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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
--------------------------
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended February 28, 2002
-----------------
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________ to _______
Commission file number 1-5807
-------------
ENNIS BUSINESS FORMS, INC.
- ----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Texas 75-0256410
- ----------------------- --------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1510 N. Hampton, Suite 300, DeSoto, TX 75115
- ---------------------------------------- ------------------
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code (972)228-7801
---------------
Securities registered pursuant to Section 12(b) of the Act:
Number of Shares
Outstanding on Name of each exchange
Title of each class April 15, 2002 on which registered
- ------------------- ---------------- -----------------------
Common Stock, par value
$2.50 per share 16,272,938 New York Stock Exchange
- ----------------------- ---------- -----------------------
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
---- ----
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]
The aggregate market value of voting stock held by non-affiliates
of the registrant as of April 15, 2002 (15,418,327 shares) was
$198,742,235.
Documents Incorporated by Reference:
Portions of 2002 Annual Report to Shareholders - Incorporated in
Parts I & II
Portions of Proxy Statement dated May 17, 2002 - Incorporated in
Part III
1
SECURITIES AND EXCHANGE COMMISSION
FORM 10-K
PART I
------
Item 1. Business.
- ------- ---------
Ennis Business Forms, Inc. was organized under the laws of
Texas in 1909. Ennis Business Forms, Inc. and its subsidiaries
(collectively "Ennis" or the "Company") operate in three business
segments. The Forms Solutions Group is primarily in the business
of manufacturing and selling business forms and other printed
business products. The Promotional Solutions Group is primarily
in the business of design, production and distribution of printed
and electronic media, presentation products, flexographic printing,
advertising specialties and Post-it (registered trademark)
Notes. The Financial Solutions Group designs, manufactures
and markets printed forms and specializes in internal bank forms,
secure and negotiable documents and custom products. Additional
information concerning the segments is incorporated herein by
reference to page 34 of the Company's 2002 Annual Report to
Shareholders which is attached as Exhibit (13) hereto.
Approximately 96% of the business products manufactured by
Ennis are custom and semi-custom, constructed in a wide variety
of sizes, colors, number of parts and quantities on an individual
job basis depending upon the customers' specifications. Ennis
operates twenty-nine manufacturing locations in twelve
strategically located states providing the Ennis dealer a
national network for meeting users' demands for hand or machine
written records and documents. For the year ended February 28,
2002 the sale of business products represents approximately 83%
of consolidated net sales.
While it is not possible, because of the lack of adequate
statistical information, to determine Ennis' share of the total
business products market, management believes Ennis is one of the
largest producers of business forms in the United States
distributing primarily through independent dealers, and that its
business forms offering is more diversified than that of most
companies in the business forms industry.
The industry is divided into two major competitive segments.
One segment sells directly to end users, and is dominated by a
few large manufacturers. The other segment, which the Company
primarily serves, distributes forms and other business products
through a variety of resellers. The Company believes it is the
largest forms company which serves this segment of the market.
There are a number of competitors which operate in this segment
ranging in size from single employee-owner operations to multi-
plant organizations. The Company's strategic plant locations and
buying power permit it to compete on a favorable basis within
this segment of the market on the competitive factors of service,
quality and price.
Distribution of business forms and other business products
throughout the United States is primarily through independent
dealers, including business forms distributors, stationers,
printers, computer software developers, advertising agencies,
etc. The Promotional and Financial Solutions Groups are
dependent upon certain major customers. The loss of such
customers could have a material adverse effect on the segment.
No single customer accounts for as much as ten percent of
consolidated net sales.
2
Raw materials principally consist of a wide variety of
weights, widths, colors, sizes and qualities of paper for
business products purchased from a number of major suppliers at
prevailing market prices.
Business products usage is generally not seasonal. General
economic conditions are the predominant factor in quarterly
volume fluctuations.
Patents, Trademarks, Licenses, Franchises and Concessions:
- ----------------------------------------------------------
The Company does not have any significant patents,
trademarks, licenses, franchises or concessions.
