CSS Industries, Inc. Reports Results Of Operations For The Quarter And Year Ended March 31, 2011; Announces Closure Of A Manufacturing Facility

CSS Industries, Inc. (NYSE:CSS) announced today its results of operations for the quarter and year ended March 31, 2011. Sales for the fourth quarter of fiscal 2011 increased 20% to $62,846,000 from $52,270,000 in fiscal 2010. In the fourth quarter of fiscal 2011, the Company recorded a non-cash pre-tax impairment charge of $11,051,000 primarily due to a full impairment of the tangible assets relating to our Cleo manufacturing facility located in Memphis, Tennessee, as further discussed below. The foregoing impairment charge was partially offset by a $3,965,000 tax benefit. The fourth quarter fiscal 2011 net loss was $9,972,000, or $(1.02) per share. The impact of the impairment charge, net of the associated tax benefit, in the fourth quarter of fiscal 2011 was $(0.73) per share. In the fourth quarter of fiscal 2010, the Company recorded a non-cash pre-tax impairment charge of $44,315,000 due to a full impairment of goodwill in two of its reporting units, C.R. Gibson, LLC and BOC Design Group (consisting of Berwick Offray LLC and Cleo Inc), and partial impairments of tradenames used by such entities. The fiscal 2010 impairment charge was partially offset by an $11,692,000 tax benefit, resulting in a net loss of $40,841,000, or $(4.22) per share. The impact of the impairment charge, net of the associated tax benefit, in the fourth quarter of fiscal 2010 was $(3.37) per share. Excluding the non-cash impairments, net of tax benefit, in each of the fourth quarters of fiscal 2011 and fiscal 2010, net loss per share in the fourth quarter of fiscal 2011 would have been $(0.30) per share versus a net loss of $(0.85) per share in the fourth quarter of fiscal 2010. The Company’s highly seasonal orientation has historically resulted in operating losses in the first and fourth quarters of the fiscal year and operating profits in the second and third quarters.

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