Schawk, Inc.
Consolidated Statements of Operations
Three Months Ended September 30, 2006 and 2005
(Unaudited)
(In Thousands, Except Share Amounts)
2006 2005
--------- ---------
Net sales $ 134,779 $ 151,644
Cost of sales 86,430 98,270
Selling, general, and administrative expenses 32,546 36,419
Acquisition integration expenses -- 1,971
--------- ---------
Operating income 15,803 14,984
Other income (expense):
Interest income 84 103
Interest expense (2,720) (2,180)
Other income (expense) -- 12
--------- ---------
(2,636) (2,065)
--------- ---------
Income from continuing operations before income
taxes 13,167 12,919
Income tax provision 4,961 4,763
--------- ---------
Income from continuing operations 8,206 8,156
Income (loss) from discontinued operations, net of
tax (benefit) expense of ($1) in 2006 and $374
in 2005 (57) 604
--------- ---------
Net income $ 8,149 $ 8,760
========= =========
Earnings per share:
Basic:
Income from continuing operations $ 0.31 $ 0.31
Gain (loss) from discontinued operations -- 0.03
--------- ---------
Net income per common share $ 0.31 $ 0.34
========= =========
Diluted:
Income from continuing operations $ 0.30 $ 0.29
Gain (loss) from discontinued operations -- 0.03
--------- ---------
Net income per common share $ 0.30 $ 0.32
========= =========
Weighted average number of common and
common equivalent shares outstanding – diluted 27,496 27,705
Dividends per common share $ 0.0325 $ 0.0325
Schawk, Inc.
Consolidated Statements of Operations
Nine Months Ended September 30, 2006 and 2005
(Unaudited)
(In Thousands, Except Share Amounts)
2006 2005
--------- ---------
Net sales $ 408,628 $ 416,053
Cost of sales 264,807 270,161
Selling, general, and administrative expenses 101,527 101,094
Acquisition integration expenses 758 3,772
Other income (2,120) --
--------- ---------
Operating income 43,656 41,026
Other income (expense):
Interest income 280 254
Interest expense (8,039) (5,958)
Other income (expense) -- 498
--------- ---------
(7,759) (5,206)
--------- ---------
Income from continuing operations before income
taxes 35,897 35,820
Income tax provision 13,550 13,425
--------- ---------
Income from continuing operations 22,347 22,395
Loss from discontinued operations, net of tax
benefit of $241 in 2006 and $135 in 2005 (446) (219)
--------- ---------
Net income $ 21,901 $ 22,176
========= =========
Earnings per share:
Basic:
Income from continuing operations $ 0.85 $ 0.89
Loss from discontinued operations (0.02) (0.01)
--------- ---------
Net income per common share $ 0.83 $ 0.88
========= =========
Diluted:
Income from continuing operations $ 0.81 $ 0.84
Loss from discontinued operations (0.02) (0.01)
--------- ---------
Net income per common share $ 0.79 $ 0.83
========= =========
Weighted average number of common and
common equivalent shares outstanding – diluted 27,682 26,761
Dividends per common share $ 0.0975 $ 0.0975
Schawk, Inc.
Consolidated Balance Sheets
(In Thousands, Except Share Amounts)
September 30,
2006 December 31,
(Unaudited) 2005
------------- -------------
Assets
Current assets:
Cash and cash equivalents $ 7,284 $ 7,519
Trade accounts receivable, less allowance
for doubtful accounts of $5,166 at
September 30, 2006 and $5,940 at
December 31, 2005 125,200 117,723
Inventories 28,202 24,868
Prepaid expenses and other 11,163 9,701
Deferred income taxes 15,452 9,845
Assets of discontinued operations -- 29,253
------------- -------------
Total current assets 187,301 198,909
Property and equipment, less accumulated
depreciation of $86,643 at September 30,
2006 and $74,506 at December 31, 2005 75,487 77,291
Goodwill 247,671 233,838
Intangible assets, net 35,263 42,223
Other assets 5,325 6,557
------------- -------------
Total assets $ 551,047 $ 558,818
============= =============
Liabilities and Stockholders' Equity
Current liabilities:
Trade accounts payable 20,238 $ 27,776
Accrued expenses 52,398 61,967
Income taxes payable 22,756 6,367
Current portion of long-term debt and
capital lease obligations 58 454
Liabilities of discontinued operations -- 8,208
------------- -------------
Total current liabilities 95,450 104,772
Long-term debt 151,414 169,528
Capital lease obligations 39 51
Other liabilities 19,939 27,383
Deferred income taxes 25,563 25,688
Stockholders' equity:
Common stock, $0.008 par value, 40,000,000
shares authorized, 28,905,094 and
28,441,689 shares issued at September 30,
2006 and December 31, 2005, respectively;
26,470,854 and 26,070,747 shares
outstanding at September 30, 2006 and
December 31, 2005, respectively 229 225
Additional paid-in capital 176,716 168,777
Retained earnings 107,739 88,424
Accumulated comprehensive income 3,124 1,933
------------- -------------
287,808 259,359
Treasury stock, at cost, 2,434,240 and
2,370,942 shares of common stock at
September 30, 2006 and December 31,
2005, respectively (29,166) (27,963)
------------- -------------
Total stockholders' equity 258,642 231,396
------------- -------------
Total liabilities and stockholders' equity $ 551,047 $ 558,818
============= =============
Schawk, Inc.
