Ennis, Inc. (NYSE: EBF) posted a 3.3% rise in revenue to $102.0 million for the quarter ended August 31, 2026. Net earnings declined 29% year-over-year to $9.4 million, primarily due to litigation-related charges and higher input costs.

The company’s Board of Directors declared a 5.0% increase in the quarterly cash dividend, raising the payout from $0.25 to $0.2625 per share. The dividend is payable on November 6, 2026, to shareholders of record on October 9, 2026.

Financial Performance

Revenues for the first six months of fiscal 2027 reached $200.6 million, up 2.4% from $195.9 million in the same period last year. Gross profit totaled $30.5 million, resulting in a gross margin of 29.9%, down from 30.5% in the prior-year quarter. Management attributed the margin contraction to higher carbonless paper costs recognized in cost of sales compared with the previous year.

Net earnings for the six-month period were $19.3 million, or $0.76 per diluted share, compared to $23.0 million, or $0.89 per share, in the corresponding period last year.

What the Numbers Show

The divergence between operating performance and bottom-line results highlights significant volatility from non-recurring items. While income from operations rose to $13.6 million from $12.4 million year-ago, net earnings fell sharply. This discrepancy is driven by a swing in other income/expense: the current quarter recorded a $0.5 million expense versus a $5.8 million gain in the prior-year period. The prior-year gain included a $5.3 million favorable litigation judgment, whereas the current quarter includes a $0.7 million charge related to lease litigation. Excluding these items, diluted EPS increased by $0.02.

Balance Sheet and Cash Flow

Operating cash flow for the first six months surged to $34.1 million, nearly doubling the $18.4 million generated in the prior-year period. Cash balances increased to $54.0 million as of August 31, 2026, up from $34.6 million at the start of the fiscal year. The company maintains a debt-free balance sheet, providing liquidity for operations, acquisitions, and shareholder returns.

Acquisitions completed during fiscal 2026 contributed approximately $2.3 million in revenue for the quarter and positively impacted diluted EPS by $0.01. Year-to-date, these acquisitions contributed $6.8 million in revenue.

Ennis reported financial results for the quarter ended May 31, 2026, with earnings per share meeting analyst estimates and sales surpassing expectations. The company posted quarterly earnings of $0.39 per share, a 2.63% increase from $0.38 in the prior-year quarter, matching the consensus estimate. Sales rose 1.46% to $98.615 million, beating the analyst consensus estimate of $98.200 million by 0.42%. Acquisitions completed during fiscal year 2026 contributed approximately $4.5 million in revenue and positively impacted diluted earnings per share by $0.02.

Net earnings increased to $9.9 million from $9.8 million in the same period last year. Operating cash flow increased significantly to $21.2 million from $8.0 million, driving cash balances to $49.1 million from $34.6 million at February 28, 2026. The company maintains a strong financial position with no debt and ample liquidity. Management noted the successful transition to alternative supply sources for carbonless paper following the closure of a domestic producer, without anticipating disruption to customer service.

Gross profit margin improved to 31.5% from 31.1% in the comparative quarter last year and 29.2% in the fourth quarter of fiscal 2026. EBITDA increased to $18.0 million, or 18.2% of sales, compared to $17.7 million, or 18.2% of sales, in the same quarter last year.

Financial Performance

Dividend Declaration

On June 19, 2026, the Board of Directors declared a quarterly cash dividend of 25.0 cents per share on the company’s common stock. The dividend is payable on August 10, 2026 to shareholders of record on July 10, 2026.