Backlog:
- --------
At February 28, 2002 the Company's backlog of business forms
orders believed to be firm was approximately $4,609,000 as
compared to approximately $4,952,000 at February 28, 2001. The
backlog of orders for tools, dies and special machinery at
February 28, 2002 was approximately $829,000 as compared to
approximately $1,896,232 at February 28, 2001. The backlog of
orders of promotional media at February 28, 2002 was
approximately $8,001,000 as compared to approximately $9,257,065
at February 28, 2001. The backlog of financial forms at February
28, 2002 was approximately $2,600,000 as compared to
approximately $2,500,000 at February 28, 2001. Approximately
$1,800,000 of the promotional media backlog is not expected to be
filled in the fiscal year ending February 28, 2003.
Research and Development:
- -------------------------
While the Company continuously looks for new products to sell
through its distribution channel, there have been no material
amounts spent on research and development in the fiscal year
ended February 28, 2002.
Environment:
- ------------
There have been no material effects on the Company arising
from compliance with Federal, State or local provisions or
regulations relating to the protection of the environment.
Employees:
- ----------
At February 28, 2002, the Company had approximately 2,144
employees, of whom approximately 551 were represented by three
unions and under five separate contracts expiring at various
times.
3
Item 2. Properties.
- ------- -----------
The Company operates twenty-nine manufacturing facilities
located in twelve states as follows:
Approximate Square feet of
floor space
Location Owned Leased Total
-------- ------ ------ -----
Forms Solutions Group
---------------------
Ennis, Texas Three
Manufacturing
Facilities 325,118 - 325,118
Chatham,
Virginia Manufacturing 127,956 - 127,956
Paso Robles,
California Manufacturing 94,120 - 94,120
Knoxville,
Tennessee Manufacturing 48,057 - 48,057
Portland,
Oregon Manufacturing - 47,000 47,000
Fort Scott,
Kansas Manufacturing 86,660 - 86,660
DeWitt, Iowa Two
Manufacturing
Facilities 95,000 - 95,000
Dallas, Texas Manufacturing 82,400 - 82,400
Moultrie,
Georgia Manufacturing 25,000 - 25,000
Coshocton, Ohio Manufacturing 24,750 - 24,750
Houston, Texas Manufacturing - 40,800 40,800
San Antonio,
Texas Manufacturing 47,426 - 47,426
------- ------- ---------
956,487 87,800 1,044,287
======= ======= =========
Promotional Solutions Group
---------------------------
Wolfe City, Two
Texas Manufacturing
Facilities 119,259 - 119,259
Macomb,
Michigan Manufacturing 56,350 - 56,350
Bell,
California Manufacturing - 19,286 19,286
Denver, Four
Colorado Manufacturing
Facilities and
Warehouse - 186,528 186,528
Dallas, Texas Manufacturing - 23,976 23,976
------- ------- -------
175,609 229,790 405,399
======= ======= =======
Financial Solutions Group
-------------------------
Brooklyn Park,
Minnesota Manufacturing 94,800 - 94,800
Roseville,
Minnesota Manufacturing - 42,500 42,500
Arden Hills,
Minnesota Warehouse - 23,684 23,684
Nevada, Iowa Manufacturing 48,500 - 48,500
Bridgewater,
Virginia Manufacturing - 27,000 27,000
Golden,
Colorado Manufacturing - 23,000 23,000
------- ------- -------
143,300 116,184 259,484
======= ======= =======
Administrative Offices
----------------------
DeSoto, Texas Executive and
Administrative
Offices - 13,577 13,577
Ennis, Texas Administrative
Offices 9,300 - 9,300
------- ------- --------
9,300 13,577 22,877
======= ======= ========
4
All of the Forms Solutions Group properties are used for the
production, warehousing and shipping of business forms and other
business products except the Dallas, Texas plant, which is used for
the production of tools, dies and special machinery. The
Promotional Solutions Group properties are used for the production,
warehousing and shipping of the following: business forms,
flexographic printing, advertising specialties and Post-it(registered
trademark) Notes (Wolfe City, Texas); presentation products (Macomb,
Michigan and Bell, California); and printed and electronic promotional
media (Denver, Colorado). All of the Financial
Solutions Group properties are used for the production of
warehousing and shipping of financial forms.
The plants are being operated at normal productive capacity.
