Consolidated Graphics Inc. (CGX, Financial) filed Quarterly Report for the period ended 2010-09-30.
Consolidated Graphics Inc. has a market cap of $553.6 million; its shares were traded at around $47.79 with a P/E ratio of 20.4 and P/S ratio of 0.6. Consolidated Graphics Inc. had an annual average earning growth of 4% over the past 10 years.CGX is in the portfolios of Jim Simons of Renaissance Technologies LLC.
General and administrative expenses during the three months ended September 30, 2010 increased $1.3 million, or 6%, to $23.7 million, from $22.4 million for the same period in the prior year. This increase primarily resulted from increased staff within our information technology group and new software licenses. As a percentage of sales, general and administrative expenses increased to 9.1% in the current quarter compared to 8.9% for the same period in the prior year.
Gross profit during the six months ended September 30, 2010 increased $16.3 million, or 16%, to $116.6 million compared to $100.3 million for the same period in the prior year. The increase in gross profit was due to the 4% increase in sales and an increase in the gross profit margin. Gross profit margin (gross profit divided by revenues) increased to 23.5% during the six months ended September 30, 2010 from 21.0% for the same period in the prior year as a result of lower labor costs, higher scrap paper recycling income, and fixed costs, such as depreciation, decreasing or not increasing as much as sales.
Selling expense during the six months ended September 30, 2010 declined $0.8 million, or 2%, to $45.6 million from $46.4 million for the same period in the prior year. The decrease was primarily due to lower sales commissions and other miscellaneous selling expenses. As a percentage of sales, selling expenses decreased slightly to 9.2% in the current period as compared to 9.7% for the same period in the prior year.
General and administrative expenses during the six months ended September 30, 2010 increased $2.6 million, or 6%, to $46.2 million from $43.6 million for the same period in the prior year. This increase primarily resulted from increased investments in staff within our information technology group, new software licenses and higher bad debt expense. As a percentage of sales, general and administrative expenses increased to 9.3% in the current period compared to 9.1% for the same period in the prior year.
Under the terms of the Credit Agreement the proceeds from borrowings may be used to repay certain indebtedness, finance certain acquisitions, provide for working capital and general corporate purposes and, subject to certain restrictions, repurchase our common stock. In order to repurchase our common stock under the terms of the Credit Agreement, we must (1) demonstrate compliance on a proforma basis, giving effect to such repurchase with the financial covenants set forth in the Credit Agreement, and (2) have a Leverage Ratio (Debt divided by EBITDA, as defined in the Credit Agreement) not exceeding 2.50 to 1.00 on a proforma basis after giving effect to the repurchase. Borrowings outstanding under the Credit Agreement are secured by substantially all of our assets other than real estate and certain equipment subject to term equipment notes and other financings. The collateral also secures, on a pari passu basis, the obligations under the A&B Credit Facility and the Auxiliary Bank Facilities described below. Borrowings under the Credit Agreement accrue interest, at our option, at either LIBOR plus a margin of 1.375% to 2.75%, or an alternate base rate (based upon the greater of (i) the administrative agent banks prime lending rate, (ii) the sum of the LIBOR rate for a one-month interest period plus 1.50% or (iii) the sum of the Federal Funds effective rate plus 0.5% per annum) plus a margin of 0.0% to 1.25%. We are also required to pay an annual commitment fee ranging from 0.25% to 0.5% on available but unused amounts under the Credit Agreement. The interest rate margin and the commitment fee are based upon certain financial performance measures set forth in the Credit Agreement and are redetermined quarterly. At September 30, 2010, the applicable margin on LIBOR based loans is 1.625%, the applicable margin on alternative base rate loans is 0.125% and the applicable commitment fee was 0.25%.
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Consolidated Graphics Inc. has a market cap of $553.6 million; its shares were traded at around $47.79 with a P/E ratio of 20.4 and P/S ratio of 0.6. Consolidated Graphics Inc. had an annual average earning growth of 4% over the past 10 years.CGX is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
Gross profit during the three months ended September 30, 2010 increased $6.7 million, or 12%, to $62.1 million, compared to $55.4 million for the same period in the prior year. The increase in gross profit was due to the 3% increase in sales and an increase in the gross profit margin. Gross profit margin (gross profit divided by revenues) increased from 22.0% in the September 2009 quarter to 23.9% in the September 2010 quarter primarily as a result of lower labor costs, higher scrap paper recycling income and fixed costs, such as depreciation, decreasing or not increasing as much as sales.General and administrative expenses during the three months ended September 30, 2010 increased $1.3 million, or 6%, to $23.7 million, from $22.4 million for the same period in the prior year. This increase primarily resulted from increased staff within our information technology group and new software licenses. As a percentage of sales, general and administrative expenses increased to 9.1% in the current quarter compared to 8.9% for the same period in the prior year.
Gross profit during the six months ended September 30, 2010 increased $16.3 million, or 16%, to $116.6 million compared to $100.3 million for the same period in the prior year. The increase in gross profit was due to the 4% increase in sales and an increase in the gross profit margin. Gross profit margin (gross profit divided by revenues) increased to 23.5% during the six months ended September 30, 2010 from 21.0% for the same period in the prior year as a result of lower labor costs, higher scrap paper recycling income, and fixed costs, such as depreciation, decreasing or not increasing as much as sales.
Selling expense during the six months ended September 30, 2010 declined $0.8 million, or 2%, to $45.6 million from $46.4 million for the same period in the prior year. The decrease was primarily due to lower sales commissions and other miscellaneous selling expenses. As a percentage of sales, selling expenses decreased slightly to 9.2% in the current period as compared to 9.7% for the same period in the prior year.
General and administrative expenses during the six months ended September 30, 2010 increased $2.6 million, or 6%, to $46.2 million from $43.6 million for the same period in the prior year. This increase primarily resulted from increased investments in staff within our information technology group, new software licenses and higher bad debt expense. As a percentage of sales, general and administrative expenses increased to 9.3% in the current period compared to 9.1% for the same period in the prior year.
Under the terms of the Credit Agreement the proceeds from borrowings may be used to repay certain indebtedness, finance certain acquisitions, provide for working capital and general corporate purposes and, subject to certain restrictions, repurchase our common stock. In order to repurchase our common stock under the terms of the Credit Agreement, we must (1) demonstrate compliance on a proforma basis, giving effect to such repurchase with the financial covenants set forth in the Credit Agreement, and (2) have a Leverage Ratio (Debt divided by EBITDA, as defined in the Credit Agreement) not exceeding 2.50 to 1.00 on a proforma basis after giving effect to the repurchase. Borrowings outstanding under the Credit Agreement are secured by substantially all of our assets other than real estate and certain equipment subject to term equipment notes and other financings. The collateral also secures, on a pari passu basis, the obligations under the A&B Credit Facility and the Auxiliary Bank Facilities described below. Borrowings under the Credit Agreement accrue interest, at our option, at either LIBOR plus a margin of 1.375% to 2.75%, or an alternate base rate (based upon the greater of (i) the administrative agent banks prime lending rate, (ii) the sum of the LIBOR rate for a one-month interest period plus 1.50% or (iii) the sum of the Federal Funds effective rate plus 0.5% per annum) plus a margin of 0.0% to 1.25%. We are also required to pay an annual commitment fee ranging from 0.25% to 0.5% on available but unused amounts under the Credit Agreement. The interest rate margin and the commitment fee are based upon certain financial performance measures set forth in the Credit Agreement and are redetermined quarterly. At September 30, 2010, the applicable margin on LIBOR based loans is 1.625%, the applicable margin on alternative base rate loans is 0.125% and the applicable commitment fee was 0.25%.
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