UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~May~~August 31, 2015

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ____________.

Commission file number: 0-4957

EDUCATIONAL DEVELOPMENT CORPORATION

(Exact name of registrant as specified in its charter)

Delaware		73-0750007
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

10302 East 55th Place, Tulsa, Oklahoma		74146-6515
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (918) 622-4522

Indicate by check mark whether the registrant (1) has filed all reports to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer”, “accelerated filer”, and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer o	Accelerated filer o

Non-accelerated filer o	Smaller reporting company x

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of ~~July 10,~~October 2, 2015, there were ~~4,047,202~~4,057,364 shares of Educational Development Corporation Common Stock, $0.20 par value outstanding.

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TABLE OF CONTENTS

		Page
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	10
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	1416
Item 4.	Controls and Procedures	1416

PART II. OTHER INFORMATION
Item 1.	Legal Proceedings	1517
Item 1A.	Risk Factors	1517
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	1517
Item 3.	Defaults Upon Senior Securities	1517
Item 4.	Mine Safety Disclosures	1517
Item 5.	Other Information	1517
Item 6.	Exhibits	1518

Signatures		1619

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

EDUCATIONAL DEVELOPMENT CORPORATION

CONDENSED BALANCE SHEETS (UNAUDITED)

	May 31, 2015			February 28, 2015
ASSETS							August 31, 2015			February 28, 2015

CURRENT ASSETS:
Cash and cash equivalents	$	371,400		$	383,900		$	312,100		$	383,900
Accounts receivable, less allowance for doubtful accounts and sales returns of $365,800 (May 31) and $334,500 (February 28)		3,058,200			3,076,700
Accounts receivable, less allowance for doubtful accounts and sales returns of $397,700 (August 31) and $334,500 (February 28)								4,164,100			3,076,700
Inventories—Net		12,922,000			11,181,000			13,356,000			11,181,000
Prepaid expenses and other assets		407,800			374,200			422,500			374,200
Deferred income taxes		257,700			249,800			255,900			249,800
Total current assets		17,017,100			15,265,600			18,510,600			15,265,600

INVENTORIES—Net		358,600			350,800			304,500			350,800

PROPERTY, PLANT AND EQUIPMENT—Net		2,158,700			2,073,200			2,403,900			2,073,200

OTHER ASSETS		243,400			243,400			243,400			243,400
DEFERRED INCOME TAXES		75,700			80,200			68,800			80,200
TOTAL ASSETS	$	19,853,500		$	18,013,200		$	21,531,200		$	18,013,200

LIABILITIES AND SHAREHOLDERS’ EQUITY

CURRENT LIABILITIES:
Accounts payable	$	3,449,400		$	2,237,700		$	4,571,600		$	2,237,700
Line of credit		1,700,000			1,400,000			1,350,000			1,400,000
Accrued salaries and commissions		912,000			618,100			1,394,800			618,100
Income taxes payable		202,500			63,600			293,500			63,600
Dividends payable		323,000			322,000			364,400			322,000
Other current liabilities		891,100			1,043,500			854,300			1,043,500
Total current liabilities		7,478,000			5,684,900			8,828,600			5,684,900

COMMITMENTS

SHAREHOLDERS’ EQUITY:
Common stock, $0.20 par value; Authorized 8,000,000 shares; Issued 6,041,040 (May 31 and February 28) shares; Outstanding 4,037,572 (May 31) and 4,024,539 (February 28) shares		1,208,200			1,208,200
Common stock, $0.20 par value; Authorized 8,000,000 shares; Issued 6,041,040 (August 31 and February 28) shares; Outstanding 4,049,335 (August 31) and 4,024,539 (February 28) shares								1,208,200			1,208,200
Capital in excess of par value		8,548,000			8,548,000			8,548,000			8,548,000
Retained earnings		13,858,800			13,857,200			14,138,800			13,857,200
		23,615,000			23,613,400			23,895,000			23,613,400
Less treasury stock, at cost		(11,239,500	)		(11,285,100	)		(11,192,400	)		(11,285,100	)
Total shareholders' equity		12,375,500			12,328,300			12,702,600			12,328,300
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	19,853,500		$	18,013,200		$	21,531,200		$	18,013,200

See notes to condensed financial statements.

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EDUCATIONAL DEVELOPMENT CORPORATION

CONDENSED STATEMENTS OF EARNINGS (UNAUDITED)

	Three Months Ended May 31,						Three Months Ended August 31,						Six Months Ended August 31,
	2015			2014			2015			2014			2015			2014

GROSS SALES	$	13,303,100		$	10,720,400		$	17,685,600		$	11,335,200		$	30,988,700		$	22,055,600
Discounts and allowances		(4,207,600	)		(3,801,900	)		(5,994,500	)		(4,811,200	)		(10,202,100	)		(8,613,100	)
Transportation revenue		542,300			259,800			915,700			284,200			1,458,000			544,000
NET REVENUES		9,637,800			7,178,300			12,606,800			6,808,200			22,244,600			13,986,500
COST OF SALES		3,573,800			2,843,500			4,577,400			3,013,100			8,151,200			5,856,600
Gross margin		6,064,000			4,334,800			8,029,400			3,795,100			14,093,400			8,129,900

OPERATING EXPENSES:
Operating and selling		2,723,300			2,058,600			3,395,400			2,065,700			6,118,700			4,124,300
Sales commissions		2,314,600			1,419,900			3,060,800			1,177,200			5,375,400			2,597,100
General and administrative		484,400			472,300			512,500			532,800			996,900			1,005,100
Total operating expenses		5,522,300			3,950,800			6,968,700			3,775,700			12,491,000			7,726,500

OTHER INCOME (EXPENSE)		(10,000	)		3,600
OTHER EXPENSE								(21,700	)		(11,100	)		(31,700	)		(7,500	)

EARNINGS BEFORE INCOME TAXES		531,700			387,600			1,039,000			8,300			1,570,700			395,900

INCOME TAXES		207,100			147,900			394,600			12,200			601,700			160,100

NET EARNINGS	$	324,600		$	239,700		$	644,400		$	(3,900	)	$	969,000		$	235,800

BASIC AND DILUTED EARNINGS PER SHARE:
Basic	$	0.08		$	0.06		$	0.16		$	(0.00	)	$	0.24		$	0.06
Diluted	$	0.08		$	0.06		$	0.16		$	(0.00	)	$	0.24		$	0.06


DIVIDENDS PER SHARE	$	0.08		$	0.08		$	0.09		$	0.08		$	0.17		$	0.16

WEIGHTED AVERAGE NUMBER OF COMMON AND EQUIVALENT SHARES OUTSTANDING:
Basic		4,010,830			3,986,561			4,045,219			3,998,170			4,039,055			3,992,365
Diluted		4,010,830			3,986,561			4,045,219			3,998,170			4,039,055			3,992,365

See notes to condensed financial statements.

