Educational Development Corporation, one of the smaller publicly-traded publishers, issued a release last week to announce it received a $1.44 million loan under the Paycheck Protection Program. The program provides loans to small businesses that will be forgiven as long as a company meets certain employee staffing requirements. EDC CEO Randall White said he expects “a significant portion” of the loan to be eligible for forgiveness.
In comments accompanying the release, White said the company applied for the loan because its publishing division “has been significantly impacted” by the stay-at-home orders that have been implemented in the majority of states in the country in an effort to combat the spread of the new coronavirus. White also said that, in the Usborne Books & More sales division, sales to schools and libraries as well as to book fairs have been “significantly impacted by school closures across the country.”
White said EDC has seen growth in some areas, particularly in its the direct-to-consumer sales channel, which is its largest channel. “With the thousands and thousands of parents at home with their children, the need for educational children's books and boredom-busting activities, like books and puzzles, has dramatically increased,” White said.
Given the differing performances of its businesses, White said EDC is uncertain what impact the coronavirus will have on financial results for the quarter ending in May. EDC’s fiscal 2020 year ended February 29, but it has not yet released results. White said EDC is "grateful that our business is considered 'essential' for customers and the economy. We are receiving and shipping orders every day which allows us to pay our employees and the thousands of individual consultants that sell our products.”