Ennis Inc. Reports Results for 4th Quarter and Year Ended Feb. 28, 2023

Ennis Inc., Midlothian, Texas, reported financial results for the quarter and fiscal year ended February 28, 2023.

The company’s revenues for the fourth quarter ended Feb. 28, 2023 were $102.7 million compared to $99.7 million for the same quarter last year, an increase of 3%. The increase was attributable to $1.4 million in revenues from the company's recent acquisition of School Photo Marketing, as well as price increases that were partially offset by volume decreases attributable in part to seasonal factors.

Gross profit margin was $28.4 million or 27.6%, as compared to $27.4 million or 27.5% for the same quarter last year. Ennis' gross profit margin decreased on a sequential basis from 30.4% for the third quarter ended Nov. 30, 2022, to 27.6%. The company's margin during the period was negatively impacted by a decrease in revenue volume, increased cost of material and labor, and to a lesser extent by the acquisition of School Photo Marketing at the beginning of its low margin off-season.

Net earnings for the quarter were $12.2 million, or $0.47 per diluted share, as compared to $6.7 million, or $0.26 per diluted share for the same quarter last year. Quarterly net earnings results were favorably impacted by a $5.8 million gain, or $0.17 per diluted share from the sale of an unused manufacturing facility.

The company’s revenues for the fiscal year ended Feb. 28, 2023 were $431.8 million compared to $400 million for the prior fiscal year, an increase of 8%. Gross profit margin was $131.1 million, or 30.3%, as compared to $114.7 million, or 28.7%, for the prior fiscal year. Net earnings for the fiscal year were $47.3 million, or $1.82 per diluted share, compared to $29 million, or $1.11 per diluted share, for the prior fiscal year. The $5.8 million gain from the sale of an unused manufacturing facility impacted the current fiscal year results by $0.17 per diluted share.

"We are pleased with our performance for the fourth quarter," said Keith Walters, chairman, CEO and president of Ennis Inc. "Throughout our fiscal year ended February 28, 2023, we experienced strong demand for our products and navigated a challenging environment with supply chain disruptions and inflationary cost pressures not seen in decades. ... Increased foreign imports and demand declines have currently stabilized price increases of North American printing and writing paper. The extent to which import pressures remain in place will likely play a major role in price stability or decreases. We continue to monitor incoming order volumes, as well as rising raw material and other input costs so that we can proactively adjust our pricing and costs accordingly. We believe we have one of the strongest balance sheets in the industry, with no debt and significant cash. Our profitability and strong financial condition will allow us to continue operations and fund acquisitions without incurring debt. Given those strengths, we also anticipate timely access to credit, should larger acquisition opportunities materialize as we continue to explore strategic opportunities in the acquisition arena to increase profitability."

Source: Ennis Inc.

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