##### 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 November 30, 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
    
    (I.R.S. Employer Identification No.)Incorporation or Organization)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
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ




---



##### 



ENNIS, INC. AND SUBSIDIARIES
FORM 10-Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 TABLE OF CONTENTS
 PART I: FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    3Consolidated Balance Sheets at November 30, 2008 (unaudited) and February 29, 2008
    
    
    3Unaudited Consolidated Statements of Earnings for the three and nine months ended November 30, 2008 and 2007
    
    
    5Unaudited Consolidated Statements of Cash Flows for the nine months ended November 30, 2008 and 2007
    
    
    6Notes to the Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    23Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    41Item 4. Controls and Procedures
    
    
    41PART II: OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    42Item 1A. Risk Factors
    
    
    42Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    42Item 3. Defaults Upon Senior Securities
    
    
    42Item 4. Submission of Matters to a Vote of Security Holders
    
    
    42Item 5. Other Information
    
    
    42Item 6. Exhibits
    
    
    42SIGNATURES
    
    
    43EX-31.1EX-31.2EX-32.1EX-32.2
  2




---



##### Table of Contents



PART I. FINANCIAL INFORMATION
 
 Item 1. FINANCIAL STATEMENTS
 ENNIS, INC. AND SUBSIDIARIES
 
 CONSOLIDATED BALANCE SHEETS
 (Dollars in thousands )
 November 30,
    
    
    February 29,2008
    
    
    2008(unaudited)AssetsCurrent assetsCash and cash equivalents
    
    $
    2,972
    
    
    $
    3,393Accounts receivable, net of allowance for doubtful receivables
of $5,202 at November 30, 2008 and $3,954 at February 29, 2008
    
    
    67,679
    
    
    
    72,278Prepaid expenses
    
    
    4,074
    
    
    
    3,500Prepaid income taxes
    
    
    2,235
    
    
    
    Inventories
    
    
    104,028
    
    
    
    98,570Deferred income taxes
    
    
    7,786
    
    
    
    7,786Assets held for sale
    
    
    
    
    
    
    292Total current assets
    
    
    188,774
    
    
    
    185,819Property, plant and equipment, at costPlant, machinery and equipment
    
    
    131,557
    
    
    
    130,214Land and buildings
    
    
    42,951
    
    
    
    42,793Other
    
    
    22,636
    
    
    
    22,586Total property, plant and equipment
    
    
    197,144
    
    
    
    195,593Less accumulated depreciation
    
    
    142,287
    
    
    
    136,605Net property, plant and equipment
    
    
    54,857
    
    
    
    58,988Goodwill
    
    
    178,388
    
    
    
    178,388Trademarks and tradenames, net
    
    
    63,768
    
    
    
    63,880Customer lists, net
    
    
    22,570
    
    
    
    24,260Deferred finance charges, net
    
    
    598
    
    
    
    934Prepaid pension asset
    
    
    
    
    
    
    260Other assets
    
    
    535
    
    
    
    602Total assets
    
    $
    509,490
    
    
    $
    513,131
 See accompanying notes to consolidated financial statements.
 3




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
 CONSOLIDATED BALANCE SHEETS
 (Dollars in thousands, except for share amounts )
 November 30,
    
    
    February 29,2008
    
    
    2008(unaudited)Liabilities and Shareholders EquityCurrent liabilitiesAccounts payable
    
    $
    29,237
    
    
    $
    29,658Accrued expensesEmployee compensation and benefits
    
    
    16,217
    
    
    
    14,840Taxes other than income
    
    
    1,734
    
    
    
    989Federal and state income taxes payable
    
    
    
    
    
    
    501Other
    
    
    6,027
    
    
    
    5,583Current installments of long-term debt
    
    
    227
    
    
    
    255Total current liabilities
    
    
    53,442
    
    
    
    51,826Long-term debt, less current installments
    
    
    70,859
    
    
    
    90,710Liability for pension benefits
    
    
    746
    
    
    
    Deferred income taxes
    
    
    19,246
    
    
    
    20,775Other liabilities
    
    
    124
    
    
    
    1,341Total liabilities
    
    
    144,417
    
    
    
    164,652Commitments and contingenciesShareholders equityPreferred stock $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 November 30 and
February 29, 2008
    
    
    75,134
    
    
    
    75,134Additional paid in capital
    
    
    121,919
    
    
    
    122,566Retained earnings
    
    
    253,785
    
    
    
    235,624Accumulated other comprehensive income (loss):Foreign currency translation
    
    
    (689
    )
    
    
    929Unrealized gain (loss) on derivative instruments
    
    
    (1,155
    )
    