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EDUCATIONAL DEVELOPMENT CORPORATION

CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY (UNAUDITED)

FOR THE ~~THREE~~SIX MONTHS ENDED ~~May~~AUGUST 31, 2015

	Common Stock																		Common Stock
	(par value $0.20 per share)																		(par value $0.20 per share)
	Number of				Capital in					Treasury Stock									Number of				Capital in					Treasury Stock
	Shares				Excess of		Retained			Number of						Shareholders’			Shares				Excess of		Retained			Number of						Shareholders’
	Issued		Amount		Par Value		Earnings			Shares			Amount			Equity			Issued		Amount		Par Value		Earnings			Shares			Amount			Equity


BALANCE—March 1, 2015		6,041,040	$	1,208,200	$	8,548,000	$	13,857,200			2,016,501		$	(11,285,100	)	$	12,328,300			6,041,040	$	1,208,200	$	8,548,000	$	13,857,200			2,016,501		$	(11,285,100	)	$	12,328,300
Purchases of treasury stock		-		-		-		-			59			(200	)		(200	)		-		-		-		-			59			(200	)		(200	)
Sales of treasury stock		-		-		-		-			(13,092	)		45,800			45,800			-		-		-		-			(24,855	)		92,900			92,900
Dividends declared ($.08/share)		-		-		-		(323,000	)		-			-			(323,000	)
Dividends paid ($.08/share)																				-		-		-		(323,000	)		-			-			(323,000	)
Dividends declared ($.09/share)																				-		-		-		(364,400	)		-			-			(364,400	)
Net earnings		-		-		-		324,600			-			-			324,600			-		-		-		969,000			-			-			969,000
BALANCE— May 31, 2015		6,041,040	$	1,208,200	$	8,548,000	$	13,858,800			2,003,468		$	(11,239,500	)	$	12,375,500
BALANCE— August 31, 2015																				6,041,040	$	1,208,200	$	8,548,000	$	14,138,800			1,991,705		$	(11,192,400	)	$	12,702,600

See notes to condensed financial statements.

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EDUCATIONAL DEVELOPMENT CORPORATION

CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE ~~THREE~~SIX MONTHS ENDED ~~MAY~~AUGUST 31,

	2015			2014			2015			2014

CASH FLOWS FROM OPERATING ACTIVITIES:	$	82,800		$	(484,200	)	$	927,800		$	(2,429,500	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property, plant and equipment		(118,900	)		(87,100	)		(397,300	)		(114,300	)

Net cash used in investing activities		(118,900	)		(87,100	)		(397,300	)		(114,300	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Cash paid to acquire treasury stock		(200	)		(4,400	)		(200	)		(4,400	)
Cash received from sales of treasury stock		45,800			42,300			92,900			85,500
Borrowings under revolving credit agreement		300,000			475,000			1,550,000			2,900,000
Payments under revolving credit agreement								(1,600,000	)		(400,000	)
Dividends paid		(322,000	)		(318,200	)		(645,000	)		(637,400	)

Net cash provided by financing activities		23,600			194,700
Net cash (used in) provided by financing activities								(602,300	)		1,943,700

NET DECREASE IN CASH AND CASH EQUIVALENTS		(12,500	)		(376,600	)		(71,800	)		(600,100	)

CASH AND CASH EQUIVALENTS—BEGINNING OF PERIOD		383,900			680,000			383,900			680,000

CASH AND CASH EQUIVALENTS—END OF PERIOD	$	371,400		$	303,400		$	312,100		$	79,900

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest	$	15,800		$	1,300		$	43,400		$	20,000
Cash paid for income taxes	$	71,500		$	205,700		$	366,600		$	326,500

See notes to condensed financial statements.

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NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

Note 1 – The information shown with respect to the three and six months ended ~~May~~August 31, 2015 and 2014, which is unaudited, includes all adjustments which in the opinion of Management are considered to be necessary for a fair presentation of earnings for such periods. The adjustments reflected in the financial statements represent normal recurring adjustments. The results of operations for the three and six months ended ~~May~~August 31, 2015 and 2014 are not necessarily indicative of the results to be expected at year end due to seasonality of the product sales.

These financial statements and notes are prepared pursuant to the rules and regulations of the Securities and Ex-change Commission for interim reporting and should be read in conjunction with the audited financial statements and accompanying notes contained in our annual report on Form 10-K for the fiscal year ended February 28, 2015.

Note 2 – ~~At May 31, 2015, the rate in effect under our previous agreement was 4.00%. The revolving credit agreement was collateralized by substantially all of our assets.~~

We had $1,700,000 in borrowings outstanding on the revolving credit agreement at May 31, 2015 and $1,400,000 in borrowings at February 28, 2015. Available credit under the previous revolving credit agreement was $1,500,000 at May 31, 2015.

We had $1,350,000 in borrowings outstanding on our revolving credit agreement at August 31, 2015 and $1,400,000 in borrowings at February 28, 2015. Available credit under the revolving credit agreement was $2,650,000 at August 31, 2015.

This agreement also contains a provision for our use of the Bank’s letters of credit. The Bank agrees to issue, or obtain issuance of commercial or stand-by letters of credit provided that no letters of credit will have an expiry date later than June 30, 2016, and that the sum of the line of credit plus the letters of credit would not exceed the borrowing base in effect at the time. The agreement contains provisions that require us to maintain specified financial ratios, restrict transactions with related parties, prohibit mergers or consolidation, disallow additional debt, and limit the amount of compensation, salaries, investments, capital expenditures and leasing transactions. For the quarter ended ~~May~~August 31, 2015, we had no letters of credit outstanding.

