ACCO Brands Reports First Quarter Results
ACCO Brands reported net sales of $359 million with a gross margin expanding 120 basis points in the first quarter of 2024. The company is on track to achieve over $20 million in cost savings from their cost reduction program. Net operating cash flow improved by $51 million, generating free cash flow of $26 million. The consolidated net leverage ratio stood at 3.5x. However, the company reported a loss per share of $(0.07), but adjusted EPS was $0.03, in line with expectations.
Reported net sales of $359 million and gross margin expanded by 120 basis points.
On track to deliver over $20 million in cost savings from the cost reduction program.
Improved net operating cash flow by $51 million, generating free cash flow of $26 million.
Consolidated net leverage ratio improved to 3.5x at quarter-end.
Net sales declined by 10.9%, with operating income down to $5.9 million compared to $10.1 million in 2023.
Reported operating income declined to $16.2 million from $24.3 million in 2023.
Net loss of $6.3 million compared to $3.7 million in 2023, with adjusted net income at $2.7 million from $8.5 million.
Adjusted earnings per share dropped to $0.03 per share from $0.09 per share in 2023.
Insights
-
Reported net sales of
$359 million -
On track to deliver over
$20 million -
Net operating cash flow improved
$51 million $26 million - Consolidated net leverage ratio of 3.5x at quarter-end
-
Loss per share of
$(0.07) $0.03
"Our first quarter results demonstrate our commitment to improving profitability and cash flow generation as we work to overcome persistent consumer and business spending weakness. We generated higher free cash flow year over year, which allowed us to end the quarter with a leverage ratio of 3.5 times, which was a significant improvement over the prior year. I am proud of our team's execution as we implemented our global restructuring and cost savings initiatives, which are already yielding benefits," stated ACCO Brands' President and Chief Executive Officer, Tom Tedford.
"We continue to invest in new product development, innovation, and other growth initiatives, while generating strong free cash flow and reducing our debt levels. Looking ahead, we remain focused on streamlining our operations and refining our strategy to enhance business performance and create long-term shareholder value. " concluded Mr. Tedford.
First Quarter Results
Net sales were
Operating income was
Net loss was
Capital Allocation and Dividend
For the quarter, the Company significantly improved its operating cash flow to
On April 26, 2024, ACCO Brands announced that its board of directors declared a regular quarterly cash dividend of
Business Segment Results
ACCO Brands Americas – First quarter segment net sales of
First quarter operating income was
ACCO Brands International – First quarter segment net sales of
First quarter operating income was
Updated Full Year 2024 and Second Quarter Outlook
"With a demand environment for our categories that is slower to recover than anticipated, we have prudently tempered our full year 2024 outlook. We previously announced a multi-year,
For the full year, the Company expects reported sales to be down in the range of
In the second quarter, the Company expects reported sales to be down in the range of
Webcast
At 8:30 a.m. ET on May 3, 2024, ACCO Brands Corporation will host a conference call to discuss the Company's first quarter and full year 2024 results. The call will be broadcast live via webcast. The webcast can be accessed through the Investor Relations section of www.accobrands.com. The webcast will be in listen-only mode and will be available for replay following the event.
About ACCO Brands Corporation
ACCO Brands, the Home of Great Brands Built by Great People, designs, manufactures and markets consumer and end-user products that help people work, learn, and play. Our widely recognized brands include AT-A-GLANCE®, Five Star®, Kensington®, Leitz®, Mead®, PowerA®, Swingline®, Tilibra® and many others. More information about ACCO Brands Corporation (NYSE: ACCO) can be found at www.accobrands.com.
Non-GAAP Financial Measures
In addition to financial results reported in accordance with generally accepted accounting principles (GAAP), we have provided certain non-GAAP financial information in this earnings release to aid investors in understanding the Company's performance. Each non-GAAP financial measure is defined and reconciled to its most directly comparable GAAP financial measure in the "About Non-GAAP Financial Measures" section of this earnings release.
Forward-Looking Statements
Statements contained herein, other than statements of historical fact, particularly those anticipating future financial performance, business prospects, growth, strategies, business operations and similar matters, results of operations, liquidity and financial condition, and those relating to cost reductions and anticipated pre-tax savings and restructuring costs are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on the beliefs and assumptions of management based on information available to us at the time such statements are made. These statements, which are generally identifiable by the use of the words "will," "believe," "expect," "intend," "anticipate," "estimate," "forecast," "project," "plan," and similar expressions, are subject to certain risks and uncertainties, are made as of the date hereof, and we undertake no duty or obligation to update them. Forward-looking statements are subject to the occurrence of events outside the Company's control and actual results and the timing of events may differ materially from those suggested or implied by such forward-looking statements due to numerous factors that involve substantial known and unknown risks and uncertainties. Investors and others are cautioned not to place undue reliance on forward-looking statements when deciding whether to buy, sell or hold the Company’s securities.
