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

January 14, 2013 | About:
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10qk

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Educational Development Corp. (EDUC) filed Quarterly Report for the period ended 2012-11-30.

Educational Development Corporation has a market cap of $15.5 million; its shares were traded at around $3.99 with a P/E ratio of 10.3 and P/S ratio of 0.6. The dividend yield of Educational Development Corporation stocks is 11.9%.
This is the annual revenues and earnings per share of EDUC over the last 10 years. For detailed 10-year financial data and charts, go to 10-Year Financials of EDUC.


Highlight of Business Operations:

The UBAM Division s gross sales decreased $956,400 during the three-month period ending November 30, 2012 when compared with the same quarterly period a year ago. This decrease resulted from decreases of 19% in direct sales, 19% in home party sales, 17% in fundraiser sales, and 10% in internet sales, offset by an increase of 3% in school and library sales.

The UBAM Division s discounts and allowances were $935,400 and $1,361,500 for the quarterly periods ended November 30, 2012 and 2011, 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. Gross sales in the UBAM Division are based on the retail sales prices of the products. As a part of the UBAM Division s varied marketing programs, discounts relevant to the particular program are offered. The discounts and allowances in the UBAM Division will vary from year-to-year depending on the marketing programs in place during any given period. The UBAM Division s discounts and allowances were 16.8% and 20.9% of UBAM s gross sales for the quarterly periods ended November 30, 2012 and 2011, 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 $3,194,400 and $3,471,900 for the quarterly periods ended November 30, 2012 and 2011, 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 sales prices of the products, based upon the quantity of books ordered and the dollar amount of the order. The Publishing Division s discounts and allowances were 51.9% and 52.1% of Publishing s gross sales for the respective quarterly periods ended November 30, 2012 and November 30, 2011.

Cost of sales decreased 10.4% for the three months ended November 30, 2012 when compared with the three months ended November 30, 2011. Cost of sales as a percentage of gross sales were 26.1% and 25.9%, respectively, for each of the three month periods ended November 30, 2012 and November 30, 2011. Cost of sales is the inventory cost of the product sold, which includes the cost of the product itself and inbound freight charges. Purchasing and receiving costs, inspection costs, warehousing costs, and other costs of our distribution network are included in operating and selling expenses, not in cost of sales. These costs totaled $274,200 in the quarter ended November 30, 2012 and $258,200 in the quarter ended November 30, 2011.

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 $9,008,100 and $9,190,900 for the year-to-date periods ended November 30, 2012 and 2011, 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 sales prices of the products, based upon the quantity of books ordered and the dollar amount of the order. The Publishing Division s discounts and allowances were 51.8% of Publishing s gross sales for the year-to-date period ended November 30, 2012 and 52.2% for the year-to-date period ended November 30, 2011.

Read the The complete Report

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