RRD Reports 3Q 2019 Results

\R.R. Donnelley & Sons Company (RRD) reported financial results for the third quarter of 2019.

Net sales in the quarter were $1.62 billion, down $30.1 million or 1.8% from the third quarter of 2018. The decrease includes a $13.4 million impact from recent business dis-positions and a $10.5 million reduction due to changes in foreign exchange rates.

The Marketing Solutions segment grew 19.9% organically driven by higher volume in the Direct Marketing and Digital Print and Fulfillment product categories. The Business Ser-vices segment was down 4.6% organically due to the exit of unprofitable business in Commercial Print and declines in the Logistics business, partially offset by volume growth in Labels and Packaging.

Income from operations was $73.8 million in the third quarter compared to $60.9 million in the third quarter of 2018.

“I am pleased with our strong financial results for the quarter,” said Dan Knotts, RRD’s president and CEO. “Our favorable performance represents the third consecutive quarter of earnings growth compared to the prior year. We continue to strengthen our core by ag-gressively executing our cost reduction initiatives, improving our portfolio mix with growth in our targeted product categories, and enhancing our financial flexibility with our ongoing actions to reduce debt. Importantly, our team also successfully launched produc-tion of the 2020 Census early in the quarter and continues to meet all milestones and per-formance expectations.”

Cash provided by operating activities of $29.3 million in the third quarter of 2019 de-creased $34.8 million versus the prior year period amount. Cash used in operating activi-ties during the nine months ended September 30, 2019 was $87.8 million compared to $63.9 million in the prior year period.

As of Sept. 30, 2019, cash on hand was $144.7 million and total debt outstanding was $2.03 billion, down $148 million from Sept. 30, 2018. The 2019 amount includes $223.0 million drawn against the credit facility. Availability under the credit facility was $438.6 million at Sept. 30, 2019.