Courier Corp. finished the fiscal year ended September 27, 2014 with a 5% increase in sales, to $283.3 million, although net income fell to $7.8 million from $11.2 million in fiscal 2013. The bulk of the earnings decline was attributed to FastPencil, the self-publishing company the Courier acquired in April 2013. Not only did FastPencil have an operating loss for the year, But Courier also took a $6 million writedown associated with the purchase.
The poor showing by FastPencil hurt overall profits in Courier’s manufacturing segment which posted a 4.5% increase in revenue, to $258.7 million, but earnings fell to $18.2 million from $21.9 million. In addition to losses from FastPencil, Courier CEO James Conway said that pricing pressures dampened earnings in the manufacturing segment in the year.
In the book publishing division, sales fell slightly, to $33.2 million from $33.6 million and the net loss was trimmed to $187,000 from $1.7 million in fiscal 2013. Results now include only Dover Publications and REA since Courier excludes results from Creative Homeowner which Courier sold to Fox Chapel earlier this year. Conway attributed the improvement in the bottomline in the publishing segment to higher e-book sales that have helped boost profits plus continued cost containment measures.
In the manufacturing segment, sales were up in all three of the company’s areas: religion, education and trade. Digital print sales were up by double-digits in the year, Conway said, “reflecting demand for customized textbooks and the appeal of offset-quality digital print for shorter runs.”
For the next fiscal year Courier expects to see revenue grow to between $300 million and $318 million and earnings per share to fall between 70 cents and $1 compared to earnings from continuing operations of 89 cents per share.