Segment Information and Geographic Information

3 Months Ended

May 31, 2014

Segment Reporting [Abstract]

Segment Information and Geographic Information

12. Segment Information and Geographic Information

The Company operates in two segments–the Print Segment and the Apparel Segment.

The Print Segment, which represented 63% of the Company’s consolidated net sales for the three months ended May 31, 2014, is in the business of manufacturing, designing, and selling business forms and other printed business products primarily to distributors located in the United States. The Print Segment operates 50 manufacturing plants throughout the United States in 21 strategically located states. Approximately 95% of the business products manufactured by the Print Segment are custom and semi-custom products, constructed in a wide variety of sizes, colors, number of parts and quantities on an individual job basis depending upon the customers’ specifications.

The products sold include snap sets, continuous forms, laser cut sheets, tags, labels, envelopes, integrated products, jumbo rolls and pressure sensitive products in short, medium and long runs under the following labels: Ennis^®, Royal Business Forms^®, Block Graphics^®, Specialized Printed Forms^®, 360º Custom Labels^SM, ColorWorx^®, Enfusion^®, Uncompromised Check Solutions^®, VersaSeal^®, Witt Printing^®, B&D Litho^®, Genforms^®, PrintGraphics^SM, Calibrated Forms^®, PrintXcel^SM, and Printegra^®. The Print Segment also sells the Adams-McClure^® brand (which provides Point of Purchase advertising for large franchise and fast food chains as well as kitting and fulfillment); the Admore^® and Folder Express^® brands (which provide presentation folders and document folders); Ennis Tag & Label^SM (which provides custom printer high performance labels and custom and stock tags); Atlas Tag & Label^® (which provides custom and stock tags and labels); Trade Envelopes^® and Block Graphics^®, Wisco^® and National Imprint Corporation^® (which provide custom and imprinted envelopes) and Northstar^® and General Financial Supply^® (which provide financial and security documents).

The Print Segment sells predominantly through private printers and independent distributors. Northstar also sells direct to a small number of customers. Northstar has continued its focus with large banking organizations on a direct basis (where a distributor is not acceptable or available to the end-user) and has acquired several of the top 25 banks in the United States as customers and is actively working on other large banks within the top 25 tier of banks in the United States. Adams-McClure sales are generally provided through advertising agencies. Assets in this segment increased in 2014 primarily as a result of the Company’s acquisition of Wisco, NIC and Folder Express.

The Apparel Segment, which accounted for 37% of the Company’s consolidated net sales for the three months ended May 31, 2014, consists of Alstyle Apparel. This group is primarily engaged in the production and sale of activewear including t-shirts, fleece goods, and other wearables. Alstyle sales are seasonal, with sales in the first and second quarters generally being the highest. Substantially all of the Apparel Segment sales are to customers in the United States.

Corporate information is included to reconcile segment data to the consolidated financial statements and includes assets and expenses related to the Company’s corporate headquarters and other administrative costs.

Segment data for the three months ended May 31, 2014 and May 31, 2013 were as follows (in thousands):

	Print		Apparel					Consolidated
	Segment		Segment		Corporate			Totals
Three months ended May 31, 2014:
Net sales	$	88,384	$	52,802	$	—		$	141,186
Depreciation		1,564		951		67			2,582
Amortization of identifiable intangibles		1,050		367		—			1,417
Segment earnings (loss) before income tax		15,482		1,176		(3,909	)		12,749
Segment assets		218,534		307,296		16,061			541,891
Capital expenditures		252		47		6			305

	Print		Apparel					Consolidated
	Segment		Segment		Corporate			Totals
Three months ended May 31, 2013:
Net sales	$	81,439	$	57,027	$	—		$	138,466
Depreciation		1,377		970		40			2,387
Amortization of identifiable intangibles		428		367		—			795
Segment earnings (loss) before income tax		13,447		4,368		(4,312	)		13,503
Segment assets		161,672		307,420		20,325			489,417
Capital expenditures		479		150		40			669

Identifiable long-lived assets by country include property, plant, and equipment, net of accumulated depreciation. The Company attributes revenues from external customers to individual geographic areas based on the country where the sale originated. Information about the Company’s operations in different geographic areas as of and for the three months ended is as follows (in thousands):

	United States		Canada		Mexico		Total
Three months ended May 31, 2014:
Net sales to unaffiliated customers
Print Segment	$	88,384	$	—	$	—	$	88,384
Apparel Segment		48,002		4,627		173		52,802
	$	136,386	$	4,627	$	173	$	141,186
Identifiable long-lived assets
Print Segment	$	42,537	$	—	$	—	$	42,537
Apparel Segment		128		39		43,813		43,980
Corporate		3,711		—		—		3,711
	$	46,376	$	39	$	43,813	$	90,228
Three months ended May 31, 2013:
Net sales to unaffiliated customers
Print Segment	$	81,439	$	—	$	—	$	81,439
Apparel Segment		51,702		5,262		63		57,027
	$	133,141	$	5,262	$	63	$	138,466
Identifiable long-lived assets
Print Segment	$	39,499	$	—	$	—	$	39,499
Apparel Segment		215		48		46,978		47,241
Corporate		3,303		—		—		3,303
	$	43,017	$	48	$	46,978	$	90,043