of deferred taxes	248		744
Comprehensive income	$ 8,522	$ 5,740	$ 25,342	$ 5,586

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Unaudited Consolidated Statement of Changes in Shareholders' Equity - 9 months ended Nov. 30, 2017 - USD ($) $ in Thousands	Total	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Treasury Stock [Member]
Beginning balance at Feb. 28, 2017	$ 251,355	$ 75,134	$ 121,525	$ 150,685	$ (15,261)	$ (80,728)
Beginning balance common stock, shares at Feb. 28, 2017	30,053,443	30,053,443
Beginning balance, treasury stock, shares at Feb. 28, 2017						(4,686,821)
Net earnings (loss)	$ 24,598			24,598
Adjustment to pension, net of deferred tax of $456	744				744
Dividends paid ($0.575 per share)	(14,635)			(14,635)
Stock based compensation	1,002		1,002
Exercise of stock options and restricted stock			(1,517)			$ 1,517
Exercise of stock options and restricted stock, shares						88,105
Common stock repurchases	$ (3,313)					$ (3,313)
Common stock repurchases, shares	(191,033)					(191,178)
Ending balance at Nov. 30, 2017	$ 259,751	$ 75,134	$ 121,010	$ 160,648	$ (14,517)	$ (82,524)
Ending balance common stock, shares at Nov. 30, 2017	30,053,443	30,053,443
Ending balance treasury stock, shares at Nov. 30, 2017						(4,789,894)

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Unaudited Consolidated Statement of Changes in Shareholders' Equity (Parenthetical) $ in Thousands	9 Months Ended
	Nov. 30, 2017 USD ($) $ / shares
Statement Of Stockholders Equity [Abstract]
Deferred tax adjusted to pension | $	$ 456
Dividends paid per share | $ / shares	$ 0.575

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Unaudited Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016
Cash flows from operating activities:
Net earnings (loss)	$ 24,598	$ (4,354)
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:
Depreciation	6,016	5,944
Amortization of deferred finance charges	85	36
Amortization of intangible assets	4,566	3,494
Pre-tax loss from discontinued operations		36,775
Operating cash flows of discontinued operations		538
(Gain) loss from disposal of assets	59	266
Bad debt expense, net of recoveries	(231)	118
Stock based compensation	1,002	1,019
Deferred income taxes	(1)
Changes in operating assets and liabilities, net of the effects of acquisitions:
Accounts receivable	(810)	1,426
Prepaid expenses and income taxes	90	(1,620)
Inventories	247	722
Other assets	67	(593)
Accounts payable and accrued expenses	(3,418)	(3,121)
Other liabilities	348	(7)
Liability for pension benefits	1,200	1,917
Net cash provided by operating activities	33,818	42,560
Cash flows from investing activities:
Capital expenditures	(2,092)	(1,912)
Purchase of businesses, net of cash acquired	(1,350)	(907)
Proceeds from sale of discontinued operations		107,354
Investing cash flows of discontinued operations		(279)
Proceeds from disposal of plant and property	36	663
Net cash provided by (used in) investing activities	(3,406)	104,919
Cash flows from financing activities:
Repayment of debt		(10,000)
Dividends paid	(14,635)	(52,724)
Common stock repurchases	(3,313)	(7,757)
Proceeds from exercise of stock options		2,910
Net cash used in financing activities	(17,948)	(67,571)
Net change in cash and cash equivalents	12,464	79,908
Cash and cash equivalents at beginning of period	80,466	7,957
Cash and cash equivalents at end of period	$ 92,930	$ 87,865

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Significant Accounting Policies and General Matters

9 Months Ended

Nov. 30, 2017

Accounting Policies [Abstract]

Significant Accounting Policies and General Matters

1. Significant Accounting Policies and General Matters

Basis of Presentation

These unaudited consolidated financial statements of Ennis, Inc. and its subsidiaries (collectively referred to as the “Company,” “Registrant,” “Ennis,” or “we,” “us,” or “our”) for the period ended November 30, 2017 have been prepared in accordance with generally accepted accounting principles for interim financial reporting.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended February 28, 2017, from which the accompanying consolidated balance sheet at February 28, 2017 was derived.  All intercompany balances and transactions have been eliminated in consolidation.  In the opinion of management, all adjustments considered necessary for a fair presentation of the interim financial information have been included and are of a normal recurring nature. In preparing the financial statements, the Company is required to make estimates and assumptions that affect the disclosure and reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates and judgments on an ongoing basis, including those related to bad debts, inventory valuations, property, plant and equipment, intangible assets, pension plan, accrued liabilities, and income taxes. The Company bases estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances. The results of operations for any interim period are not necessarily indicative of the results of operations for a full year.

On May 25, 2016, the Company sold Alstyle Apparel, LLC and its subsidiaries, which constituted the Company’s apparel segment (the “Apparel Segment”), to Gildan Activewear Inc.  As a result of this action, the current year and prior year disclosures reflect these operations as discontinued operations.

Recent Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”).  The update requires the service cost component of net benefit costs to be reported in the same line of the income statement as other compensation costs and the other components of net benefit costs (non-service costs) to be presented separately from the service cost component, outside a subtotal of operating income.  Additionally, only the service cost component of net benefit costs will be eligible for capitalization.  The update is required to be adopted the first quarter of fiscal year 2019 and is required to be retrospectively adopted.  The Company is currently evaluating the impact the adoption of ASU 2017-07 will have on its consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which simplifies how an entity is required to measure goodwill impairment.  The amendments in ASU 2017-04 require that goodwill impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit and the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.  The amendments in ASU 2017-04 should be applied on a prospective basis and are effective for annual or any interim goodwill impairment tests in annual reporting periods beginning after December 15, 2019.  The Company adopted ASU 2017-04 on June 1, 2017, which had no impact on the Company’s consolidated financial statements at the time of adoption.

In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718) (“ASU 2016-09”), which makes several modifications to the accounting for employee share-based payment transactions, including the requirement to recognize the income tax effects of awards that vest or settle as income tax expense.  The amendments in ASU 2016-09 also clarify the presentation of certain components of share-based awards in the statement of cash flows.  ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016.  The Company adopted ASU 2016-09 in fiscal year 2018 beginning in March of 2017.  The adoption of ASU 2016-09 did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”), which requires lessees to put most leases on the balance sheet but recognize expense on the income statement in a manner similar to current accounting.  For lessors, ASU 2016-02 also modifies the classification criteria and the accounting for sales-type and direct financing leases.  The standard requires a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements and is effective in the first quarter of fiscal year 2020.  Early adoption of ASU 2016-02 is permitted.  The Company is currently evaluating the impact the adoption of ASU 2016-02 will have on its consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”), which institutes a number of modifications to the reporting of financial assets and liabilities. These modifications include: (i) measurement of non-equity method assets and liabilities at fair value, with changes to fair value recognized through net income, (ii) performance of qualitative impairment assessments of equity investments without readily determinable fair values at each reporting period, (iii) elimination of the requirement to disclose methods and significant assumptions used in calculating the fair value of financial instruments measured at amortized cost, (iv) measurement of the fair value of financial instruments measured at amortized cost using the exit price notion consistent with Topic 820, Fair Value Measurement, (v) separate presentation in other comprehensive income of the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk, (vi) separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and (vii) evaluation of the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. This ASU is effective for financial statements issued with fiscal years beginning after December 15, 2017, including interim periods within that reporting period.  The Company is currently evaluating the impact the adoption of ASU 2016-01 will have on its consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services.  The standard will be effective for us in the first quarter of fiscal 2019.  We have a project plan in place for the transition to revenue recognition in accordance with Topic 606, including necessary changes to accounting processes, procedures and internal controls. Our initial evaluation is that the timing of revenue recognition for our various revenue streams would not be materially impacted by the adoption of this standard.  Thus, we do not expect the adoption of this standard to materially impact our consolidated financial statements, but we are still evaluating the impact on our financial statement disclosures.  As we continue our assessment, we are reviewing selected revenue contracts in detail to validate our initial conclusions. We will adopt using the modified retrospective approach with any cumulative effect recognized in retained earnings on the date of adoption.

