ACCO BRANDS CORPORATION LAKE ZURICH, Ill., Oct. 29, 2014 /PRNewswire/ -- ACCO Brands Corporation (NYSE: ACCO), a world leader in branded school and office products, today reported its third quarter results for the period ended September 30, 2014.
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"We gained market share and had a strong back-to-school season in North America," said Boris Elisman, president and chief executive officer. "Disciplined expense management and ongoing productivity initiatives also contributed to our earnings growth. As a result of our strong third quarter, we are increasing our revenue and adjusted earnings guidance for the full year and reiterating our free cash flow guidance."
Third Quarter Results
Net sales increased 1% to $472.2 million compared to $469.2 million in the prior-year quarter. Net income was $34.2 million, or $0.29 per share. This compared to net income of $26.4 million, or $0.23 per share, in the prior-year quarter. Adjusted net income increased 21% to $35.2 million, or $0.30 per share, compared to $29.1 million, or $0.25 per share, in the prior-year quarter. The increase primarily was the result of cost savings and productivity improvements.
Business Segment Highlights
ACCO Brands North America - Sales increased to $297.4 million from $295.9 million in the prior-year quarter. On a constant currency basis, sales increased 1% driven by a strong back-to-school season, including market share gains in the mass channel, and pricing, which more than offset declines with a large customer that recently merged. Operating income was $50.5 million, compared to $36.1 million in the prior-year quarter. Adjusted operating income increased 29% to $50.0 million, from $38.7 million in the prior-year quarter, primarily due to cost savings and productivity improvements.
ACCO Brands International - Sales increased 3% to $140.7 million, from $136.0 million in the prior-year quarter, driven by growth in Brazil and Mexico. Operating income was $19.1 million compared to $17.8 million in the prior-year quarter. Adjusted operating income increased 3% to $19.2 million, compared to $18.7 million in the prior-year quarter, primarily due to the increase in sales.
Computer Products - Sales decreased 9% to $34.1 million, from $37.3 million in the prior-year quarter, due to lower tablet accessory sales resulting from our de-emphasis of commoditized products. Operating income decreased to $2.7 million from $3.4 million in the prior-year quarter. Adjusted operating income was $3.6 million compared to $3.4 million in the prior-year quarter. The improvement was due to favorable product mix and lower operating expenses.
Nine Month Results
Net sales decreased 2.5% to $1,229.3 million compared to $1,261.4 million in the prior-year nine-month period. On a constant currency basis sales decreased 1.2%. Net income was $47.7 million, or $0.41 per share, including restructuring costs. This compared to net income of $26.9 million, or $0.23 per share, in the prior-year period, including restructuring, debt refinancing and IT integration costs. Adjusted net income increased 20% to $51.6 million, or $0.44 per share, from $42.9 million, or $0.37 per share, in the prior year period. The improvement primarily was the result of cost savings and productivity improvements and lower interest expense.
Business Outlook
The company has increased its expectations for 2014 sales and adjusted earnings per share. The company now expects a lesser rate of sales decline, down 3-5%, and adjusted earnings per share of $0.79-$0.80. The company continues to expect 2014 free cash flow of approximately $140 million.
Webcast
At 8:30 a.m. Eastern Time today, ACCO Brands Corporation will host a conference call to discuss the company's 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 for one month following the event.
Non-GAAP Financial Measures
To supplement our consolidated financial statements presented on a GAAP basis in this earnings release, we provide investors with certain non-GAAP financial measures, including "adjusted" financial measures, earnings before interest, taxes and depreciation ("EBITDA"), and free cash flow. See our Reconciliations of Adjusted Results, Reconciliations of Operating Income to Adjusted Supplemental EBITDA from Continuing Operations, Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow and our Reported Supplemental Business Segment Information and Reconciliation, for a description of each of these non-GAAP financial measures and a reconciliation to the most directly comparable GAAP financial measure for each of the periods presented herein. We believe these non-GAAP financial measures are appropriate to enhance an overall understanding of our past financial performance and also our prospects for the future, as well as to facilitate comparisons with our historical operating results. Adjustments to our GAAP results are made with the intent of providing both management and investors a more complete understanding of our underlying operational results and trends. For example, the non-GAAP results are an indication of our baseline performance before gains, losses or other charges that are considered by management to be outside our core operating results. In addition, these non-GAAP financial measures are among the primary indicators management uses as a basis for our planning and forecasting of future periods.
