##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended September 30, 2010
 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 001-12631
 
 CONSOLIDATED GRAPHICS, INC.
  Texas
    
    76-0190827(State or other jurisdiction of
    
    (I.R.S. Employer Identification No.)incorporation or organization)5858 Westheimer Road, Suite 200Houston, Texas
    
    77057(Address of principal executive offices)
    
    (Zip Code)
 (713) 787-0977
  þ o
  o o
  Large accelerated filer o
    
    Accelerated filer þ
    
    Non-accelerated filer o
    
    Smaller reporting company o
  o þ




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##### 



CONSOLIDATED GRAPHICS, INC.
 FORM 10-Q FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2010
 INDEX
 Part I  Financial Information
    
    
    3Item 1. Financial Statements
    
    
    3Condensed Consolidated Balance Sheets at September 30, 2010 and March 31, 2010
    
    
    3Condensed Consolidated Income Statements for the Three and Six Months Ended September 30, 2010 and 2009
    
    
    4Condensed Consolidated Statement of Shareholders Equity for the Six Months Ended September 30, 2010
    
    
    5Condensed Consolidated Statements of Cash Flows for the Six Months Ended September 30, 2010 and 2009
    
    
    6Notes to Condensed Consolidated Financial Statements
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    13Forward-Looking Statements
    
    
    20Item 3. Quantitative and Qualitative Disclosure About Market Risk
    
    
    20Item 4. Controls and Procedures
    
    
    20Part II  Other Information
    
    
    21Item 1. Legal Proceedings
    
    
    21Item 1A. Risk Factors
    
    
    21Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    21Item 3. Defaults upon Senior Securities
    
    
    21Item 4. Removed and Reserved
    
    
    21Item 5. Other Information
    
    
    21Item 6. Exhibits
    
    
    21Signatures
    
    
    22Exhibit Index
    
    
    23Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
   2




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PART I  FINANCIAL INFORMATION
 
 ITEM 1. Financial Statements
 CONSOLIDATED GRAPHICS, INC.
 
 CONDENSED CONSOLIDATED BALANCE SHEETS
 (In thousands, except share and per share data)
 (Unaudited)
 September 30,
    
    
    March 31,2010
    
    
    2010ASSETSCURRENT ASSETSCash and cash equivalents
    
    $
    5,913
    
    
    $
    6,741Accounts receivable, net
    
    
    174,652
    
    
    
    169,915Inventories
    
    
    55,622
    
    
    
    48,879Prepaid expenses
    
    
    15,096
    
    
    
    9,316Deferred income taxes
    
    
    12,362
    
    
    
    17,294Total current assets
    
    
    263,645
    
    
    
    252,145PROPERTY AND EQUIPMENT, net
    
    
    379,367
    
    
    
    380,708GOODWILL
    
    
    25,293
    
    
    
    24,226OTHER INTANGIBLE ASSETS, net
    
    
    20,794
    
    
    
    22,647OTHER ASSETS
    
    
    10,709
    
    
    
    7,509$
    699,808
    
    
    $
    687,235LIABILITIES AND SHAREHOLDERS EQUITYCURRENT LIABILITIESCurrent portion of long-term debt
    
    $
    19,032
    
    
    $
    22,235Accounts payable
    
    
    97,061
    
    
    
    83,955Accrued liabilities
    
    
    82,539
    
    
    
    88,174Income taxes payable
    
    
    
    
    
    
    9,417Total current liabilities
    
    
    198,632
    
    
    
    203,781LONG-TERM DEBT, net of current portion
    
    
    152,677
    
    
    
    159,321OTHER LIABILITIES
    
    
    16,038
    
    
    
    14,729DEFERRED INCOME TAXES, net
    
    
    39,160
    
    
    
    39,978Total liabilities
    
    
    406,507
    
    
    
    417,809COMMITMENTS AND CONTINGENCIESSHAREHOLDERS EQUITYCommon stock, $.01 par value;
100,000,000 shares authorized; 11,548,131
and 11,211,216 issued and outstanding
    
    
    115
    
    
    
    112Additional paid-in capital
    
    
    174,722
    
    
    
    166,094Retained earnings
    
    
    116,789
    
    
    
    101,894Accumulated other comprehensive income
    
    
    1,675
    
    
    
    1,326Total shareholders equity
    
    
    293,301
    
    
    
    269,426$
    699,808
    
    
    $
    687,235
   3




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##### Table of Contents



CONSOLIDATED GRAPHICS, INC.
 
