##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
  þ
    
    Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
 For the Quarterly Period Ended August 31, 2008
 OR
 o
    
    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, INC.
  Texas
    
    75-0256410(State or Other Jurisdiction of 
Incorporation or Organization)
    
    (I.R.S. Employer Identification No.)2441 Presidential Pkwy., Midlothian, Texas
    
    76065(Address of Principal Executive Offices)
    
    (Zip code)
 (972) 775-9801
  þ o
  Large accelerated filer o
Accelerated filer þ
Non-accelerated filer o(Do not check if a smaller reporting company)Smaller reporting company o o þ




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##### 



ENNIS, INC. AND SUBSIDIARIES
FORM 10-Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 TABLE OF CONTENTS
 PART I: FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    3Consolidated Balance Sheets at August 31, 2008 (unaudited) and February 29, 2008
    
    
    3Unaudited Consolidated Statements of Earnings for the three and six months ended August 31, 2008
and 2007
    
    
    5Unaudited Consolidated Statements of Cash Flows for the six months ended August 31, 2008 and 2007
    
    
    6Notes to the Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    22Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    38Item 4. Controls and Procedures
    
    
    39PART II: OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    39Item 1A. Risk Factors
    
    
    39Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    39Item 3. Defaults Upon Senior Securities
    
    
    39Item 4. Submission of Matters to a Vote of Security Holders
    
    
    39Item 5. Other Information
    
    
    39Item 6. Exhibits
    
    
    40SIGNATURES
    
    
    41Employment AgreementCertification Pursuant to Rule 13a-14(a)/15d-14(a) of Chief Executive OfficerCertification Pursuant to Rule 13a-14(a)/15d-14(a) of Chief Financial OfficerSection 1350 Certification of Chief Executive OfficerSection 1350 Certification of Chief Financial Officer
  2




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##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. FINANCIAL STATEMENTS
 
 ENNIS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS  (Dollars in thousands )
 August 31,
    
    
    February 29,2008
    
    
    2008(unaudited)AssetsCurrent assetsCash and cash equivalents
    
    $
    10,164
    
    
    $
    3,393Accounts receivable, net of allowance for doubtful receivables
of $5,324 at August 31, 2008 and $3,954 at February 29, 2008
    
    
    77,179
    
    
    
    72,278Prepaid expenses
    
    
    3,956
    
    
    
    3,500Prepaid income taxes
    
    
    1,117
    
    
    
    Inventories
    
    
    90,712
    
    
    
    98,570Deferred income taxes
    
    
    7,786
    
    
    
    7,786Assets held for sale
    
    
    187
    
    
    
    292Total current assets
    
    
    191,101
    
    
    
    185,819Property, plant and equipment, at costPlant, machinery and equipment
    
    
    131,470
    
    
    
    130,214Land and buildings
    
    
    42,936
    
    
    
    42,793Other
    
    
    22,686
    
    
    
    22,586Total property, plant and equipment
    
    
    197,092
    
    
    
    195,593Less accumulated depreciation
    
    
    140,190
    
    
    
    136,605Net property, plant and equipment
    
    
    56,902
    
    
    
    58,988Goodwill
    
    
    178,388
    
    
    
    178,388Trademarks and tradenames, net
    
    
    63,805
    
    
    
    63,880Customer lists, net
    
    
    23,133
    
    
    
    24,260Deferred finance charges, net
    
    
    710
    
    
    
    934Prepaid pension asset
    
    
    
    
    
    
    260Other assets
    
    
    496
    
    
    
    602Total assets
    
    $
    514,535
    
    
    $
    513,131
 See accompanying notes to consolidated financial statements.
 3




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ENNIS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS  (Dollars in thousands, except for share and per share amounts )
 August 31,
    
    
    February 29,2008
    
    
    2008(unaudited)Liabilities and Shareholders EquityCurrent liabilitiesAccounts payable
    
    $
    33,702
    
    
    $
    29,658Accrued expensesEmployee compensation and benefits
    
    
    14,827
    
    
    
    14,840Taxes other than income
    
    
    1,320
    
    
    
    989Federal and state income taxes payable
    
    
    
    
    
    
    501Other
    
    
    5,092
    
    
    
    5,583Current installments of long-term debt
    
    
    224
    
    
    
    255Total current liabilities
    
    
    55,165
    
    
    
    51,826Long-term debt, less current installments
    
    
    77,056
    
    
    
    90,710Liability for pension benefits
    
    
    410
    
    
    
    Deferred income taxes
    
    
    20,496
    
    
    
    20,775Other liabilities
    
    
    494
    
    
    
    1,341Total liabilities
    
    
    153,621
    
    
    
    164,652Commitments and contingenciesShareholders equitySeries A junior participating preferred stock of $10 par value,
Authorized 1,000,000 shares; none issued
    
    
    
    
    
    
    Common stock $2.50 par value, authorized 40,000,000 shares;
issued 30,053,443 shares at August 31 and February 29, 2008
    
    
    75,134
    
    
    
    75,134Additional paid in capital
    
    
    122,588
    
    
    
    122,566Retained earnings
    
    
    247,916
    
    
    
    235,624Accumulated other comprehensive income (loss):Foreign currency translation
    
    
    725
    
    
    
    929Unrealized gain (loss) on derivative instruments
    
    
    (289
    )
    
    
    Minimum pension liability
    
    
    (6,450
    )
    
    
    (6,450
    )(6,014
    )
    
    
    (5,521
    )439,624
    
    
    
    427,803Treasury stockCost of 4,357,169 shares at August 31, 2008 and
4,391,193 shares at February 29, 2008
    
    
    (78,710
    )
    
    
    (79,324
    )Total shareholders equity
    
    
    360,914
    
    
    