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Accounts Receivable and Allowance for Doubtful Receivables

9 Months Ended

Nov. 30, 2017

Receivables [Abstract]

Accounts Receivable and Allowance for Doubtful Receivables

2.Accounts Receivable and Allowance for Doubtful Receivables

Accounts receivable are reduced by an allowance for an estimate of amounts that are uncollectible. Substantially all of the Company’s receivables are due from customers in the United States.  The Company extends credit to its customers based upon its evaluation of the following factors: (i) the customer’s financial condition, (ii) the amount of credit the customer requests, and (iii) the customer’s actual payment history (which includes disputed invoice resolution).  The Company does not typically require its customers to post a deposit or supply collateral.  The Company’s allowance for doubtful receivables is based on an analysis that estimates the amount of its total customer receivable balance that is not collectible.  This analysis includes assessing a default probability to customers’ receivable balances, which is influenced by several factors including (i) current market conditions, (ii) periodic review of customer creditworthiness, and (iii) review of customer receivable aging and payment trends.

The Company writes off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance in the period the payment is received. Credit losses from continuing operations have consistently been within management’s expectations.

The following table presents the activity in the Company’s allowance for doubtful receivables (in thousands):

	Three months ended						Nine months ended
	November 30,						November 30,
	2017			2016			2017			2016
Balance at beginning of period	$	1,318		$	1,820		$	1,674		$	2,041
Bad debt expense, net of recoveries		17			15			(231	)		118
Accounts written off		(29	)		(203	)		(137	)		(527	)
Balance at end of period	$	1,306		$	1,632		$	1,306		$	1,632

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Inventories

9 Months Ended

Nov. 30, 2017

Inventory Disclosure [Abstract]

Inventories

3. Inventories

The Company uses the lower of last-in, first-out (“LIFO”) cost or market to value certain of its business forms inventories and the lower of first-in, first-out (“FIFO”) cost or market to value its remaining forms inventories.  The Company regularly reviews inventories on hand, using specific aging categories, and writes down the carrying value of its inventories for excess and potentially obsolete inventories based on historical usage and estimated future usage.  In assessing the ultimate realization of its inventories, the Company is required to make judgments as to future demand requirements.  As actual future demand or market conditions may vary from those projected by the Company, adjustments to inventories may be required.

The following table summarizes the components of inventories at the different stages of production as of the dates indicated (in thousands):

	November 30,		February 28,
	2017		2017
Raw material	$	16,584	$	16,130
Work-in-process		3,336		3,199
Finished goods		7,879		8,636
	$	27,799	$	27,965

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Acquisitions

9 Months Ended

Nov. 30, 2017

Business Combinations [Abstract]

Acquisitions

4. Acquisitions

On July 7, 2017, the Company acquired the assets of a tag operation located in Ohio, for $1.4 million in cash plus the assumption of certain accrued liabilities.  Management considers this acquisition immaterial.

On January 27, 2017, the Company completed the acquisition of Independent Printing Company, Inc. and its related entities (collectively “Independent”) for $17.7 million in cash consideration, in a stock purchase transaction.  Independent has 4 locations in Wisconsin, with its main facility located in DePere, Wisconsin. The business produces presentation folders, checks, wide format and commercial printing. Independent, which generated approximately $37.0 million in unaudited sales during calendar year 2016, will continue to operate under its respective brand names.  Independent sells mainly through distributors and resellers. The Company will now have 4 folder facilities in Michigan, Kansas, California and Wisconsin, as well as wide format capabilities in Colorado and Wisconsin.

The following is a summary of the final purchase price allocation for Independent (in thousands):

Accounts receivable	$	4,252
Inventories		1,539
Other assets		575
Property, plant & equipment		5,526
Customer lists		3,390
Trademarks		2,408
Goodwill		6,066
Accounts payable and accrued liabilities		(6,079	)
	$	17,677

The results of operations for Independent are included in the Company’s consolidated financial statements from the date of acquisition.  The following table represents certain operating information on a pro forma basis as though all Independent operations had been acquired as of March 1, 2016, after the estimated impact of adjustments such as amortization of intangible assets, interest expense, interest income, and related tax effects (in thousands, except per share amounts):

	Three months ended		Nine months ended
	November 30, 2016		November 30, 2016
Pro forma net sales	$	97,803	$	297,745
Pro forma net earnings		5,990		19,957
Pro forma earnings per share - diluted		0.23		0.77

The pro forma results are not necessarily indicative of what would have occurred if the acquisitions had been in effect for the periods presented.

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Discontinued Operations

9 Months Ended

Nov. 30, 2017

Discontinued Operations And Disposal Groups [Abstract]

Discontinued Operations

5. Discontinued Operations

On May 25, 2016 the Company sold its Apparel Segment to Gildan Activewear Inc. for an all-cash purchase price of $110.0 million, subject to a working capital adjustment, customary indemnification arrangements, and the other terms of the Unit Purchase Agreement dated May 4, 2016.

The operating results of these discontinued operations only reflect revenues and expenses that are directly attributable to the Apparel Segment and that have been eliminated from continuing operations.  The following tables show the key components on the sale and discontinued operations related to the Apparel Segment that was completed on May 25, 2016 (in thousands):

Sales price	$	110,000
Carrying value of disposed		(130,174	)
Expenses related to sales (1)		(4,365	)
Loss on sale before write-off of foreign currency translation    adjustment		(24,539	)
Write-off of foreign currency translation adjustments
recorded in other comprehensive income		(16,109	)
Loss on sale of sale of discontinued operations	$	(40,648	)

(1) Includes the termination fee, in the amount of $3.0 million, paid as a result of the termination of a prior purchase agreement for the sale of the Apparel Segment to Alstyle Operations, LLC.

	Nine months ended
	November 30, 2016
Net sales	$	41,038
Income from discontinued operations before income taxes		3,873
Loss on sale of discontinued operations before income taxes		(40,648	)
Loss on discontinued operations before income taxes		(36,775	)
Income tax benefit		(13,214	)
Net loss from discontinued operations	$	(23,561	)

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Goodwill and Intangible Assets

9 Months Ended

Nov. 30, 2017

Goodwill And Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

6. Goodwill and Intangible Assets

Beginning March 1, 2017, given the general declining trend line of print sales, and its expected continuance into the foreseeable future, the Company elected to treat the recorded value of trademarks/trade names as no longer being an indefinite-lived asset. As such, as of March 1, 2017, the Company began amortizing the carrying value of these assets over their estimated remaining useful life, approximately 17 - 19 years.  The amortization expense associated with this election is expected to increase the Company’s selling, general and administrative expense line by approximately $830,000 during fiscal year 2018.

The carrying amount and accumulated amortization of the Company’s intangible assets at each balance sheet date are as follows (in thousands):

	Weighted
	Average
	Remaining		Gross
	Life		Carrying		Accumulated
As of November 30, 2017	(in years)		Amount		Amortization		Net
Amortized intangible assets
Trademarks and trade names		16.2	$	19,625	$	2,109	$	17,516
Customer lists		8.3		58,040		24,884		33,156
Noncompete		0.1		175		130		45
Patent		0.3		783		754		29
Total		11.0	$	78,623	$	27,877	$	50,746
As of February 28, 2017
Amortized intangible assets
Trademarks and trade names		8.0	$	3,642	$	1,234	$	2,408
Customer lists		8.9		57,347		21,336		36,011
Noncompete		0.8		175		86		89
Patent		1.0		783		655		128
Total		8.8	$	61,947	$	23,311	$	38,636

	November 30,		February 28,
	2017		2017
Non-amortizing intangible assets
Trademarks and trade names	$	—	$	15,291

Aggregate amortization expense for the nine months ended November 30, 2017 and November 30, 2016 was $4.6 million and $3.5 million, respectively.

