American Greetings Corp. (AM: Quote) said its first-quarter profit was down to $7.25 million or $0.20 per share from last year's $32.59 million or $0.78 per share.
Total revenue dropped to $393.11 million from $403.7 million in the prior-year quarter. The company noted that the lower revenue was due to scan-based trading conversions that occurred during the quarter.
Chief Executive Officer Zev Weiss said, "I am pleased with the overall performance of our core business in the first fiscal quarter, holding aside the impact of Clinton Cards...Our justWink mobile application recently surpassed the one million downloads milestone, showing how we are setting the pace when it comes to connecting the digital and paper worlds for greeting cards."
"This quarter, we also had our most successful customer acquisition campaign for Cardstore.com, driven by a heavy push for new customers tied to the Mother's Day holiday..."
During the first quarter, on May 9, 2012, the company announced the acquisition for approximately $56.6 million of the senior secured debt of Clinton Cards Plc. Subsequently, Clinton Cards was placed into administration, a procedure similar to Chapter 11 bankruptcy in the United States, which gives the company, under the control of its administrators, an opportunity to restructure its business.
American Greetings subsequently announced, on June 7, 2012, the acquisition of assets of Clinton Cards, including approximately 400 stores and related overhead as well as the Clinton Cards and related brands. The impacts of this transaction will be reflected in the second quarter of fiscal 2013.
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by RTT Staff Writer
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