    348,479Total liabilities and shareholders equity
    
    $
    514,535
    
    
    $
    513,131
 See accompanying notes to consolidated financial statements.
 4




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ENNIS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
( Dollars in thousands except per share amounts )
(Unaudited)
 Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net sales
    
    $
    161,050
    
    
    $
    150,086
    
    
    $
    324,250
    
    
    $
    302,860Cost of goods sold
    
    
    121,812
    
    
    
    108,747
    
    
    
    244,560
    
    
    
    220,163Gross profit
    
    
    39,238
    
    
    
    41,339
    
    
    
    79,690
    
    
    
    82,697Selling, general and administrative
    
    
    23,738
    
    
    
    22,264
    
    
    
    45,927
    
    
    
    44,900(Gain) loss from disposal of assets
    
    
    (213
    )
    
    
    (1
    )
    
    
    (267
    )
    
    
    11Income from operations
    
    
    15,713
    
    
    
    19,076
    
    
    
    34,030
    
    
    
    37,786Other income (expense)Interest expense
    
    
    (892
    )
    
    
    (1,393
    )
    
    
    (1,925
    )
    
    
    (2,885
    )Other expense, net
    
    
    (112
    )
    
    
    (3
    )
    
    
    (173
    )
    
    
    (84
    )(1,004
    )
    
    
    (1,396
    )
    
    
    (2,098
    )
    
    
    (2,969
    )Earnings before income taxes
    
    
    14,709
    
    
    
    17,680
    
    
    
    31,932
    
    
    
    34,817Provision for income taxes
    
    
    5,368
    
    
    
    6,542
    
    
    
    11,655
    
    
    
    12,883Net earnings
    
    $
    9,341
    
    
    $
    11,138
    
    
    $
    20,277
    
    
    $
    21,934Weighted average common shares
outstandingBasic
    
    
    25,684,769
    
    
    
    25,601,683
    
    
    
    25,676,521
    
    
    
    25,593,522Diluted
    
    
    25,805,263
    
    
    
    25,855,156
    
    
    
    25,798,245
    
    
    
    25,857,065Per share amountsNet earnings  basic
    
    $
    0.36
    
    
    $
    0.44
    
    
    $
    0.79
    
    
    $
    0.86Net earnings  diluted
    
    $
    0.36
    
    
    $
    0.43
    
    
    $
    0.79
    
    
    $
    0.85Cash dividends per share
    
    $
    0.155
    
    
    $
    0.155
    
    
    $
    0.310
    
    
    $
    0.310
 See accompanying notes to consolidated financial statements.
 5




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ENNIS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS  (Dollars in thousands)  (Unaudited)
 Six months endedAugust 31,2008
    
    
    2007Cash flows from operating activities:Net earnings
    
    $
    20,277
    
    
    $
    21,934Adjustments to reconcile net earnings to net cash provided
by operating activities:Depreciation
    
    
    5,159
    
    
    
    6,430Amortization of deferred finance charges
    
    
    224
    
    
    
    224Amortization of trademarks and customer lists
    
    
    1,210
    
    
    
    929(Gain) loss from disposal of assets
    
    
    (267
    )
    
    
    11Bad debt expense
    
    
    2,029
    
    
    
    896Stock based compensation
    
    
    531
    
    
    
    321Excess tax benefit of stock based compensation
    
    
    
    
    
    
    (337
    )Deferred income taxes
    
    
    
    
    
    
    (254
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    (7,086
    )
    
    
    (8,043
    )Prepaid expenses
    
    
    (1,543
    )
    
    
    1,462Inventories
    
    
    7,610
    
    
    
    (9,036
    )Other assets
    
    
    98
    
    
    
    (35
    )Accounts payable and accrued expenses
    
    
    2,951
    
    
    
    2,998Other liabilities
    
    
    (846
    )
    
    
    (819
    )Prepaid pension asset/liability for pension benefits
    
    
    670
    
    
    
    808Net cash provided by operating activities
    
    
    31,017
    
    
    
    17,489Cash flows from investing activities:Capital expenditures
    
    
    (3,214
    )
    
    
    (1,777
    )Proceeds from disposal of plant and property
    
    
    610
    
    
    
    27Net cash used in investing activities
    
    
    (2,604
    )
    
    
    (1,750
    )Cash flows from financing activities:Borrowings on debt
    
    
    
    
    
    
    Repayment of debt
    
    
    (14,144
    )
    
    
    (8,896
    )Dividends
    
    
    (7,985
    )
    
    
    (7,943
    )Proceeds from exercise of stock options
    
    
    105
    
    
    
    658Excess tax benefit of stock based compensation
    
    
    
    
    
    
    337Net cash used in financing activities
    
    
    (22,024
    )
    
    
    (15,844
    )Effect of exchange rate changes on cash
    
    
    382
    
    
    
    53Net change in cash and cash equivalents
    
    
    6,771
    
    
    
    (52
    )Cash and cash equivalents at beginning of period
    
    
    3,393
    
    
    
    3,582Cash and cash equivalents at end of period
    
    $
    10,164
    
    
    $
    3,530
 See accompanying notes to consolidated financial statements.
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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 1. Significant Accounting Policies and General Matters
 Basis of Presentation
  Reclassifications
  Three Months Ended August 31, 2007Distribution
    
    (Gain) Loss
    
    OtherAs Previously
    
    Warehousing
    
    From Disposal
    
    AdministrativeReported
    
    Expense
    
    of assets
    
    Expense
    
    ReclassifiedCost of goods sold
    
    $
    111,466
    
    
    $
    (2,719
    )
    
    $
    
    
    
    $
    
    
    
    $
    108,747Selling, general and
administrative
    
    
    18,744
    
    
    
