Cenveo Reports Smaller Loss on Lower SalesMarch 3, 2010
Burton concluded: "2009 was the most challenging year I ever experienced in my business career. The economic events that affected our industry were truly unprecedented and previously unthinkable. Cenveo’s skilled and talented employees rose to meet every challenge confronting us and, in the process, we distinguished ourselves through our quality service to our customers. I am truly thankful for all the hard work by our employees under the leadership of our senior management team and I appreciate their dedication demonstrated during this truly historic period.”
“As we now place our full attention on 2010, I feel there will be a solid rebound this year for the major players in the printing industry, including Cenveo. The two recently announced M&A transactions indicate there will be continued industry consolidation to reduce excess capacity. I remain optimistic about our Company’s future prospects and, despite continued uncertainty in the macro-economic environment, I am confident that Cenveo’s long-term game plan of investing in strong niche product opportunities will yield dividends to us in 2010. This expectation, along with the continued positive trends in our product markets and the strong performance we have seen from Nashua to date, supports my belief that Cenveo’s financial goals of $250 million in Adjusted EBITDA and approximately $120 million free cash flow are well within reach. To personally demonstrate my conviction in the Company’s prospects, I recently purchased approximately $500,000 of Cenveo stock in the open market and doubled my Employee Stock Purchase Plan contribution to $20,000 a month. I look forward to our conference call tomorrow to discuss in more depth our positive 2010 outlook for Cenveo.”
In addition to results presented in accordance with accounting principles generally accepted in the U.S. (“GAAP”), included in this release are certain Non-GAAP financial measures, including Adjusted EBITDA, Non-GAAP income (loss) from continuing operations, Non-GAAP operating income, and Non-GAAP operating income margin, and free cash flow. Non-GAAP operating income is defined as operating income excluding integration, acquisition and other charges, stock-based compensation provision, and restructuring, impairment and other charges. Non-GAAP operating income margin is calculated by dividing Non-GAAP operating income into net sales. Free cash flow is defined as Adjusted EBITDA less cash interest, cash taxes, and capital expenditure. These Non-GAAP financial measures are defined herein, and should be read in conjunction with GAAP financial measures. A reconciliation of income (loss) from continuing operations to Non-GAAP income from continuing operations and operating income to Non-GAAP operating income is presented in the attached tables. These Non-GAAP financial measures are not presented as an alternative to cash flows from operations, as a measure of our liquidity or as an alternative to reported net income (loss) as an indicator of our operating performance. The Non-GAAP financial measures as used herein may not be comparable to similarly titled measures reported by competitors.
We believe the use of Adjusted EBITDA, Non-GAAP income (loss) from continuing operations, Non-GAAP operating income and Non-GAAP operating income margin along with GAAP financial measures enhances the understanding of our operating results and may be useful to investors in comparing our operating performance with that of our competitors and estimating our enterprise value. Adjusted EBITDA is also a useful tool in evaluating the core operating results of the Company given the significant variation that can result from, for example, the timing of capital expenditures, the amount of intangible assets recorded or the differences in assets’ lives. We also use Adjusted EBITDA internally to evaluate the operating performance of our segments, to allocate resources and capital to such segments, to measure performance for incentive compensation programs, and to evaluate future growth opportunities. The Non-GAAP financial measures included in this press release are reconciled to their most directly comparable GAAP financial measures in the tables included herein.
Cenveo (NYSE: CVO), headquartered in Stamford, Connecticut, is a leader in the management and distribution of print and related products and solutions. The Company provides its customers with low-cost alternatives within its core businesses of labels and forms manufacturing, packaging and publisher offerings, envelope production, and printing; supplying one-stop solutions from design through fulfillment. Cenveo delivers everyday for its customers through a network of production, fulfillment, content management, and distribution facilities across the globe.