**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

**Washington,D.C. 20549**

**FORM 10-Q**

**(Mark One)**

| **x** | **QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE SECURITIES EXCHANGE ACT OF 1934** |
|-------|----------------------------------------------------------------------------------------------|

 

**For the quarterly period ended   December30, 2006**

**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   0-7597**

**COURIERCORPORATION**(Exact name of registrant as specified in its charter)

**Massachusetts**(State or other jurisdiction of incorporation or organization)

**04-2502514**(I.R.S. Employer Identification No.)

| **15 Wellman Avenue, North Chelmsford, Massachusetts** | **01863**  |
|--------------------------------------------------------|------------|
| (Address of  principal executive offices)              | (Zip Code) |

 

**(978)251-6000**(Registrant’s telephone number, including area code)

**NO CHANGE**(Former name, former address and former fiscal year, if changed since lastreport)

Indicate by check markwhether the registrant (1) has filed all reports required to be filed bySection 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding12 months (or for such shorter period that the registrant was required to filesuch reports), and (2) has been subject to such filing requirements for thepast 90 days. 

Yes    x   No    o

Indicate by check markwhether the registrant is a large accelerated filer, an accelerated filer or anon-accelerated filer (as defined in Exchange Act Rule 12b-2).

Large accelerated filer    o   Acceleratedfiler    x   Non-accelerated filer   o

Indicate by check markwhether the registrant is a shell company (as defined in Exchange Act Rule12b-2).

Yes   o   No    x

Indicate the number ofshares outstanding of each of the issuer’s classes of common stock, as of thelatest practicable date.

| **Class**                   |   | **Outstanding at February 7, 2007** |
|-----------------------------|--------|---------------------------------------------------------|
| Common Stock, $1  par value |   | 12,482,751  shares                                      |

 

 

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COURIER CORPORATION

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(Dollars in thousandsexcept per share amounts)
| ** **                           | ** ** | **THREE MONTHS ENDED** | ** ** |
|--------------------------------------|------------|----------------------------------|------------|
| ** **                           | ** ** | **December 30,**            | ** ** | **December 24,** | ** ** |
| ** **                           | ** ** | **2006**                         | ** ** | **2005** | ** ** |
|                                 |       |                             |       |   |   |
| Net sales                            |       | $                                | 64,312     |   | $ | 57,684 |   |
| Cost of sales                        |       | 44,168                           |       | 39,153 |   |
|                                 |       |                             |       |   |   |
| Gross profit                         |       | 20,144                           |       | 18,531 |   |
|                                 |       |                             |       |   |   |
| Selling and  administrative expenses |       | 13,501                           |       | 11,680 |   |
| Interest expense  (income), net      |       | 222                              |       | (148 | ) |
|                                 |       |                             |       |   |   |
| Pretax income                        |       | 6,421                            |       | 6,999 |   |
|                                 |       |                             |       |   |   |
| Provision for income  taxes (Note C) |       | 2,398                            |       | 2,512 |   |
|                                 |       |                             |       |   |   |
| Net income                           |       | $                                | 4,023      |   | $ | 4,487 |   |
|                                 |       |                             |       |   |   |
| Net income per share  (Note D):      |       |                             |       |   |   |
|                                 |       |                             |       |   |   |
| Basic                                |       | $                                | 0.32       |   | $ | 0.37 |   |
|                                 |       |                             |       |   |   |
| Diluted                              |       | $                                | 0.32       |   | $ | 0.36 |   |
|                                 |       |                             |       |   |   |
| Cash dividends declared  per share   |       | $                                | 0.18       |   | $ | 0.12 |   |

 

The accompanying notesare an integral part of the consolidated financial statements.

2

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COURIERCORPORATIONCONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)(Dollars in thousands)
| ** **                                                                                                                       | ** ** | **December 30,** | ** ** | **September 30,** | ** ** |
|----------------------------------------------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| **ASSETS**                                                                                                                       | ** ** | **2006**              | ** ** | **2006**               | ** ** |
|                                                                                                                             |       |                  |       |                   |       |
| Current assets:                                                                                                                  |       |                  |       |                   |       |
| Cash and cash equivalents                                                                                                        |       | $                     | 1,506      |                   | $          | 1,483 |   |
| Accounts receivable, less allowance for  uncollectible accounts of $1,646 at December 30, 2006 and $1,593 at September  30, 2006 |       | 42,337                |       | 46,002                 |       |
| Inventories (Note B)                                                                                                             |       | 33,534                |       | 29,565                 |       |
| Deferred income taxes                                                                                                            |       | 3,701                 |       | 3,703                  |       |
| Other current assets                                                                                                             |       | 936                   |       | 1,110                  |       |
|                                                                                                                             |       |                  |       |                   |       |
| Total current assets                                                                                                             |       | 82,014                |       | 81,863                 |       |
|                                                                                                                             |       |                  |       |                   |       |
| Property, plant  and equipment, less accumulated depreciation: $132,458 at December 30, 2006  and $129,323 at September 30, 2006 |       | 90,007                |       | 85,248                 |       |
|                                                                                                                             |       |                  |       |                   |       |
| Goodwill (Note  A)                                                                                                               |       | 55,406                |       | 55,406                 |       |
|                                                                                                                             |       |                  |       |                   |       |
| Other intangibles,  net (Note A)                                                                                                 |       | 13,490                |       | 13,691                 |       |
|                                                                                                                             |       |                  |       |                   |       |
| Prepublication  costs (Note A)                                                                                                   |       | 9,668                 |       | 9,327                  |       |
|                                                                                                                             |       |                  |       |                   |       |
| Other assets                                                                                                                     |       | 1,679                 |       | 1,653                  |       |
|                                                                                                                             |       |                  |       |                   |       |
| Total assets                                                                                                                     |       | $                     | 252,264    |                   | $          | 247,188 |   |

 

The accompanying notesare an integral part of the consolidated financial statements.