 CONDENSED CONSOLIDATED INCOME STATEMENTS
 (In thousands, except per share data)
 (Unaudited)
 Three Months Ended
    
    
    Six Months EndedSeptember 30
    
    
    September 302010
    
    
    2009
    
    
    2010
    
    
    2009SALES
    
    $
    260,106
    
    
    $
    251,626
    
    
    $
    496,823
    
    
    $
    477,487COST OF SALES
    
    
    197,952
    
    
    
    196,183
    
    
    
    380,218
    
    
    
    377,215Gross profit
    
    
    62,154
    
    
    
    55,443
    
    
    
    116,605
    
    
    
    100,272SELLING EXPENSES
    
    
    22,300
    
    
    
    23,584
    
    
    
    45,607
    
    
    
    46,375GENERAL AND ADMINISTRATIVE EXPENSES
    
    
    23,682
    
    
    
    22,426
    
    
    
    46,098
    
    
    
    43,639LITIGATION AND OTHER CHARGES
    
    
    718
    
    
    
    2,633
    
    
    
    (3,466
    )
    
    
    2,633OTHER EXPENSE, net
    
    
    38
    
    
    
    218
    
    
    
    57
    
    
    
    164Operating income
    
    
    15,416
    
    
    
    6,582
    
    
    
    28,309
    
    
    
    7,461INTEREST EXPENSE, net
    
    
    2,096
    
    
    
    2,347
    
    
    
    4,099
    
    
    
    4,831Income before taxes
    
    
    13,320
    
    
    
    4,235
    
    
    
    24,210
    
    
    
    2,630INCOME TAXES
    
    
    5,266
    
    
    
    2,153
    
    
    
    9,315
    
    
    
    862Net income
    
    $
    8,054
    
    
    $
    2,082
    
    
    $
    14,895
    
    
    $
    1,768BASIC EARNINGS PER SHARE
    
    $
    0.70
    
    
    $
    0.19
    
    
    $
    1.30
    
    
    $
    0.16DILUTED EARNINGS PER SHARE
    
    $
    0.69
    
    
    $
    0.18
    
    
    $
    1.28
    
    
    $
    0.16SHARES USED TO COMPUTE EARNINGS
PER SHAREBasic
    
    
    11,547
    
    
    
    11,163
    
    
    
    11,437
    
    
    
    11,161Diluted
    
    
    11,742
    
    
    
    11,377
    
    
    
    11,635
    
    
    
    11,355
   4




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CONSOLIDATED GRAPHICS, INC.
 
 CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS EQUITY
 (In thousands)
 (Unaudited)
 AccumulatedAdditional
    
    
    
    
    
    
    OtherCommon Stock
    
    
    Paid-In
    
    
    Retained
    
    
    ComprehensiveShares
    
    
    Amount
    
    
    Capital
    
    
    Earnings
    
    
    Income
    
    
    TotalBALANCE, March 31, 2010
    
    
    11,211
    
    
    $
    112
    
    
    $
    166,094
    
    
    $
    101,894
    
    
    $
    1,326
    
    
    $
    269,426Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,895
    
    
    
    
    
    
    
    14,895Other comprehensive income 
currency translation adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    349
    
    
    
    349Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,244Exercise of stock options,
including excess tax benefit
    
    
    337
    
    
    
    3
    
    
    
    6,853
    
    
    
    
    
    
    
    
    
    
    
    6,856Share-based compensation expense
    
    
    
    
    
    
    
    
    
    
    1,775
    
    
    
    
    
    
    
    
    
    
    
    1,775BALANCE, September 30, 2010
    
    
    11,548
    
    
    $
    115
    
    
    $
    174,722
    
    
    $
    116,789
    
    
    $
    1,675
    
    
    $
    293,301
   5




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##### Table of Contents



CONSOLIDATED GRAPHICS, INC.
 