There are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles and may be different from non-GAAP financial measures used by other companies. The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results; such as unusual tax items, restructuring and integration charges, goodwill or other intangible asset impairment charges, and other one-time or non-recurring items. The presentation of this additional information is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with generally accepted accounting principles in the United States. Investors should review the reconciliations of the non-GAAP financial measures to their most directly comparable GAAP financial measures as provided in the tables accompanying this press release.
About ACCO Brands Corporation
ACCO Brands Corporation is one of the world's largest suppliers of branded school, office and consumer products and print finishing solutions. Our widely recognized brands include AT-A-GLANCE®, Day-Timer®, Five Star®, GBC®, Hilroy®, Kensington®, Marbig, Mead®, NOBO, Quartet®, Rexel, Swingline®, Tilibra®, Wilson Jones® and many others. We design, market and sell products in more than 100 countries around the world. More information about ACCO Brands can be found at www.accobrands.com.
Forward-Looking Statements
This press release contains statements which may be "forward-looking statements" within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to certain risks and uncertainties, are made as of the date hereof and we undertake no obligation to update them. In particular, our business outlook is based on certain assumptions which we believe to be reasonable under the circumstances. These include, without limitation, assumptions regarding changes in the macro environment, fluctuations in foreign currency rates, changes in the competitive landscape and consumer behavior and the effect of consolidation in the office products industry, as well as other factors described below.
Our ability to predict results or the actual effect of future plans or strategies is inherently uncertain. Because actual results may differ from those predicted by such forward-looking statements, you should not place undue reliance on them when deciding whether to buy, sell or hold the Company's securities.
Among the factors that could affect our results or cause our plans, actions and results to differ materially from current expectations are: the concentration of our business with a relatively limited number of large and sophisticated customers, and the impact of the loss or bankruptcy of a major customer or a substantial reduction in business from a major customer due to their loss of market share or otherwise; the consolidation of our customers, including the merger of Office Depot and OfficeMax in late 2013; challenges related to the highly competitive business segments in which we operate, including, without limitation, decisions made by our major customers to expand the sourcing of their own private label products or otherwise change product assortments, decisions by our competitors to take advantage of low entry barriers to expand their production or lower prices, and decisions made by end-users of our products to purchase lowered-priced, substitute or alternative products; our ability to anticipate the changing needs of our customers and end-users in a market where many of our product categories are affected by continuous improvements in technology and shortened product life cycles and others are experiencing secular declines; our ability to meet the competitive challenges faced by our Computer Products business which is characterized by rapid change, including changes in technology, short product life cycles and a dependency on the introduction by third party manufacturers of new equipment to drive demand for the accessories it sells; commercial and consumer spending decisions during periods of economic uncertainty or weakness; our ability to realize the sales synergies, growth opportunities and other potential benefits of the acquisition of the Mead Consumer and Office Products business; our ability to successfully expand our business in new, developing and emerging markets and sales channels which could create exposure to unstable political conditions, civil unrest or economic uncertainty; any material failure, inadequacy or interruption in our information technology systems; our failure to remediate the material weakness in our information technology general controls; regulatory requirements, litigation, regulatory actions or other legal proceedings; the risks associated with outsourcing production of certain of our products to suppliers in China and other Asia-Pacific countries; the decline in the use of paper-based dated time management and productivity tools; material disruptions at one of our or our suppliers' major manufacturing or distribution facilities; risks associated with our substantial indebtedness, including limitations imposed by restrictive covenants and our ability to comply with financial ratios and tests; risks associated with seasonality, and foreign currency, interest rate and raw material and labor cost fluctuations; the impact of pension costs; any impairment of our goodwill or other intangible assets; our ability to secure, protect and maintain our intellectual property rights; our ability to retain key employees; 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, 2013 and in other reports we file with the SEC.
