Home / Knowledge / News / Apparel/Garments / Ennis apparel sales fall 10.6% in Q4 FY'13
Ennis apparel sales fall 10.6% in Q4 FY'13
23
Apr '13
Ennis, Inc. reported financial results for the quarter and fiscal year ended February 28, 2013.

Highlights for the quarter include:

Consolidated sales increased 1.7%
- Print sales increased $7.4 million
- Apparel sales declined $5.2 million

Consolidated gross profit margin increased 360 basis points
- Print gross profit margin increased 130 basis points
- Apparel gross profit margin increased 540 basis points
- Diluted EPS increased 108% to $0.27 per share

Financial Overview

Our consolidated net sales for the fourth quarter were $123.6 million, an increase of 1.7% from $121.5 million for the same quarter last year. Print sales increased 10.2% for the quarter, from $72.4 million to $79.8 million, while apparel sales declined by 10.6% for the quarter, from $49.1 million to $43.9 million. Our consolidated gross profit margin ("margin") for the fourth quarter increased from 21.8%, for the same quarter last year, to 25.4%.

For the fourth quarter by segment, print margin increased from 28.3% to 29.6%, and apparel margin increased from 12.2% to 17.6%. Lower priced cotton is beginning to favorably impact the Apparel segment’s finished goods inventory and we expect our apparel margins to continue to improve as the cost of cotton in finished goods continues to decline and as sales volume increases.

Print margins improved from the elimination of some of the duplicate selling, general and administrative costs associated with our recent acquisitions and further integration of these operations onto our systems. As a result, our net earnings increased from $3.3 million, or 2.7% of net sales, for the fourth quarter ended February 29, 2012 to $7.1 million, or 5.7% of net sales, for the fourth quarter ended February 28, 2013. Diluted earnings per share increased from $0.13 for the quarter ended February 29, 2012 to $0.27 for the quarter ended February 28, 2013.

For the fiscal year, our net sales increased from $517.0 million for the year ended February 29, 2012 to $533.5 million for the year ended February 28, 2013, or an increase of 3.2%. Print sales for the year increased $56.7 million or 20.4%, from $278.0 million to $334.7 million, while apparel sales for the year decreased $40.2 million or 16.8%, from $239.0 million to $198.8 million.

Our consolidated margin decreased from 25.2% to 23.3% for the fiscal years ended 2012 and 2013, respectively. For the fiscal year by segment, print margin increased from 28.4% to 29.2%, and apparel margin decreased from 21.6% to 13.2% due to the higher cost of cotton in finished goods and reduced sales volume stemming from sale-side pressure.

As a result, our net earnings decreased from $31.4 million, or 6.1% of net sales for the fiscal year ended February 29, 2012, to $24.7 million, or 4.6% of net sales for the fiscal year ended February 28, 2013. Diluted earnings per share decreased from $1.21 to $0.95 for each year, respectively.

During the fourth quarter, the Company generated $14.6 million in EBITDA (a non-GAAP financial measure calculated as net earnings before interest, taxes, depreciation, and amortization) compared to $8.7 million for the comparable quarter last year. For the fiscal year ended February 28, 2013, the Company generated $53.5 million of EBITDA compared to $64.0 million for the prior fiscal year.

Ennis

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