NYSE$QUAD

Quad/Graphics Inc · Q4 2023 earnings

Q4 2023 earnings · · Investor relations

Briefing

Quad's Q4 2023 results were impacted by lower sales, increased interest expense, and lower pension income, offset by improved manufacturing productivity and cost reduction initiatives.

Quad reported a net sales decrease of 11% to $788 million in Q4 2023, with a net loss of $22 million compared to a net loss of $9 million in Q4 2022. Adjusted EBITDA decreased to $66 million from $79 million in the same period last year, while adjusted diluted earnings per share was $0.23, down from $0.41 in Q4 2022.

  • Net sales decreased by 11% to $788 million due to lower paper, print, and logistics sales, as well as the divestiture of the Argentina print operations.
  • Net loss was $22 million, compared to a net loss of $9 million in the fourth quarter of 2022, due to lower sales and increased interest expense.
  • Adjusted EBITDA was $66 million, compared to $79 million in the same period in 2022.
  • Adjusted Diluted Earnings Per Share was $0.23, compared to $0.41 in the fourth quarter of 2022.

Headline financials

Total Revenue

$788M

Previous: $885M-11.0%
EPS (adj)

$0.23

Previous: $0.41-43.9%
Capital Expenditures

-$11.3M

Previous: $10.8M-204.6%
Free Cash Flow

$95.2M

Previous: $174M-45.3%
Net Income

-$22M

Previous: -$8.7M-152.9%
Operating Income

$3.5M

Previous: $8.7M-59.8%
Gross Profit

-$960M

Previous: $178M-640.7%
Stock-Based Comp

$1M

Previous: $1.1M-9.1%

Revenue & EPS history

Quad · Revenue · Quarterly

$788M

Q4 2023-11%vs Q4 2022
Beat estimate in 4 of 14 quarters(29%)
ActualEstimate

Revenue by segment

Quad · $700M total across 2 segments · Q3 2023

  • United States Print and Related Services
    $608M-14.7%
  • International
    $92.2M-21.1%

Forward guidance

Quad anticipates revenue headwinds in 2024 but expects to increase Adjusted EBITDA margin due to $60 million in cost savings. The company will use strong cash generation to reduce Net Debt and has lowered its long-term targeted Net Debt Leverage range to 1.75x to 2.25x. Quad also expects to invest in its competitive position and return capital to shareholders through reinstated quarterly dividend and opportunistic share repurchases.

Tailwinds

  • Increase Adjusted EBITDA margin due to an anticipated $60 million in cost savings from recent plant capacity and labor reduction initiatives.
  • Use continued strong cash generation to further reduce Net Debt.
  • Lower long-term targeted Net Debt Leverage range to 1.75x to 2.25x.
  • Invest in accelerating our competitive position as an MX company.
  • Return capital to shareholders through our reinstated quarterly dividend.

Headwinds

  • Revenue headwinds will continue into 2024.
  • Expected postal rate increases for clients in 2024.
  • Loss of a long-standing client.
  • Managing through headwinds in core print business.
  • Ongoing economic uncertainty that negatively impacted print volumes.

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 2023

Historical avgQ4 2023

+0.3%

Avg return

Earnings day

-0.0%

Avg return

5 days after

-3.0%

Avg return

30 days after

52%

33 / 64 earnings

Positive

+33.9%

Q4 2017

Best reaction

-55.3%

Q3 2019

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-10.7%+1.8%-4.9%
Q4 2025+0.9%+6.7%-0.6%
Q3 2025-12.3%-10.7%-5.4%
Q1 2025-7.9%+6.0%+12.5%
Q4 2024+10.8%-11.8%-21.7%
Q3 2024+14.9%+24.5%+41.7%
Q2 2024-19.3%-26.0%-17.7%
Q1 2024-1.5%+4.6%+0.0%
Q4 2023-9.5%-17.8%-18.6%
Q3 2023-14.1%-9.5%-7.2%
Q2 2023-12.5%-4.6%-13.7%
Q1 2023-10.0%-17.3%-1.8%
Q4 2022+7.0%+21.4%-2.8%
Q3 2022+14.0%+18.0%+34.5%
Q2 2022+8.1%+9.4%+1.6%
Q1 2022-24.6%-25.2%-35.2%
Q4 2021+2.0%+9.8%+33.4%
Q3 2021+14.5%+8.1%-7.4%
Q2 2021+10.6%+37.9%+19.5%
Q1 2021-3.2%-13.7%-0.8%
Q4 2020-2.3%-16.7%-25.5%
Q3 2020-4.3%-6.1%+45.5%
Q2 2020+6.4%+4.5%+3.0%
Q1 2020-0.6%+9.4%+12.0%
Q4 2019+20.5%+14.7%-26.4%
Q3 2019-55.3%-57.3%-58.7%
Q2 2019+33.5%+34.5%+7.4%
Q1 2019-10.0%-9.0%-29.8%
Q4 2018+11.8%+8.3%-20.0%
Q3 2018-7.0%-11.9%-10.2%
Q2 2018+22.9%+8.5%+13.1%
Q1 2018-15.3%-25.5%-20.0%
Q4 2017+33.9%+25.6%+15.5%
Q3 2017+2.0%+4.5%+2.4%
Q2 2017-10.7%-14.2%-15.1%
Q1 2017+5.0%-1.6%-15.2%
Q4 2016-4.2%+4.0%-9.3%
Q3 2016+0.6%+1.8%+2.7%
Q2 2016+12.8%+14.0%+6.8%
Q1 2016+24.5%
Q4 2015+3.9%
Q3 2015-25.6%
Q2 2015-5.7%
Q1 2015-1.5%
Q4 2014+3.9%
Q3 2014-1.0%
Q2 2014-1.2%
Q1 2014-2.1%
Q4 2013-5.4%
Q3 2013-19.3%
Q2 2013+4.2%
Q1 2013+5.5%
Q4 2012+4.3%
Q3 2012-12.3%
Q2 2012-4.9%
Q1 2011+5.0%
Q1 2012+5.6%
Q4 2009+10.1%
Q4 2011+10.1%
Q3 2011+1.4%
Q2 2011+11.0%
Q4 2010+11.0%
Q3 2010-1.6%
Q2 2010+1.9%
Q1 2010

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