Multi-Color Corp. revenue, profits drop in Q2 FY2010
Label printer/converter sees 8% decline in sales volume; will relocate HQ to Batavia, OH.
PRESS RELEASE -- Converting Magazine, 11/5/2009 10:19:02 AM
Multi-Color Corp. announced diluted earnings per share of 28 cents for its second quarter ended September 30, 2009, down 15% from the prior year. Second quarter highlights included: -- Net revenues decreased 11% to $72.0 million from $80.6 million. The decrease in revenues was due to an 8% decline in sales volume, a 2% unfavorable pricing impact and a 1% unfavorable foreign exchange impact. The majority of the sales volume decline was due to market share declines experienced by our customers' brands.
-- Gross profit decreased 13% to $12.8 million from $14.7 million primarily due to the decline in revenues. However, gross margins were maintained at 18% of revenues due to improved operating efficiencies and fixed cost reductions.
-- Selling, general and administrative expenses decreased 4% to $6.7 million from $7.0 million and were held to 9% of revenues in both periods.
-- Operating income decreased 21% to $6.1 million from $7.7 million due to the decline in revenues.
-- Interest expense decreased 32% to $1.3 from $1.9 million due to a reduction in bank debt of $5.3 million and lower interest rates.
-- Net income from continuing operations decreased 17% to $3.4 million from $4.1 million.
-- Earnings Per Share (EPS) from continuing operations decreased 15% to 28 cents per diluted share from 33 cents.
-- The Company was recognized on the Forbes Listing of America's 200 Best Small Companies for the third consecutive year.
"Despite the challenging environment, we generated a significant increase in cash flow during the first half of the year which has allowed us to reduce outstanding debt by approximately $10 million. We continue to focus on cost reduction actions and improving operating efficiencies to mitigate the impacts of lower revenues. Our view for the balance of the fiscal year remains cautious as we continue to experience a weak revenue growth environment," said Frank Gerace, President and CEO of Multi-Color Corporation.
For the six month period ended September 30, 2009, Multi-Color's net revenues decreased 12% to $141.6 million from $160.1 million due to an 8% decline in sales volume, a 3% unfavorable foreign exchange impact and a 1% unfavorable pricing impact. Net income from continuing operations increased 6% to $ 7.4 million and EPS from continuing operations was 60 cents per diluted share for the six months ended September 30, 2009.
In addition, the Company will relocate its Corporate Headquarters from Sharonville, Ohio to its Batavia, Ohio facility during the third quarter ending December 31, 2009. In connection with the relocation, the Company will record an estimated charge of approximately $1.1 million to $1.5 million for remaining lease obligations related to its Sharonville facility.
Multi-Color Corp. sales up, profits down
02/02/2009