    2,719
    
    
    
    
    
    
    
    801
    
    
    
    22,264(Gain) loss from disposal
of assets
    
    
    
    
    
    
    
    
    
    
    (1
    )
    
    
    
    
    
    
    (1
    )Other income (expense), net
    
    
    (803
    )
    
    
    
    
    
    
    (1
    )
    
    
    801
    
    
    
    (3
    )
 Six Months Ended August 31, 2007Distribution
    
    (Gain) Loss
    
    OtherAs Previously
    
    Warehousing
    
    From Disposal
    
    AdministrativeReported
    
    Expense
    
    of assets
    
    Expense
    
    ReclassifiedCost of goods sold
    
    $
    225,673
    
    
    $
    (5,510
    )
    
    $
    
    
    
    $
    
    
    
    $
    220,163Selling, general and
administrative
    
    
    37,731
    
    
    
    5,510
    
    
    
    
    
    
    
    1,659
    
    
    
    44,900(Gain) loss from disposal
of assets
    
    
    
    
    
    
    
    
    
    
    11
    
    
    
    
    
    
    
    11Other income (expense), net
    
    
    (1,754
    )
    
    
    
    
    
    
    11
    
    
    
    1,659
    
    
    
    (84
    )
 7




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 1. Significant Accounting Policies and General Matters-continued
 Recent Accounting Pronouncements
 FAS 141R.
 FAS 161.
 FSP FAS 142-3.
 FAS 162. The Meaning of Present Fairly in Conformity with Generally Accepted
Accounting Principles
 FSP EITF 03-6-1.
 8




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 2. Due From Factors
     3. Accounts Receivable and Allowance for Doubtful Receivables
    Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Balance at beginning of period
    
    $
    3,721
    
    
    $
    2,973
    
    
    $
    3,954
    
    
    $
    2,698Bad debt expense
    
    
    2,029
    
    
    
    523
    
    
    
    2,029
    
    
    
    896Recoveries
    
    
    9
    
    
    
    2
    
    
    
    13
    
    
    
    3Accounts written off
    
    
    (435
    )
    
    
    (122
    )
    
    
    (672
    )
    
    
    (221
    )Balance at end of period
    
    $
    5,324
    
    
    $
    3,376
    
    
    $
    5,324
    
    
    $
    3,376
 9




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 4. Inventories
   August 31,
    
    
    February 29,2008
    
    
    2008Raw material
    
    $
    15,584
    
    
    $
    14,711Work-in-process
    
    
    21,250
    
    
    
    15,467Finished goods
    
    
    53,878
    
    
    
    68,392$
    90,712
    
    
    $
    98,570
 5. Acquisitions
   Accounts receivable
    
    $
    2,713Inventories
    
    
    1,711Other assets
    
    
    66Property, plant & equipment
    
    
    2,662Customer lists
    
    
    5,084Trademarks
    
    
    671Noncompete
    
    
    18Accounts payable and accrued liabilities
    
    
    (443
    )$
    12,482
  10




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 5. Acquisitions-continued
  Accounts receivable
    
    $
    974Inventories
    
    
    346Property, plant & equipment
    
    
    419Customer lists
    
    
    767Trademarks
    
    
    306Noncompete
    
    
    15Accounts payable and accrued liabilities
    
    
    (171
    )$
    2,656
  Three months ended
    
    Six months endedAugust 31,
    
    August 31,2007
    
    2007Pro forma net sales
    
    $
    159,212
    
    
    $
    321,112Pro forma net earnings
    
    
    11,304
    
    
    
    22,266Pro forma earnings per share  diluted
    
    
    0.44
    
    
    
    0.86
  6. Goodwill and Other Intangible Assets
   11




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 6. Goodwill and Other Intangible Assets-continued
  GrossCarrying
    
    
    AccumulatedAs of August 31, 2008
    
    Amount
    
    
    Amortization
    
    
    NetAmortized intangible assets (in thousands)Tradenames
    
    $
    1,234
    
    
    $
    667
    
    
    $
    567Customer lists
    
    
    29,908
    
    
    
    6,775
    
    
    
    23,133Noncompete
    
    
    500
    
    
    
    459
    
    
    
    41$
    31,642
    
    
    $
    7,901
    
    
    $
    23,741
 As of February 29, 2008Amortized intangible assets (in thousands)Tradenames
    
    $
    1,234
    
    
    $
    592
    
    
    $
    642Customer lists
    
    
    29,908
    
    
    
    5,648
    
    
    
    24,260Noncompete
    
    
    500
    
    
    
    451
    
    
    
    49$
    31,642
    
    
    $
    6,691
    
    
    $
    24,951
 August 31,
    
    
    February 29,2008
    
    
    2008Non-amortizing intangible assets (in thousands)Trademarks
    
    $
    63,238
    
    
    $
    63,238
   2009
    
    $
    2,419,0002010
    
    
    2,403,0002011
    
    
    2,397,0002012
    
    
    2,391,0002013
    
    
    2,347,0002014
    
    
    2,254,000
  Print
    
    
    ApparelSegment
    
    
    SegmentTotal
    
    
    Total
    
    
    TotalBalance as of March 1, 2007
    
    $
    40,614
    
    
    $
    137,700
    
    
    $
    178,314Goodwill acquired
    
    
    74
    
    
    
    
    
    
    
    74Balance as of March 1, 2008
    
    
    40,688
    
    
    
    137,700
    
    
    
    178,388Goodwill acquired
    
    
    
    
    
    
    
    
    
    
    Balance as of August 31, 2008
    
    $
    40,688
    
    
    $
    137,700
    
    
    $
    178,388
  12




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 7. Other Accrued Expenses
  August 31, 2008
    