Productive capacity fluctuates with the ebb and flow of market
demands and depends upon the product mix at a given point in
time. Equipment is added as existing machinery becomes obsolete
or unrepairable and as new equipment becomes necessary to meet
market demands; however, at any given time these additions and
replacements are not considered to be material additions to
property, plant and equipment, although such additions or
replacements may increase a plant's efficiency or capacity.
All of the foregoing facilities are considered to be in good
condition. The Company does not anticipate that substantial
expansion, refurbishing or re-equipping will be required in the
near future.
All of the rented property is held under leases with original
terms of two or more years, expiring at various times from April
2002 through August 2007. No difficulties are presently foreseen
in maintaining or renewing such leases as they expire.
Item 3. Legal Proceedings.
- ------- ------------------
There are no material pending legal proceedings other than
ordinary routine litigation incidental to the business to which
the registrant or its subsidiaries are parties or of which
property of the registrant or its subsidiaries is the subject.
Item 4. Submission of Matters to a Vote of Security Holders.
- ------- ----------------------------------------------------
None.
EXECUTIVE OFFICERS OF THE REGISTRANT
Pursuant to General Instruction G of Form 10-K, the following
list is included as an unnumbered Item in Part I of this report
in lieu of being included in the Proxy Statement for the Annual
Meeting of Shareholders to be held on June 20, 2002.
The following is a list of names and ages of all of the
executive officers of the registrant indicating all positions and
offices with the registrant held by each such person and each
such person's principal occupation or employment during the past
five years. All such persons have been elected to serve until
the next annual election of officers (which shall occur on June
20, 2002) and their successors are elected, or until their
earlier resignation or removal. No person other than those
listed below has been chosen to become an executive officer of
the registrant.
5
Keith S. Walters, Chairman of the Board, CEO and President,
age 52, was elected Chief Executive Officer in November 1997,
Chairman in June 1998 and President in July 1998. Mr. Walters
was employed by the Company in August 1997 and was elected to the
office of Vice President Commercial Printing Operations at that
time. Prior to joining the Company, Mr. Walters was with
Atlas/Soundolier, a division of American Trading and Production
Company, for 8 years, most recently as Vice President of
Manufacturing. Prior to that time, Mr. Walters was with the
Automotive Division of United Technologies Corporation for 15
years, primarily in manufacturing and operations.
Ronald M. Graham, Vice President Administration, age 54, was
elected Vice President Administration in April 2001. Mr. Graham
was employed by the Company in January 1998 as Director of Human
Relations and was elected Vice President Human Resources in June
1998. Prior to joining the Company, Mr. Graham was with E. V.
International, Inc. (formerly Mark IV Industries, Inc.) for 17
years as Corporate Vice President, Administration. Prior to that
time, Mr. Graham was with Sheller-Globe (door div.) for 3 years
as Corporate Director of Human Resources.
Robert M. Halowec, Vice President Finance and Chief
Financial Officer, age 47, was elected Vice President Finance and
Chief Financial Officer in January 1999. Mr. Halowec was
employed by the Company in January 1999 as Vice President Finance
and Chief Financial Officer. Prior to joining the Company, Mr.
Halowec was with Moore Corporation for 13 years, most recently as
Financial Director of Moore's Cut Products Group in Nacogdoches,
Texas.
Harve Cathey, Secretary and Treasurer, age 63, was elected
Secretary in October 1998 and Treasurer in July 1998. Mr. Cathey
has been employed by the Company continuously since April 1969.
Previously, Mr. Cathey served as Vice President-Finance and
Secretary (from September 1983 to September 1996) and Treasurer
(from June 1978 to December 1992).
Kenneth E. Overstreet, Group President of the Company's
Financial Solution and Promotional Solution Groups, age 59, was
appointed Group President of the Company's Promotional Solution
Group in March 2001. Mr. Overstreet was employed by the Company
in June 2000 as the Group President of the Company's Financial
Solution Group, as a result of the acquisition of Northstar
Computer Forms, Inc. (NSCF). Prior to June 2000, Mr. Overstreet
was with NSCF since 1989, serving as President since 1993.
There is no family relationship among or between any
executive officers of the registrant, nor any family relationship
between any executive officers and directors.