Our outlook is based on certain assumptions which we believe to be reasonable under the circumstances. These include, without limitation, assumptions regarding the impact of inflation and global geopolitical and economic uncertainties and fluctuations in foreign currency exchange rates; and the other factors described below.
Among the factors that could cause our actual results to differ materially from our forward-looking statements are: a relatively limited number of large customers account for a significant percentage of our sales; sales of our products are affected by general economic and business conditions globally and in the countries in which we operate; risks associated with foreign currency exchange rate fluctuations; challenges related to the highly competitive business environment in which we operate; our ability to develop and market innovative products that meet consumer demands and to expand into new and adjacent product categories that are experiencing higher growth rates; the long-term impacts of the COVID-19 pandemic; our ability to successfully expand our business in emerging markets and the exposure to greater financial, operational, regulatory, compliance and other risks in such markets; the continued decline in the use of certain of our products; risks associated with seasonality; the sufficiency of investment returns on pension assets, risks related to actuarial assumptions, changes in government regulations and changes in the unfunded liabilities of a multi-employer pension plan; any impairment of our intangible assets; our ability to secure, protect and maintain our intellectual property rights, and our ability to license rights from major gaming console makers and video game publishers to support our gaming accessories business; our ability to successfully execute our multi-year restructuring and cost savings program and realize the anticipated benefits; continued disruptions in the global supply chain; risks associated with inflation and other changes in the cost or availability of raw materials, transportation, labor, and other necessary supplies and services and the cost of finished goods; risks associated with outsourcing production of certain of our products, information technology systems and other administrative functions; the failure, inadequacy or interruption of our information technology systems or its supporting infrastructure; risks associated with a cybersecurity incident or information security breach, including that related to a disclosure of personally identifiable information; our ability to grow profitably through acquisitions, and successfully integrate them; risks associated with our indebtedness, including limitations imposed by restrictive covenants, our debt service obligations, and our ability to comply with financial ratios and tests; a change in or discontinuance of our stock repurchase program or the payment of dividends; product liability claims, recalls or regulatory actions; the impact of litigation or other legal proceedings; the impact of additional tax liabilities stemming from our global operations and changes in tax laws, regulations and tax rates; our failure to comply with applicable laws, rules and regulations and self-regulatory requirements, the costs of compliance and the impact of changes in such laws; our ability to attract and retain qualified personnel; the volatility of our stock price; risks associated with circumstances outside our control, including those caused by public health crises, such as the occurrence of contagious diseases, severe weather events, war, terrorism and other geopolitical incidents; and other risks and uncertainties described in "Part I, Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2023, and in other reports we file with the Securities and Exchange Commission.
