Champion Industries, Inc. History

Company Perspectives:

Champion Industries, Inc., headquartered in Huntington, West Virginia, is a major commercial printer, business forms manufacturer, and supplier of office products and office furniture. With annual revenues of over $120 million, the Company serves the geographical area east of the Mississippi through regional divisions.

Company History:

Champion Industries, Inc. and its predecessor companies have been based in Huntington, West Virginia, since 1922. Champion was formed in 1992 when The Harrah and Reynolds Corporation spun off its printing division. Since that time Champion has grown through a series of acquisitions as well as internal growth. Its largest acquisition was that of Interform at the end of 1996. A business forms printer, Interform added substantially to the printing component of Champion's revenue. Prior to the acquisition, office products and furniture accounted for approximately 30 percent of Champion's revenue in 1994, with printing accounting for the rest. By 1998 office products and furniture accounted for approximately 23 percent of Champion's revenue, up from less than 19 percent in 1997.

Champion is organized into 21 divisions, 15 of which are operated as wholly owned subsidiaries. Ten of the divisions are devoted to commercial printing. Three divisions specialize in business forms. One division manufactures and sells tags used in a variety of industries. The company's office products, office furniture, and office design businesses are conducted by two subsidiaries, Stationers, Inc., which primarily services customers located in West Virginia, Ohio, and eastern Kentucky, and Smith & Butterfield Co., Inc., which primarily services customers located in Indiana and western Kentucky.

Chapman Printing Founded, 1922

In 1922 John Osiola Costa Chapman founded Chapman Printing Company in Huntington, West Virginia. Operations there grew to include full-scale printing facilities, including web presses, and sales and customer service operations. Nearly 40 years later Chapman was acquired by Harrah and Reynolds in 1964 and became its printing division. Chapman had not grown substantially since its founding and reported net revenue of $3,000 on sales of $103,000.

Chapman Expanded Through Acquisitions, 1970--90

In 1972 Marshall T. Reynolds, president and general manager of Harrah and Reynolds, bought out his partner and became the sole shareholder in Chapman. In 1974 the Charleston division was established through the acquisition of the printing operations of Rose City Press. In 1977 the Parkersburg division opened and was expanded by the acquisitions of Park Press and McGlothin Printing Company. This division contained a large full-color printing facility and a state-of-the-art studio.

The company's Lexington division began operations in 1983 with the acquisition of the Transylvania Company. This location included a pre-press department, computerized composition facilities, a press room, and a bindery department, as well as customer service.

Expanded Office Furniture and Supplies Operation, 1987

Stationers, Inc., was acquired in 1987. It was an office products, office furniture, and retail bookstore operation. The company then consolidated its own office products and furniture operations with Stationers. In 1991 Stationers divested its retail bookstore operation.

From 1989 to 1992 Chapman reported relatively flat sales and gradually improving earnings. In 1989 it had a net loss of $100,000 on sales of $27.2 million. Sales hovered around $27 million for the next few years, with net income rising to $1.3 million in 1992.

Chapman Became Champion Industries, 1992

On July 1, 1992, Champion Industries was chartered as a West Virginia corporation. Prior to the company's initial public offering (IPO) in January 1993, it was operated as the printing division of The Harrah and Reynolds Corporation as Chapman Printing Company and Stationers, Inc. Following the IPO, Champion took possession of substantially all of the operating assets of Harrah and Reynolds's printing division, as well as its outstanding capital stock, in exchange for two million shares of common stock. Proceeds from the IPO were used to pursue an aggressive acquisitions strategy that sought to achieve dominance in specific regional markets in the eastern United States, especially in the South and Southeast.

Began Series of Acquisitions, 1993

In 1993 Stationers expanded through acquisition and began operating in Marietta, Ohio, under the name Garrison Brewer. In June 1993 the Bourque Printing division began operations with the acquisition of Bourque Printing, Inc. in Baton Rouge, Louisiana. Bourque expanded later in 1993 with the acquisition of Strother Forms/Printing of Baton Rouge, in 1994 with the acquisition of certain assets of Spectrum Press, Inc. of Baton Rouge, and then in 1996 with the acquisition of E.S. Upton Printing Co., Inc., of New Orleans. Upton, founded in 1889, was in bankruptcy at the time.

In September 1993 the Dallas Printing division began operation with the acquisition of Dallas Printing Co., Inc., in Jackson, Mississippi. In November Champion acquired Tri-Star Printing, Inc. Tri-Star was doing business as Carolina Cut Sheets, and Champion's subsidiary changed its name to Carolina Cut Sheets. It manufactured single-part business forms for sale to dealers.

