Courier Corp. Sales, Income Up in Third Quarter
"With consumers and businesses still skittish about the economy, we expected a challenging quarter," said Courier Chairman and Chief Executive Officer James F. Conway III. "Fortunately, we were able to play to our strengths as a book manufacturer while modestly improving financial performance in our publishing segment despite the soft retail environment.
"At the same time, we kept our eye on the longer-term outlook and continued to build on what is already an exceptionally efficient array of manufacturing capabilities. Working closely with HP, we brought our digital inkjet system up to speed in one-color, then moved on to four-color production with a minimum of startup pains. In addition, having committed to a fourth high-speed manroland press in April to serve our burgeoning business in four-color textbooks, we have now reached agreement on a second digital system from HP, which will enable us to deliver offset quality across a growing range of short-run applications.
"Our publishing businesses still face an uncertain sales environment and a persistent shortfall in consumer confidence. In response, we continue to tailor both our titles and our promotions to capture the positives within that environment. And we continue to find new ways to make our publishing operations nimbler and more efficient, from innovations in web marketing to a recent consolidation of distribution facilities. I am confident that when the environment improves, we will be ready to take advantage of it.
"In the meantime, our balance sheet remains strong, with debt still at a modest level despite this new round of technology investment. In keeping with our performance and prospects, I'm pleased to announce that once again, Courier's Board of Directors has voted to declare our regular quarterly dividend of $.21 per common share."
Book manufacturing: four-color growth drives expansion plans
Courier's book manufacturing segment had third-quarter sales of $56.8 million, up 8% from $52.7 million in fiscal 2009's third quarter. The segment's operating income was $3.7 million, virtually flat from last year's third quarter. Gross profit in the segment was $10.0 million, or 18% of sales, versus $9.9 million, or 19% of sales, in the third quarter of fiscal 2009, reflecting the very competitive pricing environment as well as approximately $500,000 in startup costs related to the company's new digital operation, Courier Digital Solutions.