ACCO Brands Corporation and Subsidiaries |
||||||||
Condensed Consolidated Balance Sheets |
||||||||
|
March 31,
|
|
|
December 31,
|
|
|||
(in millions) |
|
(unaudited) |
|
|
|
|
||
Assets |
|
|
|
|
|
|
||
Current assets: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
124.6 |
|
|
$ |
66.4 |
|
Accounts receivable, net |
|
|
274.8 |
|
|
|
430.7 |
|
Inventories |
|
|
348.8 |
|
|
|
327.5 |
|
Other current assets |
|
|
49.6 |
|
|
|
30.8 |
|
Total current assets |
|
|
797.8 |
|
|
|
855.4 |
|
Total property, plant and equipment |
|
|
584.7 |
|
|
|
599.6 |
|
Less: accumulated depreciation |
|
|
(422.1 |
) |
|
|
(429.5 |
) |
Property, plant and equipment, net |
|
|
162.6 |
|
|
|
170.1 |
|
Right of use asset, leases |
|
|
92.2 |
|
|
|
91.0 |
|
Deferred income taxes |
|
|
99.0 |
|
|
|
104.7 |
|
Goodwill |
|
|
577.1 |
|
|
|
590.0 |
|
Identifiable intangibles, net |
|
|
797.9 |
|
|
|
815.7 |
|
Other non-current assets |
|
|
17.0 |
|
|
|
17.9 |
|
Total assets |
|
$ |
2,543.6 |
|
|
$ |
2,644.8 |
|
Liabilities and Stockholders' Equity |
|
|
|
|
|
|
||
Current liabilities: |
|
|
|
|
|
|
||
Notes payable |
|
$ |
— |
|
|
$ |
0.2 |
|
Current portion of long-term debt |
|
|
57.3 |
|
|
|
36.5 |
|
Accounts payable |
|
|
170.1 |
|
|
|
183.7 |
|
Accrued compensation |
|
|
33.3 |
|
|
|
53.3 |
|
Accrued customer program liabilities |
|
|
73.4 |
|
|
|
104.0 |
|
Lease liabilities |
|
|
20.6 |
|
|
|
20.5 |
|
Other current liabilities |
|
|
118.6 |
|
|
|
143.8 |
|
Total current liabilities |
|
|
473.3 |
|
|
|
542.0 |
|
Long-term debt, net |
|
|
897.5 |
|
|
|
882.2 |
|
Long-term lease liabilities |
|
|
77.8 |
|
|
|
76.8 |
|
Deferred income taxes |
|
|
119.9 |
|
|
|
125.6 |
|
Pension and post-retirement benefit obligations |
|
|
148.2 |
|
|
|
157.6 |
|
Other non-current liabilities |
|
|
68.4 |
|
|
|
73.6 |
|
Total liabilities |
|
|
1,785.1 |
|
|
|
1,857.8 |
|
Stockholders' equity: |
|
|
|
|
|
|
||
Common stock |
|
|
1.0 |
|
|
|
1.0 |
|
Treasury stock |
|
|
(47.0 |
) |
|
|
(45.1 |
) |
Paid-in capital |
|
|
1,918.8 |
|
|
|
1,913.4 |
|
Accumulated other comprehensive loss |
|
|
(544.6 |
) |
|
|
(526.3 |
) |
Accumulated deficit |
|
|
(569.7 |
) |
|
|
(556.0 |
) |
Total stockholders' equity |
|
|
758.5 |
|
|
|
787.0 |
|
Total liabilities and stockholders' equity |
|
$ |
2,543.6 |
|
|
$ |
2,644.8 |
|
ACCO Brands Corporation and Subsidiaries |
||||||||||
Consolidated Statements of Loss (Unaudited) |
||||||||||
|
|
Three Months Ended
|
|
|
||||||
(in millions, except per share data) |
|
2024 |
|
2023 |
|
% Change |
||||
Net sales |
|
$ |
358.9 |
|
|
$ |
402.6 |
|
|
(10.9)% |
Cost of products sold |
|
|
248.5 |
|
|
|
283.3 |
|
|
(12.3)% |
Gross profit |
|
|
110.4 |
|
|
|
119.3 |
|
|
(7.5)% |
Operating costs and expenses: |
|
|
|
|
|
|
|
|
||
Selling, general and administrative expenses |
|
|
94.2 |
|
|
|
95.0 |
|
|
(0.8)% |
Amortization of intangibles |
|
|
10.6 |
|
|
|
10.9 |
|
|
(2.8)% |
Restructuring |
|
|
(0.3 |
) |
|
|
3.3 |
|
|
NM |
Total operating costs and expenses |
|
|
104.5 |
|
|
|
109.2 |
|
|
(4.3)% |
Operating income |
|
|
5.9 |
|
|
|
10.1 |
|
|
(41.6)% |
Non-operating expense (income): |
|
|
|
|
|
|
|
|
||
Interest expense |
|
|
13.3 |
|
|
|
13.9 |
|
|
(4.3)% |
Interest income |
|
|
(1.9 |
) |
|
|
(2.4 |
) |
|
(20.8)% |
Non-operating pension expense |
|
|
0.4 |
|
|
|
0.1 |
|
|
NM |
Other (income) expense, net |
|
|
(0.6 |
) |
|
|