3

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| ** **                                                                                                                               | ** ** | **December 30,** | ** ** | **September 30,** | ** ** |
|------------------------------------------------------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| **LIABILITIES AND STOCKHOLDERS’ EQUITY**                                                                             | ** ** | **2006**              | ** ** | **2006**               | ** ** |
|                                                                                                                                     |       |                  |       |                   |       |
| Current  liabilities:                                                                                                                    |       |                  |       |                   |       |
| Current maturities of long-term debt                                                                                                     |       | $                     | 88         |                   | $          | 88 |   |
| Accounts payable                                                                                                                         |       | 17,650                |       | 15,778                 |       |
| Accrued payroll                                                                                                                          |       | 5,960                 |       | 9,534                  |       |
| Accrued taxes                                                                                                                            |       | 2,312                 |       | 3,362                  |       |
| Other current liabilities                                                                                                                |       | 8,090                 |       | 6,928                  |       |
|                                                                                                                                     |       |                  |       |                   |       |
| Total current liabilities                                                                                                                |       | 34,100                |       | 35,690                 |       |
|                                                                                                                                     |       |                  |       |                   |       |
| Long-term debt                                                                                                                           |       | 20,948                |       | 17,222                 |       |
| Deferred income  taxes                                                                                                                   |       | 9,481                 |       | 8,913                  |       |
| Other  liabilities                                                                                                                       |       | 2,791                 |       | 3,037                  |       |
|                                                                                                                                     |       |                  |       |                   |       |
| Total liabilities                                                                                                                        |       | 67,320                |       | 64,862                 |       |
|                                                                                                                                     |       |                  |       |                   |       |
| Stockholders’  equity (Note F):                                                                                                     |       |                  |       |                   |       |
| Preferred stock, $1 par value - authorized 1,000,000  shares; none issued                                                                |       |                  |       |                   |       |
| Common stock, $1 par value - authorized 18,000,000  shares; issued 12,465,000 at December 30, 2006 and 12,445,000 at September 30,  2006 |       | 12,465                |       | 12,445                 |       |
| Additional paid-in capital                                                                                                               |       | 9,409                 |       | 8,592                  |       |
| Retained earnings                                                                                                                        |       | 163,070               |       | 161,289                |       |
|                                                                                                                                     |       |                  |       |                   |       |
| Total stockholders’ equity                                                                                                          |       | 184,944               |       | 182,326                |       |
|                                                                                                                                     |       |                  |       |                   |       |
| Total  liabilities and stockholders’ equity                                                                                         |       | $                     | 252,264    |                   | $          | 247,188 |   |

 

The accompanying notesare an integral part of the consolidated financial statements.

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COURIER CORPORATION

CONSOLIDATED CONDENSEDSTATEMENTS OF CASH FLOWS (UNAUDITED)

(Dollars inthousands)
| ** **                                                                       | ** ** | **THREE MONTHS ENDED** | ** ** |
|----------------------------------------------------------------------------------|------------|----------------------------------|------------|
| ** **                                                                       | ** ** | **December 30,**            | ** ** | **December 24,** | ** ** |
| ** **                                                                       | ** ** | **2006**                         | ** ** | **2005** | ** ** |
|                                                                             |       |                             |       |   |   |
| Operating Activities:                                                            |       |                             |       |   |   |
| Net income                                                                       |       | $                                | 4,023      |   | $ | 4,487 |   |
| Adjustments to reconcile net income to cash provided  from operating activities: |       |                             |       |   |   |
| Depreciation and amortization                                                    |       | 4,405                            |       | 3,370 |   |
| Stock based compensation                                                         |       | 363                              |       | 336 |   |
| Deferred income taxes                                                            |       | 570                              |       | 159 |   |
| Changes in assets and liabilities:                                               |       |                             |       |   |   |
| Accounts receivable                                                              |       | 3,665                            |       | 2,537 |   |
| Inventory                                                                        |       | (3,969                           | )          | 526 |   |
| Accounts payable                                                                 |       | 1,872                            |       | (2,032 | ) |
| Accrued taxes                                                                    |       | (1,050                           | )          | 915 |   |
| Other elements of working capital                                                |       | (2,238                           | )          | (639 | ) |
| Other, net                                                                       |       | (252                             | )          | 82 |   |
|                                                                             |       |                             |       |   |   |
| Cash provided  from operating activities                                         |       | 7,389                            |       | 9,741 |   |
|                                                                             |       |                             |       |   |   |
| Investment  Activities:                                                          |       |                             |       |   |   |
| Capital expenditures                                                             |       | (7,895                           | )          | (7,408 | ) |
| Business acquisition, net of cash acquired                                       |       | —                           |       | (14,163 | ) |
| Prepublication costs                                                             |       | (1,405                           | )          | (777 | ) |
|                                                                             |       |                             |       |   |   |
| Cash used for  investment activities                                             |       | (9,300                           | )          | (22,348 | ) |
|                                                                             |       |                             |       |   |   |
| Financing  Activities:                                                           |       |                             |       |   |   |
| Long-term debt borrowings (repayments)                                           |       | 3,726                            |       | (21 | ) |
| Cash dividends                                                                   |       | (2,242                           | )          | (1,479 | ) |
| Proceeds from stock plans                                                        |       | 475                              |       | 161 |   |
| Excess tax benefits from stock-based compensation                                |       | (25                              | )          | — |   |
|                                                                             |       |                             |       |   |   |
| Cash provided  from (used for) financing activities                              |       | 1,934                            |       | (1,339 | ) |
|                                                                             |       |                             |       |   |   |
| Increase  (decrease) in cash and cash equivalents                                |       | 23                               |       | (13,946 | ) |
|                                                                             |       |                             |       |   |   |
| Cash and cash  equivalents at the beginning of the period                        |       | 1,483                            |       | 34,038 |   |
|                                                                             |       |                             |       |   |   |
| Cash and cash equivalents  at the end of the period                              |       | $                                | 1,506      |   | $ | 20,092 |   |

 

The accompanying notes are an integral part of the consolidatedfinancial statements.

5

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**COURIER CORPORATION**

**NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED)**

**A.            SUMMARY OFSIGNIFICANT ACCOUNTING POLICIES**

**Unaudited Financial Statements**

The balance sheet as of December 30, 2006, the statements of income forthe three-month periods ended December 30, 2006 and December 24, 2005, and thestatements of cash flows for the three-month periods ended December 30, 2006and December 24, 2005 are unaudited.  Inthe opinion of management, all adjustments necessary for a fair presentation ofsuch financial statements have been recorded. Such adjustments consisted only of normal recurring items.

Certain information and footnote disclosures normally included infinancial statements prepared in accordance with accounting principlesgenerally accepted in the United States (“generally accepted accountingprinciples”) have been condensed or omitted. The balance sheet data as of September 30, 2006 was derived from auditedyear-end financial statements, but does not include disclosures required by generallyaccepted accounting principles.  It issuggested that these interim financial statements be read in conjunction withthe Company’s most recent Form 10-K and Annual Report for the year endedSeptember 30, 2006.

