Ennis Reports Q2 Results: Lower Sales in Forms Solutions Group
Friday, September 13, 2002
DESOTO, Texas--Sept. 12, 2002--Ennis Business Forms, Inc. today reported operating results for its second quarter ended August 31, 2002. "The general weakness in the economy continues to impact the performance of our three groups," Keith Walters, Chairman, CEO and President of Ennis Business Forms, Inc. stated. "Our main focus continues to be building cross-selling opportunities and controlling costs, while positioning ourselves for growth as demonstrated in our recent letter of intent to acquire Calibrated Forms Co. Inc." Calibrated Forms Co. Inc. is a private business forms manufacturer located in Columbus, Kan. with approximately $43,000,000 in annual revenues. It is anticipated that the transaction will be for cash and will be accretive to earnings in the quarter it is acquired. The transaction is anticipated to close within 60 days. For the second quarter ended August 31, 2002, net sales amounted to $56,646,000 compared to $58,695,000 for the same period last year, a decrease of 3.5%. Net earnings for the quarter amounted to $3,817,000 or $.23 per diluted share, compared to $4,047,000, or $.25 per diluted share for the corresponding period last year, a decrease of 5.7%. Per share earnings computations were based on 16,499,106 shares for the quarter compared to 16,306,698 shares for the prior period. For the six months ended August 31, 2002, net sales amounted to $114,389,000 compared to $118,518,000 for the same period last year, a decrease of 3.5%. Net earnings for the six months amounted to $7,117,000 or $.43 per diluted share, compared to $7,455,000 or $.46 per diluted share for the corresponding period last year, a decrease of 4.5%. Per share earnings computations were based on 16,495,892 shares for the six months compared to 16,306,206 shares for the prior period. In the current fiscal year, effective March 1, 2002, the Company adopted the provisions of Statements of Financial Accounting Standard No. 142, "Goodwill and Other Intangible Assets" (SFAS No. 142). As a result of the adoption, which discontinued the amortization of goodwill, second quarter diluted earnings per share would have been $0.26 in the prior year and six month diluted earnings per share would have been $0.49 in the prior year. Specifically, the 3.5% decrease in net sales in the second quarter and six months ended August 31, 2002 as compared to the same period last year was primarily attributable to the reduction in sales from the Forms Solutions Group. The decrease in operating results for the second quarter and six months ended August 31, 2002 as compared to the same period last year is principally attributable to fixed cost under absorption issues in the Forms Solutions Group due to the decline in revenue noted above.