8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): August 2, 2007

NASHUA CORPORATION

(Exact name of registrant as specified in its charter)

Massachusetts	1-05492	02-0170100
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

11 Trafalgar Square, Suite 201
Nashua, New Hampshire 03063
(Address of principal executive offices and zip code)

(603)880-2323
(Registrant’s telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

EX-99.1 Press Release, dated August 2, 2007

Item 2.02 – Results of Operations and Financial Condition

          On August 2, 2007, Nashua Corporation announced its financial results for the second quarter ended June 29, 2007. The full text of the press release issued in connection with the announcement is attached as Exhibit 99.1 to this Current Report on Form 8-K.

          The information in this Form 8-K and the Exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 9.01 — Financial Statements and Exhibits

(d) Exhibits

     The following exhibit relating to Item 2.02 shall be deemed to be furnished, and not filed:

Exhibit
Number		Description
	99.1	Press Release — “Nashua Reports Second Quarter 2007 Results” dated August 2, 2007

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 hereunto duly authorized.

		NASHUA CORPORATION
Date: August 3, 2007	By	/s/ John L. Patenaude
		John L. Patenaude
		Vice President-Finance, Chief Financial Officer and Treasurer

EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release — “Nashua Reports Second Quarter 2007 Results” dated August 2, 2007

EX-99.1

Exhibit 99.1

Contact: Tom Brooker/John Patenaude
Nashua Corporation
847-318-1797/603-880-2145 Rich Coyle
Sard Verbinnen & Co
212-687-8080

NASHUA REPORTS SECOND QUARTER 2007 RESULTS

     NASHUA, N.H., August 2, 2007 — Nashua Corporation (NASDAQ: NSHA), a manufacturer and marketer of labels, thermal specialty papers and imaging products, today announced financial results for the second quarter ended June 29, 2007.

Net sales for the second quarter of 2007 were $67.7 million, compared to $65.5 million for the second quarter of 2006. Gross margin for the second quarter of 2007 was $12.3 million, or 18.2%, compared to $9.5 million, or 14.5%, for the second quarter of 2006. Income from continuing operations before income taxes was $2.1 million in the second quarter of 2007 compared to a loss from continuing operations before income taxes of $1.6 million in the second quarter of 2006. Net income was $1.3 million in the second quarter of 2007, or $0.21 per share, compared to a net loss of $1.0 million, or $0.16 per share, in the second quarter of 2006. Earnings before interest, taxes, depreciation and amortization (EBITDA) were $3.3 million for the second quarter of 2007 compared to $0.2 million for the second quarter of 2006.

Net sales for the six months ended June 29, 2007 were $132.9 million, compared to $130.3 million for the first six months of 2006. Gross margin for the first six months of 2007 was $23.7 million, or 17.9%, compared to $19.2 million, or 14.8%, for the first six months of 2006. Income from continuing operations before income taxes for the first six months of 2007 was $3.2 million compared to a loss from continuing operations before income taxes of $2.5 million in the first six months of 2006. Income from continuing operations for the first half of 2007 was $1.9 million, or $0.31 per share, compared to a loss from continuing operations of $1.5 million, or $0.25 per share, for the first six months of 2006. Net income was $2.2 million for the first six months of 2007, or $0.36 per share, compared to a net loss of $0.5 million, or $0.09 per share, for the first six months of 2006. EBITDA was $5.7 million for the first six months of 2007 compared to $1.1 million for the first six months of 2006.

During the second quarter, Nashua tendered 751,150 shares at a price of $10.50, which was paid on July 6, 2007. Nashua also reported that following the tender offer the repurchase of up to 384,571 shares of common stock remained authorized under the stock repurchase program announced in November 2006. Nashua also completed its refinancing during the second quarter of 2007, which provides a term loan of $10 million and a revolving line of credit for $28 million.

Thomas Brooker, President and Chief Executive Officer of Nashua Corporation, stated, “The year-to-year progress on both sales and net income reflects the Company’s focus on top-line growth and continued expense control. Expansion of the sales force has led to increased opportunities and success in existing and new accounts. The restructuring and consolidations which occurred last year have provided us with a cost structure which should allow us to continue to grow profitably.”

2

Business Segment Highlights

Nashua’s Label segment, which prints and converts product for the grocery, food service, retail, transportation, entertainment and general industrial markets, reported net sales for the second quarter of 2007 of $28.4 million and gross margin of $5.3 million, or 18.5%. Net sales for the second quarter of 2006 were $26.7 million and gross margin was $3.8 million, or 14.3%.

Sales for the Label Products segment increased 6.4% on a quarter-to-quarter basis. The increased sales were primarily attributable to increased volume in the automatic identification product line. Gross margins increased $1.5 million on a quarter-to-quarter basis. The increase is attributable to the volume increase and lower manufacturing expenses. The prior year’s results included $0.1 million of expenses related to the shut down of the St. Louis Label plant.

