NYSE$DFIN

Donnelley Financial Solutions Inc · Q4 2024 earnings

Q4 2024 earnings · · Before market open · Investor relations

Briefing

Donnelley Financial Solutions reported lower net sales in Q4 2024 due to a decline in transactional revenue but maintained strong software solutions growth.

Donnelley Financial Solutions reported Q4 2024 net sales of $156.3 million, a decline of 11.4% year-over-year, primarily due to a reduction in capital markets and investment companies' transactional revenue. Software solutions net sales increased by 10.7%, representing 52.2% of total net sales. The company reported net earnings of $6.3 million and adjusted EBITDA of $31.7 million. Free cash flow for the quarter was $41.3 million.

  • Q4 2024 net sales were $156.3 million, an 11.4% decrease from the prior year.
  • Software solutions net sales grew 10.7% year-over-year to $81.6 million.
  • Net earnings were $6.3 million, or $0.21 per diluted share.
  • Adjusted EBITDA was $31.7 million with a margin of 20.3%.

Headline financials

Total Revenue

$156M

Previous: $177M-11.4%
EPS (adj)

$0.40

Previous: $0.61-34.4%
Adjusted EBITDA

$31.7M

Previous: $41.3M-23.2%
Adjusted EBITDA Margin

20.3%

Previous: 23.4%-13.2%
Gross Margin

50.7%

No prior period
Operating Margin

6.0%

No prior period
Non-GAAP Gross Profit

$93.7M

No prior period
Non-GAAP Gross Margin

59.9%

No prior period
SG&A as a % of total net sales

43.5%

No prior period
Effective Tax Rate

11.3%

No prior period
Gross Leverage

0.6

No prior period
Net Leverage

0.3

No prior period
Capital Expenditures

-$15.1M

Previous: -$18.8M+19.7%
Net Income

$6.3M

Previous: $10.6M-40.6%
Operating Income

$9.3M

Previous: $9.8M-5.1%
Gross Profit

$79.3M

Previous: $88.5M-10.4%

Revenue & EPS history

Donnelley Financial Solutions · Revenue · Quarterly

$156M

Q4 2024-11.4%vs Q4 2023
Beat estimate in 9 of 15 quarters(60%)
ActualEstimate

Revenue by segment

Donnelley Financial Solutions · $180M total across 3 segments · Q3 2023

  • Tech-enabled Services
    $80.4M-8.0%
  • Software Solutions
    $73.2M+5.3%
  • Print and Distribution
    $26.4M-17.0%

Forward guidance

DFIN remains optimistic about the growth of its software solutions segment and expects an improvement in transactional revenue in 2025.

Tailwinds

  • Software solutions net sales are expected to continue growing.
  • Company remains focused on cost discipline and operational efficiency.
  • Capital markets transactional activity has shown an early uptick in 2025.
  • DFIN maintains a strong liquidity position with $356.3 million available.
  • The company repurchased shares worth $17.4 million in Q4 2024.

Headwinds

  • Transactional revenue has been declining for three consecutive years.
  • Tech-enabled services and print segments continue to face demand challenges.
  • Adjusted EBITDA margin decreased by 310 basis points year-over-year.
  • Net sales declined despite software solutions growth.
  • Interest expenses and tax rates may impact future profitability.

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 Q4 2024

Historical avgQ4 2024

-2.6%

Avg return

Earnings day

-2.8%

Avg return

5 days after

-2.8%

Avg return

30 days after

40%

17 / 42 earnings

Positive

+25.5%

Q2 2022

Best reaction

-22.6%

Q4 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-0.6%-15.0%-23.6%
Q4 2025+12.3%+21.2%+20.0%
Q3 2025-14.3%-10.3%-5.1%
Q1 2025+3.9%+11.6%+17.4%
Q4 2024-22.6%-26.3%-32.5%
Q3 2024-11.6%-9.5%-5.7%
Q2 2024-7.0%-12.7%-4.0%
Q1 2024-0.6%+0.6%-2.9%
Q4 2023+3.2%+3.9%+1.4%
Q3 2023+1.8%+1.3%+6.9%
Q2 2023+1.0%+2.3%+6.2%
Q1 2023+1.6%+1.7%+8.9%
Q4 2022-14.6%-13.5%-22.0%
Q3 2022-18.9%-16.9%-8.9%
Q2 2022+25.5%+26.9%+17.0%
Q1 2022-14.6%-12.2%+0.4%
Q4 2021-3.9%+0.5%+3.3%
Q3 2021+15.4%+23.0%+12.5%
Q2 2021+10.4%+6.4%+5.3%
Q1 2021-16.4%-14.2%+1.1%
Q4 2020+14.4%+24.3%+20.9%
Q3 2020+2.6%-0.1%+22.4%
Q2 2020+23.1%+17.5%+9.9%
Q1 2020+13.1%+0.3%+35.6%
Q4 2019+1.4%+6.9%-37.3%
Q3 2019-16.4%-14.1%-10.4%
Q2 2019-1.0%-11.3%-22.0%
Q1 2019+6.4%+2.1%-18.3%
Q4 2018-12.0%-10.7%-7.8%
Q3 2018+6.9%+7.3%+1.1%
Q2 2018-10.4%-11.8%+0.8%
Q1 2018-7.3%-7.8%-17.8%
Q4 2017-15.4%-10.1%-14.2%
Q3 2017-8.2%-12.6%-4.5%
Q2 2017-5.9%-9.7%-7.7%
Q1 2016-2.2%-1.4%+2.6%
Q1 2017+3.6%-0.9%+15.7%
Q2 2016-13.9%-18.4%-25.9%
Q4 2016-13.9%-18.4%-25.9%
Q4 2014-13.9%-18.4%-25.9%
Q4 2015-5.5%-0.7%-2.0%
Q3 2016-5.5%-0.7%-2.0%
Q3 2015
Q2 2015
Q1 2015

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