    
    February 29, 2008Accrued interest
    
    $
    295
    
    
    $
    604Accrued tax expense
    
    
    334
    
    
    
    405Accrued legal and professional fees
    
    
    308
    
    
    
    244Accrued utilities
    
    
    1,750
    
    
    
    1,358Accrued repairs and maintenance
    
    
    342
    
    
    
    274Accrued contract labor
    
    
    
    
    
    
    280Factored receivables with recourse
    
    
    15
    
    
    
    539Other accrued expenses
    
    
    2,048
    
    
    
    1,879$
    5,092
    
    
    $
    5,583
 8. Derivative Instruments and Hedging Activities
    9. Fair Value Financial Instruments
   Level 1 
    
    Inputs utilize quoted prices (unadjusted) in active markets for identical
assets or liabilities that the Company has the ability to accessLevel 2 
    
    Inputs utilize data points that are observable such as quoted prices,
interest rates and yield curves.Level 3 
    
    Inputs are unobservable data points for the asset or liability, and
include situations where there is little, if any, market activity for the asset or
liability.
 13




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 9. Fair Value Financial Instruments-continued
   Fair Value Measurements UsingQuoted Prices in Active
    
    
    Significant Other
    
    
    SignificantMarkets for Identical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Input
    
    
    InputsDescription
    
    August 31, 2008
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Derivative liability
    
    $
    459
    
    
    $
    
    
    
    $
    459
    
    
    $
    $
    459
    
    
    $
    
    
    
    $
    459
    
    
    $
    
 10. Long-Term Debt
  August 31, 2008
    
    
    February 29, 2008Revolving credit facility
    
    $
    76,500
    
    
    $
    90,500Capital lease obligations
    
    
    321
    
    
    
    452Other
    
    
    459
    
    
    
    1377,280
    
    
    
    90,965Less current installments
    
    
    224
    
    
    
    255Long-term debt
    
    $
    77,056
    
    
    $
    90,710
   14




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ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 11. Shareholders Equity
  Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net earnings
    
    $
    9,341
    
    
    $
    11,138
    
    
    $
    20,277
    
    
    $
    21,934Foreign currency translation adjustment,
net of deferred taxes
    
    
    (184
    )
    
    
    43
    
    
    
    (204
    )
    
    
    477Unrealized loss on derivative instruments,
net of deferred taxes
    
    
    (289
    )
    
    
    
    
    
    
    (289
    )
    
    
    Comprehensive income
    
    $
    8,868
    
    
    $
    11,181
    
    
    $
    19,784
    
    
    $
    22,411
  AccumulatedAdditional
    
    
    
    
    
    
    OtherCommon Stock
    
    
    Paid-in
    
    
    Retained
    
    
    Comprehensive
    
    
    Treasury StockShares
    
    
    Amount
    
    
    Capital
    
    
    Earnings
    
    
    Income (Loss)
    
    
    Shares
    
    
    Amount
    
    
    TotalBalance February 29, 2008
    
    
    30,053,443
    
    
    $
    75,134
    
    
    $
    122,566
    
    
    $
    235,624
    
    
    $
    (5,521
    )
    
    
    (4,391,193
    )
    
    $
    (79,324
    )
    
    $
    348,479Net earnings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,277
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    20,277Foreign currency
translation,
net of deferred tax
of $120
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (204
    )
    
    
    
    
    
    
    
    
    
    
    (204
    )Unrealized loss on
derivative
instruments, net
of deferred tax of
$170
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (289
    )
    
    
    
    
    
    
    
    
    
    
    (289
    )Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    19,784Dividends declared
($.31 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,985
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,985
    )Stock based
compensation
    
    
    
    
    
    
    
    
    
    
    531
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    531Exercise of stock
options
and restricted
stock grants
    
    
    
    
    
    
    
    
    
    
    (509
    )
    
    
    
    
    
    
    
    
    
    
    34,024
    
    
    
    614
    
    
    
    105Balance August 31, 2008
    
    
    30,053,443
    
    
    $
    75,134
    
    
    $
    122,588
    
    
    $
    247,916
    
    
    $
    (6,014
    )
    
    
    (4,357,169
    )
    
    $
    (78,710
    )
    
    $
    360,914
 12. Stock Option Plans and Stock Based Compensation
    15




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 12. Stock Option Plans and Stock Based Compensation-continued
  WeightedNumber
    
    Weighted
    
    Average
    
    Aggregateof
    
    Average
    
    Remaining
    
    IntrinsicShares
    
    Exercise
    
    Contractual
    
    Value(a)(exact quantity)
    
    Price
    
    Life (in years)
    
    (in thousands)Outstanding at February 29, 2008
    
    
    469,513
    
    
    $
    10.97
    
    
    
    2.9Granted
    
    
    
    
    
    
    Terminated
    
    
    (40,000
    )
    
    
    11.41Exercised
    
    
    (10,500
    )
    
    
    10.06Outstanding at August 31, 2008
    
    
    419,013
    
    
    $
    10.95
    
    
    
    2.4
    
    
    $
    2,451Exercisable at August 31, 2008
    
    
    400,588
    
    
    $
    10.70
    
    
    
    2.2
    
    
    $
    2,446
 
 (a)
    
    Value is calculated on the basis of the difference between the market value of the Companys
Common Stock as reported on the New York Stock Exchange on August 31, 2008 ($16.51) and the
weighted average exercise price, multiplied by the number of shares indicated.  Three months ended
    
    Six months endedAugust 31,
    
    August 31,2008
    
    2007
    
    2008
    
    2007Total cash received
    
    $
    105
    
    
    $
    655
    
    
    $
    105
    
    
    $
    658Income tax benefits
    
    
    
    
    
    
    337
    
    
    
    
    
