Ennis, Inc. Reports Results for the Quarter and Year Ended February 29, 2024, Sets Record Date for Annual Shareholder Meeting
- Revenues decreased by 5.2% for the quarter and 2.7% for the fiscal year compared to the previous year.
- Earnings per diluted share declined from $0.47 to $0.39 for the quarter and from $1.82 to $1.64 for the year.
- Gross profit margin improved to 28.4% for the quarter but decreased to 29.8% for the fiscal year.
- Net earnings were $10.1 million for the quarter and $42.6 million for the year.
- Acquisitions contributed approximately $4.5 million in revenues for the quarter and $21.2 million for the year.
- Interest income from cash and short-term investments increased due to higher interest rates.
- The company maintained a strong financial position with $110.9 million in cash and short-term investments and no debt.
- EBITDA declined slightly to $18.1 million for the quarter.
- The 2024 Annual Meeting of Shareholders will be held on July 18, 2024, with a record date of May 17, 2024.
- Revenues decreased both for the quarter and the fiscal year compared to the previous year.
- Earnings per diluted share showed a decline for both the quarter and the fiscal year.
- Gross profit margin decreased for the fiscal year.
- EBITDA declined slightly for the quarter.
- The company's prior year quarter was favorably impacted by the sale of an unused manufacturing facility, resulting in a gain that positively affected diluted earnings per share.
Insights
The decrease in Ennis, Inc’s quarterly and annual revenues by
The successful integration of recent acquisitions and the expected improvement in their margins could be key in stabilizing the company's financial health. However, this is a forward-looking statement and should be weighed against the inherent risks of integrating new business units. The strategic reduction of inventory, though improving cash flow, should be monitored in relation to sales to ensure it does not indicate a decrease in demand.
The increase in interest income from cash and short-term investments due to higher interest rates is a positive note, though it may be partially offset by the higher cost of potential future borrowings.
Ennis, Inc.'s financial performance needs to be considered within the larger context of the printing industry, which according to the CEO's comments, is experiencing a period of competitive pricing and soft market conditions. These factors often lead to industry-wide margin compressions and could affect future profitability. Still, the company's no-debt position and its ability to strategically manage inventory to improve cash flows are strengths in a challenging market. Acquisitions have contributed to revenues, but investors should look closely at the performance of these new assets going forward.
The company's focus on returning value through dividends is reassuring for investors seeking regular income, yet those looking for capital gains should keep an eye on how effectively Ennis can leverage its strong financial position to capitalize on acquisition opportunities without compromising its debt-free status.
-
Revenues were
$97.4 million $5.3 million 5.2% over last year's fourth quarter and$420.1 million $11.7 million 2.7% over last fiscal year. -
Earnings per diluted share for the current quarter were
$0.39 $0.47 $1.64 $1.82 -
Gross profit margin for the quarter increased from
27.6% last year to28.4% this year. Gross profit margin was29.8% for the fiscal year compared to30.3% for the prior fiscal year.
Financial Overview
The Company’s revenues for the fourth quarter ended February 29, 2024 were
The Company’s revenues for the fiscal year ended February 29, 2024 were
Keith Walters, Chairman, Chief Executive Officer and President, commented by stating, “Our performance for the quarter met our expectations. The print market overall continues to be fairly soft with competitive pricing, resulting in downward pressure on operating margin. Our gross profit margin showed an 80-basis point decline from the sequential quarter, decreasing from
“We are in the early stages of completing the implementations of our ERP systems of our recent acquisitions and when fully implemented, we believe the margins of the acquired businesses will improve to expected levels. These acquisitions did approximately
“The higher interest rates on our cash and short-term investments of
“We continue to maintain a strong financial position with
Non-GAAP Reconciliations
To provide important supplemental information to both management and investors regarding financial and business trends used in assessing its results of operations, from time to time the Company reports the non-GAAP financial measure of EBITDA (EBITDA is calculated as net earnings before interest expense, tax expense, depreciation, and amortization). The Company may also report adjusted gross profit margin, adjusted earnings and adjusted diluted earnings per share, each of which is a non-GAAP financial measure.
Management believes that these non-GAAP financial measures provide useful information to investors as a supplement to reported GAAP financial information. Management reviews these non-GAAP financial measures on a regular basis and uses them to evaluate and manage the performance of the Company’s operations. Other companies may calculate non-GAAP financial measures differently than the Company, which limits the usefulness of the Company’s non-GAAP measures for comparison with these other companies. While management believes the Company’s non-GAAP financial measures are useful in evaluating the Company, when this information is reported it should be considered as supplemental in nature and not as a substitute or an alternative for, or superior to, the related financial information prepared in accordance with GAAP. These measures should be evaluated only in conjunction with the Company’s comparable GAAP financial measures.
