Educational Development Corporation Announces Third Quarter Financial Results for Quarter Ended November 30, 2016
January 24 2017 - 5:50PM
Educational Development Corporation (“EDC”) (NASDAQ:EDUC)
(http://www.edcpub.com) today reported historic record net revenues
for the third quarter ended November 30, 2016 (unaudited).
EDC will host its first Quarterly Investor Call via
a live Q&A webcast on Friday, January 27, 2017, at 2 PM CT (3
PM ET). Phone lines for participants will be available at (844)
395-9253. The conference passcode is 49360015. The weblink to
the call is http://edge.media-server.com/m/p/ipvw53tp.
The link to the webcast, including replays will be
available following the event at www.edcpub.com/investors.aspx.
Randall White, CEO of Educational Development
Corporation, announced that the Company surpassed our previous net
revenues milestone with $30.7 million for the quarter ended
November 30, 2016, compared to $24.4 million for the same quarter
last year.
The sales increase was primarily generated by the
home business division, Usborne Books & More (UBAM) with an
increase of 27% over the same quarter last year. UBAM continues to
attract new sales associates, which now total just fewer than
28,000, compared to 17,200 at the end of November 2015.
The Company's net revenues of $79.4 million for
year-to-date Fiscal Year 2017, are a marked increase over
year-to-date Fiscal Year 2016 of $46.7 million. The Company
is on pace for net revenues of over $110 million for the fiscal
year ending February 28, 2017.
The sales growth continued as the Company posted
net revenue in December of $14.2 million, the largest monthly net
revenue in our history which compares to $7.8 million the previous
December.
As exciting as the inordinate demand for our
products has been, the explosive growth over the past two years
inevitably led to challenges, including issues with our shipping
and distribution process that gave rise to a significant order
backlog at the end of the quarter. This led to a reduction in
our service level to our Sales Consultants and their customers as
well as our retail distribution outlets.
Throughout the current fiscal year, the Company
installed multiple new software and distribution systems with
individual functionalities that integrate to create a customized,
state-of-the-art process. These systems include new warehouse
management software, an order fulfillment system, a new software
platform for UBAM, and a software package for financial and
accounting functions. While launching each of these systems
in a relatively close timeframe was necessary to accommodate our
growth, a number of complications ensued.
The integration of this combination of systems was
hampered by steep learning curves and complicated customizations.
This was particularly true of our new software platform for
UBAM, which management continues to work with the vendor to have
the system fully functional to meet the intended needs of our
direct-sales program. Additionally, reporting from these new
systems was more complicated than expected and resulted in a filing
extension being required.
The extraordinary growth resulted in the Company
increasing its inventory levels to $34.5 million on November 30,
2016, from $17.6 million on November 30, 2015. The current
payments owed to our suppliers contributed to our violation of a
covenant with our bank, requiring the reclassification of our
building loans to current maturities. We expect to receive a
waiver of this covenant by the end of January.
The Company is currently implementing efficiencies
to the entire warehouse-fulfillment operation based on evaluations
from world-renowned logistics and distribution companies and will
continue to do so throughout Fiscal Year 2018.
This information may contain forward looking
statements. Although the company believes any such statements
are based on reasonable assumptions, there is no assurance that
actual outcomes will not be materially different.
EDUCATIONAL DEVELOPMENT
CORPORATION |
CONDENSED STATEMENTS OF EARNINGS |
|
Three Months Ended November 30, |
Nine Months Ended November 30, |
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
|
|
|
|
NET
REVENUES |
$ |
30,697,600 |
|
$ |
24,424,200 |
|
$ |
79,374,800 |
|
$ |
46,668,800 |
EARNINGS
BEFORE INCOME TAXES |
|
2,040,100 |
|
|
2,033,100 |
|
|
3,565,400 |
|
|
3,603,800 |
INCOME
TAXES |
|
765,900 |
|
|
774,600 |
|
|
1,352,500 |
|
|
1,376,300 |
NET
EARNINGS |
$ |
1,274,200 |
|
$ |
1,258,500 |
|
$ |
2,212,900 |
|
$ |
2,227,500 |
|
|
|
|
|
|
|
|
|
|
|
|
BASIC AND
DILUTED EARNINGS |
|
|
|
|
PER SHARE: |
|
|
|
|
Basic |
$ |
0.31 |
|
$ |
0.31 |
|
$ |
0.54 |
|
$ |
0.55 |
Diluted |
$ |
0.31 |
|
$ |
0.31 |
|
$ |
0.54 |
|
$ |
0.55 |
|
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED
AVERAGE NUMBER OF |
|
|
|
|
COMMON AND EQUIVALENT SHARES |
|
|
|
|
OUTSTANDING: |
|
|
|
|
Basic |
|
4,079,916 |
|
|
4,055,756 |
|
|
4,074,355 |
|
|
4,044,622 |
Diluted |
|
4,084,863 |
|
|
4,060,293 |
|
|
4,079,833 |
|
|
4,046,192 |
|
|
|
|
|
|
|
|
|
|
|
|
About Educational Development
CorporationEDC is a publishing company specializing in
books for children. EDC is the sole American distributor of the
UK-based Usborne Books and owns Kane Miller Books, specializing in
children’s literature from around the world. EDC’s current catalog
contains over 1,800 titles, with new additions semi-annually. Both
Usborne and Kane Miller products are sold via 5,000 retail outlets
and by just under 26,000 direct sales consultants nationally.
Our fiscal years end February 28th.
Contact:
Educational Development Corporation
Randall White, (918) 622-4522
Educational Development (NASDAQ:EDUC)
Historical Stock Chart
From Mar 2024 to Apr 2024
Educational Development (NASDAQ:EDUC)
Historical Stock Chart
From Apr 2023 to Apr 2024