PW: AMS Has Record Year, Will Pay Dividend

AMS attributed the sharp rise in earnings to a decline in its return rate, which fell from 28% last year to 21% in fiscal 1998. The company credited the improvement in returns to the introduction of vendor-managed inventory for its two largest customers. During the year, AMS's margins were affected by a modest increase in the sale of internally developed or published titles, which was offset by higher provisions for inventory markdowns. In addition, a reduction in distribution costs were more than offset by increases in certain administrative expenses and reduced cash discount income.

The company's first-ever quarterly dividend, of $0.25, will be payable on June 15 to stockholders of record on June 1. Commenting on the dividend, AMS president Michael Nicita said that "given the fundamental strength of our business, we believe that the institution of a regular dividend will in no way compromise our overall growth strategies."