Midlothian, TX -- Ennis, Inc. (the “Company”), today reported financial results for the first quarter ended May 31, 2023. Highlights include:

• Revenues were $111.3 million for the quarter compared to $107.7 million for the same quarter last year, an increase of $3.6 million or 3.3%.
• Earnings per diluted share for the current quarter were $0.45 compared to $0.45 for the comparative quarter last year.
• Our gross profit margin for the quarter was 30.6% compared to 31.6% for the comparative quarter last year.

Financial Overview
The Company’s revenues for the first quarter ended May 31, 2023 were $111.3 million compared to $107.7 million for the same quarter last year, an increase of $3.6 million, or 3.3%. The increase includes revenue contributions of approximately $4.1 million from School Photo Marketing, an acquisition completed on November 30, 2022, and Stylecraft Printing Company, an acquisition completed on May 23, 2023. The increase from acquisitions was partially offset by an otherwise slight decline in sales volume as purchasing patterns have normalized since last year’s tight paper market. Gross profit margin was $34.0 million, or 30.6%, as compared to $34.0 million, or 31.6%, for the same quarter last year. Net earnings for the quarter remained flat at $11.6 million, or $0.45 per diluted share, as compared to $11.6 million, or $0.45 per diluted share, for the same quarter last year. Our recent acquisitions contributed $0.04 in diluted earnings per share for the quarter.

Keith Walters, Chairman, Chief Executive Officer and President, commented by stating, “Our results for the quarter were within our expectations. Our gross profit margin for the quarter of 30.6% is within our target range and showed improvement of 300 basis points from 27.6% in the sequential quarter ending February 28, 2023 and declined 100 basis points to 30.6% compared to 31.6% in the same prior year quarter. Our EBITDA remained relatively stable at $20.5 million or 18.4% of sales compared to the sequential quarter, $20.5 million or 19.9% of sales and compared to the same quarter last year $20.5 million or 19.1% of sales.

"We incurred additional expenses this quarter in which we anticipate the benefits to be recognized in future quarters. We relocated one of our leased facilities into an existing location with excess capacity. The lease renewal would have been an increase of 70% and the move to an existing location is anticipated to reduce future costs and improve our operational efficiency. We incurred additional legal expenses during the quarter related to a case against Wright Printing Company, its owner Mark Wright, and CEO Mardra Sikora. In April 2023, we were awarded $5.0 million in actual and punitive damages but the judgment award has not been recognized in our financials to date. These additional expenses for the quarter resulted in a decrease of $0.03 to our diluted earnings per share.

"Our recent acquisitions contributed $4.1 million in sales during the current quarter; however, the real impact of our latest acquisitions is expected to be seen in the remainder of fiscal year 2024. Stylecraft Printing Company in Canton, Michigan expands our product lines and geographical footprint, as well as adds a well-known brand that has been serving the distributor channel for more than 50 years. UMC Print, a leading trade-only printer acquired after the quarter close, June 2, 2023, will add strategic locations & capabilities to drive growth with our distributor partners. We will continue to explore acquisitions that make sense and hunt for new sales in new markets and new channels. As part of our regular course of business we continue to monitor incoming order volumes so that we can proactively adjust our costs accordingly.

"We believe we have one of the strongest balance sheets in the industry, with no debt and significant cash. Our profitability and strong financial condition will allow us to continue operations and fund acquisitions without incurring debt. Given those strengths, we also anticipate timely access to credit should larger acquisition opportunities materialize. We continue to focus on delivering profitability and returns to our shareholders."

Non-GAAP Reconciliations
To provide important supplemental information to both management and investors regarding financial and business trends used in assessing its results of operations, from time to time the Company reports the non-GAAP financial measure of EBITDA (EBITDA is calculated as net earnings before interest expense, tax expense, depreciation, and amortization). The Company may also report adjusted gross profit margin, adjusted earnings and adjusted diluted earnings per share, each of which is a non-GAAP financial measure.

Management believes that these non-GAAP financial measures provide useful information to investors as a supplement to reported GAAP financial information. Management reviews these non-GAAP financial measures on a regular basis and uses them to evaluate and manage the performance of the Company’s operations. Other companies may calculate non-GAAP financial measures differently than the Company, which limits the usefulness of the Company’s non-GAAP measures for comparison with these other companies. While management believes the Company’s non-GAAP financial measures are useful in evaluating the Company, when this information is reported it should be considered as supplemental in nature and not as a substitute or an alternative for, or superior to, the related financial information prepared in accordance with GAAP. These measures should be evaluated only in conjunction with the Company’s comparable GAAP financial measures.

In Other News
On June 16, 2023 the Board of Directors declared a quarterly cash dividend of 25.0 cents per share on the Company’s common stock. The dividend is payable on August 7, 2023 to shareholders of record on July 7, 2023.