Note 3 – Inventories consist of the following:

	2015						2015
	May 31,			February 28,			August 31,			February 28,
Current:
Book inventory	$	12,947,000		$	11,206,000		$	13,381,000		$	11,206,000
Inventory valuation allowance		(25,000	)		(25,000	)		(25,000	)		(25,000	)

Inventories net–current	$	12,922,000		$	11,181,000		$	13,356,000		$	11,181,000

Non-current:
Book inventory	$	723,900		$	718,900		$	651,500		$	718,900
Inventory valuation allowance		(365,300	)		(368,100	)		(347,000	)		(368,100	)

Inventories net–non-current	$	358,600		$	350,800		$	304,500		$	350,800

Book inventory quantities in excess of what will be sold within the normal operating cycle, due to minimum order requirements of our primary supplier, are included in non-current inventory.

Significant portions of our inventory purchases are concentrated with an England-based publishing company. Purchases from this company were approximately ~~$4.4~~$4.1 million and ~~$3.3~~$3.4 million for the three months ended ~~May~~August 31, 2015 and 2014, respectively. Total inventory purchases from all suppliers were ~~$5.7~~$5.5 million and ~~$4.0~~$4.1 million for the three months ended ~~May~~August 31, 2015 and 2014, respectively.

Purchases from this company were approximately $8.5 million and $6.7 million for the year-to-date period ended August 31, 2015 and 2014, respectively. Total inventory purchases from all suppliers were $11.2 million and $8.1 million for the year-to-date period ended August 31, 2015 and 2014, respectively.

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Note 4 – Basic earnings per share (“EPS”) is computed by dividing net earnings by the weighted average number of common shares outstanding during the period. Diluted EPS is based on the combined weighted average number of common shares outstanding and dilutive potential common shares issuable which include, where appropriate, the assumed exercise of options. In computing diluted EPS we have utilized the treasury stock method. The computation of weighted average common and common equivalent shares used in the calculation of basic and diluted earnings per share (“EPS”) is shown below.

Earnings Per Share:
	Three Months Ended May 31,				Three Months Ended August 31,					Six Months Ended August 31,
	2015		2014		2015		2014			2015		2014

Net earnings	$	324,600	$	239,700	$	644,400	$	(3,900	)	$	969,000	$	235,800

Shares:

Weighted average shares outstanding - basic		4,010,830		3,986,561		4,045,219		3,998,170			4,039,055		3,992,365
Assumed exercise of options		-		-		-		-			-		-

Weighted average shares outstanding - diluted		4,010,830		3,986,561		4,045,219		3,998,170			4,039,055		3,992,365

Basic Earnings Per Share	$	0.08	$	0.06	$	0.16	$	(0.00	)	$	0.24	$	0.06
Diluted Earnings Per Share	$	0.08	$	0.06	$	0.16	$	(0.00	)	$	0.24	$	0.06

Stock options not considered above because they were antidilutive		10,000		10,000		10,000		10,000			10,000		10,000

Our Board of Directors has adopted a stock repurchase plan in which we may purchase up to a total of 3,000,000 shares as market conditions warrant. This plan has no expiration date. During the ~~three~~six months ended ~~May~~August 31, 2015, we purchased 59 shares of common stock. The maximum number of shares that can be repurchased in the future is 303,256.

Note 5 – We account for stock-based compensation whereby share-based payment transactions with employees, such as stock options and restricted stock, are measured at estimated fair value at date of grant and recognized as compensation expense over the vesting period. No such transactions occurred in the three and six months ended ~~May~~August 31, 2015 and 2014.

Note 6 – Outbound freight and handling costs incurred are included in operating and selling expenses and were ~~$1,057,400~~$1,547,700 and ~~$740,700~~$799,200 for the three months ended ~~May~~August 31, 2015 and 2014, respectively. These costs were $2,605,100 and $1,539,900 for the six months ended August 31, 2015 and 2014, respectively.

Note 7 – We have two reportable segments: EDC Publishing and Usborne Books & More (“UBAM”). These reportable segments are business units that offer different methods of distribution to different types of customers. They are managed separately based on the fundamental differences in their operations. EDC Publishing markets its products to retail accounts, which include book, school supply, toy and gift stores and museums, through commissioned sales representatives, trade and specialty wholesalers and an internal telesales group. UBAM markets its products through a network of independent sales consultants using a combination of direct sales, home shows, book fairs and internet web sales.

The accounting policies of the segments are the same as those of the rest of the Company. We evaluate segment performance based on earnings before income taxes of the segments, which is defined as segment net sales reduced by cost of sales and direct expenses. Corporate expenses, depreciation, interest expense and income taxes are not allocated to the segments, but are listed in the “other” row below. Corporate expenses include the executive department, accounting department, information services department, general office management and building facilities management. Our assets and liabilities are not allocated on a segment basis.

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Information by industry segment for the ~~three-month~~three and six-month periods ended ~~May~~August 31, 2015 and 2014, follows:

NET REVENUES	NET REVENUES					NET REVENUES

		Three Months Ended May 31, 2015					Three Months Ended August 31,				Six Months Ended August 31,
		2015		2014			2015		2014		2015		2014
EDC Publishing		$	2,619,600	$	2,763,900		$	3,674,100	$	3,260,100	$	6,293,700	$	6,024,000
UBAM			7,018,200		4,414,400			8,932,700		3,548,100		15,950,900		7,962,500
Total		$	9,637,800	$	7,178,300		$	12,606,800	$	6,808,200	$	22,244,600	$	13,986,500

EARNINGS BEFORE INCOME TAXES	EARNINGS BEFORE INCOME TAXES							EARNINGS BEFORE INCOME TAXES

		Three Months Ended May 31, 2015							Three Months Ended August 31,						Six Months Ended August 31,
		2015			2014					2015			2014			2015			2014
EDC Publishing		$	718,600		$	809,300			$	1,248,100		$	965,400		$	1,966,700		$	1,774,700
UBAM			952,000			615,400				1,084,600			154,100			2,036,600			769,500
Other			(1,138,900	)		(1,037,100	)			(1,293,700	)		(1,111,200	)		(2,432,600	)		(2,148,300	)
Total		$	531,700		$	387,600			$	1,039,000		$	8,300		$	1,570,700		$	395,900

Note 8– The Financial Accounting Standards Board (“FASB”) periodically issues new accounting standards in a continuing effort to improve standards of financial accounting and reporting. We have reviewed the recently issued pronouncements and concluded that the following recently issued accounting standards apply to us.

