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Courier Reports Sales Up, Earnings Down Due to Plant Closure

April 21, 2011
NORTH CHELMSFORD, MA—April 21, 2011—Courier Corp., one of America’s leading book manufacturers and specialty publishers, announced results for the quarter ended March 26, 2011, the second quarter of its 2011 fiscal year.

Revenues were $62.7 million, up 6 percent from last year’s second-quarter sales of $58.9 million. However, earnings were down sharply due to a combination of factors, including restructuring costs associated with the closing of a one-color printing facility in Stoughton, MA, and the write-down of $750,000 in receivables relating to the bankruptcy of Borders Group Inc.

Overall, Courier reported a net loss for the quarter of $4.8 million, compared to net income of $1.4 million in the second quarter of fiscal 2010. Excluding the restructuring costs and bad-debt provision, net income for the quarter was $350,000.

For the first six months of fiscal 2011, Courier’s revenues were $123.8 million, up 2 percent from fiscal 2010. Net loss for the year to date was $3.2 million vs. net income of $4.2 million in the first half of fiscal 2010. Excluding the second-quarter restructuring costs and bad-debt provision, net income for the first six months of fiscal 2011 was $2.0 million.

The second quarter of Courier’s fiscal year has traditionally been its slowest. This year, earnings were further reduced, in part, by increased depreciation expenses resulting from recent investments to add both four-color offset and digital capacity in anticipation of significantly larger book manufacturing demand over the balance of the year.

In Courier’s book manufacturing segment, sales were up in both the religious and education markets, while trade sales were down, reflecting the ripple effects of Borders’ restructuring and store closings. In Courier’s publishing segment, these effects were much more pronounced, as Borders had accounted for 9 percent of its publishing sales in fiscal 2010’s first half, but only 2 percent in fiscal 2011. Sales were down in the quarter at all three of Courier’s publishing businesses.

“It was a challenging quarter before the Borders announcement, and that made it more so,” said Courier Chairman and CEO James F. Conway III. “We were pleased to be able to grow revenues overall, but disheartened by the need to close our single-color paperback plant in Stoughton in response to the continuing shift in demand from one- to four-color books. We are grateful to our Stoughton employees for their many years of loyal service, and we have done our best to provide as many as possible with new opportunities elsewhere in our organization.
 

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