Schawk, Inc.
Consolidated Statements of Operations
Three Months Ended December 31, 2006 and 2005
(Unaudited)
(In Thousands, Except Share Amounts)
2006 2005
--------- ---------
Net sales $ 139,778 $ 146,051
Cost of sales 90,568 97,294
Selling, general, and administrative expenses 34,201 31,465
Acquisition integration and restructuring expenses 3,175 3,126
Reserve reversal from litigation settlement (3,000) --
--------- ---------
Operating income 14,834 14,166
Other income (expense):
Interest income 187 105
Interest expense (2,677) (2,641)
Other income (expense) -- --
--------- ---------
(2,490) (2,536)
--------- ---------
Income from continuing operations before income taxes 12,344 11,630
Income tax provision 5,168 4,338
--------- ---------
Income from continuing operations 7,176 7,292
Income (loss) from discontinued operations, net of
tax (benefit) expense of ($479) in 2006 and $621
in 2005 (689) 1,004
--------- ---------
Net Income $ 6,487 $ 8,296
========= =========
Earnings per share:
Basic:
Income from continuing operations $ 0.27 $ 0.28
Income (loss) from discontinued operations (0.03) 0.04
--------- ---------
Net income per common share $ 0.24 $ 0.32
========= =========
Diluted:
Income from continuing operations $ 0.26 $ 0.27
Income (loss) from discontinued operations (0.02) 0.03
--------- ---------
Net income per common share $ 0.24 $ 0.30
========= =========
Weighted average number of common and common
equivalent shares outstanding - diluted 27,421 27,425
Dividends per common share $ 0.0325 $ 0.0325
Schawk, Inc.
Consolidated Statements of Operations
Year Ended December 31, 2006 and 2005
(Unaudited)
(In Thousands, Except Share Amounts)
2006 2005
--------- ---------
Net sales $ 548,406 $ 562,104
Cost of sales 355,375 367,455
Selling, general, and administrative expenses 135,728 132,559
Acquisition integration and restructuring expenses 3,933 6,898
Reserve reversal from litigation settlement (5,120) --
--------- ---------
Operating income 58,490 55,192
Other income (expense):
Interest income 467 359
Interest expense (10,716) (8,599)
Other income (expense) -- 498
--------- ---------
(10,249) (7,742)
--------- ---------
Income from continuing operations before income taxes 48,241 47,450
Income tax provision 18,718 17,763
--------- ---------
Income from continuing operations 29,523 29,687
Income (loss) from discontinued operations, net of
tax (benefit) expense of ($720) in 2006 and $486
in 2005 (1,135) 785
--------- ---------
Net Income $ 28,388 $ 30,472
========= =========
Earnings per share:
Basic:
Income from continuing operations $ 1.12 $ 1.16
Income (loss) from discontinued operations (0.04) 0.03
--------- ---------
Net income per common share $ 1.08 $ 1.19
========= =========
Diluted:
Income from continuing operations $ 1.08 $ 1.10
Income (loss) from discontinued operations (0.04) 0.03
--------- ---------
Net income per common share $ 1.04 $ 1.13
========= =========
Weighted average number of common and common
equivalent shares outstanding - diluted 27,395 26,963
Dividends per common share $ 0.13 $ 0.13
Schawk, Inc.
Consolidated Balance Sheets
(In Thousands, Except Share Amounts)
December 31,
2006 December 31,
(Unaudited) 2005
------------ ------------
Assets
Current assets:
Cash and cash equivalents $ 10,177 $ 7,519
Trade accounts receivable, less allowance
for doubtful accounts of $4,621 at
December 31, 2006 and $5,940 at December
31, 2005 127,627 117,723
Inventories 23,575 24,868
Prepaid expenses and other 10,171 9,701
Deferred income taxes 8,580 9,845
Assets of discontinued operations -- 29,253
------------ ------------
Total current assets 180,130 198,909
Property and equipment, less accumulated
depreciation of $82,256 at December 31, 2006
and $74,506 at December 31, 2005 82,227 77,291
Goodwill 237,209 233,838
Intangible assets, net 35,755 42,223
Other assets 4,633 6,557
------------ ------------
Total assets $ 539,954 $ 558,818
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Trade accounts payable $ 26,522 $ 27,776
Accrued expenses 52,689 61,967
Income taxes payable 3,635 6,367
Current portion of long-term debt and capital
lease obligations 2,177 454
Liabilities of discontinued operations -- 8,208
------------ ------------
Total current liabilities 85,023 104,772
Long-term debt 140,748 169,528
Capital lease obligations 15 51
Other liabilities 22,260 27,383
Deferred income taxes 22,508 25,688
Stockholders' equity:
Common stock, $0.008 par value, 40,000,000
shares authorized, 28,989,013 and
28,441,689 shares issued at December 31,
2006 and December 31, 2005, respectively;
26,555,119 and 26,070,747 shares
outstanding at December 31, 2006 and
December 31, 2005, respectively 229 225
Additional paid-in capital 178,041 168,777
Retained earnings 113,365 88,424
Accumulated comprehensive income 6,925 1,933
------------ ------------
298,560 259,359
Treasury stock, at cost, 2,433,894 and
2,370,942 shares of common stock at
December 31, 2006 and December 31, 2005,
respectively (29,160) (27,963)
------------ ------------
Total stockholders' equity 269,400 231,396
------------ ------------
Total liabilities and stockholders' equity $ 539,954 $ 558,818
============ ============
Schawk, Inc.
