Ennis FY'14 apparel sales grow 1.9%

22 Apr '14

5 min read

Ennis, Inc., reported financial results for the quarter and fiscal year ended February 28, 2014.

Highlights for the year:

-Consolidated sales increased 1.7%

-Print sales increased $5.2 million

-Apparel sales increased $3.7 million

-Consolidated gross profit margin increased 320 basis points

-Print gross profit margin increased 50 basis points

-Apparel gross profit margin increased 790 basis points

-Non-GAAP diluted EPS increased 42.1% to $1.35 per share, before impairment charge of $0.85 per share resulting in GAAP diluted EPS of $0.50 per share.

Financial Overview

The Company’s consolidated net sales for the quarter were $132.1 million compared to $123.6 million for the same quarter last year. Print sales increased 12.7% on a comparable quarter basis, from $79.8 million to $89.9 million. Apparel sales decreased 3.6% for the comparable quarter, from $43.9 million to $42.3 million. Consolidated gross profit margin ("margin") during the quarter remained level at 25.4% in comparison to last year’s quarter. On a quarter comparison basis, print margin decreased 120 basis points, from 29.6% to 28.4%, while apparel margin increased 140 basis points, from 17.6% to 19.0%.

Apparel margin continued to improve due to lower input costs and higher production levels. Net earnings (loss) for the quarter decreased from $7.1 million, or 5.7% of net sales, for the quarter ended February 28, 2013 to ($14.5) million for the quarter ended February 28, 2014, due to a goodwill and trademark impairment charge of $24.2 million relating to the apparel division. Diluted earnings (loss) per share decreased from $0.27 for the quarter ended February 28, 2013 to ($0.55) for the quarter ended February 28, 2014. Excluding the impairment charge, non-GAAP earnings for the quarter would have been approximately $7.7 million, or approximately $0.30 per share.

For the fiscal year, consolidated net sales increased from $533.5 million for the year ended February 28, 2013 to $542.4 million for the year ended February 28, 2014, or an increase of 1.7%. Print sales for the year increased $5.2 million or 1.6%, from $334.7 million to $339.9 million, while apparel sales for the year increased $3.7 million or 1.9%, from $198.8 million to $202.5 million. Consolidated margin increased from 23.3% to 26.5% for the fiscal years ended 2013 and 2014, respectively. For the fiscal year by segment, print margin increased from 29.2% to 29.7%, and apparel margin increased from 13.2% to 21.1% due to lower input costs and increased production levels.

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