By Trevor Shackelford August 8, 2005 -- Standard Register (NYSE: SR) held their second quarter earnings call today. Revenue for the quarter was $225.5 million, up 2.1% from the same period last year. Net loss for the second quarter was $2.3 million, or $0.08 per share, versus a net loss of $2.6 million, or $0.09 per share, during the same period last year. The results were slightly higher than last year, but lower than most analysts’ expectations. Topics of this Summary Quarter Highlights Segment Performance Guidance Raine Radar Q & A Quarter Highlights The company plans to invest in print-on-demand to capitalize on the double digit market growth Sales, General, and Administrative costs down $7.6 million, or 9% to $65 million from the same period last year Gross margin down 1.7% Total debt down 59% to $41.1 million from $100.0 million last year Segment Performance Document and Label Solutions Revenue for the second quarter was $154.3 million, up 1.1% year over year. Print on Demand Revenue was $59.4 million, a decrease of 0.7%. Digital production saw increases, but traditional offset fell enough to eliminate the digital gains. InSystems Revenue was $3 million, up 1.2% for the quarter. The company continued to trim costs out of this segment of business during the second quarter. Other Revenue for all other products was $8.8 million, up 63% from last year, driven primarily by commercial print. The commercial print business experienced “solid growth” this quarter according to the company. Guidance Standard Register still expects “modest” revenue growth in 2005 compared to 2004. The company has indicated that it will likely fall short of its target of achieving a 5 point increase in pretax operating profit as a percentage of sales in the second half of 2005. Raine Radar The company remains committed to funding its electronic pen and paper despite a lack of any significant adoption since it was announced almost a year and a half ago. There are plenty of market opportunities for a document services company like SR to pursue without getting side-tracked. The company should consider its strategic options for the technology, including divestiture, to allow it to focus on expanding core competencies like print-on-demand. The market growth numbers are certainly compelling for digital printers, although competition is likely to continue to stiffen. R&D should be targeting more advanced print-on-demand, e-fulfillment, and content management offerings. These high value services allow you to move up the food chain while leveraging your commodity capabilities. Q & A The service component of print-on-demand is much more important to Standard Register than the production aspect of the business. The company will be investing in both talent and capital to improve the growth of the POD business. Standard Register sees color and variable color digital printing driving POD with double digit growth rates. Black and white digital POD has single digit growth rates, and short run offset is contracting. According to the company, the digital pen and paper pilots have been encouraging, and the company will continue to pursue the program.