ACCO Brands Corporation and Subsidiaries
Condensed Consolidated Balance Sheets
September 30, December 31,
2014 2013
---- ----
(in millions of dollars) (unaudited)
Assets
Current assets:
Cash and cash equivalents $72.5 $53.5
Accounts receivable, net 386.8 471.9
Inventories 286.2 254.7
Deferred income taxes 37.3 33.5
Other current assets 41.6 28.1
---- ----
Total current assets 824.4 841.7
Total property, plant and
equipment 552.1 548.5
Less accumulated depreciation (309.4) (295.2)
------ ------
Property, plant and equipment,
net 242.7 253.3
Deferred income taxes 30.9 37.3
Goodwill 558.2 568.3
Identifiable intangibles, net 584.7 607.0
Other non-current assets 68.6 75.3
---- ----
Total assets $2,309.5 $2,382.9
======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable $0.8 $ -
Current portion of long-term
debt 0.2 0.1
Accounts payable 150.9 177.9
Accrued compensation 34.2 32.0
Accrued customer program
liabilities 96.9 123.6
Accrued interest 15.2 7.0
Other current liabilities 74.9 104.5
---- -----
Total current liabilities 373.1 445.1
Long-term debt 895.6 920.8
Deferred income taxes 185.1 169.1
Pension and post-retirement
benefit obligations 45.0 61.7
Other non-current liabilities 82.7 83.9
---- ----
Total liabilities 1,581.5 1,680.6
------- -------
Stockholders' equity:
Common stock 1.1 1.1
Treasury stock (5.4) (3.5)
Paid-in capital 2,040.8 2,035.0
Accumulated other
comprehensive loss (211.5) (185.6)
Accumulated deficit (1,097.0) (1,144.7)
-------- --------
Total stockholders' equity 728.0 702.3
----- -----
Total liabilities and
stockholders' equity $2,309.5 $2,382.9
======== ========
ACCO Brands Corporation and Subsidiaries
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Nine Months Ended September 30,
-------------------------------
(in millions of
dollars) 2014 2013
---- ----
Operating activities
Net income $47.7 $26.9
Loss (gain) on
disposal of
assets 0.6 (2.3)
Release of tax
valuation
allowance - (7.0)
Depreciation 26.8 30.4
Other non-cash
charges 0.6 0.9
Amortization of
debt issuance
costs 2.9 4.3
Amortization of
intangibles 16.9 18.7
Stock-based
compensation 11.6 11.7
Loss on debt
extinguishment - 9.4
Equity in
earnings of
joint ventures,
net of dividends
received (0.4) (0.9)
Changes in balance sheet
items:
Accounts
receivable 72.3 85.5
Inventories (37.5) (30.9)
Other assets (10.1) (5.8)
Accounts payable (23.2) 20.7
Accrued expenses
and other
liabilities (49.0) (27.3)
Accrued income
taxes 8.3 (9.1)
--- ----
Net cash provided
by operating
activities 67.5 125.2
Investing activities
Additions to
property, plant
and equipment (21.1) (30.2)
Payments related
to the sale of
discontinued
operations - (1.4)
Proceeds from the
disposition of
assets 3.8 4.2
Net cash used by
investing
activities (17.3) (27.4)
Financing activities
Proceeds from
long-term
borrowings - 530.0
Repayments of
long-term debt (25.1) (601.5)
Borrowings of
notes payable,
net 0.8 1.1
Payments for debt
issuance costs (0.3) (4.3)
Repurchase of
common stock (2.9) -
Other (1.9) (0.6)
---- ----
Net cash used by
financing
activities (29.4) (75.3)
Effect of foreign
exchange rate
changes on cash
and cash
equivalents (1.8) (1.7)
---- ----
Net increase in
cash and cash
equivalents 19.0 20.8
Cash and cash equivalents
Beginning of the
period 53.5 50.0
---- ----
End of the period $72.5 $70.8
===== =====