**PrepublicationCosts**

Prepublication costs, associated with creating new titles in thespecialty publishing segment, are amortized to cost of sales using thestraight-line method over estimated useful lives of three years for Research& Education Association, Inc. (“REA”), four years for Dover Publications,Inc. (“Dover”) and five years for Federal Marketing Corporation, d/b/a CreativeHomeowner (“Creative Homeowner”).

**Goodwill and Other Intangibles**

The Companyevaluates possible impairment annually or whenever events or circumstancesindicate that the carrying value of the assets may not be recoverable. Therewere no such events or circumstances in the period presented.  Other intangibles include customer listsrelated to the fiscal 2006 acquisitions of Creative Homeowner and Moore-LangenPrinting Company, Inc. (“Moore Langen”), which are being amortized over 15-yearand 10-year periods, respectively (Note G). Amortization expense related to customer lists in the first quarters offiscal 2007 and 2006 was approximately $200,000 and $4,000, respectively.

**NewAccounting Pronouncements**

In July 2006, theFASB issued Interpretation No. 48, “Accounting for Uncertainty in Income Taxes”(“FIN No. 48”), an interpretation of FASB Statement No. 109, “Accounting forIncome Taxes.”  FIN No. 48 applies tofiscal years beginning after December 15, 2006; the Company’s 2008 fiscalyear.  In September 2006, the FASB issuedStatement of Financial Accounting Standards No. 158, “Employers’ AccountingDefined Benefit Pension and Other Postretirement Plans” (“SFAS 158”), whichwill be effective at the end of the Company’s 2007 fiscal year.  The Company does not believe the adoption ofeither FIN No. 48 or SFAS 158 will have a material effect on its consolidatedfinancial position, results of operations or cash flows.

6

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# **B.            INVENTORIES**

Inventories are valued at the lower of cost or market.  Cost is determined using the last-in,first-out (LIFO) method for approximately 38% and 37% of the Company’sinventories at December 30, 2006 and September 30, 2006, respectively.  Other inventories, primarily in the specialtypublishing segment, are determined on a first-in, first-out (FIFO) basis.  Inventories consisted of the following:
|                 | ** ** | **(000’s Omitted)**     | ** ** |
|-----------------|------------|-----------------------------------|------------|
| ** **      | ** ** | **December 30,   2006** | ** ** | **September 30,  2006** | ** ** |
| Raw materials   |       | $                                 | 4,410      |   | $ | 3,910 |   |
| Work in process |       | 8,517                             |       | 6,295 |   |
| Finished goods  |       | 20,607                            |       | 19,360 |   |
| Total           |       | $                                 | 33,534     |   | $ | 29,565 |   |

 

# **C.            INCOMETAXES**

The provision for income taxesdiffers from that computed using the statutory federal income tax rates for thefollowing reasons:              
|                                       | ** ** | **(000’s Omitted)**     | ** ** |
|---------------------------------------|------------|-----------------------------------|------------|
| ** **                            | ** ** | **Three Months Ended**  | ** ** |
| ** **                            | ** ** | **December 30,   2006** | ** ** | **December 24,   2005** | ** ** |
| Federal taxes at statutory rates      |       | $                                 | 2,247      |   | 35.0 | % | $ | 2,450 |   | 35.0 | % |
| State taxes, net of federal benefit   |       | 214                               |       | 3.3 |   | 207 |   | 3.0 |   |
| Federal manufacturers’ deduction |       | (55                               | )          | (0.9 | ) | (73 | ) | (1.1 | ) |
| Tax benefit of export related income  |       | (22                               | )          | (0.3 | ) | (112 | ) | (1.6 | ) |
| Stock-based compensation (Note F)     |       | 8                                 |       | 0.1 |   | 37 |   | 0.5 |   |
| Other                                 |       | 6                                 |       | 0.1 |   | 3 |   | 0.1 |   |
| Total                                 |       | $                                 | 2,398      |   | 37.3 | % | $ | 2,512 |   | 35.9 | % |

 

# **D.            NETINCOME PER SHARE**

The following is areconciliation of the shares used in the calculation of basic and dilutedincome per share.  Potentially dilutiveshares, calculated using the treasury stock method,   consist of shares issued under the Company’s stock option plans.
|                                         | ** ** | **(000’s Omitted)**     | ** ** |
|-----------------------------------------|------------|-----------------------------------|------------|
| ** **                              | ** ** | **Three Months Ended**  | ** ** |
| ****                                    | ** ** | **December 30,   2006** | ** ** | **December 24,   2005** | ** ** |
| ** **                              | ** ** | ** **                        | ** ** | ** ** | ** ** |
| Average shares outstanding for basic    |       | 12,415                            |       | 12,289 |   |
| Effect of potentially dilutive shares   |       | 241                               |       | 262 |   |
| Average  shares outstanding for diluted |       | 12,656                            |       | 12,551 |   |

 

7

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# **E.             BUSINESSSEGMENTS**

TheCompany has two business segments: book manufacturing and specialty publishing.The book manufacturing segment offers a full range of services from productionthrough storage and distribution for religious, educational and specialty tradebook publishers. The specialty publishing segment consists of Dover and REA, aswell as Creative Homeowner since its acquisition in April 2006 (Note G).

# In evaluating segment performance, managementprimarily focuses on income or loss before taxes, stock-based compensation andother income.  The elimination ofintersegment sales and related profit represents sales from the bookmanufacturing segment to the specialty publishing segment.  Corporate expenses that are allocated to the segmentsinclude various support functions such as information technology services,finance, human resources and engineering, and include depreciation andamortization expense related to corporate assets*.*

Thefollowing table provides segment information for the three-month periods endedDecember 30, 2006 and December 24, 2005.
|                                    | ** ** | **(000’s Omitted)**    | ** ** |
|------------------------------------|------------|----------------------------------|------------|
| ** **                         | ** ** | **Three Months Ended** | ** ** |
| ** **                         | ** ** | **December 30,  2006**      | ** ** | **December 24,  2005** | ** ** |
| ** **                         | ** ** | ** **                       | ** ** | ** ** | ** ** |
| Net sales:                         |       |                             |       |   |   |
| Book manufacturing                 |       | $                                | 49,962     |   | $ | 48,234 |   |
| Specialty publishing               |       | 16,758                           |       | 10,921 |   |
| Elimination of intersegment sales  |       | (2,408                           | )          | (1,471 | ) |
| Total                              |       | $                                | 64,312     |   | $ | 57,684 |   |
|                               |       |                             |       |   |   |
| Income before taxes:               |       |                             |       |   |   |
| Book manufacturing                 |       | $                                | 5,891      |   | $ | 6,163 |   |
| Specialty publishing               |       | 807                              |       | 1,085 |   |
| Stock-based compensation           |       | (363                             | )          | (336 | ) |
| Elimination of intersegment profit |       | 86                               |       | 87 |   |
| Total                              |       | $                                | 6,421      |   | $ | 6,999 |   |