The following table reconciles EBITDA, a non-GAAP financial measure, for the three and twelve months ended February 29, 2024 and February 28, 2023 to the most comparable GAAP measure, net earnings (dollars in thousands).
|
|
Three months ended |
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Twelve months ended |
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|
February 29, |
|
February 28, |
|
February 29, |
|
February 28, |
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|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Net earnings |
|
$ |
10,146 |
|
|
$ |
12,193 |
|
|
$ |
42,597 |
|
|
$ |
47,300 |
|
Income tax expense |
|
|
3,718 |
|
|
|
3,978 |
|
|
|
16,526 |
|
|
|
17,630 |
|
Interest expense |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Depreciation and amortization |
|
|
4,217 |
|
|
|
4,310 |
|
|
|
17,512 |
|
|
|
17,356 |
|
EBITDA (non-GAAP) |
|
$ |
18,081 |
|
|
$ |
20,481 |
|
|
$ |
76,635 |
|
|
$ |
82,286 |
|
% of sales |
|
|
18.6 |
% |
|
|
19.9 |
% |
|
|
18.2 |
% |
|
|
19.1 |
% |
In Other News
The 2024 Annual Meeting of Shareholders will be held on July 18, 2024, with a record date of May 17, 2024.
About Ennis
Founded in 1909, the Company is one of the largest private-label printed business product suppliers in
Safe Harbor under the Private Securities Litigation Reform Act of 1995
Certain statements that may be 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 severity and duration of the COVID-19 pandemic and related economic repercussions, the erosion of demand for our printer business documents as the result of digital technologies, risk or uncertainties related to the completion and integration of acquisitions, the limited number of available suppliers and variability in the prices of paper and other raw materials, and operational challenges relating to the COVID-19 pandemic and efforts to mitigate the spread of the virus, including logistical challenges, protecting the health and well-being of our employees and potential plant closures. 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, including but not limited to, its Annual Report on Form 10-K for the fiscal year ending February 28, 2023. The Company does not undertake, and hereby disclaims, any duty or obligation to update or otherwise revise any forward-looking statements to reflect events or circumstances occurring after the date of this release, or to reflect the occurrence of unanticipated events, although its situation and circumstances may change in the future. You 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.
Ennis, Inc. |
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Unaudited Condensed Consolidated Financial Information |
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(In thousands, except share and per share amounts) |
||||||||||||||||
|
|
|||||||||||||||
|
|
Three months ended |
|
Twelve months ended |
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Condensed Consolidated Operating Results |
|
February 29, |
|
February 28, |
|
February 29, |
|
February 28, |
||||||||
|
|
|
2024 |
|
|
|
2023 |
|
|
|
2024 |
|
|
|
2023 |
|
Revenues |
|
$ |
97,434 |
|
|
$ |
102,692 |
|
|
$ |
420,109 |
|
|
$ |
431,837 |
|
Cost of goods sold |
|
|
69,763 |
|
|
|
74,342 |
|
|
|
294,767 |
|
|
|
300,787 |
|
Gross profit margin |
|
|
27,671 |
|
|
|
28,350 |
|
|
|
125,342 |
|
|
|
131,050 |
|
Operating expenses |
|
|
14,736 |
|
|
|
17,877 |
|
|
|
68,830 |
|
|
|
70,793 |
|
(Gain) Loss from disposal of assets |
|
|
— |
|
|
|
(5,911 |
) |
|
|
53 |
|
|
|
(5,896 |
) |
Operating income |
|
|
12,935 |
|
|
|
16,384 |
|
|
|
56,459 |
|
|
|
66,153 |
|
Other expense |
|
|
(929 |
) |
|
|
213 |
|
|
|
(2,664 |
) |
|
|
1,223 |
|
Earnings before income taxes |
