Click here to close now.




















Welcome!

News Feed Item

Standard Register Reports First Quarter 2014 Financial Results

Standard Register (NYSE: SR) today announced its financial results for the first quarter of 2014. The Company reported revenue of $228.5 million and a net loss of $7.1 million or $0.83 per diluted share. The results compare to revenue of $141.6 million for the first quarter of 2013 and net income of $4.7 million or $0.80 per diluted share.

Adjusted EBITDA, which excludes certain items as detailed in the attached reconciliation, was $13.2 million compared to $12.2 million for the first quarter of 2013.

Results for the first quarter of 2013 do not include results from WorkflowOne, which Standard Register acquired on August 1, 2013.

“Although we are not satisfied with the overall results, first-quarter revenue increased in a number of our growth solutions,” said Joseph P. Morgan, Jr., president and chief executive officer. “We are investing in the growing areas of our business and have a healthy pipeline. However, many of our solutions have long sales cycles and lengthy customized implementations, which delay realization of revenue. Throughout 2014, we will be focused on driving sales of our entire portfolio into our large customer base. The acquisition brought us many new opportunities and the integration is proceeding on track with, and in some respects ahead of our internal plan.”

First Quarter Results
Total revenue increased 61 percent to $228.5 million compared to $141.6 million in the 2013 first quarter. On a pro forma basis, including WorkflowOne revenue for the first quarter of 2013, the Company would have reported revenue of $253.7 million.

Gross Margin as a percentage of revenue was 27.3 percent, compared to 29.6 percent for the first quarter last year. Unit and volume decreases, and costs associated with integration of the acquisition contributed to the decrease in gross margin. Selling, general and administrative (SG&A) expenses were $58.7 million compared to $34.7 million for the first quarter last year. The increase is primarily attributable to the acquisition and integration.

The Company incurred $5.5 million of additional expense in the first quarter of 2014 related to executing the acquisition, restructuring and integration. Capital expenditures were $3.6 million compared to $3.9 million in the first quarter last year. The Company expects to invest approximately $15 to $21 million in 2014 capital expenditures.

Standard Register contributed $5.9 million to the Company’s qualified pension plan in the first quarter of 2014 compared to $5.8 million in the first quarter last year. Total pension contributions to meet minimum funding requirements for 2014 are expected to be $42.0 million compared to contributions of $24.7 million for 2013.

Standard Register operates two business units: Healthcare and Business Solutions.

Healthcare revenue was $64.8 million, an increase of 31 percent over revenue of $49.5 million in the first quarter of 2013. Technology-enabled patient information systems continued a double-digit growth rate in the first quarter, however regulatory changes in requirements for distribution of printed materials, and a large kitting project in the first quarter of 2013 also impacted the overall comparable business unit results. Operating profit was $1.9 million compared to $2.1 million in the 2013 first quarter.

Business Solutions revenue was $163.7 million, an increase of 78 percent over revenue of $92.1 million in the 2013 first quarter. The increase was attributable to business added from the acquisition and growth in revenue from Mexico-based label manufacturing operations. Declines in demand for traditional printed forms and transactional documents continue to outpace growth in the other solutions in the business unit performance. Operating profit was $1.4 million compared to $2.9 million in the 2013 first quarter.

First Quarter Highlights

  • The acquisition integration process is proceeding on track with internal plans and the Company is beginning to realize expected synergies. In the first quarter of 2014, systems and data centers were integrated, headcount reduced, three production facilities closed and three warehouse facilities closed.
  • The first of two high-speed ink jet presses was installed in Sacramento, California. The second, larger press was delivered to Columbus, Ohio, early in April. Both are expected to contribute to customer communications solutions sales during 2014.
  • An efficient consolidation of the Dayton workforce into one headquarters location will result in significant savings as the lease of the former WorkflowOne offices has been assigned.
  • Standard Register Healthcare launched an innovative SMARTworks® EffectiveResponse solution for patient follow-up, an important accountable care requirement for healthcare providers.
  • The Company’s Mexico-based operations received a supplier award from Carrier Mexico for superior quality performance, including 100 percent on-time delivery.
  • Standard Register’s Product Marking and Labeling launched the first on-demand labeling solution to allow businesses to order durable UL/CUL approved digital labels online economically, regardless of volume, to address a significant pain point for the industry.

Conference Call
Standard Register’s president and chief executive officer Joseph P. Morgan, Jr., and chief financial officer Robert Ginnan will host a conference call at 10:00 a.m. EDT on Friday, April 25, 2014, to review the first quarter results. The call can be accessed via an audio webcast at http://www.standardregister.com.