 

**F.             STOCK-BASED COMPENSATION**

With the adoptionof SFAS 123R, “Share-Based Payment,” at the beginning of fiscal 2006, theCompany records stock-based compensation expense for the cost of stock options,stock grants, and shares issued under the Company’s 1999 Employee StockPurchase Plan. The fair value of each option awarded is calculated on the dateof grant using the Black-Scholes option-pricing model. Stock-based compensationrecognized in selling and administrative expenses in the accompanying financialstatements in the first quarter of fiscal 2007 and 2006 was $363,000 and$336,000, respectively.  The related taxbenefit recognized in the first quarter of fiscal 2007 and 2006 was $112,000and $80,000, respectively. Unrecognized stock-based compensation cost atDecember 30, 2006 was $1.6 million, to be recognized over a weighted-averageperiod of 2.3 years.

8

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**StockIncentive Plan:** TheCompany’s stock incentive plan provides for the granting of stock options andstock grants up to a total of 2,064,375 shares. Under the plan provisions, both non-qualified and incentive stockoptions to purchase shares of the Company’s common stock may be granted to keyemployees.  The option price per sharemay not be less than the fair market value of stock at the time the option isgranted and incentive stock options must expire not later than ten years fromthe date of grant.  The Company annuallyissues a combination of stock options and stock grants to its key employees.Stock options and stock grants generally vest over 3 years.  During the first quarter of fiscal 2007,4,100 restricted stock awards were granted with a weighted-average fair valueof $38.80 per share.  At December 30,2006, non-vested restricted stock grants outstanding were 40,070 shares with aweighted-average grant-date fair value of $34.29.

Thefollowing table provides stock option activity under this plan in the firstquarter of fiscal 2007:
|                                   | ** ** | ** **         | ** ** | **Weighted Average** | ** ** | **Aggregate**                        | ** ** |
|-----------------------------------|------------|--------------------|------------|---------------------------|------------|--------------------------------------|------------|
| ** **                        | ** ** | **Option  Shares** | ** ** | **Exercise   Price** | ** ** | **Remaining   Term (yrs)** | ** ** | **Intrinsic  Value** | ** ** |
| Outstanding at September 30, 2006 |       | 401,891            |       | $                         | 21.69      |                                 |       |   |   |   |
| Issued                            |       | 500                |       | 38.98                     |       |                                 |       |   |   |
| Exercised                         |       | (6,518             | )          | 18.64                     |       |                                 |       | $ | 132,705 |   |
| Outstanding at December 30, 2006  |       | 395,873            |       | $                         | 21.76      |                                 | 3.2        |   | $ | 6,814,073 |   |
|                              |       |               |       |                      |       |                                 |       |   |   |
| Exercisable at December 30, 2006  |       | 333,763            |       | $                         | 19.01      |                                 | 2.9        |   | $ | 6,662,805 |   |
| Available for future  grants      |       | 271,925            |       |                      |       |                                 |       |   |   |

 

**Directors’Option Plan:** In January2005, stockholders approved the Courier Corporation 2005 Stock Equity Plan forNon-Employee Directors (the “2005 Plan”). Under the 2005 Plan provisions,non-qualified stock options to purchase shares of the Company’s common stockmay be granted to non-employee directors up to a total of 225,000 shares.  The option price per share is the fair marketvalue of stock at the time the option is granted.  The options are immediately exercisable andhave a term of five years. The 2005 Plan replaced the previous non-employeedirectors’ plan, which had been adopted in 1989.  The following table provides activity underthese plans in the first quarter of fiscal 2007:
| ** **                        | ** ** | ** **         | ** ** | **Weighted Average** | ** ** | **Aggregate**                        | ** ** |
|-----------------------------------|------------|--------------------|------------|---------------------------|------------|--------------------------------------|------------|
| ** **                        | ** ** | **Option  Shares** | ** ** | **Exercise   Price** | ** ** | **Remaining   Term (yrs)** | ** ** | **Intrinsic   Value** | ** ** |
| Outstanding at September 30, 2006 |       | 185,127            |       | $                         | 25.78      |                                 |       |   |   |   |
| Issued                            |       | —             |       | —                    |       |                                 |       |   |   |
| Exercised                         |       | (9,969             | )          | 35.50                     |       |                                 |       | $ | 24,375 |   |
| Outstanding at December 30, 2006  |       | 175,158            |       | $                         | 25.23      |                                 | 2.3        |   | $ | 2,406,484 |   |
|                              |       |               |       |                      |       |                                 |       |   |   |
| Exercisable at December 30, 2006  |       | 175,158            |       | $                         | 25.23      |                                 | 2.3        |   | $ | 2,406,484 |   |
| Available  for future grants      |       | 135,684            |       |                      |       |                                 |       |   |   |

 

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**Employee Stock Purchase Plan:** The Company’s 1999 Employee Stock Purchase Plan (“ESPP”), as amended,covers an aggregate of 337,500 shares of Company common stock for issuanceunder the plan.  Eligible employees maypurchase shares of Company common stock at not less than 85% of fair marketvalue at the end of the grant period. During the first quarter of fiscal 2007, no shares were issued under theESPP.

**G.            BUSINESS ACQUISITIONS**

On October 17, 2005, the Company acquired MooreLangen, an Indianapolis-based printer specializing in book covers, in a $15million cash transaction.  Theacquisition was accounted for as a purchase, and accordingly, Moore Langen’sfinancial results were included in the book manufacturing segment in theconsolidated financial statements from the date of acquisition. On April 28,2006, the Company acquired Creative Homeowner, a New Jersey-based publisher anddistributor of books, home plans and related products for the home and gardenretail book market.  The Company purchased100% of the stock in a $37 million cash transaction.  The acquisition was accounted for as apurchase, and accordingly, Creative Homeowner’s financial results were includedin the specialty publishing segment in the consolidated financial statements fromthe date of acquisition.