1.8 |
|
|
NM |
Loss before income tax |
|
|
(5.3 |
) |
|
|
(3.3 |
) |
|
|
Income tax expense |
|
|
1.0 |
|
|
|
0.4 |
|
|
NM |
Net loss |
|
$ |
(6.3 |
) |
|
$ |
(3.7 |
) |
|
|
|
|
|
|
|
|
|
|
|
||
Per share: |
|
|
|
|
|
|
|
|
||
Basic loss per share |
|
$ |
(0.07 |
) |
|
$ |
(0.04 |
) |
|
|
Diluted loss per share |
|
$ |
(0.07 |
) |
|
$ |
(0.04 |
) |
|
|
|
|
|
|
|
|
|
|
|
||
Weighted average number of shares outstanding: |
|
|
|
|
|
|
|
|
||
Basic |
|
|
95.7 |
|
|
|
94.9 |
|
|
|
Diluted |
|
|
95.7 |
|
|
|
94.9 |
|
|
|
|
|
|
|
|
|
|
|
|
||
Cash dividends declared per common share |
|
$ |
0.075 |
|
|
$ |
0.075 |
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||
Statistics (as a % of Net sales, except Income tax rate) |
|
|
|
|
|
|
|
|
||
|
|
Three Months Ended
|
|
|
||||||
|
|
2024 |
|
2023 |
|
|
||||
Gross profit (Net sales, less Cost of products sold) |
|
|
30.8 |
% |
|
|
29.6 |
% |
|
|
Selling, general and administrative expenses |
|
|
26.2 |
% |
|
|
23.6 |
% |
|
|
Operating income |
|
|
1.6 |
% |
|
|
2.5 |
% |
|
|
Loss before income tax |
|
|
(1.5 |
)% |
|
|
(0.8 |
)% |
|
|
Net loss |
|
|
(1.8 |
)% |
|
|
(0.9 |
)% |
|
|
Income tax rate |
|
|
(18.9 |
)% |
|
|
(12.1 |
)% |
|
|
ACCO Brands Corporation and Subsidiaries |
||||||||
Condensed Consolidated Statements of Cash Flows (Unaudited) |
||||||||
|
|
Three Months Ended March 31, |
||||||
(in millions) |
|
2024 |
|
2023 |
||||
Operating activities |
|
|
|
|
|
|
||
Net loss |
|
$ |
(6.3 |
) |
|
$ |
(3.7 |
) |
Loss on disposal of assets |
|
|
— |
|
|
|
1.1 |
|
Depreciation |
|
|
7.4 |
|
|
|
9.0 |
|
Amortization of debt issuance costs |
|
|
0.7 |
|
|
|
0.8 |
|
Amortization of intangibles |
|
|
10.6 |
|
|
|
10.9 |
|
Stock-based compensation |
|
|
5.1 |
|
|
|
5.6 |
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
153.8 |
|
|
|
88.6 |
|
Inventories |
|
|
(26.5 |
) |
|
|
(25.0 |
) |
Other assets |
|
|
(18.6 |
) |
|
|
3.6 |
|
Accounts payable |
|
|
(12.7 |
) |
|
|
(38.0 |
) |
Accrued expenses and other liabilities |
|
|
(76.2 |
) |
|
|
(63.6 |
) |
Accrued income taxes |
|
|
(9.1 |
) |
|
|
(12.5 |
) |
Net cash provided (used) by operating activities |
|
|
28.2 |
|
|
|
(23.2 |
) |
Investing activities |
|
|
|
|
|
|
||
Additions to property, plant and equipment |
|
|
(2.3 |
) |
|
|
(2.0 |
) |
Net cash used by investing activities |
|
|
(2.3 |
) |
|
|
(2.0 |
) |
Financing activities |
|
|
|
|
|
|
||
Proceeds from long-term borrowings |
|
|
61.4 |
|
|
|
101.1 |
|
Repayments of long-term debt |
|
|
(18.9 |
) |
|
|
(10.0 |
) |
Repayments of notes payable, net |
|
|
(0.2 |
) |
|
|
(1.2 |
) |
Dividends paid |
|
|
(7.2 |
) |
|
|
— |
|
Payments related to tax withholding for stock-based compensation |
|
|
(1.9 |
) |
|
|
(1.7 |
) |
Net cash provided by financing activities |
|
|
33.2 |
|
|
|
88.2 |
|
Effect of foreign exchange rate changes on cash and cash equivalents |
|
|
(0.9 |
) |
|
|
1.9 |
|
Net increase in cash and cash equivalents |
|
|
58.2 |
|
|
|
64.9 |
|
Cash and cash equivalents |
|
|
|
|
|
|
||
Beginning of the period |
|
$ |
66.4 |
|
|
$ |
62.2 |
|
End of the period |
|
$ |
124.6 |
|
|
$ |
127.1 |
|
About Non-GAAP Financial Measures
We explain below how we calculate each of our non-GAAP financial measures. This is followed by a reconciliation of our current period and historical non-GAAP financial measures to the most directly comparable GAAP financial measures.