About Standard Register
Standard Register (NYSE:SR), is trusted by the world’s leading companies to advance their reputations and add value to their operations by aligning communications with corporate brand standards. Providing market-specific insights and a compelling portfolio of workflow, content and analytics solutions to address the changing business landscape in healthcare, financial services, manufacturing, transportation and retail markets, Standard Register is the recognized leader in the management and execution of mission-critical communications. More information is available at http://www.standardregister.com.

Safe Harbor Statement
This press release contains forward-looking statements covered by the Private Securities Litigation Reform Act of 1995. Because such statements deal with future events, they are subject to various risks and uncertainties and actual results could differ materially from the Company’s current expectations. Factors that could cause the Company’s results to differ materially from those expressed in forward-looking statements include, without limitation, our ability to successfully integrate the acquired assets or achieve the expected synergies of the WorkflowOne acquisition, access to capital for expanding in our solutions, the pace at which digital technologies and electronic health records (EHR) adoption erode the demand for certain products and services, the success of our plans to deal with the threats and opportunities brought by digital technology, results of cost containment strategies and restructuring programs, our ability to attract and retain key personnel, variation in demand and acceptance of the Company’s products and services, frequency, magnitude and timing of paper and other raw material price changes, the timing of the completion and integration of acquisitions, general business and economic conditions beyond the Company’s control, and the consequences of competitive factors in the marketplace, including the ability to attract and retain customers. The Company undertakes no obligation to revise or update forward-looking statements as a result of new information, since these statements may no longer be accurate or timely. For more information, see the Company’s most recent Form 10-K and other filings with the Securities and Exchange Commission.

Non-GAAP Measures Presented in This Press Release
The Company reports its results in accordance with Generally Accepted Accounting Principles in the United States (GAAP). However, we believe that certain non-GAAP measures found in this press release, when presented in conjunction with comparable GAAP measures, are useful for investors. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows where amounts are either excluded or included, not in accordance with generally accepted accounting principles. We discuss several measures of operating performance, including Adjusted EBITDA and cash flow on a net debt basis, which are not calculated in accordance with GAAP. These non-GAAP measures should not be considered as substitutes for, or superior to, results determined in accordance with GAAP.

Management uses Adjusted EBITDA, defined as earnings before interest, taxes, depreciation and amortization and excludes pension benefit cost, restructuring and impairment charges, acquisition and integration expense and certain acquisition fair value and other miscellaneous adjustments, to evaluate the Company’s results. We believe this non-GAAP financial measure is useful to investors because it provides a more complete understanding of our current underlying operating performance, a clearer comparison of current period results with past reports of financial performance, and greater transparency regarding information used by management in its decision-making. Internally, management and our Board of Directors use this non-GAAP measure to evaluate our business performance. The Company’s debt covenants are also based on the Adjusted EBITDA calculation.

In addition, because our credit facility is borrowed under a revolving credit agreement, which currently permits us to borrow and repay at will up to a balance of $125 million (subject to limitations related to receivables, inventories, and letters of credit), we take the measure of cash flow performance prior to borrowing or repayment of the credit facility. In effect, we evaluate cash flow as the change in net debt (credit facility debt less cash equivalents).

The table below provides a reconciliation of these non-GAAP measures to their most comparable measure calculated in accordance with GAAP.

       
THE STANDARD REGISTER COMPANY
CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except per share amounts)
(Unaudited)
 

13 Weeks Ended

13 Weeks Ended
Mar 30, 2014    

Mar 31, 2013

 
TOTAL REVENUE $ 228,489 $ 141,620
 
COST OF SALES 166,023       99,700  
 

GROSS MARGIN

62,466 41,920
 
OPERATING EXPENSES
Selling, general and administrative 58,679 34,736
Acquisition and integration costs 2,697 1,107
Asset impairments 436
Restructuring and other exit costs 2,806       626  
 
TOTAL OPERATING EXPENSES 64,618       36,469  
 
(LOSS) INCOME FROM OPERATIONS (2,152 ) 5,451
 
OTHER INCOME (EXPENSE)
Interest expense (4,988 ) (624 )
Other income (expense) 163       (1 )
Total other expense (4,825 ) (625 )
 