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| **Item 2.**                                        | **COURIER CORPORATION** |
|----------------------------------------------------|-------------------------|
| **MANAGEMENT’S DISCUSSION AND ANALYSIS OF**   |
| **FINANCIAL  CONDITION AND RESULTS OF OPERATIONS** |

 

**Critical Accounting Policies and Estimates:**

The Company’s consolidatedcondensed financial statements have been prepared in accordance with generallyaccepted accounting principles.  Thepreparation of these financial statements requires management to make estimatesand assumptions that affect the amounts reported in these financial statementsand accompanying notes.   On an ongoingbasis, management evaluates its estimates and judgments, including thoserelated to collectibility of accounts receivable, recovery of inventories,impairment of goodwill, prepublication costs and income taxes.  Management bases its estimates and judgmentson historical experience and various other factors believed to be reasonableunder the circumstances, the results of which form the basis for makingjudgments about the carrying value of assets and liabilities at the date of thefinancial statements and the reported amounts of revenues and expenses duringthe periods presented.  Actual resultsmay differ from these estimates.  Thesignificant accounting policies which management believes are most critical toaid in fully understanding and evaluating the Company’s reported financialresults include the following:

Accounts Receivable  Management performs ongoing creditevaluations of the Company’s customers and adjusts credit limits based uponpayment history and the customer’s current creditworthiness.  Collections and payments from customers arecontinuously monitored.  A provision forestimated credit losses is determined based upon historical experience and anyspecific customer collection issues that have been identified.  If the financial condition of the Company’scustomers were to deteriorate, resulting in an impairment of their ability tomake payments, additional allowances may be required.

Inventories   Managementrecords reductions in the cost basis of inventory for excess and obsoleteinventory based primarily upon historical and forecasted product demand.  If actual market conditions are lessfavorable than those projected by management, additional inventory charges maybe required.

##### Goodwill andOther Intangibles Other intangibles include customer lists which are amortized on astraight-line basis over periods ranging from ten to fifteen years. The Companyevaluates possible impairment of goodwill and other intangibles annually orwhenever events or circumstances indicate that the carrying value of the assetsmay not be recoverable.  The Companycompleted the annual impairment test at September 30, 2006 resulting in nochange to the nature or carrying amounts of its intangible assets.  Changes in market conditions or pooroperating results could result in a decline in value thereby potentiallyrequiring an impairment charge in the future.

Prepublication Costs   The Company capitalizes prepublicationcosts, which include the costs of acquiring rights to publish a work and costsassociated with bringing a manuscript to publication such as artwork andeditorial efforts. Prepublication costs are amortized on a straight-line basisover periods ranging from three to five years. Management regularly evaluates the sales and profitability of theproducts based upon historical and forecasted demand.  Based upon this evaluation, adjustments maybe required to amortization expense.

Income Taxes   The income tax provision and related accruedtaxes are based on amounts reported on the Company’s tax returns and changes indeferred taxes.  Deferred income tax liabilities and assets are determined based uponthe differences between the financial statement and tax bases of assets andliabilities.  Changes in therecoverability of the Company’s deferred tax assets or audits by taxauthorities could result in future charges or credits to income tax expense,and related accrued and deferred taxes.

11

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**Overview:**

Courier Corporation, founded in1824, is one of America’s leading book manufacturers and specialty publishers.  The Company has two business segments: bookmanufacturing and specialty publishing. The book manufacturing segment streamlines the process of bringing booksfrom the point of creation to the point of use. Based on sales, Courier is the fourth largest book manufacturer in theUnited States and largest in the Northeast, offering services from prepress andproduction through storage and distribution. The specialty publishing segment consists of Dover Publications, Inc. (“Dover”)and Research & Education Association, Inc. (“REA”), as well as the April2006 acquisition of Federal Marketing Corporation, d/b/a Creative Homeowner (“CreativeHomeowner”).  Dover publishes over 9,000titles in more than 30 specialty categories ranging from literature and poetryclassics to paper dolls, and from music scores to clip art.  REA publishes test preparation andstudy-guide books and software for high school, college and graduate students,and professionals.  Creative Homeownerpublishes and distributes books, home plans and related products to the homeand garden market.

**Results of Operations:**

## FINANCIAL HIGHLIGHTS

## (dollars in thousands except per share amounts)

|                                     | ** ** | **Three Months Ended** | ** ** |
|-------------------------------------|------------|----------------------------------|------------|
| ** **                          | ** ** | **December 30,  2006**      | ** ** | **December 24,  2005** | ** ** | **%  Change** | ** ** |
|                                |       |                             |       |   |   |   |   |
| Net sales                           |       | $                                | 64,312     |   | $ | 57,684 |   | 11.5 | % |
| Gross profit                        |       | 20,144                           |       | 18,531 |   | 8.7 | % |
| As a percentage of sales            |       | 31.3                             | %          | 32.1 | % |   |   |
| Selling and administrative expenses |       | 13,501                           |       | 11,680 |   | 15.6 | % |
| Interest (income) expense, net      |       | 222                              |       | (148 | ) |   |   |
| Pretax income                       |       | 6,421                            |       | 6,999 |   | -8.3 | % |
| Net income                          |       | $                                | 4,023      |   | $ | 4,487 |   | -10.3 | % |
| Net  income per diluted share       |       | $                                | 0.32       |   | $ | 0.36 |   | -11.1 | % |

 

# Revenues in the first quarter of fiscal 2007 increasedin both of the Company’s operating segments compared to the same period lastyear despite a slowdown in text book demand during the early fall for the bookmanufacturing segment and a lackluster start to the holiday season at majorretail chains for the specialty publishing segment.  Book manufacturing revenues were up 4%reflecting modest growth in textbook sales and several large orders fromspecialty trade publishers.  Sales in thespecialty publishing segment were up 53%, reflecting incremental sales pursuantto the April 2006 acquisition of Creative Homeowner and continued sales growthat REA, offsetting a 13% decline in sales at Dover.

# *Business Acquisitions*

OnApril 28, 2006, the Company acquired Creative Homeowner, a New Jersey-basedpublisher and distributor of books, home plans and related products for thehome and garden retail book market.  Theacquisition was accounted for as a purchase, and accordingly, CreativeHomeowner’s financial results were included in the specialty publishing segmentin the consolidated financial statements from the date of acquisition. OnOctober 17, 2005, the Company acquired Moore-Langen Printing Company, Inc. (“MooreLangen”), an Indianapolis-based printer specializing in book covers.  The acquisition was accounted for as apurchase, and accordingly, Moore Langen’s financial results were included inthe book manufacturing segment from the date of acquisition.