We use our non-GAAP financial measures both to explain our results to stockholders and the investment community and in the internal evaluation and management of our business. We believe our non-GAAP financial measures provide management and investors with a more complete understanding of our underlying operational results and trends, facilitate meaningful period-to-period comparisons and enhance an overall understanding of our past and future financial performance.
Our non-GAAP financial measures exclude certain items that may have a material impact upon our reported financial results such as restructuring charges, the impact of foreign currency exchange rate fluctuations, unusual tax items, goodwill impairment charges, and other non-recurring items that we consider to be outside of our core operations. On an interim basis, we also calculate adjusted income tax expense using our estimated annual income tax rate. These measures should not be considered in isolation or as a substitute for, or superior to, the directly comparable GAAP financial measures and should be read in connection with the Company’s financial statements presented in accordance with GAAP.
Our non-GAAP financial measures include the following:
Comparable Sales: Represents net sales excluding the impact of material acquisitions, if any, with current-period foreign operation sales translated at prior-year currency rates. We believe comparable sales are useful to investors and management because they reflect underlying sales and sales trends without the effect of material acquisitions and fluctuations in foreign exchange rates and facilitate meaningful period-to-period comparisons. We sometimes refer to comparable sales as comparable net sales.
Adjusted Operating Income (Loss)/Adjusted Income (Loss) Before Taxes/Adjusted Net Income (Loss)/Adjusted Net Income (Loss) Per Diluted Share: Represents operating income (loss), income (loss) before taxes, net income (loss), and net income (loss) per diluted share excluding restructuring and goodwill impairment charges, the amortization of intangibles, non-recurring items, other income/expense, adjustments to reflect the estimated annual tax rate and discrete income tax adjustments, including income tax related to the foregoing. We believe these adjusted non-GAAP financial measures are useful to investors and management because they reflect our underlying operating performance before items that we consider to be outside our core operations and facilitate meaningful period-to-period comparisons. Senior management’s incentive compensation is derived, in part, using adjusted operating income and adjusted net income per diluted share, which is derived from adjusted net income. We sometimes refer to adjusted net income per diluted share as adjusted earnings per share or adjusted EPS.
Adjusted Income Tax Expense: Represents income tax expense calculated using the estimated annual income tax rate and excludes the tax effect of the items that have been excluded from adjusted income before taxes, unusual income tax items such as the impact of tax audits and changes in laws, significant reserves for cash repatriation, excess tax benefits/losses, and other discrete tax items. We believe our adjusted income tax expense is useful to investors because it reflects our income tax calculated using the estimated annual tax rate before discrete items that we consider to be outside our core operations and facilitates meaningful period-to-period comparisons.
Adjusted EBITDA: Represents net income excluding the effects of depreciation, stock-based compensation expense, amortization of intangibles, interest expense, net, other (income) expense, net, and income tax expense, restructuring and goodwill impairment charges, and other non-recurring items. We believe adjusted EBITDA is useful to investors because it reflects our underlying cash profitability and adjusts for certain non-cash charges and other items that we consider to be outside our core operations and facilitates meaningful period-to-period comparisons. In addition, this calculation of adjusted EBITDA is used in our loan agreement to calculate our leverage ratio covenant.
Free Cash Flow: Free cash flow represents cash flow from operating activities less cash used for additions to property, plant and equipment. We believe free cash flow is useful to investors because it measures our available cash flow for paying dividends, funding strategic material acquisitions, reducing debt, and repurchasing shares.
Consolidated Leverage Ratio: Represents balance sheet debt plus debt origination costs and less any cash and cash equivalents divided by adjusted EBITDA. We believe that consolidated leverage ratio is useful to investors since the company has the ability to, and may decide to use, a portion of its cash and cash equivalents to retire debt.
We also provide forward-looking non-GAAP comparable sales, adjusted earnings per share, free cash flow, adjusted EBITDA and historical and forward-looking consolidated leverage ratio. We do not provide a reconciliation of these forward-looking and historical non-GAAP measures to GAAP because the GAAP financial measure is not currently available and management cannot reliably predict all the necessary components of such non-GAAP measures without unreasonable effort or expense due to the inherent difficulty of forecasting and quantifying certain amounts that are necessary for such a reconciliation, including adjustments that could be made for restructuring, integration and acquisition-related expenses, the variability of our tax rate and the impact of foreign currency fluctuation and material acquisitions, and other charges reflected in our historical results. The probable significance of each of these items is high and, based on historical experience, could be material.