 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
 (In thousands)
 (Unaudited)
 Six Months EndedSeptember 302010
    
    
    2009OPERATING ACTIVITIESNet income
    
    $
    14,895
    
    
    $
    1,768Adjustments to reconcile net income to net cash provided by operating activitiesDepreciation
    
    
    32,409
    
    
    
    33,903Amortization
    
    
    1,781
    
    
    
    1,935Bad debt expense (recovery)
    
    
    252
    
    
    
    (417
    )Foreign currency gain
    
    
    (16
    )
    
    
    (287
    )Litigation and other charges
    
    
    (3,466
    )
    
    
    2,633Deferred income taxes
    
    
    4,624
    
    
    
    1,490Share-based compensation expense
    
    
    1,775
    
    
    
    2,753Changes in assets and liabilities, net of effects of acquisitionsAccounts receivable
    
    
    (2,898
    )
    
    
    4,250Inventories
    
    
    (5,671
    )
    
    
    93Prepaid expenses
    
    
    (5,780
    )
    
    
    4,452Other assets
    
    
    (2,949
    )
    
    
    561Accounts payable and accrued liabilities
    
    
    (6,219
    )
    
    
    42,602Other liabilities
    
    
    1,309
    
    
    
    1,045Income taxes payable
    
    
    (9,426
    )
    
    
    (377
    )Net cash provided by operating activities
    
    
    20,620
    
    
    
    96,404INVESTING ACTIVITIESAcquisitions
    
    
    (3,290
    )
    
    
    (750
    )Purchases of property and equipment
    
    
    (16,025
    )
    
    
    (11,380
    )Proceeds from asset dispositions
    
    
    2,651
    
    
    
    630Net cash used in investing activities
    
    
    (16,664
    )
    
    
    (11,500
    )FINANCING ACTIVITIESProceeds from bank credit facilities
    
    
    126,045
    
    
    
    55,480Payments on bank credit facilities
    
    
    (125,499
    )
    
    
    (119,009
    )Payments on term equipment notes and other debt
    
    
    (11,958
    )
    
    
    (20,308
    )Proceeds from exercise of stock options, including excess tax benefit
    
    
    6,856
    
    
    
    Net cash used in financing activities
    
    
    (4,556
    )
    
    
    (83,837
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    (228
    )
    
    
    218NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    (828
    )
    
    
    1,285CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
    
    
    6,741
    
    
    
    9,762CASH AND CASH EQUIVALENTS AT END OF PERIOD
    
    $
    5,913
    
    
    $
    11,047
   6




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CONSOLIDATED GRAPHICS, INC.
 
 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 (In thousands, except share and per share data and percentages)
 (Unaudited)
 1. BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES
  Use of Estimates
 Reclassification 
 Cash and Cash Equivalents
 Revenue Recognition and Accounts Receivable
  7




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CONSOLIDATED GRAPHICS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share data and percentages)
(Unaudited)
 Earnings Per Share
 Three Months Ended
    
    
    Six Months EndedSeptember 30
    
    
    September 302010
    
    
    2009
    
    
    2010
    
    
    2009Numerator:Net income
    
    $
    8,054
    
    
    $
    2,082
    
    
    $
    14,895
    
    
    $
    1,768Denominator:Weighted average number of common shares outstanding
    
    
    11,547,247
    
    
    
    11,162,667
    
    
    
    11,436,661
    
    
    
    11,161,035Dilutive options and stock awards
    
    
    194,895
    
    
    
    214,671
    
    
    
    198,390
    
    
    
    194,358Diluted weighted average number of common shares
outstanding
    
    
    11,742,142
    
    
    
    11,377,388
    
    
    
    11,635,051
    
    
    
    11,355,393Net earnings per shareBasic
    
    $
    0.70
    
    
    $
    0.19
    
    
    $
    1.30
    
    
    $
    0.16Diluted
    
    $
    0.69
    
    
    $
    0.18
    
    
    $
    1.28
    
    
    $
    0.16
  Inventories
 September 30,
    
    
    March 31,2010
    
    
    2010Raw materials
    
    $
    23,787
    
    
    $
    20,932Work in progress
    
    
    26,263
    
    
    
    22,354Finished goods
    
    
    5,572
    
    
    
    5,593$
    55,622
    
    
    $
    48,879
 Goodwill and Long-Lived Assets
  8




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CONSOLIDATED GRAPHICS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share data and percentages)
(Unaudited)
    Supplemental Cash Flow Information
 Fair Value of Financial Instruments
 Foreign Currency 
 Accumulated Other Comprehensive Income 
  9




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CONSOLIDATED GRAPHICS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share data and percentages)
(Unaudited)
 Geographic Information
 2. ACQUISITIONS
  3. LONG  TERM DEBT
  September 30,
    