12

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*Book Manufacturing Segment*

## SEGMENT HIGHLIGHTS

## (dollars in thousands)

|                                     | ** ** | **Three Months Ended** | ** ** |
|-------------------------------------|------------|----------------------------------|------------|
| ** **                          | ** ** | **December 30,  2006**      | ** ** | **December 24,  2005** | ** ** | **%  Change** | ** ** |
|                                |       |                             |       |   |   |   |   |
| Net sales                           |       | $                                | 49,962     |   | $ | 48,234 |   | 3.6 | % |
| Gross profit                        |       | 13,052                           |       | 13,564 |   | -3.8 | % |
| As a percentage of sales            |       | 26.1                             | %          | 28.1 | % |   |   |
| Selling and administrative expenses |       | 7,379                            |       | 7,600 |   | -2.9 | % |
| Interest income                     |       | (218                             | )          | (199 | ) |   |   |
| Pretax  income                      |       | $                                | 5,891      |   | $ | 6,163 |   | -4.4 | % |

 

Within this segment, the Company focuses on three key markets: education,religious and specialty trade.  Sales tothe education market rose 2% in the first quarter of fiscal 2007 compared tolast year.  Textbook demand started veryslowly in the beginning of the quarter, but picked up strongly, primarily dueto sales of college textbooks.  Theincreased order flow towards the end of the quarter coincided with theinstallation and start up in December 2006 of another four-color press.  Sales to the religious market were down 3%from last year’s first quarter, reflecting normal fluctuations related to ordertiming.  Sales to the specialty trademarket were up 14% for the first quarter, as a result of a few large one-timeorders.

Gross profit in this segment decreased by 4% to $13.1 million for thequarter, and as a percentage of sales decreased to 26.1% from 28.1% in lastyear’s first quarter.  This decrease wasattributable to the lower sales growth, a less favorable product mix, and theimpact of a highly competitive industry environment which exceeded productivitygains and cost reductions.

Selling and administrative expenses for the segment decreased 3% in thefirst quarter to $7.4 million and, as a percentage of sales, decreased to 14.8%from 15.8% last year.

Intercompany interest income allocated to the book manufacturing segmentin the first quarter increased to $218,000 compared to $199,000 last year.

First quarter pretax income in this segment was $5.9 million, or, on anafter-tax basis, $.30 per diluted share, a decrease of 4% from $6.2 million, or$.32 per diluted share, in the corresponding quarter last year.

13

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*Specialty Publishing Segment*

## SEGMENT HIGHLIGHTS

## (dollars in thousands)

|                                     | ** ** | **Three Months Ended** | ** ** |
|-------------------------------------|------------|----------------------------------|------------|
| ** **                          | ** ** | **December 30,  2006**      | ** ** | **December 24,  2005** | ** ** | **%  Change** | ** ** |
|                                |       |                             |       |   |   |   |   |
| Net sales                           |       | $                                | 16,758     |   | $ | 10,921 |   | 53.4 | % |
| Gross profit                        |       | 7,005                            |       | 4,880 |   | 43.5 | % |
| As a percentage of sales            |       | 41.8                             | %          | 44.7 | % |   |   |
| Selling and administrative expenses |       | 5,760                            |       | 3,744 |   | 53.8 | % |
| Interest expense                    |       | 438                              |       | 51 |   |   |   |
| Pretax  income                      |       | $                                | 807        |   | $ | 1,085 |   | -25.6 | % |

 

The Company’s specialtypublishing segment reported first quarter sales of $16.8 million, up 53% from$10.9 million in last year’s first quarter. The increase was attributable to the Creative Homeowner acquisitionadding $6.9 million to sales in the first quarter, as well as sales growth atREA.  Sales at Dover were down 13%following an exceptionally strong fourth quarter in fiscal 2006.  In addition, a number of large retail chainsreported increased sales of Dover books to their customers during the period whileDover sales to these same retailers were down, leaving them with lowerinventories.  Sales to smaller retailerswere down 6% in the Company’s first quarter compared to the same period lastyear, however orders received from these retailers increased 11% over lastyear.  This disparity between orders andsales was due, in large part, to last year’s $600,000 backlog reduction in thefirst quarter following the completion of a warehouse consolidation and theimplementation of SAP, an enterprise-wide information system.

Gross profit as apercentage of sales for the segment decreased in the quarter to 41.8% from44.7% in the corresponding period last year. Creative Homeowner reduced the overall gross profit percentage in thesegment because of their lower-margin distribution business.  REA’s gross profit percentage continued toimprove in the first quarter while Dover’s decreased slightly due to the lowersales volume, despite productivity improvements and lower costs compared to thefirst quarter last year.

Selling andadministrative expenses in this segment were $5.8 million in the first quarter,an increase of 54%, primarily due to the addition of Creative Homeowner to thisyear’s first quarter.  As a percentage ofsales, selling and administrative expenses were 34.4%, which was comparable tothe first quarter last year.

Intercompany interest expense is allocated to the specialty publishingsegment based on acquisition costs, reduced by cash generated by each businesssince acquisition.  Interest expense forthe first quarter of fiscal 2007 was $438,000 compared to $51,000 lastyear.  The increase reflects the $37million purchase of Creative Homeowner in April 2006.

Pretax income in the specialty publishing segment for the first quarterwas $0.8 million, or, on an after-tax basis, $.04 per diluted share, comparedto $1.1 million, or $.06 per diluted share in last year’s first quarter.

*Total Consolidated Company*

Interest expense, net of interest income, was $222,000 in the firstquarter of fiscal 2007, compared to net interest income of $148,000 in the sameperiod of fiscal 2006.  Average debtunder the revolving credit facility in the first quarter of fiscal 2007 wasapproximately $18.7 million at an average annual interest rate of 5.8%,generating interest expense of approximately $275,000.  Interest expense also includes commitmentfees and other costs associated with maintaining this credit facility.  Interest capitalized in the first threemonths of fiscal 2007 was approximately $125,000; no such interest wascapitalized last year.  In the firstquarter of fiscal 2006, cash investments averaged approximately $23 millioninvested at an average annual interest rate of 3.6%, generating interest incomeof approximately $200,000.

14

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The Company’seffective tax rate for the first quarter of fiscal 2007 was 37.3% compared to35.9% for the same period last year.  Theincrease in the effective tax rate reflects the phase out of the tax benefit ofexport related income and a slower phase in of the tax benefit for manufacturers.  In addition, there was a slight increase inthe Company’s effective state tax rate.