Nashua’s Specialty Paper segment, which includes the paper coating and converting businesses, produces a wide range of applications for labeling, packaging, ticketing and point of sale transactions, thermal, dry gum and heal-seal products for use in the transportation, retail, gaming, shipping and delivery, entertainment, medical and distribution industries. The Specialty Paper segment reported net sales for the second quarter of 2007 of $40.0 million and gross margin of $6.8 million, or 17.1%. Net sales for the second quarter of 2006 were $39.7 million and gross margin was $5.5 million, or 13.9%.

Sales for the Specialty Paper segment increased slightly on a quarter-to-quarter basis. The increase was mainly attributable to increased sales of coated thermal films and thermal products sold for point of sale applications. The increased sales were partially offset by lower sales of financial products such as ATM receipts and imaging supply products. Margins increased by $1.3 million on a quarter-to-quarter basis due to lower material cost and lower manufacturing expenses. The margins for 2006 included $0.5 million of expenses related to the space consolidation in our Merrimack, New Hampshire facility and $0.2 million of severance expense.

Use of Non-GAAP Measures

EBITDA is presented as supplemental information that the management of Nashua believes may be useful to some investors in evaluating the Company because it is widely used as a measure of evaluating a company’s operating performance, as well as to evaluate its operating cash flow. EBITDA is used by management in the computation of ratios utilized for financing purposes and for planning and forecasting in future periods. EBITDA is calculated by adding net interest expense, income tax expense, depreciation and amortization back into net income. EBITDA should not be considered a substitute either for net income, as an indicator of Nashua’s operating performance, or for cash flow, as a measure of Nashua’s liquidity. In addition, because all companies may not calculate EBITDA in exactly the same manner, the presentation here may not be comparable to other similarly titled measures of other companies.

About Nashua

Nashua Corporation manufactures and markets a wide variety of specialty imaging products and services to industrial and commercial customers to meet various print application needs. The Company’s products include thermal coated papers, pressure-sensitive labels, colored copier papers, bond, point of sale, ATM and wide format papers, entertainment tickets, as well as ribbons for use in imaging devices. Additional information about Nashua Corporation can be found at www.nashua.com.

3

Forward-looking Statements

This press release contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. When used in this press release, the words “plan,” “should,” “will,” “expects,” “anticipates” and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated. Such risks and uncertainties include, but are not limited to, the Company’s future capital needs and resources, fluctuations in customer demand, intensity of competition from other vendors, timing and acceptance of new product introductions, delays or difficulties in programs designed to increase sales and profitability, general economic and industry conditions, and other risks set forth in the Company’s filings with the Securities and Exchange Commission, and the information set forth herein should be read in light of such risks. In addition, any forward-looking statements represent the Company’s estimates only as of the date of this press release and should not be relied upon as representing the Company’s estimates as of any subsequent date. While the Company may elect to update forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so, even if its estimates change.

Second Quarter 2007 Earnings Results

NASHUA CORPORATION SUMMARY RESULTS OF OPERATIONS

Periods ended June 29 and June 30, respectively	Three Months						Six Months
Dollars in thousands, except per share amounts (Unaudited)	2007			2006			2007			2006
Net sales	$	67,688		$	65,458		$	132,857		$	130,269
Cost of products sold		55,390			56,000			109,110			111,023
Gross margin	$	12,298		$	9,458		$	23,747		$	19,246
Gross margin %		18.2	%		14.5	%		17.9	%		14.8	%
Selling, distribution and administrative expenses		10,258			10,740			20,438			21,316
Research and development expenses		171			193			445			394
Loss from equity investment		69			105			140			119
Interest expense, net		36			294			148			601
Other income (1)		(331	)		(296	)		(615	)		(658	)
Income (loss) from cont ops before income taxes (benefit)		2,095			(1,578	)		3,191			(2,526	)
Income tax provision (benefit)		843			(596	)		1,302			(981	)
Income (loss) from continuing operations		1,252			(982	)		1,889			(1,545	)
Income from discontinued operations, net of taxes(2)		—			—			289			1,004
Net income (loss)	$	1,252		$	(982	)	$	2,178		$	(541	)
Earnings per share:
Income (loss) from continuing operations	$	0.21		$	(0.16	)	$	0.31		$	(0.25	)
Income from discontinued operations		—			—			0.05			0.16
Net income (loss) per common share	$	0.21		$	(0.16	)	$	0.36		$	(0.09	)
Average common shares		6,069			6,126			6,105			6,124
Income (loss) per common share from continuing operations assuming dilution	$	0.20		$	(0.16	)	$	0.30		$	(0.25	)
Income per common share from discontinued operations assuming dilution		—			—			0.05			0.16
Net income (loss) per common share assuming dilution	$	0.20		$	(0.16	)	$	0.35		$	(0.09	)
Average common and potential common shares		6,139			6,126			6,171			6,124

(1)

Other income for the three and six months ended June 29, 2007 represents income from the deferred gain from the sale of real estate and royalty income related to the 2006 sale of toner formulations. Othe income for the three and six months ended June 30, 2006 represents income from the rental of unused warehouse space at our New Hampshire facilities.