The Company’s estimated amortization expense for the current and next four fiscal years ending in February of the stated fiscal year is as follows (in thousands):

2018	$	5,992
2019		5,558
2020		5,476
2021		5,406
2022		5,363

Changes in the net carrying amount of goodwill as of the dates indicated are as follows (in thousands):

Balance as of March 1, 2016	$	64,537
Goodwill acquired		6,066
Goodwill impairment		—
Balance as of February 28, 2017		70,603
Goodwill acquired		—
Goodwill impairment		—
Balance as of November 30, 2017	$	70,603

During the fiscal year ended February 28, 2017, $6.1 million was added to goodwill related to the acquisition of Independent.

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Other Accrued Expenses

9 Months Ended

Nov. 30, 2017

Payables And Accruals [Abstract]

Other Accrued Expenses

7. Other Accrued Expenses

The following table summarizes the components of other accrued expenses as of the dates indicated (in thousands):

	November 30,		February 28,
		2017		2017
Accrued taxes	$	140	$	329
Accrued legal and professional fees		438		414
Accrued interest		134		98
Accrued utilities		111		90
Accrued acquisition related obligations		759		789
Accrued credit card fees		127		119
Other accrued expenses		171		187
	$	1,880	$	2,026

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Long-Term Debt

9 Months Ended

Nov. 30, 2017

Debt Disclosure [Abstract]

Long-Term Debt

8. Long-Term Debt

Long-term debt consisted of the following as of the dates indicated (in thousands):

	November 30,		February 28,
	2017		2017
Revolving credit facility	$	30,000	$	30,000

The Company has entered into a Second Amended and Restated Credit Agreement, which has been amended from time to time, pursuant to which a credit facility has been extended to the Company (the “Credit Facility”) until August 11, 2020 that provides the Company and its subsidiaries with up to $100.0 million in revolving credit, as well as a $20.0 million sublimit for the issuance of letters of credit and a $15.0 million sublimit for swing-line loans.  Under the Credit Facility, the Company or any of its subsidiaries also can request up to three increases in the aggregate commitments in an aggregate amount not to exceed $50.0 million.  Under the Credit Facility: (i) the Company’s net leverage ratio may not exceed 3.00:1.00, (ii) the Company’s fixed charge coverage ratio may not be less than 1.25:1.00, and (iii) the Company may make dividends or distributions to shareholders so long as (a) no event of default has occurred and is continuing and (b) the Company’s net leverage ratio both before and after giving effect to any such dividend or distribution is equal to or less than 2.50:1.00.  As of November 30, 2017, the Company was in compliance with all terms and conditions of the Credit Facility.

The Credit Facility bears interest at the LIBOR rate plus a spread ranging from 1.0% to 2.0%, which rate was 2.5% (3 month LIBOR + 1.0%) at November 30, 2017 and 1.86% (2 month LIBOR + 1.0%) at February 28, 2017.  The rate is determined by our fixed charge coverage ratio of total funded debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”).  As of November 30, 2017, we had $30.0 million of borrowings under the revolving credit line and $1.2 million outstanding under standby letters of credit arrangements, leaving approximately $68.8 million available in borrowing capacity.  The Credit Facility is secured by substantially all of our assets (other than real property), as well as all capital securities of each of our subsidiaries.

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Shareholders' Equity

9 Months Ended

Nov. 30, 2017

Equity [Abstract]

Shareholders' Equity

9. Shareholders’ Equity

The Board has authorized the repurchase of up to an aggregate of $40.0 million of the Company’s outstanding common stock through a stock repurchase program.  Under the repurchase program, share purchases may be made from time to time in the open market or through privately negotiated transactions depending on market conditions, share price, trading volume and other factors.  Such purchases, if any, will be made in accordance with applicable insider trading and other securities laws and regulations.  These repurchases may be commenced or suspended at any time or from time to time without prior notice.

During the nine months ended November 30, 2017 the Company, under the program, repurchased 191,033 shares of common stock at an average price of $17.33 per share.  Since the program’s inception in October 2008, there have been 1,442,236 common shares repurchased at an average price of $14.99 per share. As of November 30, 2017 there was $18.4 million available to repurchase shares of the Company’s common stock under the program.  Unrelated to the stock repurchase program, the Company purchased 145 shares of its common stock during the nine months ended November 30, 2017.

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Stock Option Plan and Stock Based Compensation

9 Months Ended

Nov. 30, 2017

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock Option Plan and Stock Based Compensation

10. Stock Option Plan and Stock Based Compensation

The Company grants stock options and restricted stock to key executives and managerial employees and non-employee directors.  At November 30, 2017, the Company had one stock option plan, the 2004 Long-Term Incentive Plan of Ennis, Inc., as amended and restated as of June 30, 2011, formerly the 1998 Option and Restricted Stock Plan amended and restated as of May 14, 2008 (the “Plan”). The Company has 529,408 shares of unissued common stock reserved under the Plan for issuance as of November 30, 2017.  The exercise price of each stock option granted under the Plan equals a referenced price of the Company’s common stock as reported on the New York Stock Exchange on the date of grant, and an option’s maximum term is ten years. Stock options and restricted stock may be granted at different times during the year and vest ratably over various periods, from grant date up to five years. The Company uses treasury stock to satisfy option exercises and restricted stock awards.

The Company recognizes compensation expense for stock options and restricted stock grants on a straight-line basis over the requisite service period.  For the three months ended November 30, 2017 and November 30, 2016, the Company included compensation expense related to share-based compensation of $0.3 million ($0.2 million net of tax), and $0.3 million ($0.2 million net of tax), respectively, in selling, general, and administrative expenses.  For the nine months ended November 30, 2017 and November 30, 2016, the Company included compensation expense related to share-based compensation of $1.0 million ($0.6 million net of tax), and $1.0 million ($0.6 million net of tax), respectively, in selling, general, and administrative expenses.

Stock Options

The Company had the following stock option activity for the nine months ended November 30, 2017:

					Weighted
			Weighted		Average		Aggregate
	Number		Average		Remaining		Intrinsic
	of Shares		Exercise		Contractual		Value(a)
	(exact quantity)		Price		Life(inyears)		(inthousands)
Outstanding at March 1, 2017		172,496	$	15.95		4.2	$	223
Granted		—		—
Terminated		—		—
Exercised		—		—
Outstanding at November 30, 2017		172,496	$	15.95		3.5	$	896
Exercisable at November 30, 2017		170,880	$	15.97		3.4	$	884

(a) Intrinsic value is measured as the excess of fair market value of the Company’s common stock as reported on the New York Stock Exchange over the applicable exercise price.

No stock options were granted during the nine months ended November 30, 2017 and November 30, 2016.

A summary of the stock options exercised and tax benefits realized from stock based compensation is presented below (in thousands):

	Three months ended				Nine months ended
	November 30,				November 30,
	2017		2016		2017		2016
Total cash received	$	—	$	—	$	—	$	2,910
Income tax benefits		—		—		—		—
Total grant-date fair value		—		—		—		532
Intrinsic value		—		—		—		969

A summary of the Company’s unvested stock options at November 30, 2017 and the changes during the nine months ended November 30, 2017 are presented below:

				Weighted
				Average
	Number			Grant Date
	of Options			Fair Value
Unvested at March 1, 2017		5,073		$	2.41
New grants		—			—
Vested		(3,457	)		2.48
Forfeited		—			—
Unvested at November 30, 2017		1,616		$	2.24

As of November 30, 2017, there was approximately $0.8 million of unrecognized compensation cost related to unvested stock options granted under the Plan.  The weighted average remaining requisite service period of the unvested stock options was 0.4 years.

Restricted Stock

The Company had the following restricted stock grant activity for the nine months ended November 30, 2017:

				Weighted
				Average
	Number of			Grant Date
	Shares			Fair Value
Outstanding at March 1, 2017		166,546		$	16.35
Granted		74,900			16.30
Terminated		—			—
Vested		(88,105	)		15.91
Outstanding at November 30, 2017		153,341		$	16.58

As of November 30, 2017, the total remaining unrecognized compensation cost related to unvested restricted stock granted under the Plan was approximately $1.8 million.  The weighted average remaining requisite service period of the unvested restricted stock awards was 1.7 years.

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Pension Plan

9 Months Ended

Nov. 30, 2017

Compensation And Retirement Disclosure [Abstract]

Pension Plan

11. Pension Plan

The Company and certain subsidiaries have a noncontributory defined benefit retirement plan (the “Pension Plan”), covering approximately 20% of aggregate employees.  Benefits are based on years of service and the employee’s average compensation for the highest five compensation years preceding retirement or termination.