ACCO Brands Corporation
Consolidated Statements of Income and Reconciliation of Adjusted Results (Unaudited)
(In millions of dollars, except per share data)
Three Months Ended September 30, 2014 Three Months Ended September 30, 2013
------------------------------------- -------------------------------------
Adjusted Adjusted % Change % Change
Reported Items (A) Adjusted Reported Items (A) Adjusted Reported Adjusted
-------- -------- -------- -------- -------- -------- -------- --------
Net sales $472.2 $ - $472.2 $469.2 $ - $469.2 1% 1%
Cost of products
sold 320.3 - 320.3 328.1 - 328.1 (2)% (2)%
----- --- ----- ----- --- -----
Gross profit 151.9 - 151.9 141.1 - 141.1 8% 8%
Operating costs and
expenses:
Advertising,
selling, general
and administrative
expenses 84.2 - 84.2 82.6 (1.3) (A.1) 81.3 2% 4%
Amortization of
intangibles 5.4 - 5.4 5.9 - 5.9 (8) (8)%
%
Restructuring
charges 0.5 (0.5) (A.2) - 2.3 (2.3) (A.2) - (78)% NM
--- ---- --- --- ---- ---
Total operating
costs and expenses 90.1 (0.5) 89.6 90.8 (3.6) 87.2 (1)% 3%
---- ---- ---- ---- ---- ----
Operating income 61.8 0.5 62.3 50.3 3.6 53.9 23% 16%
Non-operating
expense (income):
Interest expense,
net 10.9 - 10.9 12.5 (0.1) (A.3) 12.4 (13)% (12)%
Equity in earnings
of joint ventures (2.9) - (2.9) (3.3) - (3.3) (12)% (12)%
Other expense, net 0.2 - 0.2 0.1 - 0.1 100% 100%
--- --- --- --- --- ---
Income from
continuing
operations before
income tax 53.6 0.5 54.1 41.0 3.7 44.7 31% 21%
Income tax expense 19.4 (0.5) (A.4) 18.9 14.6 1.0 (A.4) 15.6 33% 21%
---- ---- --- ----
Income from
continuing
operations 34.2 1.0 35.2 26.4 2.7 29.1 30% 21%
Loss from
discontinued
operations, net of
income taxes - - - - - -
--- --- --- --- --- ---
Net income $34.2 $1.0 $35.2 $26.4 $2.7 $29.1 30% 21%
===== ==== ===== ===== ==== =====
Per share:
Basic income per
share:
Income from
continuing
operations $0.30 $0.31 $0.23 $0.26 30% 19%
Loss from
discontinued
operations - - - -
Basic income per
share $0.30 $0.31 $0.23 0.26 30% 19%
Diluted income per
share:
Income from
continuing
operations $0.29 $0.30 $0.23 $0.25 26% 20%
Loss from
discontinued
operations - - - $ -
Diluted income per
share $0.29 $0.30 $0.23 $0.25 26% 20%
Weighted average
number of shares
outstanding:
Basic 114.4 114.4 113.6 113.6
Diluted 117.0 117.0 115.8 115.8
Statistics (as a % of Net sales, except Income tax rate)
Three Months Ended Three Months Ended
September 30, 2014 September 30, 2013
------------------- -------------------
Reported Adjusted Reported Adjusted
-------- -------- -------- --------
Gross profit (Net
sales, less Cost
of products sold) 32.2% 30.1%
Advertising,
selling, general
and administrative 17.8% 17.6% 17.3%
Operating income 13.1% 13.2% 10.7% 11.5%
Income from
continuing
operations before
income tax 11.4% 11.5% 8.7% 9.5%
Income from
continuing
operations 7.2% 7.5% 5.6% 6.2%
Income tax rate 36.2% 35.0% 35.6% 35.0%
--------------- ---- ---- ---- ----
Reconciliation of Operating Income to Adjusted Supplemental EBITDA from Continuing Operations
(Unaudited)
(In millions of dollars)
"Adjusted Supplemental EBITDA" represents adjusted operating income after adding back depreciation, amortization of intangibles, stock-based
compensation expense, and joint venture income. The following table sets forth a reconciliation of operating income in accordance with GAAP to Adjusted
