XML 21 R14.htm IDEA: XBRL DOCUMENT
v3.24.3

Acquisitions | 6 Months Ended
--- | ---
Aug. 31, 2024
Business Combinations [Abstract] |
Acquisitions | 6. Acquisitions The Company applies the acquisition method of accounting for business combinations. Under the acquisition method, the acquiring entity in a business combination recognizes 100% of the assets acquired and liabilities assumed at their acquisition date fair values with certain limited exceptions permitted under US GAAP. Management utilizes valuation techniques appropriate for the asset or liability being measured in determining these fair values. Any excess of the purchase price over amounts allocated to assets acquired, including identifiable intangible assets and liabilities assumed, is recorded as goodwill. Where amounts allocated to assets acquired and liabilities assumed is greater than the purchase price, a bargain purchase gain is recognized. Acquisition-related costs are expensed in the period incurred. Acquisition of Printing Technologies On June 26, 2024, the Company acquired the assets and business of Printing Technologies, Inc. ("PTI"), which is based in Indianapolis, Indiana, for approximately $5.6 million in cash. The Company performed a preliminary allocation of the total estimated consideration and recorded the underlying assets acquired (including certain identified intangible assets) and liabilities assumed based on the estimated fair values using the information available as of the acquisition date. The Company recorded intangible assets with definite lives of approximately $2.0 million in connection with the transaction, which are deductible for tax purposes. This allocation is preliminary and subject to change, which may be material. The acquisition of PTI strengthens our production capabilities and diversifies our product offerings to enable us to better serve our broad customer base. The following table summarizes the Company's preliminary purchase price allocation for PTI as of the acquisition date (in thousands):
Accounts receivable |  | $1,336
Inventories |  | 1,932
Other assets |  | 100
Right-of-use asset |  | 847
Property, plant and equipment |  | 887
Intangibles |  | 2,012
Operating lease liability |  | (847)
Accounts payable and accrued liabilities |  | (645)
Acquisition price |  | $5,622
Acquisition of Eagle Graphics and Diamond Graphics On October 11, 2023, the Company acquired the assets and business of Eagle Graphics, Inc. ("Eagle"), which is based in Annville, Pennsylvania, and Diamond Graphics, Inc. ("Diamond"), which is based in Bensalem, Pennsylvania, for approximately $7.9 million in cash. The Company performed an allocation of the total estimated consideration and recorded the underlying assets acquired (including certain identified intangible assets) and liabilities assumed based on the estimated fair values prepared by management using the information available as of the acquisition date. All goodwill of $0.2 million recognized as a part of this acquisition is deductible for tax purposes. The Company also recorded intangible assets with definite lives of approximately $0.8 million in connection with the transaction, which are also deductible for tax purposes. The acquisition of Eagle and Diamond strengthens our production capabilities to serve our customers in the Northeast United States. The following table summarizes the Company's purchase price allocation for Eagle and Diamond as of the acquisition date (in thousands):
Accounts receivable |  | $838
Inventories |  | 917
Property, plant and equipment |  | 5,304
Goodwill and intangibles |  | 971
Accounts payable and accrued liabilities |  | (159)
Acquisition price |  | $7,871
Acquisition of UMC Print On June 2, 2023, the Company acquired the assets and business of UMC Print ("UMC"), which is based in Overland Park, Kansas, for approximately $7.5 million in cash plus the assumption of trade payables of approximately $0.8 million. The Company performed an allocation of the total estimated consideration and recorded the underlying assets acquired (including certain identified intangible assets) and liabilities assumed based on the estimated fair values prepared by management using the information available as of the acquisition date. In January 2024, the Company received an indemnity claim from escrow related to a piece of equipment in the amount of $0.2 million. All goodwill of $0.2 million recognized as a part of this acquisition is deductible for tax purposes. The Company also recorded intangible assets with definite lives of approximately $2.7 million in connection with the transaction, which are also deductible for tax purposes. The acquisition of UMC brings the Company expanded commercial print capabilities serving customers throughout the Midwest United States. The following table summarizes the Company's purchase price allocation for UMC as of the acquisition date (in thousands):
Cash |  | $758
Accounts receivable |  | 1,839
Inventories |  | 553
Property, plant and equipment |  | 2,137
Goodwill and intangibles |  | 2,971
Accounts payable and accrued liabilities |  | (789)
Acquisition price |  | $7,469
Acquisition of Stylecraft Printing On May 23, 2023, the Company acquired the real estate and operations of Stylecraft Printing Company ("Stylecraft"), which is based in Canton, Michigan, for $5.0 million plus the assumption of trade payables. The Company performed an allocation of the total estimated consideration and recorded the underlying assets acquired (including certain identified intangible assets) and liabilities assumed based on their estimated fair values using the information available as of the acquisition date. All goodwill of $0.2 million recognized as a part of this acquisition is deductible for tax purposes. The Company also recorded intangible assets with definite lives of approximately $0.3 million in connection with the transaction, which are also deductible for tax purposes. The acquisition of Stylecraft expands the Company's product lines and footprint specializing in business forms, integrated products and commercial printing. The following table summarizes the Company's purchase price allocation for Stylecraft as of the acquisition date (in thousands):
Accounts receivable |  | $554
Inventories |  | 849
Right-of-use asset |  | 28
Property, plant and equipment |  | 3,160
Goodwill and intangibles |  | 476
Operating lease liability |  | (28)
Accounts payable and accrued liabilities |  | (12)
Acquisition price |  | $5,027
The results of operations for Stylecraft, UMC, Eagle and PTI are included in the Company’s consolidated financial statements from the respective dates of acquisition. The following table sets forth certain operating information on a pro forma basis as though each acquisition had occurred as of the beginning of the comparable prior period (that is, March 1, 2023). The following pro forma information includes the estimated impact of adjustments such as amortization of intangible assets, depreciation expense and interest expense and related tax effects (in thousands, except per share amounts).
|  | Three months ended |  | Six months ended
|  | August 31, 2024 |  | August 31, 2023 |  | August 31, 2024 |  | August 31, 2023
Pro forma net sales |  | $100,204 |  | $112,646 |  | $206,811 |  | $235,437
Pro forma net earnings |  | 10,335 |  | 11,415 |  | 21,101 |  | 24,469
Pro forma earnings per share - diluted |  | $0.40 |  | $0.44 |  | $0.81 |  | $0.94
The pro forma results are not necessarily indicative of what would have occurred if the acquisitions had been in effect for the full duration of the comparative periods presented.

X
- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 805 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 5 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479907/805-20-50-5 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 805 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/805/tableOfContent + Details
Name: | us-gaap_BusinessCombinationDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_BusinessCombinationsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration