Ennis, Inc. Reports Results for the First Quarter Ended May 31, 2018

Ennis, Inc. (the “Company”), (NYSE: EBF), today reported financial
results for the first quarter ended May 31, 2018. Highlights include:

Financial Overview

The Company’s revenues for the first quarter ended May 31, 2018 were
$93.4 million compared to $94.6 million for the same quarter last year,
a decrease of 1.3%. Gross profit margin (“margin”) was $30.2 million for
the quarter, or 32.3%, as compared to $30.0 million, or 31.7% for the
first quarter last year. Net earnings for the quarter were $9.2 million,
or $0.36 per diluted share compared, to $7.8 million, or $0.31 per
diluted share, for the first quarter last year.

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 adjusted
gross profit margin, adjusted earnings and adjusted diluted earnings per
share, each of which is a non-GAAP financial measure. To provide
additional information, the Company also reports the non-GAAP financial
measure of EBITDA (EBITDA is calculated as earnings from operations
before interest, taxes, depreciation, and amortization).

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. In addition, EBITDA is a
component of the financial covenants and an interest rate metric in the
Company’s credit agreement.

Reconciliations of non-GAAP financial measures for the quarter to the
most directly comparable measures calculated and presented in accordance
with GAAP are set forth in the following table. Other companies may
calculate non-GAAP adjusted financial measures differently than Ennis,
which limits the usefulness of the non-GAAP measures for comparison with
these other companies. While management believes the Company’s non-GAAP
financial measures are useful in evaluating Ennis, this information
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 first quarter of this year and the first quarter of last year to the
most comparable GAAP measure, net earnings (dollars in thousands).

Keith Walters, Chairman, Chief Executive Officer and President,
commented by stating, “We are pleased with our first quarter
performance. We continue to build on the momentum of last year. We
recently completed the integration of our ERP system at our Independent
operation and believe we can further optimize its performance. We also
recently completed the acquisition of a tag company based in Caledonia,
New York and look forward to it contributing to our bottom line in the
months to come. We continue to explore strategic opportunities in the
acquisition arena as a way to profitably utilize our cash.”

Mr. Walters also noted, “Given our strong balance sheet and continued
strong performance, our Board approved a 12 ½% increase in our quarterly
dividend, effective with our upcoming regularly scheduled August
dividend payment. This is the third increase in our quarterly dividends
in the last six years, and the second in the last two years. We also
purchased approximately 38,000 shares of our common stock in the first
quarter, under our stock repurchase program, at an average price of
$17.92 per share. In accordance with our repurchase program, we will
continue to repurchase our shares when we believe the market price is
undervalued. The industry continues to be challenged by paper price
increases, trucking shortages and allocations of certain paper grades.
The printing industry hasn’t experienced paper allocations for several
decades, and we believe our long-term relationship with our paper
supplier will allow the Company to avoid any material disruption in our
supply chain. While we don’t see any of these challenges changing in the
short-term, we are encouraged by our performance so far this year and
feel positive about the remainder of the year. We continue to strengthen
one of the strongest balance sheets in the industry and our cash
position remains significant, which allows us many opportunities.”

About Ennis

Since 1909, Ennis has been primarily engaged in the production and sale
of business forms 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, Ennis has production and
distribution facilities strategically located throughout the USA to
serve the Company’s national network of distributors. Ennis manufactures
and sells business forms, other printed business products, printed and
electronic media, presentation products, flex-o-graphic printing,
advertising specialties and Post-it® Notes, internal bank forms, plastic
cards, secure and negotiable documents, envelopes, tags and labels and
other custom products. For more information, visit www.ennis.com.

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 competitive environment, the Company’s ability to adapt and expand its
services in such an environment and 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, including but not limited to, its Annual Report on
Form 10-K for the fiscal year ending February 28, 2018. 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.

Condensed Consolidated Operating Results

Weighted average common shares outstanding

Earnings per share

Condensed Consolidated Balance Sheet
Information

Condensed Consolidated Cash Flow
Information

View source version on businesswire.com: https://www.businesswire.com/news/home/20180625005170/en/

Leave a Comment