Supplemental EBITDA
Three Months Ended September 30,
--------------------------------
2014 2013 % Change
---- ---- --------
Operating income $61.8 $50.3 23%
Integration charges - 1.3 (100)%
Restructuring charges 0.5 2.3 (78)%
-----------
Adjusted operating income
from continuing operations 62.3 53.9 16%
Depreciation 8.5 9.8 (13)%
Amortization of intangibles 5.4 5.9 (8)%
Stock-based compensation expense 3.9 4.3 (9)%
Joint venture income 2.9 3.3 (12)%
-----------
Adjusted supplemental EBITDA
from continuing operations $83.0 $77.2 8%
===== =====
Adjusted supplemental EBITDA
from continuing operations as
a % of Net Sales 17.6% 16.5%
Notes for Reported Consolidated Statements of Income
and Reconciliation of Adjusted Reported Results
A. "Adjusted"
results exclude
all unusual tax
items,
restructuring
and integration
charges, in
order to provide
a comparison of
underlying
results of
operations; in
addition, taxes
have been
recalculated at
a normalized tax
rate.
1. Represents integration charges.
2. Represents restructuring costs.
Primarily represents the
adjustments related to
accelerated amortization of
debt origination costs
resulting from bank debt
3. repayments.
4. Adjustment primarily reflects
the tax effect of the
adjustments outlined in items
A.1-3 above and adjusts the
company's effective tax rate to
a normalized rate of 35%. The
Company incurred significant
operating losses in several
jurisdictions in prior periods.
As a result, the operating
results in these locations
reflected no tax benefit or
expense, which results in a
high effective tax rate for the
prior-year period. The
Company's principal remaining
tax valuation allowance for the
Netherlands was reversed during
the first quarter of 2013. The
Company's estimated long-term
rate remains subject to
variations from the mix of
earnings across the Company's
operating jurisdictions.
ACCO Brands Corporation
Consolidated Statements of Income and Reconciliation of Adjusted Results (Unaudited)
(In millions of dollars, except per share data)
Nine Months Ended September 30, 2014 Nine Months Ended September 30, 2013
------------------------------------ ------------------------------------
Adjusted Adjusted % Change % Change
Reported Items (A) Adjusted Reported Items (A) Adjusted Reported Adjusted
-------- -------- -------- -------- -------- -------- -------- --------
Net sales $1,229.3 $ - $1,229.3 $1,261.4 $ - $1,261.4 (3)% (3)%
Cost of products
sold 858.5 - 858.5 886.5 - 886.5 (3)% (3)%
----- --- ----- ----- -----
Gross profit 370.8 - 370.8 374.9 - 374.9 (1)% (1)%
Operating costs and
expenses:
Advertising,
selling, general
and administrative
expenses 247.2 - 247.2 259.3 (4.4) (A.1) 254.9 (5)% (3)%
Amortization of
intangibles 16.9 - 16.9 18.7 - 18.7 (10)% (10)%
Restructuring
charges 1.6 (1.6) (A.2) - 17.9 (17.9) (A.2) - (91)% NM
--- --- ---- ---
Total operating
costs and expenses 265.7 (1.6) 264.1 295.9 (22.3) 273.6 (10)% (3)%
----- ---- ----- ----- ----- -----
Operating income 105.1 1.6 106.7 79.0 22.3 101.3 33% 5%
Non-operating
expense (income):
Interest expense,
net 32.3 0.1 (A.3) 32.4 41.7 (0.8) (A.3) 40.9 (23)% (21)%
Equity in earnings
of joint ventures (5.3) - (5.3) (5.9) - (5.9) (10)% (10)%
Other expense, net 0.3 - 0.3 9.6 (9.4) (A.4) 0.2 (97)% 50%
--- --- --- --- ---- ---
Income (loss) from
continuing
