Quad/Graphics Reports a Small Net Sales Decline
SUSSEX, WI—August 9, 2011—Quad/Graphics Inc. reported results for its second quarter ending June 30, 2011, and announced a quarterly cash dividend.
• Second quarter 2011 net sales were $1.07 billion and adjusted EBITDA was $126.7 million vs. net sales of $1.075 billion and adjusted EBITDA of $148.3 million in the same period of 2010.
• Progress continues on the Worldcolor integration and the Company remains confident it will achieve more than $225 million in synergy savings.
• Declared a cash dividend of $0.20 per share, payable on Sept. 9, 2011, to shareholders of record as of Aug. 29, 2011.
• Completed a $1.5 billion debt refinancing that provides greater borrowing capacity and financial flexibility while reducing cash interest payments by an estimated $16 million to $20 million annually.
• Signed an agreement with Transcontinental to essentially exchange Quad/Graphics’ Canadian assets for Transcontinental’s Mexican assets—a move that is expected to create positive incremental Adjusted EBITDA within 12-24 months of the transaction closing.
Unless otherwise noted, all comparisons are to pro forma measures that assume the company’s July 2, 2010, acquisition of World Color Press was completed on Jan. 1, 2010.
“We knew that the comparisons to second quarter 2010 were going to be difficult due to temporary cost reduction activities initiated by Worldcolor primarily during its bankruptcy. As a result, a decline this quarter from 2010 was expected,” said Joel Quadracci, chairman, president and CEO.
“The company experienced net sales declines in our book segment and continuing headwinds from industry pricing pressures. Operationally, we continued to experience temporary frictional costs resulting from the continued rapid ramp-up of facilities receiving work from those undergoing consolidation. Despite the headwinds we face, we are confident in our ability to manage short-term challenges and believe we are well-positioned for long-term success.”
Quad continues to make progress on the Worldcolor integration