FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended AUGUST 31, 1995
Commission File Number 1-5807
ENNIS BUSINESS FORMS, INC.
(Exact name of registrant as specified in its charter)
TEXAS 75-0256410
(State or other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
107 N. Sherman Street, Ennis, TX 75119
(Address of principal executive offices) (Zip Code)
(214) 872-3100
(Registrant's telephone number, including area code)
No Change
(Former name, former address and former fiscal year, if changed since last
report.)
Indicate by check mark whether the registrant (1) has filed all reports
required 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 prior that the
registrant was required to file such report), and (2) has been subject to
such filing requirements for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class Outstanding at August 31, 1995
Common stock, par value $2.50 per share 16,439,554
ENNIS BUSINESS FORMS, INC.
INDEX
Part I. Financial Information
Consolidated Condensed Balance Sheets --
August 31, 1995 and February 28, 1995 2
Consolidated Condensed Statements of Earnings --
Three and Six Months Ended August 31,1995
and 1994 3
Consolidated Condensed Statements of Cash
Flows --Six Months Ended August 31, 1995
and 1994 4
Notes to Consolidated Condensed Financial
Statements 5
Management's Discussion and Analysis of
Financial Condition and Results of
Operations 6
Part II. Other Information 7
PART I. FINANCIAL INFORMATION
ENNIS BUSINESS FORMS, INC.
CONSOLIDATED CONDENSED BALANCE SHEETS
(Dollars in Thousands)
(Unaudited)
August 31, February 28,
1995 1995
Assets
Current assets
Cash and equivalents $18,040 10,541
Temporary investments 12,142 17,600
Accounts receivable, net 17,637 18,284
Inventories 10,142 10,301
Other current assets 4,661 2,539
Total current assets 62,622 59,265
Property, plant and equipment, net 20,590 19,521
Cost of purchased businesses in excess of amounts
allocated to tangible net assets 4,272 4,356
Other assets and deferred charges 1,337 1,849
Total assets $88,821 84,991
Liabilities and Stockholders' Equity
Current liabilities
Current installments of long-term debt $ 75 75
Accounts payable 4,610 5,014
Accrued expenses 7,293 6,807
Federal and state income taxes payable 818 1,080
Total current liabilities 12,796 12,976
Long-term debt, less current installments 360 360
Deferred credits, principally Federal income taxes 2,056 2,317
Stockholders' equity
Common stock, at par value 53,125 53,125
Additional capital 1,040 1,040
Retained earnings 111,381 107,100
Cumulative foreign currency translation adjustments (129) (125)
165,417 161,140
Less:
Treasury stock 91,808 91,802
Total stockholders' equity 73,609 69,338
Total liabilities and stockholders' equity $88,821 84,991
See accompanying notes to consolidated condensed financial statements.
ENNIS BUSINESS FORMS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS
(Dollars in Thousands Except Per Share Amounts)
(Unaudited)
Three Months Ended Six Months Ended
August 31, August 31,
1995 1994 1995 1994
Net sales $35,707 34,594 $70,816 68,635
Costs and expenses:
Cost of sales 22,768 21,495 45,043 42,504
Selling, general and
administrative expenses 5,952 5,511 12,008 10,961
Interest expense 23 21 47 43
28,743 27,027 57,098 53,508
Earnings from operations 6,964 7,567 13,718 15,127
Investment and other income 471 260 916 615
Earnings before income taxes 7,435 7,827 14,634 15,742
Provision for income taxes 2,794 2,934 5,503 5,874
Net earnings $4,641 4,893 $9,131 9,868
Weighted average number of
common shares outstanding 16,439,660 16,440,472 16,439,746 16,439,572
Per share amounts:
Net earnings $.29 .30 $.56 .60
Cash dividends $.15 .145 $.295 .285
See accompanying notes to consolidated condensed financial statements.
ENNIS BUSINESS FORMS, INC.
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
Six Months Ended
August 31,
1995 1994
Cash flows from operating activities:
Net earnings $9,131 9,868
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 1,855 1,843
Changes in assets and liabilities (1,308) (3,388)
Other (29) (232)
Net cash provided by operating activities 9,649 8,091
Cash flows from investing activities:
Capital expenditures (2,833) (1,686)
Purchase of investments (6,064) --
Maturities of investments 11,602 --
Other 1 203
Net cash provided by (used in) investing
activities 2,706 (1,483)
Cash flows from financing activities:
Dividends declared (4,850) (4,686)
Other (6) 7
Net cash used in financing activities (4,856) (4,679)
Net change in cash and equivalents 7,499 1,929
Cash and equivalents at beginning of period 10,541 21,577
Cash and equivalents at end of period $18,040 23,506
See accompanying notes to consolidated condensed financial statements.
ENNIS BUSINESS FORMS, INC.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
1. The information included herein reflects all adjustments (none of which
were other than normal recurring accruals) which, in the opinion of the
Company, are necessary to a fair statement of the financial position as
of August 31, 1995 and February 28, 1995, and the results of operations
and cash flows for the three months and six months ended August 31,
1995 and 1994.
2. Earnings per common share amounts are based on the weighted average
number of shares outstanding during the period. Common stock
equivalents (options see Note 3) have not been included in determining
earnings per common share amounts because their inclusion, either for
purposes of computing primary or fully diluted earnings per share,
would not produce sufficient incremental shares (using the treasury
stock method) to reduce the per share amounts shown.
3. As of August 31, 1995, the Company has reserved 378,958 shares of
common stock under incentive stock options plans.
4. The Company uses the Last-In, First-Out (LIFO) method of pricing the
raw material content of most of its business forms inventories, and the
First-In, First-Out (FIFO) method is used to value the remainder. The
following table summarizes the components of inventory at the different
stages of production (in thousands of dollars):
August 31, February 28,
1995 1995
Raw material $ 6,641 6,746
Work-in-process 949 963
Finished goods 2,552 2,592
$10,142 10,301
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
At August 31, 1995, the Company's financial position continues to be
strong. Working capital increased from $46,289,000 at February 28, 1995 to
$49,826,000 at August 31, 1995. The increase is due to cash provided by
operating activities. The Company's cash flow from operations continues to
be adequate to sustain operations, meet debt repayment requirements and
fund capital additions. No liquidity problems are anticipated.
Results of Operations
Net sales for the quarter and six months ended August 31, 1995 each
increased 3.2% from the corresponding periods in the prior year. Gross
margins for the three and six months ended August 31, 1995 decreased 1.2%
and 1.4%, respectively, over the same periods in the prior year. Because
of competitive market conditions and the amount and frequency of raw
material price increases, our selling price increases have lagged behind
cost increases. Selling, general and administrative expenses for the three
and six months ended August 31, 1995 increased 8% and 9.6%, respectively,
compared to the corresponding periods in the prior year. Increases in
selling and marketing efforts and expenses of our Mexico operation account
for the increases. Investment and other income increased in the current
year over the prior year due to increased amounts of funds available for
investments and higher interest rates. The effective rate of Federal and
state income tax expense is substantially unchanged from year to year.
PART II. OTHER INFORMATION
Item 6. Exhibits
Exhibit:
(27) Financial Data Schedule
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.
ENNIS BUSINESS FORMS, INC.
Date October 5, 1995 /s/Harve Cathey
Harve Cathey
Vice President - Finance
Principal Financial Officer
Date October 5, 1995 /s/Victor V. DiTommaso
Victor V. DiTommaso
Treasurer
Principal Accounting Officer