For purposes of computing netincome per diluted share, weighted average shares outstanding increased byapproximately 105,000 shares over last year’s first quarter.  The increase was largely due to optionsexercised and shares issued under the Company’s stock plans.

**Liquidity and Capital Resources:**

During the first three monthsof fiscal 2007, operations provided approximately $7.4 million of cash.  Net income was $4.0 million and depreciationand amortization were $4.4 million. Working capital increased by approximately $1.7 million, including a $4million increase in inventories, of which $2 million was a growth in work inprocess.

Investment activities in the first quarter of fiscal 2007 usedapproximately $9.3 million of cash. Capital expenditures were approximately$7.9 million, primarily for the four-color press that was installed in December2006 in the Kendallville, Indiana facility as well as a related binderyexpansion. This press is identical to the presses installed in April 2004 andDecember 2005.  For the entire fiscalyear, capital expenditures are expected to be approximately $25 to $28 million.  This amount includes completion of thecurrent four-color expansion program at Kendallville as well as expansion ofprinting and binding capacity in the religious book manufacturing operation inPhiladelphia.  Prepublication costs were$1.4 million compared to $0.8 million in the first three months last year,primarily from the addition of Creative Homeowner.  For the full fiscal year, prepublicationcosts are projected to be approximately $5 million.

Financing activities for the first three months of fiscal 2007 providedapproximately $1.9 million of cash.  Cashdividends were $2.2 million while proceeds from stock plans were $0.5 million,primarily from the exercise of stock options, and borrowings increased by $3.7million.  At December 30, 2006, theCompany had $20.6 million in borrowings under its $100 million long-termrevolving credit facility, which bears interest at a floating rate.  The revolving credit facility is used by theCompany for both its long-term and short-term financing needs.  In November 2006, the Company increased theamount available under this facility to $100 million and extended the maturitydate to March 2011.  The Company believesthat its cash on hand, cash from operations and the available credit facilitywill be sufficient to meet its cash requirements through 2007.

The following table summarizesthe Company’s contractual obligations and commitments at September 30, 2006 tomake future payments as well as its existing commercial commitments except, asnoted, for purchase obligations (which represent capital commitments) and for long-termdebt (which includes the revolving credit facility), which are as of December30, 2006.
|                             | ** ** | ** ** | ** ** | **(000’s Omitted)**             | ** ** |
|-----------------------------|------------|------------|------------|-------------------------------------------|------------|
| ** **                  | ** ** | ** ** | ** ** | **Payments due by period** | ** ** |
| ** **                  | ** ** | ** ** | ** ** | **Less than**                        | ** ** | **1 to 3** | ** ** | **4 to 5** | ** ** | **After 5** | ** ** |
| ** **                  | ** ** | **Total**  | ** ** | **1 Year**                           | ** ** | **Years** | ** ** | **Years** | ** ** | **Years** | ** ** |
| Contractual Payments:       |       |       |       |                                      |       |   |   |   |   |   |   |
| Long-Term Debt (1)          |       | $          | 21,036     |                                      | $          | 88 |   | $ | 20,794 |   | $ | 154 |   | $ | — |   |
| Operating Leases            |       | 10,432     |       | 3,103                                     |       | 3,727 |   | 2,056 |   | 1,546 |   |
| Purchase Obligations (1)    |       | 11,150     |       | 10,550                                    |       | 600 |   | — |   | — |   |
| Other Long-Term Liabilities |       | 3,037      |       | —                                    |       | 1,413 |   | 350 |   | 1,274 |   |
| Total                       |       | $          | 45,655     |                                      | $          | 13,741 |   | $ | 26,534 |   | $ | 2,560 |   | $ | 2,820 |   |

 

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(1) Represent amounts at December 30, 2006.

15

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**NewAccounting Pronouncements**

InJuly 2006, the FASB issued Interpretation No. 48, “Accounting for Uncertaintyin Income Taxes” (“FIN No. 48”), an interpretation of FASB Statement No. 109, “Accountingfor Income Taxes.”  FIN No. 48 applies tofiscal years beginning after December 15, 2006; the Company’s 2008 fiscalyear.  In September 2006, the FASB issuedStatement of Financial Accounting Standards No. 158, “Employers’ AccountingDefined Benefit Pension and Other Postretirement Plans” (“SFAS 158”), whichwill be effective at the end of the Company’s 2007 fiscal year.  The Company does not believe the adoption ofeither FIN No. 48 or SFAS 158 will have a material effect on its consolidatedfinancial position, results of operations or cash flows.

**Forward-Looking Information:**

ThisQuarterly Report on Form 10-Q and the Company’s Annual Report for the yearended September 30, 2006 on Form 10-K include forward-looking statements.  Statements that describe future expectations,plans or strategies are considered “forward-looking statements” as that term isdefined under the Private Securities Litigation Reform Act of 1995 and releasesissued by the Securities and Exchange Commission.  The words “believe,” “expect,” “anticipate,” “intend,”“estimate” and other expressions which are predictions of or indicate futureevents and trends and which do not relate to historical matters identifyforward-looking statements.  Suchstatements are subject to risks and uncertainties that could cause actualresults to differ materially from those currently anticipated.  Factors that could affect actual resultsinclude, among others, changes in customers’ demand for the Company’s products,including seasonal changes in customer orders, changes in raw material costsand availability, pricing actions by competitors, consolidation among customersand competitors, success in the integration of acquired businesses, changes inoperating expenses including energy costs, changes in technology, difficultiesin the start up of new equipment or information technology systems, changes incopyright laws, changes in tax regulations, changes in the Company’s effectiveincome tax rate, and general changes in economic conditions, including currencyfluctuations and changes in interest rates. Although the Company believes that the assumptions underlying theforward-looking statements are reasonable, any of the assumptions could beinaccurate, and therefore, there can be no assurance that the forward-lookingstatements will prove to be accurate. The forward-looking statements included herein are made as of the datehereof, and the Company undertakes no obligation to update publicly suchstatements to reflect subsequent events or circumstances.

