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AMERICAN GREETINGS REPORTS BEST SECOND QUARTER IN 87-YEAR HISTORY

 CLEVELAND, Sept. 14 /PRNewswire/ -- Record revenue, net income and net income per share for the second quarter of Fiscal 1994 were reported today by American Greetings (NASDAQ: AGREA).
 Total revenue for the second quarter ended Aug. 31, 1993, increased 4.8 percent to $388.4 million, up from $370.6 million reported during the same period a year ago. Pre-tax income for the quarter increased substantially over last year's second quarter, up 17.4 percent from $14.9 million to $17.5 million.
 Net income was also significantly higher, up 22.8 percent to $10.9 million from $8.9 million in the second quarter last year. Net income per share for the quarter was 29 cents compared to 24 cents a year ago, or 15 cents per share compared to a restated 12 cents a year ago after the company's 2-for-1 stock split on September 10.
 "Despite a sluggish retail environment, we had an outstanding second quarter and we expect our momentum to continue," Chairman and Chief Executive Officer Morry Weiss said. "Our strong second quarter keeps us on track for another record year."
 Total revenue for the first six months of Fiscal 1994 increased 5.0 percent to $783.8 million, up from $746.7 million during the same period a year ago. Pre-tax income for the first half, before the effect of accounting changes, improved from $54.9 million last year to $63.9 million, up 16.5 percent.
 Income from operations in the first half, before the effect of accounting changes, increased 16.1 percent to $39.9 million, up from $34.4 million last year. Income per share before the accounting changes increased to $1.08 in the first half versus 95 cents a year ago, or 54 cents per share compared to a restated 48 cents a year ago after the stock split.
 The company adopted FASB Statements No. 106 and 109 during the first quarter, which resulted in a one-time net charge of $17.2 million against earnings. As a result, net income for the first half was $22.8 million and net income per share was 61 cents, or 31 cents after the stock split.
 "Our overall business is very strong, and excellent sales of everyday and seasonal greeting cards, our core products, continue to drive our success," President and Chief Operating Officer Ed Fruchtenbaum said.
 "In addition, our rollout of CreataCard continues on pace. By the end of our fiscal year, we will have at least 6,000 units in the marketplace and CreataCard should be modestly profitable. Consumers are becoming more familiar with the kiosks and sales should improve as we continue to roll out the new 3-foot-wide units, a credit card option and several new card lines."
 Fruchtenbaum also attributed the strong second quarter results to on-going re-engineering of the company's product development process to strengthen the linkage from the creative area through product testing to Just-in-Time manufacturing plants to the delivery of greeting cards and related social expression products in the marketplace.
 Fruchtenbaum added that the company is managing its balance sheet effectively. Total inventories, as of August 31, were down $30.4 million from a year ago while revenues increased.
 The company doubled the number of its outstanding shares on September 10 from 36.9 million to 73.8 million as the result of the 2-for-1 stock split announced on June 25. The company also raised its dividend 16.3 percent on a pre-split basis from 21.5 cents to 25 cents, or 12.5 cents per share after the split. The stock split and dividend increase, which was paid on September 10, were for shareholders of record on August 27.
 Also during the quarter, the company completed its acquisition of Magnivision, the leading manufacturer and distributor of over-the-counter, non-prescription reading glasses in the United States and 15 other countries. The integration of Magnivision into the company is going smoothly.
 The company also secured a long-term licensing agreement with Amcor Limited to supply its greeting card subsidiaries, Murfett Regency and John Sands. Murfett and John Sands are the largest greeting card suppliers in Australia and New Zealand.
 American Greetings, a Fortune 300 firm, is the world's largest publicly owned manufacturer and distributor of greeting cards and related social expression products.
 AMERICAN GREETINGS CORPORATION
 SECOND QUARTER REPORT OF CONSOLIDATED REVENUE AND INCOME
 FISCAL YEAR ENDING FEBRUARY 28, 1994
 (In thousands of dollars except per share amounts)
 (Unaudited)
 Three Months Ended Percent
 August 31, Increase
 1993 1992
 Total revenue $ 388,381 $ 370,624 4.8
 Income before income taxes 17,470 14,887 17.4
 Income taxes 6,551 5,993 9.3
 Net income 10,919 8,894 22.8
 Per share:
 Before stock split .29 .24 20.8
 After stock split .15 .12 25.0
 Average number of common
 shares outstanding:
 Before stock split 36,874,454 36,085,018
 After stock split 73,748,908 72,170,036
 (Unaudited)
 Six Months Ended Percent
 August 31, Increase
 1993 1992
 Total revenue $ 783,822 $ 746,686 5.0
 Income before income taxes
 and cumulative effect of
 accounting changes 63,914 54,881 16.5
 Income taxes 23,968 20,471 17.1
 Income before cumulative
 effect of accounting
 changes 39,946 34,410 16.1
 Cumulative effect of accounting
 changes, net of tax 17,182 $ -
 Net Income $ 22,764 $ 34,410
 Per share before stock split:
 Income before cumulative
 effect of accounting
 changes 1.08 .95 13.7
 Cumulative effect of
 accounting changes,
 net of tax .47 -
 Per share .61 .95
 Per share after stock split:
 Income before cumulative
 effect of accounting changes .54 .48 12.5
 Cumulative effect of accounting
 changes, net of tax .23 -
 Per share .31 .48
 Average number of common
 shares outstanding:
 Before stock split 36,728,371 36,040,172
 After stock split 73,456,742 72,080,344
 -0- 9/14/93
 /CONTACT: John D. Barker of American Greetings, 216-252-4864/
 (AGREA)


CO: American Greetings ST: Ohio IN: HOU SU: ERN

BM -- CL015 -- 1799 09/14/93 13:36 EDT
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Publication:PR Newswire
Date:Sep 14, 1993
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