operations before
income tax 77.8 1.5 79.3 33.6 32.5 66.1 132% 20%
Income tax expense
(benefit) 30.1 (2.4) (A.5) 27.7 6.6 16.5 (A.5) 23.1 356% 20%
---- ---- ---- --- ----
Income from
continuing
operations 47.7 3.9 51.6 27.0 16.0 43.0 77% 20%
Loss from
discontinued
operations, net of
income taxes - - - (0.1) - (0.1) 100% 100%
--- --- --- ---- ----
Net income $47.7 $3.9 $51.6 $26.9 $16.0 $42.9 77% 20%
===== ==== ===== ===== ===== =====
Per share:
Basic income per
share:
Income from
continuing
operations $0.42 $0.45 $0.24 0.38 75% 18%
Loss from
discontinued
operations - - - - 100% 100%
Basic income per
share $0.42 $0.45 $0.24 0.38 75% 18%
Diluted income per
share:
Income from
continuing
operations $0.41 $0.44 $0.23 0.37 78% 19%
Loss from
discontinued
operations - - - - 100% 100%
Diluted income per
share $0.41 $0.44 $0.23 0.37 78% 19%
Weighted average
number of shares
outstanding:
Basic 114.2 114.2 113.5 113.5
Diluted 116.7 116.7 115.6 115.6
Statistics (as a % of Net sales, except Income tax rate)
Nine Months Ended Nine Months Ended
September 30, 2014 September 30, 2013
------------------ ------------------
Reported Adjusted Reported Adjusted
-------- -------- -------- --------
Gross profit (Net
sales, less Cost
of products sold) 30.2% 29.7%
Advertising,
selling, general
and administrative 20.1% 20.6% 20.2%
Operating income 8.5% 8.7% 6.3% 8.0%
Income (loss) from
continuing
operations before
income tax 6.3% 6.5% 2.7% 5.2%
Income from
continuing
operations 3.9% 4.2% 2.1% 3.4%
Income tax rate 38.7% 35.0% 19.6% 35.0%
--------------- ---- ---- ---- ----
Reconciliation of Operating Income to Adjusted Supplemental EBITDA from Continuing Operations
(Unaudited)
(In millions of dollars)
"Adjusted Supplemental EBITDA" represents adjusted operating income after adding back depreciation, amortization of intangibles, stock-based compensation
expense, and joint venture income. The following table sets forth a reconciliation of reported operating income in accordance with GAAP to Adjusted
Supplemental EBITDA.
Nine Months Ended September 30,
-------------------------------
2014 2013 % Change
---- ---- --------
Operating income $105.1 $79.0 33%
Integration charges - 4.4 (100)%
Restructuring charges 1.6 17.9 (91)%
------------
Adjusted operating income
from continuing operations 106.7 101.3 5%
Depreciation 26.8 30.4 (12)%
Amortization of intangibles 16.9 18.7 (10)%
Stock-based compensation expense 11.6 11.7 (1)%
Joint venture income 5.3 5.9 (10)%
------------
Adjusted supplemental EBITDA
from continuing operations $167.3 $168.0 - %
====== ======
Adjusted supplemental EBITDA
from continuing operations as
a % of Net Sales 13.6% 13.3%
Notes for Reported Consolidated Statements of Income and Reconciliation of Adjusted Reported Results
A. "Adjusted" results exclude all unusual tax items, restructuring and integration charges, in
order to provide a comparison of underlying results of operations; in addition, taxes have
been recalculated at a normalized tax rate.
1. Represents integration charges.
2. Represents restructuring costs.
3. Primarily represents the adjustments related to accelerated amortization of debt origination costs resulting from bank debt repayments.
4. Represents the reversal of the loss on debt extinguishment and other costs associated with the Company's refinancing in Q2 of 2013.
