Exhibit 99.1
FOR IMMEDIATE RELEASE
ENNIS, INC. REPORTS RECORD SALES AND PROFITS
FOR THE YEAR AND RESULTS FOR THE QUARTER ENDED FEBRUARY 29, 2008
Midlothian, Texas April 25, 2008 — Ennis, Inc. (the “Company”), (NYSE: EBF), today reported financial results for the quarter and the year ended February 29, 2008.
Highlights
| | | o Revenues for the year increased by $25.9 million over the last year, or 4.4%. |
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| | | o Net earnings increased by 7.2% for the year, from approximately $41.6 million to approximately $44.6 million. |
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| | | o Diluted EPS increased by 6.2%, from $1.62 per share to $1.72 per share for the year. Diluted EPS increased by 43.3%, from $.30 per share to $.43 per share for the quarter. |
Financial Overview
For the quarter, our net sales increased by $13.4 million, or 9.8%, from $136.1 million for the three months ended February 28, 2007 to $149.5 million for the three months ended February 29, 2008. Our Print sales for the quarter were $87.6 million, compared to $80.7 million for the same quarter last year, or an increase of 8.6%. Apparel sales for the quarter were $61.9 million, compared to $55.5 million for the same quarter last year, or an increase of 11.5%. Our overall gross profit margins (“margins”) during the quarter increased from 23.4% to 24.2% for the three months ended February 28, 2007 and February 29, 2008, respectively. Our Print margins increased from 25.0% to 27.6%, while the Apparel margins decreased from 21.1% to 19.4%, for the three months ended February 28, 2007 and February 29, 2008, respectively. Our earnings for the quarter increased 42.3% from $7.8 million for the three months ended February 28, 2007 to $11.1 million for the three months ended February 29, 2008. Diluted earnings per share (“EPS”) increased 43.3% from $.30 per share to $.43 per share for the three months ended February 28, 2007 and February 29, 2008, respectively.
Net sales increased from $584.7 million for the year ended February 28, 2007 to $610.6 million for year ended February 29, 2008, an increase of $25.9 million or 4.4%. Our Print sales for the year were $345.0 million, compared to $325.7 million for the same period last year, an increase of $19.3 million or 5.9%. Our Apparel sales increased from $259.0 million for the year ended February 28, 2007 to $265.6 million for the year ended February 29, 2008, an increase of $6.6 million, or 2.5%. Our Print margins increased from 25.2% to 27.2%, while our Apparel margins decreased from 24.7% to 22.2%, for the year ended February 28, 2007 and February 29, 2008, respectively. Our earnings for the period increased from $41.6 million for the year ended February 28, 2007 to $44.6 million for the year ended February 29, 2008. Diluted earnings increased from $1.62 per share to $1.72 per share for the year ended February 28, 2007 and February 29, 2008, respectively.
The Company, during the quarter, generated $21.5 million in EBITDA (earnings before interest, taxes, depreciation and amortization) compared to $18.3 million for the comparable quarter last year. For the year ending February 29, 2008, the Company generated $90.2 million in EBITDA compared to $90.4 million for the comparable period last year.
Reconciliation of Non-GAAP to GAAP measure (dollars in thousands):
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| | | Three months ended | | | Year ended | |
| | | February 29, | | | February 28, | | | February 29, | | | February 28, | |
| | | 2008 | | | 2007 | | | 2008 | | | 2007 | |
| Earnings before income taxes | | $ | 16,608 | | | $ | 12,723 | | | $ | 69,785 | | | $ | 66,365 | |
| Interest expense | | | 1,395 | | | | 1,573 | | | | 5,678 | | | | 6,936 | |
| Depreciation/amortization | | | 3,501 | | | | 4,030 | | | | 14,727 | | | | 17,078 | |
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| EBITDA (non-GAAP) | | $ | 21,504 | | | $ | 18,326 | | | $ | 90,190 | | | $ | 90,379 | |
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Keith Walters, Chairman, President & CEO, commented by saying, “We are extremely pleased with our results for the quarter and for the year, both from a revenue and EPS growth perspective. We are proud that we were able to return these excellent results to our shareholders, when others in our industries are having difficulties. We continue to see the positive impact of our cost reduction programs on our Print margins. We are also pleased with the continued increase in our Apparel sales during the quarter. Our Apparel margins this quarter were impacted by the increased cost of cotton; and while we increased selling prices to offset some of this increase, this did not fully absorb the entire extent of the cotton increase we experienced during this quarter. However, because of the increased volume, our Apparel operating profits actually increased this quarter over the same quarter last year. Overall, we feel good about how we finished up the year. We feel we addressed some of the key issues impacting our results during the first two quarters of this year quickly, and as a result had a strong finish to our fiscal year. Given the current economic climate, we see fiscal year 2009 being a challenging year as well, but I remain confident in our ability to navigate these challenging times as we have done in the past.”
About Ennis
Ennis, Inc. (www.ennis.com) is primarily engaged in the production of and sale of business forms, apparel and other business products. The Company is one of the largest private-label printed business product suppliers in the United States. Headquartered in Midlothian, Texas, the Company has production and distribution facilities strategically located throughout the United States of America, Mexico and Canada, to serve the Company’s national network of distributors. The Company, together with its subsidiaries, operates in two business segments: the Print Segment (“Print”) and Apparel Segment (“Apparel”). The Print Segment is primarily engaged in the business of manufacturing and selling business forms, other printed business products, printed and electronic media, presentation products, flex-o-graphic printing, advertising specialties and Post-it(R) Notes, internal bank forms, secure and negotiable documents, envelopes and other custom products. The Apparel Segment manufactures T-Shirts and distributes T-Shirts and other active-wear apparel through six distribution centers located throughout North America.