ACCO Brands Corporation and Subsidiaries
Reconciliation of GAAP to Adjusted Non-GAAP Information (Unaudited)
(In millions, except per share data)
The following tables set forth a reconciliation of certain Consolidated Statements of Loss information reported in accordance with GAAP to Adjusted Non-GAAP Information for the three months ended March 31, 2024 and 2023.
|
|
Three Months Ended March 31, 2024 |
||||||||||||||
|
|
Operating
|
|
% of
|
|
(Loss) Income
|
|
% of
|
|
Income Tax
|
|
Tax Rate |
|
Net (Loss)
|
|
% of Sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported GAAP |
|
|
|
1.6 % |
|
|
|
(1.5)% |
|
|
|
(18.9)% |
|
|
|
(1.8)% |
Reported GAAP diluted loss per share (EPS) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring |
|
(0.3) |
|
|
|
(0.3) |
|
|
|
(0.1) |
|
|
|
(0.2) |
|
|
Amortization of intangibles |
|
10.6 |
|
|
|
10.6 |
|
|
|
2.9 |
|
|
|
7.7 |
|
|
Net operating tax gains |
(A) |
— |
|
|
|
(1.2) |
|
|
|
(0.4) |
|
|
|
(0.8) |
|
|
Discrete tax items and adjustments to annual tax rate |
(B) |
— |
|
|
|
— |
|
|
|
(2.3) |
|
|
|
2.3 |
|
|
Adjusted Non-GAAP |
|
|
|
4.5 % |
|
|
|
1.1 % |
|
|
|
29.0 % |
|
|
|
0.8 % |
Adjusted net income per diluted share (Adjusted EPS) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2023 |
||||||||||||||
|
|
Operating
|
|
% of
|
|
Income (Loss)
|
|
% of
|
|
Income Tax
|
|
Tax Rate |
|
Net (Loss)
|
|
% of Sales |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reported GAAP |
|
|
|
2.5 % |
|
|
|
(0.8)% |
|
|
|
(12.1)% |
|
|
|
(0.9)% |
Reported GAAP diluted loss per share (EPS) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring |
|
3.3 |
|
|
|
3.3 |
|
|
|
0.9 |
|
|
|
2.4 |
|
|
Amortization of intangibles |
|
10.9 |
|
|
|
10.9 |
|
|
|
2.9 |
|
|
|
8.0 |
|
|
Other asset write-off |
(C) |
— |
|
|
|
1.1 |
|
|
|
0.3 |
|
|
|
0.8 |
|
|
Discrete tax items and adjustments to annual tax rate |
(B) |
— |
|
|
|
— |
|
|
|
(1.0) |
|
|
|
1.0 |
|
|
Adjusted Non-GAAP |
|
|
|
6.0 % |
|
|
|
3.0 % |
|
|
|
29.4 % |
|
|
|
2.1 % |
Adjusted net income per diluted share (Adjusted EPS) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes to Reconciliations of GAAP to Adjusted Non-GAAP Information and Net Loss to Adjusted EBITDA (Unaudited)
A. |
Represents certain indirect tax credits in |
B. |
The income tax impact of the non-GAAP adjustments and other discrete tax items. The Company adjusts its tax rate to |
C. |
Represents the write off of assets related to a capital project. |
ACCO Brands Corporation and Subsidiaries
Reconciliation of Net Loss to Adjusted EBITDA (Unaudited)
(In millions)
The following table sets forth a reconciliation of net loss reported in accordance with GAAP to Adjusted EBITDA.
|
|
Three months ended
|
|
|
||
|
|
2024 |
|
2023 |
|
% Change |
Net loss |
|
|
|
|
|
70.3 % |
Stock-based compensation |
|
5.1 |
|
5.6 |
|
(8.9)% |
Depreciation |
|
7.4 |
|
9.0 |
|
(17.8)% |
Amortization of intangibles |
|
10.6 |
|
10.9 |
|
(2.8)% |
Restructuring credits |
|
(0.3) |
|
3.3 |
|
(109.1)% |
Interest expense, net |
|
11.4 |
|
11.5 |
|
(0.9)% |
Other (income) expense, net |
|
(0.6) |
|
1.8 |
|
(133.3)% |
Income tax expense |
|
1.0 |
|
0.4 |
|
NM |
Adjusted EBITDA (non-GAAP) |
|
|
|
|
|
(27.1)% |
Adjusted EBITDA as a % of Net Sales |
|
7.9 % |
|
9.6 % |
|
|
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (Unaudited)
(In millions)
The following table sets forth a reconciliation of net cash provided by operating activities reported in accordance with GAAP to Free Cash Flow.