    
    March 31,2010
    
    
    2010Bank credit facilities
    
    $
    113,332
    
    
    $
    113,186Term equipment notes
    
    
    52,641
    
    
    
    64,612Other
    
    
    5,736
    
    
    
    3,758171,709
    
    
    
    181,556Lesscurrent portion
    
    
    (19,032
    )
    
    
    (22,235
    )$
    152,677
    
    
    $
    159,321
     10




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CONSOLIDATED GRAPHICS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share data and percentages)
(Unaudited)
      4. SHARE  BASED COMPENSATION
   11




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CONSOLIDATED GRAPHICS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands, except share and per share data and percentages)
(Unaudited)
  Weighted-AverageStock Options
    
    Shares
    
    
    Exercise PriceOutstanding at March 31, 2010
    
    
    1,798,237
    
    
    $
    37.61Granted
    
    
    15,000
    
    
    
    42.62Exercised
    
    
    (318,791
    )
    
    
    12.74Forfeited or expired
    
    
    (7,464
    )
    
    
    44.88Outstanding at September 30, 2010 (a)
    
    
    1,486,982
    
    
    $
    42.96Exercisable at September 30, 2010 (a)
    
    
    911,310
    
    
    $
    43.90
 
 (a)
    
    Stock options outstanding as of September 30, 2010 have a weighted average
remaining contractual
life of 6.1 years. Based on the market value of the Companys common stock on
September 30, 2010, outstanding stock options have an aggregate intrinsic value
of $9,615 and exercisable stock options have an aggregate intrinsic value of
$4,627.  Restricted Stock Unit Awards
    
    SharesOutstanding at March 31, 2010
    
    
    44,583Granted
    
    
    12,500Vested and issued
    
    
    (18,124
    )Forfeited or expired
    
    
    Outstanding at September 30, 2010 (a)
    
    
    38,959
 
 (a)
    
    Restricted stock units outstanding as of September 30, 2010 have a weighted
average remaining
contractual term of 1.1 years and a total intrinsic value of $1,615.   12




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ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
 The following managements discussion and analysis of financial condition and results of
operations should be read in conjunction with our unaudited condensed consolidated financial
statements and notes to unaudited condensed consolidated financial statements in this Quarterly
Report on Form 10-Q and our audited financial statements and notes thereto included in our Annual
Report on Form 10-K as of and for the year ended March 31, 2010. This discussion contains
forward-looking statements that reflect our current views with respect to future events and
financial performance. Our actual results may differ materially from those anticipated in these
forward-looking statements as a result of certain factors such as those referenced in the section
entitled Forward-Looking Statements below.
 Overview
 Our Organization
   Nature of Our Services
      13




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Our Strategy
  
    
    Internal Sales GrowthWe seek to use our competitive advantages to expand
market share. We continually seek to hire additional sales professionals, invest in new
equipment and technology, expand our national accounts program, develop new and
expanded digital technology-based print-related services and provide sales training and
education about our breadth of capabilities and services to our sales professionals.
 
    
    Disciplined Acquisition ProgramWe selectively pursue opportunities to acquire
additional printing businesses at reasonable prices. Some of these acquisitions may
include smaller and/or distressed printing businesses for integration into one of our
existing businesses.
 
    
    Cost SavingsBecause of our size and extensive geographic footprint, we
leverage our economies of scale to purchase supplies and equipment at preferential
prices, and centralize various administrative services to generate cost savings.
 
    
    Best Practices/BenchmarkingWe provide a forum for our printing businesses to
share their knowledge of technical processes and their best practices with one another,
as well as benchmark financial and operational data to help our printing businesses
identify and respond to changes in operating trends.
 
    
    Leadership DevelopmentThrough our unique Leadership Development Program, we
develop talent for future sales and management positions at our printing businesses.
 Results of Operations
  Three Months
    
    
    Six MonthsEnded September 30
    
    
    Ended September 302010
    
    
    2009
    
    
    2010
    
    
    2009(In millions)
    
    
    (In millions)Sales
    
    $
    260.1
    
    
    $
    251.6
    
    
    $
    496.8
    
    
    $
    477.5Cost of sales
    
    
    198.0
    
    
    
    196.2
    
    
    
    380.2
    
    
    
    377.2Gross profit
    
    
    62.1
    
    
    
    55.4
    
    
    
    116.6
    
    
    
    100.3Selling expenses
    
    
    22.3
    
    
    
    23.6
    
    
    