Regulation G: Reconciliation of Non-GAAP measures to GAAP
Three Months Ended December 31, 2006 and 2005
(In thousands, Except Share Amounts)
2006 2005
--------- ---------
Operating income per GAAP $ 14,834 $ 14,166
Plus: Acquisition integration and restructuring
expenses (Non-GAAP) 3,175 3,126
Less: Reserve reversal from lawsuit settlement
(Non-GAAP) (3,000) --
--------- ---------
Operating income before acquisition integration
and restructuring expenses and reserve reversal
from lawsuit settlement (Non-GAAP) $ 15,009 $ 17,292
========= =========
Income from continuing operations before income
taxes per GAAP $ 12,344 $ 11,630
Plus: Acquisition integration and restructuring
expenses (Non-GAAP) 3,175 3,126
Less: Reserve reversal from lawsuit settlement
(Non-GAAP) (3,000) --
--------- ---------
Income from continuing operations before income
taxes and integration and restructuring expenses
and reserve reversal from litigation settlement
(Non-GAAP) 12,519 14,756
Income tax provision on Non-GAAP pretax income 5,245 5,504
--------- ---------
Income from continuing operations before
acquisition integration and restructuring
expenses and reserve reversal from litigation
settlement (Non-GAAP) $ 7,274 $ 9,252
========= =========
Weighted average number of common and common
stock equivalent shares outstanding (GAAP) 27,421 27,425
========= =========
Earnings per fully diluted share from continuing
operations before acquisition integration and
restructuring expenses and reserve reversal from
litigation settlement (Non-GAAP) $ 0.27 $ 0.34
Less: Acquisition integration and restructuring
expenses after tax per fully diluted share
(Non-GAAP) (0.07) (1) (0.07)
Plus: Reserve reversal from lawsuit settlement
after tax per fully diluted share (Non-GAAP) 0.06 --
--------- ---------
Earnings per fully diluted share from continuing
operations per GAAP $ 0.26 (1) $ 0.27
(Loss) income from discontinued operations, net
of a tax benefit per fully diluted share per
GAAP (0.03) 0.04
--------- ---------
Earnings per fully diluted share per GAAP $ 0.23 $ 0.30
========= =========
(1) Earnings per fully diluted share excluding acquisition integration and
restructuring expenses equals $0.33 in 2006 and $0.34 in 2005 and is
calculated by combining earnings per share fully diluted from
continuing operations per GAAP ($0.26 in 2006 and $0.27 in 2005) and
acquisition integration and restructuring expenses after tax per fully
diluted share Non-GAAP ($ 0.07 in 2006 and 2005).
Schawk, Inc.
Regulation G: Reconciliation of Non-GAAP measures to GAAP
Twelve Months Ended December 31, 2006 and 2005
(In thousands, Except Share Amounts)
2006 2005
========= =========
Operating income per GAAP $ 58,490 $ 55,192
Plus: Acquisition integration and restructuring
expenses (Non-GAAP) 3,933 6,898
Less: Reserve reversal from lawsuit settlements
(Non-GAAP) (5,120) --
--------- ---------
Operating income before acquisition integration
and restructuring expenses and lawsuit
settlement (Non-GAAP) $ 57,303 $ 62,090
========= =========
Income from continuing operations before income
taxes per GAAP $ 48,241 $ 47,450
Plus: Acquisition integration and restructuring
expenses (Non-GAAP) 3,933 6,898
Less: Reserve reversal from lawsuit settlements
(Non-GAAP) (5,120) --
Less: Other income - non-recurring proceeds from
life insurance other income (Non-GAAP) -- (486)
--------- ---------
Income from continuing operations before
acquisition integration and restructuring
expenses, lawsuit settlements and other
non-recurring income (Non-GAAP) 47,054 53,862
Income tax provision on Non-GAAP pretax income 18,257 20,144
--------- ---------
Income from continuing operations before
acquisition integration and restructuring
expenses, lawsuit settlements and other
non-recurring income (Non-GAAP) $ 28,797 $ 33,718
========= =========
Weighted average number of common and common
stock equivalent shares outstanding (GAAP) 27,395 26,963
========= =========
Earnings per share fully diluted from continuing
operations before acquisition integration and
restructuring expenses, lawsuit settlement and
other non-recurring income (Non-GAAP) $ 1.05 $ 1.25
Less: Acquisition integration and restructuring
expenses after tax per fully diluted share
(Non-GAAP) (0.09) (1) (0.16)
Plus: Lawsuit settlements and other
non-recurring income after tax per fully
diluted share (Non-GAAP) 0.12 0.01
--------- ---------
Earnings per fully diluted share from continuing
operations per GAAP $ 1.08 (1) $ 1.10
(Loss) income from discontinued operations, net
of a tax benefit per fully diluted share per
GAAP (0.04) 0.03
--------- ---------
Earnings per fully diluted share per GAAP $ 1.04 $ 1.13
========= =========
(1) Earnings per fully diluted share excluding acquisition integration and
restructuring expenses equals $1.17 in 2006 and $1.26 in 2005 and is
calculated by combining earnings per fully diluted share from
continuing operations per GAAP ($1.08 in 2006 and $1.10 in 2005) and
acquisition integration and restructuring expenses after tax per fully
diluted share (Non-GAAP) ($0.09 in 2006 and $0.16 in 2005).
Contact Information: AT SCHAWK, INC.: James J. Patterson Sr. VP and CFO 847-827-9494 jpatterson@schawk.com AT DRESNER CORPORATE SERVICES: Philip Kranz 312-780-7240 pkranz@dresnerco.com