In May 2014, FASB issued ASU No. 2014-09, and amended with ASU No. 2015-14 “Revenue from Contracts with Customers,” which provides a single revenue recognition model which is intended to improve comparability over a range of industries, companies and geographical boundaries and will also result in enhanced disclosures. The changes are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017, which means the first quarter of our fiscal year 2019. We are currently reviewing the ASU and assessing the potential impact on our financial statements.

Note 9– The valuation hierarchy included in U.S. GAAP considers the transparency of inputs used to value assets and liabilities as of the measurement date. A financial instrument's classification within the valuation hierarchy is based on the lowest level of input that is significant to its fair value measurement. The three levels of the valuation hierarchy and the classification of our financial assets and liabilities within the hierarchy are as follows:

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level 2 - Observable inputs other than quoted prices included within Level 1 for the asset or liability, either directly or indirectly. If an asset or liability has a specified term, a Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3 - Unobservable inputs for the asset or liability.

We do not report any assets or liabilities at fair value in the financial statements. However, the estimated fair value of our line of credit is estimated by management to approximate the carrying value of ~~$1,700,000~~$1,350,000 at ~~May~~August 31, 2015, and $1,400,000 at February 28, 2015. Management's estimates are based on the obligation’s characteristics, including a floating interest rate, maturity, and collateral. Such valuation inputs are considered a Level 2 measurement in the fair value valuation hierarchy.

Note 10 – On ~~June 19,~~September 18, 2015, we paid the previously declared ~~$0.08~~$0.09 dividend per share to shareholders of record as of ~~June 12,~~September 11, 2015.

Note 11 – We are currently exploring opportunities to expand our operations into a larger facility to provide additional warehouse and office capacity to accommodate our growth. As a result, a letter of intent was signed on October 2, 2015 to sell our current facility, which has a carrying value of $1,509,900. This transaction is expected to be finalized during this fiscal year.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Factors Affecting Forward Looking Statements

MD&A contains statements that are forward-looking and include numerous risks which you should carefully consider. Additional risks and uncertainties can also materially and adversely affect our business. You should read the following discussion in connection with our condensed financial statements, including the notes to those statements, included in this document. Our fiscal years end on February 28.

Overview

We operate two separate divisions, EDC Publishing and Usborne Books & More (“UBAM”), to sell the Usborne and Kane Miller lines of children’s books. These two divisions each have their own customer base. The EDC Publishing markets its products on a wholesale basis to various retail accounts. UBAM markets its products to individual consumers as well as school and public libraries.

The following table shows statements of earnings data as a percentage of net revenues.

	Earnings as a Percent of Net Revenues
Earnings as a Percent of Net Revenues							Earnings as a Percent of Net Revenues
	Three Months Ended May 31,							Three Months Ended August 31,						Six Months Ended August 31,
	2015			2014				2015			2014			2015			2014
Net revenues		100.0	%		100.0	%			100.0	%		100.0	%		100.0	%		100.0	%
Cost of sales		37.1	%		39.6	%			36.3	%		44.3	%		36.6	%		41.9	%
Gross margin		62.9	%		60.4	%			63.7	%		55.7	%		63.4	%		58.1	%
Operating expenses:
Operating and selling		28.3	%		28.7	%			26.9	%		30.3	%		27.5	%		29.5	%
Sales commissions		24.0	%		19.8	%			24.3	%		17.3	%		24.2	%		18.6	%
General and administrative		5.0	%		6.6	%			4.1	%		7.9	%		4.5	%		7.2	%
Total operating expenses		57.3	%		55.1	%			55.3	%		55.5	%		56.2	%		55.3	%
Other income (expense)		(0.1	)%		0.1	%			-0.2	%		-0.1	%		-0.1	%		0.0	%
Earnings before income taxes		5.5	%		5.4	%			8.2	%		0.1	%		7.1	%		2.8	%
Income taxes		2.1	%		2.1	%			3.1	%		0.2	%		2.7	%		1.1	%
Net earnings		3.4	%		3.3	%			5.1	%		-0.1	%		4.4	%		1.7	%

Operating Results for the Three Months Ended ~~May~~August 31, 2015

We earned income before income taxes of ~~$531,700~~$1,039,000 for the three months ended ~~May~~August 31, 2015, compared with ~~$387,600~~$8,300 for the three months ended ~~May~~August 31, 2014.

Revenues

For the Three Months Ended May 31,
2015 2014 $ Change % Change
Gross sales $ 13,303,100 $ 10,720,400 $ 2,582,700 24.1
Less discounts and allowances (4,207,600 ) (3,801,900 ) (405,700 ) 10.7
Transportation revenue 542,300 259,800 282,500 108.7
Net revenues $ 9,637,800 $ 7,178,300 $ 2,459,500 34.3

	For the Three Months Ended August 31,
	2015			2014			$ Change			% Change
Gross sales	$	17,685,600		$	11,335,200		$	6,350,400			56.0
Less discounts and allowances		(5,994,500	)		(4,811,200	)		(1,183,300	)		24.6
Transportation revenue		915,700			284,200			631,500			222.2
Net revenues	$	12,606,800		$	6,808,200		$	5,798,600			85.2

UBAM’s gross sales increased ~~$2,818,900~~$5,478,100 during the three-month period ending ~~May~~August 31, 2015, when compared with the same quarterly period a year ago. This increase resulted from increases of:

~~204%~~·

379% in internet sales,

~~24%~~·

57% in school and library sales,

~~25%~~·

34% in home party sales,

~~13%~~·

11% in ~~direct~~fundraiser sales and

9%·

3% in ~~fundraiser~~direct sales.

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The increase ~~is also attributed to a 32% increase in the number of active consultants (those with sales during the six-month period ending) at May 31, 2015 when compared to May 31, 2014.~~

~~The increase~~ in internet sales is attributed to a ~~193%~~387% increase in the total number of orders, ~~and~~offset by a ~~3% increase~~2% decrease in average order size. This significant increase in the total number of orders is a result of the ~~growth~~increase in the number of sales consultants and their use of social media ~~by sales consultants~~ to conduct online events such as virtual home parties.

