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Courier Records Modest Declines in Q4, Net Loss for Fiscal Year

November 5, 2009
NORTH CHELMSFORD, MA—November 05, 2009—Courier Corp. (Nasdaq: CRRC), one of America’s leading book manufacturers and specialty publishers, today announced fourth-quarter and full-year results for its fiscal year ended September 26, 2009.

With the recession affecting sales in both of the company’s business segments, Courier’s consolidated fourth-quarter revenues were $68.4 million, down 10% from $76.3 million in last year’s fourth quarter. Net income for the fourth quarter was $5.7 million or $.48 per diluted share, versus $7.2 million or $.60 per diluted share in the fourth quarter of fiscal 2008. Excluding a fourth-quarter restructuring charge, net income would have been $.54 per diluted share, in line with previous guidance.

For fiscal 2009 overall, Courier sales were $248.8 million, down from $280.3 million in 2008. Net loss for the year was $3.1 million or $.27 per share, versus a loss of $370,000 or $.03 per share last year. The net loss in fiscal 2009 reflects a non-cash, pre-tax impairment charge of $15.6 million taken earlier in the year, as well as restructuring costs of $4.8 million. Excluding these charges, net income for fiscal 2009 would have been $10.2 million or $.86 per diluted share. The net loss in fiscal 2008 included a pre-tax impairment charge of $23.6 million; excluding this charge, fiscal 2008 net income would have been $15 million or $1.22 per diluted share.

In Courier’s specialty publishing segment, with consumer spending down and book retailers managing inventories tightly, sales for the year were down 24%. Much of this decline occurred at Creative Homeowner, the business most directly affected by the weak housing market. However, more than 70% of the reduction in Creative Homeowner sales was due to the winding-down of its unprofitable book distribution operation early in 2009, a move which enabled Creative Homeowner to reduce its operating loss substantially from a year ago. The weak economy also affected the publishing segment’s other two businesses, Dover Publications and Research & Education Association (REA), with combined full-year sales at Dover and REA down 12%.

Book manufacturing revenues were down 8%, reflecting declines in educational and religious sales. In education, solid growth in college textbook sales was offset by the effects of widespread budget shortfalls at the elementary and high school levels. Religious sales were also down for the year, reflecting the recession’s impact on religious donations. In specialty trade, the company’s successful pursuit of new customers enabled a modest rise in sales despite overall market weakness.

“As expected, we did better in the fourth quarter than earlier in the year,” said Courier Chairman and Chief Executive Officer James F. Conway III. “While we continued to wrestle with the worst recession in decades, we were helped by the tough measures we took early in the downturn to reduce operating costs and align our capacity with market conditions. In addition to winding down Creative Homeowner’s distribution operation, those measures included closing a small one-color book manufacturing plant, consolidating one-color work at other manufacturing facilities and reducing our overall employee base by 12%. Equally important, we did all this without compromising either our service to customers or our investment in the future.
 

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