American Greetings announces fourth quarter results

For the fourth quarter of fiscal 2009, the Company reported total revenue of $422.5 million, a pre-tax loss from continuing operations of $67.9 million, and a loss from continuing operations of $50.1 million or $1.13 per share (all per-share amounts assume dilution). For the fourth quarter of fiscal 2008, the Company reported total revenue of $493.2 million, pre-tax income from continuing operations of $12.7 million, and income from continuing operations of $15.6 million or 31 cents per share.

During the fourth quarter of fiscal 2009, the Company recognized non-cash pre-tax goodwill impairment charges of $47.3 million (after-tax of approximately $42.6 million) that reduced earnings per share by 97 cents during the quarter.

In addition, the Company recognized expenses in its licensing business primarily due to changes in market conditions that caused a change in ultimate revenues related to animated video productions of $16.4 million (after-tax of approximately $10.0 million) that reduced earnings per share by 23 cents during the quarter.

The Company recorded a non-cash pre-tax long-lived asset impairment charge within the Retail Operations segment of $1.5 million (after-tax of approximately $0.9 million) that reduced earnings per share by 2 cents during the quarter.

The Company also announced on December 9, 2008, the elimination of approximately 275 positions as part of a cost reduction effort. As a result of those and other position eliminations during the quarter, the Company recognized a pre-tax severance charge of $7.5 million (after-tax of approximately $4.6 million) that reduced earnings per share by 10 cents.

Chief Executive Officer Zev Weiss said, "This fiscal year we faced a challenging retail environment as a result of the steep economic downturn. We will continue to be even more vigilant in managing our supply chain and becoming more cost efficient. Our focus on efficiency, we believe, will help us drive a substantial improvement in cash flow next year and we are projecting cash flow from operating activities less capital expenditures to be at least $70 million. We are also excited about the recent acquisitions of Recycled Paper Greetings and the Papyrus brand, and satisfied that the sale of our Carlton Retail stores best positions our Company and those stores for success."

Under the Company’s $75 million share repurchase program, during the fourth quarter the Company purchased approximately 4.9 million shares of its common stock for $24.2 million