Orlando, FL 12/12/11 (StreetBeat) -- American Greetings Corp's (NYSE:AM) third-quarter profit dropped nearly 40 percent as it spent more on selling and marketing its greeting cards, and the company said its cash flow in 2012 would be hurt by the higher expenses.Shares of the company slumped 23 percent to $13.06 on Thursday morning on the New York Stock Exchange.
American Greetings reported third-quarter net income of $20.2 million, or 50 cents per share, compared with $32.2 million, or 78 cents per share, last year.
Revenue rose 8 percent to $463.6 million.
Selling, distribution and marketing expenses rose 19 percent to $140.1 million in the quarter.
The Cleveland, Ohio-based company plans to spend more on selling and marketing its greeting cards which will reduce the cash the business generates in 2012.
The company expects cash flow from operating activities to be about $90-$110 million, compared with its prior estimate of $125-$145 million.
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