RR Donnelley (RRD) Tops Q1 EPS by 37c, Revenues Beat

RR Donnelley (NYSE: RRD) reported Q1 EPS of $0.33, $0.37 better than the analyst estimate of ($0.04). Revenue for the quarter came in at $1.41 billion versus the consensus estimate of $1.38 billion.

First quarter key messages

• GAAP net sales decreased 7.4%; non-GAAP organic net sales decreased 1.3%, which included a 2.9 percentage point reduction due to the COVID-19 impact in China
• GAAP income from operations down $14.5 million due to a non-cash goodwill impairment charge of $20.6 million; non-GAAP adjusted income from operations increased $18.7 million while adjusted operating margin improved 150 basis points
• GAAP loss per share of $0.18 included a first quarter goodwill impairment charge of $0.29; non-GAAP adjusted earnings per share of $0.33 increased $0.39 from prior year
• Continued strategic focus to optimize business portfolio – completed sale of Logistics Courier business and exited operations in Chile
• Operating cash flow improved $50.4 million from prior year; capital expenditures down $19.7 million
• Proactively increased borrowings on revolving credit facility to preserve financial flexibility; cash on hand was $450.7 million

“2020 started very strong with our best first quarter adjusted income from operations and adjusted earnings per share since the spin in 2016,” said Dan Knotts, RRD President and Chief Executive Officer. “During the quarter, we continued to aggressively drive our strategic priorities to improve our core operating performance and optimize our business portfolio, and the impact of those actions is reflected in our results. We also improved our debt profile by executing a series of transactions to extend our mid-term debt maturities and reduce our near-term debt maturities amidst a challenging capital markets environment. Looking ahead, we remain steadfast in our commitment to protect the health and safety of our teams around the world as we navigate these uncertain times. We are highly focused on the execution of our strategic initiatives and are taking decisive actions to mitigate the challenges created by this global pandemic.”

For earnings history and earnings-related data on RR Donnelley (RRD) click here.

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