    
    Minimum pension liability
    
    
    (6,450
    )
    
    
    (6,450
    )(8,294
    )
    
    
    (5,521
    )442,544
    
    
    
    427,803Treasury stockCost of 4,292,002 shares at November 30, 2008 and
4,391,193 shares at February 29, 2008
    
    
    (77,471
    )
    
    
    (79,324
    )Total shareholders equity
    
    
    365,073
    
    
    
    348,479Total liabilities and shareholders equity
    
    $
    509,490
    
    
    $
    513,131
 See accompanying notes to consolidated financial statements.
 4




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF EARNINGS
 ( Dollars in thousands except per share amounts )
 (Unaudited)
 Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Net sales
    
    $
    142,453
    
    
    $
    158,215
    
    
    $
    466,703
    
    
    $
    461,075Cost of goods sold
    
    
    104,596
    
    
    
    116,181
    
    
    
    349,156
    
    
    
    336,344Gross profit
    
    
    37,857
    
    
    
    42,034
    
    
    
    117,547
    
    
    
    124,731Selling, general and administrative
    
    
    21,933
    
    
    
    22,490
    
    
    
    67,860
    
    
    
    67,390Gain from disposal of assets
    
    
    (71
    )
    
    
    (343
    )
    
    
    (338
    )
    
    
    (332
    )Income from operations
    
    
    15,995
    
    
    
    19,887
    
    
    
    50,025
    
    
    
    57,673Other income (expense)Interest expense
    
    
    (778
    )
    
    
    (1,398
    )
    
    
    (2,703
    )
    
    
    (4,283
    )Other, net
    
    
    337
    
    
    
    (129
    )
    
    
    164
    
    
    
    (213
    )(441
    )
    
    
    (1,527
    )
    
    
    (2,539
    )
    
    
    (4,496
    )Earnings before income taxes
    
    
    15,554
    
    
    
    18,360
    
    
    
    47,486
    
    
    
    53,177Provision for income taxes
    
    
    5,678
    
    
    
    6,792
    
    
    
    17,333
    
    
    
    19,675Net earnings
    
    $
    9,876
    
    
    $
    11,568
    
    
    $
    30,153
    
    
    $
    33,502Weighted average common shares outstandingBasic
    
    
    25,742,532
    
    
    
    25,653,030
    
    
    
    25,698,286
    
    
    
    25,613,143Diluted
    
    
    25,808,497
    
    
    
    25,887,798
    
    
    
    25,790,031
    
    
    
    25,867,564Per share amountsNet earnings  basic
    
    $
    0.38
    
    
    $
    0.45
    
    
    $
    1.17
    
    
    $
    1.31Net earnings  diluted
    
    $
    0.38
    
    
    $
    0.45
    
    
    $
    1.17
    
    
    $
    1.30Cash dividends per share
    
    $
    0.155
    
    
    $
    0.155
    
    
    $
    0.465
    
    
    $
    0.465
 See accompanying notes to consolidated financial statements.
 5




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Dollars in thousands)
 (Unaudited)
 Nine months endedNovember 30,2008
    
    
    2007Cash flows from operating activities:Net earnings
    
    $
    30,153
    
    
    $
    33,502Adjustments to reconcile net earnings to net cash provided
by operating activities:Depreciation
    
    
    7,567
    
    
    
    9,402Amortization of deferred finance charges
    
    
    335
    
    
    
    336Amortization of trademarks and customer lists
    
    
    1,814
    
    
    
    1,488Gain from disposal of assets
    
    
    (338
    )
    
    
    (332
    )Bad debt expense
    
    
    2,819
    
    
    
    1,431Stock based compensation
    
    
    742
    
    
    
    527Excess tax benefit of stock based compensation
    
    
    (105
    )
    
    
    (337
    )Changes in operating assets and liabilities:Accounts receivable
    
    
    1,179
    
    
    
    (20,842
    )Prepaid expenses
    
    
    (2,953
    )
    
    
    1,542Inventories
    
    
    (6,496
    )
    
    
    (13,442
    )Other assets
    
    
    56
    
    
    
    (5
    )Accounts payable and accrued expenses
    
    
    1,640
    
    
    
    4,729Other liabilities
    
    
    (1,216
    )
    
    
    (1,596
    )Prepaid pension asset/liability for pension benefits
    
    
    1,006
    
    
    
    1,212Net cash provided by operating activities
    
    
    36,203
    
    
    
    17,615Cash flows from investing activities:Capital expenditures
    
    
    (4,005
    )
    
    
    (2,471
    )Purchase of businesses, net of cash acquired
    
    
    