(LOSS) INCOME BEFORE INCOME TAXES (6,977 ) 4,826
 
Income tax expense 151       127  
 
NET (LOSS) INCOME $ (7,128 )     $ 4,699  
 
Average Number of Shares Outstanding - Basic 8,590 5,872
Average Number of Shares Outstanding - Diluted 8,590 5,906
 
BASIC (LOSS) INCOME PER SHARE $ (0.83 ) $ 0.80

DILUTED (LOSS) INCOME PER SHARE

$ (0.83 ) $ 0.80
 

MEMO:

Depreciation and amortization

$

9,196

$ 5,066
 
       
SEGMENT OPERATING RESULTS
(In thousands)
(Unaudited)
13 Weeks Ended 13 Weeks Ended
Mar 30, 2014    

Mar 31, 2013

REVENUE
Healthcare $ 64,777 $ 49,495
Business Solutions 163,712       92,125  
Total Revenue $ 228,489       $ 141,620  
 

NET (LOSS) INCOME BEFORE TAXES

Healthcare $ 1,870 $ 2,136
Business Solutions 1,422 2,934
Unallocated (10,269 )     (244 )
Total Net (Loss) Income Before Taxes $ (6,977 )     $ 4,826  
 
       
CONSOLIDATED BALANCE SHEETS
(In thousands)

(Unaudited)

Mar 30, 2014     Dec 29, 2013
ASSETS
Cash and cash equivalents $ 3,081 $ 2,342
Accounts receivable 154,230 157,567
Inventories 61,306 61,939
Other current assets 15,561       14,508  
Total current assets 234,178 236,356
 
Plant and equipment 90,593 93,003
Goodwill and intangible assets 130,904 133,444
Deferred taxes 9,311 9,306
Other assets 8,504       8,768  
Total assets $ 473,490       $ 480,877  
 

LIABILITIES AND SHAREHOLDERS' DEFICIT

Current liabilities $ 127,960 $ 125,357
Deferred compensation 3,021 3,169
Long-term debt 268,055 263,880
Pension benefit liability 185,531 192,779
Other long-term liabilities 6,887 6,989
Shareholders' deficit (117,964 ) (111,297 )
           
Total liabilities and shareholders' deficit $ 473,490       $ 480,877  
 
       
CONSOLIDATED STATEMENT OF CASH FLOWS
(In thousands)
(Unaudited)
13 Weeks Ended 13 Weeks Ended
Mar 30, 2014     Mar 31, 2013
 
Net (loss) income plus non-cash items $ 5,772 $ 10,169
Working capital 4,619 3,471
Restructuring payments (3,828 ) (565 )
Contributions to qualified pension plan (5,932 ) (5,839 )
Other (1,742 )     (2,363 )
Net cash (used in) provided by operating activities (1,111 ) 4,873
 
Additions to plant and equipment (3,637 ) (3,889 )
Proceeds from sale of equipment 49       77  
Net cash used in investing activities (3,588 ) (3,812 )
 
Net change in borrowings under credit facility 6,761 (629 )
Principal payments on long-term debt (1,107 ) (592 )
Other (146 )      
Net cash provided by (used in) financing activities 5,508       (1,221 )
 
Effect of exchange rate (70 )     211  
 
Net change in cash $ 739       $ 51  
 
       
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
(In thousands)
(Unaudited)
13 Weeks Ended 13 Weeks Ended

Mar 30, 2014

    Mar 31, 2013
GAAP Net (Loss) Income $ (7,128 ) $ 4,699
Adjustments:
Income taxes 151 127
Interest 4,988 624
Depreciation and amortization 9,196       5,066  
EBITDA $ 7,207       $ 10,516  
 
Adjustments:
Restructuring and impairment 3,242 626
Acquisition and integration costs 2,697 1,107
Pension expense (548 ) (507 )
Non-cash stock compensation 681 469
Other (111 )      
Adjusted EBITDA $ 13,168       $ 12,211  
 
GAAP Net Cash Flow $ 739 $ 51
Adjustments:
Credit facility (borrowed) paid (6,761 )     629  
Non-GAAP Net Cash Flow $ (6,022 )     $ 680  