Regulation G: Reconciliation of Non-GAAP measures to GAAP
Three Months Ended September 30, 2006 and 2005
(In thousands, Except Share Amounts)
Three Months Three Months
Ended Ended
September September
30, 2006 30, 2005
---------- ---------
Operating income per GAAP $ 15,803 $ 14,984
==========
Acquisition integration expenses 1,971
---------
Operating income before acquisition integration
expenses (Non-GAAP) $ 16,955
=========
Income from continuing operations before income
taxes per GAAP $ 13,167 $ 12,919
==========
Plus: Acquisition integration expenses (Non-GAAP) 1,971
---------
Income from continuing operations before income
taxes and integration expenses (Non-GAAP) 14,890
Income tax provision on Non-GAAP pretax income 5,494
---------
Income from continuing operations before
acquisition integration expenses (Non-GAAP) $ 9,396
=========
Weighted average number of common and common stock
equivalent shares outstanding (GAAP) 27,496 27,705
Earnings per share fully diluted from continuing
operations before acquisition integration expenses
(Non-GAAP) $ 0.33
Less: acquisition integration expenses after tax
per share fully diluted (Non-GAAP) (0.04)
---------
Earnings per share fully diluted from continuing
operations per GAAP $ 0.30 $ 0.29
Income from discontinued operations, net of a tax
benefit per fully diluted share per GAAP -- 0.03
---------- ---------
Earnings per share fully diluted per GAAP $ 0.30 $ 0.32
========== =========
Schawk, Inc.
Regulation G: Reconciliation of Non-GAAP measures to GAAP
Nine Months Ended September 30, 2006 and 2005
(In thousands, Except Share Amounts)
Nine Months Nine Months
Ended Ended
September September
30, 2006 30, 2005
========= =========
Operating income per GAAP $ 43,656 $ 41,026
Acquisition integration expenses 758 3,772
Other income - reserve reversal from lawsuit
settlement (2,120) --
--------- ---------
Operating income before acquisition integration
expenses and lawsuit settlement (Non-GAAP) $ 42,294 $ 44,798
========= =========
Income from continuing operations before income
taxes per GAAP $ 35,987 $ 35,820
Plus: Acquisition integration expenses (Non-GAAP) 758 3,772
Less: Other income – reserve reversal from lawsuit
settlement (Non-GAAP) (2,120) --
Less: Other income (expense) – non-recurring
proceeds from life insurance other
income (Non-GAAP) -- (486)
--------- ---------
Income from continuing operations before income
taxes, acquisition integration expenses, lawsuit
settlement and other non-recurring income
(Non-GAAP) 34,625 39,106
Income tax provision on Non-GAAP pretax income 13,054 14,665
--------- ---------
Income from continuing operations before acquistion
integration expenses, lawsuit settlement and other
non-recurring income (Non-GAAP) $ 21,571 $ 24,441
========= =========
Weighted average number of common and common stock
equivalent shares outstanding (GAAP) 27,682 26,761
Earnings per share fully diluted from continuing
operations before acquisition integration
expenses, lawsuit settlement and other
non-recurring income (Non-GAAP) $ 0.78 $ 0.92
Less: acquisition integration expenses after tax
per share fully diluted (Non-GAAP) (0.02) (0.09)
Plus: Lawsuit settlement and other non-recurring
income after tax per share fully diluted (Non-GAAP) 0.05 0.01
--------- ---------
Earnings per share fully diluted from continuing
operations per GAAP $ 0.81 $ 0.84
Loss from discontinued operations, net of a tax
benefit per fully diluted share per GAAP (0.02) (0.01)
--------- ---------
Earnings per share fully diluted per GAAP $ 0.79 $ 0.83
========= =========
Contact Information: AT SCHAWK, INC.: James J. Patterson Sr. VP and CFO jpatterson@schawk.com AT DRESNER CORPORATE SERVICES: Investors: Philip Kranz 312-780-7240 pkranz@dresnerco.com Media: Steve Carr 312-780-7211 scarr@dresnerco.com