Consumables

ACCO Brands Corporation Reports First Quarter 2014 Results

Friday 02. May 2014 - ACCO Brands Corporation (NYSE: ACCO), a world leader in branded school and office products, today reported its first quarter results for the period ended March 31, 2014.

“Our first quarter results met our sales and earnings expectations,” said Boris Elisman, president and chief executive officer.  “We are pleased with our execution and are managing the challenges of the industry well.  We are reiterating our revenue, adjusted earnings and cash flow guidance for the full year.”
First Quarter Results
Net sales decreased 6% to $329.4 million, compared to $352.0 million in the prior-year quarter. On a constant currency basis, sales declined 3% driven primarily by lower volume and mix.  Loss from continuing operations was $7.8 million, or $0.07 per share, including pre-tax net charges of $1.1 million for restructuring costs.  This compared to a loss from continuing operations of $8.9 million, or $0.08 per share, in the prior-year quarter, including pre-tax net charges of $11.4 million primarily for restructuring and IT integration costs.  Adjusted loss from continuing operations in the current quarter improved 22% to $6.2 million, or $0.05 per share, compared to a loss of $7.9 million, or $0.07 per share, in the prior-year quarter.  The improvement was the result of lower operating and interest expenses.
Business Segment Highlights
ACCO Brands North America – Sales decreased 9% to $171.4 million from $189.0 million in the prior-year quarter.  On a constant currency basis, sales decreased 8% driven by a decline in volume due to soft demand and customer inventory reductions. North America operating loss was $1.5 million, compared to a loss of $8.2 million in the prior-year quarter.  North America adjusted operating loss decreased 52% to $1.2 million in the current quarter from a loss of $2.5 million in the prior-year quarter.  The improvement in adjusted operating loss was due to cost savings and productivity improvements and the non-recurrence of one-time items in the prior year, which were partially offset by lower sales.
ACCO Brands International – Sales decreased 2% to $124.3 million from $126.2 million in the prior-year quarter.  On a constant currency basis, sales increased 6% due to increased volume and higher prices.  International operating income was $7.6 million compared to $4.0 million in the prior-year quarter.  International adjusted operating income decreased 6% to $8.1 million, compared to $8.6 million in the prior-year quarter due to unfavorable foreign exchange rates, which had a $0.7 million impact.
Computer Products – Sales decreased 8% to $33.7 million, from $36.8 million in the prior-year quarter, due to lower pricing and volume of tablet accessories.  Operating income decreased to $1.9 million from $2.8 million in the prior-year quarter.  Adjusted operating income was $2.2 million, compared to $3.4 million in the prior-year quarter.  The decrease was due to lower sales.
Business Outlook
The company reiterates its expectations for 2014 sales to decline in the mid-single digits and adjusted earnings per share of $0.70-$0.76.  The company continues to expect free cash flow of approximately $140 million.