6
PART II
-------
Item 5. Market for the Registrant's Common Equity and Related
- ------- -----------------------------------------------------
Shareholder Matters.
--------------------
The Company's common stock is traded on the New York Stock
Exchange. The following table sets forth for the periods
indicated: the high and low closing sales prices and the common
stock trading volume as reported by the New York Stock Exchange
and dividends declared by the Company.
Common
Stock
Trading
Common Stock Volume Dividends
Price Range (number of per share
----------- shares in of Common
High Low Thousands) Stock
---- --- ---------- -----
Fiscal Year Ended February 28, 2002
First Quarter $9.1500 $7.4700 1,531 $0.155
Second Quarter 9.1200 7.5500 917 0.155
Third Quarter 9.5300 7.7000 594 0.155
Fourth Quarter 10.8800 9.0700 1,131 0.155
Fiscal Year Ended February 28, 2001
First Quarter $8.2500 $6.6875 1,284 $0.155
Second Quarter 8.5000 6.7500 1,461 0.155
Third Quarter 8.0000 6.5625 1,225 0.155
Fourth Quarter 8.4500 7.0000 1,496 0.155
On April 15, 2002, the last sale price of the common stock
was $12.89 per share and the number of shareholders of record was
1,432.
7
Item 6. Selected Financial Data.
- ------- ------------------------
The information required by this item is incorporated herein
by reference to page 14 of the Company's 2002 Annual Report to
Shareholders which is attached as Exhibit (13) hereto.
Item 7. Management's Discussion and Analysis of Financial
- ------- -------------------------------------------------
Condition and Results of Operations.
------------------------------------
The information required by this item is incorporated herein
by reference to pages 14 through 17 of the Company's 2002 Annual
Report to Shareholders which is attached as Exhibit (13) hereto.
Item 7a. Quantitative and Qualitative Disclosure
- -------- ---------------------------------------
About Market Risk.
------------------
The information required by this item is incorporated by
reference to page 17 of the Company's 2002 Annual Report to
Shareholders which is attached as Exhibit (13) hereto.
Item 8. Financial Statements and Supplementary Data.
- ------- --------------------------------------------
The information required by this item is incorporated herein
by reference to pages 20 through 36 of the Company's 2002 Annual
Report to Shareholders which is attached as Exhibit (13) hereto.
Item 9. Changes in and Disagreements with Accountants
- ------- ---------------------------------------------
on Accounting and Financial Disclosure.
---------------------------------------
Not applicable.
8
PART III
--------
Item 10. Directors and Executive Officers of the Registrant.
- -------- ---------------------------------------------------
For information with respect to executive officers of the
registrant, see "Executive Officers of the Registrant" at the end
of Part I of this report.
The information required by this item regarding Directors is
incorporated by reference to pages 3 through 7 of the Company's
Proxy Statement dated May 17, 2002.
Item 11. Executive Compensation.
- -------- -----------------------
The information required by this item is incorporated herein
by reference to pages 6 through 13 of the Company's Proxy
Statement dated May 17, 2002.
Item 12. Security Ownership of Certain Beneficial
- -------- -----------------------------------------
Owners and Management.
----------------------
The information required by this item is incorporated herein
by reference to pages 2 through 3 of the Company's Proxy
Statement dated May 17, 2002.
Item 13. Certain Relationships and Related Transactions.
- -------- -----------------------------------------------
There were no significant transactions between the Company
and any directors or officers during the past fiscal year.
9
PART IV
-------
Item 14. Exhibits, Financial Statement Schedule,
- -------- ----------------------------------------
and Reports on Form 8-K.
------------------------
(a) 1. (a) 2. Financial Statements and Financial
Statement Schedule.
See accompanying index to financial statements
and financial statement schedule for a list of all
financial statements and the financial statement
schedule filed as part of this report (page S-1).
3. Exhibits
(i) Restated Articles of Incorporation as
amended through June 23, 1983 with attached
amendments dated June 20, 1985, July 31, 1985 and
June 16, 1988 incorporated herein by reference to
Exhibit 5 to the Registrant's Form 10-K Annual Report
for the fiscal year ended February 28, 1993.
