Schawk Posts Record-High Net IncomeMarch 9, 2011
Gross profit was $178.6 million during 2010, an increase of $7.5 million from the same period of 2009. Full-year 2010 gross profit, as a percentage of sales, increased to 38.8 percent from 37.8 percent in the prior-year period. The full-year improvement in gross profit percent was largely driven by the improved operating leverage resulting from higher sales and certain cost-reduction actions enacted by the Company during 2010.
Selling, general and administrative (SG&A) expenses declined approximately $6.9 million to $124.2 million during 2010 from $131.1 million in 2009. The decline in SG&A expenses year over year was primarily driven by certain cost-reduction activities implemented in 2009 and 2010 partially offset by approximately $1.6 million of business and systems integration expenses related to the Company's information technology and business process improvement initiative.
Schawk reported operating income of $49.6 million in 2010, compared to $35.8 million in 2009. The increase year over year was driven primarily by increases in gross profit and reduced SG&A expense partially offset by the non-recurring indemnity settlement income reported during 2009.
Net income in 2010 was $32.4 million, compared to $19.5 million in 2009. Non-GAAP Adjusted net income was $31.1 million for 2010, compared to $23.1 million on a comparable basis for the prior-year period.
Net income for the full year of 2009 was positively impacted by the receipt of $9.2 million in cash as part of an indemnity claim settlement in connection with the Company's 2005 acquisition of Seven Worldwide Holdings, Inc., of which $5.0 million was reported as income. The favorable after-tax impact was $0.20 per share for the period ended Dec. 31, 2009. On a non-GAAP basis, adjusting for financial impacts relating to the indemnity claim settlement and certain other items as further detailed in this release, 2010 full-year Adjusted net income was $31.1 million, or $1.20 per diluted share, compared to $23.1 million, or $0.93 per diluted share, during the prior-year period, on a comparable basis.
Adjusted EBITDA and Management Adjusted EBITDA Performance
Adjusted EBITDA for full year 2010 was $69.8 million compared to $58.4 million for the comparable period of 2009. Management adjusted EBITDA for full year 2010 was $75.4 million compared to $65.4 million for the prior-year period.
Schawk Inc. is a leading provider of brand development and deployment services, enabling companies of all sizes to connect their brands with consumers. With a global footprint of operations in 18 countries, Schawk helps companies create compelling and consistent brand experiences by providing integrated strategic, creative and executional services across brand touchpoints. Founded in 1953, Schawk is trusted by many of the world's leading organizations to help them achieve global brand consistency. For more information about Schawk, visit www.schawk.com.
Source: Financial release.