    45.6
    
    
    
    46.4General and administrative expenses
    
    
    23.7
    
    
    
    22.4
    
    
    
    46.2
    
    
    
    43.6Litigation and other charges
    
    
    0.7
    
    
    
    2.6
    
    
    
    (3.5
    )
    
    
    2.6Other expense, net
    
    
    
    
    
    
    0.2
    
    
    
    
    
    
    
    0.2Operating income
    
    
    15.4
    
    
    
    6.6
    
    
    
    28.3
    
    
    
    7.5Interest expense, net
    
    
    2.1
    
    
    
    2.4
    
    
    
    4.1
    
    
    
    4.8Income before taxes
    
    
    13.3
    
    
    
    4.2
    
    
    
    24.2
    
    
    
    2.7Income taxes
    
    
    5.2
    
    
    
    2.1
    
    
    
    9.3
    
    
    
    0.9Net income
    
    $
    8.1
    
    
    $
    2.1
    
    
    $
    14.9
    
    
    $
    1.8
  14




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As a Percentage
    
    
    As a Percentageof Sales
    
    
    of SalesThree Months
    
    
    Six MonthsEnded September 30
    
    
    Ended September 302010
    
    
    2009
    
    
    2010
    
    
    2009Sales
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %
    
    
    100.0
    %Cost of sales
    
    
    76.1
    
    
    
    78.0
    
    
    
    76.5
    
    
    
    79.0Gross profit
    
    
    23.9
    
    
    
    22.0
    
    
    
    23.5
    
    
    
    21.0Selling expenses
    
    
    8.6
    
    
    
    9.4
    
    
    
    9.2
    
    
    
    9.7General and administrative expenses
    
    
    9.1
    
    
    
    8.9
    
    
    
    9.3
    
    
    
    9.1Litigation and other charges
    
    
    0.3
    
    
    
    1.1
    
    
    
    (0.7
    )
    
    
    0.6Other expense, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Operating income
    
    
    5.9
    
    
    
    2.6
    
    
    
    5.7
    
    
    
    1.6Interest expense, net
    
    
    0.8
    
    
    
    0.9
    
    
    
    0.8
    
    
    
    1.0Income before taxes
    
    
    5.1
    
    
    
    1.7
    
    
    
    4.9
    
    
    
    0.6Income taxes
    
    
    2.0
    
    
    
    0.9
    
    
    
    1.9
    
    
    
    0.2Net income
    
    
    3.1
    %
    
    
    0.8
    %
    
    
    3.0
    %
    
    
    0.4
    %
 Comparative Analysis of Consolidated Income Statements for the Three Months Ended September 30,
2010 and 2009
         Comparative Analysis of Consolidated Income Statements for the Six Months Ended September 30, 2010
and 2009
   15




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Liquidity and Capital Resources
 Sources and Uses of Cash
 :
 Six Months EndedSeptember 302010
    
    
    2009(In millions)Net cash provided by operating activities
    
    $
    20.6
    
    
    $
    96.4Acquisitions
    
    
    (3.3
    )
    
    
    (0.8
    )Capital expenditures, net of proceeds from asset dispositions
    
    
    (13.4
    )
    
    
    (10.8
    )Net payments under bank credit facilities
    
    
    0.5
    
    
    
    (63.5
    )Net payments on term equipment notes and other debt
    
    
    (12.0
    )
    
    
    (20.3
    )Proceeds from exercise of stock options
    
    
    6.9
    
    
    
    
  16




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##### Table of Contents



:
 September 30,
    
    
    March 31,2010
    
    
    2010(In millions)Cash and cash equivalents
    
    $
    5.9
    
    
    $
    6.7Working capital
    
    
    65.0
    
    
    
    48.4Total debt
    
    
    171.7
    
    
    
    181.6
    Debt Obligations
     17




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##### Table of Contents



Commitment and Contingencies
 Operating leases
 Letters of credit
 Insurance programs
 Critical Accounting Policies
   18




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##### Table of Contents



Revenue recognition
 Receivables, net of valuation allowance 
 Impairment of goodwill 
 Impairment of long-lived assets
 Insurance liabilities
 Accounting for income taxes
 Accounting for acquisitions
  19