    
    
    337Total grant-date fair value
    
    
    13
    
    
    
    81
    
    
    
    13
    
    
    
    81Intrinsic value
    
    
    
    
    
    
    601
    
    
    
    
    
    
    
    605
  WeightedAverageNumber
    
    Grant Dateof Options
    
    Fair ValueUnvested at February 29, 2008
    
    
    45,600
    
    
    $
    2.64New grants
    
    
    
    
    
    
    Vested
    
    
    (23,425
    )
    
    
    2.44Forfeited
    
    
    (3,750
    )
    
    
    2.84Unvested at August 31, 2008
    
    
    18,425
    
    
    
    2.85
  16




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 12. Stock Option Plans and Stock Based Compensation-continued
  WeightedAverageNumber of
    
    Grant DateShares
    
    Fair ValueOutstanding at February 29, 2008
    
    
    73,916
    
    
    $
    25.12Granted
    
    
    75,080
    
    
    
    15.67Terminated
    
    
    (2,002
    )
    
    
    22.85Exercised
    
    
    (23,524
    )
    
    
    25.37Outstanding at August 31, 2008
    
    
    123,470
    
    
    $
    19.36Exercisable at August 31, 2008
    
    
    
    
    
    $
    
  13. Employee Benefit Plans
   Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Components of net periodic benefit costService cost
    
    $
    335
    
    
    $
    357
    
    
    $
    670
    
    
    $
    715Interest cost
    
    
    657
    
    
    
    627
    
    
    
    1,313
    
    
    
    1,253Expected return on plan assets
    
    
    (812
    )
    
    
    (770
    )
    
    
    (1,624
    )
    
    
    (1,540
    )Amortization of:Prior service cost
    
    
    (36
    )
    
    
    (36
    )
    
    
    (72
    )
    
    
    (72
    )Unrecognized net loss
    
    
    191
    
    
    
    226
    
    
    
    383
    
    
    
    452Net periodic benefit cost
    
    $
    335
    
    
    $
    404
    
    
    $
    670
    
    
    $
    808
  17




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 14. Earnings per share
   Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Basic weighted average common shares outstanding
    
    
    25,684,769
    
    
    
    25,601,683
    
    
    
    25,676,521
    
    
    
    25,593,522Effect of dilutive options
    
    
    120,494
    
    
    
    253,473
    
    
    
    121,724
    
    
    
    263,543Diluted weighted average common shares
outstanding
    
    
    25,805,263
    
    
    
    25,855,156
    
    
    
    25,798,245
    
    
    
    25,857,065Per share amounts:Net earnings  basic
    
    $
    0.36
    
    
    $
    0.44
    
    
    $
    0.79
    
    
    $
    0.86Net earnings  diluted
    
    $
    0.36
    
    
    $
    0.43
    
    
    $
    0.79
    
    
    $
    0.85Cash dividends
    
    $
    0.155
    
    
    $
    0.155
    
    
    $
    0.310
    
    
    $
    0.310
 15. Segment Information and Geographic Information
   ® TM
  18




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 15. Segment Information and Geographic Information-continued
    Print
    
    Apparel
    
    
    
    
    
    ConsolidatedSegment
    
    Segment
    
    Corporate
    
    TotalsThree months ended August 31, 2008:Net sales
    
    $
    85,395
    
    
    $
    75,655
    
    
    $
    
    
    
    $
    161,050Depreciation
    
    
    1,542
    
    
    
    695
    
    
    
    239
    
    
    
    2,476Amortization of identifiable
intangibles
    
    
    238
    
    
    
    367
    
    
    
    
    
    
    
    605Segment earnings (loss) before
income tax
    
    
    14,375
    
    
    
    4,638
    
    
    
    (4,304
    )
    
    
    14,709Segment assets
    
    
    159,510
    
    
    
    341,912
    
    
    
    13,113
    
    
    
    514,535Capital expenditures
    
    
    1,111
    
    
    
    188
    
    
    
    50
    
    
    
    1,349Three months ended August 31, 2007:Net sales
    
    $
    83,563
    
    
    $
    66,523
    
    
    $
    
    
    
    $
    150,086Depreciation
    
    
    2,025
    
    
    
    880
    
    
    
    224
    
    
    
    3,129Amortization of identifiable
intangibles
    
    
    96
    
    
    
    367
    
    
    
    
    
    
    
    463Segment earnings (loss) before
income tax
    
    
    13,959
    
    
    
    7,589
    
    
    
    (3,868
    )
    
    
    17,680Segment assets
    
    
    147,170
    
    
    
    330,161
    
    
    
    10,838
    
    
    
    488,169Capital expenditures
    
    
    321
    
    
    
    417
    
    
    
    21
    
    
    
    759Six months ended August 31, 2008:Net sales
    
    $
    170,692
    
    
    $
    153,558
    
    
    $
    
    
    
    $
    324,250Depreciation
    
    
    3,364
    
    
    
    1,325
    
    
    
    470
    
    
    
    5,159Amortization of identifiable
intangibles
    
    
    476
    
    
    
    734
    
    
    
    
    
    
    
    1,210Segment earnings (loss) before
income tax
    
    
    28,822
    
    
    
    11,431
    
    
    
    (8,321
    )
    
    
    31,932Segment assets
    
    
    159,510
    
    
    
    341,912
    
    
    
    13,113
    
    
    
    514,535Capital expenditures
    
    
    2,945
    
    
    
    200
    
    
    
    69
    
    
    
    3,214Six months ended August 31, 2007:Net sales
    
    $
    168,698
    
    
    $
    134,162
    
    
    $
    
    
    
    $
    302,860Depreciation
    
    
    4,094
    
    
    
    1,888
    
    
    
    448
    
    
    
