Courier Sees Slow Improvement

After completing a fiscal year ended September 26 in which the recession resulted in an 11.2% sales decline and a net loss of $3.1 million, Courier Corp. chairman Jim Conway told analysts that the company “is not holding our breath” on a significant turnaround in the near future. Still, steps taken in fiscal 2009 make Courier better prepared to deal with the challenges in the new fiscal year, CFO Bob Storey said. During the year, Courier closed one printing facility, exited an unprofitable distribution business, and cut its overall workforce by 12%. Those measures, Storey said, will result in $8 million in annual savings. Courier is also spending about half of its $10 million—$14 million capital budget on a new digital printer that executives said will allow Courier to do more short print runs of both hardcover and paperback books. The printer is expected to be operational in the second half of the fiscal year.

On the manufacturing side, the best opportunity for growth continues to be in the college segment, which Conway labeled “a genuine growth market.” He sees little chance that the elhi market will improve in 2010.

Courier's publishing operations—Dover Publications, REA, and Creative Homeowner—could be profitable this year after losing $2.2 million in fiscal 2009. The loss was largely due to the winding down of Creative's distribution business, which also resulted in a decline of $7 million in revenue. Overall, sales dropped 49% at Creative Homeowner in the year as sales to home improvement centers also deteriorated. The publisher is looking for growth outside of the home improvement centers this year. With new and repackaged titles, Courier expects first-quarter growth at REA.

Given the uncertain strength of the economic recovery, Courier expects sales to rise modestly, hitting between $253 million and $268 million this year.

Courier Corp. Results
2008—2009 ($ in millions)