The increase in school and library sales is attributed to a ~~24%~~60% increase in the total number of ~~orders.~~orders and a 14% increase in the average order size. Much of this change is a result of the increase in the number of sales consultants.

The increase in home party sales is attributed to a ~~94%~~181% increase in the total number of orders, offset by a ~~36%~~52% decrease in average order size. Much of this change is a result of the increase in the number of sales consultants.

The increase in fundraiser sales is attributed to a 27% increase in the total number of orders, partially offset by a 12% decrease in the average order size.

The increase in direct sales is attributed to a ~~20%~~62% increase ~~in the average order size, partially offset by a 5% decrease~~ in the total number of ~~orders.~~

~~The increase in fundraiser sales is attributed to an 8% increase~~orders, partially offset by a 36% decrease in the average order ~~size and a 1% increase in total number of orders.~~size.

EDC Publishing’s gross sales ~~decreased $236,200~~increased $872,300 during the three-month period ending ~~May~~August 31, 2015, when compared with the same quarterly period a year ago. We attribute this to a ~~43% decrease~~35% increase in sales to major national accounts, offset by ~~a 15% increase~~an 11% decrease in sales to smaller retail stores. This ~~decrease~~increase in sales to major national accounts was due in part to timing of reorders.

UBAM’s discounts and allowances were ~~$1,247,700~~$1,958,700 and ~~$748,700~~$1,232,400 for the quarterly periods ended ~~May~~August 31, 2015 and 2014, respectively. UBAM is a multi-level selling organization that markets its products through independent sales representatives (“consultants”). Sales are made to individual purchasers and school and public libraries. Gross sales in UBAM are based on the retail sales prices of the products. As a part of UBAM’s varied marketing programs, discounts relevant to the particular program are offered. The discounts and allowances in UBAM will vary from year-to-year depending on the marketing programs in place during any given period. The UBAM’s discounts and allowances were ~~16.1%~~19.6% and ~~15.2%~~27.3% of UBAM’s gross sales for the quarterly periods ended ~~May~~August 31, 2015 and 2014, respectively.

EDC Publishing’s discounts and allowances are a much larger percentage of gross sales than discounts and allowances in UBAM due to the different customer markets that each division targets. EDC Publishing’s discounts and allowances were ~~$2,959,900~~$4,035,800 and ~~$3,053,200~~$3,578,800 for the quarterly periods ended ~~May~~August 31, 2015 and 2014, respectively. EDC Publishing sells to retail book chains, regional and local bookstores, toy and gift stores, school supply stores and museums. To be competitive with other wholesale book distributors, EDC Publishing sells at discounts between 48% and 55% of the retail sales prices of the products, based upon the quantity of books ordered and the dollar amount of the order. EDC Publishing’s discounts and allowances were ~~53.1% and 52.6%~~52.4% of EDC Publishing’s gross sales for each of the quarterly periods ended ~~May~~August 31, 2015 and ~~May~~August 31, ~~2014, respectively.~~2014.

Transportation revenue increased to ~~$542,300~~$915,700 from ~~$259,800~~$284,200 when comparing the quarterly period ended ~~May~~August 31, 2015, to the same period in 2014. Transportation revenues primarily relate to UBAM and are based on a percentage of the total order, with a per-order minimum charge which we increased ~~since the quarterly period ended May 31,~~in September 2014.

Expenses

	For the Three Months Ended May 31,								For the Three Months Ended August 31,
	2015		2014		$ Change		% Change		2015		2014		$ Change			% Change
Cost of sales	$	3,573,800	$	2,843,500	$	730,300		25.7	$	4,577,400	$	3,013,100	$	1,564,300			51.9
Operating and selling		2,723,300		2,058,600		664,700		32.3		3,395,400		2,065,700		1,329,700			64.4
Sales commissions		2,314,600		1,419,900		894,700		63.0		3,060,800		1,177,200		1,883,600			160.0
General and administrative		484,400		472,300		12,100		2.6		512,500		532,800		(20,300	)		(3.8	)
Total	$	9,096,100	$	6,794,300	$	2,301,800		33.9	$	11,546,100	$	6,788,800	$	4,757,300			70.1

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Cost of sales increased ~~25.7%~~51.9% for the three months ended ~~May~~August 31, 2015, when compared with the three months ended ~~May~~August 31, 2014. Cost of sales as a percentage of gross sales were ~~26.9%~~25.9% and ~~26.5%~~26.6%, respectively, for each of the three-month periods ended ~~May~~August 31, 2015 and 2014, respectively. Cost of sales is the inventory cost of the product sold, which includes the cost of the product itself and inbound freight charges. Purchasing and receiving costs, inspection costs, warehousing costs, and other costs of our distribution network are included in operating and selling expenses, not in cost of sales. These costs totaled ~~$342,100~~$404,900 in the quarter ended ~~May~~August 31, 2015, and ~~$301,200~~$288,600 in the quarter ended ~~May~~August 31, 2014.

In addition to costs associated with our distribution network (noted above), operating and selling costs include expenses of ~~EDC~~the Publishing Division, the UBAM Division and the order entry and customer service functions. Operating and selling expenses as a percentage of gross sales were ~~20.5% for the quarter ended May 31, 2015 and~~ 19.2% for the quarter ended ~~May~~August 31, 2015, and 18.2% for the quarter ended August 31, 2014.

Sales commissions in ~~EDC~~the Publishing ~~increased 9.9%~~Division decreased 1.2% to ~~$90,300~~$101,100 for the three months ended ~~May~~August 31, 2015, when compared with the same quarterly period a year ago. ~~EDC~~ Publishing Division sales commissions are paid on net sales and were ~~3.4%~~2.8% of net sales for the quarter ended ~~May~~August 31, 2015 and ~~3.0%~~3.1% for the quarter ended ~~May~~August 31, 2014. Sales commissions in ~~EDC~~the Publishing Division fluctuate depending upon the amount of sales made to our house accounts, which are ~~EDC Publishing’s~~the Publishing Division’s largest customers and do not have any commission expense associated with them, and sales made by our outside sales representatives.