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##### Table of Contents



Forward-Looking Statements
 This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, in which the Company discusses factors it believes may affect its
performance or results in the future. Forward-looking statements are all statements other than
historical facts, such as statements regarding assumptions, expectations, beliefs and projections
about future events or conditions. You can generally identify forward-looking statements by the
appearance in such a statement of words like anticipate, believe, continue, could,
estimate, expect, intend, may, might, plan, potential, predict, forecast,
project, should or will or other comparable words or the negative of such words. The accuracy
of the Companys assumptions, expectations, beliefs and projections depends on events or conditions
that change over time and are thus susceptible to change based on actual experience, new
developments and known and unknown risks, including those created by general market conditions,
competition and the possibility that events may occur beyond the Companys control, which may limit
its ability to maintain or improve its operating results or financial condition or acquire
additional printing businesses. The Company gives no assurance that the forward-looking statements
will prove to be correct and does not undertake any duty to update them. The Companys actual
future results might differ from the forward-looking statements made in this Quarterly Report on
Form 10-Q for a variety of reasons, which include, continuing weakness in the economy, financial
stability of its customers, the sustained growth of its digital printing business, seasonality of
election-related business, its ability to adequately manage business expenses, including labor
costs, the unfavorable outcome of legal proceedings, the lack of or adequacy of insurance coverage
for its operations, the continued availability of raw materials at affordable prices, retention of
its key management and operating personnel, satisfactory labor relations, the potential for
additional goodwill impairment charges, its ability to identify new acquisition opportunities,
negotiate and finance such acquisitions on acceptable terms and successfully absorb and manage such
acquisitions in a timely and efficient manner, as well as other risks described under the heading
Risk Factors of our Annual Report on 10-K and the risk factors and cautionary statements
described in the other documents the Company files or furnishes from time to time with the
Securities and Exchange Commission, including its Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K . Should one or more of the foregoing risks or uncertainties materialize, or
should the Companys underlying assumptions, expectations, beliefs or projections prove incorrect,
the Companys actual results may vary materially from those anticipated in its forward-looking
statements, and its business, financial condition and results of operations could be materially and
adversely affected.
 
 ITEM 3. Quantitative and Qualitative Disclosure About Market Risk
  
 ITEM 4. Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Changes in Internal Control Over Financial Reporting
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##### Table of Contents



CONSOLIDATED GRAPHICS, INC.
 
 PART II  OTHER INFORMATION
 
 ITEM 1. Legal Proceedings
  
 ITEM 1A. Risk Factors
  
 ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 ITEM 3. Defaults upon Senior Securities
  
 ITEM 4. Removed and Reserved
  
 ITEM 5. Other Information
 .
 
 ITEM 6. Exhibits
 *
    10.1
    
    
    Credit Agreement dated August 20, 2010, between Consolidated
Graphics, Inc., JP Morgan Chase Bank, N.A., as administrative agent,
J.P. Morgan Securities, Inc., as co-lead arranger and sole book
runner, Wells Fargo Bank, N.A., a syndication agent and co-lead
arranger, and the lenders and guarantors party thereto (Consolidated
Graphics, Inc. Form 8-K (August 20, 2010), Exhibit 10.1).31.1
    
    
    Certification of Joe R. Davis, principal executive officer, pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Jon C. Biro, principal financial and accounting
officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of Joe R. Davis, principal executive officer, pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of Jon C. Biro, principal financial and accounting
officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Incorporated by reference.  21




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##### Table of Contents



SIGNATURES
 Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant,
Consolidated Graphics, Inc., has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
 CONSOLIDATED GRAPHICS, INC.Dated:  November 3, 2010
    By:
    /s/ Jon C. BiroJon C. BiroExecutive Vice President and
Chief Financial and Accounting Officer  22




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##### Table of Contents



Exhibit Index
 *
    10.1
    
    
    Credit Agreement dated August 20, 2010, between Consolidated
Graphics, Inc., JP Morgan Chase Bank, N.A., as administrative agent,
J.P. Morgan Securities, Inc., as co-lead arranger and sole book
runner, Wells Fargo Bank, N.A., a syndication agent and co-lead
arranger, and the lenders and guarantors party thereto (Consolidated
Graphics, Inc. Form 8-K (August 20, 2010), Exhibit 10.1).31.1
    
    
    Certification of Joe R. Davis, principal executive officer, pursuant
to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Jon C. Biro, principal financial and accounting
officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of Joe R. Davis, principal executive officer, pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of Jon C. Biro, principal financial and accounting
officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 *
    
    Incorporated by reference.  23