    6,430Amortization of identifiable
intangibles
    
    
    195
    
    
    
    734
    
    
    
    
    
    
    
    929Segment earnings (loss) before
income tax
    
    
    26,996
    
    
    
    15,974
    
    
    
    (8,153
    )
    
    
    34,817Segment assets
    
    
    147,170
    
    
    
    330,161
    
    
    
    10,838
    
    
    
    488,169Capital expenditures
    
    
    923
    
    
    
    826
    
    
    
    28
    
    
    
    1,777
 19




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 15. Segment Information and Geographic Information-continued
  United States
    
    
    Canada
    
    
    Mexico
    
    
    TotalThree months ended August 31, 2008:Net sales to unaffiliated customersPrint Segment
    
    $
    85,395
    
    
    $
    
    
    
    $
    
    
    
    $
    85,395Apparel Segment
    
    
    71,388
    
    
    
    4,145
    
    
    
    122
    
    
    
    75,655$
    156,783
    
    
    $
    4,145
    
    
    $
    122
    
    
    $
    161,050Identifiable long-lived assets at August
31, 2008Print Segment
    
    $
    42,290
    
    
    $
    
    
    
    $
    
    
    
    $
    42,290Apparel Segment
    
    
    6,786
    
    
    
    54
    
    
    
    1,994
    
    
    
    8,834Corporate
    
    
    5,778
    
    
    
    
    
    
    
    
    
    
    
    5,778$
    54,854
    
    
    $
    54
    
    
    $
    1,994
    
    
    $
    56,902Three months ended August 31, 2007:Net sales to unaffiliated customersPrint Segment
    
    $
    83,563
    
    
    $
    
    
    
    $
    
    
    
    $
    83,563Apparel Segment
    
    
    61,777
    
    
    
    4,746
    
    
    
    
    
    
    
    66,523$
    145,340
    
    
    $
    4,746
    
    
    $
    
    
    
    $
    150,086Identifiable long-lived assets at August
31, 2007Print Segment
    
    $
    42,131
    
    
    $
    
    
    
    $
    
    
    
    $
    42,131Apparel Segment
    
    
    8,341
    
    
    
    91
    
    
    
    2,338
    
    
    
    10,770Corporate
    
    
    6,522
    
    
    
    
    
    
    
    
    
    
    
    6,522$
    56,994
    
    
    $
    91
    
    
    $
    2,338
    
    
    $
    59,423Six months ended August 31, 2008:Net sales to unaffiliated customersPrint Segment
    
    $
    170,692
    
    
    $
    
    
    
    $
    
    
    
    $
    170,692Apparel Segment
    
    
    143,988
    
    
    
    9,053
    
    
    
    517
    
    
    
    153,558$
    314,680
    
    
    $
    9,053
    
    
    $
    517
    
    
    $
    324,250Six months ended August 31, 2007:Net sales to unaffiliated customersPrint Segment
    
    $
    168,698
    
    
    $
    
    
    
    $
    
    
    
    $
    168,698Apparel Segment
    
    
    124,794
    
    
    
    9,368
    
    
    
    
    
    
    
    134,162$
    293,492
    
    
    $
    9,368
    
    
    $
    
    
    
    $
    302,860
 16. Supplemental Cash Flow Information
  Three months ended
    
    Six months endedAugust 31,
    
    August 31,
    
    August 31,
    
    August 31,2008
    
    2007
    
    2008
    
    2007Interest paid
    
    $
    956
    
    
    $
    1,392
    
    
    $
    2,234
    
    
    $
    2,986Income taxes paid
    
    $
    11,623
    
    
    $
    12,414
    
    
    $
    13,464
    
    
    $
    13,729
 20




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED AUGUST 31, 2008
 17. Assets Held for Sale
  18. Subsequent Events
  21




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 
 Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Overview
    Business Segment Overview
  Print Segment
  TM TM
 22




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 TM TM
       Apparel Segment
    23




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
         Risk Factors
  24




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 We may be required to write down goodwill and other intangible assets in the future, which could
cause our financial condition and results of operations to be negatively affected in the future.
 .
 Printed business forms may be superceded over time by paperless business forms or otherwise
affected by technological obsolescence and changing customer preferences, which could reduce our
sales and profits.
  Our distributors face increased competition from various sources, such as office supply
superstores. Increased competition may require us to reduce prices or to offer other incentives in
order to enable our distributors to attract new customers and retain existing customers.
  Technological improvements may reduce our competitive advantage over some of our competitors, which
could reduce our profits.
  25




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 We could experience labor disputes that could disrupt our business in the future.
  We obtain our raw materials from a limited number of suppliers and any disruption in our
relationships with these suppliers, or any substantial increase in the price of raw materials,
material shortages, or an increase in transportation costs, could have a material adverse effect on
us.
      Alstyle faces intense competition to gain market share, which may lead some competitors to sell
substantial amounts of goods at prices against which we cannot profitably compete.
  The apparel industry is heavily influenced by general economic cycles.
  26




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
  Our apparel foreign operations could be subject to unexpected changes in regulatory requirements,
tariffs and other market barriers and political and economic instability in the countries where it
operates, which could negatively impact our operating results.
  Our apparel products are subject to foreign competition, which in the past have been faced with
significant U.S. government import restrictions.
      27




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
  Environmental regulations may impact our future operating results.
  Our planned expansion of facilities is subject to multiple approvals and uncertainties that could
affect our ability to complete the project on schedule or at budgeted cost.
  We are exposed to the risk of financial non-performance by our customers on a significant amount of
our sales.
  Our business incurs significant freight and transportation costs.
  The price of energy is prone to significant fluctuations and volatility.
  28




