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Visant’s Net Income Slumps on Nearly Flat Net Sales

August 11, 2011

The Marketing and Publishing Services segment reported Adjusted EBITDA of $19.5 million, a decrease of $3.6 million compared to $23.1 million for the second fiscal quarter of 2010. This decrease was primarily due to lower volume in our publishing services operations.

Net sales of our Scholastic segment for the six months ended July 2, 2011 increased by $2.6 million, or 1 percent, to $292.0 million compared to $289.4 million for the six months ended July 3, 2010. This increase was primarily attributable to higher volume and prices in our jewelry products.

Net sales for the Memory Book segment were $274.4 million for the six-month period ended July 2, 2011, a decrease of 3 percent, compared to $283.7 million for the six-month period ended July 3, 2010. This decrease was primarily attributable to lower volume.

Net sales of the Marketing and Publishing Services segment decreased $14.5 million, or 8 percent, to $177.5 million for the first six months of fiscal 2011 compared to $192.0 million during the first six months of fiscal 2010. This decrease was primarily attributable to lower volume in our publishing services operations offset by the impact of higher sampling sales including those from the acquisition of Color Optics.

For the six months ended July 2, 2011, the Scholastic segment reported Adjusted EBITDA of $63.9 million, an increase of $1.4 million, or 2 percent, compared to $62.5 million for the prior year comparative period. The increase was primarily due to the impact of cost reduction initiatives.

Our Memory Book segment reported Adjusted EBITDA of $136.5 million for the six months ended July 2, 2011, a decrease of $2.8 million, or 2 percent, compared to $139.3 million for the six months ended July 3, 2010. This decrease was primarily due to lower volume.

The Marketing and Publishing Services segment reported Adjusted EBITDA of $39.6 million for the six months ended July 2, 2011, a decrease of $9.6 million, or 19 percent, compared to $49.2 million for the prior year comparative period. This decrease was primarily due to lower volume in our publishing services operations.

As of July 2, 2011, Visant’s consolidated debt, comprised of the outstanding indebtedness under its senior secured credit facilities and its 10.00 percent senior notes due 2017, was $2,004.8 million, including $14.2 million of capital lease and equipment financing obligations and exclusive of original issue discount of $22.1 million related to the term loan under the senior secured credit facilities. Visant’s cash position as of July 2, 2011 totaled $53.0 million.

Visant has provided a reconciliation of net income to Adjusted EBITDA and EBITDA to Adjusted EBITDA in the accompanying summary of financial data.

Supplemental data has also been provided for Visant’s three segments: Scholastic, Memory Book and Marketing and Publishing Services.

About Visant

Visant is a leading marketing and publishing services enterprise servicing the school affinity, direct marketing, fragrance and cosmetics, and educational and trade publishing segments.

The company has three reportable segments:

Scholastic—provides services in conjunction with the marketing, sale and production of class rings and an array of graduation products and other scholastic affinity products to students and administrators primarily in high schools, colleges and other post-secondary institutions.

Memory Book—provides services in conjunction with the publication, marketing, sale and production of school yearbooks, memory books and related products that help people tell their stories and chronicle important events.

Marketing and Publishing Services—provides services in conjunction with the development, marketing, sale and production of multi-sensory and interactive advertising sampling systems, primarily for the fragrance, cosmetics and personal care segments, and provides innovative products and related services to the direct marketing sector. The group also produces book components primarily for the educational and trade publishing segments.

Source: Visant.
 

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