Sales commissions in the UBAM Division increased ~~66.3%~~175.3% to ~~$2,224,300~~$2,959,700 for the three months ended ~~May~~August 31, 2015, when compared with the same quarterly period a year ago, primarily due to the increase in net sales for the same period. UBAM Division sales commissions were ~~28.8%~~29.6% of gross sales for the three months ended ~~May~~August 31, 2015, and ~~27.2%~~23.8% of gross sales for the three months ended ~~May~~August 31, 2014. The fluctuation in the percentages of commission expense to gross sales is the result of the type of sale. Home shows, book fairs, school and library sales, and direct sales have different commission rates. Also contributing to the fluctuations in the percentages is the payment of overrides and bonuses, both dependent on consultants’ monthly sales and downline sales.

Our effective tax rate was ~~39.0%~~38.0% for the quarter ended ~~May~~August 31, 2015 and ~~38.2%~~147.0% for the quarter ended ~~May~~August 31, 2014. These rates are higher than the federal statutory rate due to the inclusion of state income and franchise taxes.

Operating Results for the Six Months Ended August 31, 2015

We earned income before income taxes of $1,570,700 for the six months ended August 31, 2015 compared with $395,900 for the six months ended August 31, 2014.

Revenues

	For the Six Months Ended August 31,
	2015			2014			$ Change			% Change
Gross sales	$	30,988,700		$	22,055,600		$	8,933,100			40.5
Less discounts and allowances		(10,202,100	)		(8,613,100	)		(1,589,000	)		18.4
Transportation revenue		1,458,000			544,000			914,000			168.0
Net revenues	$	22,244,600		$	13,986,500		$	8,258,100			59.0

UBAM’s gross sales increased $8,297,000 during the six-month period ending August 31, 2015, when compared with the same period a year ago. This increase resulted from increases of:

303% in internet sales,

35% in school and library sales,

30% in home party sales,

10% in fundraiser sales and

8% in direct sales.

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The increase in internet sales is attributed to a 297% increase in the total number of orders and a 3% increase in average order size. This significant increase in the total number of orders is a result of the increase in the number of sales consultants and their use of social media to conduct online events such as virtual home parties.

The increase in school and library sales is attributed to a 35% increase in the total number of orders. Much of this change is a result of the increase in the number of sales consultants.

The increase in home party sales is attributed to a 140% increase in the total number of orders, offset by a 45% decrease in average order size. Much of this change is a result of the increase in the number of sales consultants.

The increase in fundraiser sales is attributed to a 9% increase in the average order size and a 1% increase in total number of orders.

The increase in direct sales is attributed to a 39% increase in the total number of orders, partially offset by a 23% decrease in the average order size.

EDC Publishing’s gross sales increased $636,100 during the six-month period ending August 31, 2015, when compared with the same period a year ago. We attribute this to a 0.9% increase in sales to major national accounts, offset by a 0.3% decrease in sales to smaller retail stores. This increase in sales to major national accounts was due in part to timing of reorders.

UBAM’s discounts and allowances were $3,206,400 and $1,981,100 for the six-month periods ended August 31, 2015 and 2014, respectively. UBAM is a multi-level selling organization that markets its products through independent sales representatives (“consultants”). Sales are made to individual purchasers and school and public libraries. Gross sales in UBAM are based on the retail sales prices of the products. As a part of UBAM’s varied marketing programs, discounts relevant to the particular program are offered. The discounts and allowances in UBAM will vary from year-to-year depending on the marketing programs in place during any given period. The UBAM’s discounts and allowances were 18.1% and 21.0% of UBAM’s gross sales for the six-month periods ended August 31, 2015 and 2014, respectively.

EDC Publishing’s discounts and allowances are a much larger percentage of gross sales than discounts and allowances in UBAM due to the different customer markets that each division targets. EDC Publishing’s discounts and allowances were $6,995,700 and $6,632,000 for the six-month periods ended August 31, 2015 and 2014, respectively. EDC Publishing sells to retail book chains, regional and local bookstores, toy and gift stores, school supply stores and museums. To be competitive with other wholesale book distributors, EDC Publishing sells at discounts between 48% and 55% of the retail sales prices of the products, based upon the quantity of books ordered and the dollar amount of the order. EDC Publishing’s discounts and allowances were 52.7% and 52.5% of EDC Publishing’s gross sales for the six-month periods ended August 31, 2015 and August 31, 2014, respectively.

Transportation revenue increased to $1,458,000 from $544,000 when comparing the year-to-date period ended August 31, 2015, to the same period in 2014. Transportation revenues primarily relate to UBAM and are based on a percentage of the total order, with a per-order minimum charge which we increased in September 2014.

Expenses

	For the Six Months Ended August 31,
	2015		2014		$ Change			% Change
Cost of sales	$	8,151,200	$	5,856,600	$	2,294,600			39.2
Operating and selling		6,118,700		4,124,300		1,994,400			48.4
Sales commissions		5,375,400		2,597,100		2,778,300			107.0
General and administrative		996,900		1,005,100		(8,200	)		(0.8	)
Total	$	20,642,200	$	13,583,100	$	7,059,100			52.0

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Cost of sales increased 39.2% for the six months ended August 31, 2015, when compared with the six months ended August 31, 2014. Cost of sales as a percentage of gross sales were 26.3% and 26.6%, respectively, for each of the six-month periods ended August 31, 2015 and 2014, respectively. Cost of sales is the inventory cost of the product sold, which includes the cost of the product itself and inbound freight charges. Purchasing and receiving costs, inspection costs, warehousing costs, and other costs of our distribution network are included in operating and selling expenses, not in cost of sales. These costs totaled $747,000 in the six-month period ended August 31, 2015 and $589,800 in the six-month period ended August 31, 2014.

In addition to costs associated with our distribution network (noted above), operating and selling costs include expenses of the Publishing Division, the UBAM Division and the order entry and customer service functions. Operating and selling expenses as a percentage of gross sales were 19.7% for the six-month period ended August 31, 2015, and 18.7% for the six-month period ended August 31, 2014.