|
|
For the three months
|
|
For the three months
|
Net cash provided by operating activities |
|
|
|
|
Net (used) provided by: |
|
|
|
|
Additions to property, plant and equipment |
|
(2.3) |
|
(2.0) |
Free Cash Flow (non-GAAP) |
|
|
|
|
ACCO Brands Corporation and Subsidiaries |
|||||||||||||||||||||||||||||
Supplemental Business Segment Information and Reconciliation (Unaudited) |
|||||||||||||||||||||||||||||
(In millions) |
|||||||||||||||||||||||||||||
|
2024 |
|
2023 |
|
Changes |
||||||||||||||||||||||||
|
Reported
|
|
Reported
|
|
Adjusted
|
|
Adjusted
|
|
Adjusted
|
|
Reported
|
|
Reported
|
|
Adjusted
|
|
Adjusted
|
|
Adjusted
|
|
Net
|
|
Net
|
|
Adjusted
|
|
Adjusted
|
|
Adjusted
|
Q1: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ACCO Brands Americas |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(14.3)% |
|
|
|
(34.2)% |
|
(190) |
ACCO Brands International |
161.7 |
|
12.8 |
|
4.1 |
|
16.9 |
|
|
|
172.6 |
|
9.7 |
|
7.8 |
|
17.5 |
|
|
|
(10.9) |
|
(6.3)% |
|
(0.6) |
|
(3.4)% |
|
40 |
Corporate |
— |
|
(13.0) |
|
— |
|
(13.0) |
|
|
|
— |
|
(11.9) |
|
— |
|
(11.9) |
|
|
|
— |
|
|
|
(1.1) |
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(10.9)% |
|
|
|
(33.3)% |
|
(150) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See "Notes to Reconciliations of GAAP to Adjusted Non-GAAP Information and Net Loss to Adjusted EBITDA (Unaudited)" for further information regarding adjusted items.
ACCO Brands Corporation and Subsidiaries
Supplemental Net Sales Change Analysis (Unaudited)
|
|
% Change - Net Sales |
|
$ Change - Net Sales (in millions) |
|
||||||||
|
|
GAAP |
Non-GAAP |
|
GAAP |
Non-GAAP |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Sales Change |
|
Currency Translation |
|
Comparable Sales Change (A) |
|
Net Sales Change |
|
Currency Translation |
|
Comparable Sales Change (A) |
Comparable Sales |
Q1 2024: |
|
|
|
|
|
|
|
|
|
|
|
|
|
ACCO Brands Americas |
|
(14.3)% |
|
1.0 % |
|
(15.3)% |
|
|
|
|
|
|
|
ACCO Brands International |
|
(6.3)% |
|
(0.4)% |
|
(5.9)% |
|
(10.9) |
|
(0.7) |
|
(10.2) |
162.4 |
Total |
|
(10.9)% |
|
0.4 % |
|
(11.3)% |
|
|
|
|
|
|
|
(A) Comparable sales represents net sales excluding material acquisitions, if any, and with current-period foreign operation sales translated at the prior-year currency rates.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240502622892/en/
Christopher McGinnis
Investor Relations
(847) 796-4320
Kori Reed
Media Relations
(224) 501-0406
Source: ACCO Brands Corporation
FAQ
What were ACCO Brands' reported net sales for the first quarter of 2024?
What was the adjusted EPS for ACCO Brands in the first quarter of 2024?
What was the consolidated net leverage ratio of ACCO Brands at the end of the first quarter of 2024?
What was the percentage decline in net sales for ACCO Brands in the first quarter of 2024 compared to 2023?
When will ACCO Brands be paying its regular quarterly cash dividend?
What was the operating income for ACCO Brands Americas in the first quarter of 2024?
What was the adjusted operating income for ACCO Brands International in the first quarter of 2024?
What is ACCO Brands' outlook for full year 2024 adjusted EPS?
What is the expected range for ACCO Brands' second quarter 2024 adjusted EPS?
