American Greetings Lifts 2Q Profit 70%, But Warns of Headaches

By Features FOXBusiness

American Greetings (AM) revealed on Tuesday a stronger-than-expected second-quarter profit on higher sales of greeting cards in North America, though the company warned it is more cautious about the economy now than it was just six months ago.

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The Cleveland, Ohio-based maker of greeting cards, gift wrap and party goods, posted net income of $14.5 million, or 35 cents a share, compared with $8.5 million, or 21 cents a share, in the same quarter last year.

The results were ahead of average analyst estimates polled by Thomson Reuters of 25 cents. Revenue for the three months ended Aug. 26 was $368.8 million, up $342.8 million a year ago, beating the Street’s view of $351 million.

The improved performance was led by its largest segment by revenues, North American social expression products, which grew 4% to $262.9 million, followed by its international social expression products segment, which climbed 39% to $75.89 million.

“I am very pleased with our innovative new products and revenue growth this quarter, which resulted in market share gains both domestically and internationally,” American Greetings CEO Zev Weiss said in a statement.

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As the company looks ahead, Weiss said American Greetings is “certainly more cautious” than it was at the beginning of the year about the global economy and the effect it is having on the consumer.

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However, while the uncertainties could create earnings volatility during the second half of the year, Weiss said the company continues to take steps to solidify its product leadership and build long-term goals.

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