5. Adjustment primarily reflects the tax effect of the adjustments outlined in items A.1-4 above and adjusts the company's effective tax rate to a normalized rate of 35%. The Company incurred significant operating losses in
several jurisdictions in prior periods. As a result, the operating results in these locations reflected no tax benefit or expense, which results in a high effective tax rate for the prior-year period. The Company's
principal remaining tax valuation allowance for the Netherlands was reversed during the first quarter of 2013. The Company's estimated long-term rate remains subject to variations from the mix of earnings across the
Company's operating jurisdictions.
Reconciliation of Net Cash Provided By
Operating Activities to Free Cash
Flow
(Unaudited)
(In millions of dollars)
"Free Cash Flow" represents cash flow
from operating activities less
additions to property, plant and
equipment, net of proceeds from the
disposition of assets. The following
table sets forth a reconciliation of
reported net cash provided by
operating activities in accordance
with GAAP to Free Cash Flow.
Nine Months
Ended
September
30, 2014
------------
Net cash provided by
operating activities $67.5
Net cash provided (used) by:
Additions to property, plant
and equipment (21.1)
Proceeds from the disposition
of assets 3.8
Free cash flow 50.2
====
ACCO Brands Corporation
Reported Supplemental Business Segment Information and Reconciliation (Unaudited)
(In millions of dollars)
2014 2013 Changes
---- ---- -------
Adjusted Adjusted
Operating
Reported Adjusted Reported Adjusted Operating Adjusted Adjusted
Income
Operating Operating Operating Operating Income Operating Operating
Income Adjusted Income (Loss) Income Adjusted Income (Loss) Net Sales Net Sales Income Income Margin
Net Sales (Loss) Items Loss(A) Margin Net Sales (Loss) Items (Loss)(A) Margin $ % (Loss)$ (Loss)% Points
--------- ----- ----- ------ ------ --------- ----- ----- -------- ------ --- --- ------- ------ ------
ACCO Brands
North America $171.4 $(1.5) $0.3 $(1.2) (0.7)% $189.0 $(8.2) $5.7 $(2.5) (1.3)% $(17.6) (9)% $1.3 52% 60
ACCO Brands
International 124.3 7.6 0.5 8.1 6.5% 126.2 4.0 4.6 8.6 6.8% $(1.9) (2)% (0.5) (6)% (30)
Computer
Products 33.7 1.9 0.3 2.2 6.5% 36.8 2.8 0.6 3.4 9.2% $(3.1) (8)% (1.2) (35)% (270)
Corporate - (8.6) - (8.6) - (7.8) - (7.8) - (0.8)
--- ---- --- ---- --- ---- --- ---- --- ----
Total $329.4 $(0.6) $1.1 $0.5 0.2% $352.0 $(9.2) $10.9 $1.7 0.5% $(22.6) (6)% $(1.2) (71)% (30)
====== ===== ==== ==== ====== ===== ===== ==== ====== =====
Q2:
ACCO Brands
North America $283.7 $49.0 $0.2 $49.2 17.3% $286.9 $33.7 $7.1 $40.8 14.2% $(3.2) (1)% $8.4 21% 310
ACCO Brands
International 111.3 5.2 - 5.2 4.7% 116.1 10.5 (0.2) 10.3 8.9% $(4.8) (4)% (5.1) (50)% (420)
Computer
Products 32.7 0.4 - 0.4 1.2% 37.2 2.9 0.7 3.6 9.7% $(4.5) (12)% (3.2) (89)% (850)
Corporate - (10.7) (0.2) (10.9) - (9.2) 0.2 (9.0) - (1.9)