Pension expense is composed of the following components included in cost of goods sold and selling, general, and administrative expenses in the Company’s consolidated statements of earnings (in thousands):

	Three months ended						Nine months ended
	November 30,						November 30,
	2017			2016			2017			2016
Components of net periodic benefit cost
Service cost	$	271		$	292		$	812		$	875
Interest cost		567			593			1,702			1,779
Expected return on plan assets		(948	)		(917	)		(2,845	)		(2,749	)
Amortization of:
Unrecognized net loss		510			671			1,531			2,012
Net periodic benefit cost	$	400		$	639		$	1,200		$	1,917

The Company is required to make contributions to the Pension Plan.  These contributions are required under the minimum funding requirements of ERISA.  Due to the enactment of the Highway and Transportation Funding Act (HATFA) in August 2014, plan sponsors can calculate the discount rate used to measure the Pension Plan liability using a 25-year average of interest rates plus or minus a corridor.  The Company’s minimum required contribution to the Pension Plan is zero for the Pension Plan year ending February 28, 2018.  However, the Company made a cash contribution to the Pension Plan of $3.0 million on December 28, 2017 for fiscal year 2018.  The Company contributed $3.0 million to the Pension Plan during fiscal year 2017.

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Earnings (loss) per Share

9 Months Ended

Nov. 30, 2017

Earnings Per Share [Abstract]

Earnings (loss) per Share

12.Earnings (loss) per Share

Basic earnings (loss) per share have been computed by dividing net earnings by the weighted average number of common shares outstanding during the applicable period.  Diluted earnings (loss) per share reflect the potential dilution that could occur if stock options or other contracts to issue common shares were exercised or converted into common stock.

For the three months ended November 30, 2017, all options were included in the diluted earnings per share computation because the average fair market value of the Company’s stock exceeded the exercise price of the options.For the nine months ended November 30, 2017, 42,500 sharesrelated to stock options were not included in the diluted earnings per share computation because the exercise price exceeded the average fair market value of the Company’s stock.  For the three and nine months ended November 30, 2016, 95,692 and 42,500 shares related to stock options were not included in the diluted earnings per share computation because the exercise price exceeded the average fair market value of the Company’s stock.  The following table sets forth the computation for basic and diluted earnings (loss) per share for the periods indicated:

	Three months ended				Nine months ended
	November 30,				November 30,
	2017		2016		2017		2016
Basic weighted average common shares outstanding		25,360,452		25,673,824		25,387,389		25,802,658
Effect of dilutive options		33,030		9,789		21,870		15,488
Diluted weighted average common shares outstanding		25,393,482		25,683,613		25,409,259		25,818,146
Earnings (loss) per share - basic and diluted
Earnings per share on continuing operations	$	0.33	$	0.22	$	0.97	$	0.74
Earnings per share on discontinued operations		—		—		—		0.10
Loss per share on sale of discontinued operations		—		—		—		(1.01	)
Loss on discontinued operations		—		—		—		(0.91	)
Net earnings (loss)	$	0.33	$	0.22	$	0.97	$	(0.17	)
Cash dividends	$	0.200	$	0.175	$	0.575	$	2.025

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Concentrations of Risk

9 Months Ended

Nov. 30, 2017

Risks And Uncertainties [Abstract]

Concentrations of Risk

13. Concentrations of Risk

Financial instruments that potentially subject the Company to a concentration of credit risk principally consist of cash and trade receivables. Cash is placed with high-credit quality financial institutions. The Company believes its credit risk with respect to trade receivables is limited due to industry and geographic diversification. As disclosed on the Consolidated Balance Sheets, the Company maintains an allowance for doubtful receivables to cover the Company’s estimate of credit losses associated with accounts receivable.

The Company, for quality and pricing reasons, purchases its paper products from a limited number of suppliers.  While other sources may be available to the Company to purchase these products, they may not be available at the cost or at the quality the Company has come to expect.

For the purposes of the Consolidated Statements of Cash Flows, the Company considers cash to include cash on hand and in bank accounts.  The Federal Deposit Insurance Corporation insures accounts up to $250,000.  At November 30, 2017, cash balances included $92.0 million that was not federally insured because it represented amounts in individual accounts above the federally insured limit for each such account.  This at-risk amount is subject to fluctuation on a daily basis.  While management does not believe there is significant risk with respect to such deposits, we cannot be assured that we will not experience losses on our deposits.

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Subsequent Events

9 Months Ended

Nov. 30, 2017

Subsequent Events [Abstract]

Subsequent Events

14. Subsequent Events

On December 21, 2017, the Board declared a quarterly cash dividend of 20 cents per share, which will be paid on February 9, 2018 to the shareholders of record on January 12, 2018.

The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017 and is effective for tax years beginning after December 31, 2017.  The Company is currently evaluating the impact of the Act on the consolidated financial statements.  Management expects the Company’s effective tax rate and net deferred tax liabilities to decrease as a result of the reduction of the corporate tax rate from 35% to 21%, which will be partially offset by the elimination or reduction of certain tax deductions.

In conjunction with the signing of the Act, the Ennis Board of Directors approved a special one-time bonus to more than 2,200 non-management employees in the amount of $500 each.  This payment will take place with the first payroll period in January 2018.

In addition, in response to the Act, the Board of Directors declared a special one-time cash dividend of 10 cents per share of our common stock.  The dividend will be paid on February 9, 2018 to the shareholders of record on January 12, 2018.

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Significant Accounting Policies and General Matters (Policies)

9 Months Ended

Nov. 30, 2017

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

These unaudited consolidated financial statements of Ennis, Inc. and its subsidiaries (collectively referred to as the “Company,” “Registrant,” “Ennis,” or “we,” “us,” or “our”) for the period ended November 30, 2017 have been prepared in accordance with generally accepted accounting principles for interim financial reporting.  Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements and should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended February 28, 2017, from which the accompanying consolidated balance sheet at February 28, 2017 was derived.  All intercompany balances and transactions have been eliminated in consolidation.  In the opinion of management, all adjustments considered necessary for a fair presentation of the interim financial information have been included and are of a normal recurring nature. In preparing the financial statements, the Company is required to make estimates and assumptions that affect the disclosure and reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates these estimates and judgments on an ongoing basis, including those related to bad debts, inventory valuations, property, plant and equipment, intangible assets, pension plan, accrued liabilities, and income taxes. The Company bases estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances. The results of operations for any interim period are not necessarily indicative of the results of operations for a full year.

On May 25, 2016, the Company sold Alstyle Apparel, LLC and its subsidiaries, which constituted the Company’s apparel segment (the “Apparel Segment”), to Gildan Activewear Inc.  As a result of this action, the current year and prior year disclosures reflect these operations as discontinued operations.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2017-07, Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”).  The update requires the service cost component of net benefit costs to be reported in the same line of the income statement as other compensation costs and the other components of net benefit costs (non-service costs) to be presented separately from the service cost component, outside a subtotal of operating income.  Additionally, only the service cost component of net benefit costs will be eligible for capitalization.  The update is required to be adopted the first quarter of fiscal year 2019 and is required to be retrospectively adopted.  The Company is currently evaluating the impact the adoption of ASU 2017-07 will have on its consolidated financial statements.

In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”), which simplifies how an entity is required to measure goodwill impairment.  The amendments in ASU 2017-04 require that goodwill impairment will be measured using the difference between the carrying amount and the fair value of the reporting unit and the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit.  The amendments in ASU 2017-04 should be applied on a prospective basis and are effective for annual or any interim goodwill impairment tests in annual reporting periods beginning after December 15, 2019.  The Company adopted ASU 2017-04 on June 1, 2017, which had no impact on the Company’s consolidated financial statements at the time of adoption.

