Midlothian, Texas, supplier Ennis, Inc. has released its financial results for the three and nine months ended November 30, 2016. The financial overview is for the continuing operation of the company, which is comprised of the production and sale of business forms and other business products, and it excludes the discontinued operations of the former Alstyle apparel segment.
The company’s net sales for the third quarter ended November 30, 2016, were $88.7 million compared to $97.5 million for the same quarter last year, a decrease of nine percent. Gross profit margin was $25.3 million, or 28.5 percent, as compared to 29.6 percent for the sequential quarter and 30.5 percent for the same quarter last year. Diluted earnings per share were $0.22, compared to $0.33 for the same quarter last year.
Operational results were affected by a $2 million charge for increased medical expenses incurred during the quarter. Excluding this charge, on a non-GAAP basis, for the quarter, adjusted gross profit margin would have been 30.1 percent ($26.6 million), adjusted net earnings would have been $7 million and adjusted diluted earnings per share would have been $0.27.
The company’s net sales for the nine-month period ended November 30, 2016 were $270.3 million compared to $294.7 million for the same period last year, a decrease of 8.3 percent. Gross profit margin was $79.0 million, or 29.2 percent, as compared to $91.0 million, or 30.9 percent for the same period last year.
Diluted earnings per share for the nine-month period were $0.74, compared to $1.05 for last year’s comparable period. Operational results for the period were affected by the Folder Express relocation of $2.7 million, incurred prior to the quarter, and the aggregate increased medical expenses of $4.3 million incurred during current and previous quarters. Excluding these charges, on a non-GAAP basis, for the nine months ended November 30, 2016 adjusted gross profit margin would have been 31.4 percent ($84.9 million), adjusted net earnings would have been $23.6 million and adjusted diluted earnings per share would have been $0.91.
During the third quarter, the company generated EBITDA (a non-GAAP financial measure) of $12.4 million compared to $16.8 million for the comparable quarter last year. For the nine-month period ended November 30, 2016, the company generated $40.3 million of EBITDA compared to $52.0 million for the comparable period last year. Excluding both the impact of the Folder Express relocation and the aggregate increased medical expenses, on a non-GAAP basis, the company generated adjusted EBITDA of $14.4 million, or 16.2 percent of sales for the three months and $47.3 million, or 17.5 percent of sales for the nine months ended November 30, 2016.
Earnings from the discontinued operations of Alstyle apparel during the nine-month period were $0.10, compared to $0.15 for the same period last year. The combined results for continued and discontinued operations for the nine months were $0.84 per diluted share compared to $1.20 for the same period in 2015. The net loss resulting from the sale of the apparel operations, net of tax, was $26 million, or a loss of $1.01 per share, which included the write-off of $16 million for foreign currency translation adjustments, or $10.3 million, net of taxes. As a result, on a combined basis, for the nine-month period the company’s continuing and discontinued operations realized a net loss of $4.4 million, or a loss of $0.17 per diluted share compared to net earnings of $30.9 million, or $1.20 per diluted share for 2016 and 2015, respectively.