    
    
    
    (14,543
    )Proceeds from disposal of plant and property
    
    
    868
    
    
    
    771Net cash used in investing activities
    
    
    (3,137
    )
    
    
    (16,243
    )Cash flows from financing activities:Borrowings on debt
    
    
    
    
    
    
    18,000Repayment of debt
    
    
    (21,699
    )
    
    
    (10,053
    )Dividends
    
    
    (11,992
    )
    
    
    (11,929
    )Proceeds from exercise of stock options
    
    
    630
    
    
    
    658Excess tax benefit of stock based compensation
    
    
    105
    
    
    
    337Net cash used in financing activities
    
    
    (32,956
    )
    
    
    (2,987
    )Effect of exchange rate changes on cash
    
    
    (531
    )
    
    
    189Net change in cash and cash equivalents
    
    
    (421
    )
    
    
    (1,426
    )Cash and cash equivalents at beginning of period
    
    
    3,393
    
    
    
    3,582Cash and cash equivalents at end of period
    
    $
    2,972
    
    
    $
    2,156
 See accompanying notes to consolidated financial statements.
 6




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 FOR THE PERIOD ENDED NOVEMBER 30, 2008
 1. Significant Accounting Policies and General Matters
 Basis of Presentation
  Reclassifications
  Three Months Ended November 30, 2007Distribution
    
    (Gain) Loss
    
    OtherAs Previously
    
    Warehousing
    
    From Disposal
    
    AdministrativeReported
    
    Expense
    
    of assets
    
    Expense
    
    ReclassifiedCost of goods sold
    
    $
    118,971
    
    
    $
    (2,790
    )
    
    $
    
    
    
    $
    
    
    
    $
    116,181Selling, general and
administrative
    
    
    19,323
    
    
    
    2,790
    
    
    
    
    
    
    
    377
    
    
    
    22,490(Gain) loss from disposal
of assets
    
    
    
    
    
    
    
    
    
    
    (343
    )
    
    
    
    
    
    
    (343
    )Other income (expense), net
    
    
    (163
    )
    
    
    
    
    
    
    (343
    )
    
    
    377
    
    
    
    (129
    )Nine Months Ended November 30, 2007Distribution
    
    (Gain) Loss
    
    OtherAs Previously
    
    Warehousing
    
    From Disposal
    
    AdministrativeReported
    
    Expense
    
    of assets
    
    Expense
    
    ReclassifiedCost of goods sold
    
    $
    344,644
    
    
    $
    (8,300
    )
    
    $
    
    
    
    $
    
    
    
    $
    336,344Selling, general and
administrative
    
    
    57,054
    
    
    
    8,300
    
    
    
    
    
    
    
    2,036
    
    
    
    67,390(Gain) loss from disposal
of assets
    
    
    
    
    
    
    
    
    
    
    (332
    )
    
    
    
    
    
    
    (332
    )Other income (expense), net
    
    
    (1,917
    )
    
    
    
    
    
    
    (332
    )
    
    
    2,036
    
    
    
    (213
    )
 7




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 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




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 1. Significant Accounting Policies and General Matters-continued
 FSP FAS 133-1 and FIN 45-4.
 FSP FAS 157-3.
 2. Due From Factors
     3. Accounts Receivable and Allowance for Doubtful Receivables
   9




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 3. Accounts Receivable and Allowance for Doubtful Receivables-continued
  Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Balance at beginning of period
    
    $
    5,324
    
    
    $
    3,376
    
    
    $
    3,954
    
    
    $
    2,698Bad debt expense
    
    
    790
    
    
    
    535
    
    
    
    2,819
    
    
    
    1,431Recoveries
    
    
    5
    
    
    
    21
    
    
    
    18
    
    
    
    24Accounts written off
    
    
    (917
    )
    
    
    (279
    )
    
    
    (1,589
    )
    
    
    (500
    )Balance at end of period
    
    $
    5,202
    
    
    $
    3,653
    
    
    $
    5,202
    
    
    $
    3,653
 4. Inventories
   November 30,
    
    
    February 29,2008
    
    
    2008Raw material
    
    $
    16,059
    
    
    $
    14,711Work-in-process
    
    
    23,800
    
    
    
    15,467Finished goods
    
    
    64,169
    
    
    
    68,392$
    104,028
    
    
    $
    98,570
 5. Acquisitions
  10




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 5. Acquisitions-continued
  Accounts receivable
    
