Quad/Graphics Reports Decline In Sales

Quad/Graphics, Inc. reported losses its fourth quarter and full-year 2011 sales results Tuesday, but company officials say they surpassed management's previously announced guidance. 

“We are pleased with our 2011 fourth quarter results, which reflect our ongoing focus on improving productivity and aggressively managing costs, while continuing to pay down debt to strengthen our credit metrics and balance sheet,” said Joel Quadracci, Quad/Graphics Chairman, President & CEO. “Given our strong finish to the year, as well as the strength of our recurring free cash flow and lower risk profile that our recent leverage reduction has provided, we are pleased to declare a 25% increase in our quarterly dividend, which will be payable on March 23, 2012, to shareholders of record on March 12, 2012.”

• Net sales for the fourth quarter in 2011 were $1.31 billion, down from $1.39 billion for the same period in 2010.
• In addition, fourth quarter 2011 earnings were $197 million, down from $224 million for the same period in 2010.

• Overall net loss for the fourth quarter in 2011 was $6.8 million.
• The comapny lost $46.6 million in total in 2011. 

Quad says these results were negatively impacted by volume and pricing pressures, primarily in Canada and in the U.S., as well as by debt arrangements in 2011 and non-recurring gains in 2010.

Offsetting these setbacks were things like productivity improvements, Quad said, which totaled $44 million during the quarter and $196 million since the Worldcolor acquisition.

For the full-year 2011, Quad/Graphics reported net sales were $4.67 billion versus net sales of $4.76 billion for the previous year. The company also lost $6.8 million in 

In addition, Quad says it continues to manage its outstanding debt and pension liabilities to maintain a strong balance that gives it flexibility to adjust to changing economic conditions.

“We are proud of the progress we have made to repay $163 million in debt during the fourth quarter of 2011, and $325 million since the Worldcolor acquisition,” said John Fowler, Executive Vice President & Chief Financial Officer. 

The Outlook for 2012

Officials at Quad/Graphics say they remains cautious about 2012 given the ongoing transformation in the industry.

“We anticipate our revenue to be approximately $4.0 billion, which excludes our discontinued operations in Canada that had 2011 revenues of $344 million,” Quadracci said.

• Quad announced it officially completed the sale of its Canadian operations to Transcontinental Inc. on Thursday.

“We will continue to aggressively manage what is within our control and make decisions that are in the best interests of our shareholders," Quadracci continued. "We remain confident in our strategy to redefine print in a multichannel world. Through the dedication and hard work of our employees, we continue to transform our company, making it leaner, stronger and poised for long-term stability and success.”