In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718) (“ASU 2016-09”), which makes several modifications to the accounting for employee share-based payment transactions, including the requirement to recognize the income tax effects of awards that vest or settle as income tax expense.  The amendments in ASU 2016-09 also clarify the presentation of certain components of share-based awards in the statement of cash flows.  ASU 2016-09 is effective for annual reporting periods beginning after December 15, 2016.  The Company adopted ASU 2016-09 in fiscal year 2018 beginning in March of 2017.  The adoption of ASU 2016-09 did not have a material impact on the Company’s consolidated financial statements and related disclosures.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”), which requires lessees to put most leases on the balance sheet but recognize expense on the income statement in a manner similar to current accounting.  For lessors, ASU 2016-02 also modifies the classification criteria and the accounting for sales-type and direct financing leases.  The standard requires a modified retrospective approach for leases that exist or are entered into after the beginning of the earliest comparative period in the financial statements and is effective in the first quarter of fiscal year 2020.  Early adoption of ASU 2016-02 is permitted.  The Company is currently evaluating the impact the adoption of ASU 2016-02 will have on its consolidated financial statements.

In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities (“ASU 2016-01”), which institutes a number of modifications to the reporting of financial assets and liabilities. These modifications include: (i) measurement of non-equity method assets and liabilities at fair value, with changes to fair value recognized through net income, (ii) performance of qualitative impairment assessments of equity investments without readily determinable fair values at each reporting period, (iii) elimination of the requirement to disclose methods and significant assumptions used in calculating the fair value of financial instruments measured at amortized cost, (iv) measurement of the fair value of financial instruments measured at amortized cost using the exit price notion consistent with Topic 820, Fair Value Measurement, (v) separate presentation in other comprehensive income of the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk, (vi) separate presentation of financial assets and financial liabilities by measurement category and form of financial asset, and (vii) evaluation of the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets. This ASU is effective for financial statements issued with fiscal years beginning after December 15, 2017, including interim periods within that reporting period.  The Company is currently evaluating the impact the adoption of ASU 2016-01 will have on its consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”), which requires an entity to recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services.  The standard will be effective for us in the first quarter of fiscal 2019.  We have a project plan in place for the transition to revenue recognition in accordance with Topic 606, including necessary changes to accounting processes, procedures and internal controls. Our initial evaluation is that the timing of revenue recognition for our various revenue streams would not be materially impacted by the adoption of this standard.  Thus, we do not expect the adoption of this standard to materially impact our consolidated financial statements, but we are still evaluating the impact on our financial statement disclosures.  As we continue our assessment, we are reviewing selected revenue contracts in detail to validate our initial conclusions. We will adopt using the modified retrospective approach with any cumulative effect recognized in retained earnings on the date of adoption.

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Accounts Receivable and Allowance for Doubtful Receivables (Tables)

9 Months Ended

Nov. 30, 2017

Receivables [Abstract]

Allowance for Doubtful Receivables

The following table presents the activity in the Company’s allowance for doubtful receivables (in thousands):

	Three months ended						Nine months ended
	November 30,						November 30,
	2017			2016			2017			2016
Balance at beginning of period	$	1,318		$	1,820		$	1,674		$	2,041
Bad debt expense, net of recoveries		17			15			(231	)		118
Accounts written off		(29	)		(203	)		(137	)		(527	)
Balance at end of period	$	1,306		$	1,632		$	1,306		$	1,632

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Inventories (Tables)

9 Months Ended

Nov. 30, 2017

Inventory Disclosure [Abstract]

Components of Inventories

The following table summarizes the components of inventories at the different stages of production as of the dates indicated (in thousands):

	November 30,		February 28,
	2017		2017
Raw material	$	16,584	$	16,130
Work-in-process		3,336		3,199
Finished goods		7,879		8,636
	$	27,799	$	27,965

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Acquisitions (Tables)

9 Months Ended

Nov. 30, 2017

Business Combinations [Abstract]

Summary of Final Purchase Price Allocation

The following is a summary of the final purchase price allocation for Independent (in thousands):

Accounts receivable	$	4,252
Inventories		1,539
Other assets		575
Property, plant & equipment		5,526
Customer lists		3,390
Trademarks		2,408
Goodwill		6,066
Accounts payable and accrued liabilities		(6,079	)
	$	17,677

Summary of Operating Information on a Pro Forma Basis

The following table represents certain operating information on a pro forma basis as though all Independent operations had been acquired as of March 1, 2016, after the estimated impact of adjustments such as amortization of intangible assets, interest expense, interest income, and related tax effects (in thousands, except per share amounts):

	Three months ended		Nine months ended
	November 30, 2016		November 30, 2016
Pro forma net sales	$	97,803	$	297,745
Pro forma net earnings		5,990		19,957
Pro forma earnings per share - diluted		0.23		0.77

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Discontinued Operations (Tables)

9 Months Ended

Nov. 30, 2017

Discontinued Operations And Disposal Groups [Abstract]

Schedule of Discontinued Operations Related to Apparel Segment

The following tables show the key components on the sale and discontinued operations related to the Apparel Segment that was completed on May 25, 2016 (in thousands):

Sales price	$	110,000
Carrying value of disposed		(130,174	)
Expenses related to sales (1)		(4,365	)
Loss on sale before write-off of foreign currency translation    adjustment		(24,539	)
Write-off of foreign currency translation adjustments
recorded in other comprehensive income		(16,109	)
Loss on sale of sale of discontinued operations	$	(40,648	)

(1) Includes the termination fee, in the amount of $3.0 million, paid as a result of the termination of a prior purchase agreement for the sale of the Apparel Segment to Alstyle Operations, LLC.

	Nine months ended
	November 30, 2016
Net sales	$	41,038
Income from discontinued operations before income taxes		3,873
Loss on sale of discontinued operations before income taxes		(40,648	)
Loss on discontinued operations before income taxes		(36,775	)
Income tax benefit		(13,214	)
Net loss from discontinued operations	$	(23,561	)

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Goodwill and Intangible Assets (Tables)

9 Months Ended

Nov. 30, 2017

Goodwill And Intangible Assets Disclosure [Abstract]

Carrying Amount and Accumulated Amortization of Intangible Assets

The carrying amount and accumulated amortization of the Company’s intangible assets at each balance sheet date are as follows (in thousands):

	Weighted
	Average
	Remaining		Gross
	Life		Carrying		Accumulated
As of November 30, 2017	(in years)		Amount		Amortization		Net
Amortized intangible assets
Trademarks and trade names		16.2	$	19,625	$	2,109	$	17,516
Customer lists		8.3		58,040		24,884		33,156
Noncompete		0.1		175		130		45
Patent		0.3		783		754		29
Total		11.0	$	78,623	$	27,877	$	50,746
As of February 28, 2017
Amortized intangible assets
Trademarks and trade names		8.0	$	3,642	$	1,234	$	2,408
Customer lists		8.9		57,347		21,336		36,011
Noncompete		0.8		175		86		89
Patent		1.0		783		655		128
Total		8.8	$	61,947	$	23,311	$	38,636

Non-amortizing Intangible Assets

	November 30,		February 28,
	2017		2017
Non-amortizing intangible assets
Trademarks and trade names	$	—	$	15,291

Estimated Amortization Expense

The Company’s estimated amortization expense for the current and next four fiscal years ending in February of the stated fiscal year is as follows (in thousands):

2018	$	5,992
2019		5,558
2020		5,476
2021		5,406
2022		5,363

Changes in Net Carrying Amount of Goodwill

Changes in the net carrying amount of goodwill as of the dates indicated are as follows (in thousands):

Balance as of March 1, 2016	$	64,537
Goodwill acquired		6,066
Goodwill impairment		—
Balance as of February 28, 2017		70,603
Goodwill acquired		—
Goodwill impairment		—
Balance as of November 30, 2017	$	70,603

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Other Accrued Expenses (Tables)

9 Months Ended

Nov. 30, 2017

Payables And Accruals [Abstract]

Components of Other Accrued Expenses

The following table summarizes the components of other accrued expenses as of the dates indicated (in thousands):

	November 30,		February 28,
		2017		2017
Accrued taxes	$	140	$	329
Accrued legal and professional fees		438		414
Accrued interest		134		98
Accrued utilities		111		90
Accrued acquisition related obligations		759		789
Accrued credit card fees		127		119
Other accrued expenses		171		187
	$	1,880	$	2,026

