Exhibit 99.1
(Ennis Logo)
FOR IMMEDIATE RELEASE
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ENNIS, INC. REPORTS RESULTS FOR THE QUARTER AND
PERIOD ENDED NOVEMBER 30, 2005
Midlothian, Texas December 21, 2005 -- Ennis, Inc. (the
"Company"), (NYSE: EBF), today reported financial results for
the quarter and the period ended November 30, 2005.
(bullet) Net sales increased $39.9 million over same
quarter last year and $198.0 million over the
comparative nine-month period last year.
(bullet) Profits increased 65.6%, from $6.1 million
to $10.1 million for quarter, and 93.8%, from
$16.1 million to $31.2 million for the nine-
month period ended November 30, 2004 and 2005,
respectively.
(bullet) Growth in diluted EPS to $.39 and $1.21 per
share for the quarter and nine-month period
ended November 30, 2005, representing an
increase of 11.4% and 27.4%, respectively over
the comparable periods last year.
Financial Overview
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For the third quarter, net sales increased by $39.9
million, or 43.5% from $91.8 for the three months ended
November 30, 2004 to $131.7 million for the three months ended
November 30, 2005. Net sales in the Print Solutions segment
for the quarter were $77.9 million compared to $87.4 million
for the same quarter last year. Sales in the Apparel Solutions
segment during the period were $53.8 million compared to
$4.4 million for the same quarter last year. Net earnings for
the quarter increased by $4.0 million, or 65.6% from $6.1
million for the three months ended November 30, 2004 to $10.1
million for the three months ended November 30, 2005. Diluted
earnings per share for the three months ended November 30,
2005 was $0.39 compared to $0.35 for the three months ended
November 30, 2004.
Given that this is the first year in which the
seasonality of the Alstyle acquisition is being reported, the
Company is providing information in this release on linked
quarters (the second and third quarter of this fiscal year) to
aid investors and stockholders prior to the filing of the
10-Q for the quarter ended November 30, 2005. Compared to the
second quarter of this fiscal year, net sales decreased
11.1% from $148.1 million to $131.7 million. Net sales in the
Apparel Solutions segment declined from $64.2 million in the
second quarter of this fiscal year to $53.8 million in the
third quarter, or 16.2%. Profitability, as a percent of sales,
however, increased as many of the operational improvements
put into place improved margins. As previously indicated, the
sales in the apparel segment are cyclical and decline in the
third and fourth quarters of the Company's fiscal year
compared to the results in the first two quarters of the
fiscal year. Net sales in the Print Solutions segment declined
from $83.9 million at the end of the second quarter of this
fiscal year to
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$77.9 million, or 7.2%. This decline was due in part to
reduced volume from a large customer in the Promotional
Solutions group, and reduced sales from the closing of two
unprofitable locations during the first half of this fiscal
year. For the year, net sales increased by approximately
$198.0 million, or 85.8% from $230.9 million for the nine
months ended November 30, 2004 to $428.9 million for the nine
months ended November 30, 2005. Sales in the Print Solutions
segment for the period were $242.4 million compared to $226.5
million for the same period last year. The Apparel Solutions
segment sales for the period were $186.5 million compared to
$4.4 million for the same period last year. Net earnings for
the year increased by $15.1 million, or 93.8% from $16.1
million for the nine months ended November 30, 2004 to
$31.2 million for the nine months ended November 30, 2005.
Diluted earnings per share increased from $.95 to $1.21 for
the nine months ended November 30, 2004 and 2005, respectively.
The Company generated $23.0 million in EBITDA
(earnings before interest, taxes, depreciation and
amortization) for the quarter compared to $12.5 million for
the comparable quarter last year, and $70.8 million for the
nine months ended November 30, 2005 compared to $33.3 for the
comparable period last year.
Reconciliation of Non-GAAP to GAAP measure (dollars in
thousands):
Three months ended Nine months ended
November 30, November 30,
2005 2004 2005 2004
---- ---- ---- ----
Earnings before
income taxes $ 16,418 $ 9,869 $ 50,783 $ 25,921
Interest expense 2,235 288 6,801 589
Depreciation/
amortization 4,347 2,342 13,167 6,766
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EBITDA (non-GAAP) $ 23,000 $ 12,499 $ 70,751 $ 33,276
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Keith Walters, Chairman, President & CEO, commented by
saying, "we are extremely pleased with our results for the
quarter and with the post-merger operating results which
continue to meet or exceed our pro-forma expectations outlined
in last year's S-4 filing. Our management team for the Apparel
segment should be in place in January 2006, and this segment
continues to perform within our expectations."
