RR Donnelley Reports Big Revenue Decline, Small Profit
CHICAGO—Aug. 5, 2009—R.R. Donnelley & Sons Co. (NASDAQ:RRD) today reported second-quarter net earnings from continuing operations attributable to common shareholders of $25.2 million or $0.12 per diluted share on net sales of $2.4 billion compared to net earnings from continuing operations attributable to common shareholders of $145.1 million or $0.68 per diluted share on net sales of $2.9 billion in the second quarter of 2008.
The second-quarter net earnings from continuing operations attributable to common shareholders included pre-tax charges for restructuring ($40.1 million) and impairment ($8.1 million) totaling $48.2 million as well as acquisition-related expenses of $1.4 million in 2009 and for restructuring ($15.8 million) and impairment ($0.4 million) totaling $16.2 million in 2008. Substantially all of the restructuring charges in both the second quarter of 2009 and the second quarter of 2008 were associated with the reorganization of certain operations and the exiting of certain business activities.
The Company’s effective tax rate increased to 64.6% in the second quarter of 2009 from 33.5% in the second quarter of 2008 reflecting the Company’s expectation of a higher full-year effective tax rate in 2009. The higher full-year tax rate is primarily driven by the impact of foreign restructuring and impairment charges on which the Company does not expect to realize tax benefits at a rate equivalent to the U.S. statutory tax rate.
The company believes that certain non-GAAP measures, when presented in conjunction with comparable GAAP (Generally Accepted Accounting Principles) measures, are useful because that information is an appropriate measure for evaluating the company’s operating performance. Internally, the company uses this non-GAAP information as an indicator of business performance, and evaluates management’s effectiveness with specific reference to these indicators. These measures should be considered in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.