    $
    2,713Inventories
    
    
    1,711Other assets
    
    
    66Property, plant & equipment
    
    
    2,662Customer lists
    
    
    5,084Trademarks
    
    
    671Noncompete
    
    
    18Accounts payable and accrued liabilities
    
    
    (443
    )$
    12,482
   Accounts receivable
    
    $
    974Inventories
    
    
    346Property, plant & equipment
    
    
    419Customer lists
    
    
    767Trademarks
    
    
    306Noncompete
    
    
    15Accounts payable and accrued liabilities
    
    
    (171
    )$
    2,656
  Three months ended
    
    Nine months endedNovember 30,
    
    November 30,2007
    
    2007Pro forma net sales
    
    $
    161,139
    
    
    $
    482,251Pro forma net earnings
    
    
    11,625
    
    
    
    33,891Pro forma earnings per share  diluted
    
    
    0.45
    
    
    
    1.31
  11




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 6. Goodwill and Other Intangible Assets
    GrossCarrying
    
    
    AccumulatedAmount
    
    
    Amortization
    
    
    NetAs of November 30, 2008Amortized intangible assets (in thousands)Tradenames
    
    $
    1,234
    
    
    $
    704
    
    
    $
    530Customer lists
    
    
    29,908
    
    
    
    7,338
    
    
    
    22,570Noncompete
    
    
    500
    
    
    
    463
    
    
    
    37$
    31,642
    
    
    $
    8,505
    
    
    $
    23,137As 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
 November 30,
    
    
    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
 12




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 6. Goodwill and Other Intangible Assets-continued
  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 November 30, 2008
    
    $
    40,688
    
    
    $
    137,700
    
    
    $
    178,388
  7. Other Accrued Expenses
  November 30, 2008
    
    
    February 29, 2008Accrued interest
    
    $
    191
    
    
    $
    604Accrued taxes
    
    
    362
    
    
    
    405Accrued legal and professional fees
    
    
    463
    
    
    
    244Accrued utilities
    
    
    2,335
    
    
    
    1,358Accrued repairs and maintenance
    
    
    376
    
    
    
    274Accrued contract labor
    
    
    
    
    
    
    280Factored receivables with recourse
    
    
    
    
    
    
    539Other accrued expenses
    
    
    2,300
    
    
    
    1,879$
    6,027
    
    
    $
    5,583
 8. Derivative Instruments and Hedging Activities
    13




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 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.
   Fair Value Measurements UsingQuoted Prices in Active
    
    
    Significant Other
    
    
    SignificantMarkets for Identical
    
    
    Observable
    
    
    UnobservableAssets
    
    
    Input
    
    
    InputsDescription
    
    November 30, 2008
    
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)Derivative asset
    
    $
    
    
    
    $
    
    
    
    
    
    
    
    $
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    Derivative liability
    
    $
    (1,820
    )
    
    $
    
    
    
    $
    (1,820
    )
    
    $
    $
    (1,820
    )
    
    $
    
    
    
    $
    (1,820
    )
    
    $
    
 14




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 10. Long-Term Debt
  November 30, 2008
    
    
    February 29, 2008Revolving credit facility
    
    $
    69,000
    
    
    $
    90,500Capital lease obligations
    
    
    266
    
    
    
    452Other
    
    
    1,820
    
    
    
    1371,086
    
    
    
    90,965Less current installments
    
    
    227
    
    
    
    255Long-term debt
    
    $
    70,859
    
    
    $
    90,710
    11. Shareholders Equity
  Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Net earnings
    
    $
    9,876
    
    
    $
    11,568
    
    
    $
    30,153
    
    
    $
    33,502Foreign currency translation adjustment,
net of deferred taxes
    
    
    (1,414
    )
    
    
    312
    
    
    
    (1,618
    )
    
    
    789Unrealized loss on derivative instruments,
net of deferred taxes
    
    
    (866
    )
    
    
    
    
    
    
    (1,155
    )
    
    
    Comprehensive income
    
    $
    7,596
    
    
    $
    11,880
    
    
    $
    27,380
    
    
    $
    34,291
 15




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 11. Shareholders Equity-continued
  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
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,153
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,153Foreign currency translation,
net of deferred tax of $950
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,618
    )
    
    
    
    
    
    
    
    
    
    
    (1,618
    )Unrealized loss on
derivative instruments, net
of deferred tax of $665
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,155
    )
    
    
    
    
    
    
    
    
    
    
    (1,155
    )Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,380Dividends declared
($0.465 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,992
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,992
    )Excess tax benefit of stock
option exercises and restricted
stock grants
    
    
    
    
    
    
    
    
    
    
    105
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    105Stock based compensation
    
    
    
    
    
    
    
    
    