|
|
13,864 |
|
|
|
16,171 |
|
|
|
59,123 |
|
|
|
64,930 |
|
Income tax expense |
|
|
3,718 |
|
|
|
3,978 |
|
|
|
16,526 |
|
|
|
17,630 |
|
Net earnings |
|
$ |
10,146 |
|
|
$ |
12,193 |
|
|
$ |
42,597 |
|
|
$ |
47,300 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
|
25,852,340 |
|
|
|
25,820,639 |
|
|
|
25,842,798 |
|
|
|
25,818,737 |
|
Diluted |
|
|
25,984,106 |
|
|
|
25,959,448 |
|
|
|
25,940,076 |
|
|
|
25,951,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
0.39 |
|
|
$ |
0.47 |
|
|
$ |
1.65 |
|
|
$ |
1.83 |
|
Diluted |
|
$ |
0.39 |
|
|
$ |
0.47 |
|
|
$ |
1.64 |
|
|
$ |
1.82 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
February 29, |
|
February 28, |
||||||
Condensed Consolidated Balance Sheet Information |
|
|
|
|
|
|
|
|
2024 |
|
|
|
2023 |
|
||
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Current Assets |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cash |
|
|
|
|
|
|
|
$ |
81,597 |
|
|
$ |
93,968 |
|
||
Investment Securities |
|
|
|
|
|
|
|
|
29,325 |
|
|
|
- |
|
||
Accounts receivable, net |
|
|
|
|
|
|
|
|
47,209 |
|
|
|
53,507 |
|
||
Inventories, net |
|
|
|
|
|
|
|
|
40,037 |
|
|
|
46,834 |
|
||
Other |
|
|
|
|
|
|
|
|
3,214 |
|
|
|
2,317 |
|
||
Total Current Assets |
|
|
|
|
|
|
|
|
201,382 |
|
|
|
196,626 |
|
||
Property, plant & equipment, net |
|
|
|
|
|
|
|
|
54,965 |
|
|
|
47,789 |
|
||
Operating lease right-of-use assets |
|
|
|
|
|
|
|
|
9,827 |
|
|
|
13,133 |
|
||
Goodwill and intangible assets |
|
|
|
|
|
|
|
|
132,676 |
|
|
|
135,907 |
|
||
Other |
|
|
|
|
|
|
|
|
340 |
|
|
|
380 |
|
||
Total Assets |
|
|
|
|
|
|
|
$ |
399,190 |
|
|
$ |
393,835 |
|
||
Liabilities and Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Accounts payable |
|
|
|
|
|
|
|
$ |
11,846 |
|
|
$ |
18,333 |
|
||
Accrued expenses |
|
|
|
|
|
|
|
|
17,541 |
|
|
|
18,067 |
|
||
Current portion of operating lease liabilities |
|
|
|
|
|
|
|
|
4,414 |
|
|
|
4,847 |
|
||
Total Current Liabilities |
|
|
|
|
|
|
|
|
33,801 |
|
|
|
41,247 |
|
||
Other non-current liabilities |
|
|
|
|
|
|
|
|
15,548 |
|
|
|
21,156 |
|
||
Total liabilities |
|
|
|
|
|
|
|
|
49,349 |
|
|
|
62,403 |
|
||
Shareholders' Equity |
|
|
|
|
|
|
|
|
349,841 |
|
|
|
331,432 |
|
||
Total Liabilities and Shareholders' Equity |
|
|
|
|
|
|
|
$ |
399,190 |
|
|
$ |
393,835 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
Twelve months ended |
|
||||||||||
|
|
|
|
|
February 29, |
|
February 28, |
|||||||||
Condensed Consolidated Cash Flow Information |
|
|
|
|
|
|
|
|
2024 |
|
|
|
2023 |
|
||
Cash provided by operating activities |
|
|
|
|
|
|
|
$ |
69,069 |
|
|
$ |
46,776 |
|
||
Cash used in investing activities |
|
|
|
|
|
|
|
|
(54,994 |
) |
|
|
(11,457 |
) |
||
Cash used in financing activities |
|
|
|
|
|
|
|
|
(26,446 |
) |
|
|
(26,957 |
) |
||
Change in cash |
|
|
|
|
|
|
|
|
(12,371 |
) |
|
|
8,362 |
|
||
Cash at beginning of period |
|
|
|
|
|
|
|
|
93,968 |
|
|
|
85,606 |
|
||
Cash at end of period |
|
|
|
|
|
|
|
$ |
81,597 |
|
|
$ |
93,968 |
|
||
View source version on businesswire.com: https://www.businesswire.com/news/home/20240422643032/en/
Mr. Keith S. Walters, Chairman, Chief Executive Officer and President
Ms. Vera Burnett, Chief Financial Officer
Mr. Dan Gus, General Counsel and Secretary
Ennis, Inc.
Phone: (972) 775-9801
Fax: (972) 775-9820
www.ennis.com
Source: Ennis, Inc.
FAQ
What were Ennis, Inc.'s revenues for the quarter and fiscal year ended February 29, 2024?
What were the earnings per diluted share for the quarter and fiscal year ended February 29, 2024?
What was the gross profit margin for the quarter ended February 29, 2024?
What is the record date for the 2024 Annual Meeting of Shareholders for Ennis, Inc.?