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Long-Term Debt (Tables)

9 Months Ended

Nov. 30, 2017

Debt Disclosure [Abstract]

Summary of Long-Term Debt

Long-term debt consisted of the following as of the dates indicated (in thousands):

	November 30,		February 28,
	2017		2017
Revolving credit facility	$	30,000	$	30,000

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Stock Option Plan and Stock Based Compensation (Tables)

9 Months Ended

Nov. 30, 2017

Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]

Stock Option Activity

The Company had the following stock option activity for the nine months ended November 30, 2017:

					Weighted
			Weighted		Average		Aggregate
	Number		Average		Remaining		Intrinsic
	of Shares		Exercise		Contractual		Value(a)
	(exact quantity)		Price		Life(inyears)		(inthousands)
Outstanding at March 1, 2017		172,496	$	15.95		4.2	$	223
Granted		—		—
Terminated		—		—
Exercised		—		—
Outstanding at November 30, 2017		172,496	$	15.95		3.5	$	896
Exercisable at November 30, 2017		170,880	$	15.97		3.4	$	884

(a) Intrinsic value is measured as the excess of fair market value of the Company’s common stock as reported on the New York Stock Exchange over the applicable exercise price.

Summary of Stock Options Exercised and Tax Benefits Realized from Stock Based Compensation

A summary of the stock options exercised and tax benefits realized from stock based compensation is presented below (in thousands):

	Three months ended				Nine months ended
	November 30,				November 30,
	2017		2016		2017		2016
Total cash received	$	—	$	—	$	—	$	2,910
Income tax benefits		—		—		—		—
Total grant-date fair value		—		—		—		532
Intrinsic value		—		—		—		969

Summary of Unvested Stock Options

A summary of the Company’s unvested stock options at November 30, 2017 and the changes during the nine months ended November 30, 2017 are presented below:

				Weighted
				Average
	Number			Grant Date
	of Options			Fair Value
Unvested at March 1, 2017		5,073		$	2.41
New grants		—			—
Vested		(3,457	)		2.48
Forfeited		—			—
Unvested at November 30, 2017		1,616		$	2.24

Restricted Stock Grant Activity

The Company had the following restricted stock grant activity for the nine months ended November 30, 2017:

				Weighted
				Average
	Number of			Grant Date
	Shares			Fair Value
Outstanding at March 1, 2017		166,546		$	16.35
Granted		74,900			16.30
Terminated		—			—
Vested		(88,105	)		15.91
Outstanding at November 30, 2017		153,341		$	16.58

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Pension Plan (Tables)

9 Months Ended

Nov. 30, 2017

Compensation And Retirement Disclosure [Abstract]

Summary of Pension Expense Composed of Components Included in Cost of Goods Sold and Selling, General and Administrative Expenses

Pension expense is composed of the following components included in cost of goods sold and selling, general, and administrative expenses in the Company’s consolidated statements of earnings (in thousands):

	Three months ended						Nine months ended
	November 30,						November 30,
	2017			2016			2017			2016
Components of net periodic benefit cost
Service cost	$	271		$	292		$	812		$	875
Interest cost		567			593			1,702			1,779
Expected return on plan assets		(948	)		(917	)		(2,845	)		(2,749	)
Amortization of:
Unrecognized net loss		510			671			1,531			2,012
Net periodic benefit cost	$	400		$	639		$	1,200		$	1,917

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Earnings (loss) per Share (Tables)

9 Months Ended

Nov. 30, 2017

Earnings Per Share [Abstract]

Computation for Basic and Diluted Earnings (loss) per Share

The following table sets forth the computation for basic and diluted earnings (loss) per share for the periods indicated:

	Three months ended				Nine months ended
	November 30,				November 30,
	2017		2016		2017		2016
Basic weighted average common shares outstanding		25,360,452		25,673,824		25,387,389		25,802,658
Effect of dilutive options		33,030		9,789		21,870		15,488
Diluted weighted average common shares outstanding		25,393,482		25,683,613		25,409,259		25,818,146
Earnings (loss) per share - basic and diluted
Earnings per share on continuing operations	$	0.33	$	0.22	$	0.97	$	0.74
Earnings per share on discontinued operations		—		—		—		0.10
Loss per share on sale of discontinued operations		—		—		—		(1.01	)
Loss on discontinued operations		—		—		—		(0.91	)
Net earnings (loss)	$	0.33	$	0.22	$	0.97	$	(0.17	)
Cash dividends	$	0.200	$	0.175	$	0.575	$	2.025

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Accounts Receivable and Allowance for Doubtful Receivables - Allowance for Doubtful Receivables (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016	Nov. 30, 2017	Nov. 30, 2016
Receivables [Abstract]
Balance at beginning of period	$ 1,318	$ 1,820	$ 1,674	$ 2,041
Bad debt expense, net of recoveries	17	15	(231)	118
Accounts written off	(29)	(203)	(137)	(527)
Balance at end of period	$ 1,306	$ 1,632	$ 1,306	$ 1,632

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Inventories - Components of Inventories (Detail) - USD ($) $ in Thousands	Nov. 30, 2017	Feb. 28, 2017
Inventory Disclosure [Abstract]
Raw material	$ 16,584	$ 16,130
Work-in-process	3,336	3,199
Finished goods	7,879	8,636
Inventories	$ 27,799	$ 27,965

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Acquisitions - Additional Information (Detail) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Nov. 30, 2017 USD ($)	Nov. 30, 2016 USD ($)	Nov. 30, 2017 USD ($)	Nov. 30, 2016 USD ($)	Dec. 31, 2016 USD ($)	Jul. 07, 2017 USD ($)	Jan. 27, 2017 USD ($) Location Facility
Business Acquisition [Line Items]
Net sales	$ 93,606	$ 88,660	$ 283,083	$ 270,316
Tag Company [Member]
Business Acquisition [Line Items]
Total purchase consideration						$ 1,400
Independent Printing Company, Inc. [Member]
Business Acquisition [Line Items]
Total purchase consideration							$ 17,677
Number of location | Location							4
Number of folder facilities | Facility							4
Net sales					$ 37,000

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Acquisitions - Summary of Final Purchase Price Allocation (Detail) - USD ($) $ in Thousands	Nov. 30, 2017	Feb. 28, 2017	Jan. 27, 2017	Feb. 29, 2016
Business Acquisition [Line Items]
Goodwill	$ 70,603	$ 70,603		$ 64,537
Independent Printing Company, Inc. [Member]
Business Acquisition [Line Items]
Accounts receivable			$ 4,252
Inventories			1,539
Other assets			575
Property, plant & equipment			5,526
Goodwill			6,066
Accounts payable and accrued liabilities			(6,079)
Total purchase consideration			17,677
Independent Printing Company, Inc. [Member] | Customer Lists [Member]
Business Acquisition [Line Items]
Customer lists and Trademarks			3,390
Independent Printing Company, Inc. [Member] | Trademarks [Member]
Business Acquisition [Line Items]
Customer lists and Trademarks			$ 2,408

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Acquisitions - Summary of Operating Information on Pro Forma Basis (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	9 Months Ended
	Nov. 30, 2016	Nov. 30, 2016
Business Combinations [Abstract]
Pro forma net sales	$ 97,803	$ 297,745
Pro forma net earnings	$ 5,990	$ 19,957
Pro forma earnings per share - diluted	$ 0.23	$ 0.77

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Discontinued Operations - Additional Information (Detail) - Apparel Segment [Member] $ in Thousands	May 25, 2016 USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Purchase price, cash to be received	$ 110,000
Gildan Activewear Inc. [Member] | Gildan Purchase Agreement [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Purchase price, cash to be received	$ 110,000

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Discontinued Operations - Schedule of Discontinued Operations Related to the Apparel Segment (Detail) - USD ($) $ in Thousands			9 Months Ended
		May 25, 2016	Nov. 30, 2016
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Loss on discontinued operations before income taxes			$ (36,775)
Loss from discontinued operations, net of tax			(23,561)
Apparel Segment [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sales price		$ 110,000
Carrying value of disposed		(130,174)
Expenses related to sales	[1]	(4,365)
Loss on sale before write-off of foreign currency translation adjustment		(24,539)
Write-off of foreign currency translation adjustments recorded in other comprehensive income		(16,109)
Loss on sale of sale of discontinued operations		(40,648)	(40,648)
Net sales			41,038
Income from discontinued operations before income taxes			3,873
Loss on sale of discontinued operations before income taxes		$ (40,648)	(40,648)
Loss on discontinued operations before income taxes			(36,775)
Income tax benefit			(13,214)
Loss from discontinued operations, net of tax			$ (23,561)

[1] Includes the termination fee, in the amount of $3.0 million, paid as a result of the termination of a prior purchase agreement for the sale of the Apparel Segment to Alstyle Operations, LLC.

