NYSE$ACCO

ACCO Brands Corporation · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Reported a decrease in net sales, but gross margin expanded due to pricing, productivity, and restructuring initiatives, resulting in better than expected adjusted EPS. Cautious on second half demand environment, but well positioned to end the year with a lower leverage ratio.

ACCO Brands reported a decrease in net sales but an increase in adjusted operating income due to improved gross margin. The company maintains its full-year adjusted EPS outlook and raises its free cash flow guidance.

  • Net sales of $494 million; gross margin expanding 450 basis points.
  • Operating income of $55 million, flat to prior year; adjusted operating income of $66 million grew 14% year over year.
  • EPS of $0.27; adjusted EPS of $0.38, above Company's outlook.
  • Raises full year 2023 free cash flow outlook to at least $110 million.

Headline financials

Total Revenue

$494M

Previous: $521M-5.3%
EPS (adj)

$0.38

Previous: $0.37+2.7%
Operating income margin

11.2%

No prior period
Income tax rate

37.1%

No prior period
Free Cash Flow

$26.4M

Previous: $32.4M-18.5%
Net Income

$26.4M

Previous: $39.4M-33.0%
Operating Income

$55.2M

Previous: $55.4M-0.4%
Gross Profit

$164M

Previous: $150M+9.5%
Cash & Equivalents

$82.4M

Previous: $91.7M-10.1%
Total Assets

$2.83B

Previous: $3.09B-8.6%
Stock-Based Comp

$3.3M

Previous: $2.3M+43.5%

Revenue & EPS history

ACCO Brands · Revenue · Quarterly

$494M

Q2 2023-5.3%vs Q2 2022
Beat estimate in 8 of 15 quarters(53%)
ActualEstimate

Forward guidance

The company is updating its full year 2023 outlook and providing a 3Q outlook.

Tailwinds

  • Maintaining full year adjusted EPS outlook of $1.08 to $1.12.
  • Mid-teen growth in adjusted operating income is expected.
  • Raising 2023 free cash flow outlook to at least $110 million.
  • Expects to end the year with a consolidated leverage ratio of 3.3x to 3.5x, lower than previously expected.
  • Third quarter includes approximately a 4 percent positive impact from foreign exchange.

Headwinds

  • Reported sales are expected to be down 1 percent to 3 percent for the full year.
  • Third quarter adjusted EPS is expected to be in the range of $0.21 to $0.24, compared to $0.25 in the prior-year third quarter.
  • Full year reported sales are expected to be down 1 percent to 3 percent.
  • Adjusted EPS is expected to be in the range of $0.21 to $0.24 for Q3.
  • Higher interest and non-cash non-operating pension expenses are expected to partially offset growth.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+1.7%

Avg return

Earnings day

+0.2%

Avg return

5 days after

-0.4%

Avg return

30 days after

48%

31 / 65 earnings

Positive

+26.2%

Q3 2016

Best reaction

-19.1%

Q3 2018

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+23.1%+25.5%+23.7%
Q4 2025-6.6%-13.6%-25.6%
Q3 2025-6.9%-4.6%-12.0%
Q1 2025-5.6%-8.0%-7.0%
Q4 2024-17.4%-17.6%-21.4%
Q3 2024+5.8%+16.9%+17.1%
Q2 2024-9.0%-9.0%+7.2%
Q1 2024+2.5%+3.2%+6.9%
Q4 2023-13.4%+8.0%-4.2%
Q3 2023-0.6%-5.5%+7.7%
Q2 2023-4.5%-7.3%-13.2%
Q1 2023+15.6%+16.3%+16.3%
Q4 2022-3.6%+1.4%-11.4%
Q3 2022+15.6%+19.7%+24.1%
Q2 2022-8.8%-2.2%-20.7%
Q1 2022-5.2%-6.4%-6.4%
Q4 2021+8.4%+10.2%+2.6%
Q3 2021-6.3%-6.7%-0.1%
Q2 2021+8.8%+8.1%+14.8%
Q1 2021+4.1%+0.4%+5.7%
Q4 2020-6.3%-7.6%-2.4%
Q3 2020-9.8%-15.4%+30.2%
Q2 2020+1.9%-5.0%-3.6%
Q1 2020-11.4%-10.3%-3.1%
Q4 2019+13.2%+7.1%-32.7%
Q3 2019-11.2%-8.6%-8.4%
Q2 2019+19.9%+18.1%+13.6%
Q1 2019-3.1%-4.5%-16.9%
Q4 2018-2.4%+0.5%-3.1%
Q3 2018-19.1%-10.2%-18.7%
Q2 2018-6.6%-5.9%-9.6%
Q1 2018-1.7%-2.1%+7.1%
Q4 2017+23.3%+22.4%+19.3%
Q3 2017+0.0%-1.5%+2.7%
Q2 2017-9.4%-6.4%-6.0%
Q1 2017-5.3%-11.6%-17.3%
Q4 2016+8.9%+7.8%+0.8%
Q3 2016+26.2%+21.8%+39.4%
Q2 2016-10.7%-11.2%-10.1%
Q1 2016+7.2%
Q4 2015+9.4%
Q3 2015-0.4%
Q2 2015+12.4%
Q1 2015-6.6%
Q4 2014-6.2%
Q3 2014+7.6%
Q2 2014+9.8%
Q1 2014+2.2%
Q4 2013+2.4%
Q3 2013-17.5%
Q2 2013-6.7%
Q1 2013-3.2%
Q4 2012-4.6%
Q3 2012+24.1%
Q2 2012-17.1%
Q1 2012+3.4%
Q1 2011+3.4%
Q4 2011+1.9%
Q4 2009+1.9%
Q3 2011+21.9%
Q3 2010+21.9%
Q4 2010+17.3%
Q2 2011+17.3%
Q2 2010+17.3%
Q1 2010-2.0%

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