Courier Starts Off Strong in New Fiscal Year
“Throughout the quarter, we continued to enjoy strong cash flow, which enabled us to reduce our debt by $5 million during the quarter. In November Courier’s Board of Directors authorized a new $10-million stock repurchase program and reaffirmed its commitment to the dividend based on its confidence in the company’s balance sheet, cash flow and business prospects. And today I am pleased to report that the Board has declared a dividend of $.21 per share, the same as last quarter.”
Book manufacturing: gains in education and religious markets
Courier’s book manufacturing segment reported first-quarter sales of $57.5 million, up 3 percent from $56.0 million in last year’s first quarter. The segment’s operating income was $5.5 million, up from $5.1 million in fiscal 2012, excluding last year’s severance and post-retirement benefit expenses.
Gross profit in the segment was $13.1 million or 22.7 percent of sales in the quarter, versus $12.5 million or 22.3 percent of sales a year ago, as a favorable sales mix and continuing benefits from last year’s cost-reduction measures offset a competitive pricing environment and reduced recycling income.
The book manufacturing segment focuses on three markets: education, religion, and specialty trade. Sales to the education market were $25 million in the first quarter, up 16 percent from the same period last year, due to increased sales of college textbooks. Sales to the religious market were up 6 percent to $17 million in the quarter, with sales to Courier’s largest religious customer up 9 percent. Sales to the specialty trade market were down 13 percent to $15 million, reflecting tight inventory management among publishers and the impact of e-book sales on certain titles.
Revenues rose more than 40 percent at Courier Digital Solutions on continued growth of customized versions of college textbooks as well as increased use of digital printing among specialty trade publishers. With its current digital facilities running close to capacity, in October Courier announced plans to add a new HP Indigo cover press in Massachusetts and a new digital production facility in Kendallville, Indiana. The Indiana facility will include a wide format HP press and new HP Indigo press together with finishing equipment. This is expected to bring the company’s total investment in digital print to approximately $40 million.