    
    471
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    471Exercise of stock options
and restricted stock grants
    
    
    
    
    
    
    
    
    
    
    (1,223
    )
    
    
    
    
    
    
    
    
    
    
    99,191
    
    
    
    1,853
    
    
    
    630Balance November 30, 2008
    
    
    30,053,443
    
    
    $
    75,134
    
    
    $
    121,919
    
    
    $
    253,785
    
    
    $
    (8,294
    )
    
    
    (4,292,002
    )
    
    $
    (77,471
    )
    
    $
    365,073
 12. Stock Option Plans and Stock Based Compensation
    16




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 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
    
    
    (45,200
    )
    
    
    12.36Exercised
    
    
    (103,500
    )
    
    
    10.34Outstanding at November 30, 2008
    
    
    320,813
    
    
    $
    10.97
    
    
    
    2.6
    
    
    $
    434Exercisable at November 30, 2008
    
    
    302,388
    
    
    $
    10.65
    
    
    
    2.4
    
    
    $
    434
 
 (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 November 30, 2008 ($10.17) and the
weighted average exercise price, multiplied by the number of shares indicated.  Three months ended
    
    Nine months endedNovember 30,
    
    November 30,2008
    
    2007
    
    2008
    
    2007Total cash received
    
    $
    525
    
    
    $
    
    
    
    $
    630
    
    
    $
    658Income tax benefits
    
    
    105
    
    
    
    
    
    
    
    105
    
    
    
    337Total grant-date fair value
    
    
    120
    
    
    
    
    
    
    
    133
    
    
    
    81Intrinsic value
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    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 November 30, 2008
    
    
    18,425
    
    
    
    2.85
  17




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 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
    
    
    (15,236
    )
    
    
    19.89Exercised
    
    
    (23,524
    )
    
    
    25.37Outstanding at November 30, 2008
    
    
    110,236
    
    
    $
    19.35Exercisable at November 30, 2008
    
    
    
    
    
    $
    
  13. Employee Benefit Plans
   Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Components of net periodic benefit costService cost
    
    $
    337
    
    
    $
    358
    
    
    $
    1,007
    
    
    $
    1,073Interest cost
    
    
    657
    
    
    
    626
    
    
    
    1,970
    
    
    
    1,879Expected return on plan assets
    
    
    (813
    )
    
    
    (769
    )
    
    
    (2,437
    )
    
    
    (2,309
    )Amortization of:Prior service cost
    
    
    (37
    )
    
    
    (37
    )
    
    
    (109
    )
    
    
    (109
    )Unrecognized net loss
    
    
    192
    
    
    
    226
    
    
    
    575
    
    
    
    678Net periodic benefit cost
    
    $
    336
    
    
    $
    404
    
    
    $
    1,006
    
    
    $
    1,212
  18




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 14. Earnings per share
   Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Basic weighted average common shares outstanding
    
    
    25,742,532
    
    
    
    25,653,030
    
    
    
    25,698,286
    
    
    
    25,613,143Effect of dilutive options
    
    
    65,965
    
    
    
    234,768
    
    
    
    91,745
    
    
    
    254,421Diluted weighted average common shares
outstanding
    
    
    25,808,497
    
    
    
    25,887,798
    
    
    
    25,790,031
    
    
    
    25,867,564Per share amounts:Net earnings  basic
    
    $
    0.38
    
    
    $
    0.45
    
    
    $
    1.17
    
    
    $
    1.31Net earnings  diluted
    
    $
    0.38
    
    
    $
    0.45
    
    
    $
    1.17
    
    
    $
    1.30Cash dividends
    
    $
    0.155
    
    
    $
    0.155
    
    
    $
    0.465
    
    
    $
    0.465
 15. Segment Information and Geographic Information
    ® TM TM TM TM ®
  19




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 15. Segment Information and Geographic Information-continued
    Print
    
    Apparel
    
    
    
    
    
    ConsolidatedSegment
    
    Segment
    
    Corporate
    
    TotalsThree months ended November 30, 2008:Net sales
    
    $
    82,577
    
    
    $
    59,876
    
    
    $
    
    
    
    $
    142,453Depreciation
    
    
    1,491
    
    
    
    678
    
    
    
    239
    
    
    
    2,408Amortization
of identifiable intangibles
    
    
    238
    
    
    
    366
    
    
    
    
    
    
    
    604Segment earnings (loss) before
income tax
    
    
    13,382
    
    
    
    6,286
    
    
    
    (4,114
    )
    
    
    15,554Segment assets
    
    
    155,209
    
    
    
    345,704
    
    
    
    8,577
    
    
    