Sales commissions in the Publishing Division increased 3.7% to $191,400 for the six months ended August 31, 2015, when compared with the same six-month period a year ago. Publishing Division sales commissions are paid on net sales and were 3.0% of net sales for the six-month period ended August 31, 2015 and 3.1% for the six-month period ended August 31, 2014. Sales commissions in the Publishing Division fluctuate depending upon the amount of sales made to our house accounts, which are the Publishing Division’s largest customers and do not have any commission expense associated with them, and sales made by our outside sales representatives.

Sales commissions in the UBAM Division increased 114.9% to $5,184,000 for the six months ended August 31, 2015, when compared with the same period a year ago, primarily due to the increase in net sales for the same period. UBAM Division sales commissions were 29.3% of gross sales for the six months ended August 31, 2015, and 25.6% of gross sales for the six months ended August 31, 2014. The fluctuation in the percentages of commission expense to gross sales is the result of the type of sale. Home shows, book fairs, school and library sales, and direct sales have different commission rates. Also contributing to the fluctuations in the percentages is the payment of overrides and bonuses, both dependent on consultants’ monthly sales and downline sales.

Our effective tax rate was 38.3% for the six-month period ended August 31, 2015 and 40.4% for the six-month period ended August 31, 2014. These rates are higher than the federal statutory rate due to the inclusion of state income and franchise taxes.

Liquidity and Capital Resources

Our primary source of cash is typically operating cash flow. Typically, our primary uses of cash are to pay dividends, repurchase outstanding shares of stock, and ~~purchase property and equipment.~~capital expenditures. We utilize our bank credit facility to meet our short-term cash needs when necessary.

For the ~~three-month~~six-month period ended ~~May~~August 31, 2015, we experienced cash flow from operating activities of ~~$82,800.~~$927,800. Cash flow from operating activities resulted primarily from an increase in certain current liabilities of ~~$1,353,100,~~$2,921,400, net income after taxes of ~~$324,600,~~$969,000, an increase in net income taxes payable of ~~$138,900,~~$229,900, and a decrease in ~~accounts receivable~~deferred income taxes of ~~$18,400.~~$5,300. These were offset by an increase in inventory of ~~$1,748,800, related~~$2,128,700 due to ~~new catalog titles and~~a build-up of inventory related to increased sales and in anticipation of the busy fall-selling season, an increase in accounts receivable of $1,087,400 and an increase in certain prepaid expenses and other current assets of ~~$33,600, and an increase in deferred income taxes of $3,400.~~$48,300.

Cash used in investing activities was ~~$118,900~~$397,300 for the ~~three-month~~six-month period ended ~~May~~August 31, 2015. This was for capital expenditures related to the on-going implementation of our data processing systems. ~~We estimate that total cash used in investing activities for fiscal year 2015 will be less than $500,000. This would consist primarily of the cost of implementing our new data processing systems.~~

For the ~~three-month~~six-month period ended ~~May~~August 31, 2015, cash ~~provided by~~used in financing activities was ~~$23,600, resulting from~~$602,300, due to payments on our revolving credit agreement of $1,600,000, dividend payments of $645,000, and the purchase of $200 of treasury stock. This was offset by borrowings under our revolving credit agreement of ~~$300,000~~$1,550,000 and $92,900 of proceeds from the sale ~~of $45,800 of treasury stock, offset by dividend payments of $322,000, and the purchase of $200~~ of treasury stock.

We believe that in fiscal year 2016 we will experience overall positive cash flow and that this positive cash flow along with the bank credit facility will be adequate to meet our liquidity requirements for the foreseeable future.

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We have a history of profitability and positive cash flow. We can sustain planned operating levels with minimal capital requirements. Consequently, cash generated from operations is used to liquidate any existing debt, pay capital distributions through dividends or repurchase shares outstanding.

Our Board of Directors has adopted a stock repurchase plan in which we may purchase up to a total of 3,000,000 shares as market conditions warrant. Management believes the stock is undervalued and when stock becomes available at an attractive price, we will utilize free cash flow to repurchase shares. Management believes this enhances the value to the remaining stockholders and that these repurchases will have no adverse effect on our short-term and long-term liquidity. We repurchased 59 shares at a cost of $200 during the ~~three-month~~six-month period ended ~~May~~August 31, 2015. The maximum number of shares that can be repurchased in the future is 303,256.

~~At May 31, 2015, the rate in effect under our previous agreement was 4.00%. The revolving credit agreement was collateralized by substantially all of our assets.~~

Effective July 7, 2015, we signed a Nineteenth Amendment to the Credit and Security Agreement with Arvest Bank (the Bank) which provides a $4,000,000 line of credit through June 30, 2016. Interest is payable monthly at the prime rate. At August 31, 2015, the rate in effect under our revolving credit agreement was 3.25%. It was collateralized by substantially all of our assets.

We had $1,350,000 in borrowings outstanding on the revolving credit agreement at August 31, 2015, and $1,400,000 in borrowings at February 28, 2015. Available credit under the revolving credit agreement was $2,650,000 at August 31, 2015.

This agreement also contains a provision for our use of the Bank’s letters of credit. The Bank agrees to issue, or obtain issuance of commercial or stand-by letters of credit provided that no letters of credit will have an expiry date later than June 30, 2016 and that the sum of the line of credit plus the letters of credit would not exceed the borrowing base in effect at the time. The agreement contains provisions that require us to maintain specified financial ratios, restrict transactions with related parties, prohibit mergers or consolidation, disallow additional debt, and limit the amount of compensation, salaries, investments, capital expenditures and leasing transactions. For the ~~quarter~~period ended ~~May~~August 31, 2015, we had no letters of credit outstanding.

As of ~~May~~August 31, 2015, we did not have any commitments in excess of one year.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. On an on-going basis, we evaluate our estimates, including those related to our valuation of inventory, allowance for uncollectible accounts receivable, allowance for sales returns, long-lived assets and deferred income taxes. We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual results may materially differ from these estimates under different assumptions or conditions. Historically, however, actual results have not differed materially from those determined using required estimates. Our significant accounting policies are described in the notes accompanying the financial statements included elsewhere in this report. However, we consider the following accounting policies to be more significantly dependent on the use of estimates and assumptions.

