CONSOLIDATED GRAPHICS INC /TX/
8-K, 1998-01-29
COMMERCIAL PRINTING
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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                            ------------------------

                                    FORM 8-K

                                 CURRENT REPORT

     PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

         DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): January 28, 1998

                           CONSOLIDATED GRAPHICS, INC.
             (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

         TEXAS                         0-24068               76-0190827
(STATE OR OTHER JURISDICTION   (COMMISSION FILE NUMBER)   (I.R.S. EMPLOYER
      OF INCORPORATION)                                   IDENTIFICATION NO.)

                           5858 WESTHEIMER, SUITE 200
                              HOUSTON, TEXAS 77057
              (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND ZIP CODE)

       REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (713) 787-0977
         2210 WEST DALLAS STREET, HOUSTON, TEXAS 77019 - (713) 529-4200
                      (FORMER ADDRESS AND TELEPHONE NUMBER)
 =============================================================================
<PAGE>
ITEM 5.  OTHER EVENTS

     On January 28, 1998, Consolidated Graphics, Inc. (the "Company")
announced its fiscal 1998 third quarter results.  A copy of the press
release is attached hereto as Exhibit 99.1.

     On January 28, 1998, the Company announced the completion of the
acquisitions of StorterChilds Printing Company of Gainesville, Florida and Heath
Printers of Seattle, Washington. A copy of the press release is attached hereto
as Exhibit 99.2.

     The attached press releases may contain forward looking information.
Readers are cautioned that such information involves risks and uncertainties,
including the possibility that events may occur which would prevent the Company
from achieving comparable financial results in the future or completing its
pending or future acquisitions.

ITEM 7.  FINANCIAL STATEMENTS AND EXHIBIT

     (A)  EXHIBITS

     The following exhibits are filed herewith:

          99.1  Press release of Consolidated Graphics, Inc. dated January 28,
                1998, with respect to the announcement of the Company's fiscal
                1998 third quarter results.

          99.2  Press release of Consolidated Graphics, Inc. dated January 28,
                1998, with respect to the announcement of the completion of the
                acquisitions of StorterChilds Printing Company of Gainesville,
                Florida and Heath Printers of
                Seattle, Washington.

                                        1
<PAGE>
                                    SIGNATURE

     PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED HEREUNTO DULY AUTHORIZED.

                                           CONSOLIDATED GRAPHICS, INC.
                                                 (Registrant)

                                           By:/s/HAROLD E. GAUBERT, JR.
                                                 HAROLD E. GAUBERT, JR.
                                           EXECUTIVE VICE PRESIDENT -
                                           FINANCE AND ADMINISTRATION

Date:  January 28, 1998

                                        2


                                                                    EXHIBIT 99.1

                                          FOR:  Consolidated Graphics, Inc.

                                  APPROVED BY:  Ronald E. Hale, Jr.
                                                Vice President & Treasurer
                                                (713) 787-0977

                                      CONTACT:  Betsy Brod/Nancy Healy
                                                Media:  Stan Froelich
                                                Morgen-Walke Associates, Inc.
                                                (212) 850-5600


FOR IMMEDIATE RELEASE

                       CONSOLIDATED GRAPHICS, INC, REPORTS
                          RECORD THIRD QUARTER RESULTS

- -- Net Income Rises 74% in Seventh Consecutive Quarter of Record Financial
Performance --

     HOUSTON, TEXAS - January 28, 1998 - Consolidated Graphics, Inc. (NYSE:CGX)
today announced record results for the third quarter ended December 31, 1997.

     Net income for the third quarter grew 74% to $4.9 million compared to the
same period in 1997. Operating income for the three months rose 74% to $8.8
million on a 60% increase in revenues to $61.0 million. On a per share basis,
diluted earnings increased 68% to $.37 this quarter, compared to $.22 last year
and basic earnings per share increased 65% to $.38, up from $.23 a year ago.

     For the nine months ended December 31, 1997, Consolidated Graphics' net
income grew 89% to $13.0 million. Operating income increased 89% to $23.6
million and sales increased to $165 million, an increase of 64% over the prior
year. Diluted earnings per share for the period increased to $1.00, up 79% from
the $.56 reported last year. Basic earnings per share increased 82% to $1.04 as
compared to $.57 per share a year ago.

     Joe R. Davis, Chairman and Chief Executive Officer of Consolidated
Graphics, commented, "We are pleased to report our seventh consecutive quarter
of record financial performance as we maintain our commitment to strong,
profitable growth, through both internally generated market share expansion and
acquisitions. Our acquisition program has accelerated significantly during the
past three months. We increased our market penetration in three key markets, Los
Angeles, Seattle and Colorado. We also expanded our presence into three new
markets: New England through our acquisition of the The Otto Companies, Central
Florida through StorterChilds Printing and Middle Tennessee with Courier
Printing Company. Our acquisition pipeline continues to strengthen, as does our
leadership position in the industry. Today, we have over $290 million in
annualized revenues, a 65% increase since the beginning of our fiscal year, and
we are in acquisition discussions with companies representing over $300 million
in revenues.
                                  - more-
<PAGE>
     Commenting on the quarterly results, Davis continued, "Our strong operating
margin this quarter demonstrates the operating efficiencies our companies
realize as they capitalize on increased purchasing power and our investment in
technology and equipment. Overall, we continue to do very well and expect this
performance to continue.

