Courier’s Revenues, Net Income Rebound in First Quarter

Book manufacturing earnings up 59% on 8% sales gain

Courier’s book manufacturing segment had first-quarter sales of $54.8 million, up 8% from $50.9 million in last year’s first quarter. The segment’s operating income was $5.7 million, up 59% from $3.6 million a year ago. Gross profit in the segment rose to $13.1 million from $10.6 million in fiscal 2009, and rose as a percentage of sales to 23.8% from last year’s figure of 20.9%.

The book manufacturing segment focuses on three publishing markets: education, religion, and specialty trade. Sales to the education market were up 15% in the quarter due to increased sales of four-color textbooks for colleges and universities. Sales to the specialty trade market were flat from a year ago, though four-color trade sales were up. Sales to the religious market were up 12% from last year’s first quarter.

“We welcomed the return of a healthy order flow from our largest religious customer,” said Mr. Conway. “On top of that, we had continued growth in sales of college textbooks. Our margins were helped by increased capacity utilization as well as the cost reductions achieved last year. But the largest factor continued to be our success at attracting more four-color work from both new and existing customers. Overall, it was a very good way to end the old calendar year and start off a more promising fiscal year.”

Growth at Dover and REA drives improved publishing performance

Courier’s specialty publishing segment includes three businesses: Dover Publications, a niche publisher with thousands of titles in dozens of specialty trade markets; Research & Education Association (REA), a publisher of test preparation books and study guides; and Creative Homeowner, which publishes books on home design, decorating, landscaping and gardening.

First-quarter revenues for the segment were $11.6 million, up slightly from $11.5 million in last year’s first quarter. Sales were up 18% at Dover and up 48% at REA, spurred by strong sales of Dover books in several categories and REA’s largest quarterly launch of new titles ever. Creative Homeowner sales were down 61%, reflecting continued weakness in store traffic at home centers, the company’s largest sales channel. This decrease in sales also reflected the company’s cessation of its book distribution services in early January 2009, which contributed approximately $1.2 million of revenue in last year’s first quarter. Overall, the segment lost $514,000 in the quarter, versus a loss of $1.9 million a year ago. This improvement reflects both the revenue growth at Dover and REA and the effects of cost reduction measures implemented in fiscal 2009.

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