Courier Records Net Income Gain Compared to Net Loss in Q2 2011
“Last year both of our business segments were hit hard in the second quarter by the collapse of Borders,” said Courier Chairman and CEO James F. Conway III. “This year we saw some positive signs that consumers are starting to turn to other book retailers, as shown by our solid growth in book manufacturing sales to the specialty trade market through both the quarter and the first half of the year.
“Nonetheless, we continue to manage costs carefully, aligning our resources with changing markets and seasonal demand patterns. To that end we made further consolidations both in book manufacturing and in our publishing businesses. Helped by these prudent measures and by our continuing strong cash flow, our financial condition remains as strong as ever, with our debt down by $5 million since the start of fiscal 2012 and our $100-million credit facility extended through March 2016.
“In keeping with these achievements, I am pleased to announce that our Board of Directors has approved not only our regular quarterly dividend but also a $10 million stock repurchase program. With our reduced cost structure, our expanding array of digital offerings and our typical pattern of seasonal sales growth, I look forward to a stronger second half of the year.”
Book manufacturing: trade rebound continues
Courier’s book manufacturing segment had second-quarter sales of $55.5 million, comparable to the same period last year. For fiscal 2012 to date, book manufacturing sales were $111.5 million, up 3 percent from fiscal 2011.
On a year-to-date basis, operating income was $7.5 million, up 20 percent from $6.2 million for the first six months of last year. Again excluding restructuring costs, gross profit for the second quarter was $9.1 million, or 16.5 percent of sales, vs. $8.9 million, or 16.1 percent of sales, last year.
Gross profit for the first half of fiscal 2012 was $21.6 million, or 19.4 percent of sales, compared to $20.3 million, or 18.7 percent of sales. This improvement in gross profit margins in a competitive pricing environment reflects a favorable sales mix, operating efficiencies enabled by recent technology investments, and the closing of a redundant one-color plant last March.