    509,490Capital expenditures
    
    
    638
    
    
    
    137
    
    
    
    16
    
    
    
    791Three months ended November 30, 2007:Net sales
    
    $
    88,734
    
    
    $
    69,481
    
    
    $
    
    
    
    $
    158,215Depreciation
    
    
    1,975
    
    
    
    772
    
    
    
    225
    
    
    
    2,972Amortization of identifiable
intangibles
    
    
    193
    
    
    
    366
    
    
    
    
    
    
    
    559Segment earnings (loss) before
income tax
    
    
    14,172
    
    
    
    8,072
    
    
    
    (3,884
    )
    
    
    18,360Segment assets
    
    
    164,080
    
    
    
    345,649
    
    
    
    6,706
    
    
    
    516,435Capital expenditures
    
    
    533
    
    
    
    156
    
    
    
    5
    
    
    
    694Nine months ended November 30, 2008:Net sales
    
    $
    253,269
    
    
    $
    213,434
    
    
    $
    
    
    
    $
    466,703Depreciation
    
    
    4,855
    
    
    
    2,003
    
    
    
    709
    
    
    
    7,567Amortization of identifiable
intangibles
    
    
    714
    
    
    
    1,100
    
    
    
    
    
    
    
    1,814Segment earnings (loss) before
income tax
    
    
    42,204
    
    
    
    17,717
    
    
    
    (12,435
    )
    
    
    47,486Segment assets
    
    
    155,209
    
    
    
    345,704
    
    
    
    8,577
    
    
    
    509,490Capital expenditures
    
    
    3,583
    
    
    
    337
    
    
    
    85
    
    
    
    4,005Nine months ended November 30, 2007:Net sales
    
    $
    257,432
    
    
    $
    203,643
    
    
    $
    
    
    
    $
    461,075Depreciation
    
    
    6,069
    
    
    
    2,660
    
    
    
    673
    
    
    
    9,402Amortization of identifiable
intangibles
    
    
    388
    
    
    
    1,100
    
    
    
    
    
    
    
    1,488Segment earnings (loss) before
income tax
    
    
    41,168
    
    
    
    24,046
    
    
    
    (12,037
    )
    
    
    53,177Segment assets
    
    
    164,080
    
    
    
    345,649
    
    
    
    6,706
    
    
    
    516,435Capital expenditures
    
    
    1,456
    
    
    
    982
    
    
    
    33
    
    
    
    2,471
 20




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 15. Segment Information and Geographic Information-continued
  United States
    
    
    Canada
    
    
    Mexico
    
    
    TotalThree months ended November 30, 2008:Net sales to unaffiliated customersPrint Segment
    
    $
    82,577
    
    
    $
    
    
    
    $
    
    
    
    $
    82,577Apparel Segment
    
    
    55,572
    
    
    
    3,958
    
    
    
    346
    
    
    
    59,876$
    138,149
    
    
    $
    3,958
    
    
    $
    346
    
    
    $
    142,453Identifiable long-lived assetsPrint Segment
    
    $
    41,434
    
    
    $
    
    
    
    $
    
    
    
    $
    41,434Apparel Segment
    
    
    6,354
    
    
    
    43
    
    
    
    1,472
    
    
    
    7,869Corporate
    
    
    5,554
    
    
    
    
    
    
    
    
    
    
    
    5,554$
    53,342
    
    
    $
    43
    
    
    $
    1,472
    
    
    $
    54,857Three months ended November 30, 2007:Net sales to unaffiliated customersPrint Segment
    
    $
    88,734
    
    
    $
    
    
    
    $
    
    
    
    $
    88,734Apparel Segment
    
    
    65,269
    
    
    
    4,212
    
    
    
    
    
    
    
    69,481$
    154,003
    
    
    $
    4,212
    
    
    $
    
    
    
    $
    158,215Identifiable long-lived assetsPrint Segment
    
    $
    44,510
    
    
    $
    
    
    
    $
    
    
    
    $
    44,510Apparel Segment
    
    
    7,916
    
    
    
    85
    
    
    
    2,187
    
    
    
    10,188Corporate
    
    
    6,301
    
    
    
    
    
    
    
    
    
    
    
    6,301$
    58,727
    
    
    $
    85
    
    
    $
    2,187
    
    
    $
    60,999Nine months ended November 30, 2008:Net sales to unaffiliated customersPrint Segment
    
    $
    253,269
    
    
    $
    
    
    
    $
    
    
    
    $
    253,269Apparel Segment
    
    
    199,560
    
    
    
    13,011
    
    
    
    863
    
    
    
