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Educational Development Corp. Reports Operating Results (10-Q)

January 17, 2012 | About:
10qk

10qk

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Educational Development Corp. (EDUC) filed Quarterly Report for the period ended 2011-11-30.

Educational Development Corp. has a market cap of $20.06 million; its shares were traded at around $5.15 with a P/E ratio of 16.61 and P/S ratio of 0.74. The dividend yield of Educational Development Corp. stocks is 9.32%.

Highlight of Business Operations:

The UBAM Division s discounts and allowances were $1,361,500 and $1,255,500 for the quarterly periods ended November 30, 2011 and 2010, respectively. The UBAM Division is a multi-level selling organization that markets its products through independent sales representatives (“consultants”). Sales are made to individual purchasers and school and public libraries. Most sales in the UBAM Division are at retail. As a part of the UBAM Division s marketing programs, discounts between 40% and 50% of retail are offered on selected items at various times throughout the year. The discounts and allowances in the UBAM Division will vary from year to year depending upon the marketing programs in place during any given year. The UBAM Division s discounts and allowances were 20.9% and 16.9% of UBAM s gross sales for the quarterly periods ended November 30, 2011 and 2010, respectively.

The Publishing Division s discounts and allowances are a much larger percentage of gross sales than discounts and allowances in the UBAM Division due to the different customer markets that each division targets. The Publishing Division s discounts and allowances were $3,471,900 and $2,978,900 for the quarterly periods ended November 30, 2011 and 2010, respectively. The Publishing Division sells to retail book chains, regional and local bookstores, toy and gift stores, school supply stores and museums. To be competitive with other wholesale book distributors, the Publishing Division sells at discounts between 48% and 55% of the retail price, based upon the quantity of books ordered and the dollar amount of the order. The Publishing Division s discounts and allowances were 52.1% of Publishing s gross sales for the quarterly period ended November 30, 2011 and 51.4% for the quarterly period ended November 30, 2010.

The UBAM Division s gross sales decreased $995,900 during the nine month period ending November 30, 2011 when compared with the same year-to-date period a year ago. This decrease consists primarily of decreases of 22% in home parties, 17% in internet sales, 14% in direct sales and 13% in school and library sales.

The UBAM Division s discounts and allowances were $3,040,200 and $2,347,400 for the year-to-date periods ended November 30, 2011 and 2010, respectively. The UBAM Division is a multi-level selling organization that markets its products through independent sales representatives (“consultants”). Sales are made to individual purchasers and school and public libraries. Most sales in the UBAM Division are at retail. As a part of the UBAM Division s marketing programs, discounts between 40% and 50% of retail are offered on selected items at various times throughout the year. The discounts and allowances in the UBAM Division will vary from year to year depending upon the marketing programs in place during any given year. The UBAM Division s discounts and allowances were 21.3% and 15.4% of UBAM s gross sales for the year-to-date periods ended November 30, 2011 and 2010, respectively.

The Publishing Division s discounts and allowances are a much larger percentage of gross sales than discounts and allowances in the UBAM Division due to the different customer markets that each division targets. The Publishing Division s discounts and allowances were $9,190,900 and $8,248,200 for the year-to-date periods ended November 30, 2011 and 2010, respectively. The Publishing Division sells to retail book chains, regional and local bookstores, toy and gift stores, school supply stores and museums. To be competitive with other wholesale book distributors, the Publishing Division sells at discounts between 48% and 55% of the retail price, based upon the quantity of books ordered and the dollar amount of the order. The Publishing Division s discounts and allowances were 52.2% of Publishing s gross sales for the year-to-date period ended November 30, 2011 and 52.0% for the year-to-date period ended November 30, 2010.

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