CSS Industries, Inc. announced unaudited consolidated earnings results for the fourth quarter and full year ended March 31, 2018. For the quarter, Net Sales were $81.5 million an increase of 39% compared to $58.7 million in the fourth quarter of fiscal 2017, primarily driven by the acquisition of the Simplicity Creative Group business (“Simplicity”), which was acquired in November 2017 and contributed $20.7 million in the current year quarter. Operating loss was $48.6 million compared to $10.2 million in the prior year quarter. Adjusted operating loss was $5.4 million compared to $5.2 million in the prior year quarter. Net loss was $38.4 million in the quarter compared to $5.2 million in the prior year quarter. Adjusted net loss was $5.0 million compared to $2.0 million. The loss per share was $4.21 compared to $0.57 in the prior year quarter, and the adjusted loss per share was $0.55 compared to $0.22 in the prior year quarter. The larger adjusted net loss and adjusted loss per share compared to the prior year resulted from a lower tax benefit due in part to U.S. tax reform as well as the absence of two discrete income tax benefits recognized in the prior year quarter, and higher interest expense. Adjusted LBITDA was $2.1 million compared to $3.1 million in the prior year quarter. Loss before income taxes was $48.8 million compared to $10.2 million in the prior year quarter. Adjusted operating loss was $5.4 million compared to $5.2 million in the prior year. Adjusted net loss was $5.0 million compared to $2.0 million in the prior year.

For the full year, net sales were $361.9 million an increase of 12% compared to $322.4 million in the prior fiscal year, an increase of $39.5 million (12.2%). Operating loss was $45.7 million compared to operating income of $9.7 million in the prior year. Adjusted operating income was $13.8 million compared to $16.6 million in the prior year. Net loss was $36.5 million compared to net income of $28.5 million in the prior year. Income in the current year was impacted by the intangible asset impairment charges of $27.1 million (net of tax) and acquisition, integration and other costs of $19.4 million (net of tax). Net income in the prior year benefited from $15.7 million (net of tax) of non-recurring income, driven by a $20.0 million bargain purchase gain resulting from the acquisition of McCall. Adjusted net income was $10.0 million compared to $12.8 million in the prior year. Loss per share was $4.01 compared to diluted earnings per share of $3.13 in the prior year, and adjusted EPS were $1.10 compared to $1.40 in the prior year. Adjusted EBITDA was $24.3 million compared to $25.1 million in the prior year. Cash provided by operating activities was $31.4 million for the year compared to $14.9 million in the prior year. Full year capital expenditures were $7.3 million, compared to $5.0 million in the prior year. Free cash flow was $24.1 million compared to $9.9 million in the prior year. Loss before income taxes was $46.4 million compared to $29.7 million in the prior year quarter. Purchase of property, plant and equipment was $7,291,000 compared to $4,957,000 in the prior year quarter. Purchase of intangibles was $36,000 compared to $311,000 in the prior year quarter. Effective tax rate in the quarter was 21.2% on a GAAP basis compared to 50.8% in last year's fourth quarter. Cash provided by operating activities increase was driven by a significant improvement in working capital, especially inventories, as company mentioned. Free cash flow was $24 million compared to $9.9 million last year.

For the fiscal year ending March 31, 2019, the company expects to generate net sales of $398 million to $412 million, resulting in year over year growth of 10% to 14%. The primary driver of growth will be the full year impact of the Simplicity acquisition, partially offset by a decline in the company's base business due to program losses in the Company's gift business. Net loss is expected to be in the range of $2 million to $4 million compared to a net loss of $36.5 million in fiscal 2018. Adjusted EBITDA is expected to be in the range of $26 million an increase of 7% to 19% over the prior yearto $29 million compared to $24.3 million in fiscal 2018. The expected growth in adjusted EBITDA primarily reflects the full year contribution of Simplicity and integration savings related to Simplicity, partially offset by a decline in the company's base business. Company expect an effective tax rate of approximately 24%. This rate incorporates the lower U.S. corporate tax rate for a full year, company expected mix of global income and the inclusion of state taxes

For the quarter, the company reported impairment of goodwill and intangible assets of $33.4 million.