Checks Continue To Erode At Harland Clarke
SAN ANTONIO – Harland Clarke, the nation’s leading check printer, said yesterday additional declines in its core checks business continue to pose major hurdles to its business.
The company reported a 27% decline in first quarter earnings, to $23.4 million, caused mainly by a 6% fall in revenue. The revenue shortfall was caused mostly by a 10% drop off in first quarter sales for its core Harland Clarke checks business, to $279.4 million. Operating income for the Harland Clarke segment fell by 15% to $55.8 million.
The decrease in operating income was due primarily to volume declines and decreased revenues per check unit, partially offset by labor cost reductions resulting from restructuring activities and lower depreciation and travel expenses.
Revenue growth for the company’s Harland Financial Solutions and Scantron units helped stem the continuing decline in the checks business.
Harland Clarke was formed by the 2005 acquisition of Clarke American and the 2007 acquisition of John H. Harland Co. by corporate financier Ronald O. Perelman and M&F Worldwide, a holding company Perelman controls. The pairing of the nation’s second- and third-largest check printers created the largest, at a time when check usage is rapidly declining.