(ii) Bylaws of the Registrant as amended through
October 15, 1997 incorporated herein by reference
to Exhibit 3(ii) to the Registrants Form 10-Q
Quarterly Report for the quarter ended
November 30, 1997.
(13) Portions of 2002 Annual Report to Shareholders.
(21) Subsidiaries of Registrant.
(23.1) Independent Auditors' Consent.
(23.2) Independent Auditors' Consent.
(b) Reports on Form 8-K:
--------------------
The Company filed a report on Form 8-K on January 29,
2002 regarding changes in Registrant's Certifying
Accountant pursuant to Item 4 of such Form.
10
UNDERTAKINGS WITH RESPECT TO REGISTRANT'S REGISTRATION
STATEMENTS, FORM S-8
(NUMBERS: 33-43087, 333-58963, 333-44624, 333-38100)
(1) The undersigned registrant hereby undertakes to deliver
or cause to be delivered with the prospectus, forming a part of
the referenced registration statement, to each person to whom the
prospectus is sent or given, the latest annual report to security
holders that is incorporated by reference in the prospectus and
furnished pursuant to and meeting the requirements of Rule 14a-3
or Rule 14c-3 under the Securities Exchange Act of 1934; and,
where interim financial information required to be presented by
Article 3 of Regulation S-X is not set forth in the prospectus,
to deliver, or cause to be delivered, to each person to whom the
prospectus is sent or given, the latest quarterly report that is
specifically incorporated by reference in the prospectus to
provide such interim financial information.
(2) The undersigned registrant hereby undertakes to deliver
or cause to be delivered with the prospectus to each employee to
whom the prospectus is sent or given a copy of the registrant's
annual report to shareholders for its last fiscal year, unless
such employee otherwise has received a copy of such report, in
which case the registrant shall state in the prospectus that it
will promptly furnish, without charge, a copy of such report on
written request of the employee. If the last fiscal year of the
registrant has ended within 120 days prior to the use of the
prospectus, the annual report of the registrant for the preceding
fiscal year may be so delivered, but within such 120 day period
the annual report for the last fiscal year will be furnished to
each such employee.
(3) The undersigned registrant hereby undertakes to
transmit or cause to be transmitted to all employees
participating in the plan who do not otherwise receive such
material as shareholders of the registrant, at the time and in
the manner such material is sent to its shareholders, copies of
all reports, proxy statements and other communications
distributed to its shareholders generally.
11
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
(Registrant)
ENNIS BUSINESS FORMS, INC.
Date: May 20, 2002 BY: /s/ Keith S. Walters
------------ ------------------------------
Keith S. Walters, Chairman of
the Board, Chief Executive
Officer and President
Date: May 20, 2002 BY: /s/ Robert M. Halowec
------------ ------------------------------
Robert M. Halowec
Vice President - Finance and
Chief Financial Officer
Date: May 20, 2002 BY: /s/ Harve Cathey
------------ ------------------------------
Harve Cathey
Secretary and Treasurer,
Principal Accounting Officer
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of the Registrant and in the capacities and on
the dates indicated.
Date: May 20, 2002 BY: /s/ Keith S. Walters
------------ ------------------------------
Keith S. Walters, Director
Date: May 20, 2002 BY: /s/ Ewell L. Tankersley
------------ ------------------------------
Ewell L. Tankersley, Director
Date: May 20, 2002 BY: /s/ Robert L. Mitchell
------------ ------------------------------
Robert L. Mitchell, Director
Date: May 20, 2002 BY: /s/ Thomas R. Price
------------ ------------------------------
Thomas R. Price, Director
Date: May 20, 2002 BY: /s/ Kenneth G. Pritchett
------------ ------------------------------
Kenneth G. Pritchett, Director
12
INDEX TO FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULE
The following is a list of the financial statements and
financial statement schedule which are included in this Form 10-K
or which are incorporated herein by reference. The consolidated
financial statements of the Company included in the Company's
2002 Annual Report to Shareholders are incorporated herein by
reference in Item 8. With the exception of the pages listed in
this index and pages listed in Items 1, 6, 7 and 8 incorporating
certain portions of the Company's 2002 Annual Report to
Shareholders, such 2002 Annual Report to Shareholders is not
deemed to be filed as part of this Form 10-K.