16

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| **Item 3.** | **QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK** |
|-------------|----------------------------------------------------------------|

 

There have been no material changes from the information concerning theCompany’s “Quantitative and Qualitative Disclosures About Market Risk” aspreviously reported in the Company’s Annual Report on Form 10-K for the yearended September 30, 2006.
| **Item 4.** | **CONTROLS  AND PROCEDURES** |
|-------------|------------------------------|

 

**(a)       Evaluation of disclosure controls andprocedures**

As required by Rule 13a-15under the Securities Exchange Act of 1934, as of the end of the period coveredby this Quarterly Report, the Company carried out an evaluation under thesupervision and with the participation of the Company’s management, includingthe Company’s Chief Executive Officer and Chief Financial Officer, of theeffectiveness of the design and operation of the Company’s disclosure controlsand procedures.  Based upon thatevaluation, the Chief Executive Officer and Chief Financial Officer concludedthat the Company’s disclosure controls and procedures are effective to ensurethat information required to be disclosed by the Company in the reports itfiles or submits under the Exchange Act is recorded, processed, summarized andreported, within the time periods specified in the Securities and ExchangeCommission’s rules and forms.

**(b)       Changes in internal controls overfinancial reporting**

There was no change in theCompany’s internal control over financial reporting that occurred during theperiod covered by this Quarterly Report that has materially affected, or thatis reasonably likely to materially affect, the Company’s internal control overfinancial reporting.

17

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**COURIERCORPORATION**

#### **PART II. OTHER INFORMATION**

| **Item 1.**  | ** ** | **Legal Proceedings**                                                                                                                                                                |
|--------------|------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ** **   | ** ** | ** **                                                                                                                                                                           |
|         |       | None.                                                                                                                                                                                |
|         |       |                                                                                                                                                                                 |
| **Item 1A.** | ** ** | **Risk Factors**                                                                                                                                                                     |
| ** **   | ** ** | ** **                                                                                                                                                                           |
|         |       | There have been no material changes to the risk  factors as previously disclosed in Item 1A in the Company’s Annual Report on Form 10-K for the year ended  September 30, 2006. |
|         |       |                                                                                                                                                                                 |
| **Item 2.**  | ** ** | **Unregistered Sales of  Equity Securities and Use of Proceeds**                                                                                                                     |
| ** **   | ** ** | ** **                                                                                                                                                                           |
|         |       | None.                                                                                                                                                                                |
|         |       |                                                                                                                                                                                 |
| **Item 3.**  |       | **Defaults Upon Senior Securities**                                                                                                                                                  |
| ** **   |       |                                                                                                                                                                                 |
|         |       | None.                                                                                                                                                                                |
|         |       |                                                                                                                                                                                 |
| **Item 4.**  | ** ** | **Submission of Matters to a  Vote of Security Holders**                                                                                                                             |
| ** **   | ** ** | ** **                                                                                                                                                                           |
|         |       | None.                                                                                                                                                                                |
|         |       |                                                                                                                                                                                 |
| **Item 5.**  | ** ** | **Other Information**                                                                                                                                                                |
| ** **   | ** ** | ** **                                                                                                                                                                           |
|         |       | None.                                                                                                                                                                                |
|         |       |                                                                                                                                                                                 |
| **Item 6.**  | ** ** | **Exhibits**                                                                                                                                                                         |
| ** **   | ** ** | ** **                                                                                                                                                                           |
| ** **   | ** ** | ** **                                                                                                                                                                           |
| ** **   | ** ** | **Exhibit  No.**                                                                                                                                                                     | ** ** | **Description** |
| ** **   | ** ** | ** **                                                                                                                                                                           | ** ** | ** ** |
| ** **   | ** ** | 10.1                                                                                                                                                                                 | ** ** | Amendment, dated November 9, 2006, to Amended and  Restated Revolving Credit Agreement, dated as of March 31, 2003, between  Courier Corporation, Sovereign Bank, Citizens Bank of Massachusetts, KeyBank  National Association, JPMorgan Chase Bank, N.A., and Wells Fargo Bank, N.A.,  providing for a $100 million revolving credit facility (filed as Exhibit 10  to the Company’s Current Report on Form 8-K dated November 15, 2006, and  incorporated herein by reference). |
| ** **   | ** ** | ** **                                                                                                                                                                           | ** ** | ** ** |
| ** **   | ** ** | 31.1*                                                                                                                                                                                | ** ** | Certification of Chief Executive Officer |
| ** **   | ** ** | 31.2*                                                                                                                                                                                | ** ** | Certification of Chief Financial Officer |
|         |       | 32.1*                                                                                                                                                                                |   | Certification of Chief Executive Officer |
| ** **   | ** ** | 32.2*                                                                                                                                                                                | ** ** | Certification of Chief Financial Officer |

 

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* Filed herewith.

18

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**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, theCompany has duly caused this report to be signed on its behalf by theundersigned thereunto duly authorized.

**COURIER CORPORATION**

**(Registrant)**
| *  **February 8, 2007* | * *   | By:    | *  s/James F. Conway  III* | * * | * * | * * |
|----------------------------------|------------|--------|--------------------------------------|----------|----------|----------|
| Date                             |       |   | James F. Conway III                  |     |     |
|                             |       |   | Chairman, President and              |     |     |
|                             |       |   | Chief Executive Officer              |     |     |
|                             |       |   |                                 |     |     |
|                             |       |   |                                 |     |     |
| *  February 8, 2007*   | * *   | By:    | *  s/Peter M. Folger*      | * * | * * | * * |
| Date                             |       |   | Peter M. Folger                      |     |     |
| ** **                       | ** ** |   | Senior Vice President and            |     |     |
|                             |       |   | Chief Financial Officer              |     |     |
| *  February 8, 2007*   | * *   | By:    | *  s/Kathleen M. Leon*     | * * | * * | * * |
| Date                             |       |   | Kathleen M. Leon                     |     |     |
| ** **                       | ** ** |   | Controller and                       |     |     |
|                             |       |   | Chief Accounting Officer             |     |     |

 

19

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**EXHIBIT INDEX**
| Exhibit No. | ** ** | **Description**                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|-------------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|        |       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| 10.1        |       | Amendment, dated November 9, 2006, to Amended and  Restated Revolving Credit Agreement, dated as of March 31, 2003, between  Courier Corporation, Sovereign Bank, Citizens Bank of Massachusetts, KeyBank  National Association, JPMorgan Chase Bank, N.A., and Wells Fargo Bank, N.A.,  providing for a $100 million revolving credit facility (filed as Exhibit 10  to the Company’s Current Report on Form 8-K dated November 15, 2006, and incorporated  herein by reference). |
| 31.1*       |       | Certification of Chief Executive Officer                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 31.2*       |       | Certification of Chief Financial Officer                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 32.1*       |       | Certification of Chief Executive Officer                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| 32.2*       |       | Certification of Chief Financial Officer                                                                                                                                                                                                                                                                                                                                                                                                                                                |

 

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* Filed herewith.

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