--- ----- ---- ----- --- ---- --- ---- --- ----
Total $427.7 $43.9 $ - $43.9 10.3% $440.2 $37.9 $7.8 $45.7 10.4% $(12.5) (3)% $(1.8) (4)% (10)
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Q3:
ACCO Brands
North America $297.4 $50.5 $(0.5) $50.0 16.8% $295.9 $36.1 $2.6 $38.7 13.1% $1.5 1% $11.3 29% 370
ACCO Brands
International 140.7 19.1 0.1 19.2 13.6% 136.0 17.8 0.9 18.7 13.8% $4.7 3% 0.5 3% (20)
Computer
Products 34.1 2.7 0.9 3.6 10.6% 37.3 3.4 - 3.4 9.1% $(3.2) (9)% 0.2 6% 150
Corporate - (10.5) - (10.5) - (7.0) 0.1 (6.9) - (3.6)
--- ----- --- ----- --- ---- --- ---- --- ----
Total $472.2 $61.8 $0.5 $62.3 13.2% $469.2 $50.3 $3.6 $53.9 11.5% $3.0 1% $8.4 16% 170
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Q4:
ACCO Brands North America $269.6 $36.6 $9.7 $46.3 17.2%
ACCO Brands International 188.3 34.2 1.2 35.4 18.8%
Computer Products 45.8 4.6 0.8 5.4 11.8%
Corporate - (8.6) 0.5 (8.1)
--- ---- --- ----
Total $503.7 $66.8 $12.2 $79.0 15.7%
====== ===== ===== =====
Full Year:
ACCO Brands
North America $752.5 $98.0 $ - $98.0 13.0% $1,041.4 $98.2 $25.1 $123.3 11.8%
ACCO Brands
International 376.3 31.9 0.6 32.5 8.6% 566.6 66.5 6.5 73.0 12.9%
Computer
Products 100.5 5.0 1.2 6.2 6.2% 157.1 13.7 2.1 15.8 10.1%
Corporate - (29.8) (0.2) (30.0) - (32.6) 0.8 (31.8)
--- ----- ---- ----- --- ----- --- -----
Total $1,229.3 $105.1 $1.6 $106.7 8.7% $1,765.1 $145.8 $34.5 $180.3 10.2%
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(A) See "Notes for Reported Consolidated Statements of Income and Reconciliation of Adjusted Reported Results" for a description of adjusted items on pages 8 and 10.
ACCO Brands Corporation
Supplemental Net Sales Growth Analysis
(Unaudited)
Percent Change - Sales
----------------------
Net Comparable
Sales Currency Sales
Growth Translation Growth Price $ Volume/Mix
------ ----------- ------ ----- ------------
Q1 2014:
ACCO Brands North America (9.4)% (1.3)% (8.1)% 0.6% (8.7)%
ACCO Brands International (1.5)% (7.3)% 5.8% 2.4% 3.4%
Computer Products (8.4)% 0.3% (8.7)% (4.9)% (3.8)%
----- --- ----- ----- -----
Total (6.4)% (3.3)% (3.1)% 0.7% (3.8)%
Q2 2014:
ACCO Brands North America (1.1)% (1.0)% (0.1)% 1.4% (1.5)%
ACCO Brands International (4.1)% (0.9)% (3.2)% 4.1% (7.3)%
Computer Products (12.1)% 1.1% (13.2)% (3.0)% (10.2)%
------ --- ------ ----- ------
Total (2.8)% (0.8)% (2.0)% 1.7% (3.7)%
Q3 2014:
ACCO Brands North America 0.5% (0.7)% 1.2% 2.1% (0.9)%
ACCO Brands International 3.5% 0.8% 2.7% 3.2% (0.5)%
Computer Products (8.6)% (0.3)% (8.3)% (3.5)% (4.8)%
----- ----- ----- ----- -----
Total 0.6% (0.2)% 0.8% 2.0% (1.2)%
2014 YTD:
ACCO Brands North America (2.5)% (0.9)% (1.6)% 1.5% (3.1)%
ACCO Brands International (0.5)% (2.4)% 1.9% 3.2% (1.3)%
Computer Products (9.7)% 0.4% (10.1)% (3.8)% (6.3)%
----- --- ------ ----- -----
Total (2.5)% (1.3)% (1.2)% 1.5% (2.7)%
----- -----
Logo - http://photos.prnewswire.com/prnh/20130114/CG41611LOGO-b
SOURCE ACCO Brands Corporation