About Ennis
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Ennis, Inc. (www.ennis.com) (formerly Ennis Business
Forms, Inc.) 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 Printing Segment and Apparel Segment. There are
three groups within the Printing Segment: the Forms Solutions
Group, Promotional Solutions Group, and Financial Solutions
Group. The Apparel Segment consists entirely of the Apparel
Solutions Group. The Forms Solutions Group is primarily
engaged in the business of manufacturing and selling business
forms and other printed business products. The Promotional
Solutions Group is primarily engaged in the business of
design, production and distribution of printed and electronic
media, presentation products, flex-o-graphic printing,
advertising specialties and Post-it (registered trademark)
Notes. The Financial
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Solutions Group designs, manufactures and markets printed
forms and specializes in internal bank forms, secure and
negotiable documents and custom products. The Apparel
Solutions Group 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
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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:
Keith Walters, Chairman, Chief Executive Officer and President
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
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ENNIS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
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November 30, February 28,
2005 2005
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Assets (Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 11,625 $ 10,694
Accounts receivable, net 38,200 46,685
Inventories 89,674 79,900
Other current assets 12,692 11,894
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Total current assets 152,191 149,173
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PROPERTY, PLANT AND EQUIPMENT, NET 67,603 72,019
GOODWILL, NET 178,157 178,472
OTHER ASSETS 93,032 97,582
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$ 490,983 $ 497,246
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Liabilities and Shareholders' Equity
CURRENT LIABILITIES:
Current installments of
long-term debt $ 21,120 $ 21,702
Accounts payable 27,863 33,887
Accrued expenses & taxes payable 23,508 25,794
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Total current liabilities 72,491 81,383
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LONG-TERM DEBT 96,550 112,342
DEFERRED CREDITS (principally taxes) 30,223 31,790
SHAREHOLDERS' EQUITY 291,719 271,731
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$ 490,983 $ 497,246
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ENNIS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
(Dollars in thousands except per share amounts)
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Three months ended Nine months ended
November 30, November 30,
2005 2004 2005 2004
---- ---- ---- ----
(Unaudited) (Unaudited)
NET SALES $ 131,690 $ 91,750 $ 428,918 $ 230,860
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COSTS AND EXPENSES:
Cost of sales 96,070 68,876 318,569 171,574
Selling, general and
administrative expenses 17,801 12,907 53,429 33,106
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113,871 81,783 371,998 204,680
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OPERATING INCOME 17,819 9,967 56,920 26,180
OTHER INCOME (EXPENSE):
Interest expense (2,235) (288) (6,801) (589)
Other income,net 834 190 664 330
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(1,401) (98) (6,137) (259)
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EARNINGS BEFORE INCOME TAXES 16,418 9,869 50,783 25,921
Provision for income taxes 6,320 3,765 19,551 9,865
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NET EARNINGS $ 10,098 $ 6,104 $ 31,232 $ 16,056
========= ========= ========= =========
PER SHARE AMOUNTS
Basic earnings $ 0.40 $ 0.36 $ 1.23 $ 0.97
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Diluted earnings $ 0.39 $ 0.35 $ 1.21 $ 0.95
========= ========= ========= =========
Dividends $ 0.155 $ 0.155 $ 0.465 $ 0.465
========= ========= ========= =========
WEIGHTED AVERAGE SHARES
OUTSTANDING:
Basic 25,457,965 16,959,463 25,446,315 16,599,542
========== ========== ========== ==========
Diluted 25,743,327 17,320,580 25,726,003 16,924,120
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ENNIS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
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Nine Months Ended
November 30,
2005 2004
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CASH FLOWS FROM OPERATING ACTIVITIES: (Unaudited)
Net earnings $ 31,232 $ 16,056
Adjustments to reconcile net
earnings to net cash provided
by operating activities:
Depreciation and amortization 13,167 6,766
Gain on sale of property,
plant and equipment (217) (239)
Changes in operating assets
and liabilities (8,267) (2,711)
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Net cash provided by
operating activities 35,915 19,872
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CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (7,375) (4,581)
Purchase of operating assets - (114,620)
Other 246 400
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Net cash used in investing
activities (7,129) (118,801)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Debt issued 9,000 109,500
Repayment of debt issued (25,374) (6,353)
Exercise of stock options 350 372
Dividends (11,831) (7,634)
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Net cash provided by
(used in) financing
activities (27,855) 95,885
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NET CHANGE IN CASH AND EQUIVALENTS 931 (3,044)
CASH AND EQUIVALENTS AT BEGINNING OF
PERIOD 10,694 15,067
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CASH AND EQUIVALENTS AT END OF
PERIOD $ 11,625 $ 12,023
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