For fiscal 1993 Champion reported net income of $2.1 million on revenues of $30.3 million. As a result of acquisitions made in 1993, revenues for fiscal 1994 rose to $43.2 million, and net income increased to 2.7 million. At this time office furniture and products accounted for 30.6 percent of the company's revenues.

In June 1994 Champion acquired certain assets of Premier Data Graphics, a distributor of business forms and data supplies in Clarksburg, West Virginia. In August the Dallas Printing division acquired certain assets of Premier Printing Co., Inc., of Jackson, Mississippi.

Acquired U.S. Tag and Ticket Co., 1995

In June 1995 Champion acquired U.S. Tag and Ticket Co., Inc., of Baltimore, Maryland, in exchange for 52,383 shares of common stock. U.S. Tag and Ticket manufactured tags used in a variety of industries, including shipping, postal, airline, and cruise. In November the company acquired Donihe Graphics, Inc., a high-volume color printer based in Kingsport, Tennessee, for $950,000 in cash and 66,768 shares of common stock. Revenues increased modestly in fiscal 1995 to $49.9 million, and the company reported net income of $3 million.

Four Major Acquisitions, 1996

In February Bourque acquired E.S. Upton Printing Co. for $750,000 in cash. In July Champion acquired Smith & Butterfield Co., Inc., an office products company with locations in Evansville, Indiana, and Owensboro, Kentucky, and made it a division of Stationers. Champion issued 66,666 shares of stock valued at $1.2 million in exchange for all of Smith & Butterfield's stock. In August Champion acquired The Merten Co., a commercial printer headquartered in Cincinnati, Ohio, for cash and assumed liabilities totaling about $2.5 million.

In its largest acquisition to date, Champion acquired Interform Corp., a business forms manufacturer based in Bridgeville, Pennsylvania, for $2.5 million in December. The acquisition gave Champion access to the large northeastern markets of Pennsylvania, New Jersey, and New York.

Revenues for fiscal 1996 increased 33 percent over the previous year to $66.4 million, and net income rose to $3.4 million. Office furniture and products continued to account for about 26 percent of revenues. However, the acquisition of Interform would increase printing's share of revenue in the coming years.

Continued Acquisitions Program, 1997--98

In May 1997 Champion acquired Blue Ridge Printing Co., Inc., of Asheville, North Carolina, and Knoxville, Tennessee, for 277,775 shares of common stock. Champion's revenues for fiscal 1997 were $108.4 million, an increase of 42 percent over the previous year. Net income rose modestly to $3.8 million. Office furniture and products accounted for only 18.8 percent of sales.

Champion made three acquisitions in 1998. In February it acquired the remaining office supply business of Rose City Press of Charleston, West Virginia, for 75,722 shares of stock valued at $1.25 million. In May it acquired Capitol Business Equipment, Inc., doing business as Capitol Business Interiors, of Charleston, West Virginia, for 72,202 shares of common stock valued at $1 million. Also in May Champion acquired Thompson's of Morgantown, Inc., and Thompson's of Barbour County, Inc., based in Morgantown, West Virginia, for 45,473 shares of stock valued at $600,000. Rose City, Capitol, and Thompson's were then operated as divisions of Stationers. For fiscal 1998, Champion reported net income of $4.2 million on sales of $123.1 million.

Outlook, 1999

Champion has acquired 12 printing companies and six office products and office furniture companies since its IPO in 1993. Through its program of acquisitions and internal growth it has been able to realize regional economies of scale, operational efficiencies, and exposure to new markets. It appears that Champion will continue its program of selective acquisitions in the printing and office products and furniture industries as it continues to achieve record profits and revenues.

Principal Subsidiaries: The Chapman Printing Co.; Bourque Printing, Inc.; Dallas Printing Co.; Carolina Cut Sheets; U.S. Tag and Ticket; Donihe Graphics, Inc.; Upton Printing Co.; The Merten Co.; Interform Solutions; Consolidated Graphic Communications; Blue Ridge Printing Co., Inc.; Stationers, Inc.; Garrison Brewer; Smith & Butterfield Co., Inc.; Champion-Clarksburg; Rose City Press; Champion-Morgantown; Capitol Business Interiors.

Further Reading:

Source: International Directory of Company Histories, Vol. 28. St. James Press, 1999.

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