    213,434$
    452,829
    
    
    $
    13,011
    
    
    $
    863
    
    
    $
    466,703Nine months ended November 30, 2007:Net sales to unaffiliated customersPrint Segment
    
    $
    257,432
    
    
    $
    
    
    
    $
    
    
    
    $
    257,432Apparel Segment
    
    
    190,063
    
    
    
    13,580
    
    
    
    
    
    
    
    203,643$
    447,495
    
    
    $
    13,580
    
    
    $
    
    
    
    $
    461,075
 21




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 16. Supplemental Cash Flow Information
  Nine months endedNovember 30,
    
    November 30,2008
    
    2007Interest paid
    
    $
    3,117
    
    
    $
    4,509Income taxes paid
    
    $
    20,701
    
    
    $
    19,854
 17. Assets Held for Sale
  18. Subsequent Events
  22




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 
 Item 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Overview
    Business Segment Overview
  Print Segment
  ® TM TM
 23




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 TM TM ®
       Apparel Segment
 ® ® ® ® ® ®
   24




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
         Risk Factors
  25




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 Our results and financial condition are affected by global and local market conditions, which can
adversely affect our sales, margins, and net income.
  
    
    Our ability to manage upward pressure on commodity prices and the impact of
government actions to manage national economic conditions such as consumer spending,
inflation rates and unemployment levels, particularly given the current volatility in
the global financial markets;
    
    The impact on our margins of labor costs given our labor-intensive business model,
the trend toward higher wages in both mature and developing markets and the potential
impact of union organizing efforts on day-to-day operations of our manufacturing
facilities.
 Declining economic conditions could negatively impact our business.
  The terms and conditions of our credit facility impose certain restrictions on our operations. We
may not be able to raise additional capital, if needed for proposed expansion projects, etc.
 We may be required to write down goodwill and other
intangible assets, which could cause our financial condition and results of operations to be
negatively affected in the future  page 27
  Declining financial market conditions could adversely impact the funding status of our pension
plan.
  26




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
  We may be required to write down goodwill and
other intangible assets, 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.
  27




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 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.
  28




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 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.
      29




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 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.
  30




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 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
   31




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 Result of Operations
 Three Months Ended November 30,
    
    
    Nine Months Ended November 30,2008
    
    
    2007
    
    
    2008
    
    
    2007Net sales
    
    $
    142,453
    
    
    
    100.0
    %
    
    $
    158,215
    
    
    
    100.0
    %
    
    $
    466,703
    
    
    
    100.0
    %
    
    $
    461,075
    
    
    
    100.0
    %Cost of goods sold
    
    
    104,596
    
    
    
    73.4
    
    
    
    116,181
    
    
    
    73.4
    
    
    
    349,156
    
    
    
    74.8
    
    
    
    336,344
    
    
    
    72.9Gross profit
    
    
    37,857
    
    
    
    26.6
    
    
    
    42,034
    
    
    
    26.6
    
    
    
    117,547
    
    
    
    25.2
    
    
    
    124,731
    
    
    
    27.1Selling, general and administrative
    
    
    21,933
    
    
    
    15.4
    
    
    
    22,490
    
    
    
    14.2
    
    
    
    67,860
    
    
    
    14.5
    
    
    
    67,390
    
    
    
    14.6Gain from disposal of assets
    
    
    (71
    )
    
    
    0.0
    
    
    
    (343
    )
    
    
    (0.2
    )
    
    
    (338
    )
    
    
    0.0
    
    
    
    (332
    )
    
    
    (0.1
    )Income from operations
    
    
    15,995
    
    
    
    11.2
    
    
    
    19,887
    
    
    
    12.6
    
    
    
    50,025
    
    
    
    10.7
    
    
    
    57,673
    
    
    
    12.6Other income (expense)
    
    
    (441
    )
    
    
    (0.3
    )
    
    
    (1,527
    )
    
    
    (1.0
    )
    
    
    (2,539
    )
    
    
    (0.5
    )
    
    
    (4,496
    )
    
    
    (1.0
    )Earnings before income taxes
    
    
    15,554
    
    
    
    10.9
    
    
    
    18,360
    
    
    
    11.6
    
    
    
    47,486
    
    
    
    10.2
    
    
    
    53,177
    
    
    
    11.6Provision for income taxes
    
    
    5,678
    
    
    
    4.0
    
    
    
    6,792
    
    
    
    4.3
    
    
    
    17,333
    
    
    
    3.7
    
    
    
    19,675
    
    
    
    4.3Net earnings
    
    $
    9,876
    
    
    
    6.9
    %
    
    $
    11,568
    
    
    
