Ennis, Inc. Reports First Quarter Fiscal 2025 Financial Results and Declares Quarterly Dividend
Ennis, one of the nation’s largest private-label printed business product suppliers and manufacturers, today announced its financial results for the first fiscal quarter ended May 31, 2025, along with the declaration of its quarterly cash dividend. The results reflect continued strategic resilience amid industry headwinds and illustrate Ennis’s commitment to disciplined financial stewardship, growth through acquisitions, and consistent shareholder returns.
Financial Performance Overview
During the first quarter of fiscal year 2025, Ennis generated total revenues of $97.2 million, reflecting a decline of 5.7% or $5.9 million compared to $103.1 million for the same period in fiscal 2024. Despite the revenue dip, Ennis maintained solid profitability, a testament to the company’s well-executed cost control measures and pricing discipline.
Gross profit for the quarter stood at $30.2 million, slightly below the $30.9 million reported in the prior year’s comparable quarter. However, gross margin improved to 31.1%, up from 30.0% in Q1 FY2024 and 29.5% in the fourth quarter of the prior fiscal year. This upward trend underscores the company’s ability to enhance operational efficiency and margin performance even amid sales headwinds.
Net earnings for the first quarter totaled $9.8 million, or $0.38 per diluted share, compared to $10.7 million, or $0.41 per diluted share, in the prior year’s first quarter. While the bottom line showed a modest decline, the company maintained healthy profitability despite industry-wide softness in demand for print and envelope products.
CEO Commentary: Strategic Focus and Cost Discipline
Keith Walters, Ennis Chairman, CEO, and President, commented on the quarter’s performance:
Our first quarter results were in line with expectations and reflected the core strengths of our business. While sales were down year-over-year, we were able to improve our gross profit margin to 31.1%, up from 30.0% in Q1 last year and 29.5% last quarter. This is a direct result of our disciplined approach to cost control, pricing strategy, and operational efficiencies. Our EBITDA for the quarter increased to $17.7 million, or 18.2% of sales, compared to $16.5 million or 17.8% in Q4 last year. Although EBITDA declined slightly from $19.0 million or 18.4% in Q1 of last year, our margin strength remains a positive highlight.
Ennis’s first quarter performance illustrates that while total revenues were impacted by lower industry demand, the company has managed to offset much of the financial impact through its strategic approach to acquisitions, margin control, and forward-looking inventory management.
Acquisition Impact and Integration Success
Ennis’s growth strategy continues to include targeted acquisitions that strengthen its market reach and operational capacity. Two recent acquisitions contributed notably to the first quarter results:
- Northeastern Envelope Company (NEC), acquired midway through the quarter, added approximately $5.5 million in revenue and boosted diluted earnings per share by $0.035. NEC, based in Old Forge, Pennsylvania, is a prominent commercial envelope manufacturer offering a wide array of specialty window envelopes with next-day shipping capabilities.
- Printing Technologies, Inc. (PTI), acquired in Q2 of fiscal 2024, has now been fully integrated into the Ennis ERP system and continues to perform strongly, aligning with expectations and driving operational synergies.
- These acquisitions not only add immediate top-line contributions but are strategically aligned with our core capabilities,” Walters added. “Our ability to successfully integrate acquired businesses while preserving profitability and cash flow has proven to be a significant differentiator.
Market Conditions and Strategic Inventory Management
Ennis also reported developments that may have broader implications for the paper products segment of its business. The only domestic mill producing carbonless paper has announced its intention to cease operations later this calendar year. This potential supply disruption could impact a significant portion of the industry that relies on carbonless paper for multi-part forms and other business-critical documents.
In response, Ennis is proactively building inventory reserves to ensure uninterrupted service to its customer base. The company has invested heavily in procuring alternate sources of carbonless paper and increasing stock to manage potential future constraints.
We are acting decisively to mitigate supply risks. Our investments in inventory are an essential safeguard against potential disruptions and demonstrate our commitment to customer reliability,” said Walters.
This strategic move has, however, contributed to a decline in interest income, as excess cash was redeployed into working capital and acquisition activities. Interest income fell to $0.6 million during the quarter, down from $1.4 million in the same period last year. Still, the decision aligns with Ennis’s long-term strategic priorities.
Capital Allocation and Shareholder Returns
Ennis continues to prioritize shareholder value creation through its capital allocation strategy, which includes dividend payments, share repurchases, and debt-free growth.
During the first quarter, Ennis repurchased 260,560 shares of common stock on the open market at an average price of $19.00 per share, reinforcing its confidence in long-term valuation. Despite these investments and acquisitions, the company maintains a strong financial position with $32.0 million in cash and no debt.
Our capital allocation strategy is rooted in long-term sustainability,” noted Walters. “We remain debt-free, which not only gives us stability in uncertain markets but also provides the flexibility to pursue larger acquisitions if and when the right opportunities arise.
In line with its consistent dividend history, the company declared its regular quarterly dividend, reinforcing its commitment to delivering predictable and ongoing returns to shareholders.
Non-GAAP Financial Measures: Insight into EBITDA and Adjusted Metrics
As part of its effort to provide transparent and relevant financial disclosures, Ennis continues to report non-GAAP financial measures, including EBITDA and adjusted earnings metrics, as supplemental tools for evaluating the performance of its operations.
For the first quarter of fiscal 2025:
- EBITDA totaled $17.7 million, representing 18.2% of net sales, compared to $19.0 million (18.4%) in the prior year quarter and $16.5 million (17.8%) in the previous quarter.
These metrics help investors and management better assess operating performance, excluding the impact of interest, taxes, depreciation, and amortization, which can vary across reporting periods based on non-operating factors.
Ennis emphasizes that while these non-GAAP figures offer additional insights, they are not intended to replace GAAP-compliant financial reporting. Management believes these measures enhance comparability and enable stakeholders to make more informed evaluations of the company’s operational results.
While we continue to generate strong GAAP financial results, the use of supplemental non-GAAP metrics allows us to measure performance in a way that supports strategic decision-making and business analysis,” Walters explained. “That said, we always urge investors to consider these figures in conjunction with our full GAAP disclosures.
Commitment to Long-Term Growth
Ennis remains focused on operational discipline, innovation in print solutions, and intelligent capital deployment. As the print and document industry evolves with the integration of digital technologies, the company continues to assess opportunities that align with its niche market strengths.
Despite current headwinds, including industry consolidation and declining demand in certain sectors, Ennis is well-positioned to grow through focused acquisitions, targeted capacity expansion, and adaptive supply chain management.
We believe our consistent approach to profitability, our strong financial position, and our customer-first philosophy will continue to serve us well,” concluded Walters. “Our goal remains unchanged—to deliver long-term value to shareholders while navigating market changes with agility and foresight.