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Discontinued Operations - Schedule of Discontinued Operations Related to the Apparel Segment (Parenthetical) (Detail) $ in Millions	May 25, 2016 USD ($)
Apparel Segment [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Termination fee paid	$ 3.0

XML

Goodwill and Intangible Assets - Additional Information (Detail) - USD ($)		9 Months Ended		12 Months Ended
	Mar. 02, 2017	Nov. 30, 2017	Nov. 30, 2016	Feb. 28, 2018	Feb. 28, 2017
Finite-Lived Intangible Assets [Line Items]
Amortization of trade names, customer lists, and patent		$ 4,566,000	$ 3,494,000
Goodwill acquired					$ 6,066,000
Independent Printing Company, Inc. [Member]
Finite-Lived Intangible Assets [Line Items]
Goodwill acquired					$ 6,100,000
Selling, General and Administrative [Member] | Scenario Forecast [Member]
Finite-Lived Intangible Assets [Line Items]
Amortization of trade names, customer lists, and patent				$ 830,000
Minimum [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining estimated useful life	17 years
Maximum [Member]
Finite-Lived Intangible Assets [Line Items]
Remaining estimated useful life	19 years

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Goodwill and Intangible Assets - Carrying Amount and Accumulated Amortization of Intangible Assets (Detail) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Nov. 30, 2017	Feb. 28, 2017
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Life (in years)	11 years	8 years 9 months 18 days
Gross Carrying Amount	$ 78,623	$ 61,947
Accumulated Amortization	27,877	23,311
Amortized intangible assets, Net	$ 50,746	$ 38,636
Trademarks and Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Life (in years)	16 years 2 months 12 days	8 years
Gross Carrying Amount	$ 19,625	$ 3,642
Accumulated Amortization	2,109	1,234
Amortized intangible assets, Net	$ 17,516	$ 2,408
Customer Lists [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Life (in years)	8 years 3 months 18 days	8 years 10 months 25 days
Gross Carrying Amount	$ 58,040	$ 57,347
Accumulated Amortization	24,884	21,336
Amortized intangible assets, Net	$ 33,156	$ 36,011
Noncompete [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Life (in years)	1 month 6 days	9 months 18 days
Gross Carrying Amount	$ 175	$ 175
Accumulated Amortization	130	86
Amortized intangible assets, Net	$ 45	$ 89
Patent [Member]
Finite-Lived Intangible Assets [Line Items]
Weighted Average Remaining Life (in years)	3 months 18 days	1 year
Gross Carrying Amount	$ 783	$ 783
Accumulated Amortization	754	655
Amortized intangible assets, Net	$ 29	$ 128

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Goodwill and Intangible Assets - Non-amortizing Intangible Assets (Detail) $ in Thousands	Feb. 28, 2017 USD ($)
Non-amortizing intangible assets
Non-amortizing intangible assets, Trademarks and trade names	$ 15,291

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Goodwill and Intangible Assets - Estimated Amortization Expense (Detail) $ in Thousands	Nov. 30, 2017 USD ($)
Goodwill And Intangible Assets Disclosure [Abstract]
2018	$ 5,992
2019	5,558
2020	5,476
2021	5,406
2022	$ 5,363

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Goodwill and Intangible Assets - Changes in Net Carrying Amount of Goodwill (Detail) $ in Thousands	12 Months Ended
	Feb. 28, 2017 USD ($)
Goodwill And Intangible Assets Disclosure [Abstract]
Goodwill, Beginning balance	$ 64,537
Goodwill acquired	6,066
Goodwill impairment	0
Goodwill, Ending balance	$ 70,603

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Other Accrued Expenses - Components of Other Accrued Expenses (Detail) - USD ($) $ in Thousands	Nov. 30, 2017	Feb. 28, 2017
Payables And Accruals [Abstract]
Accrued taxes	$ 140	$ 329
Accrued legal and professional fees	438	414
Accrued interest	134	98
Accrued utilities	111	90
Accrued acquisition related obligations	759	789
Accrued credit card fees	127	119
Other accrued expenses	171	187
Other accrued expenses, Total	$ 1,880	$ 2,026

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Long-Term Debt - Summary of Long-Term Debt (Detail) - USD ($) $ in Thousands	Nov. 30, 2017	Feb. 28, 2017
Line of Credit Facility [Line Items]
Revolving credit facility	$ 30,000	$ 30,000
Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Revolving credit facility	$ 30,000	$ 30,000

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Long-Term Debt - Additional Information (Detail)		9 Months Ended
	Feb. 28, 2017	Nov. 30, 2017 USD ($)
Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Long-term debt		$ 30,000,000
Second Amendment [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Credit facility maturity date		Aug. 11, 2020
Revolving credit facility, maximum borrowing capacity		$ 100,000,000
Revolving credit facility, additional borrowing capacity		$ 50,000,000
Fixed charge coverage ratio, minimum		1.25
Line of credit facility, borrowing capacity description		(i) the Company’s net leverage ratio may not exceed 3.00:1.00, (ii) the Company’s fixed charge coverage ratio may not be less than 1.25:1.00, and (iii) the Company may make dividends or distributions to shareholders so long as (a) no event of default has occurred and is continuing and (b) the Company’s net leverage ratio both before and after giving effect to any such dividend or distribution is equal to or less than 2.50:1.00.
Revolving credit facility, interest rate description		LIBOR rate plus a spread ranging from 1.0% to 2.0%, which rate was 2.5% (3 month LIBOR + 1.0%) at November 30, 2017 and 1.86% (2 month LIBOR + 1.0%) at February 28, 2017.
Revolving credit facility, variable basis spread	1.00%	1.00%
Revolving credit facility, interest rate	1.86%	2.50%
Second Amendment [Member] | Revolving Credit Facility [Member] | Maximum [Member]
Line of Credit Facility [Line Items]
Net leverage ratio		3.00
Revolving credit facility, variable basis spread		2.00%
Second Amendment [Member] | Revolving Credit Facility [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Revolving credit facility, variable basis spread		1.00%
Second Amendment [Member] | Revolving Credit Facility [Member] | Dividends or Distributions Effect [Member] | Minimum [Member]
Line of Credit Facility [Line Items]
Net leverage ratio		2.50
Second Amendment [Member] | Letter of Credit [Member]
Line of Credit Facility [Line Items]
Long-term debt		$ 20,000,000
Second Amendment [Member] | Swing-line Loans [Member]
Line of Credit Facility [Line Items]
Long-term debt		15,000,000
Third Amendment [Member] | Standby Letters of Credit [Member]
Line of Credit Facility [Line Items]
Long-term debt		1,200,000
Revolving credit facility, remaining borrowing capacity		$ 68,800,000

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Shareholders' Equity - Additional Information (Detail)		9 Months Ended	109 Months Ended
	Nov. 30, 2017 USD ($)	Nov. 30, 2017 USD ($) $ / shares shares	Nov. 30, 2017 USD ($) $ / shares shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Repurchase of common stock through a stock repurchase program | $	$ 40,000,000	$ 40,000,000	$ 40,000,000
Repurchase of common stock | shares		191,033	1,442,236
Repurchase of common stock, average cost per share | $ / shares		$ 17.33	$ 14.99
Total amount available to repurchase of shares | $	$ 18,400,000
Unrelated to Stock Repurchase Program [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Repurchase of common stock | shares		145