(2)

Income from discontinued operations for the six months ended June 29, 2007 represents the reimbursement of our deductible related to the Cerion litigation which was dismissed by the courts. Income from discontinued operations for the six months ended June 30, 2006 includes the results of our Toner and Developer business which we exited effective March 31, 2006 and income from the liquidation of an inactive foreign subsidiary.

Second Quarter 2007 Earnings Results

NASHUA CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS

	(Unaudited)
	June 29			December 31
Dollars in thousands	2007			2006
Assets
Cash and cash equivalents	$	9,947		$	289
Accounts receivable		29,900			29,568
Inventories		21,515			23,764
Other current assets		2,610			2,670
Total current assets		63,972			56,291
Plant and equipment, net		24,641			26,399
Goodwill, net of amortization		31,516			31,516
Intangibles, net of amortization		419			606
Other assets		13,044			12,803
Total assets	$	133,592		$	127,615
Liabilities and Shareholders’ Equity
Accounts payable	$	13,881		$	16,620
Tender offer obligation		7,887			—
Accrued expenses		10,356			8,639
Current maturities of long-term debt		—			—
Current maturities of notes payable		83			83
Total current liabilities		32,207			25,342
Long-term debt		12,800			4,750
Notes payable		243			285
Other long-term liabilities		25,400			28,211
Total long-term liabilities		38,443			33,246
Common stock and additional capital		19,883			22,342
Retained earnings		57,732			61,358
Accumulated other comprehensive loss:
Minimum pension liability adjustment(a)		(14,673	)		(14,673	)
Total shareholders’ equity		62,942			69,027
Total liabilities and shareholders’ equity	$	133,592		$	127,615

^(a) Our minimum pension liability adjustment represents an decrease in our minimum pension liability resulting from changes to our pension plans in 2006.

Second Quarter 2007 Earnings Results

NASHUA CORPORATION
RECONCILIATION OF NET INCOME FROM CONTINUING OPERATIONS TO EARNINGS BEFORE
INTEREST, TAXES, DEPRECIATION AND AMORTIZATION

Periods ended June 29 and June 30, respectively	Three Months					Six Months
In thousands (Unaudited)	2007		2006			2007		2006
Net income from continuing operations	$	1,252	$	(982	)	$	1,889	$	(1,545	)
Add back:
Interest expense, net		36		294			148		601
Income tax provision (benefit)		843		(596	)		1,302		(981	)
Depreciation on fixed assets		1,099		1,332			2,231		2,739
Amortization of intangible assets		50		165			137		328
Earnings from continuing operations before interest, taxes, depreciation and amortization	$	3,280	$	213		$	5,707	$	1,142

Second Quarter 2007 Earnings Results

NASHUA CORPORATION SELECTED FINANCIAL DATA

Periods ended June 29 and June 30, respectively	Three Months						Six Months
Dollars in thousands (Unaudited)	2007			2006			2007			2006
NET SALES
Label Products	$	28,448		$	26,700		$	56,667		$	52,982
Specialty Paper Products		40,030			39,667			78,067			78,954
All Other		1,097			827			2,005			1,488
Reconciling Items:
Eliminations		(1,887	)		(1,736	)		(3,882	)		(3,155	)
Net sales	$	67,688		$	65,458		$	132,857		$	130,269
GROSS MARGIN
Label Products	$	5,273		$	3,822		$	10,326		$	7,185
Specialty Paper Products		6,826			5,513			13,150			11,795
All Other		199			123			309			266
Reconciling Items:
Eliminations		—			—			(38	)		—
Total gross margin from continuing operations	$	12,298		$	9,458		$	23,747		$	19,246
DEPRECIATION AND AMORTIZATION
Label Products	$	516		$	498		$	1,055		$	1,055
Specialty Paper Products		506			620			1,018			1,267
Reconciling Item:
Corporate		127			379			295			745
Total depreciation and amortization	$	1,149		$	1,497		$	2,368		$	3,067
INVESTMENT IN PLANT AND EQUIPMENT
Label Products	$	59		$	172		$	107		$	352
Specialty Paper Products		150			698			342			1,172
Reconciling Item:
Corporate		16			140			54			152
Total Investment in plant and equipment	$	225		$	1,010		$	503		$	1,676
PENSION AND POSTRETIREMENT EXPENSE
Label Products	$	79		$	207		$	157		$	391
Specialty Paper Products		58			171			117			342
Reconciling Item:
Corporate		225			409			450			871
Total pension and postretirement expense	$	362		$	787		$	724		$	1,604