Safe Harbor Under The Private Securities Litigation Reform Act of 1995
Certain statements contained in this press release that are not historical facts are forward-looking statements that involve a number of known and unknown risks, uncertainties and other factors that could cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievement expressed or implied by such forward-looking statements. The words “anticipate,” “preliminary,” “expect,” “believe,” “intend” and similar expressions identify forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for such forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that a variety of factors could cause actual results and experience to differ materially from the anticipated results or other expectations expressed in such forward-looking statements. These statements are subject to numerous uncertainties, which include, but are not limited to, the Company’s ability to effectively manage its business functions while growing its business in a rapidly changing environment, the Company’s ability to adapt and expand its services in such an environment, the variability in the prices of paper and other raw materials. Other important information regarding factors that may affect the Company’s future performance is included in the public reports that the Company files with the Securities and Exchange Commission. The Company undertakes no obligation to revise any forward-looking statements or to update them to reflect events or circumstances occurring after the date of this release, or to reflect the occurrence of unanticipated events. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The inclusion of any statement in this release does not constitute an admission by the Company or any other person that the events or circumstances described in such statement are material.
For Further Information Contact:
Mr. Keith Walters, Chairman, Chief Executive Officer and President
Mr. Michael Magill, Executive Vice President
Mr. Richard L. Travis, Jr., Chief Financial Officer
Ennis, Inc.
2441 Presidential Parkway
Midlothian, Texas 76065
Phone: (972) 775-9801
Fax: (972) 775-9820
www.ennis.com
Ennis, Inc.
Condensed Financial Information
(In thousands, except per share amounts)
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| | | Three months ended | | | Twelve months ended | |
| | | February 29, | | | February 28, | | | February 29, | | | February 28, | |
| Condensed Operating Results | | 2008 | | | 2007 | | | 2008 | | | 2007 | |
| Revenues | | $ | 149,535 | | | $ | 136,139 | | | $ | 610,610 | | | $ | 584,713 | |
| Cost of goods sold | | | 113,319 | | | | 104,231 | | | | 457,963 | | | | 438,776 | |
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| Gross profit | | | 36,216 | | | | 31,908 | | | | 152,647 | | | | 145,937 | |
| Operating expenses | | | 18,109 | | | | 17,216 | | | | 76,867 | | | | 72,478 | |
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| Operating income | | | 18,107 | | | | 14,692 | | | | 75,780 | | | | 73,459 | |
| Other expense | | | 1,499 | | | | 1,969 | | | | 5,995 | | | | 7,094 | |
| Income tax expense | | | 5,520 | | | | 4,917 | | | | 25,195 | | | | 24,764 | |
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Net earnings | | $ | 11,088 | | | $ | 7,806 | | | $ | 44,590 | | | $ | 41,601 | |
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Earnings per share | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.43 | | | $ | 0.31 | | | $ | 1.74 | | | $ | 1.63 | |
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| Diluted | | $ | 0.43 | | | $ | 0.30 | | | $ | 1.72 | | | $ | 1.62 | |
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| | | February 29, | | | February 28, | |
| Condensed Balance Sheet Information | | 2008 | | | 2007 | |
| Current assets: | | | | | | | | |
| Cash | | $ | 3,393 | | | $ | 3,582 | |
| Accounts receivable, net | | | 72,278 | | | | 47,285 | |
| Inventories, net | | | 98,570 | | | | 85,696 | |
| Other | | | 11,578 | | | | 14,953 | |
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| | | | 185,819 | | | | 151,516 | |
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| Property, plant & equipment | | | 58,988 | | | | 63,057 | |
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| Other | | | 268,324 | | | | 263,655 | |
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| | | $ | 513,131 | | | $ | 478,228 | |
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| Current liabilities | | | | | | | | |
| Accounts payable | | $ | 29,658 | | | $ | 25,597 | |
| Accrued expenses | | | 21,913 | | | | 22,998 | |
| Current portion of long-term debt | | | 255 | | | | 652 | |
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| | | | 51,826 | | | | 49,247 | |
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| Long-term debt | | | 90,710 | | | | 88,971 | |
| Deferred credits | | | 22,116 | | | | 23,607 | |
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| Total liabilities | | | 164,652 | | | | 161,825 | |
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| Shareholders’ equity | | | 348,479 | | | | 316,403 | |
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| | | $ | 513,131 | | | $ | 478,228 | |
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| | | | | | | | | |
| | | February 29, | | | February 28, | |
| Condensed Cash Flow Information | | 2008 | | | 2007 | |
| Cash provided by operating activities | | $ | 30,444 | | | $ | 49,517 | |
| Cash used in investing activities | | | (17,285 | ) | | | (19,825 | ) |
| Cash used in financing activities | | | (13,516 | ) | | | (39,978 | ) |
| Effect of exchange rates on cash | | | 168 | | | | 8 | |
| | | | | | | |
| Change in cash | | | (189 | ) | | | (10,278 | ) |
| Cash at beginning of period | | | 3,582 | | | | 13,860 | |
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| Cash at end of period | | $ | 3,393 | | | $ | 3,582 | |
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