HOUSTON, Aug. 2 -- Consolidated Graphics, Inc. today announced financial results for its first quarter ended June 30, 2006.
Revenue for the June quarter was $238.4 million, up 14% compared to $209.9 million a year ago. Net income for the June quarter was $13.7 million, or $.97 per diluted share, representing increases of 57% and 59% compared to net income of $8.7 million and diluted earnings per share of $.61 a year ago. Revenues, net income and diluted earnings per share this quarter were at record quarterly levels for Consolidated Graphics. The June quarter results included share-based compensation expense of $.8 million after tax, or $.06 per diluted share, resulting from the adoption of SFAS No. 123R effective April 1, 2006, and also a one-time reduction of income tax expense of $.7 million, or $.05 per diluted share, reflecting the cumulative benefit of a net reduction in state income tax rates.
"We are very pleased to report these record results," commented Joe R. Davis, Chairman and Chief Executive Officer. "Our sales growth is being driven by strong contributions from multiple strategies, including national accounts, CGXSolutions, investment in new technology and acquisitions. This sales growth plus our ongoing focus on purchasing advantages and operating efficiencies has enabled continued strong improvement in operating margins, which rose to 9.4% in the June quarter from 7.3% a year ago, and translated into an accelerated rate of net income and diluted earnings per share growth."
Mr. Davis added, "We continue to use our strong balance sheet and cash flow to leverage and expand our strategic advantages and for the benefit of enhanced shareholder return. In the June quarter, we made net capital expenditures of $7.2 million and spent $7.4 million to repurchase 147,500 shares of our common stock, while also paying down our outstanding debt by $1.5 million. Our acquisition efforts are reflected in an expanding pipeline of opportunities in addition to the previously announced letter of intent to acquire Global Group Inc. located in Fort Worth, Texas."
Mr. Davis concluded, "For the September quarter, we expect to achieve continued strong revenue and profit growth over the prior year. We project quarterly revenues to increase 10% from the prior year to $244 million, with diluted earnings per share increasing 48% to $.98. These projected results do not include any contribution from prospective acquisitions."
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