Quad/Graphics Inc · Q4 2020 earnings

Briefing

Quad's Q4 results were impacted by the pandemic and print industry pressures, but showed sequential revenue improvement. Cost discipline and productivity improvements drove margin and cash flow increases, while debt was reduced.

Quad reported a net sales of $843 million, a net loss of $86 million, and an adjusted EBITDA of $64 million for Q4 2020. Despite challenges from the COVID-19 pandemic and print industry pressures, the company achieved sequential revenue improvement and focused on cost management and debt reduction.

• Achieved second straight quarter of sequential improvement in Net Sales since the beginning of the pandemic.
• Aligned costs with demand environment throughout 2020 and achieved margin expansion while growing print segment share.
• Delivered cash from operating activities of $190 million and Free Cash Flow of $129 million; increases of $35 million and $23 million compared to 2019, respectively.
• Reduced debt by $184 million during 2020, ending the year with a Debt Leverage Ratio of 3.35x.

Headline financials

Revenue & EPS history

Quad expects to see sequential improvement in quarterly net sales trends in the first half of 2021 due to the improving impact of the pandemic and print segment share gains. Free Cash Flow is expected to decrease in 2021 due to the non-recurring nature of the CARES Act income tax refund received in 2020.