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Visant Reports 2013 and Q4 Results

Thursday, March 06, 2014

Press release from the issuing company

ARMONK, N.Y. - VISANT CORPORATION today announced results for its fiscal year ended December 28, 2013, including consolidated net sales of $1,127.7 million, compared to $1,155.3 million for its fiscal year endedDecember 29, 2012, a decrease of approximately 2.4%.  Visant reported consolidated net income of $1.1 million for the fiscal year ended December 28, 2013, compared to a consolidated net loss of $58.6 million for the fiscal year ended December 29, 2012.  The 2013 fiscal year results include an $8.2 million non-cash charge associated with the write-off of a tradename no longer in use in the Marketing and Publishing Services segment and the 2012 fiscal year results included a $64.2 million non-cash impairment charge associated with the write-down of goodwill in the Marketing and Publishing Services and Scholastic segments.  Visant's consolidated Adjusted EBITDA (defined in the accompanying summary of financial data) was $284.8 millionfor the 2013 fiscal year, a decrease of $13.3 million, compared to consolidated Adjusted EBITDA of $298.1 million for the 2012 fiscal year.

For the fourth fiscal quarter of 2013, consolidated net sales were $226.7 million, an increase of approximately 0.8%, compared to consolidated net sales of $225.0 million for the fourth fiscal quarter of 2012.  In addition, the Company reported a consolidated net loss of $13.7 million for the fourth quarter of 2013 compared to a consolidated net loss of $85.6 million for the fourth quarter of 2012.  The net loss in 2013 includes the $8.2 million write-off of a tradename no longer in use in the Marketing and Publishing Services segment and the net loss in 2012 was primarily attributable to the $64.2 million non-cash impairment charge recorded in 2012 associated with the write-down of goodwill in the Marketing and Publishing Services and Scholastic segments.  Consolidated Adjusted EBITDA was $33.3 million for the fourth quarter of 2013 compared to consolidated Adjusted EBITDA of $35.9 million for the fourth quarter of 2012.

Fiscal Year 2013

Net sales for the Scholastic segment for the fiscal year ended December 28, 2013 decreased by $13.9 million, or 3.1%, to$431.9 million compared to $445.8 million for the fiscal year ended December 29, 2012.  This decrease was primarily attributable to lower volume in our high school jewelry and announcement products.  Partially offsetting the decrease was the shift of approximately $4.0 million of jewelry sales to the 2013 fiscal year from the fall of 2012 due to the timing of orders. 

Net sales for the Memory Book segment were $331.3 million for the fiscal year ended December 28, 2013, a decrease of 4.3%, compared to $346.1 million for the fiscal year ended December 29, 2012.  This decrease was primarily attributable to 3.6% lower yearbook volume. 

Net sales for the Marketing and Publishing Services segment increased to $365.0 million for the fiscal year ended December 28, 2013 compared to $364.3 million for the fiscal year ended December 29, 2012.  This increase included sales attributable to the Company's acquisition of SAS Carestia ("Carestia"), a leader in fragrance sampling in Europe, which closed on July 1, 2013.  Excluding the impact attributable to the acquisition of Carestia, net sales declined $9.5 million compared to the fiscal year ended December 29, 2012, primarily due to lower sampling volume in North America, partially offset by higher revenues from our Latin American sampling operations and our direct mail operations.

The Scholastic segment reported Adjusted EBITDA of $74.6 million for the fiscal year ended December 28, 2013, an increase of$2.1 million, compared to $72.5 million for the fiscal year ended December 29, 2012.  This increase was primarily due to lower overall costs, including lower selling expenses, material costs and pension expense, partially offset by lower sales volume in high school jewelry and announcement products.

Our Memory Book segment reported Adjusted EBITDA of $140.1 million for the fiscal year ended December 28, 2013, a decrease of $3.6 million, compared to $143.7 million for the fiscal year ended December 29, 2012.  This decrease was primarily due to lower yearbook volume partially offset by lower overall costs as a result of cost saving initiatives and lower pension expense.

The Marketing and Publishing Services segment reported Adjusted EBITDA of $70.1 million for the fiscal year ended December 28, 2013, a decrease of $11.8 million, compared to $81.9 million for the prior year comparative period.  This decrease was primarily due to lower volume and unfavorable sales mix in our sampling business.  

Fourth Fiscal Quarter 2013

Net sales for the Scholastic segment were $114.7 million for the fourth fiscal quarter of 2013 compared to $120.7 million for the fourth fiscal quarter of 2012.  This decrease was primarily attributable to lower volume of high school jewelry products.

Net sales for the Memory Book segment were $14.8 million for the fourth fiscal quarter of 2013 compared to $16.5 million for the fourth fiscal quarter of 2012.  This decrease was primarily attributable to lower volume.

Net sales for the Marketing and Publishing Services segment for the fourth fiscal quarter of 2013 increased $9.3 million to $97.4 million from $88.1 million for the fourth fiscal quarter of 2012.  This increase included sales attributable to the Company's acquisition of Carestia.  Excluding the impact attributable to the acquisition of Carestia, the increase in net sales was $3.6 million compared to the fourth fiscal quarter of 2012, primarily due to higher sampling volume.   

Adjusted EBITDA for the Scholastic segment decreased $2.4 million to $18.8 million for the fourth fiscal quarter of 2013, compared to a $21.2 million for the fourth fiscal quarter of 2012, primarily due to lower sales volume.

Adjusted EBITDA for the Memory Book segment for the fourth fiscal quarter of 2013 was a loss of $3.2 million compared to a loss of $3.6 million for the fourth fiscal quarter of 2012.  This slight improvement in Adjusted EBITDA was primarily attributable to the impact of cost saving initiatives and lower pension expense.

The Marketing and Publishing Services segment reported Adjusted EBITDA of $17.7 million for the fourth fiscal quarter of 2013 compared to $18.4 million for the fourth fiscal quarter of 2012.  This decrease was primarily due to unfavorable sales mix in our sampling operations.

Consolidated Indebtedness

As of December 28, 2013, Visant's consolidated debt, comprised of the outstanding indebtedness under its senior secured credit facilities and its 10.00% senior notes due 2017, was $1,884.8 million, including $7.7 million of capital lease and equipment financing obligations and exclusive of original issue discount of $11.9 million related to the term loan under the senior secured credit facilities.  Visant's cash position as of December 28, 2013 totaled $96.0 million.

The Company had accrued approximately $14.6 million of interest under its senior notes and senior secured credit facilities as of December 28, 2013.  This amount was paid following the end of the fourth fiscal quarter.

Visant has provided a reconciliation of net income to Adjusted EBITDA and EBITDA to Adjusted EBITDA in the accompanying summary of financial data. 

Supplemental data has also been provided for Visant's three segments: Scholastic, Memory Book and Marketing and Publishing Services.

 

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