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
DevOps Summit, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long development...
Too often with compelling new technologies market participants become overly enamored with that attractiveness of the technology and neglect underlying business drivers. This tendency, what some call the “newest shiny object syndrome,” is understandable given that virtually all of us are heavily engaged in technology. But it is also mistaken. Without concrete business cases driving its deployment, IoT, like many other technologies before it, will fade into obscurity.
Whether you like it or not, DevOps is on track for a remarkable alliance with security. The SEC didn’t approve the merger. And your boss hasn’t heard anything about it. Yet, this unruly triumvirate will soon dominate and deliver DevSecOps faster, cheaper, better, and on an unprecedented scale. In his session at DevOps Summit, Frank Bunger, VP of Customer Success at ScriptRock, will discuss how this cathartic moment will propel the DevOps movement from such stuff as dreams are made on to a prac...
SYS-CON Events announced today that DataClear Inc. will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. The DataClear ‘BlackBox’ is the only solution that moves your PC, browsing and data out of the United States and away from prying (and spying) eyes. Its solution automatically builds you a clean, on-demand, virus free, new virtual cloud based PC outside of the United States, and wipes it clean...
With the proliferation of connected devices underpinning new Internet of Things systems, Brandon Schulz, Director of Luxoft IoT – Retail, will be looking at the transformation of the retail customer experience in brick and mortar stores in his session at @ThingsExpo. Questions he will address include: Will beacons drop to the wayside like QR codes, or be a proximity-based profit driver? How will the customer experience change in stores of all types when everything can be instrumented and a...
Contrary to mainstream media attention, the multiple possibilities of how consumer IoT will transform our everyday lives aren’t the only angle of this headline-gaining trend. There’s a huge opportunity for “industrial IoT” and “Smart Cities” to impact the world in the same capacity – especially during critical situations. For example, a community water dam that needs to release water can leverage embedded critical communications logic to alert the appropriate individuals, on the right device, as...
Manufacturing connected IoT versions of traditional products requires more than multiple deep technology skills. It also requires a shift in mindset, to realize that connected, sensor-enabled “things” act more like services than what we usually think of as products. In his session at @ThingsExpo, David Friedman, CEO and co-founder of Ayla Networks, will discuss how when sensors start generating detailed real-world data about products and how they’re being used, smart manufacturers can use the ...
WebRTC services have already permeated corporate communications in the form of videoconferencing solutions. However, WebRTC has the potential of going beyond and catalyzing a new class of services providing more than calls with capabilities such as mass-scale real-time media broadcasting, enriched and augmented video, person-to-machine and machine-to-machine communications. In his session at @ThingsExpo, Luis Lopez, CEO of Kurento, will introduce the technologies required for implementing thes...
Organizations from small to large are increasingly adopting cloud solutions to deliver essential business services at a much lower cost. According to cyber security experts, the frequency and severity of cyber-attacks are on the rise, causing alarm to businesses and customers across a variety of industries. To defend against exploits like these, a company must adopt a comprehensive security defense strategy that is designed for their business. In 2015, organizations such as United Airlines, Sony...
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Any Ops team trying to support a company in today’s cloud-connected world knows that a new way of thinking is required – one just as dramatic than the shift from Ops to DevOps. The diversity of modern operations requires teams to focus their impact on breadth vs. depth. In his session at DevOps Summit, Adam Serediuk, Director of Operations at xMatters, Inc., will discuss the strategic requirements of evolving from Ops to DevOps, and why modern Operations has begun leveraging the “NoOps” approa...
While many app developers are comfortable building apps for the smartphone, there is a whole new world out there. In his session at @ThingsExpo, Narayan Sainaney, Co-founder and CTO of Mojio, will discuss how the business case for connected car apps is growing and, with open platform companies having already done the heavy lifting, there really is no barrier to entry.
To assist customers with legacy Windows Server 2003 that is no longer supported by Microsoft, Racemi has introduced fixed price packages for upgrading and migrating Windows Server 2003 servers to either Windows 2008 R2 or Windows 2012 R2 and the choice of Amazon Web Services (AWS) or SoftLayer cloud. "We're extending a lifeline by upgrading the legacy servers to more modern Windows Server platforms while taking advantage of cloud computing," said James Strayer, vice president of product managem...
All major researchers estimate there will be tens of billions devices - computers, smartphones, tablets, and sensors - connected to the Internet by 2020. This number will continue to grow at a rapid pace for the next several decades. With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo, November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Learn what is going on, contribute to the discussions, and e...
As more intelligent IoT applications shift into gear, they’re merging into the ever-increasing traffic flow of the Internet. It won’t be long before we experience bottlenecks, as IoT traffic peaks during rush hours. Organizations that are unprepared will find themselves by the side of the road unable to cross back into the fast lane. As billions of new devices begin to communicate and exchange data – will your infrastructure be scalable enough to handle this new interconnected world?