     Consolidated Graphics, Inc., is the fastest growing printing company in the
United States. A consolidator in a highly fragmented industry, the Company adds
value to its acquisitions through managerial and operational expertise,
financial strength and economies of scale. Upon completion of pending
acquisitions, Consolidated Graphics will have 31 companies with annualized
revenues in excess of $290 million.

     This press release contains forward-looking statements which involve known
and unknown risks, uncertainties or other factors that could cause actual
results to materially differ from the results, performance or other expectations
implied by these forward-looking statements. Consolidated Graphics' expectations
regarding run-rate revenues assume, among other things, completion of pending
acquisitions that are subject to the execution of definitive agreements, general
economic conditions, continued demand for its product, the availability of raw
materials at affordable prices, retention of its key management and operating
personnel, as well as other factors detailed in Consolidated Graphics' filings
with the Securities and Exchange Commission

                            --Table to Follow---
<PAGE>
                           CONSOLIDATED GRAPHICS, INC.
                                   (NYSE: CGX)
                              Financial Highlights
                    (in thousands, except per share amounts)


                                         Quarter Ended         Nine Months Ended
                                         December 31,           December 31,
                                       1997        1996        1997        1996
Sales                              $ 60,977    $ 38,186    $165,015    $100,895
Cost of Sales                        41,626      26,391     112,856      70,421
  GROSS PROFIT                       19,351      11,795      52,159      30,474
Selling Expense                       5,881       3,754      15,972      10,012
General and Administrative Expense    4,622       2,966      12,568       7,980
  OPERATING INCOME                    8,848       5,075      23,619      12,482
Interest Expense                        996         643       2,644       1,577
  Pretax Income                       7,852       4,432      20,975      10,905
Income Taxes                          2,984       1,640       7,972       4,008
  NET INCOME                        $ 4,868     $ 2,792     $13,003     $ 6,897

Basic Earnings Per Share              $ .38       $ .23      $ 1.04       $ .57

Diluted Earnings Per Share            $ .37       $ .22      $ 1.00       $ .56


Weighted Average Shares Outstanding

   Basic                             12,682      12,273      12,552      12,082

   Diluted                           13,205      12,730      13,035      12,234


                                                                    EXHIBIT 99.2

                                            FOR:  Consolidated Graphics, Inc.

                                    APPROVED BY:  Ronald E. Hale, Jr.
                                                  Vice President & Treasurer
                                                  (713) 787-0977

                                        CONTACT:  Betsy Brod/Nancy Healy
                                                  Media:  Stan Froelich
                                                  Morgen-Walke Associates, Inc.
                                                  (212) 850-5600

FOR IMMEDIATE RELEASE

               CONSOLIDATED GRAPHICS, INC. ANNOUNCES COMPLETION OF
             STORTERCHILDS PRINTING AND HEATH PRINTERS ACQUISITIONS

     HOUSTON, TEXAS - January 28, 1998 - Consolidated Graphics, Inc. (NYSE: CGX)
today announced that it has completed the previously announced acquisitions of
StorterChilds Printing Company of Gainesville, Florida and Heath Printers of
Seattle, Washington. Terms of the transactions were not disclosed.

     The acquisition of StorterChilds marks Consolidated Graphics' first entry
into the attractive Florida printing market. Established almost 50 years ago,
StorterChilds is an award-winning printing company and one of the leading
commercial printers in Central Florida. The company will be led by the
management team of John Childs and Jim Storter.

     Heath Printers is one of the premier commercial printers in Seattle and
complements Consolidated Graphics' existing operation in that market. Formed in
1954, Heath Printers has maintained an excellent reputation for quality and
service throughout its history. The management team of Nancy Zylstra, President,
Brian Jaeger, Sales Manager, and Bryan Miller, Plant Manager, collectively with
over 40 years of service to Heath and its customers, will continue to lead the
Company.

     Commenting on the announcement, Joe R. Davis, Chairman and Chief Executive
Officer of Consolidated Graphics said, "Both of these companies are leaders in
their respective markets and are welcome additions to our family of printing
companies. Each has a group of dedicated employees and a strong management team
that have worked together to make these companies successful. We are very
pleased that they have become a part of Consolidated Graphics."

     Consolidated Graphics is recognized as the fastest growing printing company
in the United States. A consolidator in a highly fragmented industry, the
Company adds value to its acquisitions through managerial and operational
expertise, financial strength and economies of scale. Upon completion of pending
transactions, Consolidated Graphics will have 31 companies nationwide with
annualized revenue of more than $290 million.


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