BROOKLYN, Ohio – American Greetings Corp. (AM), the nation's second-largest maker of cards, said Tuesday its profit skidded 56 percent lower in the fourth quarter, citing slow sales and a plant closing. It also said earnings for the current quarter and full fiscal year would be below Wall Street's expectations. Its shares fell nearly 4 percent.
The company, based in suburban Cleveland, reported income of $21.4 million, or 28 cents a share, for the three months ended Feb, 28, down from $48.3 million, or 62 cents a share, a year ago.
The most recent earnings included a $6.4 million charge related to the plant closure, and $34.7 million in other one-time charges.
Analysts surveyed by Thomson First Call expected fourth-quarter earnings of 47 cents a share before charges.
Sales fell 5 percent to $490.9 million from $518.2 million a year ago.
Full year earnings were $95.3 million, or $1.25 a share, down from $104.7 million, or $1.40 a share, a year ago. Annual revenue slipped to $1.9 billion from $1.95 billion a year ago.
Looking ahead, American Greetings forecast first-quarter earnings per share between 25 cents and 30 cents, and expects revenue from continuing operations to be flat to up slightly from the year-ago period. For fiscal year 2006, it forecast earnings per share between $1.46 and $1.51, on a 1 percent increase in revenue.
Wall Street's estimates are currently 35 cents per share for the current quarter, and $1.83 for the year.
It also said its board has authorized the repurchase of up to $200 million of class A common shares over the next 12 months and approved a 33 percent increase in the quarterly dividend to 8 cents from 6 cents, with the new rate payable May 5 to shareholders of record April 25.
The company with 20,000 employees sells cards and other products under brand names American Greetings, Carlton Cards (search) and Gibson. It owns and operates about 600 card and gift shops throughout North America, and sells cards through retailers such as Wal-Mart and Target.
American Greeting stock fell 97 cents, or 3.9 percent, to $24.13 on the New York Stock Exchange (search). The company's stock has ranged between $19.09 and $28.16 in the past year.