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
  We rely on independent contract production for a portion of our apparel production.
  We depend upon the talents and contributions of a limited number of individuals, many of whom would
be difficult to replace.
  Cautionary Statements
   29




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ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 Result of Operations
 Three Months Ended August 31,
    
    
    Six Months Ended August 31,2008
    
    
    2007
    
    
    2008
    
    
    2007Net sales
    
    $
    161,050
    
    
    
    100.0
    %
    
    $
    150,086
    
    
    
    100.0
    %
    
    $
    324,250
    
    
    
    100.0
    %
    
    $
    302,860
    
    
    
    100.0
    %Cost of goods sold
    
    
    121,812
    
    
    
    75.6
    
    
    
    108,747
    
    
    
    72.5
    
    
    
    244,560
    
    
    
    75.4
    
    
    
    220,163
    
    
    
    72.7Gross profit
    
    
    39,238
    
    
    
    24.4
    
    
    
    41,339
    
    
    
    27.5
    
    
    
    79,690
    
    
    
    24.6
    
    
    
    82,697
    
    
    
    27.3Selling, general and
administrative
    
    
    23,738
    
    
    
    14.7
    
    
    
    22,264
    
    
    
    14.8
    
    
    
    45,927
    
    
    
    14.2
    
    
    
    44,900
    
    
    
    14.8(Gain) Loss from disposal
of assets
    
    
    (213
    )
    
    
    0.0
    
    
    
    (1
    )
    
    
    0.0
    
    
    
    (267
    )
    
    
    (0.1
    )
    
    
    11
    
    
    
    0.0Income from operations
    
    
    15,713
    
    
    
    9.7
    
    
    
    19,076
    
    
    
    12.7
    
    
    
    34,030
    
    
    
    10.5
    
    
    
    37,786
    
    
    
    12.5Other income (expense)
    
    
    (1,004
    )
    
    
    (0.6
    )
    
    
    (1,396
    )
    
    
    (0.9
    )
    
    
    (2,098
    )
    
    
    (0.6
    )
    
    
    (2,969
    )
    
    
    (1.0
    )Earnings before income taxes
    
    
    14,709
    
    
    
    9.1
    
    
    
    17,680
    
    
    
    11.8
    
    
    
    31,932
    
    
    
    9.9
    
    
    
    34,817
    
    
    
    11.5Provision for income taxes
    
    
    5,368
    
    
    
    3.3
    
    
    
    6,542
    
    
    
    4.4
    
    
    
    11,655
    
    
    
    3.6
    
    
    
    12,883
    
    
    
    4.3Net earnings
    
    $
    9,341
    
    
    
    5.8
    %
    
    $
    11,138
    
    
    
    7.4
    %
    
    $
    20,277
    
    
    
    6.3
    %
    
    $
    21,934
    
    
    
    7.2
    %
 Critical Accounting Policies and Judgments
      30




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ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
       31




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ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 Results of Operations  Consolidated
 Three Months ended August 31, 2008 compared to Three Months ended August 31, 2007
 Net Sales.
 Gross profit.
 Selling, general and administrative expense.
 Gain from disposal of assets.
 Income from operations.
 Other income and expense.
 Earnings before income taxes.
 Provision for income taxes.
 Net earnings.
 32




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
  Six Months ended August 31, 2008 compared to Six Months ended August 31, 2007.
 Net Sales.
 Gross profit.
 Selling, general and administrative expense.
 Gain from disposal of assets.
 Income from operations. O
 Other income and expense.
 Earnings before income taxes.
 Provision for income taxes.
 Net earnings.
 33




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
  Results of Operations  Segments
 Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,Net Sales by Segment (in thousands)
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Print
    
    $
    85,395
    
    
    $
    83,563
    
    
    $
    170,692
    
    
    $
    168,698Apparel
    
    
    75,655
    
    
    
    66,523
    
    
    
    153,558
    
    
    
    134,162Total
    
    $
    161,050
    
    
    $
    150,086
    
    
    $
    324,250
    
    
    $
    302,860
 Print Segment
 Apparel Segment
 Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,Gross Profit by Segment (in thousands)
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Print
    
    $
    22,274
    
    
    $
    23,264
    
    
    $
    46,006
    
    
    $
    45,793Apparel
    
    
    16,964
    
    
    
    18,075
    
    
    
    33,684
    
    
    
    36,904Total
    
    $
    39,238
    
    
    $
    41,339
    
    
    $
    79,690
    
    
    $
    82,697
 Print Segment
 Apparel Segment
 34




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
  Three months ended
    
    
    Six months endedAugust 31,
    
    
    August 31,Profit by Segment (in thousands)
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Print
    
    $
    14,375
    
    
    $
    13,959
    
    
    $
    28,822
    
    
    $
    26,996Apparel
    
    
    4,638
    
    
    
    7,589
    
    
    
    11,431
    
    
    
    15,974Total
    
    
    19,013
    
    
    
    21,548
    
    
    
    40,253
    
    
    
    42,970Less corporate expenses
    
    
    4,304
    
    
    
    3,868
    
    
    
    8,321
    
    
    
    8,153Earnings before income taxes
    
    $
    14,709
    
    
    $
    17,680
    
    
    $
    31,932
    
    
    $
    34,817
 Print Segment
 Apparel Segment
 Liquidity and Capital Resources
 August 31,
    
    February 29,(Dollars in thousands)
    
    2008
    
    2008
    
    ChangeWorking Capital
    
    $
    135,936
    
    
    $
    133,993
    
    
    
    1.5
    %Cash and cash equivalents
    
    $
    10,164
    
    
    $
    3,393
    
    
    
    199.6
    %
 Working Capital.
 Cash and cash equivalent.
 35




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 Six months ended August 31,(Dollars in thousands)
    