    7.3
    %
    
    $
    30,153
    
    
    
    6.5
    %
    
    $
    33,502
    
    
    
    7.3
    %
 Critical Accounting Policies and Judgments
     32




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
        33




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 Results of Operations  Consolidated
 Three Months ended November 30, 2008 compared to Three Months ended November 30, 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.
 34




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 Nine Months ended November 30, 2008 compared to Nine Months ended November 30, 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.
 35




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 Results of Operations  Segments
 Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,Net Sales by Segment (in thousands)
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Print
    
    $
    82,577
    
    
    $
    88,734
    
    
    $
    253,269
    
    
    $
    257,432Apparel
    
    
    59,876
    
    
    
    69,481
    
    
    
    213,434
    
    
    
    203,643Total
    
    $
    142,453
    
    
    $
    158,215
    
    
    $
    466,703
    
    
    $
    461,075
 Print Segment
 Apparel Segment
 Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,Gross Profit by Segment (in thousands)
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Print
    
    $
    21,776
    
    
    $
    23,797
    
    
    $
    67,782
    
    
    $
    69,590Apparel
    
    
    16,081
    
    
    
    18,237
    
    
    
    49,765
    
    
    
    55,141Total
    
    $
    37,857
    
    
    $
    42,034
    
    
    $
    117,547
    
    
    $
    124,731
 Print Segment
 36




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 Apparel Segment
 Three months ended
    
    
    Nine months endedNovember 30,
    
    
    November 30,Profit by Segment (in thousands)
    
    2008
    
    
    2007
    
    
    2008
    
    
    2007Print
    
    $
    13,382
    
    
    $
    14,172
    
    
    $
    42,204
    
    
    $
    41,168Apparel
    
    
    6,286
    
    
    
    8,072
    
    
    
    17,717
    
    
    
    24,046Total
    
    
    19,668
    
    
    
    22,244
    
    
    
    59,921
    
    
    
    65,214Less corporate expenses
    
    
    4,114
    
    
    
    3,884
    
    
    
    12,435
    
    
    
    12,037Earnings before income taxes
    
    $
    15,554
    
    
    $
    18,360
    
    
    $
    47,486
    
    
    $
    53,177
 Print Segment
 Apparel Segment
 Liquidity and Capital Resources
 November 30,
    
    February 29,(Dollars in thousands)
    
    2008
    
    2008
    
    ChangeWorking Capital
    
    $
    135,332
    
    
    $
    133,993
    
    
    
    1.0
    %Cash and cash equivalents
    
    $
    2,972
    
    
    $
    3,393
    
    
    
    -12.4
    %
 Working Capital.
 37




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 Cash and cash equivalent.
 Nine months ended November 30,(Dollars in thousands)
    
    2008
    
    2007
    
    ChangeNet Cash provided by operating activities
    
    $
    36,203
    
    
    $
    17,615
    
    
    
    105.5
    %Net Cash used in investing activities
    
    $
    (3,137
    )
    
    $
    (16,243
    )
    
    
    -80.7
    %Net Cash used in financing activities
    
    $
    (32,956
    )
    
    $
    (2,987
    )
    
    
    1003.3
    %
 Cash flows from operating activities.
 Cash flows from investing activities.
 Cash flows from financing activities.
 Stock Repurchase  
 Credit Facility -
   38




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
   Pension 
 Inventories -
 Capital Expenditures -
  Contractual Obligations & Off-Balance Sheet Arrangements -
 Recent Accounting Pronouncements
 FAS 141R.
 FAS 161.
 39




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
  FSP FAS 142-3.
 FAS 162. The Meaning of Present Fairly in Conformity with
Generally Accepted Accounting Principles"
 FSP EITF 03-6-1
 FSP FAS 133-1 and FIN 45-4.
 FSP FAS 157-3.
 40




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 
 Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Market Risk
 Interest Rates
  Foreign Exchange
   
 Item 4. CONTROLS AND PROCEDURES
 Evaluation of Disclosure Controls and Procedures.
  41




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 
 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
  
 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 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 42




---



##### Table of Contents



ENNIS, INC. AND SUBSIDIARIES
FORM 10Q
FOR THE PERIOD ENDED NOVEMBER 30, 2008
 
   ENNIS, INC.Date: December 24, 2008
    /s/ Keith S. WaltersKeith S. WaltersChairman, Chief Executive Officer and

President Date: December 24, 2008
    /s/ Richard L. Travis, Jr.Richard L. Travis, Jr.V.P.  Finance and CFO, Secretary and

Principal Financial and Accounting Officer 43




---



##### 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 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