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Ennis Business Forms Reports Q1 Results: Revenue of $57 Million

Press release from the issuing company

DESOTO, Texas--June 13, 2002--Ennis Business Forms, Inc. today reported operating results for its first quarter ended May 31, 2002. "Considering the ongoing softness and uncertainty in our economy, we are satisfied with the operating results in the first quarter," Keith Walters, Chairman, CEO and President of Ennis Business Forms, Inc. stated. "We continue to keep our internal focus of building cross-selling opportunities among our three groups and keeping costs in line in order to better position us as the economy improves and keep the Company as one of the forms industry's most profitable companies." The performance of our three groups was impacted by the general weakness in the economy in the first quarter. The Forms Solutions Group's revenues and profits continue to be impacted by both the general economy and industry decline. For the first quarter ended May 31, 2002, net sales amounted to $57,743,000 compared to $59,823,000 for the same period last year, a decrease of 3.5%. Net earnings for the quarter amounted to $3,300,000 or $.20 per diluted share, compared to $3,408,000, or $.21 per diluted share for the corresponding period last year, a decrease of 3.2%. Per share earnings computations were based on 16,493,293 shares for the quarter compared to 16,299,564 shares for the corresponding prior period. In the current fiscal year, effective March 1, 2002, the Company adopted the provisions of Statement 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, first quarter diluted earnings per share would have been $0.22 in the prior year. Specifically, the 3.5% decrease in net sales in the first quarter ended May 31, 2002 as compared to the same period last year resulted from a decrease in the consolidated net sales contribution from the Forms and Promotional Solutions Groups of 2.3% and 1.7%, respectively. This was mitigated by a .5% increase in contribution to consolidated net sales from the Financial Solutions Group. The decrease in operating results for the first quarter is principally due to fixed cost under absorption issues primarily in the Forms and Promotional Solutions Groups due to the decline in revenues as noted above. This was somewhat mitigated by the continued reduction of interest expense due to the repayment of debt issued to finance the Northstar acquisition.

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