    2008
    
    2007
    
    ChangeNet Cash provided by operating activities
    
    $
    31,017
    
    
    $
    17,489
    
    
    
    77.4
    %Net Cash used in investing activities
    
    $
    (2,604
    )
    
    $
    (1,750
    )
    
    
    48.8
    %Net Cash used in financing activities
    
    $
    (22,024
    )
    
    $
    (15,844
    )
    
    
    39.0
    %
 Cash flows from operating activities.
 Cash flows from investing activities.
 Cash flows from financing activities.
 Credit Facility 
     36




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 Pension 
 Inventories 
 Capital Expenditures 
  Contractual Obligations & Off-Balance Sheet Arrangements 
 Recent Accounting Pronouncements
 FAS 141R.
 FAS 161.
 FSP FAS 142-3.
 37




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 FAS 162. The Meaning of Present Fairly in Conformity with
Generally Accepted Accounting Principles
 FSP EITF 03-6-1
 
 Item 3.
    
    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Market Risk
 Interest Rates
  Foreign Exchange
   38




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 
 Item 4.
    
    CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures.
  
 PART II. OTHER INFORMATION
 
 Item 1.  Legal Proceedings
  
 Item 1A.
    
    Risk Factors
  
 Items 2, 3 and 5 are not applicable and have been omitted
 
 Item 4.
    
    Submission of Matters to a Vote of Security Holders
 (a)
    
    The Company held its Annual Meeting of Shareholders on June 26, 2008.
 (b)
    
    Proxies for the meeting were solicited pursuant to Regulation 14A; there was no
solicitation in opposition to managements nominees for directs listed in the Proxy
Statement and all such nominees were elected. There were no abstentions or broker
non-votes.
  Nominees for Director
    
    Vote Cast for
    
    Votes WithheldFrank D. Bracken
    
    
    22,891,459
    
    
    
    236,175Michael D. Magill
    
    
    22,905,670
    
    
    
    221,964Keith S. Walters
    
    
    22,892,965
    
    
    
    234,669
 39




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 (c)
    
    Briefly described below are the other matters voted upon at the Annual Meeting and the
number of affirmative votes and negative votes respectively.
  For
    
    
    16,469,537Against
    
    
    3,693,702Abstain
    
    
    65,103
  For
    
    
    23,034,362Against
    
    
    39,393Abstain
    
    
    53,879
 
 Item 6.
    
    Exhibits
  Exhibit 3.1(a)
    
    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.Exhibit 3.1(b)
    
    Amendment to Articles of Incorporation dated June 17, 2004 incorporated herein
by reference to Exhibit 3.1(b) to the Registrants Form 10-K Annual Report for
the fiscal year ended February 28, 2007.Exhibit 3.2(a)
    
    Bylaws of the Registrant as amended through October 15, 1997 incorporated
herein by reference to Exhibit 3(ii) to the registrants Form 10-Q Quarterly
Report for the quarter ended November 30, 1997.Exhibit 3.2(b)
    
    First amendment to Bylaws of the Registrant dated December 20, 2007
incorporated herein by reference to Exhibit 3.1 to the Registrants Form 8-K
Current Report filed on December 20, 2007.Exhibit 10
    
    Employment Agreement between the Company and Irshad Ahmad, Corporate Vice
President of Technology dated June 12, 2007.*Exhibit 31.1
    
    Certification Pursuant to Rule 13a-14(a)/15d-14(a) of Chief Executive Officer.*Exhibit 31.2
    
    Certification Pursuant to Rule 13a-14(a)/15d-14(a) of Chief Financial Officer.*Exhibit 32.1
    
    Section 1350 Certification of Chief Executive Officer.**Exhibit 32.2
    
    Section 1350 Certification of Chief Financial Officer.**
 
 *
    
    Filed herewith**
    
    Furnished herewith 40




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##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED AUGUST 31, 2008
 
   ENNIS, INC.Date: September 30, 2008
    /s/ Keith S. WaltersKeith S. WaltersChairman, Chief Executive Officer and
PresidentDate: September 30, 2008
    /s/ Richard L. Travis, Jr.Richard L. Travis, Jr.V.P.  Finance and CFO, Secretary and
Principal Financial and Accounting Officer 41




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##### Table of Contents



INDEX TO EXHIBITS
 Exhibit Number
    
    DescriptionExhibit 3.1(a)
    
    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.Exhibit 3.1(b)
    
    Amendment to Articles of Incorporation dated June 17, 2004 incorporated herein
by reference to Exhibit 3.1(b) to the Registrants Form 10-K Annual Report for
the fiscal year ended February 28, 2007.Exhibit 3.2(a)
    
    Bylaws of the Registrant as amended through October 15, 1997 incorporated
herein by reference to Exhibit 3(ii) to the registrants Form 10-Q Quarterly
Report for the quarter ended November 30, 1997.Exhibit 3.2(b)
    
    First amendment to Bylaws of the Registrant dated December 20, 2007
incorporated herein by reference to Exhibit 3.1 to the Registrants Form 8-K
Current Report filed on December 20, 2007.Exhibit 10
    
    Employment Agreement between the Company and Irshad Ahmad, Corporate Vice
President of Technology dated June 12, 2007.*Exhibit 31.1
    
    Certification Pursuant to Rule 13a-14(a)/15d-14(a) of Chief Executive Officer.*Exhibit 31.2
    
    Certification Pursuant to Rule 13a-14(a)/15d-14(a) of Chief Financial Officer.*Exhibit 32.1
    
    Section 1350 Certification of Chief Executive Officer.**Exhibit 32.2
    
    Section 1350 Certification of Chief Financial Officer.**
 
 *
    
    Filed herewith**
    
    Furnished herewith