Revenue Recognition

Sales are recognized and recorded when products are shipped. Products are shipped FOB shipping point. The UBAM Division’s sales are paid at the time the product is shipped. These sales accounted for ~~72.8%~~71.7% of net revenues for the ~~three-month~~six-month period ended ~~May~~August 31, 2015, and ~~61.5%~~56.9% for the ~~three-month~~six-month period ended ~~May~~August 31, 2014.

Estimated allowances for sales returns are recorded as sales are recognized and recorded. Management uses a moving average calculation to estimate the allowance for sales returns. We are not responsible for product damaged in transit. Damaged returns are primarily from retail stores. These returns relate to damage that occurs in the stores, not in shipping to the stores. It is industry practice to accept returns from wholesale customers. Transportation revenue, the amount billed to the customer for shipping the product, is recorded when products are shipped. Management has estimated and included a reserve for sales returns of $100,000 as of ~~May~~August 31, 2015 and February 28, 2015.

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Allowance for Doubtful Accounts

We maintain an allowance for estimated losses resulting from the inability of our customers to make required payments. An estimate of uncollectable amounts is made by management based upon historical bad debts, current customer receivable balances, age of customer receivable balances, the customer's financial condition and current economic trends. If the actual uncollected amounts significantly exceed the estimated allowance, then our operating results would be significantly adversely affected. Management has estimated and included an allowance for doubtful accounts of ~~$95,400~~$83,800 at ~~May~~August 31, 2015, and $108,100 at February 28, 2015.

Inventory

Management continually estimates and calculates the amount of non-current inventory. Non-current inventory arises due to the purchase of book inventory in quantities in excess of what will be sold within the normal operating cycle due to minimum order requirements of our primary supplier. Non-current inventory was estimated by management using the current year turnover ratio by title. Then all inventory in excess of 2 ½ years of anticipated sales is classified as non-current inventory. Non-current inventory balances, before valuation allowance, were ~~$723,900~~$651,500 at ~~May~~August 31, 2015 and $718,900 at February 28, 2015.

Inventories are presented net of a valuation allowance. Management has estimated and included a valuation allowance for both current and non-current inventory. This allowance is based on management’s identification of slow moving inventory on hand. Management has estimated a valuation allowance for both current and non-current inventory of ~~$390,300~~$372,000 and $393,100 as of ~~May~~August 31, 2015 and February 28, 2015, respectively.

Stock-Based Compensation

We account for stock-based compensation whereby share-based payment transactions with employees, such as stock options and restricted stock, are measured at estimated fair value at date of grant and recognized as compensation expense over the vesting period.

~~ITEM~~Item 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

~~ITEM~~Item 4.CONTROLS AND PROCEDURES

An evaluation was performed of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(e) and 15d-15(e) as of ~~May~~August 31, 2015. This evaluation was conducted under the supervision and with the participation of our management, including our Chief Executive Officer and our Controller/Corporate Secretary (Principal Financial and Accounting Officer).

Based on that evaluation, these officers concluded that our disclosure controls and procedures were effective pursuant to Exchange Act Rule 13a-15(e).

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PART II. OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

Not Applicable.

Item 1A. RISK FACTORS

Not required by smaller reporting company.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table shows repurchases of our Common Stock during the quarter ended ~~May~~August 31, 2015:

ISSUER PURCHASES OF EQUITY SECURITIES

Period
Total # of Shares
Purchased

Average Price
Paid per Share

Total # of Shares
Purchased as
Part of Publicly Announced Plan (1)

Maximum # of Shares that May
be Repurchased under the Plan
(2) (3)

March 1 - 31, 2015 59 $ 4.12 59 303,256
April 1 -30, 2015 0 N/A 0 303,256
May 1 - 31, 2015 0 N/A 0 303,256
Total 59 $ 4.12 59

Period	Total # of Shares Purchased		Average Price Paid per Share		Total # of Shares Purchased as Part of Publicly Announced Plan (1)		Maximum # of Shares that May be Repurchased under the Plan (2) (3)

June 1 - 30, 2015		0		N/A		0		303,256
July 1 -32, 2015		0		N/A		0		303,256
August 1 - 31, 2015		0		N/A		0		303,256
Total		0		N/A		0

(1)	All of the shares of common stock set forth in this column were purchased pursuant to a publicly announced plan as described in footnote 2 below.

(2)	In April 2008 the Board of Directors authorized us to purchase up to an additional 500,000 shares of our common stock under a repurchase plan. Pursuant to the plan, we may purchase a total of ~~303,356~~303,256 additional shares of our common stock until 3,000,000 shares have been repurchased.

(3)	There is no expiration date for the repurchase plan.

Item 3. DEFAULTS UPON SENIOR SECURITIES

Not Applicable.

Item 4. MINE SAFETY DISCLOSURES

None.

Item 5. OTHER INFORMATION

None.

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Item 6. EXHIBITS

31.1	Certification of the Chief Executive Officer of Educational Development Corporation pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 furnished herewith.


31.2	Certification of Controller and Corporate Secretary (Principal Financial and Accounting Officer) of Educational Development Corporation pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 furnished herewith.


32.1	Certification pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS	XBRL Instance Document

101.SCH	XBRL Taxonomy Extension Schema Document

101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF	XBRL Taxonomy Extension Definition Linkbase Document

101.LAB	XBRL Taxonomy Extension Label Linkbase Document

101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	EDUCATIONAL DEVELOPMENT CORPORATION
	(Registrant)

Date: October 7, 2015	By:	/s/ Randall W. White
		Randall W. White
		President

~~EDUCATIONAL DEVELOPMENT CORPORATION~~

~~(Registrant)~~

~~Date:~~ ~~July 15, 2015~~ By ~~/s/ Randall W. White~~

~~Randall W. White~~

~~President~~

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EXHIBIT INDEX

~~Exhibit No~~. ~~Description~~

Exhibit No.	Description

31.1	Certification of the Chief Executive Officer of Educational Development Corporation pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 furnished herewith.


31.2	Certification of Controller and Corporate Secretary (Principal Financial and Accounting Officer) of Educational Development Corporation pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 furnished herewith.


32.1	Certification pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS	XBRL Instance Document

101.SCH	XBRL Taxonomy Extension Schema Document

101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF	XBRL Taxonomy Extension Definition Linkbase Document

101.LAB	XBRL Taxonomy Extension Label Linkbase Document

101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document

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