2002
Annual
Report to
Form Share-
10-K holders
---- -------
Consolidated Financial Statements of the Company:
Consolidated Balance Sheets - February 28,
2002 and 2001 22
Consolidated Statements of Earnings -
years ended February 28 or 29, 2002,
2001 and 2000 20
Consolidated Statements of Cash Flows -
years ended February 28 or 29, 2002,
2001 and 2000 21
Notes to Consolidated Financial Statements 23 - 35
Independent Auditors' Report for years
ended February 28, 2001 and
February 29, 2000 S-2
Independent Auditors' Report for year
ended February 28, 2002 S-3
II - Valuation and qualifying accounts S-4
All other schedules are omitted as the required information is
inapplicable or the information is presented in the financial
statement or related notes.
S-1
Independent Auditors' Report
The Board of Directors and Shareholders
Ennis Business Forms, Inc.:
We have audited the consolidated balance sheet of Ennis Business
Forms, Inc. and subsidiaries as of February 28, 2001 and the
related consolidated statements of earnings and cash flows for
each of the years in the two-year period ended February 28, 2001.
We also have audited the related financial statement schedule for
the two-year period ended February 28, 2001. These consolidated
financial statements and financial statement schedule are the
responsibility of the Company's management. Our responsibility
is to express an opinion on these consolidated financial
statements and financial statement schedule based on our audits.
We conducted our audits in accordance with auditing standards
generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial
position of Ennis Business Forms, Inc. and subsidiaries as of
February 28, 2001, and the results of their operations and their
cash flows for each of the years in the two-year period ended
February 28, 2001, in conformity with accounting principles
generally accepted in the United States of America. Also, in our
opinion, the related financial statement schedule, when
considered in relation to the basic consolidated financial
statements taken as a whole, presents fairly, in all material
respects, the information set forth therein for the two-year
period ended February 28, 2001.
/s/ KPMG LLP
Dallas, Texas
April 12, 2001
S-2
Report of Independent Auditors
Board of Directors and Shareholders
Ennis Business Forms, Inc.
We have audited the accompanying consolidated balance sheet of
Ennis Business Forms, Inc. and subsidiaries (the Company) as of
February 28, 2002, and the related consolidated statements of
earnings and cash flows for the year then ended. Our audit also
included the financial statement schedule listed in the Index at
Item 14(a). These financial statements and schedule are the
responsibility of the Company's management. Our responsibility is
to express an opinion on these financial statements based on our
audit.
We conducted our audit in accordance with auditing standards
generally accepted in the United States. Those standards require
that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting
principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our
opinion.
In our opinion, the 2002 consolidated financial statements
referred to above present fairly, in all material respects, the
consolidated financial position of Ennis Business Forms, Inc. and
subsidiaries as of February 28, 2002, and the consolidated
results of their operations and their cash flows for the year
then ended, in conformity with accounting principles generally
accepted in the United States. Also, in our opinion, the related
financial statement schedule, when considered in relation to the
basic financial statements taken as a whole, presents fairly in
all material respects the information set forth therein.
ERNST & YOUNG, LLP
Dallas, Texas
April 5, 2002
S-3
Schedule II
ENNIS BUSINESS FORMS, INC. AND SUBSIDIARIES
Valuation and Qualifying Accounts
Three Years Ended February 28, 2002
(In thousands)
Additions
Balance at Charged Charged Balance
beginning to to other at end
Description of year operations accounts Deductions of year
----------- ---------- ---------- -------- ---------- -------
Year ended February 28, 2002:
Allowance for
doubtful receivables $1,484 1,007 25 (2) 1,030 (3) 1,486
====== ===== ====== ========= =====
Year ended February 28, 2001:
Allowance for
doubtful receivables $1,263 901 241 (1) 921 (3) 1,484
====== === ======= ======= =====
Year ended February 29, 2000:
Allowance for
doubtful receivables $1,202 481 59 (2) 479 (3) 1,263
====== === ====== ======= =====
Notes:
- ------
(1) Principally Allowance from Acquisition of Northstar Computer Forms, Inc.
(2) Principally collection of accounts previously charged off.
(3) Charge-off of uncollectible receivables.
S-4