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Stock Option Plan and Stock Based Compensation - Additional Information (Detail) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016	Nov. 30, 2017	Nov. 30, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Unissued common stock reserved	529,408		529,408
Stock option award maximum term			10 years
Share based compensation arrangements by share based payment award vesting period maximum			5 years
Number of stock options granted			0	0
Unrecognized compensation cost related to unvested stock options granted	$ 0.8		$ 0.8
Remaining unrecognized compensation cost related to unvested restricted stock	1.8		$ 1.8
Weighted average remaining requisite service period of the unvested restricted stock awards			1 year 8 months 12 days
Unvested Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average remaining requisite service period of the unvested stock options			4 months 24 days
Selling, General and Administrative [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense related share based compensation before tax	0.3	$ 0.3	$ 1.0	$ 1.0
Compensation expense related share based compensation net of tax	$ 0.2	$ 0.2	$ 0.6	$ 0.6

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Stock Option Plan and Stock Based Compensation - Stock Option Activity (Detail) - USD ($) $ / shares in Units, $ in Thousands	9 Months Ended		12 Months Ended
	Nov. 30, 2017	Nov. 30, 2016	Feb. 28, 2017
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Number of Shares, Options Outstanding, Beginning Balance	172,496
Number of Shares, Granted	0	0
Number of Shares, Terminated	0
Number of Shares, Exercised	0
Number of Shares, Options Outstanding, Ending Balance	172,496		172,496
Number of Shares, Exercisable	170,880
Weighted Average Exercise Price, Beginning Balance	$ 15.95
Weighted Average Exercise Price, Granted	0
Weighted Average Exercise Price, Terminated	0
Weighted Average Exercise Price, Exercised	0
Weighted Average Exercise Price, Ending Balance	15.95		$ 15.95
Weighted Average Exercise Price, Exercisable	$ 15.97
Weighted Average Remaining Contractual Life (in years)	3 years 6 months		4 years 2 months 12 days
Weighted Average Remaining Contractual Life, Exercisable	3 years 4 months 24 days
Aggregate Intrinsic Value	$ 896		$ 223
Aggregate Intrinsic Value, Exercisable	$ 884

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Stock Option Plan and Stock Based Compensation - Summary of Stock Options Exercised and Tax Benefits Realized from Stock Based Compensation (Detail) $ in Thousands	9 Months Ended
	Nov. 30, 2016 USD ($)
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Total cash received	$ 2,910
Total grant-date fair value	532
Intrinsic value	$ 969

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Stock Option Plan and Stock Based Compensation - Summary of Unvested Stock Options (Detail) - $ / shares	9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract]
Unvested Beginning Balance, Number of Options	5,073
New grants, Number of Options	0	0
Vested, Number of Options	(3,457)
Forfeited, Number of Options	0
Unvested Ending Balance, Number of Options	1,616
Unvested Beginning Balance, Weighted Average Grant Date Fair Value	$ 2.41
New grants, Weighted Average Grant Date Fair Value	0
Vested, Weighted Average Grant Date Fair Value	2.48
Forfeited, Weighted Average Grant Date Fair Value	0
Unvested Ending Balance, Weighted Average Grant Date Fair Value	$ 2.24

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Stock Option Plan and Stock Based Compensation - Restricted Stock Grant Activity (Detail) - Restricted Stock [Member]	9 Months Ended
	Nov. 30, 2017 $ / shares shares
Restricted stock grant activity
Outstanding at Beginning, Number of Shares | shares	166,546
Number of Shares, Granted | shares	74,900
Number of Shares, Terminated | shares	0
Number of Shares, Vested | shares	(88,105)
Outstanding at Ending, Number of Shares | shares	153,341
Outstanding at Beginning, Weighted Average Grant Date Fair value | $ / shares	$ 16.35
Weighted Average Grant Date Fair Value, Granted | $ / shares	16.30
Weighted Average Grant Date Fair Value, Terminated | $ / shares	0
Weighted Average Grant Date Fair Value, Vested | $ / shares	15.91
Outstanding at Ending, Weighted Average Grant Date Fair value | $ / shares	$ 16.58

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Pension Plan - Additional Information (Detail) - USD ($)		9 Months Ended	12 Months Ended
	Dec. 28, 2017	Nov. 30, 2017	Feb. 28, 2017	Feb. 28, 2018
Defined Benefit Plan Disclosure [Line Items]
Employees covered under noncontributory Pension Plan		20.00%
Compensation period preceding retirement and termination		5 years
Period used for calculating Pension Plan liability		25 years
Cash contribution to the pension plan			$ 3,000,000
Scenario Forecast [Member]
Defined Benefit Plan Disclosure [Line Items]
Minimum required contribution to the plan is approximately				$ 0
Subsequent Event [Member]
Defined Benefit Plan Disclosure [Line Items]
Cash contribution to the pension plan	$ 3,000,000

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Pension Plan - Summary of Pension Expense Composed of Components Included in Cost of Goods Sold and Selling, General and Administrative Expenses (Detail) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016	Nov. 30, 2017	Nov. 30, 2016
Components of net periodic benefit cost
Service cost	$ 271	$ 292	$ 812	$ 875
Interest cost	567	593	1,702	1,779
Expected return on plan assets	(948)	(917)	(2,845)	(2,749)
Amortization of:
Unrecognized net loss	510	671	1,531	2,012
Net periodic benefit cost	$ 400	$ 639	$ 1,200	$ 1,917

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Earnings (loss) per Share - Additional Information (Detail) - shares	3 Months Ended	9 Months Ended
	Nov. 30, 2016	Nov. 30, 2017	Nov. 30, 2016
Earnings Per Share [Abstract]
Stock options not included in the diluted earnings per share computation	95,692	42,500	42,500

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Earnings (loss) per Share - Computation for Basic and Diluted Earnings (loss) per Share (Detail) - $ / shares	3 Months Ended		9 Months Ended
	Nov. 30, 2017	Nov. 30, 2016	Nov. 30, 2017	Nov. 30, 2016
Earnings Per Share [Abstract]
Basic weighted average common shares outstanding	25,360,452	25,673,824	25,387,389	25,802,658
Effect of dilutive options	33,030	9,789	21,870	15,488
Diluted weighted average common shares outstanding	25,393,482	25,683,613	25,409,259	25,818,146
Earnings (loss) per share - basic and diluted
Earnings per share on continuing operations	$ 0.33	$ 0.22	$ 0.97	$ 0.74
Earnings per share on discontinued operations				0.10
Loss per share on sale of discontinued operations				(1.01)
Loss on discontinued operations				(0.91)
Net earnings (loss)	0.33	0.22	0.97	(0.17)
Cash dividends	$ 0.200	$ 0.175	$ 0.575	$ 2.025

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Concentrations of Risk - Additional Information (Detail)	Nov. 30, 2017 USD ($)
Risks And Uncertainties [Abstract]
Maximum insurance available to depositors under the FDIC's general deposit insurance rules	$ 250,000
Cash balances not federally insured	$ 92,000,000

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Subsequent Events - Additional Information (Detail)			9 Months Ended
	Dec. 22, 2017	Dec. 21, 2017 USD ($) Employee $ / shares	Nov. 30, 2017
Subsequent Event [Line Items]
Dividend payable date			Feb. 09, 2018
Dividend payable, date of record			Jan. 12, 2018
Corporate tax rate			35.00%
Subsequent Event [Member]
Subsequent Event [Line Items]
Dividend payable per share		$ 0.20
Corporate tax rate	21.00%
Subsequent Event [Member] | Special One-time Cash Dividend [Member]
Subsequent Event [Line Items]
Dividend payable per share		$ 0.10
Dividend payable date		Feb. 09, 2018
Dividend payable, date of record		Jan. 12, 2018
Subsequent Event [Member] | Non-management Employees [Member] | Special One-time Bonus [Member]
Subsequent Event [Line Items]
Bonus payment to each employee | $		$ 500
Subsequent Event [Member] | Non-management Employees [Member] | Special One-time Bonus [Member] | Minimum [Member]
Subsequent Event [Line Items]
Number of employees | Employee		2,200